As expected, the market headed a bit higher on Friday, but the momentum slowed significantly after the strong upside from Wednesday and Thursday. The overall result was a much choppier market as volume continued to decline into the weekend.

Ahead of the open, the Labor Department reported the addition of 94,000 nonfarm payroll jobs in November, while the unemployment rate held steady at 4.7%, slightly under expectations of an increase to 4.8%. In other economic news released later in the session, the University of Michigan reported that consumer sentiment has continued to drop into December, falling to 74.5 from 76.1 last month. This is the second lowest reading since 1992. In the afternoon the Federal Reserve reported that consumer credit rose by 2.3% to $7.7 billion in October on increased credit card debt.

After opening near Thursday's close, the session began on Friday with a trading range. It narrowed as the morning progressed, creating a symmetrical triangle on the 5-minute time frame. The S&P 500 ($SPX) and Dow Jones Industrial Average ($DJI) broke lower out of 10:15 am ET and continued into the 10:45 ET correction period. The selling had been slow and it didn't take much to turn it around. The Nasdaq had remained in its own triangle intraday up until that point, but it broke higher into 11:00 am ET with the S&Ps and Dow.



The market was stronger on the upside, popping into the 5-minute 20 period simple moving average in both the S&P 500 and Dow, while the Nasdaq moved back up nto its opening prices. A small congestion followed as volume declined, creating a bullish pattern into 11:30 am ET. The breakout from this range was one of the strongest moves of the entire session. It took the S&P 500 back to its open, the Dow to its morning highs, and the Nasdaq to slightly higher intraday highs. These resistance zones held at about 11:45 am ET and the market pulled back into the early afternoon for the second time on the 15-minute time frame intraday.



The momentum on the mid-day correction varied from one index to the next. The Nasdaq got off to the most rapid start, but all three indices formed descending triangles. The more narrow range of the S&Ps, however, led to strongest drop in that index around 13:00 pm ET. Both the S&Ps and Dow were able to retest the morning lows on this early afternoon descent, but the Nasdaq only came back into the middle of the morning's range before the downtrend channel on the 5-minute time frame broke higher mid-afternoon.

The market pushed higher with strong upward surges in buying on the 5-minute time frame. The corrections off each high, however, were also rather steep and gained in momentum with each correction even though the rallies were also gaining in momentum. In order to really judge the overall momentum of this afternoon buying, it was necessary to transect the entire upside from about 13:30 to 15:15 ET. The revelation was a slower overall ascent than mid-day. Since most trends form with two or three waves, the third wave of upside into 15:15 ET which took the indices back into upside resistance was the final one of the afternoon, leading to another correction off the highs going into the closing bell.



The Dow gained 5.7 points on Friday, closing at 13,625.6. This was a 1.9% gain on the week. The S&P 500 lost 2.68 points, finishing the session at 1,504.66, or a 1.6% gain on the week. The Nasdaq Composite also fell slightly on the session as a whole after new highs on the week. It shed 2.87 points and closed at 2,706.16. This was a weekly gain of 1.7%.

Although the market as a whole didn't get very far on Friday, there were still some rather significant gainers and losers on the day. These included Macrovision Corp. (MVSN), which fell 5.55 points, or 21.3%, after announcing its plans to buy Gemstar-TV Guide Intl. (GMST). GMST fell nearly a point, losing 16.6%. Palm Inc. (PALM) also had a rough session, losing 0.85, or 12.9%, after Thursday's afternoon announcement of net losses for this last quarter. American Express Co. (AXP) was another top loser, falling 2.57 points, or 4.3% following a downgrade by Merrill Lynch. Amgen Inc. (AMGN) lost 3.05, or 5.5% on news of discussions regarding its drug Aranesp with the Food and Drug Administration. News was released on Saturday stating that its Romiplostim study met its goals, so this is something to watch again on Monday for more volatility.

On the winning side of the market were names such as Freeport-McMoran Copper & Gold (FCX), Penney JC Inc (JCP), Bear Stearns (BSC), Suntech Power Holdings Co (STP), United States Stl Corp. (X), Apple Inc. (AAPL), Imax Corp. (IMAX), First Solar Inc. (FSLR), Synopsys Inc. (SNPS), and JA Solar Holdings Co Ltd. (JASO).

The main news event of this upcoming week is going to be Thursday's FOMC meeting. A rate cut is highly anticipated, but I suspect that we are going to primarily experience a trading range this week with a great deal of overlap from one day to the next over the next couple of days unless the Fed does something completely unexpected. This should make intraday pivots and reversals favorable setups for trading.

Toni Hansen is President and Co-founder of the Bastiat Group, Inc., and runs the popular Trading From Main Street. She can be reached at Toni@tradingfrommainstreet.com.