CONSOLIDATION

There was a bit of consolidation that took place today as the market moved back and forth. It tried to sell off in the morning, but the buyers came in again and held the 1000 level in the S&P 500. The longer we hold this level, the more likely it will be that we will breakout again (above 1007). Watch the 995 area on the downside. I think this is a key short term support area. If we break this support...especially in a sharp drop...we might begin a larger correction. It's hard to find new catalysts or reasons for the market to continue to go higher. CSCO's earnings were okay, but the stock sold off in after hours trading. Keep an eye on the Nasdaq. The Tech stocks started this move and they might signal the end of the move. The Nasdaq was down a larger percentage today than the S&P 500 and DOW. Again...this is not a bad area to take some profits and build some cash. If we do breakout, you can buy the breakout. If we sell off hard, we can look to profit on a small put position to the downside. If we move sideways....well..we will start all this again tomorrow. Here are some stocks from The Market Trend Signal's (www.markettrendsignal.com) new MuscleStocks scan: RDN (wait for a bit of a pullback after today's move), DRN, NTES, HA, CAR, and VNDA.