SPX Closes at 1,071 Support Level...Forms Hammer Candle...

DJIA             10,213.62   -57.59   -0.56%
SP500            1,071.69     -3.94   -0.37%
COMPQ          2,179.76   +0.81  +0.04%
Russell 2000     610.78     -0.18   -0.03%

Exchange      NYSE     NASD
Advancing     1,240       1,284
Declining       1,733      1,318

Oil             $73.46   -0.89
Gold     $1,227.20   -6.60
SOX          327.88  +1.46
VIX             25.49   -0.95

Index      Direction     Confirmation
VIX          Down            No – SPX
SOX         Up                Yes – COMPQ

Leading stocks on Friday included CRM, VMW, RMBS, RVBD, FFIV, NTES, GES, DECK, NETL, NFLX, CMG, HSY, CHL, PCLN, WFMI, GS, TSL, USD, FAZ, POT, NTRI, AGU, HANS, WMT, AMX, BUCY, MCD, MOS

The SPX moved below Monday’s low before buyers took over at 1,063 on expiration Friday and rallied the SPX to close at its 1,071 support area. The SPX was down just 7 points from last Friday’s close.

Look at these Charts

(click image to enlarge)

As I said in the Weekly Wrap on Friday, the lack of selling conviction to the downside despite plenty of economic reasons for the market to go down big, suggests that sellers are limited at these price levels. Big money is apparently still viewing a stronger economic environment six to nine months in the future.

Additionally the VIX did NOT confirm the SPX’s lower close on Friday.

On the daily chart the SPX formed a hammer and on its weekly chart it formed an inverted hammer, both bullish candle patterns. The SPX and many individual stocks are in a sideways trend, trading range or non-trending consolidation and at support on Friday.

Look at these Charts

(click image to enlarge)

INDU = hammer like candle
SPX = hammer
COMPQ = hammer
RUT = dragon fly doji

The question is what move is most probable in a sideways trend with price at support? The most probable development is a price bounce at support in a sideways trend.

CRM and INTU broke through horizontal resistance on Friday after reporting earnings and NTES which broke through resistance on Thursday also following earnings continued higher. MRVL also broke through short resistance after earnings but it formed a trend reversal rather than a new high. AKAM broke through horizontal resistance on above average volume joining CRM, INTU and NTES making new highs.

Look at these Charts

(click image to enlarge)

Bullish Engulfing - RVBD, CMG and HSY all formed bullish engulfing patterns on a support bounce and NFLX confirmed Thursday’s piercing line pattern.

Look at these Charts

(click image to enlarge)

Piercing Line Patterns - BIDU, DECK, AGU and MOS formed piercing line patterns, each in bull flag support bounce. Look for confirmation on Monday.

Look at these Charts

(click image to enlarge)

Hammers - GMCR, CLF, LVS, X, CAT, PCP, GR, WYNN, NYX, FCX, FDX and UPS all hammers in consolidation pull backs. Look for potential confirmation on Monday.

Look at these Charts

(click image to enlarge)

Stay focused on and trade according to the chart on Monday.

Guidance:
SPX
Resistance: 1,086, 1,100, 1,115
Support: 1,071, 1,056

Friday’s trading found support and formed a bullish hammer and a bullish inverted hammer on the weekly chart.  There is a MACD bullish divergence in the MACD Histogram on the daily chart.  Look for confirmation of the hammer and support bounce on Monday.  If support does not hold look for the SPX to move to the next support level of 1,056.

Look to enter bullish trades when a new bounce off support and a break above the high of the low day or a breakout above horizontal resistance occurs. This could occur on Monday and occurred for some stocks on Friday.

Adjust stops on bearish trades for a potential exit if they bounce above the high of the low day. Enter bearish setups with a new bounce down from resistance or break of support

The VIX fell -0.95 to 25.49 holding above the benchmark 25 level.

The short term 3 day trend is down.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch. Trade with the trend of the chart and follow your rules.

AAPL -0.24 – inverted hammer
QCOM +0.80 – bullish engulfing
GOOG -5.95 – three black crows
BIDU +0.98 – piercing line

NDX 100 stocks stronger than the NDX include: INTU, MRVL, AKAM, SYMC, CTXS, BRCM, QCOM, ADSK, GENZ, CHRW, FSLR, LLTC, WYNN, BIDU and RYAAY.

Stocks weaker than the NDX: ISRG, RIMM, AMAT, XRAY, WCRX, ERTS, LRCX, GILD, LOGI, LINTA, GOOG, FLIR, STX, ROST and MSFT.

Stocks to Watch on Monday
Holding Above 30 DMA
TLT, VOD, GMCR, HANS, BUCY, CAT, HLF, PCLN, RVBD, AGU, MCD, DE, IPI, SINA, MOS, POT, FCX, GES, PCP, WLT, X, CHL, CLF, FDX, FFIV, GR, LVS, NDAQ, SPG, UPS, HAS, LXK, NFLX, FAZ, VMW, CMG, A, BYI, UNP, TSL, NTES
Moving Above 30 DMA = 2
CRM, RMBS
Moving Below 30 DMA = 1
CSTR
Staying Below 30 DMA
AMX, CAM, FLS, GME, GS, MA, NYX, SNDK, SWK, URE, WMT, BA, CRUS, ACN, AIV, AKS, ATI, CREE, DECK, DHR, DOW, FAS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

SPX Breaks the Low of the High Day with Bearish Candle...

DJIA              10,271.21    -144.33   -1.39%
SP500             1,075.63      -18.53   -1.69%
COMPQ           2,178.95     -36.75   -1.66%
Russell 2000       610.96     -17.08   -2.72%

Exchange     NYSE     NASD
Advancing       558         515
Declining      2,466      2,141

SOX      326.42    -5.68
VIX         26.44   +1.85

Index     Direction    Confirmation
VIX        Up                Yes – SPX
SOX       Down           Yes – COMPQ

Leading stocks on Thursday included NTES, FAZ, NFLX, NTRI, GES, ESI, POT, PCLN, HANS, VMW

The SPX broke the low of the high day after the jobs claims report was higher than expected.  A few stocks like NFLX and PCLN rose.  NTES rose after a strong earnings report  Decliners led Advancers 4.4 to 1 on the NYSE.

The SPX fell to its 1,071 support level Thursday when buyers stepped in causing a support bounce to its close at 1,075.  Remember if support breaks, the index is likely to fall to its next support level at 1,056.

CRM rose +7.59, +7.87% following its earnings report after the close.

Guidance:SPX

Resistance: 1,086, 1,100, 1,115
Support: 1,071, 1,056, 1044

Wait to enter up trending stocks until a new bounce off support and a break above the high of the low day occurs.

Thursday was the break of the low of a high day to enter new bearish trades as we alerted you to watch for in Tuesday’s guidance

The VIX rose +1.85 to 26.44 confirming Thursday’s move down and rising above the benchmark 25 level.

The short term 3 day trend is neutral.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -3.19 – bearish engulfing
QCOM -0.93 – black candle breaks low of high day
GOOG -14.18 – large black candle breaks support
BIDU -1.73 –black candle pullback continuation

NDX 100 stocks stronger than the NDX include: SYMC, NVDA, NTAP, AKAM, EBAY, CHKP, PCLN, VRSN, LOGI, HANS and ATVI.

