* Where Value Lies - Since 7/27, nearly 70% of all ES volume and nearly 70% of all one-minute closing prices occurred between 1487 and 1453.50. That's the broad value area for this market. Given the market weakness at week's end, a good Market Profile trader will now look to see this week how we trade relative to this range, especially if we accept or reject value below the lower band.
• Where Strength Lies - It's been a weak month for stocks, but 9 of the 40 S&P stocks I follow in my basket (evenly divided among eight sectors) are actually up over the past 20 trading sessions. These include UPS, PG, KO, WAG, SLB, MRK, LLY, IBM, and CSCO. Recession resistant issues--Consumer Staples stocks--have been particularly strong. Defense stocks ($DFX) have also held up relatively well.
• Strength in the Mortgage Patch - FNM and FRE--Fannie and Freddy--don't seem to mind the mortgage weakness; their securities are backed by fixed-rate mortgages, not the riskier adjustables that are experiencing foreclosures. They were unusually strong, though volatile, this past week.