Market Rallies in the Afternoon

SUMMARY:
- Market a bit hung over, but stumbles along and then rallies in the afternoon on EU stress tests.
- Indices post a higher high, starting the breakout from their inverted head and shoulders.
- EU economic data improves, bolsters US rally despite some weaker earnings reports on Friday.
- Leaders keep setting up and breaking higher, providing the upside impetus.
- Looking for a move to the January peaks and then an important test.

Stocks stumble around after Thursday rally, but then focus after EU stress tests.

The US stock market was a bit hungover on Friday after posting very nice 2%+ gains on Thursday. There is often a little softness in the morning after nice gains, and it was aided by earnings reports that were less than spectacular. AMZN missed by $0.09. MCD beat expectations, but its sales were not as anticipated. MCD suffers the fate of a very successful company that for many quarters has easily topped expectations, growing sales all around the globe. When it was unable to do that this quarter, the market did not treat it kindly. Welcome to the world of NFLX. That is what happened to it on Thursday after several quarters of stomping expectations. It could not stomp them as hard, and it was taken to the cleaners.

It is not that the news was bad; there was actual good news out of Europe. German business confidence was higher than expected indeed, it hit a three-year high. The UK GDP came in at 1.1%. That is not much, but when the expectations were for crap, two times crap is pretty good. This was double is expectations and, consequently, European markets were up. They were up but then started to stumble right before the close. The European stress tests came out after the market closed, and there was a bit of trepidation ahead of the weekend as to what these might show.

US stock futures were down, and they opened the market lower. Looking at the intraday chart, there was a gap lower on the SP500, and it just chopped around. It did manage to move back up to the positive level, but by lunch time, stocks on the SP500 were flat, NASDAQ was lower, and the US markets were generally mixed. They were chopping around, and the question was whether it would be another Captain Ron session where the markets stumble into good fortune, or if it would be more of the up and down trade we have seen for the last couple of months while the US market is basing.

As it turns out, we got Captain Ron once more. He showed up just after lunch when the EU stress tests came out. Out of 91 banks, only 7 of them failed the test. Not many people believed this was an accurate read of the strength and health of the EU banks. Many feel it was a preordained outcome. They threw some of the banks to the dogs one even from Germany but overall they passed when things were not considered that good. After all, we were close to another financial meltdown just a few short months ago.

Whether preordained or not, the market was ready to believe. It wants to believe, and that has been the theme of the market over the past few weeks. It wants to believe things are better, and thus there was the improbable rally that stocks enjoyed after breaking to new 2010 lows. They reversed on what was a false breakdown and rallied. They tested and now have made a higher low and are breaking to a higher high. That is the first step in recovery. It is a long process, but it is the first step. The next step will be taking out the last high before the lower low. That will be much more interesting because that puts the SP500 back up to the January 2010 range. I am getting a bit ahead of myself.

There was a definite Captain-Ron atmosphere in the market, and stocks surged higher into the afternoon, and then they started to chop back and forth. They even tried to sell off in the last hour, but rebounded in the last 15 minutes to close near session highs. NASDAQ +1%, the Dow +1%, SP500 +0.82, SOX +0.5, SP600 +2.1%, NASDAQ 100 +0.66%. NASDAQ 100 had to carry the likes of NFLX and AMZN on its back. When they were down, that is not an easy thing to do. They all finished positive as the Captain Ron, happy-go-lucky stock market continued to move higher. Granted it got the help from earnings most of the week. IBM disappointed, but almost everyone else came through in the clutch. There were outstanding results. Even with a couple of disappointments from some stalwarts of late (namely SNDK, NFLX, and IBM) stock are overall reporting outstanding earnings and, more importantly, excellent guidance. They have plenty of money, but they are just not spending any of it except amongst themselves. I guess that will have to do for now. It is definitely enough to keep the stock market going as it tries to fight its way back up through all of this resistance. So far there was a higher low, a higher high, and still on track to continue to the upside.


