Weekly Market Report for March 14 – March 20, 2010
Courtesy of InTheMoneyStocks.com
The S&P 500 traded higher again this week. The index traded higher by 11 points from last weeks close. So far the January high of 1150 has held as resistance. Should the market break out and confirm above this 1150 level the next major weekly resistance area will be around 1200.00. Options expiration is on Friday March 19th, 2010. This usually makes for a volatile, and choppy week of trading as a lot of institutional games will be played into expiration.
The SPDR Gold Shares ETF (NYSE:GLD) sold off sharply losing nearly 3.00 points on the week. Last week we mentioned the possibility of a lower high pivot being formed and this is exactly what took place. The 104.50 – 105.00 area is still going to be some support on the weekly chart followed by the 100.00 area. This week the GLD declined even as the U.S. Dollar sold off. This is a rare event and could be signaling further weakness for gold in the near term. While gold continues to look like a great long term hold 2010 should be a volatile and choppy year for the precious metal.
The U.S. Oil Fund ETF (NYSE:USO) finished last week basically flat. Oil is trading at its high range for the year as it continues in a long sideways base since June 2009. Every time oil has reached these levels it has pulled back. Until it can break out and confirm a close above the 42.00 level we are likley to see more range bound trading in the USO. Currently the weekly resistance level for the USO is 42.00 and the weekly support is 34.00.
The U.S. Dollar Index sold off this past week losing 0.66 cents for the week closing down at 79.77. This may not sound like much, however, this is a lot of meat and potatoes when it comes to the dollar index. Generally, a strong dollar will have a negative effect on the major indexes. Currently the dollar still looks to be consolidating just under the weekly 200 moving average. Therefore, this could ultimately be a bullish pattern for the U.S. Dollar index. It is important to remember that a stronger dollar usually adversely effects commodities and inflationary stocks. The opposite effect is true when the dollar declines.
