Good morning! Despite a slightly higher high in the SP500 on Monday, the market overall held the range bound action I was looking for going into the day. After a strong rally into Friday's close, the new week began with a correction out of the open for the first 30-45 minutes of the day. As the 10:15 ET reversal period hit though, the markets popped and formed small 2-5 minute cups with handles that led to new intraday highs at the 10:45 ET reversal period.

The highs of the range on the 60 minute charts held very well as the indices put in an equal move on the 15 minute charts as compared to Friday's rally. The pace of the upside made for a more gradual correction off highs, but the move was still more rapid than normal and the pace remained steady well into the afternoon. This meant very little opportunity to catch the move on a lower risk setup. The market had a slight base around 12:00 ET as support from earlier lows on the 5 minute charts hit, but the rest was very brief before selling resumed into the 13:00 ET reversal period when morning lows hit in the SP500. That, combined with the reversal period, finally helped the market to put in a bit larger of a correction off the support.

Even though the selling was quite advanced on the 15 minute charts, the market once again only put in a brief correction given the extent of the selling before it continued. We had seen this type of action on Friday over noon as well. At that time it stunted the downside move. It did the same in the NASDAQ on Monday, but the SP500 and Dow, which both had more room to move into larger 15 minute support, were able to put in larger downside moves. Each had three waves of selling on the 2 minute charts until the 15:00 ET reversal period hit at the same time as all three indices came into 15 minute support from the lows of the 60 minute range. This led to another larger correction on the 5 minute charts, but the upside pace remained more gradual into the close.

On Tuesday it is likely that we will see a bit of an upside move in the morning as the market corrects more off the larger 60 minute support. We are seeing rounded highs, however, so the pace can easily turn over and favor more selling into the afternoon. With a lot of economic numbers and earnings out this week I am still not favoring swingtrades at this time. I have VAR from last week and am also watching PX and BCO for buying opportunities, but overall feel that swingtrades at this time will have higher risk.

Economic Reports and Events
July 26: Consumer Confidence for July (10:00 am)
July 27: Durable Orders for Jun (8:30 am), New Home Sales for Jun (10:00 am), Fed's Beige Book (2:00 pm)
July 28: Initial Claims 07/23 (8:30 am), Help-Wanted Index for Jun (10:00 am)
July 29: Chain Deflator-Adv. For Q2 (8:30 am), Employment Cost Index for Q2 (8:30 am), GDP-Adv. For Q2 (8:30 am), Mich Sentiment-Rev. for July (9:45 am), Chicago PMI for July (10:00 am)
Aug 01: Construction Spending for Jun (10:00 am), ISM Index For July (10:00 am)
Aug 02: Personal Income for Jun (8:30 am), Personal Spending for Jun (8:30 am), Factory Orders for Jun (10:00 am), Auto Sales for July (12:00 am), Truck Sales for July (12:00 am)

Earnings Announcements of Interest
Only stocks with an average daily volume of 500K+ are listed. List may not be complete so be sure to always check your stocks' earnings dates before holding a position overnight. (A) = Earnings after the close, (B) = Earnings before the open, (?) = Earnings time not specified at the time of this writing
July 27: APD (B), ACL (A), ATI (B), AGN (B), AHC (B), AMKR (?), BUD (?), APPB (A), AMCC (A), ARRS (A), ARW (?); ACLS (5:00 pm ET), BOL (B), BEAV (B), BC (B), CDN (A), CHIR (?), CLF (A), COGT (A), CL (?), CA (?), CNXT (?), COP (B), CSX (?), DO (B), DRIV (A), DRE (A9, ETS (A), EOG (B), EQR (B), ERES (A), XIDE (?), ESRX (A), EYET (A), FNF (B), FLYI (?), GBN (A), GRMN (B), GW (?), HRS (A), HCA (?), HP (B), HLT (?), IDTI (4:30 pm ET), ISSX (A), K (B), KOMG (B), LPNT (A), LIZ (B), LPX (?), LSI (A), MSO (B), MXO (B), MCK (40:00 pm ET), MWV (B), WFR (A), MCRL (A), MNST (B), NFX (B), NEM (?), NSC (B), OSIP (A), PDG (A), PLUG (B), PX (B), PHM (A), STR (A), RSG (?), RAI (?), ROK (B), RCL (B), FON (B), SBUX (A), SU (B), TROW (?), TE (A), TK (A), TIN (B), BA (B), MOS (B),TMO (B), TRID (A), UPL (?), UMC (08:00 am ET), VAR (A), VTR (A), VRTX (A), WLT (?), WPI (A), WLP (06:00 am ET), WSH (A), XEL (B), XL (A), ZBRA (B), ZMH (A)
July 28: ATVI (A), ADPT (?), AET (B), ALA (B), AYE (B), AEE (B), AMX (A), AXL (B), AFR (B), AMT (B), ANDW (B), ADRX (A), AU (?), APA (B), AZN (06:00 am ET), AN (B), BLL (B), ABX (4:00 pm ET), BZH (B), BOW (B), BMY (?), BG (B), BR (A), BOBJ (A), CCJ (A), CDX (A), CELG (B), CTL (B), CEM (A), CIN (B), CCE (B), CTSH (B), CYH (A), CNX (B), CYTC (B), DENN (A), DHB (A), DTE (A), EMN (A), ELN (B), ECA (?), XOM (?), BEN (B), FMT (B), GTW (A), GMR (B), GNW (A), GGC (A), GP (B), GSK (07:00 am ET), GR (?), GRP (B), HC (B), HPC (B), IM (A), IRF (A), IVGN (A), JNS (B), JAH (B), JNY (B), KGC (A), KLAC (A), KLIC (B), LQI (B), LEXR (A), LOOK (A), LYO (B), MRO (B), MVL (B), MEE (A), MFE (?), MERQ (A), MET (A), MGM (B), MUSE (?), MSCC (A), MSTR (?), TUNE (4:00 pm ET), MLNM (B), NBR (B), NTGR (A), NWL (B), NXTP (B), NI (B), NOC (?), OLN (A), PHS (B), PAAS (B), PRX (B), PTEN (B), PENN (07:00 am ET), PKZ (09:00 am ET), PD (B), PWAV (A), PDS (B), PCO (B), PDE (A), PGN (B), PLD (B), QLTI (B), RTN (B), RGC (B), R (?), TSG (?), SAPE (A), SGI (?), SPIL (A), SPG (B), SOHU (?), STA (B), SYMC (?), SYNA (A), TLM (B), TNE (B), TERN (A), TRA (B), DOW (?), NDAQ (A), VSEA (A), WLP (?), WMI (B), WFT (B), WEBX (A), WEN (?), WDC (A), WFMI (A), XMSR (?), YELL (A)

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.