Several indices registered multi year highs in Friday's session, with the DJIA recording another new all time high at 12556. The S&P 500 now lies within 100 points of its all time high of 1427 reached on March 24, 2000. The Russell 2000 (^RUT) remains marginally below the most recent all time high that was achieved in early December.

The Nasdaq Composite (^IXIC) appears to be entering a rather steep ascending pattern as it continued further into multi-year high territory on Friday. Sentiment seems to be remarkably favorable and the principal factors driving the market include generally positive earnings, the strengthening dollar and the sense that the economy may not be slowing as much as the Treasury market was discounting during early December.

Earnings will continue to be a source of surprises for individual issues but the global liquidity conditions provide a powerful positive dynamic in the overall equation for equities.

The yield on the ten year note touched an important low on December 1 at 4.4% and has moved up decisively since, but is now approaching the 4.85% which could provide near term resistance.

The chart for the exchange traded proxy for the Euro, FXE, highlights the major retracement that has isolated the bullish breakout for the currency that began in late November. The cross rate with the dollar now faces a re-test of the $1.285 level which had acted as resistance previously and could now offer support.

TRADE OPPORTUNITIES/SETUPS FOR TUESDAY JANUARY 16, 2007

The patterns identified below should be considered as indicative of eventual price direction in forthcoming trading sessions.

We cited the basing pattern and positive money flow for Amylin Pharmaceuticals (AMLN) in last Monday's column and during the course of last week the stock gained almost twelve percent.

General Motors (GM) looks vulnerable to further selling as it approaches $32.

Compuware (CPWR) has been under accumulation as it seems to be ready to mount a challenge to the $8.75 level which has confined it for several weeks.

Career Education Corp (CECO) is in a very constricted range and the MFI chart suggests that an upward breakout could be imminent.

The chart for Celgene (CELG) reveals a bearish flag formation and the intersection of the 20- and 50-day EMA's just above Friday's close may prove to be opportunity for the sellers to re-appear.

Lennar (LEN) in the home building sector may struggle to make further upward progress.

Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market. He specializes in market neutral investing and and is currently working on a book about the benefits of trading with long/short strategies, which is scheduled for publication later this year.

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