Last weekend, in my Market Forecast, I wrote:
"For the new week, a whole lot more earnings reports are coming in... The market is barely being supported by its daily MAs. A quick dip could send it to test SPX 1040 again. It'll be up to the earnings again. Monday and Tuesday could induce big market moves with IBM, TXN, GS, YHOO, and AAPL in the spotlight. This market is still very much range-bound. On the upside, SPX will have to break above that 1100 level."
Indeed, the market traded in reaction to the earnings reports. Most earnings turned out to be positive and the market closed just above that SPX 1100 level. On Monday, in anticipation of good earnings from IBM and TXN, the market ended slightly higher. However, after the market, although IBM and TXN delivered solid reports, the expectation was perhaps too high. On Tuesday, both STLD and BTU reported great earnings and the commodity sectors rallied. The market pushed higher and looked past IBM and TXN's earnings. After the market, AAPL blew away the estimates with its quarterly results. On Wednesday, things started out strongly as MS, FCX, and WFC all gave outstanding earnings. But, the market experienced a quick selloff as Bernanke gave his testimony on the economy to Congress. On Thursday, the market whipped around like a whirlwind and recovered Wednesday's quick loss in the first 30 minutes of trading! CAT and UPS gave investors hope that the economy is recovering. On Friday, the market appeared weak in the morning as some profit-taking took place. However, it ended on a strong note and continued higher.
We only closed a few trades this week as the market swung wildly, up-and-down. We got shaken out of a trade on VMW, which would have been a very nice winner. The other closed trades were all on the green side:
July 21, 2010
08:27 | HappyTrading GOOG ($478.00) Sold to Close 08C500 Aug 500 calls, at $5.30 +4%
July 20, 2010
12:33 | HappyTrading GOOG ($482.20) Sold to Close 08C500 Aug 500 calls, at $6.80 +33%
08:36 | HappyTrading VECO ($38.80) Sold to Close 08C40 Aug 40 calls, at $2.90 +4%
08:25 | HappyTrading VMW ($70.90) Sold to Close 08C75 Aug 75 calls, at $2.55 -29%
July 19, 2010
12:17 | HappyTrading GOLD ($89.78) Sold to Close 08P90 Aug 90 calls, at $3.90 +8%
11:56 | HappyTrading GOLD ($89.60) Sold to Close 08P90 Aug 90 put, at $4.00 +11%
08:00 | HappyTrading AAPL ($240.30) Sold to Close 08P230 Aug 230 calls, at $9.30 +7%
For the week, the Dow was up +326.72 points; SPX added +37.78 points; Nasdaq gained +90.42 points. Oil went up while gold was pretty much flat. This evening, at the time of this writing, the Asian markets were mostly higher. Here's how the US market looks after Friday's close:
SPX
On Friday, SPX added +8.99 points to close at 1102.66, just above the 1100 level. The daily MAs turned up and the MACD went higher.
Nasdaq
Nasdaq gained +23.58 points to close at 2269.57. It closed above the 2250 level. Its daily MAs and MACd curved up.
Both SPX and Nasdaq closed above their respective daily MAs, and above their key resistance levels (SPX 1100 and Nasdaq 2250). But, we were here just last month when the market took a quick 2-week dive! For the new week, more earnings reports will gush in. Some notable ones are:
Monday: BWLD, GNK, SOHU
Tuesday: BP, BRCM, DWA, NBR, PNRA, X
Wednesday: AKAM, AEM, BMC, CLF, GLW, DRYS, NEM, OII, BA, V, WLP
Thursday: AMGN, AMSC, CNX, CME, FSLR, MOT, NOV, POT, SI
VIX has sank back below 24, which could signal the intention to rally. We'll have to see if the market can continue to push higher and stay above SPX 1100. If SPX 1100 is cleared, SPX should retest the 1120 level. Miners went up quite a bit last week and may need to take a quick breather. We'll need to see if other sectors can take the leadership while the miners rest. Preferably the leadership would come from technologies and financials. Let's take a look at some of these sectors.
Sector Watch
XME (metals and mining)
Miners were very strong last week. XME already jumped above the $50 level and has caught up with its daily upper BB. X, CNX, and CLF are all reporting next week. If the earnings are strong, with a quick rest, the miners can push up more.
XLF (financials)
XLF tested the support at $14 and bounced back up. BAC has been very week while MS has broken out. GS, WFC, and JPM has been trading flat. XLF will still need to take out that $15 level in order to go higher. Lots of regional banks are reporting in the new week.
PBW (clean energy)
PBW has caught up with its daily upper BB and is looking good. Solar stocks have been strong. SOLR got a big jump on Friday. TSL has already been on a 4-week run. FSLR will report on Thursday. STP and YGE are among the other favorites in this group.
SOXX (semiconductors)
SOXX also closed above its daily MAs. A push to catch the daily upper BB could send SOXX on a new bullish trend. Semiconductors will be very important, as a group, if the market were to push higher. INTC and QCOM both reported very well and received positive reactions. BRCM will report on Tuesday and should be a mover for the sector.
Good night and HappyTrading! ™ 
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