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Weekly Wrap-Up + Market Forecast + Sector Watch: SPX, Nasdaq, XME, OIH, XLF, MOO, GS, WFC, JPM, MA, V, CME, ICE, RIG, DO, CLF, POT, MOS, AGU, CLF, BTU, WLT, ANR

|Includes:AGU, BTUUQ, CLF, CME, DO, GS, ICE, JPM, MA, MOO, MOS, OIH, POT, RIG, V, WFC, XLF, SPDR S&P Metals and Mining ETF (XME)

The market broke a 2-week winning streak to end lower.  In my Market Forecast last weekend, I wrote:

"For the new week, we'll have to see if this market can continue its rally that started 2 weeks ago.  One bullish sign is that for SPX and DJI, the 10-day MA has risen above the 30-day MA, and the MACDs are still bullish.  The market really needs to see a bigger jump.  SPX needs to break above 1280 to get the shorts to cover.  Financials are once again the key.  While they may not lead the market up, but, at least, we'll need to see them going higher in order for the market to rally.  Energy stocks and fertilizers seem weak, which we'll take a closer look in Sector Watch."

Well, financials gapped down lower on Monday and pretty much set the tone for the week.  Energy and fertilizer stocks also plummeted.  After a weak Monday, the market gave in to selling pressure on Tuesday, as the Fed avoided mentioning further quantitative easing.  We traded on the downside and booked some quick profits.  Stocks slide lower on Wednesday, and, we booked more profits on the downside, including an intraday +78% winner on FFIV puts.  The market tried hard to bounce on Thursday and Friday, but, was not able to get very far.

Here are our closed trades for the week:

  • 09:14 | HappyTrading MOS ($46.80) Sold to Close 12P50 Dec 50 put, at $3.35 +34%
  • 08:45 | HappyTrading FFIV ($103.90) Sold to Close 12P105 Dec 105 put, at $2.45 +78%
  • 08:17 | HappyTrading FFIV ($104.40) Sold to Close 12P105 Dec 105 put, at $2.15 +68%
  • 08:16 | HappyTrading MOS ($46.90) Sold to Close 12P50 Dec 50 put, at $3.20 +28%
  • 12:26 | HappyTrading GOOG ($631.00) Sold to Close 12C630 Dec 630 calls, at $5.50 -26%
  • 12:02 | HappyTrading WYNN ($105.60) Sold to Close 12P110 Dec 110 put, at $5.00 +47%
  • 11:52 | HappyTrading WYNN ($105.60) Sold to Close 12P110 Dec 110 put, at $4.90 +44%
  • 08:09 | HappyTrading IBM ($192.50) Sold to Close 12C195 Dec 195 calls, at $0.55 -45%
  • 12:40 | HappyTrading GS ($97.80) Sold to Close 12P100 Dec 100 put, at $3.50 +6%
  • 07:26 | HappyTrading AAPL ($391.60) Sold to Close 12C400 Dec 400 calls, at $1.51 -70%

For the week, the Dow was down 317.87 points; SPX lost 35.53 points; Nasdaq fell 91.52 points.  Both gold and oil took sharp falls, with gold trading under $1600/ounce and oil falling back to $93/barrel.  At the time of this writing, Asian markets were mostly down.  Let's take a look at where the US market stood after Friday's close:

SPX

On Friday, SPX added +3.91 points to close at 1219.66.  It closed below its daily MAs.  The MACD was slightly down.

Nasdaq

Nasdaq gained +14.32 points to close at 2555.33.  Its daily MAs and MACD slid.

Even though VIX stayed weak and closed below 25.  Both SPX and Nasdaq closed below their respective daily MAs.  Further, their respective 10-day MAs turned down again!  For the new week...

To read the rest of this article, please subscribe to HappyTrading "Premium Articles" by going to the Premium Services (click here) page. If you are already a subscriber, please click here: Market Forecast 12/18/11.

Stocks: XME, OIH, XLF, MOO, GS, WFC, JPM, MA, V, CME, ICE, RIG, DO, CLF, POT, MOS, AGU, BTUUQ, WLTZQ