The Index Trading Weekly Newsletter Is now accessible directly from an RSS Feed. If you have a My Yahoo account or an My Msn account go to the Weekly newsletter page to register and you will be advised immediately when changes occur on the site either with trading signals, weekly newsletter or any other changes on the site. You can also create a new entry in an RSS reader. Click Here to register for RSS Feed Please note that the next number will be August 26th. Resistance Resistance All markets found strong resistance (SP500 at 1280 and DOW at 112100). We are now facing heavy resistance at 1280 for SP500 and 11210 for DOW. Nasdaq was rather weak in the past 2 weeks but 1450 may be the foundation for a strong push for the fall season. All sectors weakened a little. SP500 pulled back from upper band and facing heavy resistance at 1280. In fact SP500 is now stuck in 1220-1280 trading range. ND100 weakened again and trying to establish support at 1450. DOW pulled back from upper band facing heavy resistance at 11210 which is the higher end of trading range 10650-11210. Resistance Resistance Last trades update Index Market Last signal Entry date Entry Price Current Price Win / Loss 2 weeks Change # cycles completed SP500 Buy June 19th 2006 1240.13 1266.74 26.64 -11.81 1 ND100 Buy June 1 2006 1616.57 1486.74 -129.83 -23.56 2 Dow Buy July 11 2006 11134 11088 -46 -132 1 SP500 Last Signal Comment Our last buy signal is now 27 points ahead. SP500 is now facing heavy resistance at 1280 the top of the 1220-1280 trading range. 4 times we had break out attempt but every time it pulled back inside 1280. The new cycle is now 19 days old already. We might have a sell signal anytime soon. SP500 is now near the moving average. A possible short term upswing to the high end of the trading range is possible. We are now in a sideways market pattern. The possibility to see in this cycle an attempt to reach year high of 1325 is now quite remote considering that we are in the worst period of the year (august-september). 1220 is now our first support. 1170-1180 support level is our second support level. Our next support is at 1140. ND100 Last Signal Comment Our last buy signal is now 130 points behind. ND100 quickly turned lower again and is now in the way to retest 1450 support (current year low). This support line however may be the base to a strong push in the fall season. For now it remains weak with little hope of a short term upswing. This market is hit quite hard this year which means we could have a very strong fall season with this market. We can consider that our first support is now at 1400, our next support at 1320. DOW Last Signal Comment We had a new buy signal on July 11. We are already behind 46 points with this buy signal. This was a very bad call but we are near the profit zone. DOW like SP500 is facing heavy resistance at 11210. Many break out attempts have been made but unsuccessfull. It is now near the lower band. So like SP500 either we get a sell signal soon or we have a reattempt to 11210 in the coming 2 weeks. The possibility to see an attempt to reach year high in the coming weeks is quite remote considering we are in the worst period of the year (august-september). Our first support is now at 10650 and our next support is at 10200. Special Option Strategy Update Our August 1170 PUT sold at 2.90$ now worth 0.25. We are safe now with just 1 week before expiration. We will let this contract expire before any new commitment with this strategy. Always remember that you need between 11,000 and 15,000 USD margin for each contract. Short term Options Welcome to this new trading service. With this service we should have every month good opportunities. Click here to find the options trading signals page. No