Good morning! The bulls reined supreme in Wednesday's session, pushed higher by positive news. The tech sector, which has been under a lot more pressure compared to the overall market lately, received a boost by strong earnings from Applied Materials Inc. (AMAT). This gapped the Nasdaq strongly higher, opening into resistance at the 15 minute 200 sma. The Dow and S&Ps had a small gap and all three fell into a narrow trading channel until the business inventories at 10:00. Fed Chairman Ben Bernanke did a great job of getting the bulls all stirred up again when he spoke of easing inflation and the indices shot higher.

The extreme morning momentum took a lot of the steam out, making it difficult to maintain the pace as the day progressed. The indices still pushed higher throughout the session, correcting only briefly each time before making new highs. There was a bit longer congestion over noon when the indices formed shallow 5 minute cup with handle formation, again moving higher into the second half of the afternoon. The pace slowed significantly at that time, however, and the Nasdaq was unable to make new highs in the final two hours of trading while the Dow and S&Ps hugged the 5 minute 20 sma support before breaking it in the final 30 minutes of trading.

By the end of the session, the Dow Jones Ind. Average had tacked on 87.01 points (+0.7%), the S&P 500 gained 11.04 points (+0.8%), and the Nasdaq Composite rose 28.50 points (+1.2%). Among the top gainers on the day were ACS, which gapped higher after earnings, rising 5.9%, CORI, upon news of its acquisition by CKFR (+44.9%), CSX (+6.9%) due to a stock buyback, and DCX on profit news and restructuring. Other leaders included DE, DTG, FVRL, FSLR, GRMN, HGR, IVGN, KRSL, MNSN, PFCB, SPSS, VSEA, and WOS. Top losers were FLWS following a downgrade, AVNX, CRI after fourth-quarter earnings, CHH, DAKT, GPRO, GIFI, KCI, VION, WTS, and WTW.







Thursday's another busy day on the data front. Wednesday's strength has turned the momentum around in the Nasdaq Composite and it this range now breaks higher coming off the 20 week sma that is hitting then it has quite a ways that it can move. I'm not committed to it yet, but most of the setups I've taken in recent weeks, despite my added concerns, have still been on the long side other than a couple of daytrades.

On those short time frames intraday the market is again at resistance, hitting the prior daily highs in the Nasdaq and equal move resistance on the 15 minute charts on the rally from Wednesday as compared to the one into the day on Tuesday, so some intraday slowing is something to watch out for on Thursday and particularly into Friday due to the three day weekend. I'm actually going to be done trading for the week tomorrow since I'll be heading to NYC for the trading expo. I'll be back on Wednesday, so happy trading until then! Please remind whoever is in charge of the weather that I would appreciate a warm front please! (Ok... that might be asking for too much right now... but I figured it might be worth a shot!)

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.