December 5th Stock Market Recap and Stocks to Watch

We made it through the week filled with bad economic data releases practically unscathed. After all the wild swings the Nasdaq and S&P 500 ended the week down 1.7% and 2.25% respectively. That’s not so bad considering how bad the data was and how volatile the market is these days. A 2 percent move can be made in a flash in the current environment.

Here’s a shot of the weekly S&P 500 chart which shows the sideways movement of the last 8 weeks.

The S&P daily chart shows that the index just barely broke its September trendline on Friday. That trendline breach along with the inability of sellers to break the market last week make me think that the path of least resistance in the short term is up. The index could rally as far as 1,000 and still just be range-bound though.

It’s a similar story for the Nasdaq. I think its likely next targets are 1600 or its 50-day moving average.

The VIX was relatively calm last week and slipped under its 50-day moving average on Friday. It still has a long way to go to get back to normal levels though.

I’m starting to see more charts like BorgWarner Inc. (BWA), which is almost pinned to its 50-day moving average.

Here’s another 50-day moving average play — priceline.com Inc. (PCLN). I like it above the blue trendline.

EMC Corp. (EMC) closed above its 50 DMA for the first time since early September.

Nabors Industries Ltd. (NBR) is a good example of a lot of charts I’m seeing, especially oil stocks. It made a hammer-like candle on Friday after an attempt to breakdown below its 2008 lows. These type of charts seem ripe for bottom fishing (not my thing!) and I’d be tightening up my stops if I was short a stock with a chart like this.

Here’s one for the gold bugs. Newmont Mining Corp. (NEM) is very similar to the Priceline setup above. I’m also watching this for a trendline break.

All the short term trends are up again…