THE SETUP

Markets are trading higher shrugging off the soggy sales news from TGT etc and are running right into major resistance on the SPX at the 1,490/1,500 area.

Strong sectors- homies, airlines, financials, small caps, oil service, trannies and real estate- lagging are retail, utils, drugs and large caps.

Key stocks- 25 out of 40 higher led by MA DECK POT ISRG AAPL KLAC GRMN AMAZN RIMM and GOOG while TIF BIDU UA BG GS KO MO NVDA lag.

NYSE- 975 net winners;

NAZ -840 net winners;

NDX -45 WINNERS;

OEX-60 WINNERS;

IBD 100- 70 WINNERS;

Winners- LIFC CF FSTR BUCY SSRX SNDA LRCX DISCA UAUA XLNX CEPH AIG RTN NSM IP WY NSC LEH JPM BNI;

Losers- TGT LTD BMY T VZ AES EXC WMT AEP LKQX MBT GSOL MR AIRM PAY FLIR RYAAY SHLD CTSH MNST ERIC PETM PDCO;

VIX- down 1% and trading 10% below the 10 day SMA;

Up volume 2X Down volume;

Technically, we are setting up for a fall as we run right into major SPX resistance, low oversold VIX readings and RSI (2) readings at near 80 on major indexes. Trailing some stops here and maybe taking off some YM futures.