Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Monday, July 11, 2011

|Includes: SPDR Dow Jones Industrial Average ETF (DIA), GLD, QQQ, SLV, SPY, TLT, USO, UUP, ZAGG

We are lowering the support/resistance levels on the DJIA (NYSEARCA:DIA) (12,480/12,570), S&P 500 (NYSEARCA:SPY) (1,316/1,331), and Nasdaq Composite (NASDAQ:QQQ) (2,800/2,815)...The S&P 500 slightly went below its 50-day moving average of 1,316.44 to 1,316.42 and closed above it at 1,319.49...The DJIA and Nasdaq Composite are 130 and 40 points above their respective 50 day moving averages...The selloff was not unexpected with the Volatility Index (VIX) coming into to today's session (and as we mentioned last week) indicating the market has been in a low volatility/high complacency status...All sectors finished lower with financials (NYSEARCA:XLF) declining the most at 2.7% on slightly higher volume...The stock focus list lagged the overall market in terms of price action down 2.2% on slightly below average volume with the S&P 500 down 1.8% with sellers controlling the action...Focus list stock Zagg Inc. (NASDAQ:ZAGG) held in there relatively well holding its support level at $12.55 with resistance at around $12.85...Remember our focus list are not recommendations but are a list of stocks with strong fundamentals to watch in helping determine how the stock market direction is performing...Bonds (TLT) were 1.5% higher but with the stock market selling off the action in TLT did not suggest investors were moving their money to Bonds because volume came in at average levels...The US Dollar (UUP) gapped up at the open and finished higher by 1.4% on below average volume-gap up between $21.48 and $21.62...Silver (NYSEARCA:SLV) declined more than the overall market down 2.4% on very low volume and seems to be finding resistance at its 50 day moving average but for remains above its 21 and 200 day moving averages...Gold (NYSEARCA:GLD) finished higher by 0.9% on moderately higher volume and put more distance above its moving averages...Oil (NYSEARCA:USO) declined 1.4% on volume materially below average and closed slightly below its 21 day moving average-USO is now below all its moving averages (21, 50, 200)...The Volatility Index (VIX) is now up 18.2% and above all its moving averages (21, 50, 200)-last week we mentioned that the market was in a period of low volatility and high complacency-today the market is working off some of this as volatility has increased and investor fear has picked up...VXX the Volatility Index ETF is up 8.1% on heavy volume today...Bonds (symbol: TLT) is up over 1% for the second straight session however volume is significantly below average...The stocks in the focus list are down an average of 1.8% on 25% higher volume-lagging the S&P 500 which is down 1.5%...The US Dollar (symbol: UUP) is up 1.3% but volume is moderately below average and UUP gapped up at the open and now has an open gap between $21.48 and $21.62-gaps usually get filled in the near future...The S&P 500 might be headed for a test of its 50 day moving average in the 1,317 area...Investor fear and volatility looks to be back with the Volatility Index (VIX) up 12% this morning and back above its 50 day moving average.


No positions in securities mentioned.