Good morning! While trading was slow and choppy on Friday, it was even more so as the new week began. The market seemed a little startled in the morning, as if an alarm clock had been going off, but after continuing to hit the snooze button several times, it finally unplugged it completely and went back to bed.  For the last couple of months, the overall momentum in the market has waned, particularly in the Nasdaq Composite. Now that earnings season is winding down and there is little on the economic front, the market had a difficult time mounting any strong directional bias on Monday.

Monday began with another divergence between the tech-laden Nasdaq on the one hand and the oil and energy riddled S&Ps on the other. Although all three of the major indices gapped down slightly into the open, the Nasdaq quickly shot higher off the lows, attempting to retest last week's highs, but falling a bit short of them when the resistance from the S&P 500's prior 5 minute held. The selling was rather sharp off this resistance and the market was soon breaking through the morning lows. The sellers were unable to bust the trading range, however, and strong support hit at the 10:15 ET reversal period. Prior congestion in the Nasdaq, prior lows in the Dow and prior lows and 5 minute 200 sma support in the S&P 500 all conspired to turn the indices back over one more time.

The market again found resistance shortly before 10:45 ET. The S&Ps were hitting prior 5 minute highs and the 15 minute 20 sma, the Nasdaq was at Friday's highs, and the Dow hit 15 minute highs from Thursday as well as Friday of last week. This time around, however, the momentum had increased somewhat on the upside and the correction off the resistance was much more gradual than before. I had picked the S&Ps to short and was lucky to get a gain on a scalp before the market range narrowed over lunch. The pace soon started to favor an upside breakout, which the market attempted around 12:30 ET, but the breakout was unable to gain any strong followers and the indices had pulled back into the range by the time the 14:00 ET reversal period hit.

The volume remained light throughout the rest of the afternoon, offering very little in the way of low risk setups intraday. Even though the market attempted to move higher again, the 15:00 ET reversal period held when the indices again came into price resistance at prior highs. My lack of a strong market bias was well-rewarded. I was able to still find some nice setups intraday in both directions. On the upside, CTSH, AKAM and DECK offered strong continuations, while AVID resumed a nice selloff after Friday's gap. There were a lot of other stocks which also had magnificent price action intraday. Some of the most widely followed were RMBS, ANAD, HC, UCO, GROW and MLS on the upside and GOOG, ILMN, SLM, STT and RCL on the downside.

The overall market is still rounding off intraday on the 30-minute charts, so I don't have a great bias for Tuesday since the pace within this range intraday has not yet begun to really favor one end over the other, but rather acts like it will pull back gradually and continue with the larger range.







Economic Reports and Events This Week
Monday: ISM Services for Jan. (10:00 am)
Tuesday: -
Wednesday: Productivity - Prel. for Q4 (8:30 am), Crude Inventories 2/2 (10:30 am), Consumer Credit for Dec. (3:00 pm)
Thursday: Initial Claims 2/3 (8:30 am), Wholesale Inventories for Dec. (10:00 am)
Friday: -

Key Earnings Announcements This Week
Monday: ATRS, CTSH, HERO, HUM, IPS,OSTK, PMI, APC, BLKB, EW, IKAN, LVS, QSII, RCII, SOHU, TZIX, and WMS
Tuesday: ADP, RATE, ELNK, IACI, ISE, LFUS, NOOF, TYC, WWY, ACTS, CELL, BOBJ, CAKE, CSCO, XRAY, WIRE, GCOM, IVAC, RENT, TWTC, and TZOO
Wednesday: ARXT, DTV, NRGY, ICE, MEDI, NSW.A, OSIS, SNWL, AKAM, ACL, ROCK, MOGN, PACR, and DIS
Thursday: AUO, CSK, CXW, DO, ESRX, FLIR, RAIL, GCA, LCLT, MGAM, PMTI, PENN, PEP, Q, RAI, TRB, WMI, KAR, BMC, BRCM, CSTR, DRIV, DIVX, DRRX, EQ, ITMN, LPNT, NAPS, NEW, PNRA, PWAV, SIMG, SPRT, and VSTA
Friday: ALU, CVH, MA, NNI, QMED, WY, and WLSC
Note: All economic numbers and earnings reports are in lines with those compiled by Yahoo Finance and Briefing.com. Occasionally changes will occur that are made after the posting of this column. This list is not a complete list of earnings, so always double check your positions!

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.