Indices Close Mixed on the Week

SUMMARY:

- A bit more expiration volume as indices close mixed on the day, mixed on the week.
- Large cap indices still holding the 50 day EMA, still in decent shape. Of course small caps and semiconductors are still in not so decent shape.
- AAPL effect? Large cap, big name leaders testing and weighing on the markets, but other stocks look solid as the big leaders make very normal tests of very strong runs.
- First week of earnings sees 85% of S&P reporting beating estimates.
- Headlines say German business sentiment helping the euro versus the dollar while the ongoing EU sovereign debt crisis said to help US bond markets. All the while European bond yields and CDS rates climb.
- French elections and their impact on France. A preview of the US?
- A fall from the highs then two weeks of lateral movement. The next move should be close to showing itself.
- Market still looks heavy as some leaders fade, but many quality stocks still on the move.
- AAPL earnings and an FOMC meeting could provide the market the information it needs, of course on top of Europe's troubles, French elections, earnings, economic data . . .

Expiration comes and goes leaving the market basically unchanged from Thursday.

The stock indices finished expiration Friday mixed, and they also finished the week mixed. SP500 and the Dow were to the upside while NASDAQ was to the downside on the day and the week. It is as if the markets did not know what to key off of for the week and on Friday. There was a bit more expiration volume. It kicked up, but there was not a lot of volatility. Looking at the intraday chart, there was a gap to the upside and then a rally through lunch that was given away in the afternoon. Rather typical expiration action, particularly when you have had some of the fireworks earlier in the week such as on Thursday.

There was better German sentiment, and that was said to bolster some of the other markets such as the euro versus the dollar. There were also earnings. MCD was in line and showing good U.S. sales. MSFT beat. ETFC beat by almost 50% as perhaps the retail investor is returning. Those numbers benefited the individual stocks, but outside of that there was not much of a coattail effect. Of course when the likes of SNDK, RVBD, and TPX all reported earnings that missed, there was a counterbalance. There is also that ever-present EU sovereign debt issue hanging there. It was said to impact the U.S. Treasury, sending them to the upside.

We have some news out of Europe that supposedly is hurting U.S. markets, and other news is supposedly helping U.S. markets. Then you have a mixed bag in the States. You get a mixed bag overall in the indices both on the week and on the session.

SP500, +0.12%; NASDAQ, -0.24%; Dow, +0.50%; SP600, +0.57%; SOX, -2.38%; NASDAQ 100, -0.4%.

Obviously the large caps were leading to the downside as the NASDAQ 100 topped the overall NASDAQ's decline.

It was a week that left the indices undecided. The large caps are still holding above the 50 day EMA, working laterally after that fall two weeks ago. The smaller caps and the SOX are struggling below the 50 day EMA after their fall. That was three weeks ago with a two-week lateral move. We had that initial decline, and we have had a two-week lateral move. No resolution yet, but there were some events that may precipitate more interesting action in the week or two ahead.


OTHER MARKETS

Dollar. 1.3215 versus 1.3122 euro. The U.S. dollar was down. The German business confidence supposedly helped the euro versus the dollar. Okay, I guess we can buy into that. The dollar did fall, but it held its lower trendline and the 200 day EMA. Very interesting. It is in quite an interesting pattern that could lead to an upside break. As with the rest of the market, it is equivocal right now, but it is setting up some support. That support has been steady. We will see if it can bounce.


Bonds. 1.96% versus 1.96% 10 year U.S. Treasury. Bonds were basically flat on the session, and the 10 year was actually flat. Bonds were higher and yields were lower on the week. That is the sovereign debt issue that was discussed on Friday in some other headlines. Some headlines were saying that the German confidence was helping the markets. Others said that the ongoing European sovereign debt crisis was hurting markets in Europe and helping some markets in the U.S. while stalling out equity markets. Even the headlines are contradictory, but of course you know that. It can even be contradictory within the same news source. There are different writers with different takes, and you are left scratching your head over a mishmash of opinions.