Stocks weaker than the NDX: SHLD, WYNN, FAST, SPLS, INTC, NIHD, FLIR, GOOG, PCAR, NWSA, VRTX, PPDI, FLEX, AMGN and BIIB

Stocks to Watch on Friday

Holding Above 30 DMA
TLT, GMCR, HANS, BUCY, CAT, HLF, PCLN, AGU, MCD, DE, IPI, MOS, POT, FCX, FLS, GES, PCP, WLT, X, CHL, CLF, FFIV, GR, LVS, SPG, HAS, LXK, MA, NFLX, FAZ, VMW, CMG, CSTR, A, BYI, UNP, TSL
Moving Above 30 DMA = 0


Moving Below 30 DMA = 13
AMX, CAM, CRM, FLS, GME, GS, MA, NYX, RMBS, SNDK, SWK, URE, WMT
Staying Below 30 DMA
BA, CRUS, ACN, AIV, AKS, ATI, CREE, DECK, DHR, DOW, FAS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

SPX Forms Inside Day at 30 DMA...

Dave is traveling from an AT Workshop this evening and will post on Thursday...

The SPX rose slightly forming an inside day after Tuesday big rise...the SPX did form a higher low spinning top with a high at 1,099.77 just below Tuesday's high...the trend is still up...

X rose on takeover speculation...

Strong NDX stocks included...BBBY, FLEX, LLTC, FWLT, ROST, STX, CMCSA, STLD, KLAC, LBTYA, EBAY, NTAP, BRCM, LRCX...

Futures Point to a Slightly Higher Open...

ES and NQ futures are higher with less than two hours until the open..stocks are mixed on light volume...TLT is up 18 cents.and the Euro is up 1 pip...


Trading Down:  NFLX, DE, CAT, USO, CREE
 
Trading Up:  POT, MOS, MHS, BUCY, MCD, UNP, VECO, AAPL, AMZN, RIMM
 
POT, MOS, AGU, IPI, PCLN, LVS, GR, CHL, CAM, VMW, CTXS, AKAM, CAT, CLF, DE, GME, GMCR, HLF, RVBD, MICC, QCOM, BIDU and JOYG and moved higher on Tuesday.


NFLX, NTES and VOD pulled back on Tuesday.

BUCY, CMG, CRM, DLR, FCX, FDX, FFIV, FLS, HAS, LXK, MCD, PCP, SPG, SWK, TIE, UNP, UPS, URE, WLT, WMT, X, AMZN, CTSH, INTU, EXPD, EXPE and GOOG gave support bounce or bull flag entry signals on Tuesday with a break above the high of the low day.

Support Bounce Setups for Wednesday: NYX, GS, GES, CRUS, UAUA, CAL, TIE, SINA, NDAQ

Stay focused on and trade according to the chart on Wednesday.  Follow your rules.

N100 Flags: WYNN, LOGI, ILMN, HOLX

Dave is teaching 160 traders Technical Analysis and Trading today in Orlando and will be traveling home this evening...

SPX Confirms Hammer...Breaks the High of the Low Day...

DJIA              10,405.85 +103.84   +1.01%
SP500             1,092.54   +13.16   +1.22%
COMPQ          2,209.44   +27.57   +1.26%
Russell 2000      626.30   +11.20   +1.82%

Exchange      NYSE    NASD
Advancing     2,401      1,996
Declining          639        659

Oil                $76.30   +1.06
Gold        $1,226.60   +2.10
SOX             328.60   +4.34
VIX                24.33    -1.77

Index    Direction  Confirmation
VIX        Down        Yes – SPX
SOX       Up            Yes – COMPQ

Leading stocks on Tuesday included POT, MOS, A, WLT, IPI, FFIV, AGU, AKS, SWN, URE, X, FLS, CSTR, BUCY, ATI, CLF, SKX, TIE, SWK, DECK, GMCR, LVS, FCX, PCLN, CREE, PCP, BYI, WHR, GR, CRM, HLF, VECO, SPG, ATW, HAS, DE, SNDK, BA, UNP, FAS, UCO, CMG, MCD, USD, ACN, CAT, ZION, RMBS, GES, ICE, MA, JEC, HANS

The SPX opened higher reaching an intraday high of 1,100, the next resistance level and then pulled back the last two hours of trading closing at 1,092. Tuesday’s action did confirm Friday’s inside day as a reversal day. Tuesday did break the high of the low day. Twenty six stocks in our watch list and the NDX 100 gave support bounce or bull flag entry signal while ten closed above their 30 DMA with no stocks made a new close below their 30 DMA.

INDU = doji confirmation support bounce
SPX = hammer confirmation support bounce
COMPQ = piercing line confirmation

POT, MOS, AGU, IPI, PCLN, LVS, GR, CHL, CAM, VMW, CTXS, AKAM, CAT, CLF, DE, GME, GMCR, HLF, RVBD, MICC, QCOM, BIDU and JOYG and moved higher.

NFLX, NTES and VOD pulled back from Monday’s close.

BUCY, CMG, CRM, DLR, FCX, FDX, FFIV, FLS, HAS, LXK, MCD, PCP, SPG, SWK, TIE, UNP, UPS, URE, WLT, WMT, X, AMZN, CTSH, INTU, EXPD, EXPE and GOOG gave support bounce or bull flag entry signals on Tuesday with a break above the high of the low day.

Support Bounce Setups for Wednesday: NYX, GS, GES, CRUS, UAUA, CAL, TIE, SINA, NDAQ

Stay focused on and trade according to the chart on Wednesday.

N100 Flags: WYNN, LOGI, ILMN, HOLX

Guidance:
SPXResistance: 1,100, 1,115
Support: 1,086, 1,071, 1,056

Enter strong stocks up with a bounce off support and a break above the high of the low day.

Tuesday was the day to exit many bearish trades that broke above the high of the low day. Wait for a break of the low of a high day to enter new bearish trades

The VIX fell -1.77 to 24.33 confirming Tuesday’s move up and dropping below the benchmark 25 level.

The short term 3 day trend is up.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL+4.33 – confirm bullish harami and inside day entry
QCOM +0.50 – support bounce continuation after bullish engulfing entry
GOOG +4.93 – spinning top entry confirms Friday’s bullish harami and inside day
BIDU +0.08 –bounce continuation in bull flag

NDX 100 stocks stronger than the NDX include: URBN, NIHD, FAST, PCAR, JOYG, FLEX, GRMN, PCLN, BRCM, EXPD, STLD, JBHT, SYMC, CTXS and SIAL.

Stocks weaker than the NDX: STX, APOL, RIMM, GENZ, LBTYA, AMGN, CELG, CERN, VRTX, NTAP, CMCSA and BIDU.

Stocks to Watch on Wednesday
Holding Above 30 DMA
TLT, GMCR, HANS, BUCY, CAT, HLF, PCLN, AGU, MCD, DE, GS, IPI, MOS, POT, FCX, FLS, GES, PCP, WLT, X, CHL, CLF, FFIV, GR, LVS, SPG, HAS, NYX, LXK, MA, NFLX, FAZ, CAM, VMW, AMX, CMG, CSTR
Moving Above 30 DMA = 10
A, BA, BYI, CRM, GME, RMBS, SWK, UNP, URE, WMT
Moving Below 30 DMA = 0

Staying Below 30 DMA
CRUS, ACN, TSL, AIV, AKS, ATI, CREE, DECK, DHR, DOW, FAS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Up

Futures Point to a Support Bounce and Higher Open...

ES and NQ futures are higher with less than two hours until the open..stocks are mostly higher on light volume...TLT is down 21 cents.and the Euro is up 38 pips...

