Small Caps Rise as SPX Pauses...

DJIA - 18.89 -0.18% SP500 + 0.38 +0.03% COMPQ + 9.22 +0.42% Russell 2000 + 6.89 +1.17% Exchange NYSE NASD Advancing 1,982 1,681 Declining 1,029 1,060 Oil $76.60 -2.07 Gold $1,212.00 +12.90 SOX 324.69 +5.15 VIX 21.12 -0.80 The VIX moved down and did confirm the move up in the SPX on Wednesday. The SOX moved up and did confirm the move up in the COMPQ. Strongest Sectors: XLU +1.35%...XLB +0.97%...XLY +0.31% Weakest Sectors: XLE -0.59%...XLI -0.29%...XLV -0.22% Three of nine sectors moved higher on Wednesday. Utilities, Materials and Consumer Discretionary were stronger than the SPX +0.03%. Sector Watch Up Trending: XLK, XLB, XLY, XLV, XLP, XLE Horizontal Breakout: XLF, XLI, XLU Sideways: Down Trending: Key Resistance Levels: 1,105 - 1,115 = October High 1,025 - 1,133 = 1,075 BO chart target - Sep 08 Low Key Support Levels 1,087 = Nov 10 Channel low 1,082 = Nov 9 S1 level 1,075 = 875 Breakout Chart Target 1,061 = Sep 16 S1 level 1,056 = Sep 25 R1 level 1,044 = October Horizontal Old Resistance The SPX made a new intra-day high reaching 1,115.58 before closing at 1,109.24, just a point and a half below its recent 52-week on Nov. 25. Sellers appeared at horizontal resistance and sent the index to close near 1,109 for the second straight day. On Tuesday we brought to your attention GES which broke out of horizontal resistance after positive earnings gained another +1.53% and SNDA -0.77% which pulled back to Tuesday S1 level before rallying to close above its open. The Ag related stocks POT, MOS, AGU and MON whose charts we shared last night broke out of resistance and had strong up day on Wednesday. CREE also had another big day after its horizontal resistance breakout on Tuesday. Price targets are 52 and 54. We closed half of virtual position, 25 Dec 50 call contracts this morning for 135% gain since entering the trade on Nov. 10. The second half of the position entered the same day at 95 cents, closed on Wednesday at 2.50 with a gain of 163%. We raised the stop to 50.26. The RUT and SOX which have been weaker and forming a symmetrical triangle over the past 6 weeks had relatively strong moves today, providing two more clues that the SPX may be headed higher in the near future. Check out these charts: (click image to enlarge) Guidance: The SPX is in a short term neutral trend pinned up against resistance. From here the SPX will either breakout of resistance or fall to support. Additional clues of a breakout include the relative strength of the RUT and SOX on Wednesday, the formation of an ascending triangle in the indexes and the SOX ascending triangle breakout. Many individual stocks like CREE, POT, MOS, AGU, IPI<> and V have broken out of horizontal resistance on Tuesday or Wednesday also increasing the probabilities of a SPX breakout. Continue to focus on and trade setups on the charts of the stocks you watch and follow your rules. AAPL -0.74 QCOM +0.00 GOOG -2.36 BIDU -0.83 NDX 100 stocks stronger than the NDX include: LRCX, STX, KLAC, MRVL, NVDA, JBHT, FAST, AMZN, CHRW, LBTYA, STLD, WCRX, CERN, CLEG, FLIR, HSIC, FLEX, EXPD, XRAY, CEPH, MCHP, PDCO, GRMN, YHOO, PAYX, APOL, TEVA, LLTC, MXIM, ORCL, ISRG, AKAM SHLD, BRCM, AMAT, CTSH and INTU. Stocks to Watch on Thursday Leading Stocks Holding Above 30 DMA K, JW.A, AMZN, SLGN, NFLX, MCD, DLB, RCI, ESRX, MHS, WCG, ALGT, BDX, VAR, ACN, CTSH, HLF, AFAM, AMX, GR, SNHY, SYNA, WMT, DLTR, GILD, HDB, ORCL, WAB, BIDU, EZPW, PCLN, GXDX, PCP, MON, MOS, TDG, X, BIIB, NTLS, AMX, PETS, NIHD, VPRT, ICE, PSYS, EBAY, URE, BLUD, CLB, DECK, GES, GPRO, USD, UYG, WRC Moving Above 30 DMA = 7 BAP, BKC, CBST, CPLA, JOSB, MYGN, SNA Moving Below 30 DMA = 2 JOYG, PWRD Staying Below 30 DMA AAPL, GME, FAZ, BYI, CHL, FLS, DV, RBN, SLGN, WAB, ATW, CAM, FAS, PPD, JEC, GMCR, JCOM, MUR, RIMM, SWN, HANS, STRA, TRLG, AMED, FSLR, APEI, PWR, SPWRA, ESI, FUQI, Intermediate Term Market Trend: Up Short Term Market Trend: Neutral