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Monday, July 19, 2010

Monday Morning Update


This morning's chart presented a real challenge, as I could not see the support and resistance levels until I applied the principle of Occam's Razor, which in essence states "the simplest explanation is most likely the best". So I just put in 10 point intervals, starting with 1060, then 1070, and finally 1080. Not perfect, but it looks about right. We had a brief rally at the open, but a sharp and nasty reversal at 10am, which is when another round of housing numbers were released. There is also a Moody's downgrade of Ireland, but I don't know what time that was released. In any case, the market appears to be testing the lower end of the reange, and breaking 1060 will be quite bearish. XLU, XLV, and XLK are leading, and are the only sectors currently in the green, with XLF way, way behind. The Nasdaq has a slight lead, but the Russell 2000 is trailing badly. Treasury yields are up a smidge, oil is up, gold down.

I have 28 new highs so far, with nothing that really looks like a breakout. I have 3 stocks from the relative strength list scheduled to report this morning, CPWR, HAS, and NWBI, none of which have reported. I will try to get a revised earnings schedule sometime today.

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