THE CLOSE

Markets closed up after giving up much of the days gains as sellers decided enough was enough as the DJIA closed +65 after being up 165, the SPX +5.5 after being up 17 and the NAZ +1.5 after hitting its head earlier at the SMA 200.

One explanation I read that looked pretty good was this from briefing- "we think the failure of the DOW & SP 500 to put in new afternoon highs made longs a bit skittish as momentum & volume dried up, causing some longs to abandon their positions."

Another reason, VIX over sold and at /near multi month lows, SPX rejected again at the May 6 highs at /near 1420 and the failure of the financials to participate - note WB WFC GS LEH all at/near the flat line to red most of the day.

Strongest sectors- homies, retail, telecom gaming and semis while oils, metals, ags and steel lagged.

NYSE- 600 net winners;

NAZ- flat;

NDX- 68 GREEN;

OEX-75 GREEN;

IBD-28 GREEN;

VIX- 17.65 down 2%;

Up volume 1.5X the down - overall light again at almost 1.2B shares traded;

TRIN- .83;

NQ futures continue to sell off after the close and a brief rest by the markets would not come as a surprise after the recent run. Wait for lower RSI (2) levels and a higher VIX to reinitiate longs. And congrats to those who took the morning advice and tightened up the stops.