Good day! This has been a very choppy week for the market. Due to the extreme upside the week before, the market has opted for a more gradual correction off those highs to begin with. This has resulted in a great deal of overlap from day to day accompanied by somewhat lighter volume. There hasn't been much on the data front this week that has attracted a great deal of attention in order to get things moving again.

The homes sales reports this week were perhaps the most closely watched. Wednesday's report showed that sales of existing homes fell further than anticipated and then on Thursday came the news that the sales of new homes also fell short of expectations, dropping by 4.3% in July. The number of unsold homes on the market rose to an 11-year high. In addition to the housing slowdown, new orders for U.S.-made durable goods also fell further than expected, declining 2.4% in July.

The market managed to post gains on Thursday, but just barely. The Dow Jones Ind. Ave. rose 6.56 points to close at 11, 304.46. The S&P 500 climbed 3.07 points to end the day at 1,296.06. The Nasdaq Composite displayed a similar performance, gaining only 2.45 points and ending the day at 2,137.11 While drug stocks, energy, and oil services all climbed higher on the session, many others remained under pressure following Wednesday's selloff. These included retailers, brokers, and transportation stocks.

The day began on a strong note on Thursday, gapping higher into the open. Strong back and forth moves from highs one day to lows the next have been fairly normal in recent months, however, as a reflection of the larger congestion on the weekly charts. The gap was right into the 5 minute 200 sma resistance and the open on the 22nd. This price and moving average resistance held, but the market chopped around a great deal for the first hour of the day before breaking lower. The S&P 500 found support as the gap filled and the market created a 5 minute bear flag that led to continued selling into noon.

The 12:00 ET reversal period is a very common one for mid-day reversals, particularly in this type of market. It is not at all uncommon to see highs or lows of the day made within a minute or so of this time. On Thursday the market moved lower into this time period, but did so rather quickly. When the support hit at intraday lows from the previous session, the market took a bit of time getting turned back over. The 5 minute 20 sma served as initial resistance, but after the market hugged that level for about 30 minutes it began to make its way back to the early morning congestion and back into the 5 minute 200 sma zone. It took a couple of waves of buying to accomplish this feat, but managed with the third move higher on the 5 minute charts. Typically this type of trend move will then correct longer and this took place into the close with the market hugging the 5 minute 200 sma and trading within another choppy channel for the remainder of the session.

Not a lot has changed on the daily charts in terms of market bias since the week began. The downside pace has increased a bit with Wednesday's session, but I am expecting that we just continue this correction off last week's highs as we head into the weekend. As I said a few days ago, folks are just now wrapping up all of their summer vacations and the kids are heading back to school. This can create a lot of distractions that can be seen in lighter trading and a lot more back and forth type of action. I am slightly more on the bearish side at this point heading into early next week, but am cautious against being too heavily invested in that direction following the strength last week.

Economic Reports and Events
Aug. 25: -
Aug. 28: RSTO
Aug. 29: ADCT, COCO, NOVL, SAFM, SMTC, SIGM, LNUX
Aug. 30: JDSU, LTXX, NCS, TIVO
Aug. 31: CHT, CIEN, DG, DLM, HRB, HNZ, JOYG, KWD, OVTI, SYX, TIF, PAY, ZLC
Sept. 1: VIP

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.
Aug. 25: -
Aug. 28: -
Aug. 29: Consumer Confidence for Aug. (10:00 am), FOMC Minutes Aug. 8 (2:00 pm)
Aug. 30: Chain Deflator-Prel. Q2 and GDP-Prel. Q2 (8:30 am), Crude Inventories 8/25 (10:30 am)
Aug. 31: Initial Claims 8/26 (8:30 am), Presonal Income and Personal Spending for July (8:30 am), Aug. Chicago PMI (10:00 am), July Factory Orders (10:00 am), July Help-Wanted Index (10:00 am)
Sept. 1: Aug. Auto and Truck Sales (12:00 am); Aug. Ave. Workweek, Hourly Earnings, Nonfarm Payrolls and Unemployment Rate (8:30 am), Aug. Michigan Sentiment-Rev. (9:50 am), July Construction Spending (10:00 am), Aug. ISM Index (10:00 am)
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.