主题：1/4/2009 Market View -- 宁子

Commodities and company led the market Monday, continuing their rally while a lot of the recent leaders that got things started were flat to lower. Good rotation in the market is what you like to see. There were no major breakdowns and an orderly pullback by some of these stocks to test near support can give us a good entry as the rebound along with the indices after they make this test of last week's break over the 50 day EMA as well as the higher high hit on this rally.

Monday we saw nothing to dissuade us from the position that the market has started a solid rally after growing some backbone in early December along with a wider swath of leadership. Small caps were down, but as noted above, they made a good orderly test of the break over the 50 day EMA just as did the other indices. That puts them in good position to rally again and give us some entry points as well.

The indices might test some more as the new year settles in. Of course you want to see more of the same orderly testing and not a surge of selling volume that pushes the indices down and gives back the ground won, at least not in a big selling swell. Orderly pullbacks with leaders holding support is what you want to see. That sets up the next move higher. It would be really nice to see the indices hold most of this move, basically over the higher high and the 50 day EMA on a closing basis and then surge higher again. That would show increasing strength in the rally as more investors come back to work after the holiday season.

The market still has to show us its real colors for the new year, but as noted, the initial trade is positive. Thus we are continuing to look for opportunities off of this test to catch solid stocks in good position to rally higher. As noted last year (okay, a couple of weeks back), a rally up to the early November peak on the indices is a significant move to significant resistance. That will require a re-evaluation of the rally and the market overall at that point, looking at the upside volume and leadership for example. It may die at that point, it may surge more. Up to that point, however, we have some great positions that are making us money and will do so on that rally, and we are going to pick up some more along the way to ride to that point once this pullback/test runs its course.

Support and Resistance

NASDAQ: Closed at 1628.03

Resistance:

1644 from August 2003

1752 from 2004

The 90 day SMA at 1771

1782 from August 2004

1786 is the November 2008 high. Key level.

1948 is the early October 2008 gap down level

Support:

1620 from the early 2001 low

The 50 day EMA at 1609

1603 is the December peak

The 10 day EMA is 1571

1565 is the second low in October 2008

The 18 day EMA at 1556

1550 is the 50 day SMA that stalled NASDAQ last week

1542 is the early October 2008 low

1536 is the late November 2008 peak

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

S&P 500: Closed at 927.45

Resistance:

965 is the 2003 consolidation low

995 from June 2003 consolidation peak

The 90 day SMA at 996

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:

919 is the early December peak

The 50 day EMA at 916

899 is the early October closing low

The 10 day EMA at 898

896 is the late November 2008 peak

The 18 day EMA at 890

889 is an interim 2002 peak

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

Dow: Closed at 8952.89

Resistance:

8985 is the closing low in the mid-2003 consolidation

9200 is the July peak in the 2003 consolidation

9323 From June 2003 peak

The 90 day SMA at 9444

9575 from September 2003, May 2001

9654 is the November 2008 peak

Support:

8934 is the December closing high

The 50 day EMA at 8867

8829 is the late November 2008 peak

The 10 day EMA at 8733

The 18 day EMA at 8680

The 50 day SMA at 8651

8626 from December 2002

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

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.

January 5 - Monday

November Construction Spending (10:00): -0.6% actual versus -1.4% expected, -1.2% prior

January 6 - Tuesday

November Factory Orders (10:00): -2.6% expected, -5.1% prior

ISM Services, December (10:00): 37.0 expected, 37.3 prior

January 8 - Thursday

1/03 Initial Jobless Claims (8:30): 550K expected, 492K prior

Consumer Credit, November (2:00): $0.5B expected, -$3.5B prior

January 9 - Friday

December Average Workweek (8:30): 33.5 expected, 33.5 prior

Hourly Earnings, December (8:30): 0.2% expected, 0.4% prior

Nonfarm Payrolls, December (8:30): -475K expected, -533K prior

Unemployment Rate, December (8:30): 7.0% expected, 6.7%

Wholesale Inventories, November (10:00): -0.9% expected, -1.1% prior