OTHER MARKETS.

The other markets more or less continued their recent trends.

Dollar. The dollar was stumbling around once more (1.2914 Euros versus 1.27887 Thursday). Of course it was lower: US earnings were not great to start with, and the EU had good news with the UK and German business confidence. The dollar was lower, although not cataclysmically. The problem with the dollar is that it broke the 2009 trendline, kissed it, and it is falling back. It is in jeopardy of coming back down to the February and March-through-mid-April consolidation. It very easily could drop there. I am not expecting the dollar to rise anytime soon, although I am not expecting any kind of cataclysmic decline.

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Bonds. Bonds took a hit for the second day in a row. Wednesday they were in breakout mode. The stock market was down, and bonds were surging to a new closing high for 2010. That did not last very long; they reversed and started to sell (10 year US Treasury 2.99% versus 2.93% yield Thursday). It was not too long ago they were even higher, so this is still decent and low pricing, but there appears to be an attempt to sell bonds now. That would make sense. With the European economy looking stronger, there is not much need to run to the safety of US bonds. If that means more success for the US economy, then that means there are less US investors putting money in bonds as well. There is a bit of a double top over the past four weeks. We will have so see how far that pushes bonds. The important level is marked by the white horizontal line that runs roughly through the July low. There are some price peaks and closes you can see several of them. Tests along the way. The line goes way back in time, and it is an important one. We will see how it holds. That is the next important test for bonds, and it is being bolstered by a rising 50 day EMA. If it breaks this level with all of these support points, it will be a significant and important move in that bonds are heading lower.


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Gold. Gold has been under pressure, and it continued under pressure. It rallied all the way to the 50 day EMA on the Friday high and reversed to close down ($1,188.50, -7.10). It is starting what looks to be a continuing downtrend towards the 200 day EMA. That just so happens to be at the January 2010 and the March 2010 peaks as well. There are important price highs and lows, and now the 200 day EMA there. That looks to be the next test level. It could pull up around 1155. It is going down to this range from the looks of it. That is why I am still looking for a GLD play to the downside after this test. We would get it and have a nice gain as it drops.

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Oil. There is a storm ready to come across Florida and head into the Gulf. It looks like oil has hit an important level itself, rising up to the June twin peaks. Looking back to March, this is a level where oil tested and held as it rallied to highs in its range. Now it is back at this midpoint in this range, and it is testing this area. There was a big burst on Thursday when the storm formed, and now we will see if it pushes on through. If it does not, this will be significant with the storm out there. Granted it is not a huge storm and is not expected to get very strong. Nonetheless, if it does not move up with the storm, that does not say much for oil's prospects of going much higher or at least breaking out of its longer-term range.

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TECHNICAL PICTURE

INTERNALS

Volume. Volume was not bad at all, rising almost 2.4B shares on NASDAQ. That moved it a bit further above average. Thursday was a rising volume day and so was Friday. Not bad action. NYSE volume continues to languish well below average. It struggled to get just over 1B shares, but it did do it for what that is worth. It is still quite weak, so you cannot put a lot of credence into this move. Techs do look a bit better. Some of that tech volume was downside volume. There were issues with some tech stocks, and that pushed volume higher as they sold. Do not take too much solace in the fact that volume was up on Friday.

Breadth. Breadth was not bad at 3.4:1 on NASDAQ and 3.7:1 on the NYSE. Very solid with the small caps leading the move. You would expect breadth to be broad and it was. There is still the same pattern: On days when the market moves, the breadth is either strongly positive or strongly negative while volume remains equivocal at best.


CHARTS

SP500. The SP500 broke to a higher high on this move, although it really needs to get through the June peak. It is coincident with other areas of support and resistance. I am looking back to the February dip, back to the gap point from May, and then some peaks in June as well. It is in an area where there is resistance, but there will be resistance on the entire move upside because the whole area represents overhead supply. The key area is going to be the January peak range, again marked by these two white lines. That will be where we watch the next test the 200 day EMA. Then there is this range of resistance at 1,115 followed by the important January peak range.

