Good day! I hope you had a great weekend! Friday was a nice trend day to the downside as the market reacted to the strong daily moving average resistance with the 50 day sma in the SP500 and NASDAQ and 20 sma in the Dow Jones Ind. Ave. The SP500 and Dow began with 15 minute 2T setups as the indices trapped the slightly higher highs, then hugged the 5 minute 20 sma support before breaking lower. The NASDAQ formed the same reversal pattern, but on the 5 minute charts instead of the 15 minute. This led quickly to new intraday lows which continued into the first main support at 10:30 ET. Here the Dow and SP500 hit their 5 minute 200 sma support while the NASDAQ hit its 15 minute 20 sma.

The Dow formed the best continuation pattern late in the morning by hugging the 5 minute 200 sma support. The NASDAQ just slowly kept working its way lower, but the 5 minute 20 sma helped trigger more obvious bear flags in the Dow and SPs, leading to new lows going into noon. At that point the market pace remained on the weak side, with selling stronger as compared to the bounces off support. A longer range, however, helped the market correct more solidly to the morning descent and allowed for a build-up of sellers into the afternoon.

As traders began to come back into the afternoon we saw a very slow upside move on light volume off the 13:00 ET. This created a great short pattern into the 14:00 ET reversal period that took the market again to new lows on the day. This continued with another 5 minute bear flag into the 15:00 ET reversal period after the market corrected again to the selling around 14:30 ET. This final wave to the downside took the indices into strong support at the 15 minute 200 sma in the NASDAQ and SP500. It was also an equal move in the SP500 and Dow as compared to the morning's selloff.

MRK had made new highs yet again and trailing stops can be initiated. DG is another stock worth keeping an eye on for later this week. I want to see it base for a few days on the daily charts to allow for a gradual pullback into the 50 day sma. It has a good shot at creating another strong upside move though. I tried to find some shorts as well, but I still think that risk is pretty high on swings right now and do not see a reason to be too aggressive either way. After Friday's trend day, the odds are also higher for a choppier session on Monday with better odds on pivot trades off support and resistance levels in the indices.

Economic Reports and Events
Apr 11: -
Apr 12: Trade Balance for Feb. (8:30 am), FOMC Minutes (2:00 pm), Treasury Budget for Mar (2:00 pm)
Apr 13: Retail Sales for mar (8:30 am), Retail Sales ex-auto for Mar (8:30 am)
Apr 14: Business Inventories for Feb (8:30 am), Initial Claims 04/09 (8:30 am)
Apr 15: Export Prices ex-ag. For Mar (8:30 am), Import Prices ex-oil for Mar (8:30 am), NY Empire State Index for Apr (8:30 am), Capacity Utilization for Mar (9:15 am), Industrial Production for Mar (9:15 am), Mich Sentiment -Prel for Apr (9:45 am)
Apr 18: -
Apr 19: Building permits for Mar (8:30 am), Core PPI for Mar (8:30 am), Housing Starts for Mar (8:30 am), PPI for Mar (8:30 am)

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 dates 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
Apr 11: DNA (A)
Apr 12: ABT (B), AMTD (B), GCI (?), SOSA (07:00 am ET)
Apr 13: AMD (A), AAPL (?), ASML (02:00 am ET), BBT (B), CBH (B), HDI (B), IFIN (A), LRCX (?), MOGN (?)
Apr 14: CREE (?), DJ (B), ETN (?), EMMS (?), FCS (B), FITB (B), FDC (B), GTK (B), HIB (B), MTG (B), PEP (?), RMBS (?), LUV (B), SUNW (A), NYT (B), UNH (B), VIP (?)
Apr 15: C (B), GE (?), KEY (B), MAT (B), RF (B), TRB (B), WB (B)
Apr 18: MMM (B), BAC (B), CHKP (B), CKR (A), CCK (A), LLY (B), HAS (B), IBM (?), JCOM (A), LNCR (A), MDC (A), NSC (?), NVLS (A), PH (B), PHG (01:00 am ET), STI (B), TXN (4:30 pm ET), UDR (A), WERN (A)
Apr 19: ADTN (B), ASD (B), ASO (B), ARMHY (?), BOL (B), BSX (B), CDWC (?), CHB (A), CHFR (A), CNB (B), CYMI (?), DHI (B), DOV (A), EMC (B), FRX (?), FCX (B), GM (08:00 am ET), GILD (A), ITW (08:00 am ET), RX (A), N (A), INTC (?), JNJ (B), JCI (B), JNPR (A), KFT (A), LH (B), LU (?), MEL (?), MGG (B), NCC (?), NTRS (B), PTV (A), RSH (?), SAFC (?), STX (A), SGTL (A), SGI (?), SOV (A), STT (B), SYK (A), SVU (B), SY (B), TASR (B), TER (A), CAKE (A), KO (B), USB (B), WFC (A), YHOO (?) 

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.