Spent Fireworks  In the days leading up to the Independence Day fireworks there were some in the market as we had a nice rally from the June lows. Once the picnics were finished the markets dropped taking the Dow futures to the 38% retrace from that rally off the June lows. There was a decent bounce at the end of the session on Friday - we will see if it can can continue this week, or will it have to pullback further. Last week was a short trading week and they are prone to volatility and quick reversals and expect to see more of the same during the summer months. The small caps continued to lead the rally in the first part of the week, and that is a bullish sign for the future, but they are still rather overbought and this week may see further pullbacks and consolidation as the middle two weeks in July have a history of being more negative than positive. There continued to be some job growth in the numbers this week, and the ones for May were upwardly revised. The ADP report which may be a better judge of real job growth increased by much more than expected as they reported private sector job additions of 176,004 in June.

Before we get to today's charts some  entertainment. 

Adam Ben Ezra   Bass Artist // Composer // YouTuber from Tel Aviv, Israel. From his Facebook page: Adam Ben Ezra delivers a one man show like you've never seen before. He gracefully combines virtuous playing into pop songs, morphing his double bass into a multi useful instrument. With his hands he'll tap percussion bits on the double bass's wood or strings, then straight after, will move into recording a new layer with the double bass's bow, then might go into a solo on the Clarinet, Guitar, Melodica, Piano or Oud. Keeping busy with all that, he'll approach the microphone to add his voice. All is maintained into a flowing pop song structure. You just have to see it to believe it.  See his website http://adambenezra.com/ Send him a tweet @AdamBenEzra For Dexter TV show followers he does a great theme version Dexter - Killer Music Video  Today's video is an original by him titled "Can't Stop Running."

The U.S. economy saw continued job growth in the month of June, as a report released by the Labor Department showed that non-farm payroll employment rose by 80,000 jobs in June following an upwardly revised increase of 77,000 jobs in May. Economists had expected employment to increase by about 100,000 jobs compared to the addition of 69,000 jobs originally reported for the previous month.

This report may be more accurate as they actually write payroll checks. Private sector employment in the U.S. increased by much more than expected in the month of June, according to a report released by payroll processor ADP, with the data offsetting recent concerns about the strength of the labor market. ADP said the private sector added 176,000 jobs in June following an upwardly revised increase of 136,000 jobs in May. Economists had expected private sector employment to increase by about 95,000 jobs compared to the increase of 133,000 jobs originally reported for the previous month.

New unemployment claims fell more than expected for the final week of June, according to figures released by the Labor Department. The DOL calculated that there were a seasonally adjusted 374,000 new claims for unemployment for the week ending June 30. That marks a notable drop of 14,000 from the previous week's revised figure of 388,000 and comes in well below the 386,000 level predicted by most economists. The previous week's figure was revised up slightly from the 386,000 initially reported.

Despite the continued job growth during the month, the unemployment rate remained unchanged at 8.2 percent, in line with economist estimates

The Labor Department reported that nonfarm payrolls (jobs) increased by 80,000 in June. Today's chart provides some perspective in regards to the US job market. Note how the number of jobs steadily increased from 1961 to 2001 (top chart). During the last economic recovery (i.e. the end of 2001 to the end of 2007), job growth was unable to get back up to its long-term trend (first time since 1961). More recently, the number of nonfarm payrolls has been working its way higher but at a pace that is not fast enough to close the gap on its 1961 to 2001 trend. It is interesting to note that the current number of US jobs recently surpassed its 2001 peak. If this month's pace of 80,000 new jobs were to continue for each and every month going forward, the 2008 peak be reached in the third quarter of 2017.

This past week's  sectors.

This past week's indices  -  mid and small caps leading the way

With the first week of the month concluded the Dow, NASDAQ, and S&P 500 show minor consolidation, while the Russell 2000 has gains for the month. Oil and gold  a bit more bearish at the moment.  

The 60 min. chart shows the drop this week started in the afternoon of Thursday though most of it came in the morning on Friday and after dropping under the lower Bollinger band we saw a last hour rally to end the week. 

The previous week closed with the Dow just slightly over the 20 week moving average, though it was still really at resistance. So this week it dropped back under though it was on lower volume due to the short week. 

This longer-term daily chart shows the 50 day EMA is bearishly  15 points above the 20 day moving average. Crossing back over will be bullish and may also spark a larger advance.  

The Dow futures having rallied from the June low at the 38.2% retrace may still challenge this year's high once breaking over this top trendline. 

On this 60 min. Dow futures chart from the rally that started at the end of June, Friday saw the retrace to former support and the 38.2% retrace level and the rally began and RSI went over 30. 

The transportation average was virtually unchanged for the week, which is positive to hold the gains from the previous weeks rally. 

The utility average and failed to break out to new highs so has pulled back instead though it did manage to close barely over the 20 day moving average. 

The NASDAQ itself did not advance much -  the summation index continues to show its long positions. 

