NASDAQ Pushes Past January High

SUMMARY:
- Muddled jobs report and still the market rises.
- NASDAQ pushes past January high, SOX surges, leaving the small caps odd man out.
- Unemployment rate dives and so do non-farm jobs. Things are better, things are worse, but you have to assume overall improvement, right?
- Oh Canada. Four times more jobs than expected.
- Bonds diving as the problem that was holding it in its range likely won't topple the recovery.
- Dollar recovering, but a long way to go to credibility.
- Irrepressible stock market continues to push higher, fueled by the Fed's liquidity supertanker.
- Retail, tech coming back around, starting to lead once more.

MARKET OVERVIEW

Jobs report snow job leaves market without the clear signal we wanted.

A muddled jobs report left us without the clear signal we wanted to see on the day. That is typically the way of the market; you think something has to show up and it does not. The market does what it will do, and it does it on its own time.

The jobs report was muddled. Unemployment fell to 9%. That makes the two-month decline from 9.8% to 9% the best in 60 years. But (and this is a big but) when there is such a decline, historically there is an accompaniment of a large number of jobs non-farm, private, you name it. We are not seeing that. The non-farm payrolls only rose 36K versus 148K expected. The private jobs only rose 50K versus 163K expected. Who can you trust? The market did not know what to do. At first it meandered around in the premarket. It was negative, but then it reversed and started to the upside. It continued to move higher most of the day. There was a mid-morning dip, as there frequently is, but it reversed, rallied, and the indices closed out near their session highs.

NASDAQ was finally able to take out its January peak. It shaved it by a gnat's butt, as we like to say around here. It did take it out, and thus it joined SP500 with a move above its prior peaks. The SOX was already there. It decided it would avoid the Christmas rush and surge up by itself, and it was rocking and rolling on Friday. That leaves the SP600 small caps by themselves, having not taken out the prior peaks in this trading range. Even the mid caps posted a new rally high on Friday. That leaves you wondering about the small caps and about the rally. Then again, maybe it is just that point in the economic move where the stock market starts to trend out of small cap growth and into the more staid and steady. That could be. There was a resumption in the move in technology as NASDAQ broke higher, and retail stocks started to move back up.

That is the theme to end the week. Some downtrodden techs reversed and started to rally, and retail that was down reversed and started rallying as well.


OTHER MARKETS

Dollar: The dollar is acting as if there is an economic recovery underway after imploding early in the weak indeed, over the past month in a sharp selloff from its trading range. The dollar was up again on Friday, and it is try to make things look respectable after the plunge from the June peak (1.3582 Euro versus 1.3633 Thursday). Improvement, but it is way off from where it was just in the summer.

There is economic improvement, but the dollar is not acting as though it is a major economic recovery. I have been talking about that all along. It is a recovery. You can't throw this kind of money at anything without getting some kind of asset price appreciation, but that is all it has been for the most part. Markets have shown a price appreciation while jobs have not followed. Those paper assets. What is Gordon Liddy always talking about? Gold! I am not necessarily advocating gold, but there is a difference between paper assets versus real things. I digress, but you understand why I am prone to wander off the straight and narrow in these times.

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Bonds: Bonds are really acting as if something is improving economically. The 10 year tanked (3.64% versus 3.55% Thursday). Over the week, the 10 year gained 32BP as the bond itself tumbled in value. I am looking at the trading range in December and January where the bond market tried to hold up. The reason was because something was brewing out there. There was a storm ahead, but it was not necessarily the storm that the bond market was worried about. Maybe it was just uncertain. If the bond market had really been worried, it would have taken off to the upside. As it was, it was just moving laterally.

Something was wrong, but it was not sure exactly what. When it was Egypt, it tried to bounce back up when that news came out, but apparently it has become comfortable with what is going on in the Middle East. It does not anticipate any major collapses in Saudi Arabia or any other countries. Bonds have started to sell as they should have probably been doing all along given the improvement in the economic data over the past couple of months.

