After a set back two weeks ago, stocks rebounded last week with the Finance SPDR (XLF) and Consumer Discretionary SPDR (XLY) leading the charge. Both XLF and XLY recorded 52-week highs last week to extend their uptrends and establish support based on their April lows. Last week's rebound was quite impressive, but this week will mark the true test for the markets. Third quarter earnings season is still underway and we have a slew of economic data hitting the fan this week. Chicago PMI is Tuesday, ADP and ISM Manufacturing are Wednesday, the FOMC policy statement is also Wednesday, Jobless claims are Thursday and the employment report is on Friday. ISM Services and Factory Orders end the week on Friday at 10AM. This is going to be a big week for stocks, Treasuries and the Dollar.
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Key Reports and Events (all times Eastern):
Mon - Apr 29 - 08:30 - Personal Income and Spending
Mon - Apr 29 - 10:00 - Pending Home Sales
Tue - Apr 30 - 09:00 - Case-Shiller 20-city Housing Index
Tue - Apr 30 - 09:45 - Chicago PMI
Tue - Apr 30 - 10:00 - Consumer Confidence
Wed - May 01 - 07:00 - MBA Mortgage Index
Wed - May 01 - 08:15 - ADP Employment Report
Wed - May 01 - 10:00 - ISM Manufacturing Index
Wed - May 01 - 10:00 - Construction Spending
Wed - May 01 - 10:30 - Oil Inventories
Wed - May 01 - 14:15 - FOMC Policy Statement
Wed - May 01 - 15:00 - Auto and Truck Sales
Thu - May 02 - 07:30 - Challenger Job Cuts
Thu - May 02 - 08:30 - Jobless Claims
Thu - May 02 - 10:30 - Natural Gas Inventories
Fri - May 03 - 08:30 - Employment Report
Fri - May 03 - 10:00 - Factory Orders
Fri - May 03 - 10:00 - ISM Services Index
Charts of Interest: Tuesday and Thursday
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is
not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise).
We all need to think for ourselves when it comes to trading our own accounts. First, it is
the only way to really learn. Second, we are the only ones responsible for our decisions.
Think of these charts as food for further analysis. Before making a trade, it is important
to have a plan. Plan the trade and trade the plan. Among other things, this includes setting
a trigger level, a target area and a stop-loss level. It is also important to plan for three
possible price movements: advance, decline or sideways. Have a plan for all three scenarios
BEFORE making the trade. Consider possible holding times. And finally, look at overall market
conditions and sector/industry performance.
About the author:
Arthur Hill, CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London.
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