Bonds were up nicely on the week. There is no issue with respect to the allure of U.S. bonds thanks to the ongoing problems in Europe. We had the big jump in bonds when we had one of those weaker bond auctions in Europe a couple of weeks ago. We supposedly had better bond auctions this past week from Spain and Italy. But U.S. Treasuries are still holding their gains. Even though these bond auctions were termed successful, we saw interest rates on the continent continue to rise. As they continue to rise, we see our interest rates fall because money is being moved into U.S. Treasuries. We also see credit default swap rates on the rise in Europe. The spreads are widening, and that means risk. The market makers have to widen those spreads to hedge their bets.

In any event, bonds had a good week in the U.S., at least holding their gains from the moves higher two weeks back.


Gold. 1,643.00, +1.60. Gold was virtually flat. It continues its now rather tight lateral move. It is a trading range after the breakout and then the failure in late February. That was after the Bernanke talk where it was perceived that there would be no Quantitative Easing. This was after the Bernanke talk two weeks earlier where it was perceived that there WOULD be Quantitative Easing. The sum total was, with the FOMC minutes and Bernanke's subsequent talk, they said we may have to wait for QE3. Notice that I did not say they had scrapped plans for QE3. If you look at gold, it is just working laterally in a range and biding its time to see if the Fed will move once again.


Oil. 103.83, +1.56. Oil was up on the day. It remains in this range, but it continues to hold its bid as well. There are too many issues out there for it not to.


TECHNICAL SUMMARY

Volume. NASDAQ -3.8%, 1.89B; NYSE +17.5%, 894M. Volume was mixed, most likely due to the same thing that pumped up volume on Thursday: expiration. Of course it did not impact the market evenly. That could be good given that NASDAQ sold. You would like to see volume contract a bit if you are playing the upside. Volume was up as the SP500 (and the small caps, for that matter) posted a gain. You want to see that upside volume that shows more buyers than sellers. Again, all of this was likely just an expiration distortion, so we cannot put too much into it.


Breadth. NASDAQ +1.45:1; NYSE +1.9:1. Breadth was a yawner.


THE CHARTS

SP500. SP500 is still holding above the 50 day EMA. This is a two week lateral move over this level after the fall three weeks ago that undercut the 50 day EMA but then managed a relatively quick recovery. Higher low, putting in a higher bottom above the March low. The trend is still in place, it just looks heavy. Yes, it is over the February peak, so there is really no head and shoulders here. At least not a classic one. There is a two week lateral move over the 50 day EMA that we are still going through. It has the look of a lower high trying to set, but it has not yet.

MACD is lower, no doubt. The day to day volatility was there at the top. Up one day, down the next, up, and then back down again. It could not make the move, and consequently it fell away from the high. Now it has bounced along. It is basically the same story: Up a day, down a day, or up one day and down two days. You get the picture. But it has not broken yet. It does not look good. It looks heavy, but it has not broken. You can say that about all of the large cap indices.


DJ30. The Dow has a more classic head and shoulders trying to set up. Maybe it is a double head and shoulders. It is still above its 50 day EMA as well. It sold off sharply, hit the trendline and bounced, and then it just moved itself laterally over those past two weeks, similar to SP500. Heavy, yes. It still has the same problems. Lower MACD. This one put in a lower low versus the SP500 which put in a higher low. It has a lower MACD, a lower low. It has bounced but is below the prior peaks, and it looks to be running out of gas. You name it. Again, it has not broken down. It does not look great because some of the leaders that have pushed it higher thus far are struggling, but it is hanging in there.


NASDAQ. NASDAQ is the same story. It is holding the 50 day EMA for the past two weeks. Third test to this level after that decline off of the new post bear market highs. MACD put in a lower high here as well. It did put in a higher low, so it still has the trend in place. As with SP500, it simply is not that powerful looking. The major point is that they are holding support, and we have no follow-through to the downside. Follow through is everything. You can have patterns that look weak or you can have patterns that look great. If they can never follow through in the direction of the apparent trend, or the trend change that wants to take place, then it is as good as if it never happened.

