Market Forecast + Sector Watch: SPX, Nasdaq, XME, USO, GLD, MOO, SWH

Last weekend, in my Market Watch, I wrote:

"For the new week, the earnings reports are going to be the driving force.  The market has run up for 5 consecutive days and may need to rest and trade sideways to start the week.  INTC and ALTR will report after the market on Tuesday.  On Wednesday, quote/JPM">JPM kicks off earnings for the financials in the morning.  On Thursday, bellwether companies such as GS, IBM, and GOOG will report.  On Friday, GE, BAC, and HAL will wrap up for the week’s earnings.  The market seems to be bullish about this earnings season.  Financials and techs should be the focus this week, and both are looking strong.  To push higher, the market will need to catch the daily upper BBs (SPX 1080; Nasdaq 2150), which happen to be the recent resistance levels.  Oil is becoming stronger and gold has room to push higher."

Once again, things pretty much happened as forecasted.  As predicted, the market traded sideways on Monday and Tuesday, awaiting for the earnings to come.  On Tuesday night, INTC reported surprisingly good earnings and stock futures jumped.  On Wednesday, JPM added to the good news and the market was off and running.  Both SPX and Nasdaq closed above their respective resistance levels (SPX 1080; Nasdaq 2150).  On Thursday, we started to see some profit-taking, but, the energy sectors kept the market higher.  After the market, GOOG delivered superb earnings.  On Friday, both GE and BAC missed on their earnings estimates while HAL beat.  The market saw more profit-taking, but managed to stay above SPX 1080 and Nasdaq 2150.  

For the week, the Dow was up +130.94 points; SPX added +16.19 points; Nasdaq gained +17.52 points.  Both oil and gold were strong, especially oil.  Oil went back above $75/barrel and gold traded above $1050/ounce.  The dollar continued to slipped, but again, managed a bounce on Friday.  At the time of this writing, Asian markets were mixed.  Nikkei (Japan) was seeing weakness while the Taiwanese and Chinese markets pushed higher.  Let’s see how the US market looks after Friday’s close:

SPX

On Friday, SPX slid 8.88 points to close at 1087.68.  Its daily MAs and MAcd were higher.

Nasdaq

Nasdaq fell 16.49 points to close at 2156.8.  It closed above its daily MAs and above the 1250 level.  The MACD flattened.

As mentioned above, both SPX and Nasdaq closed above their recent resistance levels: SPX 1080 and Nasdaq 2150, which can now turn into support levels.  Both indices are also showing new bullish formation in their respective daily MAs.  VIX has dropped below 22.  For the new week…

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