Bailing   The economic and social problems in Greece are  not at all going to be resolved in the short term, but the markets to some degree are handling that as it is a small country. The bigger uncertainty however, is how many other countries will need bailouts, where will the money come from and how long will this keep the euro system afloat. As one newspaper put it, "Spain is going to need not just a bailout for its banks but also to restructure its debt or default on some of it. That is just the math. And when Spain needs that money, the market will get very nervous about Italy. And we mustn't forget Portugal; it will need debt forgiveness as well. Oh, and Ireland. German Chancellor Merkel this week warned that the policies of the new Socialist French president, Francois Hollande, could destroy the eurozone by bringing the sovereign debt crisis to France itself. The rest of Europe is watching Greece implode. Spain has almost 25% unemployment. Italy has rejected basic labor reforms. The entire continent seems to be in denial."

On the home front the Fed will announce a rate decision on Wednesday and all will be looking for any hints of possible future easing via a type of QE3 or other. The recent weakness in economic data increase the chances of additional Fed action. After the Monday's dip the market had a pretty good week with a rally on Friday. The large caps Dow had the best gains with oil having a slight move up. The small caps underperformed and this is not bullish but still, the short term lows may be in place for further gains.

Our stockcharts public page have been extremely useful in pointing out the market directional changes and even just using the market ETF's and Mechanical charts shown there. They caught the 27% move on BOIL this week as it broke over the downtrend line.

I just learned of this site stereomood.com and thought it worth sharing.   Hopefully you have an Internet ready music system or good quality amp and speakers for your computer. This is one of many streaming music sites but has an interesting approach. They have a long list of moods - such as calm - beach party - in love - funky - etc and you select the mood you want and they send the music. It is really a great way to find new artists and songs you have never heard. You can create your own play list when you hear songs you especially wish to hear again. While annotating charts I was listening to the mood "asleep on my feet" some great selections - hope it did not mess up the charts. 

On Sunday I was listening to the mood - stargazing - and discovered Megan Podwin from Vancouver, Canada. She has a YouTube cannel PigNowNamed and her soundcloud - http://soundcloud.com/meganpodwin where she has originals and covers. I really like her cover of Grey by AniDfranco.

Before we get to today's charts some  entertainment.

Misheard lyrics   Have you ever thought you knew the lyrics to a song then later found out that you had them very wrong? The Hollies made a song - Bus Stop - I have forgotten what I thought the lyrics were but one day years later in a car the song was on and the passenger was singing along.   I heard, "Bus stop, wet day, she's there, I say, "Please share my umbrella." My mouth fell open in amazement as these lyrics were totally different than the ones I had thought they were. Well today's video shows a version of possible lyrics to a song you have for sure heard in the past. The video was made by FamishedMammal on YouTube. O Fortuna is  a poem written in the early thirteenth century that in 1935 it was set to music by German composer Carl Orff as part of cantanta Carmina Burana. I think this version is performed by the Boston Symphony Orchestra, New England Conservatory Chorus and the Children's Chorus of the New England Conservatory. Careful with the windmill cookies.

New claims for unemployment insurance in the U.S. came in higher than expected for the week ending June 9, according to figures released by the Labor Department. The Department estimated new claims at a seasonally adjusted level of 386,000, an increase of 6,000 from the previous week's revised level of 380,000. Additionally the larger than expected increase comes atop revised figures that put the level of initial claims for the week ending June 2 at 377,000. Most economists had predicted a continuing drop in new claims for the week to 375,000.   graphs - RTTNews

U.S. business inventories rose in April, as companies were left holding more goods in warehouses and stockrooms amid sluggish sales. Inventories increased by 0.4% to a seasonally adjusted $1.575 trillion, the Commerce Department said Wednesday. The gain was slightly above expectations for a 0.3% rise.

U.S. industrial output rose a better than expected 1.1 percent month-over-month in April, thanks to a 4.6 percent jump in utility output. Manufacturing output also rebounded, rising 0.6 percent on solid support lent by motor vehicle and parts and business equipment. Capacity utilization rose by a better than expected 0.8 points to 79.2 percent.

New York manufacturing activity has seen only a slight expansion in the month of June, according to a report released by the Federal Reserve Bank of New York on Friday, with the index of activity in the sector falling by much more than economists had anticipated. The New York Fed said its general business conditions index fell to 2.3 in June from 17.1 in May, although a positive reading still indicates growth in regional manufacturing activity. Economists had expected the index to show a much more modest decrease to a reading of 13.8.

Falling energy prices drove a larger than expected drop in consumer prices in May, according to figures released by the Labor Department. The consumer price index, a measure of inflationary pressure on the economy, fell by 0.3 percent in May after remaining relatively unchanged, a 0.0 percent change, in April. Most economists had expected to see consumer prices decline, but by a somewhat smaller 0.2 percent level. Compared to May 2011 levels, however, consumer prices were up 1.7 percent for the year. Excluding the volatile food and energy sectors, "core" consumer prices rose by 0.2 percent in May, matching similar increases in both April and March.

