Market Summary For February 1, 2013

The markets in the United States are set to end the week marginally higher on the whole, with surprisingly little volatility given the magnitude of the news and data. More than 100 companies, or 20% of the S&P 500, reported earnings while housing, consumer confidence, GDP growth, manufacturing and jobs data all hit the market at the same time. While earnings remained generally bullish overall, economic data clouded the future for many investors sending the market conflicting signals.

International markets extended their move higher for the most part, with Germany DAX trading up 7.8%, FTSE 100 trading up 9.8% and the Shanghai Index trading up 18.5% over the past three months. However, investors in these markets remain concerned with the eurozone's fragile recovery and the potential impact of Japan's new cheap money policies. If successful, inflation may edge higher in the eurozone and emerging markets.

The S&P 500 SPDR (ARCA:SPY) ETF moved about 0.10% higher early on Friday, extending its rally higher after a small retracement mid-week. Currently, the index is trading above a key 148.86 pivot point and its 50- and 200-day moving averages, with its next upper pivot point resistance level at about 153. Traders should watch for a potential reversal, however, given the extended relative strength index (RSI) and a potentially bearish moving average convergence divergence (MACD) readings. On the downside, the index could see a move back to the 146 to 146.61 level before rebounding.

SEE: A Primer On The MACD

The PowerShares QQQ (Nasdaq:QQQ) ETF moved about 0.19% higher early on Friday, but remains well within its trading range dating back to the beginning of the year. Apple's(Nasdaq:AAPL) lackluster results last week and turbulent earnings this week have kept investors at bay when it comes to technology stocks. Currently, the index is trading above its 50- and 200-day moving averages between an upper resistance pivot point at 68 and above a lower support pivot point 16.38. Traders have little cues from technical indicators, with the RSI remaining relatively neutral and the MACD also rather indecisive.

SEE: Using Pivot Points For Predictions

The Dow Jones Industrial Average (ARCA:DIA) ETF moved about 0.28% higher early on Friday, reaching new highs during the session. Currently, the index is trading above its 50- and 200-day moving averages and its new February pivot point of 137.51. Looking ahead, the RSI suggests that the index may be overbought at its current levels, while the MACD also appears to be heading towards a bearish crossover, which could lead to a retracement down to the trendline and support the pivot point at about 134.81. But, given the bullishness in corporate earnings, traders can still expect an overall long-term uptrend for the time being.

The Russell 2000 Index (ARCA:IWM) ETF fell about 0.59% by early Friday, performing the worst of all the U.S. indexes, after experiencing the greatest rise over the past few weeks. Currently, the index is trading above its 50- and 200-day moving averages, as well as above its new February 88.86 pivot point. With the RSI indicating the index is overbought at current levels and the MACD ready for a bearish crossover, traders may want to watch for a move down to the first pivot point support at 87.40 or even the second support pivot point at 84.73.

SEE: The Anatomy Of Trading Breakouts

The Bottom Line
The majority of the U.S. and international indexes moved higher this week, thanks to ongoing positive corporate earnings announcements and economic data that were somewhat favorable. Looking ahead to next week, traders will be watching for factory orders and ISM manufacturing data on Monday and Tuesday, productivity and jobless claims on Thursday and international trade data coming out on Friday for hints as to the health of the economy.

Charts courtesy of stockcharts.com.

At the time of writing, Justin Kuepper did not own any shares in any company mentioned in this article.