Bonds broke lower, and it looks like they will head lower still before anything happens that would turn them back up. Even Bill Gross saying the Fed would not do anything for 12 months could not stop bonds from falling. You would think it would because the Fed is basically trying to keep bond yields lower. It is printing a lot of money and buying bonds as part of Quantitative Easing, and that would tend to prop up the price of bonds and thus keep yields lower. It is not working right now. The Fed has a lot of power with its liquidity machine, or the "supertanker" as I like to call it. It is offloading liquidity into the economy as fast as it can. It is having an impact, but it cannot control everything by dumping money into the system.

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Gold: Gold had a weaker session after a strong rebound this week. Thursday was very strong, and Friday it rallied up. It again tapped the 50 day EMA and stalled out, finishing down a bit ($1,349.50 - 3.50). It still has a big rounded top, looking head and shoulders-ish. Gold may not be the place to buy right now. Things have to set up a bit better.

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Oil: Oil may not be a good commodity to buy into right now either. Oil is struggling after bouncing up to the top of its range. Quite volatile over the past three weeks. It was in freefall until the Egyptian news started to crescendo. Then on Friday and Monday it was right back to the top of the range. There were worries that the issues in Egypt would spread just as they spread from Tunisia to Egypt. There were fears it would go to Jordan, Saudi Arabia, et cetera. As those fears started to die back, however, oil started to fade once more.

It really picked up speed on Friday ($89.03, -1.51). It is coming back down. It looks like it will trade into this range, come back to the October peak and the January low. That will be the first real test for the commodity to see if it will hold up. Again, it was in freefall, and actually starting to break lower through that support level last Thursday before the news hit and shot oil to the upside. Oil and gold are probably coming back some more just as the dollar tries to rally and bonds sell off.

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TECHNICAL SUMMARY

INTERNALS

Volume. NASDAQ volume rallied up not even a point and a half to 1.9B shares. NYSE volume fell to 919M, off almost 8%. The early read looked as if NASDAQ volume was higher, but it was not. We had a quiet, boring session. That does not give you a lot of comfort with NASDAQ. It broke through to a new rally high, and it did not have any volume to push it.

Breadth. Decliners led by a hair on the NASDAQ, and they led by the same hair on the NYSE. You do not often see the same breadth readings. It was a very quiet, boring day. Even though we had plenty of important news, the market did not have the strength in it to put in a wild session after all the volatility.


CHARTS

SP500. SP500 continued its trend to the upside. It already broke through the prior peaks, and it continued higher Friday. No great volume, just grinding out the upside in a nice uptrend. As noted, the only problem it had was this one-day reversal, and it bounced right back up. You can give a stock or index a day, and it can recover and everything is fine. That is exactly what it looks like on SP500. I hate to sound complacent, but what do you do? It keeps moving up, no matter what. Hard to fight it. It is riding that liquidity wave.

NASDAQ. NASDAQ made all the headlines. I said it was the key and you needed to watch it. Sure enough, it broke to a new rally high, but it was an inauspicious break. Volume was no great shakes not any greater than it has been of late (indeed, less than several sessions). Breadth was nothing. It was all basically large caps. There really was not a lot of power behind to move. I would not bet the farm on this kind of breakout. It could still come back down on us. It is in this lateral move. It just peaked up over the top of it, and it is not showing the kind of strength you like to see. It may get shot back down. We will have to see.

The thing is that SP500 keeps forging ahead and NASDAQ though reluctant has followed. It is hard to complain about the move, especially when we see other tech stocks starting to come back to life after getting their heads cut off a few weeks back. It is amazing, indeed, how some of them are responding to the upside so aggressively after being hammered on their earnings.

SP600. The small caps have not broken out to a new rally high. Still moving laterally for the last five to six weeks in that trading range. They are bumping up at the top and making a higher low. Maybe they will make a breakout here and follow everyone else out. That would be nice to see. It would give a little credence to the economic rally continuing, and does it ever need to continue. Only part of the economy is actually doing anything, and it has nothing to do with the part of the economy that makes any jobs.

SOX. SOX was moving impressively to a new rally high, breaking out again. A little pennant triangle formed here. It broke out to the upside. The semiconductors continue to perform very well.

SP400. The mid-caps look very similar to NASDAQ. It made a break to a new rally high, something that the SP600 has been unable to do. Very solid and steady, right at the 20 day EMA. Now the odd man out is the small cap index. Can it follow? If the rest of the market is moving up, it will follow behind it just may not lead. The small caps are not perceived as being the growth leaders from here on in with this recovery. They will be following along and not holding the lead.

