Good day! The market had a pretty rough day on Thursday. After a strong upside move Wednesday morning, the indices began to pull back into the afternoon. This pullback continued into yesterday, although the SP500 managed to move slightly higher with the open.

The main characteristic of the day on Thursday was its choppiness. After the open we saw a range along the 5 minute 20 sma in the NASDAQ and Dow. This gave way to further downside into the 10:15 ET reversal period. The NASDAQ stalled only as it came into support from the prior afternoon's lows and brought the SP500 into its 5 minute 20 sma support.

We saw some decent divergence between the indices as well. The SP500, for instance, hugged its 5 minute 20 sma for quite awhile, also holding the 15 minute 10 sma. This created a larger time frame Avalanche pattern that triggered just before noon, setting up on the 2 minute charts with a smaller setup around 11:30 ET and continuing with the trend channel break into 12:00 ET. The Dow formed the same pattern on the larger time frames, but was already under the 5 minute 20 sma and hugged the 15 minute 20 sma instead. The pattern was helped out by declining volume within the base.

The NASDAQ, on the other hand, broke earlier for a continuation lower on a 5 minute bear flag into 11:00 ET. It hit support with that reversal period at the 15 minute 200 sma and the 5 minute 200 sma. The index then bounced to the prior 5 minute highs before it continued lower with the rest of the market, dropping until the Dow came into support at its own 5 minute 200 sma intraday.

If you look at the 5 minute charts you can see a great deal of overlap from bar to bar. Also, within the bases, pace would turn over quickly both ways. It might look bullish one moment due to stronger rallies, only to turn and head quickly back lower. This made it easier to get whipped or flushed out of positions and also made for larger stops and fewer decent patterns to start with. The market had tried again for another 15 minute bear flag, but even though it triggered into 14:00 ET in the SP500 and Dow by breaking the channel of the correction off lows, the NASDAQ had bounced more quickly and wasn't willing to give up. It held the 5 minute 20 sma and the SP500 and Dow soon turned over to move higher as well, albeit still higher risk. This rally took the market into the prior highs intraday in the SP500 where the market hit strong price resistance and sold off once again into the close.

CVS stops can be kept under Tuesday's lows. XEC has made new lows, as did UNT. Both can have adjusted stops over the highs of the week so far. I added ESLR, MRK, MYL and CTXS before the open yesterday for swings. ESLR is too late at this point, but the other three are worth watching for 15-60 minute setups for continued upside. I still think that the market will correct off lows going into early next week. The problem as far as risk goes is that it's doing it so far with a range, making for the more erratic trading we've been seeing. Use added caution into the weekend.

Economic Reports and Events
Apr 01: Average Workweek for Mar (8:30 am), Hourly Earnings for Mar (8:30 am), Nonfarm Payrolls for Mar (8:30 am), Unemployment Rate for Mar (8:30 am), Mich. Sentiment-Rev. for Mar (8:30 am), Construction Spending for Feb. (10:00 am), ISM Index for Mar (10:00 am), Auto Sales for Mar (12:00 am), Truck Sales for Mar (12:00 am)
Apr 04: -
Apr 05: ISM Services for Mar (10:00 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
Apr 01: -
Apr 04: -
Apr 05: RIMM (A)

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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.