The Bulls chalk up two more record highs.

Last Friday a stampede of Bulls managed two more record highs to add their impressive collection of records this year.  As great as that is, please keep in mind both the DIA and the SPY must still prove that the broken resistance will serve as support if tested.  I suspect as 3^rd quarter earnings ramp up there will more volatility in price action ahead, both bullish and bearish.  With the VIX only pennies away from new record lows it would be wise to remember very fast price reversals are not out of the question.  Every trade needs a plan that includes exit strategy before entering new positions.

On the Calendar

Other than some bond settlements. Announcements and auctions there is only one report of significance on the Economic Calendar today.  The Empire State Mfg Survey comes out at 8:30 AM Eastern Time.  Last month the number came in very strong with a reading of 19.8 indicating confidence in manufacturing growth for the next six months.  Forecaster saw this was an anomaly and expect the number to come in around 15.0 for July, which is still very strong.

There are 24 companies reporting today with the biggest name being YHOO coming after the bell.  With the recent weakness in the NASDAQ, I would expect the YHOO report heavily focused on by the market.  It could be an interesting one to watch at the end of the day.  Please make sure you are checking earnings report date on everything you own and everything you buy as part of your trade planning.

Action Plan

Friday was a very good day for the Bulls.  Not only did they manage to push the DIA into new record high territory but managed to break resistance on the SPY setting yet another record.  The IWM tested resistance but shrank away from it before the close, and the QQQ’s managed it’s 6^th day up to challenge resistance levels.

Currently, futures are pointing to a higher to a slightly open this morning.  It would be nice to see the market continue on the bull run but after such a strong day on Friday, a rest or slight pullback would not be out of the question as well.  With that in mind, I will be looking for new long trades today.  However, I will likely give the market about 30 minutes after the open before making any decisions.  Of course, as always, the first order of business will be to manage current positions.

Trade Wisely,

Doug