Rally Slows Down on Tuesday

DJIA + 36.08, +0.43% SP500 + 5.58, +0.66% NASDAQ Comp. - 7.67, -0.50% Russell 2000 + 6.38, +1.46% Exchange NYSE NASD Advancing 2,505 1,597 Declining 1,195 1,255 Oil $50.77 -$3.73 Gold $819.50 +$0.00 SOX 187.02 -4.18 VIX 60.90 -3.80 Strongest Sectors: XLF +5.83%...XLB +3.67%...XLU +1.99% Weakest Sectors: XLP +0.56%...XLV +0.66%...XLY +1.26% Sector Watch Up Trending: Sideways: XLE, XLP, XLU Down Trending: XLF, XLY, XLV, XLI, XLB, XLK The DJIA, SPX and RUT moved higher on Tuesday, however, upward momentum slowed down. With the Thanksgiving holiday on Thursday and a half trading day on Friday, which is traditionally the lightest trading volume day of the year, this is not overly surprising. Many traders will close positions out on Wednesday and not return until next week. The fact that profit taking did not push the indices below Monday’s S1 level shows that buyers are still in control. If markets move below Tuesday’s low or Monday’s S1 level, some traders will view this as an opportunity to take profits on short-term bullish trades. The Financial Sector, XLF, was the strongest sector again on Tuesday gaining more than 20% over the past two days. Airline stocks had positive gains on Tuesday with LCC and DAL gaining more than 14% and UAUA up over 24%. The SPX closed above its Oct. 10 low for the second straight and is trading in its sideways trend of the past 6 weeks once again. The Nasdaq and RUT are still trading below their October lows. Index Commentary The DJIA formed a white spinning top…sellers appeared at 8,600 level for the second day in a row…closed above its Oct. 10 intraday low for third straight day…watch R3 from Wednesday…8,500 continues as an important intermediate resistance level. The SPX formed a white spinning top…closed above Oct. 10 low for the second straight day…sellers appeared the 865 area for the second day…840 continues as a key support area and 915 a key resistance area. The Nasdaq formed a black spinning top…sellers came in at the 1,486 level…1,500 continues as a key resistance area…still trading below Oct. 10 and 24 lows. The RUT formed a potential hanging man pattern…closed above its Oct. 28 low…450 is still a key resistance area…still trading below Oct. 10 low. Stocks to Watch on Wednesday Leading Stocks Holding Above 30 DMA TEVA… AXYS…AYE…CL…DV…EZPW…MMM…PCLN…PPD ANSS…ASIA…BAP…CBST…DLTR…ESI…FLR…FSTR…PRGO…RCI…SHW...TKC…WMS Stocks Moving Above 30 DMA AME…JCOM…JEC…NOV Stocks Moving Below 30 DMA MIG…OSIP…SWN Stocks Staying Below 30 DMA RTN…AFAM…MYGN…VIVO…AOB…CERN…CHTT…FLIR…GILD…GIS…PSSI Tuesday’s Action Moving Up: STRA, BIDU, MA, FSLR, MON, GS, PNRA, HANS, UAUA, CNX, CF, LAMR, AEM, FWLT, ANR, PCLN, NUE, GDX, COH, ONXX, SINA, MS, SCHN, ZION, KBE, LCC Moving Down: ESRX, INFY Intermediate Term Market Trend: Neutral – DJIA, SPX, Down – Nasdaq, RUT Short Term Market Trend: Up