Stocks Sideways…Worried About Commodities

WEEKLY MARKET ANALYSIS

Stocks opened modestly higher but the advance reversed but more modestly intra-day into the close. The Dow Jones Industrial Average ETF DIA was down 0.09 points on the day and closed at 258.19 For the S&P 500, there is support near 2778 and 2764. Resistance levels are currently at 2804 and 2818. The key was oil’s weakness and golds strength. This could be a canary to watch out for.

GLOBAL ASSETS UPDATE

TWELVE SECTOR ANALYSIS

VOLATILITY UPDATE

On Wall Street, 10 of the 12 major market sectors are seeing red today. The biggest losers are Energy (XLE), Pharmaceuticals (XPH), and Transportation (XTN). The strongest sector today has been Retail (XRT) which has gone up 0.2%.

The CBOE Volatility Index (VIX) is up $0.22 going from $14.52 to $14.74 today. The ratio of puts to calls for the current at-the-money strike of $15 is below average which means that traders are favoring Calls over Puts currently.

MARKET HEAT

A NASDAQ stock with unusually high volume today is Ctrip.Com International Ltd (A (CTRP). On the AMEX Goodrich Petroleum Corp (GDP) has had significant interest, and on the NYSE GNC Holdings Inc (GNC) has had unusual volume.

The biggest mover out of other high-volume stocks is Ctrip.Com International Ltd (A (CTRP) which has moved up over 20% recently on volume of over 38 million shares. The chart below shows the performance of CTRP over the last year. Ctrip.com International, Ltd. (Ctrip) is a travel service provider for accommodation reservation, transportation ticketing, packaged tours and corporate travel management in China.

DARWIN CTRIP.COM INTERNATIONAL LTD (A FORECAST

The performance of Ctrip.Com International Ltd (A (CTRP) will be worth watching in the near term for a number of reasons. The forecast for the coming week on CTRP is for the price to go down. The correlation of CTRP to the S&P 500 recently has been 0.4 which is a weak positive correlation. Key levels to watch for CTRP are downside support at both the $31 and $36 price points.

Trade smart,

Paul "Bulldog" Hudson, Chief Investment Officer
Darwin Investing Network