Market Tests March Lows

9:00am (EST)

The bulls were behind the 8-ball again on Wednesday as the bears pushed March lows at the open. The rebound came on word Greece would get its latest schedule debt bailout which gave the bulls energy. We won’t waste our words on geopolitical news this morning but the end result was a lower high and a lower low for the market which is bearish.

The Dow fell 97 points, or 0.8%, to close at 12,835. The blue-chips traded to a low of 12,748 (-184 points) but recovered half their losses to finish above support at 12,800.

The S&P 500 fell 9 points, or 0.7%, to settle at 1,354. The index kissed a low of 1,343 which opens the door for a test down to 1,325-1,300. The selling pressure will pick up steam on a drop under 1,340 if support at 1,350 is tested again today.

The Nasdaq gave back a 12-pack, or 0.4%, to end at 2,934. Tech once again traded down to exactly 2,900 and could see an accelerated sell-off down to 2,850-2,800 if the bears can get under this level.

The Russell 2000 slipped 4 points and closed at 788 but touched a low of 781. Meanwhile, the S&P 500 Volatility Index (VIX, 20.08, up 1.03) closed above 20 and was up 5% for the session after reaching a peak of 21.59. A move above 22.5 could cause chaos.

Cisco Systems (CSCO, $18.78, up $0.07) reported earnings after the bell last night and beat Wall Street’s estimates, but as we have seen with a number of other companies, Cisco guided lower for the coming quarter. Shares were down 9% in extended trading and were at $17.

We have added 4 charts this morning. Two are for the Dow and S&P, the other 2 charts are for our NEW TRADES we are trying to get into at the open.

As we head to press, futures look like this: Dow (+40), S&P 500 (+9), Nasdaq 100 (+11).

Subscribers, please use limit orders to get the best fills.

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