Unemployment Rate Plunges

SUMMARY:
- Strangely mixed jobs report taken as a glass half full, half empty by the market.
- Non-farm payrolls miss, but unemployment rate plunges: which do you trust?
- After all the analysis, jobs remain crappy, private small business creation is improving thanks to US entrepreneurship, and the Fed remains with its foot on the gas.
- Choppy but upside week avoids a correction overall, but some sectors are in private corrections.
- Trend remains in place, but the rally into earnings and the lagging small caps remain the worries for a market that is a bit overbought.

MARKET OVERVIEW

Market takes some solace from the unemployment rate, but not enough to rally.

Investors were scratching their heads on Friday morning. With more government data, you can understand why people would be confused, but there was even more reason for confusion this time around. Nonfarm payrolls for December came in well below expectations at 103K versus 150K expected officially. The whisper number was up to 200K or more not even close. Revisions to October and November did help bring the December number closer to expectations. There were 70K more jobs. Adding that back to the 103K, that put it easily over 150K and more in the line with the 175-200K whisper number on the street.

That was not bad, but futures tumbled on the news. They were able to rebound because of the unemployment rate. It was expected to come in at 9.7% after 9.8% in November, but it tumbled to 9.4%. Hallelujah, we are in nirvana. We had the largest, most rapid decline in the unemployment rate since April of 1998. Certainly President Obama was pleased about it, but does it really mean what they say it means? Numbers can be deceiving and they typically are. The workforce contracted, falling by 260K. Those are people who just gave up. If jobs are so plentiful, why could they not find work? When you have a drop in the size of the workforce, the unemployment rate goes down even without any more jobs.

That is part of the equation, but the 260K does not account for such a large decline. Former Fed officials on the financial stations said the nonfarm payroll number is the one that makes the difference. They were saying that back in the recession of 2000-2001. The household survey was improving, but the Fed said not to look at that. Greenspan was even in front of Congress saying you cannot look at that. He kept saying the nonfarms is the key, but the economy was recovering. Jobs were being created even when the nonfarm payroll and the supposedly jobless recovery raged on. That is the old entrepreneurial American spirit. If you cannot find a job after a while, you make your own damn job. People are starting their own businesses. They cannot find work at those companies that laid them off, especially the big corporations that are still net job losers.

Enough people told the BLS that they were finding jobs to help bring the unemployment rate to the downside. If you are working at your own business, you are working at a job. The government may not seem to think that, but that is the case. The nonfarm payrolls data failed to pick that up. They do not pick up on new jobs and new businesses being created. It is not the greatest environment for business creation. The tax levels are not favorable, although they were extended and that may have helped. We still do not have a good economic environment to start a small business, although they say a recession is a great time to start a small business. We may have some good, powerful companies coming up in the works. Maybe some more AAPL or CSCO who knows? It could be very interesting several years down the road.

The combination of factors lowered the unemployment rate. Number one, the jobs pool fell so the unemployment rate fell as well. Fewer people seeking jobs makes it look better than it really is. Number two, there are businesses where people are going to work. They are not the ones that the government lavished the stimulus funds on. These are people who are just fed up with waiting around while the government keeps picking at their wallets; they are going out to make money. As Ronald Reagan said, the best thing you can do for yourself is make a lot of money, keep as much of it as you can, and not send it to the government. That is what they are try trying to do, and that is about as American as you can get. That is part of the reason for improvement in the unemployment rate while the nonfarm payroll number still reeks.

It is interesting to note that the average workweek held steady at 34.3. After clicking up a couple of tenths over the past six months, it is stalled out again. That is an indication that the big companies the government looks to for providing jobs growth (although we know they do not) are going nowhere in a hurry. When the average hourly workweek does not improve, the companies are not in position to hire. They have to start working the current workers very hard before they will hire new people. The workweek tells us that is simply not happening.

