The Weekly Report For January 19th - January 23rd, 2008

January 18, 2008- Market Summary
The influential levels of resistance that we mentioned in our previous report held up like many active traders were expecting. The question becomes whether we are going to see the major indexes retest their November lows. As you can see from the charts below, the indexes have been on a steady decline since failing to move above their short-term trendlines and we expect that these levels will continue to be watched carefully by active traders as earnings season rolls on. Many active traders will choose to wait on the sidelines until the volatility associated with earnings season tapers off, but for those risk seekers out there, now will likely prove to be a good time to be looking for opportunities. The chart of interest this week is the Nasdaq because it broke below the support of a rising wedge formation. Friday's doji candle suggests that sellers are starting to jump back in, so it wouldn't be surprising to see the markets move lower at the start of the week. This chart pattern is commonly found in a downtrend and often signals a period of consolidation before a breakdown triggers a resumption of the selling pressure.

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