Thu 8/2/12. Daily Updates.

Date-Time	Thu 8/2/12 4:30PM EST
Active SPX Trade	None.
System Score (S2)	4 = Trend Score + Turn Score = 7 - 3 = bearish
Trade Trigger (T2)	Go long a break above 1373.88. Otherwise, go short on a break below 1354.65.
Commentary	T2 says it all. Technicals and 4-candle s/r should line up bullish at 1373.89 or bearish at 1354.64. SPX is currently in the middle, so the reaction to the Friday jobs number could be the deciding factor. Short-term, TRIN>2 projects a sizable bounce but it can be delayed 1-2 days and the late-day bounce relieved some oversold indications. The current potential short setup is not very ideal but we are on the verge of a downtrend to retest 1267, so I think it's worth the risk if it happens. And, I can't say I'm that much more comfortable with the long setup given the fundamentals and choppy rise from 1267, but any rally above 1373.88 could very well reach 1400-1420. Good luck.

____________________

Date-Time	Thu 8/2/12 1:15PM EST
Active SPX Trade	None.
System Score (S2)	1 = Trend Score + Turn Score = 4 - 3 = bearish
Trade Trigger (T2)	Go long a break above 1375. Otherwise, go short on the next 4-candle support break below 1360ish.
Commentary	The Turn Score will almost certainly rise to 0 or -1 on Fri/Mon as overbought indicators have worn off, so the next trade will largely depend on what happens to the Trend Score. If SPX rises above 1365, the Trend Score will once again be strongly bullish with 4-hour candle resistance currently at 1375 for a long trade. If SPX stays below 1360, the Trend Score will be neutral to bearish and it will grow more bearish at 1350 and 1340 so the next 4-hour candle support break below 1360ish would trigger a short trade. Although I expected much less than most people from the Fed and ECB, I did expect more jawboning than the subtle language changes we got and possibly even token action. With all the negative headwinds and wait-and-see central banks and politicians, the stock market should fall apart pretty quickly (10%+ correction below 1267) once the technicals align. Good luck.

____________________
The System Score is too high to go short on the break of 1370 support. Trading below 1352 would turn S2 bearish. Until then, the System will actually trade long on a rally back above 1383. So, we're probably going to be sitting flat (no position) for another day or two. More later...