We are in February, and I suppose we have had a bit of January effect. That may be out of the system, and now the managers and other investors are looking to different names. That may be why we are seeing retail turn back up after getting thrashed as well as some of those techs that got slaughtered. They are turning back up, getting money as well. Maybe the money is allocating out of smaller caps and into other areas that were downtrodden but are now showing some life.


LEADERSHIP

Technology. FFIV surged to the upside off this little inverted head and shoulders. After crashing downside, buyers are piling back into it. ADTN had a nice, sharp break to the upside on Friday. Even when it looks like the move is capped out, they are finding new buyers. CRM is bouncing back to the upside. It looked like it was a definite downside play, but it is picking up speed to the upside. JNPR is another that was hammered back on earnings. It has reversed immediately. A reversal gap, an island, and now it is surging. Money is coming back in after a short hiatus.

Retail. LULU broke higher on strong volume Friday. UA broke higher on strong volume. NKE sold off, trying to make its move back to the upside. SKX has been hammered forever. The last couple of days were strong days, moving to the upside. SHLD is breaking upside. It had a strong week. ANF is trying to turn and move back to the upside, and ANN is trying to do the same. These are not gimme patterns for sure, but they are showing that money is coming in a big way as volume makes the turn back to the upside.

Semiconductors. Chips look solid as well. ARMH had a big week with earnings. It is moving higher and doing well. BRKS reported earnings after the close on Thursday. It was down early and reversed. Volume came in and shoved it back to a new rally high. NVLS has been steadily moving higher up the 10 day EMA. ONNN has had big runs. It has been moving laterally for three weeks, and it may be ready to make a new break to the upside. There is plenty of money flowing into areas that did not have it a short time ago.


THE ECONOMY

Jobs report gives on the one hand, takes away with the other.

When you look at the economy, you have to look at the jobs report. Of course, it was the game in town on Friday. We are looking at a tale of two cities. We have 36K non-farm payrolls, which is less than one-third of expectations. There were 50K private payrolls, and that was also less than one-third of what was expected. Pitiful. We lost 504K people. Since October, we have lost 1M people from the work force. That jives with what Bernanke is saying; the recovery is too weak for an increase in the number of jobs created. Then again, there was improvement. The real unemployment rate was at 16.1M, and that was below the 16.9M reported in December. There is improvement, but those private payrolls were the fewest produced since January of 2010. Yin and yang.

Looking at the trend of the weekly jobless claims, there is improvement without a doubt. Weather likely played a role, although it only impacted the non-farm numbers. It would not impact the household number because whether or not you can get to your job, you are still counted as employed. With the non-farm, if you cannot get to the job to get hired, you are not going to get hired. That is what the weather would have impacted. You can also say that the non-farm payrolls were artificially depressed, and they very well could have been. We could have been up to the 50K that was expected. Those who want jobs but cannot get them rose to 6.7M. If they were included in the unemployment rate, it would be over 13%.

Not looking too good on the home front for jobs, but if you dig a little deeper, hourly earnings rose 0.4%. That is twice the rate expected. Would hourly earnings be moving higher if jobs were basically nonexistent and companies did not need help? This is sometimes a signal that hiring is about to start. Workers are demanding more money because they are getting worked more. Productivity made a huge move up on Thursday. We are getting more out of our workers.

How long can that go on before they want more help or they're out of there? Then other companies start cherry picking your best people, so you have to get outside help. That is all part of the equation, and we are likely to see it start to break sooner than later. If this new SBA bill is passed, they might actually get the help they need to start hiring a few people. The economy could be ripe enough for them to want to do that.

The strange thing is that (here is that yin and yang again) the average workweek fell to 34.2 from 34.3. The average workweek should be going up if we are getting more out of our workers and getting to the point where they need to hire more people. You should be pushing them harder and making them work more hours. If they do not have to work those hours, why would you hire new people?

There are multiple dichotomies within the report. That is why some people were scratching their heads and ready to through this one out the window. On one hand, hourly earnings are up. You must have to pay them more, therefore things must be better. It must be tight and ready to hire. On the other hand, they are not working them anymore in fact, they are working them less. Many features of this are head scratchers, and we will not know much until the next couple of months when we see how the weather plays out in the numbers.

