Good morning! After an intense wave of buying last Thursday to kick off end of the year, the market slowed once more on Friday. Before the open the jobs data for Nov. was released. They were in line with expectations and had little impact on the market. U.S. nonfarm payrolls rose by 215,000 in November, while the unemployment rate remained at 5%. Total hours worked, however, fell 0.1% with the average work week dropping to 33.7 hours.

The morning began with a slight downside gap following the news. It was easily filled coming off of the first reversal period of the day at 9:45 ET. It was here that we saw the relative strength in the NASDAQ come through that we were looking at heading into the day. This initial pivot off intraday lows took that index to new highs for the week, but it stalled as both the S&P500 and Dow Jones Ind. Ave. came into price resistance from Thursday highs. This led to the second pivot of the day around 10:30 ET, which confirmed with a shooting star candlestick pattern circled on the 5 minute NASDAQ chart below.

The NASDAQ continued the trading range that began with these first two intraday reversals throughout the remainder of the day as volume declined into the weekend. The selling stalled for the second time as the 11:00 ET reversal period hit with the NASDAQ at its 5 minute 20 sma support and the Dow retesting morning lows. This time the reaction was not as swift. The market consolidated on the 2-5 minute charts, hugging the 5 minute 20 sma in the NASDAQ and the 5 minute 200 sma in the Dow. This created an Avalanche in the NASDAQ when the support gave way coming out of the 12:00 ET reversal period and took that index back to support from the morning lows while the Dow, which was the weakest of the three, fell into Thursday's lows.

With the onset of the 13:00 ET reversal period and the numerous support levels converging intraday, the market once more reversed. It began well and then became more choppy beginning at about 13:30 ET. This choppy action persisted until the 15:00 ET reversal period when the market began a steady upside move from the lower end of the range. The NASDAQ was able to close near the day's highs, while the S&P500 ended the day near the middle of its range. The Dow remained the weakest, closing only slightly off lows.

My thoughts on the market haven't changed much over the past several trading days. Going into Monday we have a range bound bias intraday into the open, which can most easily break higher. I would like to see a longer daily consolidation though, so I am still using greater caution on new longs at this point and my focus will be more on daytrades. I am still finding primarily longs on the daily and weekly charts, but most of the stocks could do with more of a break from the prior buying to allow for stronger upside continuation patterns on the larger time frames.

Economic Reports and Events
Dec. 05: ISM Services for Nov. (10:00 am)
Dec. 06: Productivity-Rev. for Q3 (8:30 am), Factory Orders for Oct. (10:00 am)
Dec 07: Crude Inventories 12/2 (10:30 am), Consumer Credit for Oct. (3:00 pm)
Dec 08: Initial Claims 12/03 (8:30 am)
Dec 09: Mich. Sentiment-Prel. for Dec (9:45 am), Wholesale Inventories for Oct. (10:00 am)
Dec 12: Treasury budget for Nov. (2:00 pm)
Dec 13: Retail Sales for Nov. (8:30 am), Retail sales ex-auto for Nov. (8:30 am), Business Inventories for Oct. (10:00 am), FOMC policy announcement (2:15 pm)

Earnings Announcements of Interest
Only stocks with an average daily volume of 500K+ are listed. List may not be complete so be sure to always check your stocks' earnings date before holding a position overnight. (A) = Earnings after the close, (B) = Earnings before the open, (?) = Earnings time not specified at the time of this writing
Dec. 05: CMGI (A), CAO (A), HERO (B), JOSB (B)
Dec. 06: AZO (B), BRCD (B), CMVT (A), NUAN (A), SHLD (B), KR (?),
Dec. 07: HOV (A), PLL (B)
Dec. 08: COST (?), CMOS (?), FLE (B), NSM (?), TOL (B)
Dec. 09: PPHM (B)
Dec. 12: COO (A),
Dec. 13: ADCT (A), BBY (?), MATK (A)

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.