Weekly Watchlist 9/14

Going into options expiration week the SPX finished last week at 1042 after hitting new highs on the year. The levels on the downside that have and should continue to provide support on the SPX are 1027, 1014, 994. On the upside I am looking at 1052, 1080, and 1100 to come into play if this market breaks out. It does seem like we are in the latter stages of the rally since March because the market feels fragile but that does not mean we cannot see one more burst to the high side into the end of 3rd quarter for the next few weeks.

The commodities like copper and oil had sort of an ugly reversal on friday and the dollar strengthened a bit late. Whether this leads to more continuation this week we shall see but the trend is certainly pointing the other way for now. Another sector to watch of course is the banks (XLF) as they did not make new highs last week as the broad market did. This could be a warning sign going forward as banks need to participate if the market is going to rally to new highs. Retail will be in focus this week as investors try to gauge the strength of the consumer when BBY reports Tuesday.

The Watchlist:

Longs>>> BKE, ODP, SVA, RIMM, ACI, SBLK, GMCR

Shorts>>> ICE, ERTS