主题：12/22/2009 Market View -- 宁子

After hours GM had its rating cut to C something from C something. Okay, business stinks and the company is in jeopardy. I think we get it. The toilet-hugging price pattern pretty much indicates investors understand the situation, TARP funds or no TARP funds. TXT (everything industrial) lowered its guidance and announced 2200 job cuts after the bell as well. And the beat goes on.

Economic news starts back up with the final negative Q3 GDP reading. Non-existing home sales and no new home sales are out, along with poor Michigan sentiment. As you note from my descriptions, I am not expecting any major changes in the path of the economic data. It is simply too early for any change in the data. The market is just now trying to move higher, and it has yet to really show it means business.

Yes there are some great moves in progress and we have made some solid money off the bounces, but there has to be another major breakthrough to the upside soon. DJ30 and DJ30 have put in a couple of attempts at the next resistance and both times faded. The first was a higher high; great. Now it is time to make the next break higher and take out that resistance.

Tough to do it during a stretch of two back to back holiday shortened weeks, at least a move with the kind of volume that means anything. At this juncture, however, I think most investors would happily take a light volume melt higher through resistance if some of the leadership stocks put on a decent volume display as they broke higher.

Many stocks tested Monday and recovered some lost ground. There were quite a few, however, that could not get up with the rest of the market. This is an important test for the nascent rally as you want to see the upside bias prevail in the absence of any serious volume in the market. If it cannot return and stocks start to break near support once more we are not going to wait around too long to see the final scene. If we get out and have to get back in on a rebound, okay. There are still enough solid patterns to hold and continue the move, but there are also several that are getting borderline. If they cannot hold we close them and go holiday shopping. If they do hold we move in on a rebound and make some more scratch to . . . spend on holiday shopping. Hey, have to get the old economy going again, right?

Support and Resistance

NASDAQ: Closed at 1532.35

Resistance:

The 18 day EMA at 1536

1536 is the late November 2008 peak

1542 is the early October 2008 low

The 10 day EMA is 1543

1565 is the second low in October 2008

1579 is the 50 day SMA that stalled NASDAQ last week

1603 is the December peak

1620 from the early 2001 low

The 50 day EMA at 1627

1644 from August 2003

1752 from 2004

1782 from August 2004

1786 is the November 2008 high

1846 is the 90 day SMA

Support:

1521 is the late 2002 peak following the bounce off the bear market low

1499.21 is the 2008 closing low

1493 is the October 2008 low. Key low.

1428 is the November 2008 low

1398 is the early December 2008 low

1387 is the 2001 low

1295 is the November 2008 low

1253 is the March 2003 low on the test of the rally off the 2002 bear market low

1108 is the 2002 low

S&P 500: Closed at 871.63

Resistance:

The 18 day EMA at 882

The 10 day EMA at 884

889 is an interim 2002 peak

896 is the late November 2008 peak

899 is the early October closing low

919 is the early December peak

The 50 day EMA at 926

965 is the 2003 consolidation low

995 from June 2003 consolidation peak

1008 is the November 2008 peak

1065 is the Q4 2003 level that SP500 started the run to 2007 after the first run in the recovery.

Support:

866 is the second October 2008 low

853 is the July 2002 low

848 is the October 2008 closing low

839 is the early October 2008 low

815 is the early December 2008 low

818 is the November 2008 low

800 is the March 2003 post bottom low

768 is the 2002 bear market low

741 is the November 2008 low

650 on the top and 625 on the bottom of a 7 month range in 1996

475 from 1994 where the market moved laterally for the entire year.

Dow: Closed at 8519.69

Resistance:

8521 is an interim high in March 2003 after the March 2003 low

8626 from December 2002

The 18 day EMA at 8633

The 10 day EMA at 8626

The 50 day SMA at 8702 stopped the Dow on the prior bounce

8829 is the late November 2008 peak

8934 is the December closing high

The 50 day EMA at 8936

8985 is the closing low in the mid-2003 consolidation

9200 is the July peak in the 2003 consolidation

9323 From June 2003 peak

9575 from September 2003, May 2001

9654 is the November 2008 peak

Support:

8451 is the early October closing low. Key level to watch.

8141 is the early December low

8197 was the second October 2008 low

8175 is the October 2008 closing low. Key level to watch.

7965 is the November 2008 intraday low.

7882 is the early October 2008 low. Key level to watch.

7702 is the July 2002 low

7524 is the March 2002 low to test the move off the October 2002 low

7449 is the November 2008 low

7282 is the October 2002 low

Economic Calendar

These are consensus expectations. Our expectations will vary and are discussed in the 'Economy' section.

December 23 - Tuesday

Q3 Chain Deflator-Final (8:30): 4.2% expected, 4.2% prior

GDP-Final, Q3 (8:30): -0.5% expected, -0.5% prior

Existing Home Sales, November (10:00): 4.93 expected, 4.98 prior

Mich Sentiment-Rev. , December (10:00): 58.6 expected, NA prior

New Home Sales, November (10:00): 420K expected, 433K prior

December 24 - Wednesday

Initial Jobless claims (8:30): 575K

November Durable Orders (8:30): -3.1% expected, -6.2% prior

Person Income, November (8:30): 0.0% expected, 0.3% prior

Personal Spending, November (8:30): -0.8% expected, -1.0% prior

Crude oil inventories (10:30): 525K prior