Overall, take away the fact that the trend is improving. There is no great job surge, and the fall in the unemployment rate was most probably incorrect. This economy is simply not that strong. It will bounce back when all of the numbers get ironed out from the storms, but the overall trend is improving. Things are getting better, but it does not mean they will be great. That is the tragedy of it all. We could be great, but we are pursuing policies that make us mediocre. Those policies make us like all the other countries that pursue debt and have issues.

Why do I bring that up? Canada reported its jobs number as well, and it created four times the number of jobs expected. It was just 62,900 jobs, but they beat the hell out of the US. They almost doubled up what we made in the non-farm number. Canada did not get carried away with debt and did not buy into the subprime nonsense. They are actually performing well. Iceland was the poster child for the problems in the financial crisis, and it took a different tack than the US and European countries. It made the creditors pay for the bailouts, not the taxpayers.

It was dicey. There were times when they did not know if they would make it, but they did. They put it on the line, they made it, and now they are growing at the same rate the US is growing, and maybe better. They also do not have any debt. We have $14T in debt, and they have virtually nothing because of how they handled their problems. They are growing at the same rate that we are. What position would you rather be in?

We have to think about this moving ahead. There are a lot of things happening in this country, and we are at a crossroads. Do we go with big government and push this healthcare that has been declared unconstitutional by a couple of courts? It will get to the Supreme Court. Do we submit to raising the debt ceiling even higher because we have to pay our bills?

There are some things we absolutely do not need and should stop doing. We need to get back to having the states handle things and not trying to provide everything for everybody. We are not a socialist country. We are not a country that is supposed to have a powerful government that doles everything out. We are supposed to be a group of states that control their own destiny and trade with each other. The federal government just protects our borders and makes sure the trade between the states is fair. I am talking probable heresy to many people, but we have seen what works and what does not.

This last financial crisis is another case study of how to handle problems. We are trying to cure debt problems with more debt, and we are getting bills now that we cannot pay. How will we solve the problem? It is becoming clearer and clearer. The answer is not to provide everything that we provide now. It will have to stop, but it will be an ugly fight to get there. There was a Civil War where they said bother fought against brother and father fought against son. The fight over these entitlements will be very similar to that. Father against son, brother against brother as everyone vies for the government handouts. It will have to stop or be dramatically curtailed. The question is who will get it and who will not. It could get ugly.


THE MARKET

MARKET SENTIMENT

VIX. The VIX has been as volatile as oil and gold over the past couple of weeks. The fear on the Egyptian story has subsided just as rapidly as it showed up, coming back down to the lows hit in late December. While low, that is not necessarily an aberration. I have talked about this many, many times, but there is so much discussion of the VIX that it needs to be brought out.

Volatility can stay low and trend lower for years, and that does not mean the market is about to turn over. When you are in a sustained rally, volatility falls to a certain level. It can continue to fall. Only when volatility rises as the stock market rises (as it did in 2000) do you have worries about a serious correction. Now we just see a pullback to where it has bottomed recently, and that has led to modest corrections in the stock market.

Volatility bounces, the stock markets corrects, and then it is right back to rallying once more. There is nothing nefarious in the VIX, just "ordinary times" action.

VIX: 15.93; -0.76
VXN: 17.91; -1.18
VXO: 14.67; -0.38
Put/Call Ratio (CBOE): 0.87; 0

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: 52.7% versus 55.1%. Bulls continue to wane as NASDAQ and the growth indices struggle to follow SP500. Down modestly from 58.8% high on this leg. Still at a high level in a string of high readings but below the 5 year high at 62.0. Fading back from 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: 22.0% versus 19.1%. Climbing back up after a quick dip down to 19.1% a month back. 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: +15.42 points (+0.56%) to close at 2769.3
Volume: 1.902B (+1.41%)

Up Volume: 1.338B (+170.627M)
Down Volume: 611.89M (-144.189M)

A/D and Hi/Lo: Decliners led 1.06 to 1
Previous Session: Advancers led 1 to 1

New Highs: 171 (+30)
New Lows: 28 (+5)


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: +3.77 points (+0.29%) to close at 1310.87
NYSE Volume: 918.998M (-7.89%)

Up Volume: 470.022M (-125.404M)
Down Volume: 435.649M (+52.284M)

A/D and Hi/Lo: Decliners led 1.06 to 1
Previous Session: Advancers led 1.15 to 1

New Highs: 449 (+62)
New Lows: 56 (+26)

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

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


DJ30

Stats: +29.89 points (+0.25%) to close at 12092.15
Volume DJ30: 122M shares Friday versus 144M shares Thursday.

