Stocks Bounce...Interest Rates Unchanged...

DJIA 10,236.16 +41.87 +0.41% SP500 1,097.50 +5.33 +0.49% COMPQ 2,221.41 +17.68 +0.80% Russell 2000 618.38 +6.22 +1.02% Exchange NYSE NASD Advancing 1,518 1,598 Declining 1,525 1,072 Oil $73.67 -1.04 Gold $1,084.50 -13.90 SOX 337.45 +3.93 VIX 23.14 -1.41 Index - Direction - Confirmation VIX - Down - Yes = SPX SOX - Up - Yes = COMPQ Strongest Sectors: XLF +2.43%…XLK +0.83%...XLV +0.70% Weakest Sectors: XLB -0.86%...XLU -0.66%...XLE -0.39% Six of nine sectors moved higher on Wednesday. Financials, Technology and Healthcare were stronger than the SPX +0.49%. Sector Watch Up Trending: XLK, XLB, XLY, XLV, XLP, XLE, XLI, XLU Horizontal Breakout: XLF Sideways: Down Trending: Key Resistance Levels: 1,101 = October High 1,105 - 1,113 = November High 1,119 = December High 1,025 - 1,133 = 1,075 BO chart target - Sep 08 Low 1,145 = 1,133 BO chart target – Dec 31 Low 1,155 = chart target Key Support Levels 1,087 = Nov 10 Channel low 1,082 = Nov 9 S1 level 1,075 = 875 Breakout Chart Target1,050 = Oct 08 High Stocks stayed in a narrow trading range until after 2:15 pm ET when the Fed announced no change in interest rates. No surprise here but traders like to wait just to make sure there are no negative surprises. Once the Fed business was completed the SPX rose 13 points to close at 1,097.50. This morning we had about 450 traders in an AT webcast where I discussed this concept of traders waiting for the Fed and I asked questions about their trading results. I asked, if they believed if their 2009 trading results were impacted by their feelings and thoughts through out the year? Close to 300 responded in the affirmative. I asked, if they followed rules without regard for those thoughts and feelings did they believe their results would be better? Close to 300 responded again in the positive. A large majority believed that when the market was in an up trend or sideways trend that a bounce at support was more probable than a support break was. And a large number acknowledged that their thoughts and feelings might interfere with entering trades near support. After this series of questions and responses I encouraged the group to take a real time virtual trade based on an objective entry near support without regard for those thoughts and feelings. By doing so they could begin a new action based on what technical analysis suggested was probable rather than those thoughts and feelings that held them back. You should consider doing the same. The 1,090 support area held for the fourth straight day and the SPX formed a hammer like pattern after making a short term low at 1,083.11. On Wednesday BA gained 4.22 or 7.31% and GILD +3.17 or +7.06% after reporting earnings. ALTR +1.23 or +5.80% on positive earnings led semiconductors higher. AMAT, MU, SNDK, TER, MRVL, AMD and INTC had larger than average moves. After the Close GMCR was +1.73 or +2.16% on strong earnings. SYMC -0.86 or -4.62% QCOM -4.74 or -10.04% Both had solid earnings but lowered guidance looking forward. Continue to watch earnings reaction this week. Thursday’s Earnings to Watch: MMM, AMZN, BDX, CA, CELG, CHKP, DHR, GR, JBHT, KLAC, LIFE, LUV, LMT, MSFT, MXIM, POT, PG, RTN SNDK, TROW, LCC, VPRT A number of up trending stocks held at support and began to bounce on Wednesday. Look at these Charts… (click image to enlarge) Look at these Charts… (click image to enlarge) Guidance: The SPX bounced off the 1,090 support area. The multi-month trend is up. The multi-week trend is sideways. A support bounce at this level provides short term support bounce entries. Look for support bounce entry opportunities. Continue to focus on and trade setups on the charts of the stocks you watch and follow your rules. If you have not yet been stopped out of your up trending positions, continue to raise your stops. If 1,090 support area breaks, the next level of SPX support is 1,075 and then 1,050. Look for down trending setups on stocks that have shown reversal patterns or that are breaking support if the SPX breaks support. AAPL +1.94 QCOM +0.31 GOOG -0.32 BIDU +4.98 NDX 100 stocks stronger than the NDX include: FLEX, GILD, ALTR, APOL, ATVI, RIMM, AMAT, AMZN, NVDA, MXIM, ERTS, LINTA, ILMN, AMGN, ROST, LRCX, PCLN, WCRX, JBHT, MRVL, GRMN, INTC, BIDU, CTSH, ISRG, BIIB, CSCO, DTV, XLNX, FISV and IACI. Stocks to Watch on Thursday Leading Stocks Holding Above 30 DMA ALGT, UAUA, CBST, SNDK, AMED, GMCR, HANS, ESI, VAR, BA, CEDC, ZION, K, MCD, FAZ, CHL, DLB Moving Above 30 DMA = 4 DECK, JEC, MA, WFC Moving Below 30 DMA = 1 BYI Staying Below 30 DMA ACN, FLS, TDG, UNG, BUCY, DE, DOW, FAS, HLF, SYNA, UNP, UYG, X, ATW, CAM, HDB, MHS, MOS, PCP, GR, URE, GS, HEAT, WHR, CAT, FCX, BAC, DHR, AGU, FUQI, ICE, IPI, SWN, USO, WLT, WMT, BKC, WAB, USD, PWRD, AMD, AMX, CGA, GES, MON, POT, TSL, BDX, MYGN, WCG, SPG, VPRT, GME, MELI, PCLN, NFLX Intermediate Term Market Trend: Up Short Term Market Trend: Neutral