SPX Forms Doji Inside Day...Short Term Reversal Pending...

The SPX formed a doji inside day as the SPX held current support to close at 1,178, up +0.25 or +0.02%, the COMPQ closed +6.17, the INDU fell -15.62 and the RUT finished +2.43 on Wednesday.

Breadth was stronger as advancers led decliners 1.51 to 1 on the NYSE and 1.1 to 1 on the NASDAQ...

Exchange     NYSE    NASDAQ
Advancers    1,812      1,383
Decliners      1,196      1,251

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

Leading stocks on Wednesday included SINA, GES, RVBD, UNG, CRUS, CAKE, NTES, ATW, DECK, CMG, SOHU, AKAM, CREE, WLT, CF, CSTR, CAM, SLB, MOS, URE, PCLN, HLF, FAZ, MCD, V, SKX, POT, GMCR, NETL, F, NTRI, CAT, TBT, HAS, SPG, ICE, WHR, CLF, NFLX, AMX, JEC, GME, SWN, MA, UAL, BYI

Losing stocks included LDK, TSL, , UCO, ATI, LVS, STI, BAC, VMW, FAS, AMD, INFA, ZION, WFMI, FFIV, FCX, CRM, DLR, SNDK, TLT, DHR, BA, PCP, NYX, PNC, CHL, HSY, RMBS, FDX

Interest rates inched higher, bonds moved lower, the Euro moved higher and the SOX closed near even -0.06%. The VIX fell -0.82 to close at 21.76.

Six of nine sectors moved higher on Wednesday with Consumer Discretionary XLY +0.87% and Energy +0.41% leading all sectors up.

All four indexes again closed below their 30 DMA and all forming an inside day. The inside day after a short term pull back setups up a potential short term reversal in the direction of the intermediate term up trend. Watch on Thursday for a break of the high of the inside day.

The market appears poised to bounce…which doesn’t mean it will bounce…rather the technical probabilities suggest a high probability that it will bounce…

Why?

The intermediate term trend is up.
The chart has pulled back to support.
The chart has formed a doji, inside day suggesting downward momentum may be done.
All four broad indexes formed an inside day on Wednesday.
AAPL held and closed above support.
QCOM has a strong bull flag bounce.
BIDU has moved back above support and formed a bullish harami inside day.
PCLN has formed an outside day white candle indicating potential short term reversal.
NFLX has closed above support forming a white spinning top inside day.
GOOG has formed a spinning top second candle of a potential morning star pattern.
AMZN has formed an inverted hammer inside day.

Follow your rules is entering a break above the high of the inside day.

Charts to Watch
Bull Flag Entries on Wednesday – SINA, GES, RVBD, CAKE, NTES, ATW, DECK, CSTR, WLT, CAM, MOS

The stocks are still intermediate term up trends and should be viewed as potential Flag Setups even though they are in extended five to seven day pull backs - DOW, JOYG, HUM, X, WYNN, FAS, USD, BYI, GR, IPI, UAL, UNP, AMD,SOHU, VECO, MAR, ARUN, AIV, CLF, ILMN, PCLN, RMBS, SNDK, SPG, LVS, DE, ZION, AAPL, NFLX, CTXS. FCX, SLB, PNC

SPX
Resistance: 1,182, 1,190, 1,200
Support: 1,170, 1,148, 1,130

The short term 3 day trend is down.
The two-month trend is up.
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 -1.09 – black spinning top closing above support
QCOM +1.60– white candle bull flag bounce
GOOG -0.17 – spinning top below support
BIDU +3.32 – bullish harami above support

NDX 100 stocks stronger than the NDX include QCOM, QGEN, BIDU, ROST, MAT, EXPE, ADSK, SHLD, VMED, COST, CTXS, LINTA, URBN, CTSH and ILMN.

Stocks weaker than the NDX: NTAP, FSLR, WYNN, VRTX, FLIR, MRVL, BRCM, MSFT, VOD, CTAS, SNDK, RIMM, AMAT, YHOO and ADBE.

Stocks to Watch on Thursday
Holding Above 30 DMA
HLF, PCLN, LVS, CMG, SINA, AIV, CAKE, CAM, DHR, UNP, WLT, A, ATW, SLB, NDAQ, USD, AMD, DECK, GR, GS, VECO, CSTR, RVBD, TBT, WFMI, NFLX, PNC, BYI, INFA, MHS, NETL, CRM, FFIV, ARUN, SWN, CAT, POT, GME, NTRI, X, CREE, BUCY, FAZ
Moving Above 30 DMA = 7
ESI, GES, HAS, JEC, MCD, NTES, UNG
Moving Below 30 DMA = 6
AIV, AMD, ARUN, CRM, DHR, INFA
Staying Below 30 DMA
AMX, ATI, CLF, DE, DOW, FAS, FCX, IPI, LDK, MA, RMBS, SNDK, SPG, UAL, UCO, VMW, ZION, AKAM, CF, GMCR, HANS, MOS, AGU, BAC, ICE, URE, V, ACN, CHL, FDX, NYX, PCP, STI, SWK, TSL, AKS, BA, HSY, POT, ESI, SKX, WHR, LXK, TIE, FAZ, CRUS, TLT, DLR

Intermediate Term Market Trend: Up – 2 months
Short Term Market Trend: Down