Financial Stocks Lead SPX to a New High Close...

DJIA + 164.80, +1.96% SP500 + 21.84, +2.41% NASDAQ Comp. + 22.76, +1.33% Russell 2000 + 18.88, +3.83% Exchange NYSE NASD Advancing 3,191 2,113 Declining 580 701 Oil $58.63 +$1.92 Gold $914.40 -$0.60 SOX 249.65 -4.90 VIX 32.05 -1.39 The VIX moved down and did confirm the move up in the SPX on Friday. This is the lowest close on the VIX since September 16, 2008. Strongest Sectors: XLF +7.43%...XLE +4.26%...XLI +3.66% Weakest Sectors: XLK -0.12%...XLP +1.29%...XLU +1.45% Eight of nine Sectors moved higher on Friday. Financials, Energy and Industrials were stronger than the SPX +2.41% on Friday. These same three sectors led the market higher for the week: XLF +22.25% XLE +9.69% XLI +6.86% Financial stocks stronger than XLF +7.43% include: ZION, RF, PNC, STT, AFL, WFC, MET, JPM AXP, BK and ETF’S UYG and FAS. Leading tech stocks stronger than XLK, -0.12% include: EBAY, GOOG, EMC, MA, YHOO, ADP, MSFT, HPQ, AMAT, AAPL and VZ. Stocks weaker include: INTC, DELL, AMT, TXN, QCOM, CSCO, IBM and ADBE. Sector Watch Up Trending: Horizontal Breakout: XLB, XLK, XLY Sideways: XLE, XLV, XLF, XLP, XLI Down Trending: XLU Financial stocks soared on Monday, Wednesday and again on Friday. Energy stocks also were strong on Monday Wednesday and Friday. Technology stocks were the only sector down for the week losing -2.23%. Industrials, Transportation and Healthcare each gained 6%+ for the week. The Nasdaq which was the first of the broad indices to break above its 200 DMA on Monday, closed less that three points below that level on Friday. It is clear that traders have rotated at least temporarily from Tech stocks to Financials and Energy. XLF closed 51 cents below its 200 DMA and XLE touched its 200 DMA on Friday before closing 36 cents below. The SPX, RUT and DJIA are still trading below their 200 DMA. Key resistance levels on the SPX are: 944 = horizontal 954 = 200 DMA 957 = short term chart target Key support levels: 904 = weekly S1 891 = 38.2% Fib level 875 = horizontal Going into next week the positives are the trend is up, the SPX made a new high close on Friday, the VIX made a new low close and trading rotated from Technology to Financials rather than the broad index selling off. The negative is that the index is near horizontal, 200 DMA and short term chart target resistance levels. These of course are levels where selling typically appears as is evidenced by weakness in the Nasdaq and XLK this week. Keep in mind the pattern of the past nine weeks of one to two thrust days and one to two pause days which continued this week. There is little technical evidence on the chart as of Friday to suggest a reversal of the nine week up trend or an end of the alternating one to two day pattern. Monday is as probable to be a pause day as it is to be a thrust day. Trade the trend and watch for a pull back to support levels. Index Commentary The DJIA…large white candle did NOT confirm Thursday’s dark cloud cover…again closed above horizontal resistance at 8,405…three month chart target 10,340…volume slightly above average at 428 million shares…closed above its 20, 30 and 50 DMA. The SPX…large white candle that did NOT confirm Thursday’s dark cloud cover…25 points below 200 DMA…3 month chart target of 1,075…closed above its 20, 30 and 50 DMA. The Nasdaq formed a bullish harami hammer below its 200 DMA…failed to achieve short term chart price target of 1,765…3 month chart target of 2,065…closed above its 20, 30 and 50 DMA. The RUT formed a large white candle with no follow through on Thursday’s bearish engulfing counter trend pull back…new high close…3 month chart target 606…closed above its 20, 30 and 50 DMA Check back early Monday for our At the Open on Monday List At the Open on Friday Performance The Nasdaq continued to under perform the SPX +2.41% on Friday. Ironically, even SPY had a slightly lower return than the SPX on Friday. As a result just 10 of our 18 stocks had a higher return than the SPX on Friday. However, the average return of all 18 stocks was 4.1%...a 70% higher return than the SPX. FAS – white candle inside day +20.30% STT – large white candle 200 DMA breakout +15.65 HANS – white hanging man, resistance break out post earnings +11.80% WYNN – bullish harami +7.35% KOL – white spinning top in horizontal flag +5.15% SCHN – white spinning top in horizontal flag +3.92% EBAY – large white candle above 200 DMA +3.82% SPG – white hanging man after triangle breakout +3.61% MEE – white spinning top in horizontal flag +2.83% DE – bullish harami above 200 DMA +2.53% SPY – white hanging man in horizontal flag +2.33% DHR – doji horizontal flag above 200 DMA +0.62% RIMM – bullish in bull flag +0.56% QLD – bullish harami in bull flag +0.36% ISRG – black spinning top above horizontal break out -0.19% ADBE – black spinning top in bull flag -0.82% SHLD – black spinning top below 200 DMA -1.41% SNDA – black spinning top bull flag or double top? -4.55% Stocks to Watch on Monday Leading Stocks Holding Above 30 DMA BIDU, CLB, ICE, DLB, PWR, VPRT, AAPL, CTSH, AXYS, BAP, CAM, GMCR, JOSB, ATW, GR, SYNA, EBAY, GES, SNA, WRC, HDB, PCP, UYG, FSLR, WCG, RIMM, X, BYI, CBST, HLF, AMX, MHS, WAB, FAS, AFAM, JW.A, K, RBN, ESRX, PCLN, URE, VAR, PCR, PPD, HANS, SWN, FLS, SNHY, TDG, NIHD, RCI, STRA, ACN, AMED, EZPW, JOYG, MON, MUR, PSYS, SPWRA, NTLS, CHL, DECK, MOS, GXDX Moving Above 30 DMA = 2 JEC, MCD Moving Below 30 DMA = 3 DLTR, AMZN, USD Staying Below 30 DMA DECK, ORCL, SYNA, ALGT, JCOM, NFLX, PETS, GME, CPLA, GILD, GPRO, BDX, CBST, MYGN, DV, SLGN, BIIB, WMT, BKC, APEI, BLUD, ESI Intermediate Term Market Trend: Neutral Short Term Market Trend: Neutral