The week unfolded as predicted.  Commentary from “THE WEEK THAT WAS” published on 3/14/2009.

  “I feel that we could pause or slow down for a few sessions before continuing up to challenge 780-800 in the SPX”

  In fact, my chart analysis of 3/14/2009 on the SPX indicated that resistance was at 804.  The index paused only briefly on Monday and then made a high on Thursday 3/19/2009 at 803.24 and then retraced.

So where are going from here?  The next stop should be a retest of formally strong support at 741 in the SPX.  If we get a bounce, it would be a good entry point for a move back up.  There is also good support at the 2/27- 3/2 gap at 730-735.  Should those levels fail then we could continue down to retest the 3/6 low of 667.

The market on Monday spent most of the day in positive territory, only to retrace and finish down 7 points.  One could expect a pause after the furious rally this past week.

Tuesday, the market keyed off of the unexpectedly positive housing starts numbers.  Large negative sentiment regarding AIG and the TARP funded bonuses to “fat cat” executives in the insurance company.  Even so, the DOW closed up a healthy 179 points. 

Wednesday was FOMC day and they didn’t disappoint announcing their plans to buy billions in treasurys and mortgage backed securities.  The DOW gained 91 points.

Thursday, investors took profits as a plethora of less than stellar economic news prevailed.  The DOW closed down 86 points.

The week ended with the DOW continuing its’ decline from Thursday’s action, closing down 122 points.

Week over week, the DOW was up 55, the SPX better by 11 and the COMPQ gained 25.

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