Focus Letter

Market Slows Into Upcoming Holiday Weekend

Good morning! The corrective action we saw coming off Tuesday's lows into the close continued as anticipated into the next morning. As a whole, however, Wednesday was a very choppy narrow range day. Highs were made on the day by the time the 10:15 ET reversal period hit.

The Dow Jones saw the most strength due to assistance from Boeing Co. (BA) and General Motors Corp. (GM). BA received an upgrade following the signing of a general purchase agreement with China Aviation Supplies Import & Export Group, while GM responded favorably to news that workers at its main auto parts supplier will not be going on strike as previously feared.

As a result of these events, the Dow managed to end the day with the strongest gain out of the three major indices of 0.4%, up 40.34 points to 11,129.97 in the $INDU. The Nasdaq Composite ($COMPQ) and S&P 500 ($SPX) remained relatively unchanged at the close as compared to opening levels, which were slightly above Tuesday's close. The Nasdaq gained 4.33 points to end at 2,314.68, while the S&P 500 rose 1.55 points to 1,288.12.

http://tradingfrommainstreet.com/images/FocusLetter/20060413nas.gif

Simply looking at the intraday charts of the indices does not give one a very good picture of Wednesday's action. On the surface it appeared as if the market was rather stagnant, when in reality there were a great many intraday setups (although I wish I caught more of them than I did!) Some of the best gainers with strong intraday patterns were CTSH, ROLL, CC, GM, BA, BTUI, UNH and DE. Biotechs and gold stocks performed the best as sectors, along with semiconductors and networkers. On the other hand, AAPL and OSIP were two of the best decliners on the day, but many of the oil services and homebuilders stocks also felt a great deal of pressure.

http://tradingfrommainstreet.com/images/FocusLetter/20060413sp.gif

The market did attempt to resume its selling into the afternoon coming out of the 14:00 ET reversal period, but after a low move from the mid-day highs, it was unable to pick up steam. Once the support levels from the morning were reached, the 15:00 ET reversal period had approached and the market pulled back up into the middle of the range, falling flat once more into the close.

http://tradingfrommainstreet.com/images/FocusLetter/20060413dow.gif

Initial jobless claims and retail sales will be the big numbers for the week and both are due out ahead of the open on Thursday. Jobless claims are estimated to come in around 302,000 compared to the previous number of 299,000. Retail sales are forecast at 0.4% for March after falling -1.3% in February. With the holidays now under way and the market closed on Friday, I am expecting a slow session. Typically you can still find a few decent intraday setups in the morning, but risk increases dramatically into the afternoon.

UPCOMING MENTORING OPPORTUNITIES:

To further you own knowledge of market activity and technical analysis, you may be interested in participating in one of my upcoming online seminars. Held April 24th-28th, I will be utilizing the Hotcomm platform which will allow participants the same opportunities as they would attending a class on-site. For more information, click on the journal image at the right hand side of my site at http://www.tonihansen.com or email me directly at toni@tradingfrommainstreet.com. To register CLICK HERE.

When asking those who attended my last class which aspects of my course were most beneficial, their responses were very similar:

"The concepts introduced such as pace and pace within patterns which were new to me and which I HAVEN'T SEEN ANYWHERE ELSE." - Larry
"I found everything in the course to be beneficial... It ranked as the best I have seen. Seriously, cant imagine any course being better. Hotcomm is a virtual chatroom where one can see charts and listen to commentary live!" - Karl
"The whole course covers everything you need to know about being a successful trader.... I have gone from an "unprofitable trader" to being a "PROFITABLE TRADER." Your course made the difference...." - Jeff