NASDAQ is struggling, but some of its main components are struggling as well, such as AAPL. It is down to its 50 day EMA (that it perfectly normal, by the way). GOOG is falling down to its 200 day EMA. PCLN is in a modest two week decline as well. With those horsemen in a bit of trouble, it is understandable that NASDAQ will experience some downside as well. But as with its main component, AAPL, NASDAQ is still holding its 50 day EMA. It looks to be something of a periodic test of that after a nice, long run up the 10 day EMA and 20 day EMA until peaking in late March. Now it is in a 50 day EMA test. Nothing unusual about that at all, as I discussed earlier in the week.


SP600. The SP600 never made the break through their 50 day EMA. They have tried but failed. The small caps potentially have a head and shoulders setting up. As I said, those are important patterns, but a lot of times they set up and then never do anything. They dissipate and the move continues. We will see. It is up to leadership to help lead the small caps (and, indeed, the market) to the upside, even if the big leaders that led the move higher have to take a breather for awhile.


SOX. SOX struggled. It put in a lower low on this pullback, dropping 2.4%. It is still holding just above the early-March lows, so it has not really broken out of the range. It is trying. It put in a higher low and now a lower low. You could say it has put in something of a head and shoulders. It certainly looks like it wants to fill the gap from mid January. There are several gaps starting from early January on. It could easily move back and fill those. Of course, that would pressure the rest of the market to come back and test a bit more. Will they break down as the stocks make a further and deeper test? Not necessarily. We will talk more about this when we look out to the coming week. Suffice it to say that the week ended with the large cap indices holding support. They look as if they are weaker, but the selling has not been able to follow through. The growth indices the SOX and SP600 never did break back above the 50 day EMA, and they have toppish looks to them.

You have heavy looks on the large cap indices that could fall further but have not. Then you have toppish patterns on the smaller indices. They have not broken down either. It looks a lot like they are going to, but none of them have yet.


LEADERSHIP

The question we have to ask: Is this something of an "AAPL effect"? AAPL makes up a large percentage of the SP500 and the NASDAQ's movement. When AAPL fades, they fade as well. As noted, there are other large cap stocks that carry a lot of weight that are struggling after nice moves. PCLN is one. GOOG is another. Others are performing well. MSFT announced earnings and gapped to the upside. It is no slouch when it comes to it is impact on the NASDAQ either. But AAPL is huge, and as it fades it tends to impact the trade overall. We can understand that, and there is no intuitive problem with it. The thing is, there are still a lot of stocks holding up really well that can move these indices higher. Or at least that could offset what we are seeing from AAPL and friends. Of course those are big stocks, and they do sag the market when they move. It takes a lot more of the smaller stocks to fill in the gaps, but it looks to be doing so.

What do I mean? SBUX was down a bit this week after it announced its earnings, but it still looks solid. UA has put in a five-week lateral move, and then it started a break higher on Friday. PII announced good earnings and gapped higher. ISRG had blowout earnings again, gapped to the upside, and it helped move things. Of course there is the old, stodgy standby KO. It announced good earnings and gapped to the upside as well. These are not necessarily going to all lead the market higher, but they are definitely helping to offset some of the sag from the bigger names. And they are holding the indices up at that near support. There are still many other stocks that are good looking right now and can move. UA and SBUX definitely look as if they can continue. Then there is PII after its breakaway gap. It can continue as well.

We are finding stocks that look good all around the market. TITN is another one. This does not mean that they will necessarily be able to offset any heaviness in the indices. But when we put this "AAPL effect" into perspective, you can understand why the indices are fading as some of the leaders pull back. You can also understand why there are still a lot of stocks out there that look good and are moving up even though the indices are pulling back. They just do not have the market cap of AAPL and friends to move the index higher. But they are helping offset or blunt some of the impact of the moves from AAPL, CMG, PCLN, et cetera.