Trading Down: FAZ

Trading Up:  POT, MOS, AGU, IPI, FCX, CLF, A, VECO, WLT, X, MCD, DE, GS, WMT, FAS, SNDK, USO, AKS, AAPL, URBN, AMZN, BIDU, AKAM

Follow your rules for support bounce entries (see last nights Setup list) and bearish exits this morning...

SPX Holds Support Forms Hammer Candle Pattern...

DJIA                  10,302.01    -1.14    -0.01%
SP500                 1,079.38   +0.13   +0.01%
COMPQ               2,181.87   +8.39   +0.39%
Russell 2000      615.49 10   +5.61   +0.92%

Exchange     NYSE     NASD
Advancing    1,888      1,643
Declining      1,099      1,020

Oil             $75.24    -0.15
Gold     $1,224.50   +9.60
SOX          324.26   +1.52
VIX             26.10    -0.14

Index      Direction Confirmation
VIX          Down        Yes – SPX
SOX         Up            Yes – COMPQ

Leading stocks on Monday included CSTR, GMCR, NFLX, CLF, VECO, CHL, SNDK, TSL, AMD, ICE, USD, IPI, LVS, CMG, LXK, CAM, GME, HLF, UAUA, TIE, DE, AKS, VMW, NETL, PNC, WFMI, VI, FCX, AMX, POT, CAT, X, GES, CRUS, WHR

The SPX opened lower made a lower low at 1,069 and then rallied to close fractionally higher at 1,079.38 forming a hammer pattern. Monday’s action did NOT confirm Friday’s inside day as a potential reversal day. So traders will wait for Tuesday to look for a break of a high of the low day.

INDU = doji
SPX = hammer
COMPQ = piercing line

NFLX, LVS, CHL, CAM, VMW, POT, CTXS and IPI moved higher.

PCLN, MOS, AKAM, AGU and GR while pulled back from Friday’s close.

CAT, CLF, DE, GME, GMCR, HLF, NTES, RVBD, VOD, MICC, QCOM, BIDU, JOYG gave support bounce entry signals on Monday with a break above the high of the low day.

Support Bounce Setups for Tuesday: NYX, GS, FLS, GES, PCP, SWK, BUCY, FFIV, HAS, CRUS, CRM, MCD, X, WMT, WLT, FCX, URE, UNP, SPG, CMG, LXK, UAUA, CAL, TIE, DLR, UPS, FDX, SINA, NDAQ

Stay focused on and trade according to the chart on Tuesday.

N100 Flags: CTSH, INTU, EXPD, EXPE, WYNN, GOOG, LOGI, ILMN, AMZN, HOLX

Guidance:
SPX
Resistance: 1,086, 1,100, 1,115
Support: 1,071, 1,056

Enter strong stocks up with a bounce off support and a break above the high of the low day.

Continue with bearish trades that continue to make new lows. Exit bearish trades with a break above the high of the low day according to your rules.  Move stops to protect profits if a bounce occurs.

The VIX fell -0.14 to 26.10 confirming Monday’s move down and staying above the benchmark 25 level.

The short term 3 day trend is down.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -1.46 – bullish harami, inside day again
QCOM +0.69 – bullish engulfing confirms inverted hammer, bullish harami inside day gap support bounce
GOOG -0.76 – spinning top did not confirm Friday’s bullish harami, inside day
BIDU +1.52 – bullish engulfing confirming Friday’s inside day in bull flag

NDX 100 stocks stronger than the NDX include: APOL, JOYG, WCRX, CSCO, EBAY, ERTS, DISH, MICC, BIDU, QCOM, FISV, STLD, VRSN, INTC and LOGI.

Stocks weaker than the NDX: RIMM, NVDA, FLEX, ADBE, ISRG, AMGN, ADSK, BRCM, GILD, HOLX, PCLN, GRMN, AKAM, ILMN and SBUX.

Stocks to Watch on Tuesday
Holding Above 30 DMA
TLT, GMCR, HANS, BUCY, CAT, HLF, PCLN, AGU, MCD, DE, GS, IPI, MOS, POT, FCX, FLS, GES, PCP, WLT, X, CHL, CLF, FFIV, GR, LVS, SPG, HAS, NYX, LXK, MA, NFLX, FAZ, CAM, VMW
Moving Above 30 DMA = 2
CMG, CSTR
Moving Below 30 DMA = 5
BYI, CRM, UNP, URE, WMT
Staying Below 30 DMA
CRUS, SWK, ACN, BA, GME, TSL, A, AIV, AKS, AMX, ATI, CREE, DECK, DHR, DOW, FAS, RMBS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

Futures Point to a Slightly Lower Open...

ES and NQ futures are just below even shortly before the open...individual stocks are mixed in light volume in pre-market trading...TLT is 1.71 higher and the Euro is up 71pips.

Moving Down:  ESI, PCLN, AGU, CREE, GS, NFLX, UNP, FFIV, ATI, CAT, SNDK, BA, JEC, FAS, AAPL, PCLN, WYNN, GOO, RIMM, AKAM, FSLR, ISRG, BRCM, LIFE, WCRX

Moving Up:  CSTR, ICE, MA, VECO, VMW, CHL, FCX, SPG, ATW, SKX, SWK, CMG

Continue to stay with bearish trades that fail to break the high of the low day and follow your rules for exiting those that bounce...

Watch up trending stocks that made a new low day Thursday or Friday for a potential support bounce entry...
Support Bounce Setups for Monday: NYX, GS, DE, FLS, GES, GME, PCP, SWK, BUCY, FFIV, HAS, CRUS, GMCR, HLF, CAT, CRM, MCD, X, WMT, WLT, FCX, URE, UNP, SPG, CLF, CMG, LXK, CAM, UAUA, CAL, TIE, DLR, UPS, FDX, VOD, NTES, RVBD, SINA, NDAQ

N100 Flags: MICC, CTSH, INTU, QCOM, BIDU, EXPD, EXPE, JOYG, WYNN, GOOG, LOGI, ILMN, AMZN, HOLX

Dave is traveling today to teach an Advanced Technicals Workshop in Orlando...

SPX Rally Fades into Close...Holds at Support...

DJIA              10,303.15   -16.80   -0.16%
SP500             1,079.25     -4.36   -0.40%
COMPQ           2,173.48   -16.79   -0.77%
Russell 2000      609.49     -7.49   -1.21%

Exchange      NYSE     NASD
Advancing     1,379         799
Declining       1,642      1,809

Oil              $75.39   -0.35
Gold      $1,214.90   +0.10
SOX           322.74    -3.01
VIX              26.24   +0.51


Index         Direction Confirmation
VIX             Up             Yes – SPX
SOX            Down        Yes – COMPQ

Leading stocks on Friday included BYI, RMBS, VMW, CAM, FFIV, BAC, AMX, WLT, GR, AGU, UNG, FAZ, CAT, DOW, DLR, HAS, HSY, PCP, UAUA, STI, CRM, MHS, SPG, BA, SWK, JEC, LVS, WFMI

The SPX opened lower and cycled up and down in a narrow range between 1,079 and 1,086, finally finishing Friday at the low end of the range at 1,079.25. The three major indexes formed an inside day which are a potential reversal day.


INDU spinning top inside day
SPX inverted hammer inside day
COMPQ black candle inside day

NFLX, PCLN, POT, MOS, AGU and IPI finally took a rest forming spinning top patterns.

LVS and AKAM moved higher while CHL pulled back.

CAM, VMW, GR, CTXS gave bull flag entry signals on Friday with a break above the high of the low day.