The market was somewhat confused. Looking at the SPY, the futures were up moving into the jobs report, though not up very much. They then tumbled to negative, recovered to positive, and then bounced up and down through a choppy morning and sold off through the early afternoon. They did post a decent recovery to end the week, and that left the market in decent position overall. The indices were up for the week. It was not a massive move, but they did a good job. This was the week that everyone came back to work, and the market had rallied from the late-November test. It put in a strong move. That is its second good move off of the August low, and it was due a correction.

I thought there could be some profit taking, and the market managed to shake it off. There was profit taking, no doubt. Some of the sectors that led the move higher some commodities, energy, and retail all suffered at the hands of sellers last week. They were not total collapses, but there are sharp pullbacks in these areas. At the same time, other groups were moving higher. Tech and semiconductors got new life. Healthcare and medical got new life with money flowing their way on volume. The market saw rotation. It was not able to rally sharply. It did move higher, but it was not rallying because there were leadership sectors struggling and fading back. At the same time, it did not collapse; it consolidated its moves in place. There is a transition going on. Money is moving around the market, but it is moving around rapidly enough and in enough key areas to keep the indices higher.

There are questions heading into next week. There is the start of earnings and what the market will do given the good rally into earnings, and the SP600 is lagging. It did not collapse, but it was flat on the week. It was not able to post that rally or make the early-week surge stick as the small caps lag. That is not good news for the economy because the recovery is still very early, very tender, and has a long way to go. It is too early for the small caps to give up the leadership mantle unless this is a really pathetic economic recovery that will not last long. If it is a short one, maybe the small caps should start to peel back. I do not think that is the case, however. Looking at the SP500, it was in a big base, and it broke out and tested. It should have a lot more upside. I am somewhat concerned if the market can continue to rally moving into the next two to three weeks. There are good reasons for it to have issues. It has rallied into earnings and the small caps continue to lag.


OTHER MARKETS

Dollar: The dollar found a lot of strength this week, and it broke over the last December peak with another decent move (1.2907 versus 1.3014 Thursday). A very strong week for the greenback as the economic data improved and the likelihood of the Fed continuing to print money decreased. That naturally bolsters the currency. It now has to deal with the late-November peak, and that will be important. This range from the August low up to the November peak is a resistance level. There are areas of consolidation that it has to punch through. It may not make it in one continuing move to the upside. It may stop, pause, regroup, and then try to make the break. It looks like the dollar has turned over a new leaf. After rallying, it looked like it was topping out and ready to fall, but it found a lot of strength courtesy of improving economic data.

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Bonds: Bonds managed to gain some strength (10 year 3.32% versus 3.41% Thursday). Bonds were kicked around early in the week. On Friday they held support and were trying to bounce again. This is the same support they held last week. It looked like they would bounce and did, but they could not keep it moving. They are trying to resume the upside, however, once again holding. It looks like they may pull it off. It is a market in transition now, and there are some trends being tested, bumped, and maybe even broken. Again, you have to look at the small caps. All of this is on the doorstep of earnings season.

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Gold: Gold was down on the day, but it recovered nicely off its lows ($1,368.70, -3.00). Gold had rallied up to its prior peaks and was looking good, but then it was body slammed this week. It started on Tuesday with a real hammering, and it was off to the downside again on Friday. It was looking really weak but managed to reverse. There is a bit of buying ongoing, but gold suddenly looks shaky. It has to prove something. Dare I say it? It has to show its mettle.

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Oil: Oil had a great run. It ran well from early November into late December, and then it just had to come back. It did this week, but it was not a total breakdown. There were some impressive daily losses no doubt, but it did give up the ghost. It happened at the 50 day EMA on Friday, reversed and bounced, and it was looking decent. It closed lower, and after hours it moved higher ($88.03,
-0.60). There was no damage done. It consolidated a good move to the upside and held a logical support level, i.e., the 50 day EMA, the early December consolidation, and the mid-November peak. It held a logical place to find support, and now I bet we will see it bounce higher from here. Oh, joy. That will certainly make all other petroleum-based products rise in price yet again because the move is sustained. It is not one of those that jacked right up and then turned over and fell back down. It is showing it can hold its moves and hold its gain. Prices of all petroleum-based products are being increased even as we speak.