Is this necessarily when we look at the indices negative patterns? I went through all the reasons that they looked bad. But again, they are still holding up with no follow through. That is important. Seeing how some of the leaders are sagging and pulling things back but a lot of other stocks are still positive, that suggests that this is exactly what is going on. Thus, once AAPL and company finish their pullbacks, they will be in decent buying shape. The other stocks that have helped hold the index up by moving higher during this should likely continue to do so. Maybe we get a synergistic effect and really get something good going. Of course, as soon as I say that things will crack because there are some issues ahead. But you have to do the analysis and look at leadership and where they all stand to come up with our game plan for what the market may do and how we will react.


THE ECONOMY

French election and its ties to the US elections.

The socialist candidate in France is leading current president Sarkozy by 6% to 16% depending upon the poll. France is the second strongest economy in Europe behind Germany. Its bond yields are on the rise as are its credit default swaps rates. Its credit rating is on downgrade watch from S&P and Moody's is likely to follow. Compared to Greece, Spain and Italy, not many appear worried about France. If the socialist is elected (voting starts Sunday) and implements his policies, that will change rapidly. This is very instructive for the US for those who will take a look at history.

The socialist platform Hollande espouses? Increase government spending, increase taxes, decrease immigration. In our lifetimes (at least for most of us) we have seen firsthand the failure of socialism and communism as economic systems. Yet as happens about every thirty years or so, capitalism is blamed. Without capitalism, US capitalism, Europe would not have lasted this long. One example: the US invented the vast majority of the drugs that Europe and other parts of the world demand to receive at lower prices, forcing the US to subsidize the world's cheaper miracle drugs. Without the capitalist system where risk taking and invention are rewarded, there would be no such drugs. Another example: but for the wealth created by capitalism, Europe would have had no defense against the USSR as its socialist systems could not produce enough wealth to fund their own defense.

Keynesian economics stating that government spending will create supply and demand is simply empirically wrong. The most recent proof is quite clear, the massive spending from the 'stimulus' bill and the massive liquidity poured into the system by the Federal Reserve. If it worked we would have millions upon millions of jobs created here in the US given the massive government spending.

Yet, this economic 'recovery' is the worst since the Great Depression. Seventeen quarters out we average 2.4% GDP growth with just four quarters at 3% or better, none over 4%. The last reading of 3% (Q4 2011) and that was mostly made up of inventory buildup (inventory building is not good if sales are not growing); remove the inventory build and that GDP read was below 2%. The low end of historical US trend growth is 3%; when emerging from recessions we typically have 7% to 11% GDP growth per quarter for many quarters. Adjusting for inflation, sales and wages are not only flat, they are down. Once more we proved that massive government spending does not work, yet what do many want here: more taxing for more spending. If this worked, the USSR would be here today and an economic superpower.

France's socialist tendencies have kept its growth hobbled for decades. The French socialist candidate's 'solutions', however, are going to smash down on the accelerator and race France off the economic cliff. France cannot support its own spending; there is no way it, the second strongest European economy, can support the other countries or even help Germany stave off the Continent's economic woes given it is apparently, based on the current voter polls, set on committing economic suicide.

Cross the Atlantic to the US. What is the difference here? The only difference is our heritage of entrepreneurship and fervent individualism. That is rapidly losing its power in the face of 47% of the voting population paying no income taxes and an entitlement state where those receiving government benefits average MORE disposable income than those making the average US income. Are they going to vote to have to work for effectively less pay than they can get for not working? They are not bad people, but if you pay someone not to work, he won't work. When your education system through 3 decades of federal intervention has failed to inculcate the necessary values and norms of a free, self-governing society, what do you get? Many kids in high school do not even know why we are a separate country, that many of the reasons we revolted from England and King George are present here today in the laws and regulations promulgated by our federal government.

In my day if you had less you went out and worked hard to have more. Now you turn to the government, and not even for a job but a handout, a grant, a subsidy. Kennedy was a democrat and he reminded us we do not look at what our country can do for us but what we can do for our country. How things have changed when the entitlement society grew to equal the entrepreneur portion of our society. Tocqueville wrote of this long ago, and in this election it could all come true.

