Earnings Season Kicks Off Today

Monday left the market with a light volume rise. Buyers stepped in off the early weakness and pushed the market all afternoon to finish on the highs. Fairly digestive action today with no compelling reason to see the market expand. Earnings season kicks off Tuesday after the bell with Alcoa, showing that some buyers maybe sidelined until we start to see earnings roll out. Growth is dependent upon seeing growth and outlook for each quarter. Good growth translates to jobs, salaries, cap ex spending etc… so this will tell us what the economy is really doing. Some corrective action is still trying to sneak in the market and even profit taking. Which we are still seeing in pockets of the market.

Tuesday with no market moving economic data we may see a slow start on the day. A move on the Nasdaq up to test last weeks highs is in sight, but with the SOX giving up ground in the last two hours of Monday’s action we have to look for tech participation. The Nasdaq held strong until late day and it couldn’t muster up a new high with the other broader markets. Leaving me to think we see some pullback early Tuesday and again look for buyers to step in. We could see a fairly quiet day and then an active second half of the week once earnings kick off. AA is a Dow component so the first biggie on tap for us.

Economic Data released for the Week of January 8th — 12th
7:45 UBS Store Sales, 8:55 Redbook, Wednesday 08:30 Trade Balance, 10:00 Wholesale Trade Inventories, 10:30 Crude Inventories, 12:30 Chi Fed Bank Pres. Moskow to speak, Thursday 08:00 NY Fed Bank Pres Geithner to speak, 08:30 Initial Claims, 10:30 Natural Gas inventories, 14:00 Treasury Budget, Friday 08:30 Export Prices ex-oil, 08:30 Import Prices ex-oil, 08:30 Retail Sales, 08:30 Retail Sales ex-auto, 10:00 Business Inventories.

Some Earnings for the Week of January 8th — 12th Tuesday pre market — EMMS, ETP, LWSN, SVU and after the bell AA, RI. Wednesday after the bell — DNA, SAPE. Thursday pre market — INFY, MTB, SRR and after the bell CAMP. Friday nothing of interest. Still a fairly light week, but it will start to pick up now.

ES (S&P 500 e-mini) Tuesday’s pivot is 1420.00, the weekly is 1423.50. The 1416.50 did break and let us test the 1413 support, which held and quickly bounced us right back over 1416.50. So once again this level holds the test of the market. The bounce Monday did leave the ES right into 38.2% retracement resistance (1423.50) which will be key for higher ground. The weekly pivot is at this same spot giving us two pivotal pieces of data at this closing level. A break of 38.2% signifies a reversal in the short term direction on this intraday look. A move back up through the resistance should be watched with a break of this 1423.50. Failure here would result in another look at 1416.50 and even lower. Intra day support: 1420.25, 1418.75, 1416.50, 1413, 1408 1403 (will be key), 1400, 1391.75 support levels. Resistance to look for -1423.50, 1426.50, 1427.75 (fills the gap), 1429.75, 1432, 1434.25. 60 minute chart is below.

ER (Russell 2000) Tuesday’s pivot is 780.00, the weekly is 787.20. The ER tested the lows from November 28th and held that support today (775.50). Still holding under 38.2% (786.10) is lagging the ES some and that should be watched. Intra day support: 780.50, 779.20, 778, 776.10, 775.50, 773.80, 771.30. Resistance: 782, 784.50, 786.10, 788.40, 790.70, 792.5, 794.00, 795.50 (fills open gap) and 798.30. 60 minute chart below

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