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TECHNICAL SUMMARY

INTERNALS

Volume. Volume was lower, down 7% on NASDAQ to 1.9B. Volume on the NYSE fell 0.5%, basically flat at 1.08B.

Breadth. Breadth was negative at -1.7:1 on the NASDAQ and -1.4:1 on the NYSE. The small caps lagged. It is interesting to see that breadth was not atrocious again on the NYSE even though there was trouble in the small caps. The internals were not that negative. There was good volume on the week, and there was positive volume with upside days on upside volume. There was some distribution as well with downside days on rising volume.


CHARTS

SP500. SP500 is flat to end the week. It rallied Monday-Wednesday and then tapered off Thursday and Friday. Note it is holding its near support easily. It rallied back from the lows on Friday. The buyers stepped right back in and bought it up when it looked like it might be the trouble. Remember, this is a big base that started in late April. The market rallied up, tried to break out of it, and just cracked it in early November. It faded back, formed a handle, and then broke out. This is really the first breakout move for SP500. It has put in two good moves off the August low now, but this is only the first breakout low.

I expect a test. Not that this recent run is as long as the August-November run. It does not necessarily have to be because this is a breakout move. The small caps are lagging and earnings are right around the corner after a nice run. Often you get the news built in, and comparisons will be tougher this year than last year. There is room for disappointment. The market is hemming and hawing but holding its gain. It is consolidating in place as some of the energy stocks struggle and lose money while others in tech land gain money. The trend is staying in place, but I am cautious given the proximity to earnings and the move thus far.

NASDAQ. NASDAQ is the same story, although it put in a bit more upside. It had a nice week, gapping higher on Monday and then moving higher through Friday. It did lose some ground, however. As with the SP500, it tested near support and recovered nicely into the close, holding its trend above near support. NASDAQ had a nice breakout, rallied from the August lows, and had its test. It has rallied nicely, moving up ahead of earnings. That leaves it vulnerable if earnings are not super. Even if earnings are super, sometimes it is not enough to support the stock or index further as the news is built in.

SP600. SP600 is the worry. There is a nice run here as well, but there is not the gain on the week. There is a big struggle. There was the engulfing pattern on Tuesday, and there was the inside day on Wednesday that did not change anything. Thursday and Friday did not alter the pattern at all. There is still an engulfing pattern more or less in control near term, and it is trying to direct the SP600 lower. The overall trendline remains in effect, but SP600 is showing signs of wear and tear. We will see if it has the ability to hold and continue to the upside next week.

SOX. The semiconductors were the only index up on the session, rising a powerful 0.23%. After three weeks of a lateral move over the 18 day EMA, they showed power on Thursday with a great move. I expect the semiconductors to show additional power in the future. They have set up a good pattern and are not really overextended. They have consolidated for three weeks, and they are ready to move if they get good results from some semiconductors companies. It did not happen on Friday as NVLS was downgraded. That set the tone, but it did not take the sector down. That is important, of course.


LEADERSHIP

Financial. Financials had a good week. They got a bit choppy on Friday with JPM reaching lower, but what a nice comeback intraday. GS had a tap at the 18 day EMA and a nice comeback as well. EWBC was up on the day, gave it up, and it finished down slightly. It is still in excellent shape as it continues to the upside. SP500 still has the support of the financials, and they helped it move. In the summer, we were waiting and waiting for the financials to move. They finally got a fire lit under them and are moving for a change. No complaints.

Energy. HAL thumped lower on Thursday. It held the 50 day EMA on Friday, and maybe it can bounce. BTU sold off hard on Thursday and bounced a bit on Friday. Volume was better. We will see. It is not a rollover, selloff, and massive plunge by these stocks; it is more like a needed correction. These engulfing patterns came in and started taking the stocks lower.

Semiconductors. Semiconductors had a good week, finally making the break on Thursday. NVDA was a leader, surging to the upside. It looked like it was getting weak on the day and may be running out on its move, so we took the rest of the January options off the table (for a 350% gain in this case). It turned out we probably could have squeezed a bit more out of them, but I said we would move out and take the rest off when it started to fall. It did not collapse but still shows it is moving well, and semiconductors are moving well in general. ALTR did not finish that well, but overall I liked the pattern. The semiconductors are getting money thrown their way, and of course we will be more than happy to participate as they do.

