Swing Trading Strategies & Stock Picks Since 2003

Dow Jones Industrial Average

19^th June 09

Key Statistics

Open: 8556.96

High: 8616.59

Low: 8496.73

Close: 8539.73

Change: -15.87 (-0.19%)

RSI: 36.30

MACD: 64.21

Snapshot

• Dow ended -15.87 (-0.19%) points lower, S&P 500 up 0.3 pct and Nasdaq up 1.1 pct.
• Falling commodity prices dragged on the underlying stocks.
• Goldman Sachs adds Microsoft to "conviction buy" list.

Current Market view– Cautious

Market Strategy

The market is showing extreme volatility at current levels. At present the market is range bound with 8300 being the support and 8800 levels the resistance on the upside. Currently the market is at the top end of the range. As expected, the market is facing stiff resistance on the up move. Prefer booking profit on higher levels. We expect the market to go into an intermediary corrective phase. In the current down move, 8230 level will act as an intermediary support. In the Friday’s session we expect market to exhibit volatility.

Market Commentary

The S&P 500 and Nasdaq rose on Friday as positive broker comments on Microsoft boosted technology shares, but the major averages lost ground for the week for the first time in five weeks.

Microsoft Corp (MSFT) jumped 2.4 percent to $24.07 after Goldman Sachs added shares of the world's largest software company to its Americas "conviction buy" list and said new products and an increase in information technology spending should underpin growth.

Apple Inc (AAPL) rose 2.7 percent to $139.48 as its latest iPhone hit stores.

Energy shares pulled the Dow lower and dragged on the S&P 500 as oil prices CLc1 fell below $70 a barrel on bets there would be ample fuel supply for the summer vacation season. Dow oil components Chevron (CVX) and Exxon Mobil (XOM) slipped.

Stocks also were buffeted by the end of the two-day quadruple witching period, the expiration and settlement of June stock and index futures and options. Volume was higher due to the expiration. Four types of June futures and options contracts expired or settled on Friday, a quarterly event that tends to generate high volume as investors adjust or exercise their derivative positions.

Financial shares helped support the S&P 500 after the sector retreated earlier in the week. JPMorgan Chase & Co (JPM) gained 2.4 percent to $35 and ranked among the Dow's biggest advancers. Bank of America (BAC) was up 2.5 percent at $13.22.

Trading volume was heavy on the New York Stock Exchange, with about 2.13 billion shares changing hands, well above last year's estimated daily average of 1.49 billion, while on the Nasdaq, about 3 billion shares traded, above last year's daily average of 2.28 billion.

Advancing stocks outnumbered declining ones on the NYSE by 1,868 to 1,117 while on the Nasdaq, there were 1,565 advancers and 1,084 decliners.

Economic Data

The jobless rate rose in nearly every state in the nation in May, the government reported. One state -- Nebraska -- registered a decline and Vermont saw no change.

Michigan led the nation with a 14.1% jobless rate, followed by Oregon with a 12.4% rate. For the full year, jobless rates were higher in all 50 states and the District of Columbia.

However, the labor market typically lags any other broader recovery in the latter stages of a recession, so the day's jobless numbers didn't seem to impact investors looking for signs of a broader stabilization.

A number of recent indicators have suggested the job market is starting to stabilize, but that hasn't helped the millions of unemployed Americans looking for work.