Good day! The market had a tough time on Wednesday as it dealt with multiple news events beginning with a disappointing start to earnings season. Alcoa Inc. (AA) opened sharply lower, losing up to 6.7% at one point when it's third-quarter earnings fell short of expectations. Genentech Inc. (DNA) also opened significantly lower after disappointing sales from many of their top drugs even though it had a 58% increase in Q3 net earnings. The impact led to a sharply lower open in the overall market. The gap was much larger than average. Such gaps in individual stocks will hold much better than in the indices themselves, which tend to become over-extended and will most often attempt to fill the gap.

Even though the market put in a steady trend throughout the morning, working hard to take back the ground it lost, the indices experienced a comparable level of choppy trading as seen over the past week. The buying contained a number of flushes to the lower end of the trend channel and a great deal of overlap in prices from one bar to the next on all of the intraday time frames. The setups were not clear-cut, but the resistance and support levels still held very well throughout the upside move. The rally finally came to a close with the 13:00 ET reversal period when the S&P 500 and Dow Jones Industrial Average closed their gaps. The Nasdaq Composite had hit that milestone earlier in the day, but it came into resistance as well at that time when it retested the prior two days' highs.

While the market held its larger intraday and daily resistance within a few ticks, the volume declined as the indices began their correction. Many traders began to move to the sidelines ahead of the 2:00 ET FOMC minutes. Over the course of the last year we have seen a much stronger reaction to this release than in the past as investors monitor it closely for an indication on the Fed sentiments regarding any changes in the overnight lending rate. The market took a tumble with the indication that the Fed still felt that inflation remains a risk and sentiment towards the possibility of an upcoming rate decrease fell.

While the Fed release took the market back into earlier congestion from the open in both the S&P 500 and the Nasdaq, closing in on the morning lows with a continuation pattern just before 14:30 ET, still more news shook the market when it quickly became known that an aircraft hit a high-rise in New York. This sent the indices rapidly into their 15 minute 200 simple moving average support levels and back into the lower end of the daily trading range, as well as 10 day sma support before they managed to begin a recovery. The single-engine plane's owner, Yankees Cory Lidle, along with a passenger, were killed in the crash. Once it became apparent that terrorism was not involved, the market pulled hesitantly higher into the last hour of the day. The S&P 500 and Nasdaq Composite closed near their open. The S&P 500 lost 3.47 points on the day, while the Nasdaq closed lower by 7.16 points. The Dow lost 15.04 points.

Economic Reports and Events
Oct. 12: Initial Claims 10/07 (8:30 am), Trade Balance for Aug. (8:30 am), Fed's Beige Book (2:00 pm)
Oct. 13: Export Prices ex-ag, Import Prices ex-oil, Retail Sales, & Retail Sales ex-auto for Sept. (8:30 am), Michigan Sentiment-Prel. for Oct. (9:50 am), Business Inventories for Aug. (10:00 am)
Oct. 16: NY Empire State Index for Oct. (8:30 am)
Oct. 17: Core PPI and PPI for Sep. (8:30 am), Net Foreign Purchases for Aug. (9:00 am(, Capacity Utilization and Industrial Production for Sep. (9:15 ET)
Oct. 18: Building Permits, Core CPI, CPI, and Housing Starts for Sept. (8:30 am), Crude Inventories 10/13 (10:30 am)
Oct. 19: Initial Claims 10/14 (8:30 am), Leading Indicators for Sept. (10:00 am), Philadelphia Fed for Oct. (12:00 pm)
Oct. 20: -

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.
Oct. 12: COST, GENZ, JRC, MTG, PEP, PII, SWY, WGO
Oct. 13: FNFG, GE, PKX, RF
Oct. 16: CBH, CCK, ETN, MI, MAT, PPDI, PHG, SONC, TMA, VCP, GWW, WB
Oct. 17: ADTN, ASD, ASO, BOT, CHTR, CSX, EMC, FRX, GAP, HWAY, ILMN, INTC, IBM, JEF, JNJ, KEY, LLTC, MER, MOT, NCC, NVLS, ODP, PKG, SOV, STT, SYK, STI, UTX, WFC, YHOO
Oct. 18: ABT, ADS, AMLN, AAPL, ASML, BSX, COF, CDWC, CIT, CTXS, CNB, CBSS, CBST, ET, EBAY, GD, GPC, ITW, RX, ISIL, JPM, JNPR, KEA, LHO, MEL, MOGN, MGI, NTRS, NCX, JNC, NVEC, OXY, PH, PLCM, RDN, RJF, RYL, SEIC, SSTI, SON, SPSN, STJ, SNV, TCB, TER, ALL, WM
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.