Market News for the Prepared Mind 05.02.2011

 It was quite a week and it closed quite a month.  The equity markets were up for the fifth straight month.  The U.S. dollar hit a three year low.  Gold reached new highs.  The Russell 2000 hit an all-time high.  Crude oil went up for the eighth straight month, while coffee reached a 34 year high.  The Dow Jones Transportation Average set a new high closing price.  Silver approached new highs, while the COMEX raised silver margin requirements twice during the week.  The NDX has reached its highest levels since December 2000.  

It was a week of superlatives. The S&P 500 (SPX) closed at 1,363.61 or up 1..96%,   the NASDAQ 100 (NDX) closed at 2,404.08 or up 1.13%, the Russell 2000 closed at 865.29 or up 2.32%, and the Dow Jones 30 Industrials closed at 12,810.4 or up 2.32%%.  Implied volatility for the indexes - SPX (VIX). RUT (RVX) and NDX (VXN) - held steady for the week and were up a normal amount.  It appears many traders are using the VIX as a hedge against a downward move in the market.

The earnings season continues in full force this coming week,  Economic reports, combined with earnings. should be a starting point in giving us direction for the market.  Silver volume - the futures, ETF's, and options -should provide entertainment throughout the week.  Options volume in SLV last week exceeded the options volume for every other listed product.  The precious metal markets have the potential to set the tenor for the trading week.

I can't count on the Lone Ranger and Tonto to save me from this market.  Only my trading discipline can save me.  The SPX is up nearly 6% in the last 9 trading days.  I have resisted the urge to step in front of this trend.  I do best when I don't try to buy a bottom or sell a top.  I wait for trades to come me.  

  Remember:

  "Chance favors the Prepared Mind." - Louis Pasteur

This week's economic news:

Monday May 2:

Economic: ISM Manufacturing Index - 10:00, March Construction Spending - 10:00

Earnings: BMO - Before Market Open: Loew's (L);  AMC - After Market Close: Chesapeake Energy 
(CHK), Automatic Data Processing (ADP), Andarko (APC).

Other:  NASDAQ-100 (NDX) rebalancing takes place before the opening.

 Tuesday May 3:


Economic:  Motor Vehicle Sales ,  ICSC Goldman Stores Sales - 7:45, Redbook - 8:55, March Factory Orders - 10:00

Earnings:  BMO:  Mastercard (MA), Marathon Oil (MRO), Archer-Daniels-Midland (ADM);   AMC: Fisrst Solar (FSLR), Green Mountain Coffee Roasters (GMCR), Comcast (CMCSA), Vertex Pharmaceuticals (VRTX).

Other:  Japanese markets closed.

Wednesday May 4:

Economic:  MBA Purchase Applications - 7:00, Challenger Job-cut report - 7:30, ISM - Non-manufacturing Index - 10:00..

Earnings: BMO:  Kellogs (K), Time-Warner (TMX);   AMC: Microsoft Met-Life (MET)..

Other:  Japanese markets closed.

Thursday May 5:

Economic:  Chain Store Sales, Initial Jobless Claims - 8:30,  Q1 Productivity and Costs - 8:30.

Earnings: BMO: CVS-Caremark (CVS);  AMC: Priceline (PCLN), Kraft (KFT)

Other:  Japanese markets closed.

Friday  May 6:

Economic:  April Non-farm Payroll - 8:30, April Unemployment - 8:30, March Consumer Credit - 8:30.

Earnings: BMO:  Madison Square Garden (MSG), Constellation Energy Group (CEG)