MARKET COMMENTARY (10-01-09)

I'm continuing to look at the 20-day MA for the initial reaction in the SPX. I am also looking to see if it may possibly need the help of the 50-day MA, which will bring the market into a flat, neutral range. The latter is a threat to the rally. So far, I see an orderly pullback and nothing that suggests that we go crashing down.

There are a few things that I need to talk about regarding the individual sectors. The XLB, XLV, XLI, XLU, XLF, and XLE are consolidating nicely, which is expected. However, I am focusing on the XLK, XLP, and XLY. Make note that that these three are forming the apex of their respective wedges. A resolution here may foreshadow what is to come in the next few days/weeks.