Good Morning, Traders. Day of divergence in the broad market averages on Thursday as the Dow and the Nasdaq moved in completely opposing directions, so much so that the Dow close up 64.12 points while the Nasdaq lost 8.33. Relatively rare occurrence but happens sometimes especially during earnings season when just one or two key Dow components reporting good numbers can push the index around greatly. The S&P was relatively flat, making an intraday push above the 2006 highs, but then falling back into range to close only 1.53 points over Wednesday's close. The ShadowTrader Core Sector List finished in "Christmas Tree" formation with exactly half its sectors gaining off of the open and half losing. Typical on a sideways, reversal type of day. Breadth was as expected, slightly positive on the NYSE and slightly negative on the Nasdaq. Overall volume was about flat with the prior day but stronger than average, which is not so hot for the bulls as a sideways day on better than average volume in the S&P often indicates institutional distribution or churning.

Keep an eye on gold and gold mining stocks in the near future. Yesterday was the first bearish day in some time the we have had in both the metal and the mining stocks. The chart above of GLD (StreetTracks Gold), the ETF that trades in lockstep with the actual commodity, clearly shows how steep the trend has become and how gold is more than likely ready for a pullback. Although the weekly chart above is not fully formed (the rightmost candle will "print" today at 4pm), the longer term chart is excellent for viewing how price has pulled away from the trend and possibly "gotten ahead of itself". This slight pullback should be a welcome sight to the astute trader. All signs point to gold moving higher this year, so any corrections are to be considered buying opportunities. The Big Picture has annotated the chart to show where support should come in.

Peter Reznicek is the Chief Equity Strategist and a principal of the Prana Fund, a domestic hedge fund, and ShadowTrader, a subsidiary of thinkorswim which provides coaching and education to its clients on both intraday and swing trading of equities. For a free trial to the full version of The Big Picture or to learn about ShadowTrader's other services, visit shadowtrader.net or send an email to preznicek@shadowtrader.net.