Show me the money

My forecast for a higher close today was looking pretty good until a wave of selling kicked in at exactly 3:25 PM (still not sure what event triggered that) and turned a 30 point gain into a 25 point loss.  The Dow now has some minor support at 12,340, then some stronger support around 12,250, then nothing down to the psychological support at 12,000 even.

And that's worth looking at now because despite some pretty oversold indicators, this market is looking nothing but weak.  And even worse, all of the futures are lower right now at 12:45 AM EDT with the ES being down 0.6%, and that's pretty substantial.  That said, the ES indicators are even more oversold than the Dow.  In fact they're about as oversold as during the Japan reactor panic back in March.

I also note that at least my call on the VIX was correct.  It did indeed retreat today from yesterday's pop above its upper Bollinger band.  Given the propensity of the VIX to predict the market a day ahead, you'd think that we should be looking for some gains (finally) tomorrow.

Still, this big drop in the futures seems to be hinting that someone knows something I don't.  This has me feeling rather uneasy this evening.  Although technically it looks like a turn should be imminent, I can't really be as optimistic about the market right now as I was last night.  I mean, the market has to turn sooner or later, and having come down so far I think it will be sooner rather than later but at this point, it is going to have to show me that the bottom is in before I can reach for my long hat again.

Trades

That said, today I picked up some of the gold miner AUY at 12.33; it closed at 12.35.  AUY has been beaten down from its April highs and appears to have put in a bottom last week.  Its indicators are all still low and its short stochastic has executed a bullish crossover.  And it popped out of its descending RTC channel going back to April 11th, which is bullish.  The fact that it's been holding its own during the recent market decline is also attractive.  So we'll give this a shot and see what happens.