If nothing is done, the US will, on autopilot, follow France and Europe off the cliff with automatic tax increases in 2013 (Bush cuts expire), no cuts in entitlements (thus increasing our $60T entitlement burden), continued governmental corruption and waste (the latest example in the GSA scandal), and if not overturned by the Supreme Court, the complete domination of the citizenship thanks to the 2010 health care act. Of course those are just the automatic impacts; those in power will actively work to further regulate every aspect of society through executive orders and regulations promulgated by the EPA and other non-elected officials, Congress be damned. The Supreme Court will change dramatically and the recent 5-4 decision allowing us to maintain firearms outside a militia will be reversed. Again, Tocqueville warned of this, as did Ben Franklin, Ronald Reagan and many others, throughout our history. Given we do not learn from economic history, it is not surprising we did not learn this lesson either.



TO VIEW THE ECONOMY VIDEO CLICK THE FOLLOWING LINK:

Flash: http://investmenthouse1.com/ihmedia/f/eco/eco.html



THE MARKET

SENTIMENT INDICATORS

VIX: 17.44; -0.92
VXN: 20.17; -0.82
VXO: 17.54; -0.89

Put/Call Ratio (CBOE): 0.88; -0.12


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: 44.1% versus 48.4%. Fading more abruptly after bouncing to 50.5% recently. Still not excessive either way but is fading off relatively high levels from February. Off the 55+ level hit in late February. That was the highest level since April and May of 2011, the peak of the post-bear market high. 35% is the threshold level suggesting bullishness. To be seriously bearish it needs to get up to the 60% to 65% level.

Bears: 23.7% versus 21.5%. Rebounding after the surprise decline last week. Now bulls and bears are congruent in their heading, i.e. bulls lower, bears higher. Was 23.6% a month back and that was down from the 25% to 26% level it held for weeks. For 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: -7.11 points (-0.24%) to close at 3000.45
Volume: 1.891B (-3.81%)

Up Volume: 826.13M (+70.5M)
Down Volume: 1.09B (-120M)

A/D and Hi/Lo: Advancers led 1.44 to 1
Previous Session: Decliners led 1.66 to 1

New Highs: 63 (-6)
New Lows: 36 (-16)


SP500/NYSE

Stats: +1.61 points (+0.12%) to close at 1378.53
NYSE Volume: 894M (+17.48%)

Up Volume: 1.91B (+560M)
Down Volume: 1.88B (-870M)

A/D and Hi/Lo: Advancers led 1.91 to 1
Previous Session: Decliners led 1.44 to 1

New Highs: 112 (+39)
New Lows: 31 (-9)


DJ30

Stats: +65.16 points (+0.5%) to close at 13029.26
Volume DJ30: 212M shares Friday versus 140M shares Thursday.


MONDAY

With that in mind, we can look at what is coming up next week. We start with looking at the economical calendar. It is fairly full. It does not really get rolling until Tuesday. Although, over the weekend we have the French election which will be quite important in the outlook on the market overall.

We have Case/Shiller, Consumer Confidence, and New Home Sales on Tuesday. We have a triumvirate of important reports. Then on Wednesday we have Durable Goods. It is always interesting to see where they are trading. They have been volatile of late, back and forth. Then we actually have an FOMC two-day meeting that we will get the results from. We will get the next look at the psyche of the Fed. Thursday we have Initial Claims and Pending Home Sales. On Friday we have another revision of Q1 GDP. It is expected to come down somewhat along with the Michigan Sentiment final for April.

We will have Europe, the scheduled economic data, and the earnings reports as well. Thus far, earnings have been coming out pretty well. Of the SP500 stocks that reported this week, 85% have beaten the street on their results. Not bad. We will have 400 or so report this coming week. It will be very busy. We do not like earnings season for stocks that we have because it makes it very difficult to play them. We make decisions about whether we want to ride them through the results or not and how much we want to ride through. We decide if we want to take some profits, for example. Or if they are not performing well and we just do not feel good about the pattern we can close them.

