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StreetOne Technical Analysis, LLC Market Summary-04/13/2010

|Includes: EEM, EWJ, GLD, IAU, IWM, SGOL, SLV, SMH, TNA, XLB, Financial Select Sector SPDR ETF (XLF), XLI, XME, XRT

 The Market started the session and the week to the upside, then bumped against some resistance early PM and sold off into the close. The three major indices managed to make new highs and the DJIA closed above the psychological 11000 level. At the close, the DJIA was up 8 points, the S&P500 up 2, and the Nasdaq100 gained just 1 point. Breadth was positive, nearly 4 to 3 on the NYSE. We remain at the best levels since Sept. 2008. Momentum has slowed and the S&P500 and Nasdaq100 are slightly overbought short term.  Both indices met some resistance near 1200 and 2000 levels in the last session.  Near term support remains at 1175 and 1975 areas for the S&P500 and Nasdaq100. The S&P500 and the DJIA short term upside potential and resistance is near 1225 and 11254 areas(Fibonacci levels). The Financials (XLF), closed at a new high again, 16.61, up just 0.07. Support remains at 16.50, 16.30, 16.15, and 16.00.  Resistance at 16.75, and 17.00. GOLD(GLD) pulled back after trading as high as 114.13 and closed down 0.63 to 113.01. Remains strong at this level.  The VIX made a new low, closing down 3.4% to 15.58.

 

Trading Trend

Long term, technicals remain positive as we continue to make and trade near recent highs.  Short term, upside bias continues, momentum slowing. Near term, momentum has slowed and bumping against some resistance near 1200 and 2000 levels on the S&P500 and the Nasdaq100. Earning’s season begins and investors and traders will be looking for top line growth.  Note support levels above for near term direction. Today’s futures(at 8:15am) are lower versus fair value. Economic recovery confirmation(e.g.-employment, consumer spending) and interest rates have become the key Market movers.

 

Major Economic Reports Today:

Export/Import Prices -8:30am    Trade Balance-8:30am  

  

MAJOR INDICES - Short term support and resistance levels

DJIA-(close 11005)

SP500-(close 1196)

N100-(close 1995)

11000

11045

1184

1197

1988

1997

10930

11125

1175

1200

1976

2000

10843

11254

1172

1213

1975

2012

10800

11500

1170

1225

1963

2025

10725

 

1165

1250

1955

2050

10648

 

1160

 

1950

 

10641

 

1150

 

1940

 

10605

 

1148

 

1935

 

 

 

1147

 

 

 

 

 

Options/Derivative Flows(from the desk of P.Weisbruch)

In EWJ (iShares Japan), in which we have noted the strength in the ETF in our ETF Daily for weeks, call buyers have been present in the marketplace. September 12 calls specifically have been accumulated, and although these are significantly out of the money, the call buyers likely believe there is more upside in EWJ, which is already up over 9% YTD. In VIX (S&P Volatility Index) options, buyers of May 18 puts surfaced, with the index trading at it's lowest level in 2 years. Finally, in Retailers, buyers of June 40 puts in XRT (SPDR Retail) hit the tape and are probably hedging against a correction in an ETF which is trading at a multi-year high, and up over 20% YTD. In SLV (ishares Silver), July 17 puts were bought versus stock delta neutral, although we suspect the motivation is outright put buying as a hedge or outright speculation of a correction. SLV, like other metals including Gold, has rallied over 9% the past two weeks.

 

In XLI (SPDR Industrials) the May 31 puts were bought in good size. Trading at it's highest level since September 2008, investors are likely protecting recent gains in the ETF from a pullback.

 

 

 

 

 

Trade Ideas

SMH(Semis Holdrs Merrill Lynch)-Closed 28.75(new high). Breakout level 28.60.

GLD-(SPDR Gold Trust)-Closed 113.01, remains buy above 112. Similar trade IAU(iShares Gold Trust). SGOL(OTC:ETFS)- Closed at 115.23, Remains buy above breakout of 115. May test all time high of 121.50.

XME(SPDR S&P Metals and Mining)-Closed 59.42. Hitting resistance near 60.30.  Breakout level was - 58.73.  Similar trade, XLB(SPDR SEL materials).

IWM(iShares Russell 2000)- Closed 70.54(new high). Remains buy above breakout level-69.23. Similar trade TNA(Direxion Small Cap-3X leverage)

EEM(iShares Emerging Markets)-Closed at 43.43. Remains a buy above breakout level-43,20.

 

Recent Calls

XME(SPDR S&P Metals and Mining)-Closed 59.42. Trading slightly up to sideways since calling on 4/7. Hitting resistance near 60.30.  Breakout level was - 58.73.  Similar trade, XLB(SPDR SEL materials).

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