12:30pm (EST)

Monday’s have been weak of late and following an opening pop and drop, the indexes are mixed as we head into the second half of trading.  Tech has shown some strength but the blue-chips are taking a hit after another major miss by a Dow component.

Last week’s shock came from IBM (IBM, $188.34, down $1.66) and today’s not surprising miss came from Caterpillar (CAT, $81.91, up $1.48) after the company missed estimates.  Caterpillar reported earnings of $880 million, or $1.31 a share versus $1.59 billion, or $2.37 a share, in the year ago quarter.  Revenue fell to $13.2 for the just ended quarter.  The suit-and-ties were expecting CAT to earn $1.40 a share on revenue of $13.6 billion.

Shares have traded below $80 but have held up well as the CEO’s spin on a bottom in mining is providing some relief.

We mentioned this morning today would be an important session for the bulls as they try to hold support and avoid another negative Monday close.  Although there was some serious technical damage done last week, there is also the possibility of another trading range or a push to resistance and prior highs.

There are a number of trades we are adding to our Watch List as we start to open our next batch of trades into May, June and July.  We have room to add up to 10 new trades but we need to be careful and wait for further confirmation of a breakout or breakdown.  We should have some better clues by midweek as this is the heaviest week for S&P earnings.

We do have some pin action on the few open trades we started last week including a biotech play from February is heating up and on the verge of a breakout.

As we head to press, the Dow is down 26 points to 14,521 while the S&P is up 3 points to 1,558.  The Nasdaq is higher by 18 points to 3,224.  Subscribers, check the Members Area for the updates and we will be back in the morning with a full report.