Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors. Tuesday, May 10, 2011 End-of-Day Update

|Includes:CCJ, CSCO, SPDR Dow Jones Industrial Average ETF (DIA), EUO, PSQ, RWM, SH, SPY, TIP, UUP, VXX

Stocks rose today with each of the major indexes gaining at least 0.5%. The DJIA (NYSEARCA:DIA), S&P 500 (NYSEARCA:SPY), and Nasdaq Composite (QQQQ) all closed near their session highs. In addition, both the S&P 500 and Nasdaq Composite spent the entire session in positive territory while the DJIA was only slightly negative at one point during today's trading session. Market breadth was very positive and investor participation picked up but remains below levels compared to last week when the stock market was experiencing selling pressure. Even with today's strong action and based on the current stock market direction we are keeping the support/resistance levels the same for the DJIA, S&P 500, and Nasdaq Composite (see below). The DJIA, S&P 500, and Nasdaq Composite with the action today put more distance above their current levels compared with their 21-day moving averages they have recently been testing. In addition, the DJIA, S&P 500, and Nasdaq Composite are marching closer to the new highs (on a closing basis) they set during the first trading session of this month. The Nasdaq Composite actually intra-day today re-tested the May high of 2,874 but closed at 2,872. The Semiconductor Index (the SOX) lagged the overall market as it gained 0.5%. The underperformance of the SOX is something to keep an eye on since history has indicated with decent success that the SOX can be a leading indicator for where the stock market is headed. The Volatility Index (the VIX) has retreated back down to the same levels during the beginning of May with the recent pickup over the last three trading sessions. Low volatility and high complacency remains a part of the current market. In our opinion under the hood the stock market remains vulnerable for a swift pullback. The risk/reward profile coupled with the action in many individual stocks continues to indicate that the market is due for a more severe correction. Having said that if you need to own stocks then it might be best to nimble into stocks slowly and keep protecting your profits/limiting your losses.

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