Support Bounce Setups for Monday: NYX, GS, DE, FLS, GES, GME, PCP, SWK, BUCY, FFIV, HAS, CRUS, GMCR, HLF, CAT, CRM, MCD, X, WMT, WLT, FCX, URE, UNP, SPG, CLF, CMG, LXK, CAM, UAUA, CAL, TIE, DLR, UPS, FDX, VOD, NTES, RVBD, SINA, NDAQ

Stay focused on and trade according to the chart on Monday.

N100 Flags: MICC, CTSH, INTU, QCOM, BIDU, EXPD, EXPE, JOYG, WYNN, GOOG, LOGI, ILMN, AMZN, HOLX

Guidance:
SPX
Resistance: 1,086, 1,100, 1,115
Support: 1,071, 1,056

Enter strong stocks up with a bounce off support and a break above the high of the low day.

Continue with bearish trades that continue to make new lows. Exit bearish trades with a break above the high of the low day according to your rules.

The VIX rose +0.51 to 26.24 confirming Friday’s move down.

The short term 3 day trend is down.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -2.69 – bullish harami, inside day
QCOM -0.29 – inverted hammer, bullish harami inside day at gap support
GOOG -5.66 – bullish harami, inside day in bull flag
BIDU +0.18– spinning top, inside day in bull flag

NDX 100 stocks stronger than the NDX include: NVDA, ADSK, STX, NTAP, PPDI, ESRX, FWLT, CTXS, PAYX, ILMN, AKAM, RYAAY, NIHD, AMGN and LIFE.

Stocks weaker than the NDX include: APOL, GRMN, BRCM, URBN, DISH, SBUX, XLNX, JBHT, IACI, CMCSA, INTC, AMZN, NWSA, RIMM and BBBY.

Stocks to Watch on Monday
Holding Above 30 DMA
TLT, GMCR, HANS, BUCY, CAT, CRM, HLF, PCLN, AGU, MCD, DE, GS, IPI, MOS, POT, FCX, FLS, GES, PCP, WLT, WMT, X, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, HAS, NYX, LXK, MA, NFLX, FAZ
Moving Above 30 DMA = 3
BYI, CAM, VMW
Moving Below 30 DMA = 3
CMG, CRUS, SWK,
Staying Below 30 DMA
ACN, BA, GME, TSL, A, AIV, AKS, AMX, ATI, CREE, CSTR, DECK, DHR, DOW, FAS, RMBS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

Futures Point to a Flat Open...

ES and NQ futures are near even shortly before the open...Individual stocks are mixed on light volume in pre-market open trading...TLT is up 63 cents and the EURO is down 25 pips...

Moving Down:  SPG, SWN, CHL, WHR, IPI, BYI, URE, FFIV, CMG, GOOG, QCOM, MICC

Moving Up:  VECO, RMBS, MA, AGU, MOS, CRM, NFLX, CAT, VMW, DHR, POT, LXK, GS, CLF, X, ATW, DECK, BA, CREE, ADSK, BIDU, PCLN, WYNN, NTAP, KLAC, RYAAY, NVDA, MRVL

Stay with bearish trades that fail to break the high of the low day and follow rules for exiting those that bounce...

Watch stocks that made a new low day on Thursday for a potential bounce entry...

Support Bounce Setups for Friday: NYX, GS, DE, FLS, GES, GME, PCP, SWK, BUCY, FFIV, HAS, CRUS, GMCR, HLF, CAT, CRM, VMW, MCD, X, WMT, WLT, FCX, GR, URE, UNP, SPG, CLF, CMG, LXK, CAM, UAUA, CAL, TIE, DLR, UPS, FDX


NDX 100 Flags: MICC, CTSH, CTXS, INTU, QCOM, BIDU, EXPD, EXPE, JOYG, WYNN, GOOG, LOGI, ILMN, AMZN, HOLX

Other Bounce Setups: VOD, NTES, RVBD, SINA, NDAQ

As always follow your rules...

SPX Gaps Lower, Closes Higher, Makes New Low Day...

DJIA              10,319.95   -58.88   -0.57%
SP500             1,083.61     -5.86   -0.54%
COMPQ           2,163.57   -18.36   -0.83%
Russell 2000      616.98     -3.41   -0.55%

Exchange      NYSE    NASD
Advancing     1,294     1,058
Declining       1,730     1,581

Oil                $75.74     -2.28
Gold         $1,214.80  +17.30
SOX              325.75     -4.31
VIX                 25.73    +0.34

Index      Direction     Confirmation
VIX           Up               Yes – SPX
SOX          Down          Yes – COMPQ

Leading stocks on Thursday included LVS, NFLX, IPI, MOS, PCLN, POT, AGU, GES, CHL, TIE, WLT, WFMI, MHS, CRUS, FAZ, UAUA, BYI, AMD, CLF, MA, SKX, MCD, FCX, DLR, ZION, CAM, DE, NYX, HANS, GS, AMX

The SPX opened lower and made its low of the day during the first 10 minutes of trading and moved 10 points higher before closing at 1,083. Today is a new low day with a higher close than open and a potential reversal day. Watch for a break above the high of the low day on Friday.

NFLX continued to move higher with a horizontal breakout. Its new breakout chart target is 160 with within 3 to 8 weeks.

LVS, PCLN, CHL, AKAM, POT, MOS, AGU and IPI gave bull flag entry signals on Thursday with a break above the high of the low day.

Support Bounce Setups for Friday: NYX, GS, DE, FLS, GES, GME, PCP, SWK, BUCY, FFIV, HAS, CRUS, GMCR, HLF, CAT, CRM, VMW, MCD, X, WMT, WLT, FCX, GR, URE, UNP, SPG, CLF, CMG, LXK, CAM, UAUA, CAL, TIE, DLR, UPS, FDX,

Stay focused on and trade according to the chart.

Guidance: 
SPX
Resistance: 1,086, 1,100, 1,115
Support: 1,071, 1,056

Enter strong stocks up with a bounce off support and a break above the high of the low day.

Exit bearish trades with a break above the high of the low day according to your rules.

The VIX rose +0.34 to 25.73 confirming Thursday’s move down.

The short term 3 day trend is down.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL +1.60 – piercing line
QCOM -1.12 – inverted hammer at gap support
GOOG +0.27 – white candle low day
BIDU -1.58 – spinning top low day in bull flag
NDX 100 stocks stronger than the NDX include: AKAM, PCLN, AMGN, WCRX, EBAY, ORLY, VRTX, BIIB, ESRX, SRCL, CEPH, TEVA, CELG, NIHD and CMCSA.

Stocks weaker than the NDX: CSCO, NTAP, FLEX, ALTR, XLNX, IACI, RIMM, ORCL, QCOM, BRCM, SHLD, STX, LLTC, FLIR and APOL.

Stocks to Watch on Friday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, BUCY, CAT, CRM, HLF, PCLN, AGU, MCD, DE, GS, IPI, MOS, POT, FCX, FLS, GES, PCP, WLT, WMT, X, SWK, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, CMG, HAS, NYX, LXK, MA, NFLX, FAZ
Moving Above 30 DMA = 0


Moving Below 30 DMA = 5
ACN, BA, GME, TSL, VMW
Staying Below 30 DMA
A, AIV, AKS, AMX, ATI, CAM, CREE, CSTR, DECK, DHR, DOW, FAS, RMBS, SNDK, STI, TIE, UAUA, UCO, USO, V, DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, BYI, JEC, NTRI, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

Futures Point to a Lower Open...

ES and NQ futures are lower this morning and many individual stocks are lower on light pre-market volume.  TLT is lower as is the EURO.

