Good morning! The market took back all of Thursday's gains on Friday. The Dow ($DJI) closed lower by 49.27 points, while the S&P 500 ($SPX) fell 5.33 points, and the Nasdaq Composite ($COMPX) lost 6.04 points. The broker/dealers were among the worst hit on the session. Banks also felt the pressure though. Some of the stocks leading the selling were GS, LEH, VRTX, ERTS, and HES. There were still some pockets of strength, however, and some of the top gainers on the day were PSUN, CERN, CSX, and ANN.

Friday did not start out too poorly. The indices had a slightly bullish bias within the trading range from Thursday and this followed through on the upside shortly after the open, but the overall move was a choppy one. Once the indices hit prior highs on the 15 minute at the highs of the range, they stalled, so that even though the upper trend line had broken from Thursday's correction, the larger pattern did not. The market rounded off into 10:30 ET and steady selling hit. It was not the most steady move on the 5 minute charts, in that there was quite a bit of overlap within the downtrend channel intraday, but it was still a strong one. The smaller support levels didn't hit until the indices were back at the lower trend channel from the previous day's range.

The momentum within the selloff in the latter half of the morning increased slightly as the trend progressed. It slowed between 11:15 and 11:45 ET and the indices were testing the upper trend line from the downtrend channel by the time the 12:00 ET correction period hit. It broke shortly thereafter, but trading remained choppy throughout the rest of the session. The Nasdaq experienced the strongest price correction into the early afternoon, while the S&P and and Dow could not break their 15 minute 20 simple moving averages which were closely overhead and kept the indices in more of a trading range. Those ranges broke lower into 14:00 ET, but trading remained very choppy.







The market is likely to remain choppy early this week due to Wednesday's upcoming Fed announcement. The market is wedged between support and resistance with a lot of faster moving averages overhead, such as the 20 and 100, which are the closest, and the 200 sma serving as support directly under the current daily range. The market has plenty of room to move intraday in either direction, however, before either that upper or lower resistance or support is tested. At present the pace within the range of the past two trading days is a bit more on the bearish side despite the indices moving higher in after-hours trading going into the wee hours of Monday morning.

On a side note, I'm going to be out of town over the next couple of days, but will resume this column before Friday's session. Have a wonderful trading week!

Economic Reports and Events This Week
Monday, March 19, 2007
12:00p.m. Jan Chicago Fed Midwest Mfg Index. Previous: +0.3%.
1:00p.m. Mar NAHB Housing Market Index. Previous: 40.
Tuesday, March 20, 2007
7:45a.m. ICSC Chain Store Sales. Previous: +0.7%.
8:30a.m. Feb Housing Starts. Previous: +0.2%.
8:55a.m. Redbook Retail Sales Index. Expected: +5.1%. Previous: -14.3%.
5:00p.m. ABC/Wash Post Consumer Conf. Previous: +2.
N/A Two-Day FOMC meeting begins.
Wednesday, March 21, 2007
7:45a.m. MBA Refinancing Index. Previous: +3.5%.
2:15p.m. Two-day FOMC meeting continues, interest rate decision expected.
Thursday, March 22, 2007
8:30a.m. Initial Jobless Claims. Previous: -12K.
10:00a.m. DJ-BTMU Business Barometer For Mar 10. Previous: -0.2%.
10:00a.m. Feb Conf Board Leading Econ. Indicators. Expected: -0.3%. Previous: +0.1%.
Friday, March 23, 2007
10:00a.m. Feb Existing Home Sales. Expected -2.0%. Previous: +3.0%.

Key Earnings Announcements This Week
Monday: MOVI, NT, and COSI.
Tuesday: CAMT, CRZO, CMC, FDS, MCS, PERY, PRGS, SUP, ADBE, CHAP, CTAS, DRI, FSII, and ORCL.
Wednesday: AIR, CHRS, DIET, MS, ROST, SMRT, CTRN, CLC, MLHR, IHS, and SIGM.
Thursday: BKS, BBA, CTR, CHTT, CAG, CRAI,EBS, FDX, FRED, GIS, KBH, NWY, SCHL, TWP, WSM, COMS, BGP, CPWM, JBL, NKE, NINE, PALM, SRSL, and SNX.
Friday: No earnings are currently scheduled
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.