Today was nearly a mirror of yesterday, minus the bigger point losses and the higher volume. But that to me doesn’t matter as what is more important is the fact that for the second day in a row the market appeared as if it was ready to crack WIDE OPEN but instead caught a heavy bid rallying into the close to pair back a lot of the damage. Yes it was a down day but it was a “good” down day.

The selling was pretty bad intraday and in fact I did get a bit nervous. However, when I get nervous it is normally a good sign as the market normally doesn’t move well with my emotions. So the fact that I got a bit fearful was a contrarian signal. If I would have come back in the final hour, however, and the market would have been lower the entire tone of this commentary would be different. Instead of talking about stocks holding strong in the middle of selling, I would be discussing how pathetic the market is to set us up with some HOT charts and then slam the door shut in our face. Thankfully, the late day support came for the second day in a row and the bad news column was avoided.

However, throughout the day all I kept reading was bad news. I saw a report that said due to the poor growth of the factory orders and the pressure of rising oil were hurting stocks, when the market sold off. However, right at that moment Barack Obama started talking about his marxist dream that EVERYONE seems to be falling for. But did the liberal media pen anything on him? Of course not. Maybe it wasn’t him but I find it funny that as soon as the marxist starts talking the market starts falling. And then they go blame oil and traders now coming to grips of the factory orders report that caused the selling. Others said the selling was due to LEH needing $4 billion to rebuild its balance sheet. I could see that being the reason as at the same time Obama started talking LEH started tanking taking the banks and the market with it. So to me you can blame BOTH. If it was GWB giving the speech, you know everyone would have blamed him.

However, with an hour to go in the trading day, LEH came out and said that it was NOT seeking help from the Fed noting that the company has enough money. That then sent the stock off the lows moving into a strong close. That strong rally killing some of the losses earlier posted proved to me that some of the selling was LEH related. But the fact the market did not recover all the selling and then make some further progress proves to me it was NOT just LEH that caused the selling. Still, overall, the selling was nothing to worry about. Why?

Well, yesterday brought some of my longs down to key support. The funny thing is that all of those stocks bounced today, right when they needed to. If this market was real bad, easily 3/4 of them would have failed. Instead only 3 out of 10 stocks at important support failed.