NASDAQ. NASDAQ also made a higher high on this move after the higher low. It cleared the 200 day EMA already. Not a bad move. It, too, has to deal with the January high. It is shooting down each higher resistance as it comes up to it. It still has the major work to do where it also rallied into mid June and bumped its head hard and stumbled to a new 2010 low. With that in mind, we have to keep a close eye as NASDAQ makes the move to that point. As with the SP500, there is that reverse head and shoulders working, and it looks to be trying to break out now. Remember, there was the six month head and shoulders on both NASDAQ and the SP500 that was consummated (some said) with this breakdown in July to new 2010 lows. Then it reversed, and now the market is rallying again. How many times have you seen that happen? The moral of that story is not to put too much faith in head and shoulders patterns. Inverted head and shoulders patterns can be cool; I like them when they form after a long selloff, and that is what we are seeing now.

SP600. You can see it on SP600 as well. It broke through the 50 day EMA and through its recent peak. Similarly to the other indices, it has made a higher low and a higher high. It also still has the lion's share of its work ahead of it, as it has to deal with the March consolidation. That is also roughly where it bounced up in late May, early June, and mid June. That will be the critical level for the small caps, but they are roaring back right now, reversing a trend and rallying higher. They never did hit a lower low for 2010 in the July selloff.

SOX. Semiconductors have been a leader the entire way. The SOX is still performing well, although it was a bit disappointing on Friday. There were issues with SNDK. It was one of the market leaders to the upside that just did not produce good earnings and was being sold off. That hampered the semiconductors. Still, they have made a higher low at the 200 day EMA. They just have not made a higher high yet over the earlier July peak. There is a serious level coming up for the semiconductors as well. There is a band resistance, and it just crossed into it on Friday.


LEADERSHIP

Financial. JPM is trying to set up and break higher as well. A nice rally and a gap. It filled the gap after earnings, and it is now rallying back to the upside. Not a lot of volume yet, but it is still not bad. It put in a higher high, a higher low, and now it is trying to break to the upside. The 50 day EMA will be the next resistance. There is a bit of price resistance there, but it has plenty of room to the upside. GS is interesting; it pulled back to end the week. There were questions about the settlement it had with the SEC, but note how it tapped the 10 day EMA, and it also tapped the high from early June. It bounced up on Friday, and it is an excellent pullback. It looks primed to make a rally back up to this next resistance point which is right now coincident with the 200 day EMA. That will be serious resistance, but it is also a very nice run to that point.

Technology. AAPL was up modestly after gapping lower on Friday. It is having problems issuing the white iPhone. Apparently it yellows and needs to get the kinks worked out, but AAPL is still banging around in its range. It has not sold off, but it is just doing a range trade after a strong run, trading up and down. That is not necessarily a bad thing. If it can consolidate in a trading range while holding these gains and makes a higher low, it may break out to the upside of the range. Always watch for the higher lows at a key support level it can lead to a breakout. FFIV reported great earnings, screaming to the upside with another 4.5% gain. Even GOOG is getting in on the mix. It is trying to set up its own inverted head and shoulders and trying to break to the upside as well. AKAM looked like its goose may have been cooked, but it managed to make a higher low. Now it is making a higher high and trying to return to the upside; indeed, it broke into its uptrend line. It is back in its channel, and we will see if it can continue on in this channel as the strong get stronger. EMC had a great surge and broke out to a higher rally high. It tested that, and came right back to sit on top of that mid-June peak and then bounced higher. It does not pay in the market to take photographs.

Semiconductors. ALTR broke to a new rally closing high on Friday and is looking great. Very nice test, surging back up. XLNX was the same action. It broke to a new rally high, tested it over a week, and then Thursday and Friday it was off to the races once more. SWKS blasted off to a new rally high on excellent volume. Outstanding action.

