WALL STREET : DJIA up +83.93 on Friday; Down -185.88 w-o-w

Bulls close with a rally for a tough bearish week
The markets were solidly in the green as traders cheered the Group of Seven's intervention to restrain the soaring yen and numerous large banks reinstated dividends and share buyback programs. A rally that sent the Dow gaining more than 100 points lost some of its steam toward the end of the session as traders took profits ahead of a weekend filled with geopolitical uncertainty.

The gains, supported by a rush of dividend announcements from major banks and a decision by global central banks to intervene in currency markets, moderately chipped away at losses of more than 1% for the week.

“This outside risk from Japan, the Middle East and Libya has shocked the market back into its normal trading patterns, with stocks up and bonds down, or vice versa,” said a senior Wall St. analyst.


Wave 4 looks incomplete in the DJIA Weekly EW Chart.
The next 2 candles could possibly comfirm the scenario.
Position traders take note.


The Dow Jones Industrial Average (DJIA) skyrocketed to a triple-digit lead right out of the gate this morning, as investors cheered the Group of Seven's (G7) efforts to cool the soaring Japanese yen. In addition, the financial sector powered higher after the Federal Reserve said "some firms are expected to increase or restart dividend payments, buy back shares, or repay government capital" in the wake of the latest round of stress tests. In fact, banking bigwigs JPMorgan Chase and Wells Fargo didn't even take the weekend before hiking their dividends. Separately, Dow component Cisco Systems issued its own dividend for the first time ever, adding fuel to the blue-chip fire.

However, the bulls lost some steam in afternoon trading, after President Obama warned embattled Libyan leader Muammar Gaddafi that the U.S. was prepared to use force if loyalists fail to obey the United Nations (U.N.) Security Council's orders to cease fire. Nevertheless, all three major market indexes finished with healthy gains, trimming their notable weekly deficits by the close.

The Dow Jones Industrial Average (DJIA – 11,858.52) ended the session 83.93 points, or 0.71%, higher, as 26 of its 30 blue chips settled in the black. Pacing the advancing equities was financial heavyweight JPMorgan Chase, which tacked on nearly 2.7% on the heels of its dividend hike. On the flip side, Travelers (TRV) led the laggards with a loss of 1%.

For the week, however, the Dow surrendered 1.54%, finishing south of its 10-week moving average for just the second time since late August.

The S&P 500 Index (SPX – 1,279.21) added 5.48 points, or 0.43%, trimming its week-over-week deficit to 1.9%. While the broad-market barometer maintained its perch atop its 20-week moving average, the index ended beneath its 10-week trendline for the second straight week. Meanwhile, the Nasdaq Composite (COMP – 2,643.67) couldn't quite keep up with its peers, advancing a modest 7.62 points, or 0.29%.

For the week, the tech-rich COMP surrendered a whopping 2.6%, ending south of both its 10-week and 20-week trendlines for the first time since late August.

TECHNICAL ANALYSIS
Dow Jones Industrial Average
The Dow closed higher on Friday as it consolidated some of the decline off February's high. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. If the Dow extends this month's decline, the 38% retracement level of the June-February rally crossing at 11,339 is the next downside target. Closes above the 20-day moving average crossing at 12,066 are needed to confirm that a short-term low has been posted.

First resistance is the 10-day moving average crossing at 11,963.

Second resistance is the 20-day moving average crossing at 12,066.

First support is Wednesday's low crossing at 11,555.

Second support is 38% retracement level of the June-February rally crossing at 11,339.

HAPPY WEEKEND