SPX Breaks 1,100 Then Rallies to Close Just Above...VIX Closes Lower...

DJIA             10,467.16 -30.72 -0.29%
SP500            1,101.53   -4.60 -0.42%
COMPQ          2,251.69 -12.87 -0.57%
Russell 2000      650.43  -0.33 -0.05%

Exchange       NYSE NASD
Advancing      1,597  1,264
Declining        1,433  1,360

Oil           $78.36 +1.37
Gold   $1,168.40 +8.00
SOX        352.52 -6.95
VIX           24.13 -0.12

Index   Direction  Confirmation
VIX      Down        No – SPX
SOX     Down        Yes – COMPQ

Leading stocks on Thursday included: GMCR, SKX, POT, UCO, CLF, ZION, GS, FLS, AGU, CRUS, UNG, MOS, MHS, USO, SWK, WLT, IPI, CAM, SNDK, HAS, GR, BUCY, DECK, LVS, FFIV, DOW, DHR, NYX, DE, FCX

The SPX and market are in a pull back, at this point a bull flag. On Thursday the SPX made a four day low hits its 10 DMA where buyers stepped in and the market bounced 15 points before closing just above 1,101. Once again the SPX closed just above short term support.


GS is gaining strength as a bellwether financial stock. XLF also bottomed at the same time as GS and may be ready to become a leading sector again which would likely help the SPX break through short term resistance.

Short term traders will trade stocks like A, BYI and JEC to the downside.

Up trending stocks like POT, MOS, AGU, LVS, VMW and FFIV should be traded to the upside.

Setups to watch on Friday: CRUS, CREE, VECO, CRM, DECK, LXK, GES, CLF, GS, PCLN, PCP, CAT

Guidance:
SPX forms an outside day closing above its 1,100 support level...
The SPX makes higher high and lower low in a bull flag pattern.
The VIX did not confirm the lower close in the SPX, and stayed below 25.
Breadth was stronger as advancers led decliners 1.1 to 1 on the NYSE.
SPX price target is still 1,141 recent short term breakout continues to hold.

If price bounces above support follow your rules for re-entry.

SPX
Resistance: 1,115, 1,130
Support: 1,100, 1,086, 1,071

Enter strong stocks up with a break above the high of the low day. Stay with stocks in a bounce continuation.

Take bearish setups according to your rules. Keep in mind that many bearish setups may be counter trend moves so trade accordingly.

The VIX fell -0.12 and closed at 24.13. Volatility closed below the important 25 level again on Thursday.

The short term 3 day trend is neutral pending a close below short term support.
The two-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 of the chart and follow your rules.

AAPL -2.85 – confirmed bearish harami
QCOM +0.02
GOOG +0.64 – potential bullish harami
BIDU -0.20 – hammer following evening star, bull flag
NDX 100 stocks stronger than the NDX include: CTXS, ESRX, LOGI, CERN, GENZ, LRCX, ADSK, CELG, BIIB, IACI, FISV, WCRX, MICC, RIMM and STLD.

Stocks weaker than the NDX: AKAM, SYMC, NVDA, PPDI, LIFE, GRMN, AMAT, MRVL, TEVA, DTV, DELL, XLNX, ORCL, ALTR and LINTA.

Stocks to Watch on Friday
Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, VECO, ATW, DOW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, BA, CHL, CLF, DLR, FFIV, GR, LVS, SPG, UNP, URE, CMG, CSTR, FAS, STI, WFMI, DECK, HAS, NYX, LXK, UNG
Moving Above 30 DMA = 4
DHR, SKX, UCO, USO
Moving Below 30 DMA = 4
AMD, MA, NETL, USD
Staying Below 30 DMA
ATI, BYI, PNC, V, A, JEC, NTRI, FAZ, NFLX, ESI, HSY, BAC, MHS, ZION, HAS, WHR, SNDK, SWN, ICE

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