SPX New High Close Above Horizontal Resistance While the RUT Pauses...

The SPX was down four points early and rallied to close 4.53 points higher at 1,228, just above November's horizontal resistance and a 2010 new high close...the RUT closed slightly lower down -0.38 or -0.05%...The COMPQ moved up +10.67, the INDU rose +13.32.

(click image to enlarge)

Breadth weakened on Wednesday as decliners led advancers 1.57 to 1 on the NYSE and 1.00 to 1 on the NASDAQ…

Exchange       NYSE          NASDAQ

Advancers      1,171              1,328

Decliners        1,850              1,333

(click image to enlarge)

Index Direction      Confirmation

VIX       Down            Yes – SPX

SOX     Up                 Yes – COMPQ

Leading stocks on Wednesday included ESI, ZION, FAS, PNC, UNG, BAC, CRM, STI, VMW, SINA, GS, ARUN, USD, TBT, AMD, ICE, MA, V, NYX, CRUS, INFA, CREE, BYI, F, UCO, PCLN

Losing stocks included FAZ, TIE, HANS, LVS, URE, AIV, POT, CMG, TSL, IPI, WLT, MCD, AGU, CLF, SWN, FCX, DECK, UNP, X, ATI, NTES, SPG, VECO, BA, ATW, SOHU, DLR, UAL, WHR, LDK, GMCR, CF, DE, CHL, TLT, SKX, NFLX, CAT, MOS, FLS, RMBSAKS, GES 

Interest rates rose, bonds moved lower but rallied from their daily lows, the Euro fell and the SOX rose +0.95% closing at 415.43 on Wednesday.  The SOX is a leading group at this time.  The VIX moved down -0.25 to close at 17.74, its lowest close since April 26.

Four of nine sectors moved higher on Wednesday with Financials XLF +1.61% and Technology XLK +0.85% leading all sectors. The SPX closed above its horizontal resistance on the strength of Financials XLF.

Trend is up?  You tell me.

The RUT, SOX and TRAN along with XLE, XLB, XLI and XLY have been above horizontal resistance since last week.  On Wednesday the SPX and COMPQ closed just above their November horizontal resistance.  The SPX, COMPQ and SOX made a new high close today.  The RUT made and new high close on Tuesday and the TRAN made a new high close on Friday.

Looking for strong stocks?  Look at the current leaders already above horizontal resistance, and those gaining strength which moved above their 30 DMA this week and look at the RUT, SOX and TRAN.  Leading stocks today and NDX leaders can also be good candidates.

XLE, XLB, XLI and XLY and pulled back in the first day of a bull flag above their horizontal resistance.

Horizontal Resistance Breakout – CRM, UNG, CRUS, NUE, VMW, A, DHR, PNC, NYX

Charts to Watch Setups

Bull Flag Setups – CMG, FDX, HANS, ICE, RMBS, SKX, X, VECO, CF, AIV, AKS, UCO, F, PCLN, RVBD, NFLX

Horizontal Breakout – ATW, CSTR, GR, AMD, AKAM, TBT, SWK, WHR, SOHU, ESI, ZION, GS

Potential MACD Divergence - HSY

Bear Flag Setups – GOOG, NTRI

Continue to trade with the up trend and look for a potential break of horizontal resistance next week.

SPX

Resistance: 1,220, 1,241, 1,256

Support: 1,209, 1,200, 1,190

Enter bullish trades with a bounce off support and a break above the high of the low day or a break out of horizontal resistance.  Thursday was an entry signal for many stocks.

Wait to enter bearish trades for break of short term support or a bounce down from the 30 DMA.

The short term 3 day trend is up.
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 +2.80 – potential hanging man at resistance new high close

AMZN -0.48 – spinning top

QCOM +0.41 – spinning top near resistance in consolidation

GOOG +3.40 – potential hanging man in potential bear flag

BIDU -1.61 – black candle

NDX 100 stocks stronger than the NDX include FWLT, APOL, NTAP, DISH, BRCM, ALTR, INTU, FSLR, MCHP, QGEN, BMC, DTV, ERTS, ADSK and MXIM.

Stocks weaker than the NDX: CEPH, VRTX, HSIC, BIDU, HOLX, GRMN, RIMM, PDCO, SPLS, LIFE, NIHD, CTXS, ROST, JBHT and SBUX.

Stocks to Watch on Thursday
Holding Above 30 DMA
HLF, PCLN,  CMG, SINA, CAKE, CAM, UNP, WLT, ATW, SLB, NDAQ, USD, DECK, GR, VECO, CSTR, RVBD, WFMI, NFLX, BYI, MHS, NETL, FFIV, CAT, X, CREE, GES, HAS, MCD, UNG, CLF, CRM, INFA, VMW, RMBS, SNDK, CRUS, GMCR, AIV, AKAM,  ATI, PCP, SKX, FCX, FDX, AKS, A, AMD, DHR, DOW, FLS, GME, ICE, MA, PNC, SPG, TBT, UCO, DE, FAS, JEC, STI, SWK, WHR, ZION, SOHU, ACN
Moving Above 30 DMA = 6

ARUN, BAC, ESI, GS, NYX, V
Moving Below 30 DMA = 5

CF. HANS, IPI, SWN, URE

Staying Below 30 DMA
AGU, AMX, LVS, POT, TIE, NTRI, UAL, FAZ, TLT, MOS, NTES, LDK, CHL, TSL, BA, HSY, LXK, DLR

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