Industrial. CAT continues to move higher, almost a 2% gain. Industrials are looking solid. CMI broke out of its triangle and is moving to a new rally high. JOYG is exploding higher. It made not only a higher low, but a higher high as well. Excellent action from industrial stocks.

Metals. Metals are also enjoying gains. AKS cleared the 50 day EMA on Thursday. It continued higher on Friday on rising average volume, putting in an almost 3.25% move. FCX is doing the same: Surging higher, making a higher high. Although volume did trail off, it is still solid trade.

Retail. GES cracked its 50 day EMA on Thursday and exploded through it on higher volume on Friday. Excellent reversal. Here is the selloff, and here is the inverted head and shoulders. The left shoulder in June, the head to start July, and the right shoulder over the past week and a half. Exploding higher Thursday and Friday. BBBY made a higher high as well off this double bottom. I do not know if I am ready to get into this one. It has a lot of gaps, and there is serious resistance from February. I would like to see it form a handle here, fade back slightly, and then start to surge. That is when I would want to move in on this one. LOW had a nice move on the week. It has a double bottom set up on its own. It is at the hump now at the double bottom. I want to see what happens. I would like to see it fade back a bit, hold right on top of the peaks in the first bottom and then make the break to the upside. That would be your buy point. TJX looks to be setting up again after looking pretty ugly a week ago. It has now double bottomed at the 200 day EMA and it is starting back to the upside. I would like to see more volume here and see how that plays out. It might turn into an interesting play.

As you can see, there are many stocks that have sold off, and there are many stocks that have formed rounded bottoms, double bottoms, or inverted head and shoulders patterns. They are starting to make the move higher as money flows back into them. A lot of these were retail stocks, metal stocks, and industrial stocks that sold off after leading the market higher. Now they have based out. They have put in those patterns and are breaking to the upside.

We have been picking them up as they have been moving. We are doing the best we can you cannot catch them all. Some of them gapped away from us, and you have to wait until they come back. That is all you can do. You can only buy so many, but you can try to get as many of the good ones as possible. We have been and enjoying the fruits of those, and actually taking gains this week on stocks we bought as they started to come out of off their lows. As the market continues higher as it looks like this Captain Ron, happy-go-lucky stumble higher is going to do we will continue to take more gain off the table.

The market indices are approaching the next resistance point. Once they get out of this range and it looks as if they are doing that right now they are going to move back up toward the January peak range. That will be the important point where it will test. If they stall there, we will be happy anyway because we will have logged great gain and will be banking it. If they stall, we will bank the gain and see what happens. If they do not, that is great. We will let our positions run and look for more upside just as we have been doing all along.

Remember, breaks higher come in waves. When stocks have time to base and move higher in this choppy manner, that gives them time to work on their patterns, develop some strength, and then break higher. We see them come out in waves, and leaders are breaking out in waves. That is why we are able to buy well into the move. We buy with caution, of course, because the move had not proved itself. It could still turn over on us, but it is making higher lows and higher highs. It keeps finding a way to move upside, even when there was bad news as there was this week. The market reacted very positively to some bad news. Of course it did get good news that gave it a good kick in the pants to the upside anyway. The fact that it was able to move on good news and then hold the line on bad news and continue higher is very positive.


THE MARKET

MARKET SENTIMENT

VIX. There were a series of lower highs from the VIX after it spiked in May during the flash crash and subsequent test lower. In June and early July, I noted that when the market made the new low in the new 2010 lows, VIX did not make new highs. I suggested at the time and I felt strongly about it that that indicated the market would have an oversold bounce and we would have to see how it performed from there. Now volatility is back down to the 200 day EMA. It held there and then bounced when the market sold off on the first test of its oversold bounce, but it rebounded. After a rebound it sold back to the 200 day EMA after this last run. Now it has not broken down even though the market has broken to a higher high.

