Market Pulls Back, Bears Test Support (Again)

1:30pm (EST)

We knew when we started our research this morning it was going to be a rough day for the market. Futures were weak when the overseas markets started trading and were down about 0.5% on continued European debt concerns.

The latest theme for the market has been a higher dollar and a lower euro equals a down market and that is what we are seeing today. Wall Street is also a little worried about growth prospects in China, which could be slowing after a manufacturing report showed local manufacturers were seeing a pullback.

The Dow is down 151 points and is at 12,362 while the S&P is lower by 17 points to 1,316. The Nasdaq is showing a decline of 45 points and is at 2,758.

All three indexes are right on the downside targets we went over this morning but are holding which is the good news if you are bullish. Dow 12,350; S&P 1,300-1,325; and Nasdaq 2,750 are the key levels we are looking to hold.

The S&P 500 Volatility Index (^VIX, $18.53, up $1.10) is up 6% but surged to 20 at the open. We also mentioned to watch the 20 level on the VIX and although it has pulled back, everything is playing out like we have expected.

It still remains to be seen if we bounce from these levels or if this really is the start of a trend change. Either way, we have been able to lock in profits for a couple of our trades. Our other recommendations are still in good shape so let’s go check the tape.

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Market Pulls Back, Bears Test Support (Again)

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