President George Washington.   Washington was elected President as the unanimous choice of the 69 electors in 1788, and he served two terms in office. The US stock markets are closed on Monday in honor of this President who was actually born  on February 22. Instead of having separate holidays for other presidents, the day is now also to remember  all US presidents, living or not. Have a great day off!

This past week the markets were not able to break up or down from the fairly tight range. The bears had opportunities to try and drop it but as the markets got to short term supports there were no efforts in selling it so the buyers easily brought it back in each case. There was no build up of new lows and in fact the number of new highs increased. Below you will also note the the midcaps and especially the small caps led the major indices and this is considered as bullish. There are a couple of reasons to be cautious. One is that stocks have been going up so long with out much of a rest and another is that seasonally this can be a weak period. So many would like to see a pullback and there is a chance of that during this short trading week.  

(I will be going out of town on Wednesday to a MAYO clinic  to determine the course of treatment for this cancer so there will not likely be updates to the watch list this week after Tuesday night)

Before we get to the  charts - a  music video.  We like to share videos that distinguish themselves in some way. Today we have two videos that share a common theme. Both are foreign artists who do not use English as their first language but who have decided to sing mostly in English.

Cocoon is a two-piece French band formed in 2006 by Mark Daumail (born 1984, composition, lead vocals, acoustic guitar, ukelele, banjo, beatbox, etc.) and Morgane Imbeaud (born 1987, vocal harmonies, keyboards, arrangements). “I wanted it to be a male-female duet. A duo like the White Stripes are in rock — we wanted to be the equivalent in folk music,” Daumail says. Their songs are entirely sung in English.  This is a song that draws you closer to it after multiple listenings.

Their website  and facebook

In the morning I'll go down the graveyard
To make sure you're gone for good
To make sure you won't hurt again
May you rest in peace

Pony riding, sushi cooking
I'll may you be where you wanted
Oh we talked about it
After 1 or 2 beers

And the worst days that life brings
All the bad movies and all the earthquakes
All the worst days are just buried into the snow

Holy water
Plastic flowers
In the end you got what you got what you are
Always running after, always running after

And the worst days that life brings
All the bad movies and all the earthquakes
All the worst days are just buried into the snow

And the worst days that life brings
All the bad movies and all the earthquakes
All the worst days I've just buried into the snow
(bis)

Retail sales in the U.S. saw a modest increase in the month of January, according to a report released by the Commerce Department. The report showed that retail sales crept up by 0.1 percent in January following a 0.5 percent increase in December. The modest increase in sales matched economist estimates. Excluding a 0.1 percent drop in sales by motor vehicle and parts dealers, retail sales rose by 0.2 percent in January compared to a 0.3 percent increase in December.

Business inventories edged up 0.1% in December to a seasonally adjusted $1.62 trillion, the Commerce Department said Wednesday. That's a 5.1% gain compared to Dec. 2011, and the ratio of inventories to sales was 1.27, down from 1.28 in November. November's inventories growth was lowered to 0.2% growth from a 0.3% gain.

The February 2013 Empire State Manufacturing Survey indicates that conditions for New York manufacturers improved for the first time since the summer of last year. The general business conditions index rose into positive territory, advancing eighteen points to 10.0. The new orders index also rose sharply, climbing twenty points to 13.3, and the shipments index increased to 13.1. The prices paid index pointed to a continued acceleration in selling prices, and the prices received index, while positive, inched lower.

American industrial production fell in January after two months of solid growth. The momentum was temporarily blunted, because production of autos and auto parts posted a big drop. However, the auto industry is coming off its best year for sales in five years, and economists expect production to rebound in February. Output at U.S. factories, mines and utilities slipped 0.1 percent last month, figures from the Federal Reserve showed Friday, after gains of 1.4 percent in November and 0.4 percent in December. The median forecast in a Reuters survey called for a 0.2 percent rise. A steep 3.2 percent drop in motor vehicle assembly contributed to the decline in the headline figure. But the drag will likely be temporary. Cars and light trucks sold at a 15.2 million annual rate in January, down from 15.3 million in December, data from Ward’s Automotive Group showed. Including November’s 15.5 million rate, auto sales over the past three months have been the strongest in five years.

