Last weekend, in my Market Forecast, I forecasted,
"For the new week, the latest development in the charts are certainly not bullish. However, it may not necessarily dictate a breakdown. If SPX 1080 does not hold, the next support is 1060, set back in mid-July. The market could still be range-bound, and, is very mixed."
As it turned out, the market was indeed still range-bound. The market was flat on Monday. On Tuesday, the market bounced, cheering better-than-expected industrial production report. On Wednesday, stocks traded sideways again. On Thursday, the market gave back all of the week's gain, spooked by the rise in the jobless claims. Friday was a mixed day as industrial and commodity sectors were weak, but, techs were strong, helped by some strong earnings reports.
We finished a nice week with trades mostly in the green and a very nice day on Tuesday. Our play in gold, GLD, also helped, as the market was weak, but, still range-bound.
For the week, the Dow was down 89.53 points; SPX slid 3.94 points; Nasdaq gained +6.28 points. It is very interesting to note that the techs actually finished higher! Last weekend, in the Sector Watch, I said that "Semiconductors can decide where the Nasdaq goes, and they usually do. If this market were to hold, we'll need to see buyers in the semiconductors." The semiconductor index (SOXX) ended higher. Gold went up above $1220/ounce and oil continued to sink. At the time of this writing, Asian market were mixed. Japan was still very weak, but Taiwan saw some strength. Here's how the US market looks after Friday's close:
SPX
SPX slid 3.94 points to close at 1071.69. The daily MAs and MACD turned lower.
Nasdaq
Nasdaq added +0.81 points to close at 2179.76. Its chart shows similar developments as in that of the SPX.
Both SPX and Nasdaq closed the week below their respective support levels (SPX 1080; Nasdaq 2200). However, VIX finished down for the week, below 26. For the new week, the technicals are still carrying a bias to the downside. The M&A activities and the speculations for them are offsetting the inconsistency in the latest economic reports. The M&A activities are bringing buyers into some sectors. However, the industrials have been weak on further economic worries; and thus, this market is still very mixed. We'll have to see if we can get some favorable economic data to get the market back in rallying mode. We have GDP report and consumer sentiment on Friday; and, of course, the unnecessary "weekly" jobless claims on Thursday (once every 2 to 4 weeks would probably be a lot more accurate and won't make people so jittery). The market will have to at least get above the daily MAs to get some breathing room (SPX 1110; Nasdaq 2250). The downside potential is still there and the market will need to see strength early in the week to prevent the downside momentum from building up.
Sector Watch
GLD (gold)
GLD tested $120 last week and closed just under. If $119 holds, GLD should rally higher. If the broader market is strong, gold miners will be playable. NEM, ABX, and GOLD have very good potential to break out.
MOO (agriculture)
MOO closed above $44, but, may need a couple of more days to consolidate. Unless, of course, more M&A activities or news come out of this sector. POT is getting toppy in the daily charts. MOS, AGU, and CF all still have much room to rise.
INX2 (internet)
INX2 closed below 250 and will need to see some strength to prevent going into a bearish formation. PCLN has been really strong. MFE just got bought out. AMZN still looks healthy. But, GOOG has been sliding.
XME (metals and mining)
XME closed right at the 30-day MA. The miners have been the biggest movers for the SPX. Coal stocks have pretty much been trading in a tight range, just as the market indices. We'll probably need to see the coals stocks move higher for the market to gain strength.
Good night and HappyTrading! ™ 
(click to see our Facebook Page)