The moving average of number of new highs on the NASDAQ had moved up sharply and much more quickly than the NASDAQ 100 in red. This is a positive sign, but it may need to consolidate which would mean some pullback in the market short term. 

The NASDAQ is still 50 points above the 2011 high so you can see the resistance at this level. 

The 60 min. NASDAQ with its Williams indicator that can be helpful as a minor trading guide. 

The NASDAQ 100 futures broke above this bull flag and then on Friday pulled back to it , so far, successfully tested it and bounced. 

From the live stockcharts public page. The 15 min. NASDAQ 100 ETF with its short term trading signals. 

Apple had a good week breaking above this minor trendline and putting in a strong rally, closing back over this 78.6% Fibonacci level making the odds better than 50% that it will test the 619 resistance level. 

The 60 min. chart from our stock charts public page showed the break from the descending bullish channel at about $575 and the rally from there. 

The volatility index remains under 20, closing at 17 this week. 

Semiconductors still feeling no love and remaining below its major moving averages. 

Often when the McClellan oscillator runs to its top Bollinger band see a market pullback and this is what happened on Friday. 

The upper half of the chart is the NYSE and the lower half the moving averages of new highs minus new lows, as it had run sharply higher. 

The percentage of stocks on the NYSE trading over there 50 day moving average jumped almost back to the top red line and now 65% are trading over their moving average. 

The S&P 500 though it went slightly above the 20 week moving average this resistance proved a bit much, at least for now. 

The little pullback this week was not enough to affect our bullish percent indicator for the S&P 500. 

This daily chart shows the triangle moving closer together so we would expect to see a breakout or down quite soon and at the moment the odds are to the upside. 

Here is a closer view with the Friday pullback almost touching the 13 day EMA before the afternoon bounce. 

 The 60 min. chart without much resistance for the first 10 points it least over the 1375 price. 

The 15 min. S&P 500 from our public page, which caught most of the gains from the late June rally and exited on the Friday dip. 

The S&P 500 futures with additional overhead resistance at the top trendline. 

This 90 min. S&P 500 futures showing the rapid decline on the drop below Friday's S1 pivot and top trendline and its eventual recovery back just under that line. 

From our public page the moving average crossovers on this ultra long S&P 500 ETF. 

The Russell 2000 small caps were leading the charge in the recent rally, which is quite bullish to have them over perform the large, but it ran into this resistance on Tuesday and it was to extended to move further. 

On a further pullback look to the top trendline for possible test near the 790 level 

The 3-X ETF for the Russell 2000 ran from $47.50 up 11 points before it pulled back to test this top parallel channel line on Friday 

The banking index dropped back to the 50 day EMA where it had a small gap. 

The retail sector briefly made new highs for the year and ended the week up 0.50% 

The Dow Jones world market also ran into resistance this week, but ended basically unchanged and midway inside of its triangle. 

The Shanghai composite index did not really attempt a rally this week, and remains under this resistance. Hard to imagine the US markets continuing to rally if the  Chinese market does not start some recovery. 

This commodity tracking ETF had a two week rally, though the volume was not strong enough to sustain it. It did come off a test of the 2011 lows and often those type of bounces can be quite strong. 

For the week crude oil was down slightly, though it is still holding over its 2011 lows. 

Although oil has been bouncing from the test of the 2011 lows it has yet to be able to close back over the 200 week EMA.  

Natural gas remains bullish though it ran into its 50 week EMA  so is retracing a little bit. 

The short term natural gas futures exit we posted just prior to it taking place and that was it's break below this parallel channel trendline. 

The Nat gas ETF had also run into this horizontal resistance and so pretty naturally pulled back perhaps to just gather strength. 

The ultra long for natural gas from our live streaming charts page open during regular market hours. 

This 30 min. chart shows some possible support, which is also in line with the 200 period EMA. 

Gold had gone over the 50 day EMA but not the 200 day and pulled back with the rest of the market late in the week. 

This chart was posted well in advance showing the down trend line just over the 78.6% Fibonacci retracement resistance and the drop actually started when RSI moved back under 70. 

With the drop in gold the gold miners ETF mechanical chart also shifted back to sell. 

I still think it would be more beneficial long-term for silver, shown here with the ETF, for a  drop a bit under the trendline and  the horizontal line and then a more significant rally 

The mechanical chart has one green bar not enough to bring it back to a buy.

Copper had moved back over the 200 week EMA last week, though this week closed slightly back under it. 

Palladium continued weak with no real hints of a trend reversal. 

Last week the euro index tried to rally but ran into the resistance horizontal line. So this week continued its drop making new lows not seen since 2010.  

The euro futures drop under our 127.2% projection and may rally as RSI is oversold, but there is the chance now as well that it will continue to the 161.8% projection shown. 

The US dollar already up 2% for the month getting closer to the top trendline.  

The dollar is still above this monthly trend line and its major resistance is at its 200 month EMA near 89. 

The daily chart shows it held support at its 50 day moving average on the pullback and it looks quite bullish for the dollar.  

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