Looking at the SP500, the high in this selloff is where volatility bounced back up. Now the market is breaking back through that high, but the volatility is still holding at the 200 day EMA. Looking back to mid June, that is when volatility hit the 200 day EMA. There was a higher high in June, and there is a lower high now. Is that suggesting this move is over? After all, there was a higher high at this same level, and here we have a lower high. Actually, I think this suggests that volatility is going to break lower and the market is going to run higher.

VIX: 23.47; -1.16
VXN: 24.16; -1.06
VXO: 23.33; -0.94

Put/Call Ratio (CBOE): 0.84; +0.02

Bulls versus Bears:

After a crossover, a tie. Two weeks back the bulls/bears reading showed a rare crossover, typically a bullish indication. The market continues to perform decently to the upside. This past week they were tied, still a bullish indication.

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 doesn't have the cash to drive it higher.

Bulls: 35.6%. Up from 32.6% that was a reading below the bears for that same week. Still tied with the bears and that is still a bullish indication. Down from 56.0% on this leg's high. This move started at a low of 35.6% in February, the lowest it has been since July 2009. 35% is the threshold level suggesting bullishness. After peaking at 53 on this move the bulls lost some nerve, falling to a new low post- July 2009. Once again bulls peaked out near the 50% level. Bulls have bumped at 50ish since late August 2009, falling to 45ish and then rebounding. Hit a high of 47.7% mid-June on the run from the March lows. Again, to be seriously bearish it needs to get up to the 60% to 65% level.

Bears: 35.6%. Up from 34.8% where it stayed for two weeks and for a crossover with the bulls. Solid rise from the mid to upper 20's. Fell to 18.7% on the low. Hit a high of 27.8% level on the prior leg in February. Over 35% is considered bullish for the market; definitely at the lower end of the scale. Peaked near 28% in November, falling short of the 35.6% hit in July 2009. For reference, cracking above the 35% threshold considered bullish. Hit a high on this run at 47.2%. 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: +23.58 points (+1.05%) to close at 2269.47
Volume: 2.37B (+10.01%)

Up Volume: 1.667B (-317.642M)
Down Volume: 719.61M (+435.348M)

A/D and Hi/Lo: Advancers led 3.41 to 1
Previous Session: Advancers led 4.93 to 1

New Highs: 78 (+39)
New Lows: 40 (+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: +8.99 points (+0.82%) to close at 1102.66
NYSE Volume: 1.15B (-2.26%)

Up Volume: 911.087M (-155.763M)
Down Volume: 229.759M (+122.374M)

A/D and Hi/Lo: Advancers led 3.71 to 1
Previous Session: Advancers led 5.71 to 1

New Highs: 220 (-12)
New Lows: 38 (-5)

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

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


DJ30

Stats: +102.32 points (+0.99%) to close at 10424.62
Volume DJ30: 200M shares Friday versus 171M Thursday.

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


MONDAY

There is a full week of action ahead. We will have the new home sales following the rather disappointing existing home sales. They were better than expected, so the market reacted positively, but they are still atrocious and not getting any better. There is the Case-Shiller 20-city index. It will tell us about how bad prices are. Then there will be some consumer confidence and ending out the week with Michigan Sentiment. They are at recession levels, and I do not expect them to get much better. Durable goods orders are always interesting because businesses have more money than the individuals they are just not spending it. Initial jobless claims are expected to be crappy again. GDP advance for Q2, etc. We are going to have a full slate of data in addition to more earnings.

The market is looking solid. It is making higher lows and higher highs, moving to the upside. We are also well into earnings season. We are over halfway there, and we have seen a lot of results. There have been mostly good results and some bad. The market is reacting positively to the upside. Often the stock market will react one way as earnings start, and then it has a problem after that in keeping the same move going (particularly if it is to the upside). We are having a summer rally. It does not look like it after the selloff ahead of this bounce, but we are having a rally. That typically means it will rally into August. Notice that techs do well at this time of year, but then everything slumps in September into October. I still expect to get more upside. I do not think we will necessarily have that turn back down after we get midway through earnings. There was a huge selloff moving into earnings, and now we are seeing things are not nearly as bad as the selloff would have indicated. Stocks are recovering and moving well.

