The Week Ahead: Many reports on economic activity will impact the markets this final week of the traditional summer season ahead of the Labor Day weekend. On Tuesday the August consumer confidence index is out. Wednesday the 2nd quarter GDP is released. Thursday brings July factory orders along with personal income and spending. Finally, Friday has another big employment report which will influence fed policy in September and the July construction spending is released.

Stocks to Watch: Mortgage lending stocks softened on recent weak housing numbers. H&R Block (HRB) broke down after its mortgage unit warned of growing delinquencies. Other mortgage companies that look weak include CFC, NDE, NEW, and NFI. With natural gas prices on the rise again, companies like Pogo Producing (PPP), XTO Energy (XTO), Newfield Exploration (NFX), Frontier Oil (FTO), and EOG were all upgraded and appear on the upswing.

Special Note: Generally , the days leading into a holiday are bullish and traders can position to take advantage of stocks in sectors that are outperforming or have displayed recent momentum. Portfolio rebalancing is also a good idea this time of year making sure stock, bond, and cash positions are weighted according to one's investment objectives especially ahead of what promises to be a highly volatile Fall season and a potential 4 year cycle low pattern forming.


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