Before we get to our weekly ahead analysis, Top Equity News read a very interesting observation from Goldman Sachs on Zerohedge.com (great site -just don’t pay much attention to some of the tinfoil hat crowd in the comments section).
According to Goldman, companies that have beat earnings and sales estimates have outperformed the S&P by 2% in the week following the profit announcement. Investors with deep pockets, or options expertise, might consider buying the beats and shorting the index against it. Two percent a week – you do the math.
We will do our best to monitor earnings announcements and point out the qualifying companies for you in the days ahead as finding strategies that work could be difficult in the days/weeks ahead.
TEN sees things getting very difficult for bulls as our main models have turned bearish, economic news reports are sour, Europe is on the verge of electing socialist who promise to ignore in place austerity measures, and the index charts are flashing technical sell signals.
Bullish momentum has stalled and leadership stocks like Apple Inc. (AAPL) are falling apart. They probably go hand-in-hand, but it’s hard to imagine the market heading higher without the tugboat stocks pushing/pulling the markets higher.
Stocks certainly will have limited upside if the economy continues to produce poor performance numbers like Friday’s disappointing Employment Situation Report. With the exception of Tuesday’s ISM Manufacturing announcement, most recent reports have failed to live up to expectations. Wall Street can only fly in the face of Main Street for so long before reality kicks in or QE3 is unleashed. Right now, Ben Bernanke and the Federals are withholding the easy, free money fix.
Greece and France shook up the EU’s political terrain. Socialist Francois Hollande takes the reins of power in France, and anti-bailout righties and lefties assumed more power in Greece. The new leaders in both countries promise to tax and spend more versus the current austerity path.
Our list of worries concludes with the S&P and NASDAQ charts breaking down. Both indexes managed to find their way under key support levels on Friday. Additionally, TEN sees bearish MACD cross-under on both charts. In all likelihood, the NASDAQ is headed to 2900ish, the S&P to 1340ish, and the Dow could make a home at 12,700ish.
If the big bad wolf shows up and blows the three projected support levels away, technicians and computer programs will see the violations as a HUGE sell signal. If the houses at 2900, 1340, and 12,700 don’t hold up, the indexes could give up most, if not all of 2012’s hot start.
Stock Market Trends: Four Things to Worry About in the Week Ahead is an article from: 
