Sam Collins

Trend Still Down Despite Rally

by Sam Collins   06/26/09

In the absence of a dramatic high-volume breakout above 956, it is likely that even a sideways pattern will develop into a head-and-shoulders with a neckline (breakdown) at 880. I am not predicting that this will occur, but I think it important to alert our readers to the possibility so that they may take immediate action and sell hard on the breakdown.

On the bullish side, it is unlikely that the tepid volume that has accompanied almost every advance will be able to generate enough momentum to accomplish a major breakout. Thus, in the absence of a breakout or breakdown, the current pattern could continue through the summer.

Today's Trading Landscape

Earnings to be reported include: AZZ Inc. (AZZ), Gerber Scientific (GRB), KB Home (KBH), Logility (LGTY) and Shaw Communications (SJR).

Economic reports due: May personal income (the consensus expects +0.2%), May personal spending (the consensus expects +0.4%), DJ-BTMU Business Barometer for June 13, and end of June Reuters/University of Michigan sentiment index (the consensus expects 69).

---

Get Sam Collins' Daily Trader's Alert e-mailed to you each morning before the opening bell absolutely FREE!

In addition to getting instant access to his Daily Market Outlook, you'll also receive his Trade of the Day in the same e-mail so you can start your day off right by positioning yourself for profits!

Sign up today for Sam's FREE Daily Trader's Alert today!

Sam Collins is a registered, fee-based portfolio manager who may be contacted at samailc@cox.net. You can also check out an archive of his most recent market outlooks.