Mike Paulenoff, author of MPTrader.com, is bullish on commodities at the moment. He writes:

My near term technical work in the U.S. Natural Gas Fund ETF (NYSE: UNG) argues that a significant low was established yesterday morning at 17.76, and that the first upleg of an incomplete recovery rally phase ended this morning at 19.54. The weakness during the early part of Tuesday, into the 18.26 area, represents a deep pullback within an otherwise viable counter trend rally-- that should head for 20.00/50 next. Only a decline that breaks 17.76 will wreck my current scenario.

UNG

Spot gold prices continue to hold just above $900/ounce, which is a very impressive sign of relative strength within a near term overbought condition. Looking at the pattern developing in the SPDR Gold Shares (NYSE: GLD), the GLD weakness since yesterday morning off of Friday's 91.49 high has held the near-term up trendline at 88.30. This morning prices have turned up from the low at 88.31. The question is whether or not the upside pivot off of 88.30 represents a complete correction within a larger bull trend and as such the start of a new upleg.

Right now all I can confirm is that the GLD is exhibiting a very bullish profile. The quality and power of forthcoming strength will determine and confirm whether or not the GLD is in a new upleg, which will have a target of 94.00 on the way to 100.
Conversely, failure to sustain a rally followed by a break of 88.30 will argue that a deeper, more complex corrective pattern is unfolding from last Friday's high.

GLD

Jack Steiman, author of SwingTradeOnline.com, also has more bullish sentiment than usual at the moment:

The VIX was heading towards a breakout yesterday over the 50-day simple moving average at 51.12. It got near 50 when it reversed hard and fell way back as the day progressed. The gap up open was its high for the day. The same is true for the VXN. Both closed up for the day but almost 10% off their gap up highs. The fact that this took place right under strong resistance (those 50 days just mentioned) says the market may be ready to try and bounce once again. Every time we get close to that 805 pivot (812 on Monday) the market finds a way to hold on. This long-term lateral consolidation is getting old in the tooth and frustrating everyone for sure. How many times can the bears fail to take out 805 before they give up for a more extended period of time is what all the bulls are wondering.

The 60 minute charts just can't stay oversold for very long. As soon as their RSIs get to 30 or slightly below they reverse and the market goes back up. Normally, in bear markets, things can stay oversold but that's not happening right now on the short term charts, thus everyone is getting frustrated. The daily stochastics are now moving back to oversold as well, so the bears are going to have to break this down at oversold and thus far they haven't been able to do so.

There is a lot of ugliness away from tech these days. The transports are breaking down badly and the leaders are on huge technical breakdowns. Fedex (NYSE: FDX) and United Parcel (NYSE: UPS), to name a few. The banks/financials continue to be a nightmare overall. Two leading sectors of the stock market are simply not getting the job down for the bulls. Commodity stocks still aren't doing anything worthwhile as well.

On the brighter side, tech stocks are behaving more favorably. Some huge advances in stocks such as Amazon (Nasdaq: AMZN), Google (Nasdaq: GOOG), Research in Motion (Nasdaq: RIMM) and Apple (Nadsaq: AAPL), to name a few. The Street like their earnings reports, and they are definitely keeping a floor underneath the market. They keep moving higher even into overbought territory and not-so-great divergences from time to time on their short term charts. Bullish stocks tend to stay up longer than bearish stocks tend to stay down at overbought/oversold. What we need to watch for now is how these leaders handle overbought and not the best divergences going forward. If they just fall apart then the market is extremely vulnerable. If they have short term and contained pullbacks, the market has a fighting chance here until the weaker sectors can get their act together.

Gary Dean, author of MarketsPath.com, is cautious but also leaning to the long side:

I am getting some conflicting data in the options pit, where they are buying the OEX puts (setting up for more downside tape) and selling SPX puts (setting up for upside tape) The Q's (Nasdaq: QQQQ) are neutral and the Dow is on a sell signal. This tells us to expect some more whipsaw tape with a bias to the upside in the coming hours.

They were selling this recent push up hard in the institutional "smart money" volume indicator, but were quick to defend the recent pullback -- again -- telling us to expect whip saw tape. They have built up enough buying volume over the last four days to keep a rally heading higher if they want and why I am leaning on the bulls side today.

The chart patterns are somewhat bullish today, but I can't rule out another leg down before a meaningful rally hits the tape.
Still watching that 820 SPX target, and I have a feeling it may get hit. If it is following that channel-then the short-term target would be the 835-840 area. I am still thinking the 850 comes into play when all is said and done-with the door open for a move to the 890 area.

Still too dangerous to do anything here. We should continue to see whipsaw tape until we get full buy-in from the options pit, and we aren't getting that right now.

According to Harry Boxer, author of TheTechTrader.com:

The S&P 500 is showing a basing formation, but has moved down below the moving averages and then back up and failed at the 21 and 40 dma, and is currently in a pullback retest mode. Looking at a 15-min chart you'll see we were in an uptrend for several days and now in a downtrend, although attempting to base here and potentially break out. The Nasdaq 15-minute chart shows a similar pattern, although more of a left shoulder, head and right shoulder, with a break of the neckline on Monday late in the session. The daily chart shows more of a rising bottoms line and it did bounce off that line on Monday, perhaps part of the reason for the NDX strength. NDX support is currently in the 1135-40 zone, and minor support around 1160, but it rallied to close at 1195.75 and touched cover 1200 today for the first time in a week. Resistance is in the 1246-52 zone. S&P 500 resistance is 877-80, near the moving averages, and it would be very bullish if the markets could get up through that prior high and moving average. That would augur well for future market direction. Support on the S&P is at the 800-05 zone at the multiple session lows.

Some stocks Harry's watching closely:

  • Palm Inc. (PALM) has a tremendous 45-degree angle rising channel. The stock has been consolidating the big run-up it had in December and early January, and though volume is dwindling underlying technicals are holding up well, and it wouldn't surprise me if the stock broke out of this and surged into the 11-12 zone. Certainly one to keep an eye on on any breakout that takes this over the 8 1/2-8.30 range.

  • DG FastChannel (DGIT) has been basing out with a left shoulder, head, right shoulder. It ran up to the neckline and backed off to the moving averages. Today was up 47 cents on very light volume. I need to see more volume and the stock to break through 16 for this one to get going, but it looks like the high teens in store for that one.

  • Net 1 Ueps Technologies (UEPS) is in a promising basing formation over the last 3-4 months. Pulled back just above our model portfolio stop point under 11, and moved back up again. I'd like to see the stock take out 15 and move into the 17 1/2-18 zone, perhaps even as high as 20-21. That may occur in the next few weeks if the market cooperates.

  • Emergent Group (LZR): Very bullish looking chart pattern. It broke out in December, consolidated, broke out again in late December, consolidated again, and now it's in a bigger consolidation. This also could be construed as a head-and-shoulders top, but the volume and underlying technicals belie that. Support around the 6 1/2-3/4 level is holding, and I'm looking for higher prices.

  • ArcSight (ARST) is in a very strong rising channel, very similar to PALM, currently in a rising flag pattern, great technicals. This stock looks like it could explode to the upside and head up to test the August highs around 12 1/2-13. Certainly, any downside movement should be contained at about the 8.40-.50 zone.