Yellow Alert Turns Red on Thursday...

DJIA - 129.91, -1.54% SP500 - 15.14, -1.68% NASDAQ Comp. - 32.59, -1.89% Russell 2000 - 8.13, -1.66% Exchange NYSE NASD Advancing 979 799 Declining 2,717 1,939 Oil $61.05 -$0.99 Gold $951.20 +$13.80 SOX 250.40 -6.59 VIX 31.35 +2.32 The VIX moved up and did confirm the move down in the SPX on Thursday. Strongest Sectors: XLF +0.17%...XLV -0.90%...XLP-0.91% Weakest Sectors: XLF -2.66%...XLU -1.82%...XLY -1.08% Financials, Healthcare, Consumer Staples and Utilities were stronger than the SPX -1.68%. XLF was the only positive sector on Thursday. Financial stocks stronger than XLF: STT, WFC, CME, BK, ALL, TRV, CB, NTRS, JPM, C, AXP, GS, ICE and MS. Leading tech stocks stronger than XLK -1.75% include: MA, ADP, GOOG, EMC, YHOO, IBM, ADBE, HPQ, AAPL and SYMC. Sector Watch Up Trending: Horizontal Breakout: XLB, XLK Sideways: XLY, XLE, XLV, XLF, XLP, XLI Down Trending: XLU SPX Key resistance levels: 902 = Weekly R1 930 = horizontal 945 = 200 DMA Key support levels: 891 = 38.2% Fib level 879 = 50% Fib level, 30 DMA 866 = 61.8% Fib level Wednesday’s Yellow Alert turned Red for short term traders as stocks continued to move lower on Thursday, breaking below Wednesday’s low. Wednesday was the high day and that is why we had the Yellow Alert going into today. The SPX fell to its 50% Fib retracement and 30 DMA area, 879, where buyers stepped in about an hour before the close and drove the SPX back to its 38.2% Fib level closing with a full house at 888.33. Gold prices rose in part due to a falling dollar. Gold stocks GDX, GLD, NEM, GLD, AEM, GOLD and GG all moved higher.

The SPX and DJIA broke their 20 DMA and fell to their 30 DMA before rallying during the last hour of trading. The Nasdaq and RUT broke below their 30 DMA before rallying to close at their 30 DMA. Watch for a potential break of the 30 DMA or last week's short term horizontal support.

Check out these charts...

(click image to enlarge)

Index Commentary The DJIA formed a black candle with lower shadow starting at 8,221 which was at its 30 DMA and near last Friday’s low, short term horizontal support …fell below horizontal resistance at 8,405…three month chart target 10,340…volume was slightly below average at 392 million shares…closed just below its 20 DMA and above its 30 and 50 DMA. The SPX formed a black hammer like pattern breaking its 20 DMA and falling to its 30 DMA…3 month chart target of 1,075…closed just below its 20 DMA and above its 30 and 50 DMA. The Nasdaq formed a black candle with a lower shadow…3 month chart target of 2,065…closed below its 20 DMA and 200 DMA and above 30, and 50 DMA. The RUT formed a black hammer like pattern that broke below its 20 and 30 DMA….3 month chart target 606…closed a fraction below its 30 DMA and above its 50 DMA Stocks to Watch on Friday Leading Stocks Holding Above 30 DMA BIDU, CLB, ICE, DLB, VPRT, CTSH, BAP, CAM, GMCR, ATW, GR, SYNA, EBAY, TRLG, FSLR, HDB, PCP, RIMM, WCG, UYG, HLF, AMX, MHS, FAS, AFAM, K, PCLN, VAR, PCR, PPD, SWN, FLS, TDG, NIHD, RCI, STRA, ACN, JOYG, MON, MUR, PSYS, CHL, DECK, MOS, DV, AXYS, BIIB, BYI, CPLA, SPWRA, SYNA, X, ESI, MCD, BDX Moving Above 30 DMA = 0 Moving Below 30 DMA = 7 AAPL, CBST, ESRX, HANS, RBN, USD, WAB Staying Below 30 DMA URE, NTLS, JOSB, AMED, PETS, GES, WRC, SNA, SNHY, WMT, AMZN, EZPW, GXDX, JW.A, JEC, PWR, DLTR, DECK, ORCL, ALGT, JCOM, NFLX, GME, GILD, GPRO, MYGN, SLGN, BKC, APEI, BLUD Intermediate Term Market Trend: Neutral Short Term Market Trend: Down