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


MONDAY

The news next week looks rather boring. There is not a lot coming out. We have the usual suspects and Michigan Sentiment on Friday. The rest of the week the economic data is not going to excite anyone that much. The stocks will be looking to the remaining earnings that are out there, as well as what is going on in the geopolitical world. We had a lot of good data on economics, and we had a lot of good data on earnings. We had a scare on the geopolitical scene, but it looks to be stabilizing. It should be nirvana for stocks at this point, right? We will have to see.

It has still been a long run, and there is still the possibility of a pullback. We cannot take that off the table despite the moves that the market has made, such as NASDAQ breaking up through its recent highs. It has been consolidating laterally, but it is not a very big consolidation. SP600 looks to have a better lateral consolidation ongoing than NASDAQ, but it has not been able to break higher as NASDAQ has.

Next week we may get out of the jobs picture and out of the economic data shadow. Maybe then we will see just how the indices will react given that NASDAQ just cracked through its high. I will not say NASDAQ will continue to move upside on this move. It may turn right back down in a vacuum of news with respect to the economy and earnings. That said, we have seen money flowing back into tech stocks. It was clearly there on Friday, and we will have to see if it continues and pushes the index higher.

If it does, that is fine. We will close out the QQQQ's we were just taking a chance on that anyway in the event that the Thursday turn to the downside got really ugly. As noted, buyers came right back in and pushed NASDAQ up. You could call this market irrepressible; it just does not want to fall back down. The Fed and its liquidity supertanker are pumping liquidity into the stock market. It is trying to build up the feeling of wealth by appreciating our financial assets. Therefore it has been trying to push the market higher so we would all feel wealthier and spend that money.

The problem is that the retail investor has not been into this stock market move very much. After getting burned in 2008 again and then getting burned by the flash crash in May, the retail investor has backed off again. The retail investor may not be feeling all that wealthy. That leaves it up to the big companies that have the stock holdings, and they got all the stimulus money anyway. We have seen what a rip-roaring recovery we get with them leading the way.

It has to be grass roots. One thing we should know in the US is that anything effective, widespread, and lasting has to be from the grassroots. That is where real change comes from, not from the big boys calling the shots and the government trying to pick winners and losers. It comes from the garages. It comes from the back study where those better ideas are hatched and then put into practice in our economy. Those are where the jobs come from.

There is encouraging news with the unemployment rate and the household survey. Maybe people are staying to hell with trying to find a job with these big guys who are still laying people off in this "great recovery." They may make their own jobs by starting their own businesses. If that is the case, then we will have some good growth ahead. The problem is the small cap stocks are not leading anymore, and that is where a lot of these companies would come from. Mixed signals, but the trend is better overall.

We will watch next week. We are concerned that NASDAQ will not be able to hold the break. It is good to be concerned, and we have been concerned all along. What has that gotten us? It keeps us honest. We have still been buying into upside plays because we are taking what the market gives. We are seeing downside plays set up. The problem is they will go down for a few days, but then they reverse and turn. The money keeps coming back in. Do be skeptical about moves. There is rotation ongoing, and at any time a certain sector could come under fire as a big mutual fund (or two or three or ten) start unloading shares in certain sectors and they start to sell off.

That money has been staying in the market. It has been moving somewhere else. We need to watch where it is moving just as we are now. We see a little tech coming back, and we were trying to pick up some tech this week. We are seeing retail come around. There may be other areas where it is trying to work its way back in, and we will have to move into those areas. Money is rotating around the market, so you follow it. You try to figure out where it is going, get in, and let it push your stocks to the upside.

