The SPX was trying to hold its 11:00 A.M. lows, but this was just violated....

Chart courtesy of ILX Systems

I have received a number of questions on gold given the recent sell-off. There are a number of things going on here, but at the most basic level, I am watching the longer-term chart of the Amex Gold Bug Index (HUI) -

Created with SuperCharts by Omega Research

What stands out to me is that first and foremost, it is still in a longer-term uptrend as highlighted by the channel. The second point is that there are two support zones to watch. The major zone sits around 150 and capped the index repeatedly in 2002. The pullback earlier this year tested this zone as support. The index is still a good deal away from this level, so I wouldn't call it pertinent today, it is just something to note. The secondary support level is near 200. The index initially had trouble overtaking the zone this summer and a retest would not be out of the question.

While the recent selloff has been swift and somewhat brutal, I think the uptrend is still intact. I will add the caveat that I tend to be trend follower and therefore have a tendency to miss turning points. I am making excuses. I just want everyone to be aware of potential weaknesses to this analysis...

The indices have continued to weaken. This puts the SPX pretty much on the trendline of ascending lows...

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The sell-off is bringing the SPX back towards the trendline we discussed yesterday. That was the point at which the bulls were willing to step up and buy. It will be interesting to watch what happens as (if) we get back to this line again...

An hour into the session the indices have taken a turn lower. The COMP is still in positive territory but the bulls are on the run at the moment.