Leadership is setting up and continues to move to the upside. It is coming in waves, and we have been buying those. I expect to market to continue higher. It does not mean it is clear sailing not at all. There will be choppy action. It is still in a base, going up and down. Huge moves downside, big moves upside. The result is it has not gone much of anywhere over the past two months, but that is part of the basing process.

What I expect is a rally up to this January peak (or somewhere in the range of January). Then I expect more basing activity. That would break it out of this inverted head and shoulders, it would rally, and then it would most likely test that breakout. That is normal. People will freak out at that point, but we will take gain at that point as it hits that level and stalls out. That is our plan. There are initial targets that we will keep and honor as the stock market moves higher. We bank money along the way, and we are never crushed when it turns or starts to head back down. I expect it to test after it gets to this level, and we will have to reevaluate at that point. Has the data changed? Are there any warnings? What is going on generally in the world? If it comes back and tests normally, a pullback to the 200 day EMA would make a lot of sense. It bounces up to this level in January, sells back to the 200 day EMA, makes another higher low after a higher high, and then it breaks out over a key level. That is what I anticipate will happen. That is, if we continue to get the same kind of news out of the EU and get decent economic data in the US.

There is a belief now that China may be able to engineer something of a soft landing. I will believe it when I see it. India is still strong and Brazil remains strong. There are the other companies of the BRIC that are able to keep things moving. Thus we are seeing those stocks such as CAT and its industrial brethren doing better. The commodities stocks metals, lumber, etc. that you need to build things, they are moving up again. They were the leaders in 2007-2009, and they had a hard time after the world came tumbling down. They were the ones moving up crazily, and now they have come crashing down. They have had their test and are moving back up now that things appear to be recovering and are not as bad as many had feared. LIBOR has turned down to 0.49%. It was up to 0.55%, and it has been steadily ticking down over the past couple of weeks.

There is a much better outlook of things to come, thus I anticipate the market will continue to try to build back to the upside. But it is never a straight line. After this rally to a new higher high, we may get softness to start the week. That is okay because there are positions that we were unable to get into that I would like a shot at. If they pull back a bit, we can get into them. I will be looking for others as well while they make the move to the upside and towards this January peak. That will be the next critical point. If we get there, we will have bank made and we will be banking a lot of gain on the positions we have been taking ever since the market made this reversal off of the lower low for 2010. That is the old false breakdown. We were ready for it, and we started moving in as it made the move up and have been reaping some nice reward on the way back up. We will continue to do that as it moves up toward the January peak. Have an excellent weekend.


Support and Resistance

NASDAQ: Closed at 2,245.89

Resistance:
2245 from July 2008 through 2260 from late 2005.
The 200 day SMA at 2259
2275 - 2278 from the February 2008 and April 2008 lows
2273 to 2282 marks bottom of January 2010 lateral peak
2292 is a low from January 2008
2319 from the September 2008 peak
2320 to 2326.28 is the January 2010 high
2324-2370 is a range of resistance from early 2008
2382-2395 from 2008

Support:
The 50 day EMA at 2242
2221 is the gap down upside point from June.
2205 is the November 2009 peak 2210 (from September 2008) to 2212 (the July 2009 closing low)
2185 to 2195 represent support points for years: December 2004 peak, July to October 2005 consolidation, January, March and July 2008 lows, and October 2009 peak.
2184 is the June gap bottom side.
2177 is a low from March 2008
2169 is the March 2008 closing low (double bottom)
2168 is the September 2009, intraday peak
2167 from the July 2008 intraday low
2155 is the March 2008 intraday low
2100 is the February 2010 low
2024 from November 2009
2020 to 2005 from the Q4 2009 peaks


