Good day! The market booked some decent gains again on Tuesday. The Dow Jones Ind. Ave. ($INDU) climbed 52.66 points to close at 11,103.71, the S&P 500 ($SPX) posted an increase of 7.97 points to end the day at 1,268.88, and the Nasdaq Composite ($COMPX) rose 12.06 points to 2,073.90. Nevertheless, this upside came in spurts and was punctuated by its fair share of selling and choppy trading.

The first rally intraday was fueled by the 10:00 economic data. On the home sales front, sales fell by 1.3% in June. This was less than expected, but the inventory of unsold homes rose to its highest levels in nearly a decade. U.S. consumer confidence rose slightly in July, shown by an unexpected gain in the consumer confidence index to 106.5 in July from June's 105.4 level. The rapid surge in the indices generated by the news quickly broke through Monday's highs.

Just as swiftly as the market gained ground, it lost it. The bulls began to second-guess themselves and as that hesitation built, so did the downside. After pulling back to the 5 minute 20 sma, the momentum picked up steam, taking all three of the indices to new intraday lows with a strong exhaustion move on the 1-2 minute charts. The 10:45 ET reversal period held very well as the market retested support from the prior day's trading range and the Nasdaq's 15 minute 20 sma.

Initially it looked as though the market would hug the support zone for a continuation setup on the downside, but the pace within the range remained stronger on the upside than the selling as the morning progressed. After the bounce into the 5 minute 20 sma the indices just couldn't shake that resistance level. When this occurs, it becomes more likely that the resistance will break. This happened with the help of the 12:00 ET reversal period. The break was strong enough to take the market back into prior 5 minute highs, but the range persisted into the latter half of the afternoon.

As the day wore on, the indices began to repeat the morning action on the 5 minute charts, but this time on the 15 minute time frame. Just as the S&Ps and Nasdaq made a slightly lower low into 12:00 ET before breaking the 5 minute 20 sma resistance, the Nasdaq made a similar low on the 15 minute charts and was able to bust the 15 minute 20 sma on a channel break. The S&P and Dow followed the 5 minute of the Dow when they formed their 15 minute patterns, creating a shallow phoenix along the 15 minute 20 sma before they also broke through the resistance.

The initial upside move gained momentum into the last hour of the day after a brief test of resistance around 14:30 ET. The main difference between the 5 and 15 minute versions of this same activity was that the slightly slower downside pace on the 15 minute charts facilitated a more dramatic upside move on the follow through. This second surge of the day took both the S&P 500 and Dow to new intraday highs and back into the congestion from several weeks ago when the strong selling began and brought the Nasdaq back into last week's highs, which had hit again earlier in the session.

The oil sector led the market on Tuesday, putting in a gain of 3.4%. Biotechs, retailers, airlines, and semiconductors also performed very well. Internet and transportation stocks didn't have as much luck. Both declined by 1.8% on the day. Some of the top leaders were MHP, ACL, AGR, ENR, T, MYOG, DXPE, and STTX. Top losers included, UPS, MMM, LM, WAT, NFLX, ZRAN, and NTRI.

The market will continue to remain news-driven as we head into the second half of the week. Many of the oil and energy stocks are looking higher, but I will continue to focus primarily on the intraday action since the larger market remains well entrenched in a trading range. There is a slight upside bias as the market continues to correct to the selloff earlier in the month, but the overall upside pace is still slower overall than the last daily selloff and there is a lot of overhead resistance to contend with that is likely to keep things on the choppy side.

Economic Reports and Events
July 26: Crude Inventories 7/21 (10:30 am), Fed's Beige Book (2:00 pm)
July 27: Durable Orders for June (8:30 am), Initial Claims 7/22 (8:30 am), Help-Wanted Index for June (10:00 am), New Home Sales for June (10:00 am)
July 28: Chain Deflator-Adv. for Q2 (8:30 am), Employment Cost Index for Q2 (8:30 am), GDP-Adv. for Q2 (8:30 am), Mich. Sentiment-Rev. for July (9:50 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 stock's earnings date before holding a position overnight.
July 26: ABY, ACXM, AMG, AEM, APD, AKAM, ATI, ABK, AMX, AHM, AGP, ASCA, AMKR, NUD, APAC, APPB, ARRS, ASH, ASPV, ATMI, AVB, AVX, BIDU, BEAV, BIIB, BSTE, BDK, BOBJ, CDNS, CRS, CBR, CRUS, CLF, CTV, BVN, COP, DVN, CYTC, XRAY, DDR, DO, DRE, ESRX, FILE, FCL, FBN, GDI, GM, GSK, HLIT, HRS, HPC, HES, BLUD, ICE, ISRG, JNY, JLL, KTO, KEM, KMT, KMB, KOMG, LIZ, LSS, LPX, LSI, LU, MTW, MSO, MTSN, WFR, MTH, MCRL, MIL, MNST, MYL, NABI, NETL, NYB, NSC, NVTL, ORLY, OI, PFCB, PD, PLXS, PX, PSYS, PHM, STR, RADS, RAI, ROK, COL, RES, SFNT, SCUR, SIMG, SMDI, SKX, SMSI, SSCC, SNA, SNWL, STTS, SVU, SYMC, TASR, TMX, TIN, BA, FAF, TBL, TMO, TSCO, TRID, TQNT, TTMI, UARM, UNT, VAR, WOOF, VRTX, WEBX, WLP, XL, ZBRA, ZMH
July 27: ARDI, AET, AAI, ALA, AYE, AEP, AMMD, APCC, APC, ANDW, AU, APA, AN, BLL, BZH, BBI, BWA, BSX, BOW, BMY, BC, BG, CCJ, CLDN, CRA, CELG, CENX, CTL, CF, CHK, CCE, CNXT, CNX, CVG, CAM, CMI, DCX, DLX, DENN, DRH, DTE, EMN, ECIL, EQ, EQT, XOM, FORM, FO, BEN, FBR, GMT, GNSS, GNW, GGC, GR, HAE, HC, HET, HIG, HW, HP, HSIC, IKN, HDE, ICO, ISE, SFI, ESI, JNS, K, KLAC, KLIC, LLL, LIFC, LPNT, LYO, MEE, MBI, MFE, MCK, MSCC, MLNM, MHK, MRH, MPS, NOV, NWL, NFX, NEM, NIHD, NOC, ODFL, OLN, OCR, ONNN, OSI, PMTI, PNP, PENN, PKI, PLUG, POT, PDS, PLD, RACK, RRC, RJF, RACK, RNWK, ROP, RCL, R, STD, SI, SWIR, SIVB, SOHU, SNE, SO, SPF, HOT, SPN, TLM, TNE, TLAB, TEN, TEX, DOW, THQI, TDW, UCBH, LCC, UST, VSEA, WHQ, GRA, WEBM, WDC, WITS, XMSR, YRCW
July 28: ALE, AXL, ANDE, ATW, BHI, BDX, BLC, CVX, CEG, CVH, FPL, GPN, IR, ITT, LEA, HCR, ODP, OS, OSTK, SCG, SRP, SSD, TE, WMI
Note: All economic numbers and earnings reports are in lines with those compiled by Yahoo Finance. Occasionally changes will occur that are made after the posting of this column.

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.