new trades occured in the past 2 weeks. SPX and DOW are at the moving average now and could possibly be entered if we have a bad week. ND100 is about 36 points away. BBH is only a few points away to be triggered as well. All other markets are far from being triggered. We now have new target numbers for all our covered markets. See full instructions on options signals page for more details. Please use the link mentionned above to see the target numbers. Check every day on the page to see if the numbers are changed. Of course we are far from a possible entry for now but we never know. Economic Current Conditions Table of Economic Numbers Economic Info July 2006 Juin 2006 May 2006 April 2006 Mars 2006 February 2006 January 2006 December 2005 November 2005 October 2005 September 2005 August 2005 July 2005 PPI +0.5% +0.2% +0.9% +0.5% -1.4% +0.3% +0.6% -0.7% +0.7% +1.9% +0.6% +1.0% Core PPI +0.2% +0.3 +0.1% +0.1 +0.3% +0.4% +0.1%- +0.1% -0.3% +0.3% +0.2% Retail Sales +1.4 -0.4% +0.1 +0.8% +0.6% -1.4% +0.7% +0.7% +0.8% +0.3% +0.2% -2.1% +0.3% CPI +0.2% +0.4% +0.6% +0.4 +0.1% +0.7% -0.1% -0.6% +0.2% +1.2% +0.5% +0.5% Core CPI +0.3% +0.3% +0.3% +0.2 +0.1% +0.2% +0.1% +0.2% +0.2% +0.3% +0.1% +0.1% Housing Starts 1.85M 1.953M 1.863M 1.96M 2.12M 2.28M 1.933M 2.12M 2.02M 2.13M 2.04M 2.042M Building Permits 1.862M 1.946M 1.98M 2.06M 2.15M 2.22M 2.08M 2.16M 2.10M 2.22M 2.14 Millions 2.167 Millions Employment +113,000 124,000 92,000 126,000 200,000 225,000 170,000 140,000 305,000 44,000 -35,000 211,000 242,000 Durable Goods Orders +3.1% -0.3% -4.7% +6.1% +3.4% -10.2% +2.5% +3.3% +3.0% -2.1% +3.8 Durable Goods Excluding Transportation +1.0% +0.7% -1.1% +0.6% +4.2 New Homes Sales -3.0% +4.6% -4.9% +18.0% -5.5% +2.9% -10.71% +12.9 +2.1% Existing Homes Sales 6.62 Millions 6.67 Millions 6.75 Millions 6.92 Millions 6.91 Millions 6.56 Millions 6.75 Millions 6.97 Millions 7.09 Millions 7.29 Millions 7.29 Millions ISM Index(Manufacturing) 54.7 53.8 54.4 58.9 55.2% 57.2% 54.8% 55.6% 56.6% 59.1% 59.4% 53.6% ISM Services 54.8 57.7 60.1 63.0 56.8% 61.0% 58.9% 60.0% 53.3% 65.0% Factory Orders +1.2% +0.7% -4.5% +1.1% +2.2% -1.7% +2.5% GDP(Gross Domestic Product) Numbers 2nd Quarter 2006 1st Quarter 2006 4th Quarter 2005 3rd Quarter 2005 2nd Quarter 2005 1st Quarter 2005 2.5% 5.6% 1.7% 4.3% 3.3% 3.8%(revised) Inflation Numbers 4th Quarter 2005 3rd Quarter 2005 2nd Quarter 2005 1st Quarter 2005 4.07% 4.3% 2.4% 3.1% In the last 2 weeks we had several major economic news. See the table above for all numbers. July retail sales were up 1.4% higher than expected. ISM services came in for july at 54.8 lower than expected. ISM manufacturing was at 54.7 for july lower than expected. Factory orders were up 1.2% inline with expectations. Employment for july was at 113,000 much lower than expected. Most numbers except for retail sales tend to confirm the current economic slowdown which is now recognized by the FED who decided to halt rate hikes. The crude is now near 74$ after a runup above 76. It is starting to be a concern for economic growth now. The prime is now at 5.25. FED decided to stop rate hikes for now. Apparently the vote among FED members was divided. They said they will continue to look at economic data to make later decisions. So possible future rate hikes remain possible. The SP500 PE ratio is at 17.44 according to march results. We can almost say that for june estimates we are at about 17.10 which is still considered very low. Remember that when the last major economic cycle that started in march 2003 the PE ratio was at around 16. So we are at the low end. Despite the fact the PE is not too high we will have to watch for a possible bear market later in the fall for the coming year. Our last major bear market was on july 2002.