SPX Daily Chart - 4 May 2011

     The pullback almost reached the short (red) moving average yesterday and so this point still should still be considered the first level of support. The low yesterday was at a confluence of Fibonacci support (see chart). Lower is the medium (blue) moving average and then the long (green) average. Note that the short average aligns with a 50% Fib retrace of the setup, the medium average with a 78.6% Fib retrace and the long average with TDST Support itself. We should also note the large gap just above TDST support. The short moving average on the weekly chart is at 1326.08 right now, adding further emphasis to the daily medium average level.
     Continuing the discussion on qualified breakouts from yesterday .... I have marked the March 1 bar with an arrow. One can say that this price bar broke the medium (blue) moving average by closing below it. On March 2 the break was "qualified". But instead of continuing lower the market shot higher the next session. My tentative belief is that the qualified break was a warning that lower lows were still to come and this played out. Also note that on March 3 and March 8 the upside breaks of the short (red) moving average were not qualified and the rally attempt failed.
     On March 23 the upside break of the short moving average was qualified the next day and the rally continued. On March 25 there was an upside break of the medium moving average. It was qualified the next day, and after an attempt to move lower the rally asserted itself.
     The downside break of the short moving average of April 11 was qualified and the market sold off into the April 18 low where the long moving average held. Please note that on April 18 the medium moving average was also broken but the break never qualified. The minor rally from that low then began. Upside breaks of the medium and short moving averages occurred on April 19 and 20 respectively and were both qualified.
     Again, only a small sample size but at least with the moving averages the implication seems to be that a qualified break of the line is required for the trend to continue.
     Bottom Line:  The allocation mix meter has been raised back to +100%. The first TD Trend Factor target off the March low is at 1391.7 and is marked on the chart. 1391 is also 240 degrees up from the April 18 low.