SPX Holds...Forms Spinning Top...Potential Evening Star...

DJIA              10,537.69  +12.26 +0.12%
SP500              1,113.84    -1.17  -0.10%
COMPQ          2,288.25      -8.18 -0.36%
Russell 2000       662.17     -3.05 -0.46%

Exchange      NYSE   NASD
Advancing     1,338    1,125
Declining       1,697    1,504

Oil            $77.50   -1.48
Gold     $1,158.00 -25.10
SOX          366.08   -3.42
VIX             23.19  +0.46

Index    Direction  Confirmation
VIX          Up           Yes – SPX
SOX        Down       Yes – COMPQ

Leading stocks on Tuesday included LXK, SNDK, AMD, NYX, WFMI, UNG, NFLX, MHS, VMW, FAS, V, MA, ZION, DOW, BAC, SPG, ATW

VECO and AKS gave back early gains after better than expected earnings.

X moved lower after missing expectations.
RMBS closed higher but down from its high of the day.
BRCM reported GAAP earnings of 52 cents not comparable to estimates…price target raised…watch stock on Wednesday


The SPX rested today forming a spinning top, after a three white soldiers candle pattern...this has the potential to turn into an evening star pattern.  We are now on Yellow Alert for pull back.

In Japan...this is Wednesday morning...yes I know it is still Tuesday evening for most of you...I arose once again around 4:30 am and went for about a six mile walk...something I have been doing for the past five days. 

On the path that I walk which runs through a portion of the city I am staying in, I have seen two black crows for the past four days...this morning I saw three black crows.  Each day they are in the trees just five to ten feet away and as I walk by they fly to other trees several feet away.  I have thought of candle patterns each morning as I have watched them and today.  As many of you know three black crows is a bearish candle pattern.

Guidance...
SPX forms spinning top potential evening star at its 1,115 resistance level...

The SPX makes higher high and higher low and closed just below its 200 DMA.
The VIX did confirm the slightly lower close in the SPX.
Breadth was weaker as decliners led advancers 1.2 to 1 on the NYSE.
SPX price target 1,1141.

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.

Trend is still up, but be on Yellow Alert for potential exit from short term bullish trades and potential entry into short term bearish trades if a break of the low of the high day occurs.

The VIX rose 0.46 and closed at 23.19. Volatility closed below the important 25 level on Tuesday.

The short term 3 day trend is up.
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 +4.80
QCOM -0.02
GOOG +3.66
BIDU +0.70
NDX 100 stocks stronger than the NDX include: HOLX, CEPH, COST, AAPL, AMGN, LOGI, MXIM, BIDU, ERTS, SHLD, GOOG, CA, PAYX, INTU and AMAT.

Stocks weaker than the NDX: URBN, STLD, RIMM, BBBY, ILMN, PPDI, PCLN, ROST, NIHD, PCAR, LIFE, AKAM, JOYG, MRVL and LINTA.

Stocks to Watch on Wednesday

Holding Above 30 DMA
TLT, CRUS, GMCR, HANS, TSL, BUCY, CAT, CREE, CRM, HLF, NETL, PCLN, TIE, VMW, AGU, MCD, DE, GS, IPI, AKS, MOS, POT, CAM, USD, VECO, ATW, DOW, FCX, FLS, GES, GME, PCP, UAUA, WLT, WMT, X, SWK, ACN, AIV, AMX, ATI, BA, CHL, CLF, DLR, FFIV, GR, LVS, SPG, UCO, UNP, URE, USO, CMG, CSTR, FAS, MA, PNC, STI, V, WFMI,AMD, BYI, DECK, HAS, NYX
Moving Above 30 DMA = 1
LXK
Moving Below 30 DMA = 3
A, DHR, JEC
Staying Below 30 DMA
NTRI, FAZ, NFLX, ESI, HSY, BAC, MHS, ZION, HAS, WHR, SNDK, UNG, SKX, SWN, ICE

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