We also love earnings season because, on stocks that we feel will do well and we keep some positions, they have a great run like on PII. We also can play off of the moves that result from earnings. An example again is PII. It gapped to the upside in a breakaway move. It has had a nice test. It could put in a pennant and continue to the upside. We have played those quite frequently, the continuation gaps whether up or down. They tend to make us money as we leverage more into winners that are showing positive patterns and continue to the upside. We will be looking to play stocks such as that. In other words, we will still be looking to play the upside move for several reasons I have talked about before.

There is no question we have the day to day volatility that has come into the market. It started at the peak in late March. We had gaps to the upside followed by immediate selling. That was followed by immediate buying and immediate selling. Day-to-day, things got choppier, and then the market sold off in early April. But it did not break. It has moved laterally since. Two weeks laterally with the large cap indices holding support. As noted before, MACD is lower. Some leadership is falling. It does not look that strong, but there has been no downside follow through. As noted, we think this might about the "AAPL effect" where some of the leaders that led the move to the upside are obviously pulling back but have not sold off. AAPL at the 50 day EMA just as the NASDAQ is at the 50 day EMA. Coincidence? Not really. Not when you look at the percentage of AAPL as relates to the NASDAQ.

We have this pullback and it is holding. Things do not look great, but we have other stocks that look just fine in the leadership area. While the market looks heavy and some of its leaders fade, there are many quality stocks out there that can offset at least on a temporary basis and hold the market in place. We can make money off of those. Then when stocks such as AAPL decide to move back up move its 50 day EMA, if that is going to be the case, then it will bring the market right back up.

I want to reiterate that this is a normal move. You had a long, lateral base in AAPL. We had July through December, and then a breakout. Now we have had a run of the 10 day EMA and 20 day EMA. We have had four to five bounces, and then we got the fade to the 50 day EMA. That is so normal in action. MACD put in a higher high as it was moving up. Yes, it tailed off at the end, but it has made its pullback. Now we will see if it can break to the upside.

This reminds me of PCLN, a stock that we got into awhile back. It put in a base from April into January. Just a regular trading range, and then a breakout and test. We were fortunate. We were watching it, we got into it, and it ran beautifully for us. Now PCLN is coming back to test as well. Some people say it has put in a mini head and shoulders. It has. We will see if it comes back to the 50 day EMA as well and holds that. If it does, we could very easily be moving into new positions on PCLN. Maybe on this bounce we get the run to 1000 that we have been looking for.

I do not want people coming away from this saying, "Well, Johnson is off his rocker. He is super bullish now." I am not super bullish; I am concerned about what is ahead for the market. I am concerned about what is ahead for the economy. Very concerned. But I also cannot let my feelings about what I think may be happening in the economy overall bias what I am seeing in the market. What I am seeing from AAPL and others is totally normal action, so I cannot let my gut feelings about the economy color what is going on. The economy has pulled back, and these stocks have pulled back. But the regional reports in manufacturing have not flipped negative, so I cannot say we will have a recession. Yes, ECRI says we will, and I have a lot of faith in ECRI. But I also have a lot of faith in what stock charts are telling me. If they think money will flow back in from the Fed, then they could go up.

Maybe we will find out on Tuesday that that is not the case. We will have AAPL's earnings and we will have the Fed on Wednesday. Those are some pretty powerful stories coming out in the market. If we have a negative reaction to AAPL's earnings and/or the FOMC decision and the statement, then things could get ugly. As noted, the indices are holding up at support for now. It would not take much to shove them over the edge if things got really ugly, however. Any big story can still hurt the market. But that has been the case for months upon months. We see good stocks in position as the other stocks pull back. Those other stocks that are pulling back are still not really harming themselves. I think it would be a bit much to jump to the conclusion that the market will crumble and crater from here.

