Good morning! The market had a pretty slow day on Monday, starting with the continued correction off Friday's strong selling. It did not take long before the indices fell into a triangle trading range in the morning. The range narrowed, favoring an upside resolution with the more gradual pullbacks going into the 10:45 ET reversal period when the indices broke higher.

After Friday's stronger upside move, the indices switched places. This time the SP500 and Dow Jones Ind. Average were the stronger performers while the NASDAQ lagged behind. This continued the rather large market divergence that we saw on Friday, but overall, once the intraday trading began, all three indices fell in line. The triangle from the early morning didn't break too strongly. It put in an equal move intraday as compared to the move out of the open, but it wasn't really that great. The 11:00 ET resistance held extremely well and the market fell into a very thin range over noon.

The volume over noon was some of the lightest we have seen recently. The highs held very well, but the change in pace to more gradual upside moves was not very favorable to continued upside initially. This changed heading into 13:30 ET when the pace on the upside picked up and the pullbacks off highs slowed. The setups were not the most obvious, but the base at highs broke nicely into the afternoon, continuing the morning correction. This took the indices back into Friday highs and then beyond on a continuation move out of a triangle/breaktout from highs.

Tuesday the SP500 is looking to hold its daily range but the upside intraday is looking to continue. Despite the slower pace, I am not seeing much for shorts other than FON on the daily charts. So, look for intraday buy setups, but the best risk to reward is going to be on shorter, intraday setups on the 15-30 minute charts.

AAP from the $51.88 zone on the 25th is correcting a bit on the daily after two strong weeks. Highs of $55.44. Trailing stop hit for swingtrades. 50 day sma is support for position trade. May 18th earnings. ASKJ long remains of interest. From last week, BBI long is also still of interest. VAR, ALGN and ADTN long all have broken out. VAR and ADTN as short term trades have hit trailing stops and have 20 day sma support for longer term. ALGN has yet to really pick up pace. It needs to hold the 20 day sma zone. UNP and CCU short have both hit new lows. Trailing stops initiated.

Economic Reports and Events
May 17: Building Permits for Apr (8:30 am), Core PPI for Apr (8:30 am), Housing Starts for Apr (8:30 am), PPI for Apr (8:30 am), Capacity Utilization for Apr (9:15 am), Industrial Production for Apr (9:15 am)
May 18:  Core CPI for Apr (8:30 am), CPI for Apr (8:30 am)
May 19: Initial Claims 05/14 (8:30 am), Leading Indicators for Apr (10:00 am), Philadelphia Fed for May (12:00 pm)
May 20: -
May 23: -
May 24: FOMC Minutes (2:00 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 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
May 17: ANF (A), AMAT (4:30 pm ET), BKS (B), BJ (B), BGP (A), DE (B), HPQ (?), HD (B), JCP (?), JWN (A), PNRA (A), SKS (B), SPLS (B)
May 18: AAP (A), BEAS (?), POS (B), FL (A), HOTT (4:00 pm ET), INTU (A), PETM (?), PLAB (?), ROST (08:00 am ET), CRM (A), SNPS (A), TLB (?)
May 19: ARO (A), ALKS (A), ANN (B), ADSK (A), BPUR (B), BRCD (A), CBRL (B), CHRS (A), CHINA (B), CLE (06:00 am ET), GPS (A), SYNC (A), MRVL (A), OPSW (A), PSS (?), SRNA (A), PLCE (B)
May 23: CPB (?)
May 24: CSC (A), GME (B), NTAP (A), SEAC (A), VOD (?), WSM (?)

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.