Healthcare/Drugs. Healthcare had a good week. ZOLL made us great money, surging higher and continuing to the upside on Friday. UTHR is still moving to the upside. It showed great volume this week. It is really starting to move out of a six-week, lateral, very tight consolidation. We took gain on it, following our plan as it hit this target. Not huge. Almost 12% on the stock and 70% or so on the options. That is not bad for an initial target. Things are moving somewhat decently to the upside.

Technology. Technology gained some ground. AAPL was a nice leader on the week, moving up quite well. FFIV broke higher. It could not finish strong, but we may get a pre-earnings run out of it. If not we will bag it, but there is money moving into semiconductors and techs in general. Software stocks seem to do pretty well. BCSI is a case in point, putting in a nice move on the week. We had January options in it as well. We were trying to get more out of it and were able to take 200% on some positions and 150% on other options. We banked a little more gain on stock positions 46% on one and almost 30% on another. A nice mover getting new life once more.

Industrial. Industrials were a leader on the way up, but they took the week off. CAT has been moving laterally for a couple of weeks. CMI is moving laterally. It tried to make the break higher, but it was thrust back down. CAT has rallied nicely. It may be a little overbought, but it is not coming back. It could be setting up for a new move. I say that because there was another flat consolidation in September and October, and it made the break to the upside and produced another good run. We ought to be looking for that now even though a lot of people say the market is overvalued and the stocks are way too high. They may be, but we do not know for sure; they could always break higher.

One man's high is another man's low, and both of them could be rich. One guy could have ridden the stock from lower, thought it was too high, and was ready to sell out. The other could have bought into it on this pattern and then it rallies again. They would both make money. People get too critical of other opinions in the market. If there was only one way to make money in the market, then your opinion might mean something. There are so many ways to make money in the market and so many different strategies and methodologies. One person's high could very well be another person's low.

In summary, there was some rotation this week. There were stocks getting beat up badly in the market. A lot of that had to do with the energy sector. They were getting knocked around, and the retail sectors were getting knocked around. Both of them were decent leaders on the way up. If they are not going to get the money, it has to go somewhere. It was moving into software, technology, semiconductors, and healthcare and medical. It will likely move into other areas shortly. We will have to keep our eyes open and see where it heads. That is the beauty of a market that has a lot of liquidity: It continues to move higher, but sometimes it will change horses and pick a new lead team to move the market to the upside.


THE MARKET

MARKET SENTIMENT

VIX. The VIX is basically going nowhere. This has been the fear for many television pundits over the past couple of months. They are concerned that the VIX is at historically low levels and that can cause trouble. Well, the earth can open up and swallow us all tomorrow as well. No, that is not really a problem for us. Looking back, the VIX can stay at very low levels for very long periods of time while the market is moving higher. During 2004-2007 the market moved up. You have a problem when the volatility rises while the market rises. That happened in 2007. That is when you have a correction coming, and that is not the case here. Volatility can stay low for a long, long time while the market rallies, and it is not even down to those levels now. It is not showing a correlation of up and down with the market. It does sometimes, but it is not doing it now. I am not going to get bent out of shape about it.

VIX: 17.14; -0.26
VXN: 18.72; +0.31
VXO: 16.05; -0.17

Put/Call Ratio (CBOE): 0.91; +0.16

Bulls versus Bears:

This is a reading of the number of bullish investment advisors versus bearish advisors. The reason you look at this is that it gives you an idea of how bullish investors are. If they are too bullish then everyone is in the market and it is heading for a top: if everyone wants to be in the market, then all the money is in and there is no more new cash to drive it higher. On the other side of the spectrum if there are a lot of bears then there is a lot of cash on the sideline, and as the market rallies it drags that cash in as the bears give in. That cash provides the market the fuel to move higher. If bears are low it is the same as a lot of bulls: everyone is in and the market does not have the cash to drive it higher.