With the non-inflation-adjusted Dow is trading 1% below its all-time record high, today's chart provides some long-term perspective with a chart of the inflation-adjusted Dow since 1900. Of interest is that the inflation-adjusted Dow has traded within the confines of an extremely long-term upward sloping trend channel over the past 113 years. It is also of interest that the secular bear market that concluded in the early 1980s was almost as severe as the one that concluded in the early 1930s. Also, while the market action from the inflation-adjusted record high of 1999 to the financial crisis lows of 2009 was severe, the magnitude of this decline was much less than what occurred with the bear markets that concluded in the early 1930s and early 1980s. More recently, the Dow has retraced most of the financial crisis bear market though the inflation-adjusted Dow currently trades 10.6% off its 1999 record high. While the inflation-adjusted Dow is not quite as near record highs as is the non-inflation-adjusted Dow, the post-financial crisis rally would have to be considered a rather dramatic turn of events -- inflation-adjusted or not.

 This past week's  sectors.

This past week's indices  -   

We are now halfway through the month with all the major stock indexes on the plus side and over breakout lines. While oil looks to be consolidating and gold clearly under the center Bollinger band.

Usually when we look at the 60 min. multi-index charts we expect this  movement between the lower and top Bollinger bands, as it exceeds one side and then moves to the opposite side. The chart however for the last couple of weeks, though in a fairly tight range on the Dow, has been rather amazingly dynamic in moving from top to bottom bands every couple of days. This may be good if you are a nimble trader but it does not make for a very predictive chart. 

The 30 year Dow chart could start a long and successful move higher if it ever will break above the 14,200 level, especially on very strong volume. 

We have now had two weeks of consolidation after the two week move above resistance and the volume has been lower  which actually may be good  as it builds up the charge to move higher. 

If you like a wide range the last couple of weeks have not been for you as the Dow has been pretty flat. The 20 day moving average was tested on Friday and it held so perhaps this coming week we can finally breakout this range. Of course the break could be on the downside, though the chart is still looking quite bullish. 

In this view we see the overhead resistance at the 127.2% Fibonacci projection is also the lower of the top two parallel channel lines. Over time if the first one is exceeded and the movement is slow we could see a meeting of the top parallel channel line as it connects to the 161.8% Fibonacci. 

A shorter timeframe look at the Dow futures and a rough ascending parallel channel it has been in all of this month. The lows for the week held on a retest and it closed back inside this channel on Friday. Above the 127.2% at 14,009, we have a short term projection at 14,066. 

The Dow Jones utility average had run right into the downtrend line, in fact went over it a bit, and then dropped quickly on Thursday. It hit the 20 day moving average and we saw a bounce on Friday. 

The transportation average yet again moved higher by .59%. 

The NASDAQ summation index came pretty close to its 5 period EMA but has been able to hold above so a  continued long for the NASDAQ. 

The moving average of number of new 52-week highs on the NASDAQ continued higher which is of course bullish. 

For the week the NASDAQ lost a point as it had run into horizontal resistance. 

We showed that horizontal line 2 weeks ago for the NASDAQ and it remains hugging it quite closely also inside an ascending parallel channel. 

On the daily charts based on the range from the late summer high to the November lows, the 127.2% Fibonacci projection is at 3300 which comes into play after a close above the roughly 3200 level. 

The NASDAQ 100 futures have remained now above the 127.2% level for some time with high odds of reaching the 161.8% at 2797 short term. 

The NASDAQ 100 ETF produced one red bar, but that was not enough to alter the long position started at the beginning of the year. 

The volatility index remains very low at 12.46. 

The semi conductor index actually did quite well on its second week above the downtrend line and added .87%. 

The NYSE new highs minus new lows  stayed above the horizontal channel which is bullish and it is not overdone, which is not threatening. 

78% of stocks on the NYSE and now trading over their 50 day moving average which is basically just at that red top line. If it moves  moves below it would be cautionary for stocks. 

The very simple lazy trading chart has advanced about 90 points from that last buy signal in December. 

The S&P 500 bullish percent briefly dipped below the 5 period EMA which would create a sell signal though it recovered within a day but is worth noting as it is at least cautionary. 

On the daily S&P 500 we see the week's sideways movement, which is not too interesting though this chart also shows a 161.8% projection up near 1555 that could be a longer-term target. 

On the 60 min. chart you see the price remaining inside the channel which was started in late November. RSI has been dropping since its peak it the last weeks of January but remains at the close above the 50 level. 

On the 15 min. chart we see a bounce on Friday right at this bottom short term trendline. 

From our stockharts public page the S&P 500 mechanical chart had its largest gain this month on the seventh and eighth which was an upward move. On this chart the S&P 500 remains on a short term sell until there is one additional green bar. 

This view of the S&P 500 shows the length of the first leg from June until September and now the third leg which began in November. The dotted lines are of equal length and if leg three will equal leg one, you can see the move will take it up to just over 1550. Overhead right now from the range shown, we have a 127.2% Fibonacci level at 1532. RSI at the moment is elevated at 73 which does not mean that it has to drop but it is in overbought territory. 

