Market Update - 2/12/2010

Another volatile day again today. This entire week has been very choppy. It seems as if wave (ii) is topping in a complex way.

Yesterday I said 1060 was the number to break on the SPX. We made it to 1062 then bounced sharply. So far, 1060 is doing a good job as support. However, 1080 held as resistance. So for now, the SPX seems to be in this 20 point range. Until this range breaks, it's hard to determine the direction.

Here is a chart on SPY.

As you can see, the topping pattern we are in now may be similar to the one a few weeks ago before the initial move down.

There is also a potential head and shoulder on the Dow.

The target is around 9800. We have seen these patterns fail in the past, but if we break below the range, this may play out.

I will have more charts over the weekend. Also, this is a long weekend since there is no trading on Monday due to Presidents Day. So please check back later in the weekend for more charts.