Thursdays Gameplan

Longs: DD (49.25), C (31.50), FCX (42.00), HAL (35.00), X (27.50)

Breakouts: DNDN<14.00, COF<49.00, AMGN (R=68.00 S=67.50), ESRX>52.50, MOS<54.50, XOM<83.25,WLP<64.00, AXP<51.50 Shorts: NTAP (40.00), VLO (25.00), LOW>27.50, UNH (55.00), AKAM<37.50 (Gapfill)

Notes:

Extremely stock specific environment the day before yesterday due to the absence of volume made yesterday a very difficult day to trade, quant studies showed the likelihood of a down day and we got it. It was difficult to not lose money yesterday as almost all my stocks weren't in play. The QQQ climaxed out yesterday on ultra high volume which was mainly influenced by the climax in AAPL which had went parabolic, this should signal intermediate selling,however, the long term trend remains intact. The SPY and DIA were also weak, however, not as weak as the QQQ and its associated tech sector. As of yet, I can't see any sector in play in this stock specific environment but given yesterday prices action I expect some sectors to be stronger/weaker than the rest as more sectors come into play into this correction/pullback in the return of volume.

The key level to the downside in the SPY is 134.25 - 134.00, if breached it should prompt further selling that could be met by buying or further selling. 135.50 is the other key level to the upside that if tested would prompt a reaction. The key level for the QQQ is 62.70, while for the IWM its 81.00.

The VIX is at 21 as volatility creeps in, with the DX also taking out its pivotal 79.50 level further adding fuel to the fire. TLT on the other hand declined yesterday with the market as selling engulfed everything including treasuries. We also have a ton of economic indicators coming out today, we have the Building Permits, PPI and the Unemployment Claims indicator coming out prior to the market open along with the Bernanke who’s going to speak half an hour prior to the open. We then have the Phily Fed Manufacturing Index coming out half an hour after the open, these elements are further evidence that today is going to be volatile.

Quant studies indicate to a down day, the EUR/USD is at its 50 DMA and is about to break it with gold and silver both down. Hang Seng is down along wih Shanghai, both being down about .4 percent. Futures are all pointing to a lower open, this open could be met by buying and trigger my saturation play or we could see volume hit the market and send it lower, watching volume and how vicious the bears is crucial to identifying whos in control. That being said, I will be very careful with any potential longs, trailing them on lower timeframes or booking them on momentum. We are still in a bull market and one down day doesn't change anything.