Wizzwatch Weekly Newsletter

As the last week of February comes to a close, all three major indices turned to the downside. The Dow Jones Industrial Average, the Nasdaq Composite Index as well as the Standard and Poors 500 all moved lower. The key driver to the pullback in all three major indices was due to the continued unrest in the Middle East.

Investors focused primarily on the price of oil due to the fact that any disruption of the flow of oil will lead to higher prices going forward. Libya is the third largest producer of oil in the region. If the flow of oil is halted due to the unrest in Libya we may see the price of oil fluctuate above $200 per barrel. The top sectors this week were the oil index up +8.23%, followed by the S&P Energy Index +7.31%, the Gold Miners Bullish Percent Index +6.67%, the S&P Commodity Index +5.01%, and the CRB Index +2.78%.

The oil Index advanced to a new 52 week price high due to the unrest in the Middle East. The oil index began the week trading at $90.04 per barrel but moved slightly lower before making a huge run up to the $103.41 per barrel area before ending the week trading at $97.88. Oil may continue to move higher in the coming weeks depending on if the conflict continues to spread throughout the region. The oil index ended the week trading at $97.88 up $9.08 or 10.23%.

The top stocks in the market this week were that moved higher to the upside as the rest of the market tumbled were (BDCO) Blue Dolphin Energy +137.12%, (ROYL) Royal Energy +133.49%, (CRFN) Cresent Financial +91.63%, (MXC) Mexco Energy Corp. +64.96%, and (FONR) Fonar Corp. +55.47%.

The gold index also moved higher this week closing in on its 52 week price high in the $1,430.60 area. The gold index has been making higher highs and higher lows for the past 4 weeks. Downside support for the gold index is at $1,371.60 with upside resistance at $1,430.75. The price of gold ended the week trading at $1,408.00 up $20.50 or +1.48%.

The Dow Jones Industrial Average began the week trading at 12,389.74 but moved to a price low in the 11,983.17 area before ending the week closing slightly higher. The Dow Jones Industrial Average has been making higher highs and higher lows for 21 of the past 28 weeks. Downside support for the index is at 11,942.52 with upside resistance in the 12,391.40 area.

There were 3 stocks in the Dow 30 that moved higher as the other 27 stocks in the index tumbled. The top stocks for the week were (CVX) Chevron Corp. +5.07%, (KFT) Kraft Foods, Inc. +2.82%, and (XOM) Exxon Mobile +1.74%. The Dow Jones Industrial Average ended the week trading at 12,130.45 down -260.80 or -2.10% on lighter than average downside volume of 3.42 billion. The average weekly trading volume for the Dow Jones Industrial Average is 3.77 billion.

The Nasdaq Composite Index also moved lower this week after starting the week trading at 2,795.44. The index then moved to a price low in the 2,705.54 area before ending the week trading slightly higher on the upside above its 5 week moving average at 2,776.13.

The Nasdaq has been making higher highs and higher lows for several weeks but may move even lower in the week ahead depending on the conflict in the Middle East. Downside support for the index is in the 2,734.71 area with upside resistance at 2,840.60. The index is currently above its 5, 10, 32, 50 and 200 week moving averages.

The top stocks in the Nasdaq 100 this week were (APOL) Apollo Group +4.88%, (DTV) Direct TV Group +3.93%, (INTU) Intuit, Inc. +3.89%, (QGEN) Qigen +3.25%, and (ALTR) Altera Corp. +1.96%. The Nasdaq Composite Index ended the week trading at 2,781.05 down -52.90 points or -1.80% on lighter than average downside volume of 8.67 billion. The average weekly trading volume for the Nasdaq is 9.36 billion.

At the Standard and Poors 500 there was no escape from the downside pressure in the market as the index declined for the first time in 4 weeks. This weeks drop in the index was its biggest decline in 3 three months. The index has been making higher highs and higher lows for since September of 2010. Downside support for the index is in the 1,294.18 area with upside resistance at 1,344.17.

The move to the downside was the biggest drop in the S&P 500 in 3 months. As for now the index remains above its 5, 10, 32, 50 and 200 week moving averages. The top movers in the S&P 500 this week were (CHK) Chesapeake Energy +16.01%, (COG) Cabot Oil & Gas +12.26%, (RRC) Range Resources Corp. +11.48%, (VFC) VF Corp. +9.55%, and (PCS) Metro PCS Communications +7.55%.

The Standard and Poors 500 ended the week trading at 1,319.88 -23.13 or -1.72% on lighter than average upside volume of 15.9 billion. The average weekly trading volume for the S&P 500 is 16.72 billion.

By: Marlin Rolle

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