SPX Moves Higher...

DJIA +95.61 +1.11% SPX +8.06 +0.86% NASDAQ Comp. +22.13 +1.19% RUT +6.38 +1.24% Exchange NYSE NASD Advancing 2,077 1,677 Declining 875 972 Oil 62.02 +$0.48 Gold 935.40 -$4.00 SOX 287.00 +5.44 VIX 25.42 -0.47 The VIX moved lower and did confirm the move up in the SPX on Thursday. Strongest Sectors: XLI +1.84%...XLK +1.46%...XLY +1.24% Weakest Sectors: XLF -0.33%...XLU +0.04%...XLV +0.64% Eight of nine sectors moved higher on Thursday. Industrials, Technology, Consumer Discretionary, Energy and Materials were stronger than the SPX +0.86%. Financial stocks stronger than XLF -0.33%: AXP, SPG, MMC, GS, BK, AOC, ZION, IVZ, STT, TRV, MET, RF, PRU, USB, NTRS and ETFs UYG and FAS. Tech stocks stronger than XLK +1.46%: EBAY, AMAT, DELL, MA, ADBE, IBM, YHOO, EMC, GLW, INTC, HPQ, TXN and CSCO. Sector Watch Up Trending: Horizontal Breakout: XLB, XLK, XLY Sideways: XLE, XLV, XLF, XLP, XLI, XLU Down Trending: SPX Key resistance levels: 944 – 956 = January/June horizontal 962 = 161.8% Fib extension Key support levels: 930 = horizontal 920 = horizontal end of May high 912 = 50 DMA 878 = 200 DMA 870 -875 = horizontal The SPX rose to 943 before closing at 940.74. This is the SPX’s fourth highest close since November 5, 2008 only surpassed by three trading days in early June. We have maintained for weeks that the current chart pattern was a sideways trading range. Last week when we were loudest solo voice that this was likely a head and shoulders top, most people were licking their chops on the money they were going to make to the downside. We said in our Thursday webcast on July 9, like it or not the technical evidence does not suggest that a break of support is likely. We almost begged people to do the right thing and get long. We were almost the only up trending (what some call bullish) voice out there. We also said that the SPX was not likely to move more than 30 to 40 points unless there was a catalyst that got buyers going. We said that better than expected earnings could be that catalyst. What did the market do? Exactly what was most probable based on the chart. It bounced off of support, ironically with the strongest four day rise we have see since the week of March 9, the first week of the current four month up trend. The catalyst better than expected earning from GS and INTC spurring buying interest in financial and technology stocks including bands and semiconductor stocks. We have maintained for weeks that this sideways consolidation was a trend continuation pattern and that it would most likely resolve to the upside. The SPX is back up to the 940 – 950 resistance area and will need another positive catalyst to push through the two resistance formed in early July. The most likely source again is earnings. Thursday was a high day so it is important to realize if the market does not get another catalyst that today’s low represent an important short term support area for short term traders. While it is too early to say that Thursday’s low will be breached, we need to stay focused on it, if it is broken. Once again Yellow Alert. Friday is options expiration so be prepared for some extra volatility. Key Earnings and Economic Releases Friday: BAC, C Housing Starts Stocks to Watch on Friday Leading Stocks Holding Above 30 DMA PWRD, K, CPLA, ACN, PSYS, MHS, SLGN, AMED, ALGT, PPD, AMX, NFLX, BYI, CTSH, AAPL, BDX, DLTR, ESRX, PETS, USD, BIDU, FUQI, GMCR, GR, HLF JOSB, VPRT, AMZN, ATW, BAP, CAM, DECK, DLB, EBAY, FAS, GES, GILD, JCOM, NIHD, ORCL, PCLN, RCI, SNHY, TDG, TRLG, UYG, URE, WRC Moving Above 30 DMA = 8 AFAM, CLB, ESI, MOS, MUR, WCG, SNA, X Moving Below 30 DMA = 0 Staying Below 30 DMA FAZ, STRA, BKC, APEI, DV, NTLS, HDB, SYNA, CBST, CHL, GXDX, ICE, JW.A, JOYG, MCD, MYGN, PWR, GPRO, JEC, BLUD, RBN, BIIB, FLS, VAR, PCP, SWN, RIMM, SPWRA, MON, EZPW, WAB, FSLR, WMT, HANS, GME Intermediate Term Market Trend: Neutral Short Term Market Trend: Up