S&P 500: Closed at 1102.66
Resistance:
1106 is the September 2008 low
The 200 day SMA at 1113
1114 is the November 2009 peak
1119 is the early December intraday high
Bottom of the January 2010 consolidation 1131 to 1136
1133 from a September 2008 intraday low
1151 is the January 2010 peak
1156 is the Sept 2008 low
1170 is the prior March 2010 high
1174 is the May 2010 high
1181 is the April selloff low
1185 from late September 2008

Support:

1101 is the October 2009 high and the recent May and June 2010 interim peaks
The 50 day EMA at 1091
1084 to 1080 (September 2009 peak)
1078 is the October range low
1070 is the late September 2009 peak as well as several other peaks and valleys even in 2010
1044 is the October 2008 intraday high AND the February 2010 low
1040 is the May 2010 low
1020 is the bottom of the late summer 2009 consolidation
946 from June 2009


Dow: Closed at 10,424.64
Resistance:
10,365 is the late September 2008 low
The 200 day SMA at 10,395
10,496 is the November 2009 high
10,594 is the June 2010 peak
10,609 from the Mid-September 2008 interim low
10,730 is the January 2010 peak
10,920 is the recent May high
10,963 is the July 2008 low
11,100 from the 7-08 low
11,205 is the April closing high
11,734 from 11-98 peak

Support:
10,285 is the late December consolidation peak
The 50 day EMA at 10,262
10,260 from the May and June 2010 interim peaks
10,120 is the October 2009 peak
9829 is the September 2008 closing high
9918 is the September 2008 peak
9855 is the early September peak in its lateral range
9835 is the late September 2009 peak AND the February 2010 low
9774 is the May 2010 intraday low
9325 is a late 2008 interim peak
9034 from early 2009 peaks


Economic Calendar

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

July 19 - Monday
National Homebuilder, July (10:00): 14 actual versus 16 prior (revised from 17)

July 20 - Tuesday
Building Permits, June (08:30): 586K actual versus 572K expected, 574K prior
Housing Starts, June (08:30): 549K actual versus 575K expected, 578K prior (revised from 593K)

July 21 - Wednesday
Crude Inventories, 07/17 (10:30): 0.360M actual versus -5.06M prior

July 22 - Thursday
Initial Claims, 07/17 (08:30): 464K actual versus 445K expected, 427K prior (revised from 429K)
Continuing Claims, 07/10 (08:30): 4487K actual versus 4600K expected, 4710K prior (revised from 4681K)
Existing Home Sales, June (10:00): 5.37M actual versus 5.09M expected, 5.66M prior
Leading Indicators, June (10:00): -0.4% expected, 0.4% prior

July 26 - Monday
New Home Sales, June (10:00): 310K expected, 300K prior

July 27 - Tuesday
Case-Shiller 20-city, May (09:00): 4.0% expected, 3.81% prior
Consumer Confidence, July (10:00): 51.0 expected, 52.9 prior

July 28 - Wednesday
Durable Orders, June (08:30): 1.0% expected, -0.6% prior
Durable Orders ex Tr, June (08:30): 0.5% expected, 1.6% prior
Crude Inventories, 07/24 (10:30): 0.360M prior

July 29 - Thursday
Initial Claims, 07/24 (08:30): 464K expected, 464K prior
Continuing Claims, 07/17 (08:30): 4550K expected, 4487K prior

July 30 - Friday
GDP-Adv., Q2 (08:30): 2.5% expected, 2.7% prior
Chain Deflator-Adv., Q2 (08:30): 1.1% expected, 1.1% prior
Employment Cost Index, Q2 (08:30): 0.5% expected, 0.6% prior
Chicago PMI, July (09:45): 56.5 expected, 59.1 prior
University Michigan Sentiment, July (09:55): 67.5 expected, 66.5 prior

By: Jon Johnson, Editor
Copyright 2010 | All Rights Reserved

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

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