S&P Recap: 5/27/11

Good morning futures are up over 11 points this morning, the EUR is up .75% against the USD on the the bailout of Greece and a report of decreased eurozone inflation and there is a 3.2Billion dollar deal announced as well as Asland is buying a chemical producer.

On Friday the mood was good as well due to news that EU banks may be able to avoid part of the new capital requirements. But Fitch's had downgraded Japan's credit outlook and that was keeping a lid on futures. Econimic data came out at 830am showing personal Incomes rose by +0.4% in April, which was in line with the consensus expectations for an increase of +0.4%. The March level was revised lower to +0.4%. Personal Consumption for the month rose by +0.4%, which was a tenth below the expectations of +0.5% and also below the March revised reading of +0.5% The Core PCE (inflation) came in up +0.2%, which was above expectations for +0.1%.

Friday's session began with an upward gap and proceeded to move up but reversed at 10:00 am to test the morning lows. After a quick successful test, the SPX moved higher and put the high of the day on the chart at 11:23 am. Traders seemed to leave for the weekend as the rest of the session drifted slightly lower. It was a tight range low volume session but the indices held their overnight gains.

So we have had the fourth consecutive down week for the SPX but the total losses when all said and done were minor, SPX only losing 32.51 points and th the total losses for the past three weeks have been a paltry 9.10 points. The Advance/Decline Line has increased by 2,688 over the last three weeks! Breadth is advancing while the market is declining; this is often a bullish sign.

MSI still at the bottom end of range

Volume Friday was among the lowest of the year; even lighter than Thursday. While the intraday volume pattern Friday shows increases in volume on the market down moves it is difficult to place much of a value (significance) due to the dearth in volume. Looking at the Breadth Indicators once again they show mixed bag, which may be due to the choppiness we have had. Its is strange though that the MO (McClellan Oscillator) has managed to climb three quarters of the way up in its range while the MSI has done nothing, don't know what to make of this.