Moving Down:  VMW, FFIV, PCLN, GS, NETL, SNDK, X, FCX, POT, VECO, V, STI, USO, CREE, FAS, CLF, CRUS, MOS, NFLX, AKS, GOOG, CSCO, FSLR, BIDU, CTXS, AAPL, AKAM, PCLN, NTAP, AMZN, BRCMGENZ, QCOM

Moving Up:  CHL, LVS, FAZ, DE, SPG, LXK, EBAY, RYAAY

Dave will sub in Virtual Coaching Options on Thursday at 11 am MT (1 pm ET) for two hours. Bring your questions on this week's market action...


Follow your rules in your bearish trades...

Watch for a support bounce before entering new bullish trades...

SPX Opens Lower...Breaks Support...

DJIA           10,378.83    -265.42   -2.49%
SP500           1,089.47      -31.59   -2.82%
COMPQ        2,208.63      -68.54   -3.01%
Russell 2000    620.39      -25.97   -4.02%


Exchange     NYSE     NASD
Advancing       439         293
Declining      2,645      2,381

SOX      330.06     -14.68
VIX          25.39     +3.02

Index      Direction     Confirmation
VIX          Up                Yes – SPX
SOX         Down           Yes – COMPQ

Leading stocks on Wednesday included FAZ, NFLX, UNG

Weakest stocks on Wednesday included VECO, CREE, FAS, CRUS, ATI, TIE, USD, UAUA, AKS, ZION, SNDK, UCO, STI, FFIV, SWN, ATW, NETL, LVS, BUCY, WLT, X, CLF

Dave will sub in Virtual Coaching Options on Thursday at 11 am MT (1 pm ET) for two hours.  Bring your questions on this week's market action...

Stocks survived a weaker than expected jobs report on Friday and a weaker than expected productivity report on Tuesday, but it did survive indications of slowing growth in China. It was a miniature version of the China drop on February 27, 2007 when slowing China growth trigged a massive sell off.

In classic technical fashion the SPX broke short term support and fell to 1,100 and then broke and fell to the 1,185 support area. 1,071 and 1,056 next support levels if the 1,085 does not hold. The SPX, DJIA and NDX held just above the July 30 low, while the RUT broke its July 30 low.

This is the reason I encourage you to stay mentally flexible and realize that on average a 30% probability will occur three times out of ten. Today was the 30% probability becoming the reality. If you weren’t prepared you didn’t pay close enough attention to my comments this week to be prepared if prices rolled over.

On Wednesday, the intermediate term trend (sideways at resistance) won out over the short term up trend, as price turned back into the middle of the sideways trend on increased volume.

The long term trend is still up and the intermediate term trend is still sideways. Stay with the new short term down trend until it finds support.

NFLX +1.17%, managed to rise again notwithstanding volatile trading in the stock. QCOM and MSFT formed white candles on modest pull backs. CREE -13.27%, was crushed after reported better than expected earnings, with lower revenue and higher earnings guidance.

The VIX did confirm Wednesday’s lower close. Breadth was weaker as Decliners led Advancers 6 to 1 on the NYSE.

Stay focused on and trade according to the chart.

Guidance:
SPX
Resistance: 1,100, 1,115,
Support: 1,086, 1,071, 1,056

Wait, to enter new bullish trades, until stocks break above the high of the low day.

Wednesday provided a large number of stocks that broke below of the low of the high day with bearish entries.

The VIX rose +3.02 and closed at 25.39 moving above the important 25 level and confirming a change in the short term trend.

The short term 3 day trend is down.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -9.22 – large black candle breaking support
QCOM -0.42 – white hammer in bull flag
GOOG -11.97 - black candle forming bull flag
BIDU -3.64 – black candle forming bull flag
NDX 100 stocks stronger than the NDX include: STX, RIMM, CERN, ATVI, HSIC, MSFT, ILMN, QCOM, ORLY and NTAP.

Stocks weaker than the NDX: RYAAY, LOGI, STLD, BRCM, LINTA, GRMN, KLAC, FWLT, JOYG, WYNN, EXPE, PCAR, FAST, BIDU and JBHT.

Stocks to Watch on Thursday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, ATW, FCX, FLS, GES, GME, PCP, WLT, WMT, X, SWK, ACN, BA, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, CMG, HAS, NYX, LXK, USO, SNDK, MA, NFLX, DOW, V
Moving Above 30 DMA = 0

Moving Below 30 DMA = 12
A, AIV, AMX, ATI, CSTR, DECK, DHR, FAS, RMBS, STI, UAUA, UCO
Staying Below 30 DMA
DLR, ICE, USD, PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, BYI, JEC, NTRI, FAZ, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down

Futures Point to a Lower Open and a Break of the Low of the High Day...

ES and NQ futures are lower with a little more tha an hour before the open.  AAPL, AKAM, AMZN, BIDU, GOOG, NFLX, PCLN and QCOM are all lower in pre-market trading.

The EUR is down 160 pips, bonds are up, TLT is up 46 cents this morning.  Global economic woes and signs of a slowing economy in China provided the catalyst for selling in Asia and Europe overnight.

As we said yesterday, exit bullish trades according to your rules as it looks like many stocks will break the low of the high day if they did not already do so.

Also if you have longer term options, selling an option against an existing position is a potential strategy that a trader can employ at this time.

Enter bearish trades according to your rules.

SPX Closes Lower but Rallies From Early Lows...

DJIA              10,644.25   -54.50   -0.51%
SP500             1,121.06     -6.73   -0.60%
COMPQ          2,277.17    -28.52   -1.24%
Russell 2000      646.36    -13.16   -2.00%

Exchange     NYSE     NASD
Advancing       826         575
Declining      2,224      2,099

SOX     344.74   -9.31
VIX        22.37  +0.23

Index     Direction    Confirmation
VIX         Up              Yes – SPX
SOX        Down         Yes – COMPQ

Leading stocks on Tuesday included NFLX, FAZ, PNC, FFIV, V, MA, PCLN, STI, WMT, HSY, HAS, DOW, MCD

After a weaker than expected productivity report, short term sellers were in control for the first 30 minutes of trading on Tuesday. The market then traded in a basing pattern until the Fed announcement just after 2 pm ET and then buyers stepped back in and took control. Tuesday’s low was higher than Friday’s low following a weaker than expected jobs report.

NFLX rose +6.94% after announcing a deal that makes NFLX the exclusive internet only distributer of films from the owners of TV pay channel Epix including Paramount Pictures, MGM and Lions Gate. AKAM rose +4.86% after an analyst upgrade from GS.

With the SPX at a zone of resistance it is time protect up trending profits. While the resilience of the SPX still suggests a better probability of the SPX continuing its recent up trend, traders should be prepared to exit trades that roll over and break the low of the high day if the SPX fails to break through resistance.

Please protect your profits according to your rules.

The VIX did confirm Tuesday’s lower close. Breadth was weaker as Decliners led Advancers 2.6 to 1 on the NYSE.
Stay focused on and trade according to the chart.

Setups on NYX and CTSH provided entry opportunities on Tuesday depending on a trader’s entry rules. Setups on CSTR, CAM, CLF, DHR and DECK did not give entry signals and moved lower with the broader market.

Guidance:
SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a bounce off support (old resistance). Stay with stocks in a bounce continuation. Look for breakout opportunities in the SPX and many individual stocks.

Watch for a break of the low of the high day for bearish entries.

The VIX rose +0.23 and closed at 22.37 and is still the 25 level confirming the current up trend since July 7.