We have been fortunate. We have been able to ride several positions for a long time. We will continue to do that as we look for new upside plays. I know this leg is extended. It has come a long way, but we just have to stick with the move as long as the plays keep turning up and giving us buy points. We have seen them give the buy points and then continue to move higher. That is the liquidity from the Fed.

Bernanke said again this week that he will stand by that. He believes that the unemployment rate is still too high. There are still too few jobs being created for any kind of self-sustaining recovery. He will keep that supertanker hooked up to the economy, and that would mean to the financial markets. He will keep pumping that liquidity in.

There will be times when the market stalls and comes back to test what has NASDAQ been doing for the past three weeks? It was unable to move and going laterally. After that, the liquidity kicks in again and you have another leg higher. We had the August to November leg, we had November which was basically a pullback, and then December on through January. Now a little three-week walk to the side. That is the pattern we have. We have a great base below this rally, and it still suggests that there is much more upside. Possibly two more of the kind of legs we have seen thus far.

It seems illogical. It does not seem like the market would run that much when it is just fueled by liquidity, but that is what liquidity does. How many times have we seen a stock or index run much further than we ever thought it could? With that in mind, I would like to use this quote from Bull Durham again because it is so relevant: You have to stick with the streak. Do not [censored] with the streak. If it is in place and working, go with it. Be wary, however. There is another quote I like from Field of Dreams: You have to watch out for in your ear when you are looking the other way. I know those are baseball quotes on a football weekend, but I could not think of any football movie quotes for the Super Bowl. If you think of any, send me an email and maybe I can use it in a supplemental report.

Have a great weekend!


Support and Resistance

NASDAQ: Closed at 2769.30

Resistance:
2825 is the 2007 closing peak.
2862 is the 2007 peak

Support:
2766 is the January peak
2735 from late 2007 interim peak
2729 is the 127% Fibonacci extension of the August 2010 run
2725 from July 2007 interim peak
2688 is the recent January low
The 50 day EMA at 2665
2593 is the November 2010 high
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
The 200 day SMA at 2407


S&P 500: Closed at 1310.87
Resistance:
1313 from the August 2008 interim peak
1325-27 is the March 2008 closing low and the May 2006 peak
1364 is the March 2007 low
1370 is the August 2007 low

Support:
The 20 day EMA at 1287
1278 is the 127% Fibonacci extension of the August 2010 run
The 50 day EMA at 1259
1227 is the November 2010 peak
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
The 200 day SM A at 1158
1156 is the Sept 2008 low
1151 is the January 2010 peak
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 12,062.26
Resistance:
12,110 from the March 2007 closing low
13,058 from the May 2008 peak on that bounce in the selling

Support:
11,893, from March 2008 closing low
11,867 from the August 2009 high and peak on that bounce in the selling.
The 20 day EMA at 11,867
11,734 from 11-98 peak
The 50 day EMA at 11,639
11,452 is the November 2010 peak
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 10,839
10,730 is the January 2010 peak


Economic Calendar

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

February 04 - Friday
Nonfarm Payrolls, January (08:30): 36K actual versus 148K expected, 121K prior (revised from 103K)
Nonfarm Private Payrolls, January (08:30): 50K actual versus 163K expected, 139K prior (revised from 113K)
Unemployment Rate, January (08:30): 9.0% actual versus 9.5% expected, 9.4% prior
Average Workweek, January (08:30): 34.2 actual versus 34.3 expected, 34.3 prior
Hourly Earnings, January (08:30): 0.4% actual versus 0.2% expected, 0.1% prior

February 07 - Monday
Consumer Credit, December (15:00): $2.5B expected, $1.3B prior

February 09 - Wednesday
MBA Mortgage Purchas, 02/04 (07:00): 11.3% prior
Crude Inventories, 02/05 (10:30): 2.59M prior

February 10 - Thursday
Initial Claims, 02/05 (08:30): 413K expected, 415K prior
Continuing Claims, 01/29 (08:30): 3900K expected, 3925K prior
Wholesale Inventories, December (10:00): 0.7% expected, -0.2% prior
Treasury Budget, January (14:00): -$50.0B expected, -42.6B prior

February 11 - Friday
Trade Balance, December (08:30): -$40.7B expected, -$38.3B prior
Michigan Sentiment, February (09:55): 75.5 expected, 74.2 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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