Classic Support Bounce on Tuesday

DJIA + 184.46, +2.17% SP500 + 21.22, +2.44% NASDAQ Comp. + 40.38, +2.67% Russell 2000 + 16.62, +3.57% Exchange NYSE NASD Advancing 3,134 2,000 Declining 752 930 Oil $39.03 -0.99 Gold $869.30 -$5.30 SOX 211.26 +9.31 VIX 41.63 -2.27 The VIX moved down confirming the rise in the SPX on Tuesday. Strongest Sectors: XLF +3.85%...XLY +3.77%...XLI +3,72% Weakest Sectors: XLU +1.53%...XPI +1.59%...XLK +1.87% Sector Watch Up Trending: Sideways: XLE, XLP, XLU, XLY, XLV, XLI, XLB, XLK, XLF Down Trending: The support bounce that we discussed in our webcast on Monday evening occurred on Tuesday. The market continued trading light volume slightly higher than on Monday just as we had expected. All nine ETF sectors moved higher on Tuesday. All nine sectors have now been in a sideways trading range or sideways trend for 4 weeks or more and are now listed as Sideways in our Sector Watch. The rally was reasonably broad for the light volume holiday shortened trading week as advancers led decliners 4 to 1 on the NYSE. On the Nasdaq advancers led decliners 2 to 1. In our Stocks to Watch list there were 12 stocks crossing above the 30 DMA to just one crossing below. Our Action watch list had 24 stocks Moving Up and 2 Moving Down. We mentioned last night the fact that the SOX PHLX Semiconductor Index was essentially flat on Monday was a bullish clue. We set up a virtual trade on MRVL with a buy stop at 6.62 which filled on Tuesday. We also showed charts on TXN and BRCM and mentioned they were also attractive setups. The SOX, MRVL, TXN and BRCM all had classic support bounce entries today. Stocks to Watch on Wednesday Leading Stocks: Holding Above 30 DMA AYE…PCLN…BAP…DLTR…FLR…JCOM…JEC…PCR…ATK…B…IRIS…SNA…WMS…HAS…JOSB…AMZN…BIIB…BYI…HDB…LFC…PSSI…CERN…FWLT…MTW…QSII…VMI…OI…FLS…BCO…NDAQ…ROST…VIVO…AET…ESRX…UTX…APH…CAM…CCC…CIR…CL…DECK…DV…EPR…ESI…GES…GILD…JW.A…MYGN…NOV…ACL…BLUD…DNA…HLF…OSIP…AGN…KEX…LAYN…RCI…CELG…NEU…PSYS…RIO…SHW…AMED…PETS…SOHU…SPTN BCR…CAM…FLIR…NGS…NOV…SPN…WAB Moving Above 30 DMA = 12 AFAM…ANSS…CHTT…CTSH…FSTR…GME…IIVI…K…MCRS…NIHD…PCP…SWN Moving Below 30 DMA = 1 CHU Staying Below 30 DMA SWN…MMM…STRA…AME…GIS…PTNR…TECH…AXYS…MON…MTD…URBN…ICLR…LNN...AAPL…TECH…EZPW…MOS…POT…PPD…RTN…SINA…TEVA…WCG…MBT…PRGO…RIMM…NILE…AMX…CBST…PPD Tuesday’s Action Moving Up: STRA, GS, X, AFAM, PCLN, HANS, SCHN, AGU, NDAQ, NUE, SOHU, ZION, CLF, MON, PNRA, KRE, GRMN, JASO, KMT, CF, BRCM, NIHD, KBE, ANR Moving Down: V, ESRX, Intermediate Term Market Trend: Neutral – DJIA, SPX, Nasdaq, RUT Short Term Market Trend: Neutral