SPX Breaks 1,018 High with a New High Close at 1,026...

The SPX makes a new close high at 1,026.13 as it reaches our price target from the July break out of 950 Resistance. The NDX and NDX 100 stocks AAPL, GOOG, ADP, BIIB, CA, CHRW, CTAS, HOLX, LBTYA, LOGI, NVDA, PAYX, PCAR, PDCO, ROST, SBUX, STX and XLNX all made a new high close on Friday. DJIA + 155.91, +1.67% SP500 + 18.76, +1.86% NASDAQ Comp. + 31.68, +1.59% Russell 2000 + 12.83, +2.26% Exchange NYSE NASD Advancing 2,467 1,999 Declining 585 715 Oil $73.89 +$0.98 Oct. contract Gold $953.20 +$12.90 SOX 301.30 +4.89 VIX 25.01 -0.08 The VIX moved down and did confirm the move up in the SPX on Friday. The SOX confirmed the move up in the Nasdaq. Strongest Sectors: XLE +2.83%...XLB +2.64%...XLI +2.60% Weakest Sectors: XLV +1.02%...XLP +1.10%...XLK +1.46% All nine sectors moved higher for the second day in a row on Friday. Energy, Materials, Industrials, Consumer Discretionary, Financials and Utilities were stronger than the SPX +1.86%. Financial stocks stronger than XLF +1.96%: RF, C, KEY, AFL, MET, PRU, ZION, ALL, JPM, PNC, TROW, SCHW, IVZ and ETFs UYG and FAS. Tech stocks stronger than XLK +1.46%: EBAY, MSFT, ADP, ADBE, VZ, MA, AMAT, HPQ, T, TXN and AAPL. Sector Watch Up Trending: XLK, XLB, XLY, XLV Horizontal Breakout: Sideways: XLE, XLF, XLP, XLI, XLU Down Trending: SPX Key resistance levels: 1,025 = 950 Breakout Chart target 1,044 = October horizontal 1,075 = 875 Breakout Chart target Key support levels: 1,007 = Nov horizontal resistance 992 - 996 = recent support low 980 = last broken resistance now support 962 = July 23 S1, 30 DMA, 38.2% Fib extension 944 – 956 = old January/June/July resistance

Let’s Get This Straight… The SPX is in an up trend. The Nasdaq, DJIA and RUT are also in up trends. I prefer the term up trend to bull market in part because of the psychological trap that many traders fall into in defending their opinion of whether a given market is a bull or bear market. I have labeled the Nasdaq market in an intermediate term up trend, or bull market if you wish, since it broke through its October resistance at the 1,950 level. This week the Nasdaq returned to 1,950 and bounced to a new high at 2,020.90 in just three days, confirming its up trend or bull market.

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That is support. When price comes to an old resistance (new support) level and bounces with strength that is strong support. Buyers appear and price moves fast. That is also exactly what takes place in an up trend or bull market. In one sense the SPX, DJIA and RUT have all be in an up trend since March and can be labeled an intermediate term up trend. I have however continued to list their intermediate term trend as Neutral. Why? The SPX, DJIA and RUT have been labeled Neutral because they have continued to trade below their October resistance level. My reasoning is this; if an index cannot overcome the selling level that was the rebound high resistance after the index went tumbling down, then buying may not be any stronger than the buying in October before the index fell to lower lows. Here’s the good news. As an index rises above the October resistance it is showing stronger buying than existed in October and that is a strong indication that the longer intermediate term trend is up. Or if you prefer you can call it a bull market. Just because it is an up trend or bull market doesn’t mean there won’t be corrections or congestion areas and that sellers won’t continue to appear at resistance. Sellers will be there and stocks will pull back and as long as they pull back to higher lows and bounce to higher highs the up trend will continue. The RUT is next closing on Friday just 3 points below its October higher. If it closes above 584.70 and stays above that level it will be in a longer intermediate term up trend or bull market.

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The SPX is 18 points below its October resistance high of 1,044.31. Closing and staying above this level will be a longer intermediate term up trend in the SPX.

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The DJIA is 289 points below its October resistance high of 9,794.37.

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DJIA volume surged 94% from 151 million shares on Thursday to 293 million on Friday and traded at 150% of 20 day average volume. Friday’s breakout was accompanied by higher volume adding validity to the breakout. While volume increases were not across the board on the Nasdaq some larger stocks saw volume increases like MSFT +77%, EBAY +73%, ORCL +38% GOOG which had a volume surge on Thursday was +56% above Wednesday’s volume.

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So let’s get this straight…there is absolutely no need to be confused. What you are looking at in these charts is an up trend with a strong support bounce. Many stocks continued their bull flag support bounces and moved towards T1 and a Breakout Setup. Guidance: The intermediate term trend is still up. The strong support bounce off of 980 blew right through the 1,007 to 1,018 resistance level on Friday. Since this is the first time this year the SPX is at the 1,026 level we don’t know if institutions will continue buying on Monday or step back to see how much selling is here. On Monday be prepared for a continuation move and for the potential of a flag pull back. Flag Setups and Bounces in Progress: JCI, WYNN, JOYG, GRMN, AGCO, AGU, X, SPG, DE, DOW, CERN Breakout Setup: MA, DD, CAT, BDK, FWLT, AXP, BAC, FLS, JCG, JEC, HOLX, STT, WHR, WLT, ZION Key stocks BA, CAT, DD, DIS, GE, HD, JPM, MRK, MSFT, PFE and UTX were strong on Friday. AAPL +2.89 QCOM +0.20 GOOG +4.83 BIDU +5.75 NDX 100 stocks stronger than the NDX included PCAR, EXPD, CHRW, FWLT, EBAY, MSFT, JOYG, BBBY, ADP, WYNN, INFY, RIMM, ISRG, ADBE, GENZ, MICC and CERN. Our real time virtual trades since July 23 in GOOG, SPY, XLB, ZION, BAC, XLF, MA and BDK continue to perform very well. GRMN has moved back positive without hitting its stop. We closed the August SPY trades with nice gains. Stocks to Watch on Monday Leading Stocks Holding Above 30 DMA PWRD, CPLA, ACN, PSYS, MHS, AMED, AMX, BYI, CTSH, AAPL, PETS, USD, FUQI, JOSB, BAP, CAM, EBAY, FAS, NIHD, PCLN, SNHY, TDG, UYG, WRC, ESI, MOS, WCG, SNA, X, CBST, WAB, BLUD, CLB, JOYG, PCP, URE, WMT, EZPW, RBN, AFAM, FLS, VAR, BKC, DV, GR, CLB, HANS, JEC, HLF, BIIB, VPRT, ATW, GES, HDB, ORCL, STRA, MON, APEI, MUR, NFLX, BIDU, DECK, ESRX, GPRO, GXDX, ICE, JW.A, RIMM, TRLG Moving Above 30 DMA = 9 BDX, DLTR, K, PWR, RCI, SLGN, SWN, VPRT, MCD Moving Below 30 DMA = 2 CHL, DLB Staying Below 30 DMA GME, JCOM, SPWRA, AMZN, GMCR, PPD, MYGN, ALGT, GILD, FSLR, SYNA, FAZ, NTLS, Intermediate Term Market Trend: SPX, DJIA, RUT = Neutral, Nasdaq = Up Short Term Market Trend: Up