WizzWatch Market Newsletter 05.03.09 – 05.07.09

To end this week in the market the Dow Jones Industrial Average, the Standard and Poors 500 and the Nasdaq all ended the week on the upside. The S&P 500 and the Dow Industrials have been moving to the upside for 7 out of the past 8 weeks. As for the Nasdaq, it has been on a run up for 8 consecutive weeks. This week’s upside move in the market was lead by utilities up 4.6 percent for the week. Crude oil also jumped to a 4 week high to end the week trading at $53.30 per barrel. Industrial stocks such as Caterpillar, Boeing and Alcoa helped push the Dow higher to end the week on the upside as financials declined. On the earning front there were a total of 338 companies that reported, 232 had positive earnings while 103 were negative. The factory confidence gauge reached at a seven year high, a sign that the market may be recovering.

At the Dow Industrial Average the index continued to trend higher after declining slightly the week prior. The Index is currently above its 5, and 10 week moving averages but below its 32, 50 and 200 week moving averages. As for now there is heavy resistance above 8,405.87. In order for the Dow Industrials to move higher the index must break above resistance, downside support on the Dow is at 7,648.94. If Downside support is broken we may pullback to re-test the lows that were made at 6,469.95. The index opened up the week at 8,073.82 and ended the week at 8,212.41 +136.12 or +1.69 percent on 7.14 billion trading volume above its average weekly at 6.5 billion.

At the Nasdaq Composite the index continues to lead the market higher moving to the upside for 8 consecutive weeks. The Nasdaq is above its 5, 10 and 32 week moving average but below its 50 and 200 week moving averages. The 50 week moving average is currently at 1,862.22 while top side resistance is slightly above the 50 week moving average at 1,896.95. For the index to continue higher the Nasdaq would need to break above resistance going forward. Downside support on the Nasdaq is at 1,546.66. The Index ended the week trading at 1,719.20 +24.91 points or +1.47 percent on 11.58 billion volume. The average weekly trading volume for the tech weighed index is 10.5 billion.

The Standard and Poors 500 Index ended the week on the upside after a small decline the week prior. The S&P 500 is up 7 out of the last 8 weeks of trading. The move to the upside was lead by (MEE) Massey Energy to name a few as the stock climbed 32.48 percent. The S&P is currently above its 5, 10 and 32 week moving averages. The index moved above the 32 week moving average to end the week slightly higher. The 32 week moving average is at 871.32, the 50 week moving average is at 1,023.51 and the 200 week is at 1,276.64. We have a long way to go before the markets are once again normalized; we are still in a bear market. Upside resistance at the S&P is at 975.50 and downside support is at 805.19. If downside support is broken we will see the S&P pullback to re-test prior multi year lows. The S&P ended the week trading at 877.52 +11.29 or +1.30 percent on 23.65 billion trading volume. The average weekly volume for the S&P 500 is 22.45 billion. The index is poised to move higher in the near term but needs to break through upside resistance at 975.50.

In the Gold markets there were declines across the board due to the continuation of momentum in the major indices. The Gold Continuous Contract Index, the Amex Gold Bugs Index, the Philadelphia Gold and Silver Index as well as the (GLD) Street Track Gold Index were all on the downside to end the week. The Gold Index has been on a decline 7 of the past 9 weeks. The index is currently trading above its 32, 50 and 200 week moving averages but below its 5 and 10 week moving averages. Prior to the decline the index ran up for 9 out of 14 weeks coming very close to multi year highs at $1,030.00. The gold index is poised to move higher in the coming weeks depending on the direction of the major indices. If the market continues to move to the upside we will see gold move much lower, but if it declines we will see an opposite move in the price of gold. To end the week the gold index ended trading on the downside at 886.40 -26.60 points or -2.91 percent on the downside.

As for the outlook of the oil markets the index moved to the upside to end the week in the green. The Oil Index has been on a decline for the past 2 weeks. The index is above both its 5 and 10 week moving averages but below it 32, 50 and 200 week moving averages. Oil is down 63 percent from its all time high of $147.90 per barrel set in July of 2008. Upside resistance for oil is at $55.98 per barrel with downside support at $50.62 . The index attempted to move above resistance on 5 different occasions but never advanced due to the bears defeating the bulls on every attempt. As for now we remain below $55.98 per barrel resistance but any move above that price level will take the price of oil much higher. The oil index ended the week trading at $53.20 +1.65 or 3.20%.

By: Marlin Rolle
*** Please have a close look at the charts below ***