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S&P 500

Today is the 7th trading day of August and the market has held up well however today is the FOMC Announcement so anything can go. After the Nonfarm payrolls fell by 131k last month, traders and investors are looking for the Fed will need to ease policy to stimulate the economy. Some of these measures include the Fed buying Treasuries and postponing any sales of its balance sheet assets. However the concern over deflationary pressures is a concern for the Fed.

According to the Stock Trader’s Almanac, the S&P was up only twice in the last 13 years and the first nine trading days are the weakest of the month. Historically it is the weakest month of all seasons as many institutions, investors, and traders are away during the month of August on vacations before their children go back to school in September.

Beware of rallies as the middle of August seems to be stronger than the beginning and the end according to the Stock Trader’s Almanac. Traders seem to sell before the weekend and follow the direction of the foreign markets after they trade on Monday. China brought the Asia markets lower pushing the dollar higher against all major currencies.

Yesterday the market broke through into the January 2010 resistance level. Last week the markets had a hard time breaking through the 1125 resistance level which begins the January 2010 resistance levels. Whether the markets can hold on to this level is another story only to be determined after the FOMC announcement. Not enough volume is expected during the summer months to push the markets above this level especially during the month of August. However with global economy expecting slowdown foreign economies see safety within the US markets.

On the daily chart of the S&P 500 we were trading between the cushion area of 144 and 200 day moving averages as traders and investors are cautious looking ahead especially with the upcoming mid-term elections, uncertainty with European debt, and the current Gulf Oil Spill. Now we have slowly broke out of this area after the European banks passed the stress tests. However as we have stated before the markets will remain trading below the January 2010 resistance levels which begin at 1125.

The Market Volatility Index (VIX) has been active due to the seasonal selling trend of the ‘Sell in May’ philosophy however seems to stabilizing after the Fourth of July weekend and the anticipation of second quarter 2010 earnings season. Currently the VIX trading below the 144 and 200 day moving averages indicating more risky approach towards investments and assets.

The Chicago Board Options Exchange (CBOE) Market Volatility Index measures options activity within the market and is widely used tracking the S&P 500. A common trading strategy for traders and investors includes a VIX level of 30 or above means an immediate switch from equities to cash. Traders and investors are retreating from the markets and finding safety and protection within the Treasuries, gold, and the dollar when the index is trading above 30.

Summary of Major S&P Pivot Levels

1219: S&P 500 52 Week High

Technical Levels Natural Support and Resistance

1125: January 2010 Resistance Level

1100: Natural Support Level

Technical Levels 15 Minute Chart

1120: 144 Day Fibonacci Moving Average on 5 Minute Chart

1118: 200 Day Moving Average on 5 Minute Chart

Technical Levels Daily Minute Chart

1102: 144 Day Fibonacci Moving Average on Daily Chart

1091: 200 Day Moving Average on Daily Chart

Daily Economic Calendar

FOMC Announcement / 14.15 EST

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- About the Author: Shamim Ziyaaudhin is one of the editors of TraderMongers.com a one stop trading news feed source for worldwide traders and investors. Their philosophy is to establish the standard for providing market news feed that is comprehensive, accurate, and concise. Providing technical and fundamental trading setups, economic numbers, and calendar events throughout the trading day. Shamim has a Masters in Business Administration from Fairleigh Dickinson University and holds a degree in Psychology from Rutgers University. Click here to subscribe to Tradermongers Live News Feed Article Source

Summer Friday and GDP is slighly worse than expected and the economy grew slower, thats not really a shocker, as we digst earnings.  Lets face it Q3 can be a bore and all we really wait for is the Football Season and hope to avoid a market sell off in October.  On this Friday the best thing to do is head to weekend thinking and avoid closing on the lows for the day.

(AP) — Stocks fell and interest rates rose in the Treasury market Friday after the government said the economy grew at a slower pace than expected during the second quarter. The Commerce Department said the gross domestic product, the broadest measure of the economy, grew at an annual pace of 2.4 percent from April to June. That’s less than the 2.5 percent economists polled by Thomson Reuters had forecast.