The short term 3 day trend is neutral.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -2.34 – spinning top
QCOM +0.03 – white spinning top at resistance
GOOG -1.64 – white spinning top in pennant
BIDU +0.31 – spinning top
NDX 100 stocks stronger than the NDX include: AKAM, IACI, TEVA, HSIC, CELG, DTV, RIMM, AMZN, ATVI, ESRX, EXPE, GENZ, VRSN, BIIB and LOGI.

Stocks weaker than the NDX: STX, LRCX, FLEX, NVDA, DELL, INTC, GRMN, MRVL, KLAC, LINTA, EXPD, AMAT, NTAP, CA and FLIR.

Stocks to Watch on Wednesday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, ATW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, DECK, HAS, NYX, LXK, DHR, SKX, UCO, USO, CSTR, SNDK, A, ATI, MA, NFLX, DOW, V
Moving Above 30 DMA = 0


Moving Below 30 DMA = 3
DLR, ICE, USD
Staying Below 30 DMA
PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, BYI, JEC, NTRI, FAZ, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral

Futures Down after Lower than Forecasted Productivity Report...

Non-farm buisness productivity fell at a 0.9% rate in the second quarter vs. estimates f a 0.4% decline.  This is a catalyst for a light volume pre-market selloff.  ES -10.75 and NQ -16.00 with 45 minutes before the opening bell.  Bonds, TLT +0.36 adn the dollar are higher with the Euro down 100 pips.

Follow your rules if your charts give you exit signals or bearish entry signals.  Even though I pointed out the positive technicals and said last night suggests

Also be mindful of the short term potential impact of the news if big money doesn't join the selling this morning as we saw on Friday with the jobs report.  Also follow your re-entry rules if you exit and a support bounce occurs afterwards. 

The key operative is to trade the charts according to your rules and do NOT make your decisions based on what you think will happen.  As I said last night the positive technicals suggest a higher probability of a breakout than break down.  Infered in that comment is the fact that the lower probability of a break down can still occur.  That is why I said it is not a breakout until it does in fact, breakout and if the market breaks down you have to trade it that way according to your rules. 

Remember Dave's Insight:  Trade the market, not your thoughts.

On Monday night's virtual trade examples which included NYX, I will hold on any that open lower and look for potential support bounce at a more favorable price.  NYX, CLF and CTSH are lower on very light volume.  CAM, CSTR, DECK and DHR have no pre-market trading at this time.

Follow your rules...

SPX Inches to New High Close by 1/2 Point...

DJIA              10,698.75     +45.19    +0.42%
SPX                1,127.79       +6.15    +0.55%
COMPQ           2,305.69     +17.22    +0.75%
Russell 2000       659.52       +8.84    +1.36%

Exchange     NYSE   NASD
Advancing    2,206     1,779
Declining         838       896

SOX         354.05   +2.30
VIX            22.14   +0.40

Index   Direction   Confirmation
VIX       Up              No – SPX
SOX     Up              Yes – COMPQ

Leading stocks on Monday included UAUA, CLF, GMCR, A, V, MA, FFIV, S, SNDK, ESI, CRUS, DOWN, URE, ATI,TLS, DE, UCO, CRM, HANS, FAS, MCD, AIV, NYX, NTRI, UNP, CREE, WHR, HLF, AGU, ICE, LXK, USD, BUCY, ZION, USO, VMW, HAS, SPG, NETL, WLT, DECK, DLR, X, LVS

Dave will be in Virtual Coaching Options on Thursday at 11 am mountain, 1 pm eastern time.

Take the time to read Monday mornings comments and my response.  Unbelievable!

As I wrote over the weekend, the jobs report is a non-issue since it failed to generate more than a two hour selloff. The SPX is at resistance. The fact that price held this level for six trading days, the weak jobs report could not keep the market down and the SPX and many stocks have bounced off a higher low, suggests a higher probability of a breakout that break down. Trade the chart.

The VIX did NOT confirm Monday’s higher close. Breadth got stronger as Advancers led Decliners 2.6 to 1 on the NYSE.

Stay focused on and trade according to the chart.

Look at the setups on NYX, CSTR, CAM, CLF, CTSH, DHR, DECK and other leading stocks from today’s watchlist.

Guidance:
SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a bounce off support (old resistance). Stay with stocks in a bounce continuation. Look for breakout opportunities in the SPX and many individual stocks.

Wait for a break of the low of the high day for bearish entries.

The VIX rose +0.40 and closed at 22.14 and is still well below the important 25 level confirming the current up trend since July 7.

The short term 3 day trend is neutral.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL +1.66 – spinning top
QCOM +1.10 – large white breakout candle following small bullish engulfing
GOOG +5.13 – white candle support bounce following return move to breakout
BIDU +1.03 – spinning top
NDX 100 stocks stronger than the NDX include: LINTA, RIMM, AKAM, CSCO, QCOM, WCRX, FWLT, EBAY, WYNN, ROST, GRMN, HANS, URBN, MRVL and CHRW.

Stocks weaker than the NDX: DISH, HOLX, STX, GENZ, ESRX, DELL, PCLN, RYAAY, SPLX, HSIC, AMGN, ORCL, NTAP, CERN and EXPE.

Stocks to Watch on Tuesday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, ATW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, DECK, HAS, NYX, LXK, DHR, SKX, UCO, USO, CSTR, SNDK, USD, A, ATI, MA, NFLX
Moving Above 30 DMA = 4
DLR, DOW, ICE, V
Moving Below 30 DMA = 0

Staying Below 30 DMA
PNC, SWN, ZION, UNG, VECO, WFMI, NETL, SKX, AMD, BYI, JEC, NTRI, FAZ, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral

Stocks Open Higher...

The SPX opens higher as futures move higher over night.  Friday becomes a low day on many charts and today can be a break above the high of the low day for potential re-entry signals.  Also the SPX could break above last Wednesday's high of 1,128.75.

Early leaders include WLT, ESI, UAUA, MCD, GMCR, A, WFMI, DECK, HAS, HLF, V, GES, ZION,CHL, DOW, LXK, CRUS, LINTA, EBAY, CSCO, URBN, EXPE, BIDU, QCOM, NIHD, ROST, CHRW, SBUX, MICC

Follow your rules in any trading today and be logical.

See you in the Monday night AT webcast this evening...

SPX Closes Lower...Rallies From Daily Low After Worse Than Expected Jobs Report...

DJIA               10,653.56     -21.42     -0.20%
SPX                 1,121,64       -4.17     -0.37%
COMPQ           2,288.47       -4.59     -0.20%
Russell 2000       650.68       -4.39     -0.67%

Exchange      NYSE   NASD
Advancing     1,388    1,072
Declining       1,619    1,542

SOX    351.75   -0.69
VIX       21.74   -0.36

Index     Direction   Confirmation
VIX        Down          No – SPX
SOX       Down          Yes – COMPQ

Leading stocks on Friday included HANS, NFLX, TSL, MA, HLF, MCD, X, GES, CRUS, ATI, FAZ, RMBS, WLT, AKS, TIE, A, V, PCLN, LVS, CHL, MHS, VECO, CAN, FCX, DOW, CREE, JEC, CMG, NYX, WFMI, WMT

On Friday the SPX fell after a worse than expected jobs report. However the selling lasted about 90 minutes and then held around the 1,109 area until the last two hours of trading when buyers took over and the SPX rallied 12 points to close at 1,121. The SPX formed a large tail doji or hammer like candle.

While the jobs report makes the economy look weak, that is a startling revelation since most everyone thought otherwise (sarcasm intended), once short term traders sold the SPX off there was not follow through to the downside, so buyers stepped back for a closing rally.

