Daily commentary for Wednesday, March 7, 2007

Posted by Teresa
March 6, 2007 at 10:30 pm

Tuesday nice rally across the broader markets. Started the day with a gap up and kept crawling higher all day. Nice market breadth supported the buying and even with that volume was not enough to put in an accumulation day. Volume was lighter than yesterday, which is IÃ¢â‚¬â„¢m sure somewhat disappointing for the bulls, but it was still a nice relief from the red sea of bears.

Economic data for the Week of March 5 Ã¢â‚¬â€œ 9 Wednesday 10:30 Crude Oil Inventories, 01:00 Chi Fed Bank Pres Moskow speaks, 02:00 FedÃ¢â‚¬â„¢s Beige book, 03:00 Consumer Credit, Thursday 08:30 Jobless Claims/Initial Claims, 10:30 Natural Gas Inventories, 12:00 Chain Store Sales, Friday 08:30 Nonfarm Payrolls, 08:30 Unemployment Rate, 08:30 Hourly Earnings, 08:30 Average Workweek, 08:30 Trade Balance, 10:00 Wholesale Inventories.

Some earnings for the week: Wednesday pre market AEOS, BJ, SKS, TLB and after the close FL, FCEL, GDP, MAMA, MW, TIVO. Thursday pre market DIET, FS, GG, TOPT, URBN, OATS and after the bell COO, HOV, ISLE, NSM, SMTC, TRMS. Friday pre market ENCY, BIG.

Going into Wednesday we will find out if this was a one day wonder or the real deal. Given the light volume it is suspect but keep in mind one day means little. Wednesday will either need to find the volume or we will not see this upside continue. I would like to think we look for upside early and then some pullback to see if this is a buying opportunity. Tuesday we held 38.2% supports, which was a big deal. But now the bulls have to work to see if this is real. Indicators tell me todayÃ¢â‚¬â„¢s action was tired into the last 45 minutes and that is a problem. It was not a run away train strong close, it was a fight to hold on and not pullback. Even though IÃ¢â‚¬â„¢d like to think we see early strength, that doesnÃ¢â‚¬â„¢t mean we will. So for now IÃ¢â‚¬â„¢m pretty neutral with the outlook for early move up, then a retest on a pullback into TuesdayÃ¢â‚¬â„¢s range. At least a drop into 50% should be expected if we start to fall.

Compx (Nasdaq composite) closed +44.46 at 2385.14. Support: 2333.30 (38.2%), 2316.82, 2287.48 200dma, 2272.10. Resistance: 2370.48, 2402.30, 2419.15, 2428.74, 2444.85, 2456.31, 2470.92, 2492.12. Daily chart below