Sure Plays A Mean PinBall! $SPY $QQQ $IWM $DIA

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So, how did you do on the Stocks Aptitude Test? Did the 5 W’s and H I wrote about last night increase you comprehension and critical analysis enough to help you sort your way through Tuesday’s session? The title of that passage could have been- The Fear of Default. Shorting NASDAQ after 2 inside days and covering at the 50 DMA was textbook! Anyway, here’s what we have now: if you think of yourself as a pinball machine rather than the pinball itself subject to bouncing around and hitting walls, then what we have is a potential blow out selloff with a test of the 50 DMA in the 2 that were leading NASDAQ and Russell 2000. Double the average daily volume, big price drop, run for the exits-all can create that scenario. Doesn’t mean we cannot go much lower or that tomorrow won’t open lower (liquidation from the highs will do that too). But, thinking like a machine and not a silver ball, if either of those two indices cross back over the 50 DMA and better yet, close above? Like the “deaf, dumb and blind kid”-sorry quoting not trying to be non-PC-who “ain’t got no distractions”, perhaps “play by intuition” and trade like the worst is over!

S&P 500 (SPY) Double the average volume here on a big down day could be the start of something even uglier, or the blow off as mentioned above. Either way, time to think risk/reward on longs and shorts and which make most sense

Russell 2000 (IWM) Unconfirmed weak warning phase. 104.30 the 50 DMA to watch

Dow (DIA) If there is something to learn from these dailies, it’s the law of attraction to moving averages-this one to the 200 DMA now super close.

Nasdaq (QQQ) 77.30 is the 50 DMA as this went into an unconfirmed warning phase.

ETFs:

XLF (Financials) 19.73 resistance 19.35 next support

SMH (Semiconductors) 39.23 good support area then it’s down to the 50 DMA

XRT (Retail) Another example of the attraction to the 50 DMA fulfilled. Getting oversold

IYT (Transportation) Broke the 50 DMA, filled gap to 115.72 and dropped lower now a bit oversold

IBB (Biotechnology) Flush job

GLD I have been so determined to short and now, has to break the range low of the last 2 trading session

USO (US Oil Fund)This could be a buy over Tuesday’s high, especially if it gaps higher

OIH (Oil Services)Holding up better than most-good place to look when market stabilizes

XOP (Oil and Gas Exploration) Has more room to correct now as a once giant!

TBT (Ultrashort Lehman 20+ Year Treasuries) FOMC minutes released Wednesday.

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