Bulls: 54.5% versus 55.6%. Second week of fade after hitting 58.8% on this run's high (thus far). Dipped at year end as many anticipate a first of the year correction. Again you have to as if this is self-fulfilling given the market is still trending higher. Still high in a string of high readings but below the 5 year high at 62.0. Still bearish enough. Closing in on the level considered bearish, i.e. where so many are in the market and believe it is going up that the ammunition to send it higher runs low. This is where you start to be careful and watch for breakdowns, but there is also a lot of liquidity being pushed into the market and that can continue the move despite excess bullishness. The crossover level at 29% bulls is long gone, but it did its job. The high on the last leg was 56.0% after starting at 35.6% on the low in February, the lowest it has been since July 2009 . . . until this last leg. 35% is the threshold level suggesting bullishness. Again, to be seriously bearish it needs to get up to the 60% to 65% level.

Bears: 20.5% versus 20.0%. Hanging around in the 20% range as the bears are not growing as the bulls weaken slightly. That suggests overall that investors believe the market will continue to advance after a pullback. Down from 28.3% in September. The 37.7% peak at the height of the crossover is well in the rearview mirror but bears remain well below the 35% level, above which is considered bullish for the market overall. Hit 18.7% on the low in April. Hit a high of 27.8% level on the prior leg in February. For reference, cracking above the 35% threshold considered bullish. Hit a high on the prior run at 47.2%. For more reference, bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment. Prior levels for comparison: Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). That was a huge turn, unlike any seen in recent history.


NASDAQ

Stats: -6.72 points (-0.25%) to close at 2703.17
Volume: 1.925B (-7.29%)

Up Volume: 775.296M (-443.34M)
Down Volume: 1.193B (+337.784M)

A/D and Hi/Lo: Decliners led 1.69 to 1
Previous Session: Decliners led 1.28 to 1

New Highs: 150 (-39)
New Lows: 7 (-1)

NASDAQ CHART: http://investmenthouse.com/ihmedia/NASDAQ.jpeg

NASDAQ 100 CHART: http://investmenthouse.com/ihmedia/NASDAQ100.jpeg

SOX CHART: http://investmenthouse.com/ihmedia/SOX.jpeg


SP500/NYSE

Stats: -2.35 points (-0.18%) to close at 1271.5
NYSE Volume: 1.086B (-0.57%)

Up Volume: 433.68M (+79.698M)
Down Volume: 639.055M (-83.862M)

A/D and Hi/Lo: Decliners led 1.37 to 1
Previous Session: Decliners led 1.64 to 1

New Highs: 256 (-102)
New Lows: 18 (-11)

SP500 CHART: http://investmenthouse.com/ihmedia/SP500.jpeg

SP600 CHART: http://investmenthouse.com/ihmedia/SP600.jpeg


DJ30

Stats: -22.55 points (-0.19%) to close at 11674.76
Volume DJ30: 189M shares Friday versus 193M shares Thursday.

DJ30 CHART: http://www.investmenthouse.com/ihmedia/DJ30.jpeg


MONDAY

Inventories, PPI, CPI, retail sales, industrial production, Michigan Sentiment there is a lot of data coming. It is somewhat anticlimactic after the jobs report, but given the mixed picture in the jobs report, it makes it all the more important. We have to keep an eye on that. Earnings are coming up. As seen on Friday, there are already warnings out there. VLTR warned about the quarter, and it was all over the map. It finished up, but I did not have enough Pepto-Bismol to get into that on Friday. LIZ was having trouble, too. They joined stocks from the Thursday same store sales that were not great, and they got slaughtered.

We are still going to look for more plays to the upside. We have had a great run to this point. We are into earnings, and even if earnings are blowout we have seen stocks pull back. MOS reported some super earnings this week, but look what happened. It tried to move up a bit, but it had all of its move on the triangle break. It is having a hard time getting up and going again.