Now, this is where technical analysis gets really fun. TA allows us to watch the trend, support and resistance and momentum. The price action suggests that the jobs report was not that surprising to big money, so when short term traders took the SPX down, no one got on the bandwagon to the downside and the market came back.

I mentioned on the Thursday post that the jobs report would be the catalyst for direction in the short run and it did for two hours. That is the short run. Then that was it. As I have been teaching for six years short term news is good for one to two days…this was good for two hours.

Forget the jobs report and trade the chart action on Monday. If it is down, trade down. If it is up, trade up. As always follow your rules.

The VIX did NOT confirm Friday’s lower close and closing at its lowest close since May 3. Breadth got stronger as the number of advancers on the NYSE and NASD increased on Friday from Thursday.

Stay focused on and trade according to the chart.

Guidance:
SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a bounce off support (old resistance). Stay with stocks in a bounce continuation.  If you got stopped out on Friday and the stock trend reverses up, re-entry the up trend according to you rules.

Wait for a break of the low of the high day for bearish entries.

The VIX fell -0.36 and closed at 21.74; a new low close and its lowest close since May 3. Th VIX is well below the important 25 level confirming the current up trend since July 7.

The short term 3 day trend is neutral.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL -1.60 – spinning top
QCOM +0.15 – small bullish engulfing
GOOG -7.88 – black candle return move to horizontal breakout
BIDU +0.96 – bullish engulfing
NDX 100 stocks stronger than the NDX include: HANS, FWLT, WCRX, RYAAY, RIMM, AKAM, EBAY, ILMN, SHLD, ESRX, EXPE, WYNN, YHOO, VRTX and NVDA.

Stocks weaker than the NDX: ATVI, ADSK, NIHD, STX, NWSA, JBHT, CMCSA, GOOG, ORLY, NTAP, FLIR, EXPD, TEVA, BRCM and PAYX.

Stocks to Watch on Monday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, ATW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, DECK, HAS, NYX, LXK, DHR, SKX, UCO, USO, CSTR, SNDK, USD
Moving Above 30 DMA = 4
A, ATI, MA, NFLX
Moving Below 30 DMA = 4
ICE, PNC, SWN, ZION
Staying Below 30 DMA
DLR, UNG, VECO, WFMI, DOW, NETL, SKX, AMD, BYI, V, JEC, NTRI, FAZ, ESI, HSY, BAC, MHS, WHR

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Neutral

Back to the Present...SPX at Resistance...Be Prepared...

DJIA            10,674.98  -5.45 -0.05%
SP500           1,125.81  -1.43 -0.13%
COMPQ        2,293.57 -10.51 -0.46%
Russell 2000    662.96  -7.30 -1.19%

Exchange       NYSE    NASD
Advancing      1,282        886
Declining        1,744     1,762

SOX      352.44   -2.27
VIX         22.10   -0.10

Index    Direction Confirmation
VIX         Down       No – SPX
SOX       Down        Yes – COMPQ

Leading stocks on Wednesday included PCLN, GES, POT, IPI, NFLX, DOW, MOS, TSL, CSTR, TIE, AGU, FAZ, CAM, CAT, BYI, SWN, DHR, UNP, NYX, DE, A, STI, WFMI, CHL, LXK, PCP

On Thursday the SPX formed a doji with a lower shadow while holding at the 1,120 to 1,130 resistance level. No horizontal break out yet.

Follow your rules and be prepared for a potential pull back or a breakout. Stay focused on and trade according to the chart.

Unemployment numbers will be out on Friday and likely will be the catalyst for whichever direction stocks move in the short run.

Dave is traveling back from the future today and will post Friday evening...

SPX Moves Higher...PCLN Leads Nasdaq...

DJIA             10,680.43  +44.05  +0.41%
SP500             1,127.24   +6.78  +0.61%
COMPQ          2,303.57  +20.05  +0.88%
Russell 2000      662.96   +7.30  +1.11%

Exchange     NYSE   NASD
Advancing    2,259     1,760
Declining        789        887

Oil            $82.47  -0.08
Gold    $1,193.70  +8.50
SOX         354.71  +3.46
VIX            22.21   -0.42

Index      Direction   Confirmation
VIX           Down        Yes – SPX
SOX          Up            Yes – COMPQ

Leading stocks on Wednesday included PCLN, MOS, POT, CLF, AGU, LXK, GES, NFLX, VMW, CRUS, ATW, GME, LVS, ICE, HAS, IPI, HLF, SNDK, CHL, CRM,WLT, SWN, FLW, X, MA, SKX, GS, DHR, USD, A, NTRI, FFIV, SPG, GMCR, FCX

On Wednesday the SPX rallied from Tuesday pull back and made a new high close just above Monday’s high. A majority of stocks also rallied from Tuesday’s pull back and gave a return move bounce entry while others gave a horizontal breakout entry signal.  PCLN gapped up and closed up $50.63, a horizontal break out to a new 10 year high after reporting better than expected earnings.

Horizontal breakout entry signals on Wednesday: CRM, LXK, PCLN, PCP, VMW, GME, ICE

Horizontal breakout Setup for Thursday: CAT, FAS, STI, FCX, WLT, URE, AIV, AMX

Bounce entry on Wednesday: CRUS, VECO, GES, SPG, SNDK, FLS

Trends continued in POT, MOS, AGU, LVS, CLF, FFIV, UCO, X, ATW, USO, CSTR, GS

Bounce Setup: DECK, ATI, NYX, BYI, A, ZION, USD, WHR, AKS, CREE, JEC, BAC, PNC, UAUA, CAL

Guidance:
Stay with the trend.
Buy when you are supposed to buy and sell when you are supposed to sell.

SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a bounce off support (old resistance) or breakout of resistance. Stay with stocks in a bounce continuation.

Wait for a break of the low of the high day for bearish entries.

The VIX fell -0.42 and closed at 22.63; continues well below the important 25 level confirming the current up trend since July 7.

The short term 3 day trend is up.
The two-month trend is neutral.  Watch for potential horizontal breakout.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL +1.05 – doji
QCOM -0.03 – doji
GOOG +16.49 – large white candle horizontal breakout with high volume
BIDU +1.81 – whit candle in trend continuation
NDX 100 stocks stronger than the NDX include: PCLN, ERTS, EXPE, NVDA, AMZN, FSLR, EXPD, LINTA, GOOG, STLD, HOLX, VRTX, CTXS, ILMN and JBHT.

Stocks weaker than the NDX: RIMM, ESRX, MSFT, DELL, FLEX, WCRX, TEVA, GENZ, GRMN, ORLY MICC, MCHP, RYAAY, HANS and LBTYA.

Stocks to Watch on Thursday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, VECO, ATW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, DLR, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, DECK, HAS, NYX, LXK, UNG, DHR, SKX, UCO, USO, ZION, CSTR, PNC, SNDK
Moving Above 30 DMA = 2
ICE, USD
Moving Below 30 DMA = 2
ATI, WFMI
Staying Below 30 DMA
DOW, NETL, MA, SKX, AMD, BYI, V, A, JEC, NTRI, FAZ, NFLX, ESI, HSY, BAC, MHS, WHR, SWN


Intermediate Term Market Trend: Neutral
Short Term Market Trend: Up

PCLN Gaps Up 18%...TIE, WFMI Gap Down...

SPX Pauses Above S1...