This chart shows the SPY with its measured move target up near 155. Note how the poll back into mid November was right to the 61.8% Fibonacci retracement. At that point RSI had gone under 30 and then went over 30. Exactly as it had done at the June buy point. This shows how important it can be to pay attention to the movement of RSI in relationship to other factors as well. 

We have some variants of the Russell 2000 here. In this first one the price has now exceeded the parallel channel as drawn and it is not far off the 161.8% projection at 935. If we get a movement up to that level we would suggest being quite cautious short term. 

Using the longer-term view of this Russell 2000 range from last April's high to the late summer lows, we have a separate Fibonacci projection which corresponds to this rough parallel channel at a 127.2% near 943. 

And here our normal daily view which also shows that 982 level. Pay attention to the brown  trendline as well as that is an important level it needs to  hold for any longs. There is still some negative divergence in the MACD and the histogram is still slightly negative. 

This 60 min. Russell 2000 shows this trendline as well and the short term moving averages that it is still above at the moment. 

On this chart of the Russell 2000 3-X ETF we have two sets of Fibonacci projections based on different timeframes and on Friday we reached the longer-term 161.8% at $82.32. This shorter term 161.8% is not far away at $83.29. This is really a very steep move up so it is prudent to be cautious. 

This 480 min. chart shows the ascending parallel channel. it has been in all year. 

The 30 year bond price had rallied back to the 20 day moving average and then dropped again this week. 

The banking sector index had made it to this 161.8% projection and has backed off from there as RSI had again reached 70. If it continues dropping watch the 20 day moving average for  possible support. 

The retail sector remains  okay as it is in consolidation mode sideways after the two week rise in January. 

The emerging market ETF had dropped back to test the horizontal breakout line and so far remains at it.

The Dow Jones world stock index ran over the 2011 high by seven cents and has backed off slightly from there. 

The London FTSE which had pulled back in the previous week gained back about 1% of that this week. 

The Shanghai stock exchange as been consolidating as it should but has that May high to contend with not far overhead at 2454.

Our commodity ETF having produced a sort of flagpole after it's break up towards the 200 week EMA,  has now spent two weeks with very minor decline which could shape up to be a bullish flag. 

Crude oil ran into the long-term downtrend line and has been pretty flat. 

On the weekly view you see 0.5% gain this week after last week's red candle. 

Crude oil futures for quite some time has been hanging around that 50% retracement level with just minor movements this month. 

Natural gas this week closed below the 50 week EMA and is back inside the channel it  broke out of in the early autumn. 

The natural gas futures shows some possible support near at $3.10 worth watching as that was the very nice bounce point in early January. 

Gold was down 3% for the month and is clearly under the 20 month moving average. There is a multiyear trendline closer to 1400. Note even if that were hit in the future it would be not be done quickly. At the same time it would also likely be a very good buying opportunity. 

When you look at the gold daily chart you see the biggest move of the week was on Friday as the moving averages also had just crossed over bearish. RSI though is now becoming oversold as we will show in the next chart. 

On this daily view you see the high volume gold did on the drop on Friday but we also have a dotted possible support line short term which coincides with a bottom parallel channel line. So even though the chart is quite bearish having dropped below the 61.8% Fibonacci projection, we could see at least a short term bounce as we did the last times RSI had gone this low. 

In the past this GLD as been quite bearish as it dropped below the parallel channel line in the summer and then rallied back up to test it from below, which made an additional short and now is broken below this bear flag.

The gold miners ETF has also pulled back to this trendline to test it from above and if it breaks below, it very quickly will run into the possible bounce point near 38  where it twice before bounced and made significant moves. 

The gold miners ETF having gone short last September had 5 five e whipsaws until the latest short at the beginning of the year. Since then it has dropped nicely and is not that far off the lows seen last May. 

Silver had been holding up better than gold but ran into this moving averages and also lost a lot this week, dropping 5% down to test this trendline. 

The SLV mechanical chart with this drop shifted back to a sell.

Copper after forming a bullish flag pole is now making what appears to be a bull flag. 

Palladium had pulled back only slightly in consolidation in the previous week and this week had a plus side of at about the same. 

The euro which had broken above the 200 day EMA and horizontal resistance had also gone above the top Bollinger band. This made it overbought and it has pulled back so far testing the 200 week EMA. A bit under that we have been an trendline, which may be support. 

And here a longer-term view of the euro futures and it's rise from the low up to and above the 50% retracement level and the current move which may bring it down to test again the dotted  up trendline. 

For the month the US dollar is gained 1.73%. Bouncing right at that triangle trendline. 

And here the dollar's weekly view closing over the 50 week and 200 week EMA's. 

And the daily view of the dollar. 

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