The Week Ahead: With retail sales down in June well below expectations and consumer sentiment falling, consumers are feeling squeezed between rising energy costs and a weakening real estate market. Rising wages has the fed likely to raise rates again in August, but much will depend on Monday's June industrial production, Tuesday's June PPI, Wednesday's CPI and housing starts, Thurday's
Ben Bernanke testimony to congress, and Friday's leading economic indicators.

Stock to Watch: Citigroup (C), a barometer of the banking sector, reports 2nd quarter results on Monday. The stock just closed through its 200 day moving average and appears to be hinting at further weakness. With GE reporting solid 2nd quarter numbers and sales up 9%, a halt to its recent slide looks close at hand near the 31 level. Finally, Pepsi (PEP) appears headed higher based on a resilient uptrend and a report of excellent earnings.

Special Note: A resumption of the downtrend that started in May has begun after another top on July 6. Investors should use caution positioning any longs in stocks at current prices. Another market bounce is likely by next month as oversold levels approach ahead of the Fed August 8 meeting. With the yield curve flat and an 85% chance of recession when this occurs, the market may in fact be discounting the possibility of an economic slump starting over the next year.


Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.

Click here to open an account.
NobleTrading Direct Access Trading