I am apprehensive, but I always am. I am even more apprehensive now given the action that I see. It looks like rounded tops. We have volatility, lower MACD, some internal volatility. I am cautious as can be. But when I see good patterns and I see totally normal action in some really strong, powerful stocks that are still showing that they are strong and powerful, I am not going to automatically clam up or jump ship. We will get more information, and we will definitely see where this market is going over the next week or so. We have some major news coming. What I see now does not automatically say that we will go lower.

I hope that is clear. I have tried to make it clear over the past two nights and explain what some of the volume and volatility is that we have been seeing. I hope that you understand that, while I am cautious, I still see positives that would be positive in any market that you looked at. If you see that, you cannot ignore it, just as you cannot ignore obvious negatives as well. We are at a crossroads, yes. These stocks that are pulling back could break down, but if they can maintain their strength and their trend, they could also continue right back up. We will find out more over the next week or two. That is the way it always is. But we just have to act when the market says act. If we do that, we will be in good shape.

Have a great weekend, and I will see you next week.


Support and Resistance

NASDAQ: Closed at 3000.45

Resistance:
3042 from 5/2000 low
3026 from 10/2000 low
3134 is the March 2012 post-bear market peak
3227 is the April 2000 intraday low
3401 is the May 2000 closing low

Support:
3000 is the February 2012 post-bear market high
The 50 day EMA at 2990
2910 is the recent March 2012 low
2900 is the March 2012 low
2888 is the May 2011 peak and PRIOR post-bear market high
2879 is the July 2011 peak
2862 is the 2007 peak
2841 is the February 2011 peak
2816 is the early April 2011 peak.
2754 is the October 2011 high
The 200 day SMA at 2725
2706 to 2705 is the April 2011 low and the February 2011 and consolidation low (bottom of the trading range) 2723 to 2705 is the range of support at the bottom of the January to May trading range
2686 is the January 2011 closing low
2676 is the January 2010 low and the December 2011 peak
2645-2650ish from December 2010 consolidation
2643 is the September 2011 high
2612 is the late August 2011 peak
2603 is the March 2011 intraday low (post-Japan low)
2599 is the June 2011 low and NASDAQ
2593 is the November intraday high
2580 is the November 2010 closing high
2555 is the mid-August 2011 peak
2535 is the November island reversal gap point
2441 is the November 2011 low


S&P 500: Closed at 1378.53

Resistance:
1378 is the February 2012 peak
1422.38 is the Post-bear market high (March 2012)
1425 from May 2008 closing highs
1433 from August 2007 closing lows
1440 from November 2007 closing lows

Support:
1371 is the May 2011 peak, the post-bear market high
The 50 day EMA at 1371
1357 is the July 2011 peak
1344 is the February 2011 peak
1340 is the early April 2011 peak
1332 is the early March 2011 peak
1318.51 is the May 2011 low
1295 to 1294 is the April 2011 low and the February 2011 consolidation low (bottom of the trading range)
1293 is the October 2011 peak
1275 is the January 2010 low, early January 2011 peak
The 200 day SMA at 1273
1267 is the December 2011 peak
1258 is June 2011 intraday low
1255 is the late December 2010 consolidation range
1249 is the March 2011 low (post-Japan)
1235 is the mid-December 2010 consolidation low
1231 is the late August 2011 peak
1227 is the November 2010 peak
1220 is the April 2010 peak
1209 is the mid-August 2011 high
1196 is the November 2010 consolidation peak
1178-1180 is the October 2010/November 2010 consolidation low
1158 is the November 2011 low
1131 - 1127 from August 2010 base peak.
1119 is the early August closing low
1109 is the mid-September 2010 gap up point
1101 is the August 2011 low
1099 from the mid-July interim peak
1075 is the October 2011 intraday low


Dow: Closed at 13,029.26
Resistance:
13,056 is the February 2012 high
13,058 from the May 2008 peak on that bounce in the selling
13,297 is the April 2012, post bear market high
13,668 from 12-2007 peak
13,692 from 6-2007 peak
14,022 from 7-07 peak