A Commerce Department report showed that retail sales fell 0.2 percent month-over-month in May compared to a downwardly revised reading of a 0.2 percent drop in April. The decline was in line with expectations. Excluding autos, retail sales fell 0.4 percent, steeper than the 0.1 percent drop expected by economists. Auto sales rose 0.8 percent, stronger than the 0.1 percent in the previous month. Furniture & home appliance store sales and electronics & appliance store sales rose 0.4 percent and 0.8 percent, respectively. On the other hand, building material & garden equipment & supplies dealers store sales were lower than a month ago and food & beverage store sales also edged down. Gasoline store sales were 2.2 percent below the previous month.

A steep drop in energy prices at the producer level fueled a larger than expected drop in overall producer prices for May, according to figures released by the Labor Department. The producer price index for finished goods fell a full 1 percent in May, marking the largest drop since July 2009.
Most economists had predicted a fairly large drop in the PPI following April's 0.2 percent decline, but most had expected producer prices to fall by 0.6 percent. On an annualized basis, producer prices remain up 0.7 percent over May 2011 levels despite two consecutive monthly declines. So called, "core" producer prices, which exclude the somewhat volatile food and energy sector, rose by 0.2 percent for May, the third consecutive monthly increase in a row.

While the implications for Greece are dramatic, there is concern that a Greek exit of the Euro would threaten other euro zone members (e.g. Spain and Italy) and potentially test the ability of European institutions (e.g. the European Central Bank) to prevent contagion. Today's chart helps illustrate the risk of European debt by plotting out the 10-year government bond spread (versus the German Bund) for all the PIIGS (i.e. Portugal, Italy, Ireland, Greece, and Spain) from 2007 to the present. For example, the Greek 10-year government bond yield (light blue line) is currently 27 percentage points greater than that of the relatively stable German Bund. That is a far cry from where it was back in the summer of 2009. Currently, however, many are focused on the third and fourth largest euro zone economies (i.e. Italy and Spain). A run on the financial institutions of these more substantial economies would have global implications. It is noteworthy that the Italian and Spanish 10-year government bond spread has not declined after the ECB offered three-year loans in December and February.

This past week's  sectors.

This past week's indices  - 

With half the month completed the monthly charts appear like a short term bottom is in but the Russell 2000 is still under its Ctr., Bollinger band, which is a bit concerning.

The low this week as seen on the 60 min. charts was on Monday as the candles dipped a bit below the lower Bollinger bands making their high at the close on Friday. The RSI is again just over 70 on this time frame. 

The long term Dow shows the close back over the 50 day EMA and above the horizontal resistance line shown in green. Now on any pullback we want to see that 50 day holding support. 

On the weekly time frame we see additional resistance just overhead at  the 20 week moving average of 12,865 also shown with the horizontal resistance. 

The Dow futures chart shows the top trendline break by mid week rising up to test the previous high and here showing the next Fibonacci short term resistance level at 12,833. If it pulled back from this level on Monday, shown are retracement levels. 

The transportation average closed again above the 50 week EMA up just 0.5% this week 

The utility average had broken out last week and continued this week, especially Thursday and Friday. 

The NASDAQ summation index separated further from its EMA reinforcing the buy from the previous week. 

The moving average of the number of new highs on NASDAQ did increase some this week, but not by much. 

This view shows the NASDAQ in gray bouncing at support, while the number of new highs did also. 

This weekly NASDAQ holding above the 50 week EMA with resistance not far overhead. 

The 60 min. chart shows this possible inverse head and shoulders. 

The NASDAQ 100 ETF is now  at the previous short term high seen in May. 

The volatility index still, closing over 21. 

The semiconductor index may be forming some base here though it is still under its 200 week EMA 

Apple at an interesting point on its 60 min. chart, as a buy here would have a stop under the trendline. 

A longer-term perspective, as it is in a channel, which has the risk of being bearish 

The NYSE new highs minus new lows on the top portion of the chart with the S&P 500 on the bottom 

35% of all stocks on the NYSE are now trading over their 50-day amerage. 

The lazy S&P 500 chart with its RSI back over 50 and the 20 week moving average at 1359. 

The S&P 500 bullish percent chart and in the bottom section breakout this week from the recent range. 

This weekly chart shows that 20 week moving average overhead and beyond that the horizontal resistance

 The longer-term view of the S&P 500 with some increased volume on Friday suggesting a move at least to the horizontal resistance between 1357 and 1360. 

From our stockcharts public page The 15 min. S&P 500 short term trading switched back and forth with the last buy on Thursday near 1320 for a  22 point move into the close on Friday 

The 60 min. chart shows the move on the S&P 500 to the 38.2% Fibonacci retrace level. 

And the 15 min. renko chart broke above its parallel channel on Friday as well. 

