Good morning! For the third day in a row, the market was again higher risk as the indices moved with a great deal of overlap and lacked solid intraday setups. The day began with a strong divergence between the NASDAQ Composite on one side and the SP500 and Dow Jones Ind. Average on the other. The NASDAQ had the most relative weakness and held the prior afternoon's closing range from the first hour of the day while the SP500 and Dow moved a bit higher, forming a 2T reversal pattern at the upper trend channel resistance and 5 minute 200 sma intraday.

The market broke down throughout the remainder of the morning. It was a slow move without strong continuation patterns and a lot of choppiness as it fell. As long as you only followed at the 15 minute charts it was a pretty nice move. The NASDAQ put in an equal move compared to the prior drop and the Dow held the zone from the prior day's close, leading to a pivot into the early afternoon off this strong intraday support that was coming together. The 200 day sma in the NASDAQ also helped since that hit at the same time as well.

The upside out of the support was pretty strong, pulling quickly into the morning breakdown zone in the Dow and 5 minute 20 sma in the weaker NASDAQ. The NASDAQ formed a 5 minute Phoenix pattern by basing along the moving average into the 13:00 ET reversal period as volume declined. The pattern triggered as that range broke higher and it took the index into its 15 minute 20 sma target very quickly.

The market began to correct nicely along the resistance, but then went a bit nutty when the FOMC minutes came out at 2:00 ET. Big surprise: the Fed. plans on continuing to raise rates. Despite the unexpected, the market reacted pretty strongly. It was almost like a mini-FOMC meeting announcement. The indices sold off, put in a larger counter-move, and then continued back in the original direction to pull the market back to morning lows. That support hit at the last reversal period of the day with half an hour left on the session and it held into the close.

We now have three days of this choppy action intraday. Typically, like in a trend move, this last about 2.5-3 days. I'll continue with my plan for Tuesday to loosen up risk on intraday setups. This week so far has been very slow for me with only a few setups intraday with scalp action dominating the marketplace. The market has been unable to turn over its intraday pace for a correction more in price than just time. This has kept me away from a great deal on the long side. With comparable up and downside pace on the 15-30 minute charts heading into Wednesday, I still do not have a strong intraday breakout bias, so I'll continue to rely on intraday action with my longer term bias favoring the bears. This will keep me more cautious on longs until I see a slowdown on selling and stronger upside moves intraday.

Updates: Position trades: HSP has support at the lows of the weekly bases. I am looking at acquiring NTRS as a position trade buy. It has bounced off the 20 week sma and now needs a daily setup to form. HCA as a position trade short from 9/20 hit trailing stops for a swing, but a larger position trade target is in the $43 zone.

Economic Reports and Events
Oct. 12: Crude Inventories 10/7 (10:30 am)
Oct. 13: Export Prices ex-ag. for Sep (8:30 am), Import Prices ex-oil for Sep (8:30 am), Initial Claims 10/08 (8:30 am), Trade Balance for Aug (8:30 am), Treasury Budget for Sep (2:00 pm)
Oct. 14: Core CPI for Sep (8:30 am), CPI for Sep (8:30 am), Retail Sales for Sep (8:30 am), Retail sales ex-auto for Sep (8:30 am), Capacity Utilization for Sp (9:15 am), Industrial Production for Sep (9:15 am), Mich Sentiment-Prel for Oct. (9:45 am), Business Inventories for Aug (10:00 am)
Oct. 17: NY Empire State Index for Oct. (8:30 am)
Oct. 18: Core PPI for Sep (8:30 am) PPI for Sep (8:30 am)

Earnings Announcements of Interest
Only stocks with an average daily volume of 500K+ are listed. List may not be complete so be sure to always check your stocks' earnings dates before holding a position overnight. (A) = Earnings after the close, (B) = Earnings before the open, (?) = Earnings time not specified at the time of this writing
Oct. 12: APOL (B), ASML (02:00 am ET), ENTG (B), FAST (B), HDI (B), HMT (B), LRCX (?), MTG (B), MON (B), SOSA (07:00 am ET)
Oct. 13: FCS (B), BPOP (A), TRB (B), WGO (B)
Oct. 14: BBT (B), FDC (?), GE (08:30 AM et), MI (B), NGAS (?), RF (B), UNH (B)
Oct. 17: AEP (?), C (B), CCK (A), ETN (B), FHN (B), GM (08:00 am ET), HAS (B), LSS (A), MDC (A), MAT (B), NVLS (A), OMM (A), RMBS (?), PHG (?), SVU (B), TMA (A), WB (B)
Oct. 18: MMM (B), ADTN (B), ASD (B), ASO (B), BSX (B), BCR (A), CNI (?), CDWC (?), CHB (A), CYMI (?), FITB (B), FRX (B), FCX (?), GENZ (B), GILD (A), GAP (?), INTC (?), JNJ (B), KEY (?), KFT (A), LLTC (A), MEL (?), MOT (A), NCC (B), NVS (?), PH (B), RYL (A), SAFC (07:45 am ET), STX (A), SOV (A), STT (?), STN (?), SYK (A), STI (B), TER (A), CAKE (A), USB (?), UTX (B), WFC (B), YHOO (?)

Toni Hansen is President and Co-founder of the Bastiat Group, Inc., and runs the popular Trading From Main Street. She can be reached at Toni@tradingfrommainstreet.com.