Wizzwatch Weekly Newsletter

As this week in the stock market came to a close there was a huge pullback in all three major indices as stocks fell the most in one year. Financials and industrials were the worst performers for the week taking the market lower. Stocks are now getting cheaper, but we are not seeing any panic selling like we saw during the financial crisis. Ecomomic numbers were not as good as many analyst expected as housing numbers, manufacturing, and jobless claims came in lower. A correction is needed in the market going forward after months of upside momentum. The Dow Jones Industrial Average, the Nasdaq and the S&P 500 all suffered as they continued to move lower. All three indices are very over sold and its time for a turn around but only time will tell in the weeks to come. The stock market may continue to move lower in the next few months. The month of May historically is the beginning of a sell off in the market until mid October. The (VIX) Volatility Index moved higher this week as more and more fear came into the market scaring investors away from the market as stocks sold off.

The Dow Jones Industrial Average began the week trading at 10,616.98 moved to a price high in the 10,718 area before ending the week lower for 3 of the past 4 trading weeks. All 30 stocks in the Dow ended the week trading lower. Downside support for the Dow is currently at 9,869.62 with upside resistance at 11,258.01. The Dow Jones Industrial Average is now below its 5, 10, 32, and 200 week moving average but above its 50 week moving average at 9,980.40. The Dow Jones Industrials ended the week trading at 10,193.39 down 426.77 points or -4.02% on heavier than average volume of 6.10 million. The average trading volume for the index is 4.79 billion.

The Nasdaq Composite Index pulled back ending the week above its 50 week moving average. Downside support for the Nasdaq is at 2,158.51 with resistance on the upside in the 2,535.28 area. The index is above its 200 and 50 week moving averages. The Nasdaq ended the week trading at 2,229.04 down -117.81 or -5.02% on heavier than average volume of 14.38 billion. The average weekly volume for the Nasdaq Composite Index is 11.27 billion.

As for the S&P 500 the index has been continuing to decline moving to the downside for 3 of the past 4 weeks. The index had its biggest price decline in 13 months. The average weekly trading volume for the S&P is 21.02 billion. The index ended the week trading on heavier than average downside volume of 29.17 billion. During Friday's pullback 99% of the stocks trading in the Standard and Poors 500 traded on the downside. This week was a brutal one taking the S&P 500 back to where it traded two months prior. The S&P 500 ended the week trading at 1,087.69 down 47.99 or -4.23%.

Gold prices reached an all time price high at $1,249.30 per troy ounce the week prior but pulled back to end the week trading on the downside. The price of gold has moved to the upside 7 of the past 9 weeks. To end the week the gold index ended the week trading at $1,177.10 down $55.50 or -4.50%.

As the oil continues to spill in the Gulf of Mexico the price of oil is on a third week of consecutive declines. The index is below its 5, 10, 32, 50 and 200 week moving averages. Downside support for the price of oil is at $65.05.

The U.S. Dollar declined for the first time in many weeks against a basket of major currency pairs. The dollar index has been moving to the upside making higher highs and lows for 19 of the past 27 weeks. The index is above its 5, 10, 32, 50 and 200 week moving averages. The EUR/USD ended the week trading at 1.4466/68, USD/JPY at 89.97/89, USD/CAD at 1.0592/95, USD/CHF at 1.1493/95 and the AUD/USD at 0.8324/27.

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