From its high at 1342 the S&P 500 futures had dipped to support at the start of the week, and the rally finally broke above the trendline and 61.8% Fibonacci retracement on Thursday. If it continues over 1342 we show the 127.2% short term projection at 1354. 

If not trading futures one long for the S&P 500 is SSO and it went long on June 6 and has moved up several points from there. This chart also on our public page.

The Russell 2000 is lagging the other indices though it did have a 1% rally on Friday as it is moving into its 50 and 200 day EMA's and a retracement level. 

The 60 min. chart reveals some pretty strong resistance from 783 to 785. 

The 15 min. chart with a buy on June 6, but it is has not been an easy move since then. 

The 10 min. renko chart from Friday shows the nice move in a stair step fashion. 

The 3X long ETF for the Russell 2000 tested the $44.70  range a couple of times then finally broke out above a down trend line, shown better on a shorter time frame chart, and moved up 4 more points at the end of the week. 

This longer-term view of the banking index shows the close just slightly over the 38.2% retracement level but still within this horizontal resistance range. The MACD has crossed over, there is a positive histogram, while and the Williams indicator had moved from oversold conditions.

The shorter term chart showing this current resistance level with the 50 day EMA just overhead. There was a good increase in volume on Friday. 

The 30 year treasury bond price has been consolidating around its 20 day moving average. 

For day trading this 5 min. financial ETF went long the last time on Thursday with a brief whipsaw at the close, but ended up about four points during that move.  

The retail sector did not make much movement, but it did close a bit higher, and has a rather bullish candle. 

The Dow Jones world index rose 1.5% this week, and it  closed at the highest level of the past four weeks. 

The FTSE closed up less than 1% and remains below its 200 week EMA. 

A slight dip in gold was not helpful for the Canadian venture exchange and it lost 3%. 

Our commodity tracking ETF lost 1% this week consolidating under this resistance green line. It's RSI is still in oversold territory and there could be an attempt at a rally. 

Oil is not only under its 200 day EMA but under this trendline as well. The indicators are not as oversold as they were at the bounce in 2009, suggesting some longer-term downside to come 

The closer view weekly chart shows the 200 week resistance just overhead and the possible support if it eventually drops towards 76. 

After the really nice 4 week in advance this spring on natural gas, it had declined for 3 weeks, and this week found support, rallied back over the 20 week moving average, and closed up 7.8% 

The natural gas futures chart shows the breakout on Thursday. It had had positive RSI divergence since late the previous week, and the breakout seems to of brought in all those who missed the initial run this spring. 

The 1X ETF with its Thursday bounce and Friday consolidation. 

Our stockcharts public page. has this 30 min. ultra long ETF for natural gas. In the last run it moved up 70% and we said in a video this week that the next run could be dramatic at least at the start and so many had missed the first move and they would be anxious to get in. This is exactly what happened here as at the Thursday close  it had moved up 27% that day. We also generally show this ETF on our  streaming charts page open during regular market hours. Moves like these can really make your year.

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While it is true that you can  potentially make an even  larger profit with a #X ETF, as it rallied over 50% on Thursday, this ETF has very low volume, and some days trades under 100,000 shares and the volatility is not acceptable to many. It did run up over 100% during the earlier rally. This is also on our stockcharts page. 

Last week we pointed out that gold was not only bullish because of the hammer candle it's formed on Friday, but that it was also back over the descending trend line in green. This observation worked out well as gold rallied up over 2% running up to the 200 day EMA. 

At the open on Monday the gold futures charts was not so interesting, but by Tuesday it looked much more bullish and it ran almost to the down trend line by Friday 

The gold ETF still not quite back inside the ascending parallel channel or over the center Bollinger band.

The gold miners ETF still looking bullish from its test of early 2010 lows with the the 20 week EMA overhead at 48.91.

The daily chart still okay, but needs to give a move higher. This could develop into a bear flag with an additional drop. Would like it to hold the 50 day EMA but, especially the 20 day moving average at 45 

Gold metal was a bit stronger than the miners this week as the  ratio chart shows them getting closer together. 

Our mechanical chart is still on a buy with the one red bar caution at the moment. 

Silver has been very bland lately holding above horizontal and  trendline though it would be good if it could pullback to test those perhaps opening the door for a longer-term buy 

The 60 min. chart under both trendlines. 

Mechanically, it remains on a buy. 

Copper is not encouraging until it can close back over the 200 week EMA.

Palladium has been moving back up, but the low volume warns that this could be a bear flag. 

The euro as it bounced a bit while RSI moved back over 30. 

The ultra short for the euro has dropped back from the breakout area. It is now in between its 20 day moving average and 50 day EMA but there could be a bounce here, as it is testing support. If it does bounce the equities market may decline 

The US dollar for the month down 1.7%. 

The dollar's decline has brought it into its breakout area similar to the euro short and we could see a short term rally in just testing this support. 

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