Perhaps a pause

Yesterday I was fairly sure we were going higher today, but I didn't really think we'd see the monster 178 point pop we got in the Dow. But I'll still take it :-) So there's a bunch of interesting stuff going on in today's daily Dow chart.  Check it out.

First of all, we reclaimed the 12,000 mark and crossed back up over the 40 day MA (at 11,989). Even more importantly, I think, is that we crossed up above the daily pivot at 11,854 and held. All of these points are bullish. In fact, today's intraday chart looked like a mirror image of the awful action last week. 90% of the entire day's action was over in the first two minutes of trading, only this time it was to the upside.

Notice also how the RTC works. Look at the steep descending RTC. Yesterday we broke out the right edge of that. That was the bullish setup. Todays gain was the confirming bullish trigger.However, look at the volume - much lower than yesterday.

Next, take a look at the Fibonacci retracement levels I've drawn in going from the high on February 18th to the low last week. I've never been a huge fan of Fibonacci because I don't really understand why it should work, but it sure seems to. Notice how today's high, 12,078, almost exactly hit the 0.618 Fibonacci retracement level. That's going to be an important number to watch tomorrow.

Then there's our friend the VIX. It gapped down in a big way today, down nearly 16% to close at 20.61. In so doing, it fell right through both its 200 day MA and its daily pivot. It is now back in the middle of its Bollinger band range, and the area where it has spent much of the last month. It definitely still has room to go lower.

Moving on to the futures, all three of ES, NQ, and YM are down at the moment (1:20 AM EDT) by about a quarter of a percent.

And finally there's the news, or rather the lack thereof. On this evening's news wire, I note that neither Libya nor Japan appear in the top stories on the wire at this hour.

So let's wrap it up. On the plus side, we have positive chart action that broke through important resistance levels, a bullish trigger from the RTC, positive VIX action (positive for stocks, that is), and positive "no news is good news" action on the international front.

On the minus side we have slightly negative action from the futures and declining volume. My net take on this is that after such a large three day run, and the big move up today, the market may take a breather tomorrow. It now has support at 12,000 and resistance at 12,049. So I'm looking for a small range day tomorrow, with resumed upside later on this week.

Trades

Last Thursday and Friday, I took advantage of the sale the market threw to pick up a little more OMEX, ARR, and CIM. Those all proved to be good moves. In a stupid move, I bought some Citibank (C) at 4.53. It closed today at 4.43 after news of the upcoming reverse split.

I don't normally mention my IRA here, but I also bought some O (Realty Income Corp) at 31.72 as a longer term investment there.