DJIA                 10,636.38   -38.00   -0.36%
SP500                1,120.46     -5.40   -0.48%
COMPQ              2,283.52   -11.84   -0.52%
Russell 2000         655.66     -6.20   -0.94%

Exchange      NYSE   NASD
Advancing     1,186       951
Declining       1,835    1,713

Oil             $82.55 +1.06
Gold     $1,185.20 +1.80
SOX          351.25  -3.69
VIX             22.63 +0.62

Index       Direction   Confirmation
VIX            Up             Yes – SPX
SOX          Down         Yes – COMPQ


Leading stocks on Tuesday included HLF, AKS, FAZ, NFLX, UCO, ATW, PCLN, WFMI, GR, USO, V, GMCR, TSL, LVS, CREE, CMG, X, SWN, UNP, CSTR, GS, MCD, AMX, NYX, VECO


On Tuesday the SPX paused and pulled back to Monday’s S1 level. Many stocks also paused after their recent support bounce or at horizontal resistance setting up either a return move bounce entry or horizontal breakout entry.

Potential horizontal breakout signals on Wednesday: CRM, LXK, PCLN, PCP, CAT, VMW, FAS, STI, GME, CAM, FCX, WLT, URE, AIV, AMX

Guidance:
SPX pulls back to its July 27 resistance and Monday’s S1 level and closes at 1,120...
Breakout return move test pattern…
The SPX holds above S1 and old short term resistance…
The VIX did confirm the lower close in the SPX, and stayed below 25.
Breadth was weaker as decliners led advancers 1.5 to 1 on the NYSE.
SPX price target is still 1,141…
Do you have return to breakout point rules for entry, that you should follow?

SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a bounce off support (old resistance). Stay with stocks in a bounce continuation.

Wait for a break of the low of the high day for bearish entries.

The VIX rose +0.62 and closed at 22.63; it is well below the important 25 level confirming the current up trend since July 7.

The short term 3 day trend is up.

The two-month trend is neutral and is currently at 1,130 horizontal resistance area.  Watch for a potential horizontal breakout.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL +0.08 – spinning top above S1
QCOM -0.30 – spinning top in bull flag bounce
GOOG -0.58 – spinning top in bull flag bounce
BIDU +0.19 – doji in trend continuation
NDX 100 stocks stronger than the NDX include: CTSH, HOLX, VRSN, AKAM, WYNN, VRTX, INFY, AMZN, PCLN, CEPH, CTXS, RYAAY, XRAY, IACI and HSIC.

Stocks weaker than the NDX: APOL, SPLS, STX, ATVI, LINTA, SHLD, NVDA, URBN, RIMM, PCAR, DISH, EBAY, FLEX, MRVL and BBBY.

Stocks to Watch on Wednesday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, VECO, ATW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, DLR, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, WFMI, DECK, HAS, NYX, LXK, UNG, DHR, SKX, UCO, USO, ZION, ATI, CSTR, PNC, SNDK
Moving Above 30 DMA = 0


Moving Below 30 DMA = 3
DOW, NETL, USD
Staying Below 30 DMA
MA, SKX, AMD, BYI, V, A, JEC, NTRI, FAZ, NFLX, ESI, HSY, BAC, MHS, WHR, SWN, ICE

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Up

SPX Bull Flag Bounce...Entry Signals Galore...

DJIA                10,674.44  +208.44 +1.99%
SP500               1,125.86    +24.26 +2.20%
COMPQ             2,295.36   +40.66 +1.80%
Russell 2000         661.86   +10.97 +1.69%

Exchange      NYSE   NASD
Advancing      2,626    1,918
Declining          463       774

Oil          $81.34   +2.39
Gold   $1,183.40 +12.00
SOX        354.94   +6.13
VIX           22.01    -1.49

Index      Direction Confirmation
VIX          Down       Yes – SPX lowest close since May 3
SOX         Up           Yes – COMPQ

Leading stocks on Monday included WLT, CLF, FAS, UCO, URE, X, GME, SPG, FCX, AIV, VECO, WHR, LVS, USD, LXK, CREE, ATW, ATI, SNDK, DOW, MOS, NYX, BYI, USO, AKS, A, ZION, CSTR, JEC, CRM, FLS, TIE, ICE, BAC, AMX, GES, POT, PNC, CAM, STI, WFMI

On Monday the SPX bounced in its bull flag pattern, confirmed Friday’s hammer and broke out of short term resistance. The INDU did the same confirming Friday’s doji. The COMPQ and RUT bounced and confirmed Friday’s piercing line like patterns, but did NOT break out of short term resistance. The SPX led and the RUT lagged.

The market move was led by a rising Euro 1.3174, +129 pips and Energy XLE +3.49%, Materials XLB +2.69% and Financials XLF +2.52%.

HLF is up +10% in after hours trading after reporting earnings of $1.32 vs 93 cents estimates.
Trends continued in POT, MOS, AGU, LVS, DECK, CLF, FFIV

Resistance breakout on Monday: LVS, DECK, CLF, MOS

Entry signals on Monday: CRUS, CREE, VECO, CRM, LXK, GES, PCLN, PCP, CAT, VMW, AKS, X, FAS, STI, GME, CAM, FCX, WLT, UCO, URE, SPG, AIV, WHR, USD, ATW, ATI, SNDK, DOW, NYX, USO, BYI, A, ZION, CSTR, JEC, FLS, TIE, ICE, BAC, AMX, PNC, WFMI

Earnings Coming: PCLN, TIE, NYX, WFMI, DOW, CAM, AGU, ATW, ICE, CREE

Setups to watch on Tuesday: GS, UAUA, CAL

Guidance:
SPX bounces, breaks out and closes above its 1,115 resistance level...
Bull flag breakout pattern entry…
The SPX makes highest close since May 17…
The VIX did confirm the higher close in the SPX, and stayed below 25.
Breadth was stronger as advancers led decliners 5 to 1 on the NYSE.
SPX price target is still 1,141…

Price did bounce above Friday’s high. Did you follow your rules for entry?

SPX
Resistance: 1,130, 1,141
Support: 1,115, 1,100, 1,086

Enter strong stocks up with a break above the high of the low day. Stay with stocks in a bounce continuation.

Most stops on bearish trades should have closed according to your rules. Wait for a break of the low of the high day for bearish entries.

The VIX fell -1.49 and closed at 22.01, the lowest close since May 3. Volatility closed well below the important 25 level confirming the current up trend since July 7.

The short term 3 day trend is up.
The two-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend of the chart and follow your rules.

AAPL +4.60 – confirm inverted hammer
QCOM +0.68 – confirm hammer in bull flag
GOOG +5.56 – confirm bullish harami in bull flag
BIDU +3.19 – trend continuation
NDX 100 stocks stronger than the NDX include: NIHD, FWLT, NWSA, LIFE, ADSK, SHLD, NTAP, BIDU, ERTS, GILD, BBBY, TEVA, CSCO, DISH and LOGI.

Stocks weaker than the NDX: AKAM, RIMM, VRSN, ORLY, SBUX, LLTC, NVDA, ROST, HANS, CMCSA and IACI.

Stocks to Watch on Tuesday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, VECO, ATW, DOW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, DLR, FFIV, GR, LVS, SPG, UNP, URE, CMG, FAS, STI, WFMI, DECK, HAS, NYX, LXK, UNG, DHR, SKX, UCO, USO, ZION
Moving Above 30 DMA = 6
ATI, CSTR, NETL, PNC, SNDK, USD
Moving Below 30 DMA = 2
MA, SKX
Staying Below 30 DMA
AMD, BYI, V, A, JEC, NTRI, FAZ, NFLX, ESI, HSY, BAC, MHS, WHR, SWN, ICE

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Up

The Answer? SPX Did Bounce as was Most Probable...on Monday...