Today, if you were prepared with a plan to focus on a couple of stocks and ETF's that were oversold and had short-term trading patterns, the oversold condition that we talked about yesterday gave you, at the very least, good daytrading opportunities and in some cases possibly another day of momentum to the upside. Today's video for my subscribers pointed out how to use key pivots and the opening range breakout with very low risk in SPY, how to use the opening range breakout in conjunction with previous day high in XLE and how to buy the opening range reversal against key pivots in GLD. We also came in long VHC which gave us an opportunity to take some profit at half an ATR and short IYR which also gave us an opportunity to take some profit at a half an ATR.

Now, SPY worked off its oversold condition closing up .8% on lighter than average volume. At this point, the 50 day moving average continues its downward slope. Unless we see the slope on the 50 neutralize and or an Accumulation day of volume, we will continue to see today's rally as short-lived and an opportunity to go short, especially in those instruments that have been trading beneath key moving averages. But, for now, 131 still seems like a reasonable target.

QQQ matched yesterdays range almost to the tick. That makes NASDAQ a bit more readable for tomorrow since it had an inside day. We will look at either a break above 55.77 to see if we can get more upside or if we break 55.23, another leg down to the 200 day moving average.

IWM also had an inside day. And, with all of the moving averages sloping down, the last vestige of support is the upward sloping 200 day moving averages. It does appear to be a matter of time before the indexes drop to test the 200.

Therefore, we are still in an accelerating warning phase, need a lot more work with volume and price to return to a bullish phase, and quite possibly could see further erosion if the indexes break the 200 day moving average and begin to enter a distribution phase.

ETF's: the dollar has gained some strength since FXE was overbought. Now, there is a possibility that the gap from June 7 left a temporary Island top. Today FXE stopped right above the 10 day moving average. But it gapped open lower from yesterday. Initially, I was calling for a correction to the 50 day moving average. However, if we have indeed put in an Island top from the rally that began on May 23, it would not be surprising to see a decline to the exponential moving average.

TBT bounced from last week's low. The weekly chart shows it's oversold. There was a death cross in the TBT's on May 31, but with such oversold conditions and tremendous weekly support down by 30, it looks like a weekly close above 35.20 and we could indeed see higher interest rates which would correspond with lower prices in the indexes.

IBB closed for the first time since March beneath the 50 day moving average. Although the slope on the 50 day moving average is still pointing up, even if we get a confirmed warning phase, we will have to consider that a weak warning phase for the time being. I wrote last night that IBB was starting to look toppy. But, would not be looking to go short at this time given the conflicting signals until we see the 50 day moving average begin to neutralize or slope down. Until then, this looks more like a correction.

SMH** had a DOJI day and closed just above the exponential moving average. Everything lines up tomorrow: today's closing and opening price and the exponential moving average. Follow the range.

The financials were the first to breakdown, along with energy and oil. Real estate is now beginning to break down, biotechnology still in a correction phase along with retail; and semiconductor's fate hangs in the balance. I am watching very carefully not only the direction of the dollar and interest rates, but also how the leading sectors and groups continue to fare.

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