Futures Point to a Slightly Higher Open...

Is the SPX near a bottom? Look at the lows in the beginning of August, September, October and look at today's chart...

(click image to enlarge)

1:00 pm ET - SPX makes lower low at 1,029.83 bouncing down from 1,044 resistance and is forming an inverted hammer... I have been alerting readers since October 16 to be alert for a potential pull back to the 1,044 area. Last week that pull back occurred. On Thursday a bounce off of the 1,044 area occurred and then Friday that bounced reversed and many stocks moved lower and the SPX closed at 1,036. If you trade support bounces regularly, you should be aware that this type of price action occurs periodically. This is why we place stops below the low of the low day in a support bounce. If support bounces always went up there would be no need to use stops. I also teach the tighter you have stops the more important it is to have a re-entry rule if you want to be in a stock if it does continue its up trend. In reviewing charts over the weekend and this morning it is clear that certain charts have pulled back more than others. You must realize that while the intermediate trend from March is still up and this pull back is not even a 23.6% Fibonacci retracement. Some individual charts may be transitioning to a sideways consolidation pattern. These charts are still relatively strong: AKAM, AMZN, BUCY, CAT, CREE, DE, DECK, NFLX, ORLY, PNC, SYMC, V Charts still strong and showing some signs of a potential transition to sideways trading range: AAPL, ACN, ADSK, ATW, BDK, FCX, HANS, ISRG, JOYG, NKE, WHR, WLT, XLE If a chart is breaking support you must be prepared to trade it to the downside. 10:35 am ET - the SPX is back above 1,044 and Friday's R1 level which is 1,048...key short term resistance in 1,056, 1,061 and Friday's R2 open of 1,065...after the strong sell of Friday...a support bounce was likely early this week and it is happening this morning...these short resistance levels have to be broken, not necessarily today, but at some point for the up trend to continue...AKAM and BUCY have strong chart patterns and nice support bounces occurring this morning...AAPL and NKE are breaking back above their 30 DMA...it is still early in the day but a lot of our At the Open stocks are setting up nice bull flag bounces with doji, hammers and bullish haramis...SPY is forming a bullish harami also...no guarantees in trading, however in my experience when the first bounce doesn't follow through (Thursday to Friday), the second bounce probabilities are much better...wattch to see if price action can break through key short term resistance levels... BMO – ES +3 and NQ +2 futures are slightly higher in pre-market trading pointing to a slightly higher open. AAPL +1.37, AMZN +0.56, GOOG +2.17 and BIDU +1.58 are higher in pre-market trading The Euro is up 20 pips in overnight trading and oil is quoting up 45 cents in electronic trading. XLE is quoted up 31 cents in pre-market trading. SPX Support = 1,025 Resistance = 1,044…1,056…1,0161 Trading Down: FSLR Trading Up: BUCY, CAT, WLT, FAS, AKAM, POT, JOYG, PCLN, FCX, FAS Look at these Charts… (click image to enlarge) At the Open on Monday SPY – QQQQ – XLE – ATW – V – AAPL – AMZN – BUCY – SNDK – CREE – DECK – NFLX – NKE – FCX – JOYG – CAT – POT – ADSK – BDK – WLT – WHR – ACN – HANS – ISRG – FAS – PNC – AKAM – ORLY – SYMC – PCLN –