Good morning! Despite my concerns, the market continued to hold with the prior bias of turning back around quickly after the sharp selloffs like the one on Friday. The blue chips have really led the way, while the Nasdaq has continued to feel a lot more pressure. News from AA, MMM, GM and others pushed the indices higher. The Dow was so strong that it closed positive by more than 100 points. The S&P 500 gained 10.89 points. The Nasdaq Composite rose only 9.50 points.

After gapping higher, the indices continued their rally for the first 30-45 minutes of the day. This brought the Nasdaq into price resistance from Friday afternoon and the S&P 500 into its 5 minute 200 sma resistance. The Dow also hit strong resistance at its 15 minute 200 sma. The 10:15 ET reversal period held and the Nasdaq was soon attempting to close its morning gap, although the S&Ps fell more into a range. It found support at its 5 minute 20 sma, while the Nasdaq hit support at its 15 minute 20 sma support with the 11:00 ET reversal period. The S&Ps and Dow were soon making new intraday highs, but the Nasdaq would end up holding its range for the remainder of the day.

The S&Ps and Dow climbed throughout the remainder of the morning and into the early afternoon as the Dow led the way. It made it all the way back into the congestion at Friday's highs where it found strong price resistance as the Nasdaq came into its 5 minute 200 sma. The momentum turned over into the afternoon when the slower upside pace near highs gave way to a rapid, albeit short-lived drop into 13:30 ET. Even though the downside continued into 14:30, it was not enough to bust the 15 min support levels and the action slowed and turned around to creep higher for the rest of the day.







The market has resistance in the congestion zone from last week along the highs. I am still not convinced that the bulls are going to be able to hang on as well this time though. The slower the momentum back into those prior highs and that upper range, the more difficult it will be to break through it. As a result, I am more in a daytrading mentality this week and will remain so into tomorrow and probably into the weekend as well.

Economic Reports and Events This Week
Monday: -
Tuesday: Treasury Budget for Jan. (2:00 pm)
Wednesday: Trade Balance for Dec. (8:30 am), Retail Sales for Jan. (8:30 am), Business Inventories for Dec. (10:00 am), Crude Inventories 2/9 (10:30 am)
Thursday: Export Prices ex-ag and Import Prices ex-oil for Jan (8:30 am), Initial Claims 2/10 (8:30), NY Empire State Index for Feb. (8:30 am), Net Foreign Purchases for Dec. (9:00 am), Capacity Utilization and Industrial Production for Jan. (9:15 am), Philadelphia Fed for Feb. (12:00 pm)
Friday: Housing Starts and Building Permits for Jan. (8:30 am), PPI and Core PPI for Jan. (8:30 am), Leading Indicators for Jan. (10:00 am), Mich. Sentiment - Prel. for Feb. (10:00 am)

Key Earnings Announcements This Week
Monday: ASF, BRO, CEM, CRK, CTRP, LTR, MEND, NTE, VAL, CEPH, FWRD, HIMX, IRBT, QGEN, RADN, RMKR, SNDA, VECO, and YUM...
Tuesday: EYE, CCE, ENTG, ENZN, KBH, MNTA, NDAQ, OMC, PXR, TEVA, WWE, WYN, MDRX, ANST, AMAT, CCRT, FSLR, FOXH, GPRO, MVSN, NVDA, SPSS, WTW, and XTO...
Wednesday: LEND, KO, DAKT, GRMN, GENZ, JNY, KEA, MGM, ODP, PGN, RIG, ZBRA, BIDU, GES, DISK, NTAP, NTRI, PLAB, RJET, and NCTY...
Thursday: A, BHI, BIIB, BBW, EXPE, FCN, LTM, TAP, ZEUS, POOL, ULBI, AMMD, AQNT, BOBE, BFAM, CAPA, CMG, IM, NANO, NTGR, RADS, and ZGEN...
Friday: ALE, GT, HRL, SJM, SRP, and RNIN.
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.