Good morning! I had a rather exciting weekend this weekend. One minute I'm out in the sun enjoying myself and the next I'm on my way to the urgent care center after having been stung by a wasp for the first time in my life. Luckily no one had a camera since I looked like one of those bumpy Halloween gourds doused with cranberry sauce before the shots started kicking in. I'll probably look better when I'm 90 than I did yesterday! Obviously, it is pretty unlikely I will be paying much attention to the market tomorrow, but hopefully it will be a good trading day.

I found Friday's to be a bit difficult and ended up slightly down on the day. While we did get that correction I was looking out for heading into the day, it didn't offer very great continuation patterns and we saw lot more overlap as the correction from highs proceeded into the close. The morning began as the indices teased their trend channel support from the prior two trading days, hugging the 15 minute 20 sma before giving way coming out of 10:00 ET. The pace was steady on the downside, but the prices overlapped quite a bit on the way lower.

The first support hit as the NASDAQ came into the prior day's lows and then the 5 minute 200 sma at the 11:00 ET reversal period. Due to the stronger selling in the NASDAQ, I began to look for a 15 minute base over noon for a continuation lower into the afternoon. It broke much more quickly than I would have liked, however, selling off again after only about a 30 minute reprieve. It continued until 12:30 ET before spiking quickly into the 5 minute 20 sma.

With the change in pace out of the 12:30 ET lows, it was looking like we would finally see a larger intraday correction. I first began to look for a 5 minute Phoenix , but the pattern broke too early in the NASDAQ, hence hitting the 5 minute 200 sma quickly and pulling back in. This made for a double bottom intraday in the SP500 and Dow Jones Ind. Ave. before the correction off lows continued into 14:30 ET. I didn't see a good opportunity to really catch it since the move into the second low on the 5 minute chart was faster than the first drop and hence higher risk as a pivot trade.

All in all, this trend for earlier than usual setups and more varying pace continued into the close. As we went into the last hour and a half of the day, I called it a week for that reason. I do see in hindsight one opportunity around 15:00 to have taken another index trade. This occurred after the market pivoted off afternoon highs and pulled into the 5 minute 20 sma. There it began to base with a volume decline, thus indicating a likelihood that the support level would give way. It offered a short setup when that support broke and it took the indices back to morning lows and then some in the SP500 and Dow.

The market is looking lower going into Monday, but that middle of the range from the last two weeks is going to be strong support, so I think things are going to be pretty choppy for a few days. I have not been finding much at all on either the long or the short side for daily patterns, and that makes me more cautious.

Updates: VAR from last the 20th $38 around hit new highs the 27th at $40.09 before closing on the day with a base at highs ahead of earnings for swingtraders. For a larger position trade the weekly is still looking nice and I want the 20 week sma to hold as support. BCO is no longer of interest at this time. I will check back on it in a week or two. I will be watching NEW for an upside breakout on the daily charts.

Economic Reports and Events
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)
Aug 03: ISM Services for Jul (10:00 am)
Aug 04: Initial Claims 07/30 (8:30 am)
Aug 05: Average Workweek for Jul (8:30 am), Hourly Earnings for Jul (8:30 am), Nonfarm Payrolls for Jul (8:30 am), Unemployment Rate for Jul (8:30 am), Consumer Credit for Jun (3:00 pm)
Aug 08: -
Aug 09: Productivity-Prel for Q2 (8:30 am), Wholesale Inventories for Jun (10:00 am), FOMC policy announcement (2:15 pm)

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
Aug 01: BRKS (A), CECO (?), ETR (B), EOP (A), GPRO (A), GGP (?), HUM (05:00 am ET), LNC (A), MVSN (A), MMC (?), MXIM (A), OIS (A), PEG (B), SBAC (A), PFG (A), TWTC (A), UCL (?)
Aug 02: CTAC (A), AOC (A), AUO (8:00 pm ET), BMC (A), BORL (?), CDIS (A), CEPH (A), CHTR (B), COH (B), CMCSA (?), CVH (B), CCI (A), EMR (?), INCY (?), IACI (B), MAS (?), MBI (?), NTES (9:00 pm ET), PXD (B), PPL (B), PRTL (A), PDLI (A), KWK (A), Q (B), RNWK (?), RDC (B), SRE (?), SIRI /B(, SBL (?), THC (?), RIG (B), TXU (?), TYC (B), UNTD (A), UNM (A), UTSI (A), VPHM (A), VSH (?)

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.