That is instructive. We have a lot of stocks that are up, moving into their earnings. They may be a little overripe and ready to be picked or fall to the ground. That does not mean they will collapse, but look what happens if you warn. LIZ has already pulled back for a week and a half going into its earnings. When it pre-announced some bad news, it gapped below the 200 day EMA. My friends, this is what you call a breakaway gap to the downside. It is worth trying to play this.

Breakaway gaps tend to continue in the direction of the gap. The only problem is that it is a $6.00 stock and it will probably be difficult to make a lot of money on the downside. It does not mean you cannot, but there is a lot of support around the $5.00 level and it is already at $6.00. It is tougher to make money on, but look for things like this. If you get the right stock, you can make money off of it.

We have a mixed jobs report, and earnings could be a problem as well. You still have the Fed coming in with a lot of liquidity and there is an improving economy. The comps on the earnings might be more difficult. The market has moved up for a few weeks, and we could be ripe for some selling on stocks. We do not just pick any stock, however. There are stocks out there showing those engulfing patterns; they move higher one day and then are swallowed up the next day with a big downside move.

We have a test of those late in the week. They could provide downside opportunity, particularly going into a market that has rallied up into earnings. We could have some downside there, but we do not want to just pick the best stocks and say it has gone up a long way and short it. That is a suicide pact. It is like stepping in front of a train hoping it will derail. Strong stocks can come back in selling, but it is a tough game to play, particularly with the liquidity still in the market. As soon as it breaks lower one day, it turns around and bounces back in your face. We saw this with so many stocks today. They were selling and then reversed and finished well off their lows. We want to pick stocks that are weakening anyway. We will look at those engulfing patterns.

We will also look at the upside. There are stocks that will not report until the end of February. They could be very strong. The market is trending higher overall. If they have a great pattern and good set up, we will not ignore those even though we are in earnings and the market is a bit overbought. It could turn around and hit us on the head with a hammer. I am willing to take a couple of lumps on the head, but not a lot of them. We will be careful with what we buy as always. We will pick up stocks that say "buy me," and are in position and have the great risk/reward. If they go against us, they are not going to hurt that much, but we have potential for plenty of upside.

There is money rotating through the market. If it continues rotating, that means it will find new places to go. If earnings cause a pullback, they could still pull back. If the money is moving into those in anticipation of earnings, there is less likelihood that they fall significantly. We will start putting money to work slowly. Not the whole position a piece at a time when we get the opportunity. We may lose out on some big moves, but it is worth it to be cautious at this point. The market has run well and we are going into earnings. Warnings are not being treated very kindly, and even some good earnings results are not being treated well. The risk/reward there is not as great, so we will not put as much money at risk on new positions. It does not mean we will not take them. If they say "buy me," We will buy them.

I do not want to be accused of being a raging bull, throwing caution to the wind, and ignoring the possibilities that there could be a fall. I am acknowledging that all the way. I am also acknowledging, however, that the liquidity is staying in the market for now (thanks to Ben Bernanke and Co.) and the economic data continues to improve. With that combination, I am still willing to play the upside when the opportunity presents itself.

As always, we will take what the market gives. We are heading into earnings with a nice gain under the belt, and earnings are not necessarily being treated well. If we see stocks that are weakening, they make good setups for the downside plays. I will be more than happy to take advantage of those. At the same time, take care of your other positions. The money is rotating, and once it starts to leave, it can get a bit hairy for those stocks. Continue to take care of positions and button them up if they get in trouble. That is how we keep our gains from last year and the early part of this year. We will keep them flowing with the new positions.

Have a great weekend!


Support and Resistance

NASDAQ: Closed at 2703.17

Resistance:
2725 from July 2007 interim peak
2729 is the 127% Fibonacci extension of the August 2010 run
2735 from late 2007 interim peak
2862 is the 2007 peak

Support:
The 10 day EMA at 2683
The 18 day EMA at 2664
2593 is the November 2010 high
The 50 day EMA at 2589
2580 is the November 2010 closing high
2569 is the November gap up point through the April 2010 peak
2550 from May and June 2008 peaks
2540 is the gap up point from early November
2535.28 is the April 2010 intraday peak
2530 is the April 2010 closing peak
2518 is interim peak from April 2010
2511 is the lower range of the November gap up point
2482 is the recent October peak
2460 is the November 2010 low.
2434 is the May interim peak and the 78% Fibonacci retracement of the April selloff.
2425 is an interim peak from May 2010
2382-2395 from 2008
The 200 day SMA at 2381


