SPX Forms Spinning Top as Debt Ceiling Overhangs Stocks...

The SPX closed under 1,300 as other stocks like CME, DECK, EXPE and PCLN moved sharply higher.  Selectivity continues to rule this earnings season.

The VIX 25.25 made its highest closing high since March 17.  Gold hit a new all-time high closes at 1,629.  TNX 28.05 made its lowest close November 30, 2010.  Bonds made their highest close in 2011.

In spite of these negatives for stocks both Tom and I said in the Weekly Wrap on Friday that the non-confirmations did not suggest an unraveling of stocks at this time.  Both our opinions come from years of watching market action and we both sensed more underlying strength than seemed apparent from the readings on the VIX, Gold, TNX and bonds.

What were the positive non-confirmations?  The SPX was at mid-channel.  Financials were holding at support.  The Euro was relatively strong closer to resistance.  Leading stocks AAPL, AMZN, BIDU and GOOG were still in strong up trends and institutions were still paying up big time for good earnings numbers even on Friday on CME, DECK, EXPE, VRTX and CERN.

The SPX closed down -8.39 at 1,292.28. 

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NDX white spinning top, bull flag setup, above 30 DMA -0.38%

SPX black candle, below 30 DMA -0.65%

INDU black candle, below 30 DMA -0.79%

COMPQ white candle, close below 30 DMA -0.36%

RUT hammer, below 30 DMA -0.29%

Breadth weakened slightly as decliners led advancers 2.03 to 1 on the NYSE and strengthened as decliners led advancers 1.36 to 1 on the NASDAQ …

Exchange       NYSE        NASDAQ

Advancers         995           1,091  

Decliners        2,022           1,484

Leading stocks > +2% on Friday included DECK, UAL, WTW, LDK

Losing stocks < -2.0% included SWN, CSTR, ENTR, IAG, TBT IL, VECO, SINA, WDC, UCO, SLW, CF, POT, FCX

72 of the NDX 100 companies have reported earnings and with 28 left to report, twelve more will report this week:  ATVI, CMCSA, CTRP, CTSH, DTV, EXPD, FSLR, GRMN, HSIC, PCLN, SIRI and WCRX.

Earnings Next Week

Monday Aug 1= CTRP, HLF, HUM, SOHU

Tuesday Aug 2 = CTSH, EXPD, HSIC, SIRI, COH, FWLT

Wednesday Aug 3 = ATVI, CMCSA, AGU, ATW, ENTR, ICE, WLT

Thursday Aug 4 = DTV, FSLR, GRMN, PCLN, ANR, CF, SINA

Friday Aug 5 = WCRX, WTW

NDX Setups for Monday:  AAPL, AMZN, BIDU, WYNN

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NDX Setups for Monday:  BRCM, SNDK, APOL, FLEX

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More NDX Setups:  ALXN, BBBY, CERN, CHKP, EBAY, ESRX, EXPE, GILD, GMCR, GOOG, ISRG, VRTX

Other Setups for Monday:  ZAGG, SINA, ANF, ESI, MOS, MCP, GS, SWKS, TPS, CMG, LVS, NTES, SLB, NKE, CREE, WTW, FOSL, LULU, PRGO, UA, CGA, EZPW, HANS, ULTA, NTRI


SPX

Resistance: 1,300, 1,310, 1,321

Support: 1,288, 1,278, 1,267

The short term 3 day trend is down.

The six-month trend is neutral.

The twelve-month trend is up.

Trade with the trend of the chart you are trading.

Bullish entry signal is a bounce off support and a break above the high of the low day or a break out of horizontal resistance.

Bearish entry signal is a break of short term support or a bounce down from the 30 DMA or other resistance.

AAPL -1.34 – white spinning top, bull flag setup, above 30 DMA

AMZN -1.38 – white spinning top, bull flag setup, above 30 DMA

BIDU -1.27 – white spinning top, bull flag setup, above 30 DMA

GOOG -7.25 – inverted hammer, bull flag setup, above 30 DMA

NFLX -0.63 – white candle, below 30 DMA

PCLN +15.36 – large white candle, bounce entry, above 30 DMA

QCOM -0.21 – white spinning top, below 30 DMA

NDX 100 stocks stronger than the NDX include EXPE, VRTX, CERN, VOD, ILMN, PCLN, ISRG, AMGN, LINTA and MXIM.

Stocks weaker than the NDX include KLAC, LRCX, BMC, YHOO, SRCL, STX, VRSN, SYMC, DELL and GILD.

Stocks to Watch on Monday

Holding Above 30 DMA

CROX, CMG, ATW, POT, CAM, COH, DECK, FCX, LVS, NKE, NTES, SLB, SWN, V, SINA, SOHU, ANF, CDE, SLW, CF, IAG, MOS, DLR, WLT, CHL, MCP, MHS, GS, SWKS, FAZ, TPX, GMCR, SNDK, TLT

Moving Above 30 DMA = 3

CREE, ESI, WTW

Moving Below 30 DMA = 6

ACN, AGU, DOW, UCO, UNP, VMW

Staying Below 30 DMA

CLF, HLF, NGLS, ANR, ATI, CAT, CIEN, CRM, CRUS, CY, DLR, FAS, ICE, JNPR, LDK, NDAQ, SMH, STI, TIF, URE, WDC, AKS, CSTR, DE, PCX, TBT, X, ZION, KKD, NETL, DHR, FFIV, SWK, UNG, ARUN, RVBD, HUM, ENTR, INFA, A, F, GES, HAS, BAC, TSL, UAL, VECO, NVDA, FWLT, JDSU, GLW, IL

Intermediate Term Market Trend: Neutral

Short Term Market Trend: Down