S&P 500, Dow and Nasdaq Futures got a charge over the weekend. It seems that the US Treasury take-over of Fannie Mae is going to be well received, if not with some apprehension. Sure they will rescue Fannie and Freddie from going belly up, but at what cost to tax payers? Some say $100s of billions. If you were holding Fannie puts going into the weekend, then good on ya! If you were long, then, well… I’m sorry for you.

Fed interventions like this usually result in a temporary bounce, or by some miracle it could put a charge in the market. I believe we should take a defensive posture and prepare for the bounce, followed by a weighty retraction, rather than hope for a rally. Hey, if the rally happens, then great! Just don’t count on more than a few days to the upside and use the strength to exit longs.

So, take heed with what the market has told us on Friday (September 5). Bad economic news, jobs down, and financials it total collapse, followed by rumors of a Fed intervention that reverse the freefall, essentially placing a tourniquet on the bleeding. This resulted in bullish reversal candlesticks on most indices and on many stocks. For example the S&P plotted a Bullish Hammer, while AAPL churned out what could be best described as a Spinning Top or High Wave candlestick pattern.

In any event the S&P retook critical levels. So what are the support and resistance levels we need to watch there? If on Monday we were to open above 1265, then I would say 1260-1265 is support. Resistance will be our old nemesis range of 1295-1305.

On the Naz we have support with the 50 day moving average, which is currently at 2328. Assuming of course that we gap up on Monday. If we do, resistance will be the 20-day moving average at 2385.

If AAPL can et above its 200-day and move above its 50-day at 169, that would be a major victory before the Tuesday’s Let’s Rock media event. The event will be held at the Yerba Buena Center for the Arts in San Francisco at 10 am PST.

If past Apple events were any predictor on future results, then I would have to say that AAPL the stock will probably get an initial surge in price followed by a plunge in the same day. Then once the news filters through the market, and the analysts have their say, it will likely be perceived as a good thing. However in this particular event, there’s growing sentiment among Apple analysts that it will be and underwhelming announcement.