The Dow Jones industrial average tumbled 106 points in early morning trading.

The report confirmed investors’ belief that the recovery is weakening as unemployment remains high and government stimulus programs end. Consumers cut back on their spending because of job worries and companies spent less to rebuild inventories.

The figure was especially discouraging after the government revised first-quarter growth to a pace of 3.7 percent from 2.7 percent.

The Dow Jones industrial average entered the last day of July up 7.1 percent for the month. The market‘s big gains have come on strong corporate earnings and profit forecasts that conflict with economic reports that point to a slowdown.

In the past few days, however, investors have been more focused on economic reports. Disappointing numbers on housing and unemployment and cautious words from the Federal Reserve have sent stocks lower.

In early morning trading, the Dow Jones industrial average fell 105.96, or 1 percent, to 10,361.20. The Standard & Poor’s 500 index dropped 11.88, or 1.1 percent, to 1,089.65, while the Nasdaq composite index fell 28.50, or 1.3 percent, to 2,223.19.

The disappointing GDP report sent investors into the safety of the Treasury market, which drove interest rates lower. The yield on the 10-year Treasury note, which moves opposite its price, fell to 2.93 percent from 2.99 percent late Thursday. Its yield is used to set rates on mortgages and other consumer loans.

European markets fell after reports that Spain’s credit rating is likely to be cut by Moody’s Investors Service. The potential downgrade comes as the country’s unemployment rate jumped to a 13-year high of 20.09 percent and the government continues to grapple with rising debt problems.

Losses also accelerated in Europe after the weak GDP report.

Spain’s IBEX 35 fell 2 percent. Britain’s FTSE 100 fell 0.8 percent, Germany’s DAX index dropped 0.8 percent, and France’s CAC-40 fell 0.8 percent. Japan’s Nikkei stock average fell 1.6 percent.

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- About the Author: WorldMarketMedia.com (The Global Online Investment Community) is a high traffic stock market, news data website providing cutting edge new media products and services to publicly traded companies worldwide. Our Editor’s Desk authors insightful real-time coverage on the economy, the capital markets and their listed companies. Article Source

Shares of Industrial Services of America (Nasdaq: IDSA) hit a new 52-week high yesterday before closing up over 13% at $16.71 per share on very heavy volume. Shares took a while to respond to the company’s news last week raising guidance numbers for the upcoming release of second quarter results.

For the second quarter ending June 30, 2010, ISA expects earnings to be in the range of $0.33 to $0.38 per share on revenues in the range of $91 – $95 million. That compares with second quarter 2009 earnings of $0.17 per share on revenues of $39.1 million. Sales guidance for the quarter ending June 30, 2010 will exceed the high end of previous guidance. This was due to a stronger than expected final week of the quarter.

In a press release, Harry Kletter, CEO and founder of ISA states, “We have been very successful in our business expansion during the past two years and we will continue to look for new opportunities. While some economic indicators are suggesting a moderate slowdown in the economic recovery, we believe that the long term prognosis is still very promising.”

The recently announced specialty alloys division is now fully operational in its 150,000-square foot building which is on adjoining property to the stainless and non-ferrous operations.

ISA’s core business is buying, processing and marketing scrap metals and recyclable materials for domestic users and export markets. Additionally, ISA offers commercial, industrial and business customers a variety of programs and equipment to efficiently manage waste.

For more information on this visit http://www.worldmarketmedia.com/779/section.aspx/2096/post/industrial-services-of-american-nasdaq-idsa-hits-new-52-week-high-on-updated-guidance

- About the Author: WorldMarketMedia.com (The Global Online Investment Community) is a high traffic stock market, news data website providing cutting edge new media products and services to publicly traded companies worldwide. Our Editor’s Desk authors insightful real-time coverage on the economy, the capital markets and their listed companies. Article Source