SPX Pulls Back to Support....

DJIA                           10,066.57 -126.82 -1.24%
SP500                           1,073.65  -14.04 -1.29%
COMPQ                        2,213.55  -15.49 -0.69%
Russell 2000                    641.21   -8.08 -1.24%

Exchange                  NYSE              NASD
Advancing                  1,189                935
Declining                    1,913             1,756

SPX Key Resistance Levels

1,087 = Nov 10 Channel low
1,101 = October High
1,105 - 1,113 = November High
Key Support Levels

1,075 = 875 Breakout Chart Target
1,044 - 1,050 = Feb 8 low, Oct 08 High

The SPX failed to break Thursday's R1 resistance at 1,089 for the second straight trading day. Monday's pull back sets up a test of last Friday's low of 1,055. If that support is broken on Tuesday look for prices to fall to the 1,044 level.
 
As of Monday's close the SPX MACD Divergence is still valid so we are still prepared for support to hold and traders should continue to trade down trending charts down. NDX stocks including AAPL, GOOG, BIDU and QCOM sold off from their earlier highs. Even up trending stocks formed potential high days on Monday, so be willing to raise stops if prices move lower on Tuesday as I discussed in Monday evening's webcast.
 
Guidance:

The SPX formed a large black candle reversing half of Friday's piercing line candle. Watch Friday's 1,055 support low for a potential break.

Trade weak stocks down. Continue to trade the bounce off resistance and a break of support to the next support level.

Trade strong stocks up. We saw some entry signals on Friday with the support bounce. Early Monday a support bounce continuation move did occur until about 1 pm but failed to stay above Thursday's R1 at 1,089 . The last three hours of trading saw prices move lower towards support.

The VIX fell -1.78 and closed at 38.32. On Thursday the VIX made it highest close since March 20, 2009.

The short term trend is down.
The six-month trend is neutral.
The twelve-month trend is up.

Continue to focus on and trade setups on the charts of the stocks you watch, trade with the trend and follow your rules.

Adjust your stops according to your rules for up and down trending trades.

AAPL +4.44
QCOM -0.22
GOOG +5.11
BIDU +0.15
NDX 100 stocks stronger than the NDX include: IACI, TEVA, AAPL, GOOG, PCLN, LIFE, DELL, URBN, ORCL, YHOO, AMGN, VRTX, AKAM, NIHD, BIDU, ADSK, FLEX, PPDI, ATVI, CEPH and JBHT.

Stocks weaker than the NDX: MRVL, FSLR, FWLT, RIMM, NVDA, LOGI, LRCX, XLNX, WCRX, WYNN, ERTS, LINTA, KLAC, JOYG, CERN, EXPD, MSFT and MCHP.

Stocks to Watch on Monday
Holding Above 30 DMA
EXBD, NTRI, FAZ, NFLX, SNDK, OSTK
Moving Above 30 DMA = 1
WFMI
Moving Below 30 DMA = 1
ESI
Staying Below 30 DMA
HAS, BYI, DHR, GR, MCD, UNG, WHR, WMT, ICE, ZION, CRM, STI, PNC, AIV, HLF, AMD, ATI, CAT, CREE, DECK, LVS, SPG, SWK, UNP, URE, WFC, BA, DE, JEC, LXK, CHL, GME, SYNA, HANS, ACN, MYGN, AMX, BKC, DOW, FAS, FLS, PCLN, PCP, TSL, UAUA, USD, USO, UYG, ATW, BAC, GES, MA, V, CAM, SWN, BUCY, WLT, CLF, MHS, WCG, GMCR, GS, FCX, X, PWRD, AGU, IPI, POT, MOS

Intermediate Term Market Trend: Neutral
Short Term Market Trend: Down