Support:
The 50 day EMA at 12,940
12,876 is the May high
12,754 is the July intraday peak
12,391 is the February 2011 peak
12,284 is the October 2011 peak
12,258 is the December 2011 peak
The 200 day SMA at 12,147
12,110 from the March 2007 closing low
12,094 is the April 2011 low
The June low at 11,897 (closing)
11,734 from 11-98 peak
11,717 is the late August 2011 peak
The August low at 11,702
11,555 is the March low
11,452 is the November 2010 peak
11,178 from November 2010
10,978 is the bottom of the November 2010 consolidation
10,750 from September 2010
10,720 is the August closing low
10,705-710 from January 2010 peak
10,694-700 from August 2010 peak


Economic Calendar

April 16 - Monday
Retail Sales, March (8:30): 0.8% actual versus 0.3% expected, 1.0% prior (revised from 1.1%)
Retail Sales ex-auto, March (8:30): 0.8% actual versus 0.6% expected, 0.9% prior
Empire Manufacturing, April (8:30): 6.6 actual versus 17.5 expected, 20.2 prior
Net Long-Term TIC Fl, February (9:00): $10.1B actual versus $102.4B prior (revised from $101.0B)
Business Inventories, February (10:00): 0.6% actual versus 0.5% expected, 0.8% prior (revised from 0.7%)
NAHB Housing Market Index, April (10:00): 25 actual versus 29 expected, 28 prior

April 17 - Tuesday
Housing Starts, March (8:30): 654K actual versus 700K expected, 694K prior (revised from 698K)
Building Permits, March (8:30): 747K actual versus 710K expected, 715K prior (revised from 717K)
Industrial Production, March (9:15): 0.0% actual versus 0.2% expected, 0.0% prior
Capacity Utilization, March (9:15): 78.6% actual versus 78.5% expected, 78.7% prior (revised from 78.4%)

April 18 - Wednesday
MBA Mortgage Index, 04/14 (7:00): 6.9% actual versus -2.4% prior
Crude Inventories, 04/14 (10:30): 3.856M actual versus 2.791M prior

April 19 - Thursday
Initial Claims, 04/14 (8:30): 386K actual versus 375K expected, 388K prior (revised from 380K)
Continuing Claims, 04/07 (8:30): 3297K actual versus 3275K expected, 3271K prior (revised from 3251K)
Existing Home Sales, March (10:00): 4.48M actual versus 4.62M expected, 4.60M prior (revised from 4.59M)
Philadelphia Fed, April (10:00): 8.5 actual versus 10.3 expected, 12.5 prior
Leading Indicators, March (10:00): 0.3% actual versus 0.2% expected, 0.7% prior



April 24 - Tuesday
Case-Shiller 20-city, February (9:00): -3.4% expected, -3.8% prior
Consumer Confidence, April (10:00): 69.5 expected, 70.2 prior
New Home Sales, March (10:00): 320K expected, 313K prior
FHFA Housing Price Index, February (10:00): 0.0% prior

April 25 - Wednesday
MBA Mortgage Index, 04/21 (7:00): 6.9% prior
Durable Goods Orders, March (8:30): -1.9% expected, 2.4% prior (revised from 2.2%)
Durable Goods -ex Transports, March (8:30): 0.5% expected, 1.8% prior (revised from 1.6%)
Crude Inventories, 04/21 (10:30): 3.856M prior
FOMC Rate Decision, April (24:30): 0.25% expected, 0.25% prior

April 26 - Thursday
Initial Claims, 04/21 (8:30): 373K expected, 386K prior
Continuing Claims, 04/14 (8:30): 3300K expected, 3297K prior
Pending Home Sales, March (10:00): 0.5% expected, -0.5% prior

April 27 - Friday
GDP-Adv., Q1 (8:30): 2.6% expected, 3.0% prior
Chain Deflator-Adv., Q1 (8:30): 2.2% expected, 0.9% prior
Employment Cost Index, Q1 (8:30): 0.5% expected, 0.4% prior
Michigan Sentiment - Final, April (9:55): 75.7 expected, 75.7 prior

By: Jon Johnson, Editor
Copyright 2012 | All Rights Reserved

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

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