S&P 500: Closed at 1271.50
Resistance:
1278 is the 127% Fibonacci extension of the August 2010 run
1313 from the August 2008 interim peak

Support:
The 10 day EMA at 1266
The 18 day EMA at 1257
1227 is the November 2010 peak
The 50 day EMA at 1226
1220 is the April 2010 peak
1185 from late September 2008
1174 is the May 2010 high, 78% Fibonacci retracement of April peak
1173 is the November 2010 low
1170 is the prior March 2010 high
1156 is the Sept 2008 low
1151 is the January 2010 peak
The 200 day SM A at 1149
1133 from a September 2008 intraday low
Bottom of the January 2010 consolidation 1131 to 1136
1129 to 1131 is the June and August 2010 peaks


Dow: Closed at 11,674.76
Resistance:
11,734 from 11-98 peak
11,867 from the August 2009 high and peak on that bounce in the selling.
11,893, from March 2008 closing low
12,110 from the March 2007 closing low
13,058 from the May 2008 peak on that bounce in the selling

Support:
The 18 day EMA at 11,574
11,452 is the November 2010 peak
The 50 day EMA at 11,367
11,258 is the April 2010 peak
11,205 is the April closing high
11,100 from the 7-08 low
10,963 is the July 2008 low
10,920 is the recent May high
The 200 day SMA at 10,759
10,730 is the January 2010 peak


Economic Calendar

These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.

January 07 - Friday
Nonfarm Payrolls, December (08:30): 103 actual versus 150K expected, 71K prior (revised from 39K)
Nonfarm Private Payrolls, December (08:30): 113K actual versus 162K expected, 79K prior (revised from 50K)
Unemployment Rate, December (08:30): 9.4 actual versus 9.7% expected, 9.8 prior (no revisions)
Hourly Earnings, December (08:30): 0.1% actual versus 0.1% expected, 0.0% prior (no revisions)
Average Workweek, December (08:30): 34.3 actual versus 34.3 expected, 34.3 prior (no revisions)
Consumer Credit, November (15:00): $1.3B actual versus -$2.5B expected, $7.0B prior (revised from $3.4B)

January 11 - Tuesday
Wholesale Inventories, November (10:00): 1.3 expected, 1.9% prior

January 12 - Wednesday
MBA Mortgage Purchas, 01/07 (07:00): +2.3% prior
Export Prices ex-ag., December (08:30): 0.8% prior
Import Prices ex-oil, December (08:30): 0.8% prior
Crude Inventories, 01/08 (10:30): -4.16M prior
Treasury Budget, December (14:00): -$91.4B prior

January 13 - Thursday
Initial Claims, 01/08 (08:30): 420K expected, 409K prior
Continuing Claims, 01/01 (08:30): 4070K expected, 4103K prior
PPI, December (08:30): 0.7% expected, 0.8% prior
Core PPI, December (08:30): 0.2% expected, 0.3% prior
Trade Balance, November (08:30): -$40.6B expected, -$38.7B prior

January 14 - Friday
CPI, December (08:30): 0.4% expected, 0.1% prior
Core CPI, December (08:30): 0.1% expected, 0.1% prior
Retail Sales, December (08:30): 0.7% expected, 0.8% prior
Retail Sales ex-auto, December (08:30): 0.6% expected, 1.2% prior
Industrial Production, December (09:15): 0.4% expected, 0.4% prior
Capacity Utilization, December (09:15): 75.5% expected, 75.2% prior
Michigan Sentiment, January (09:55): 75.0 expected, 74.5 prior
Business Inventories, November (10:00): 0.7% expected, 0.7% prior

By: Jon Johnson, Editor
Copyright 2011 | All Rights Reserved

Jon Johnson is the Editor of The Daily at InvestmentHouse.com

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