The market was volatile last week and ended flat. The Dow ended the week down 44.37 points; SPX added +2.55 points; Nasdaq gained just +0.43 points. Since the market was swinging from side to side very fast and was range-bound, we did not make too many trades.

However, once again, we ended with 100% GR$$N on our closed trades:
7/31/08
CNX ($75.5)
CNXTO, Aug 75 puts, at $4.5, +7.1%

PNC ($72.8)
PNCHU, Aug 67.5 calls, at $6, +25% (partially out)

BIDU ($347.3)
BPJHJ, Aug 350 calls, at $14, +40% (partially out)

We were a little too careful on our CNX put trade, which would have given us a double on Friday! Those CNX august puts ended at $8.3, bidding at $8.6!

The trades left open were:
FSLR ($284)
HJQHA, July 300 calls, at $6.3 (open)
Friday close: $4.3; unrealized gain/loss: -31.7%

QCOM ($54.7)
AAOHX, Aug 52.5 calls, at $3.25 (open, avg cost $4.28)
Friday close: $3.4; unrealized gain/loss: -20.5%

BIDU ($339)
BPJHJ, Aug 350 calls, at $10 (open, partially out)
Friday close: $9.59; unrealized gain/loss: -4.1%

PNC ($70)
PNCHU, Aug 67.5 calls, at $4.8 (open, partially out)
Friday close: $5.4 (bid price); unrealized gain/loss: +12.5%

Let’s take a look at the market to see where things stand after Friday’s session.

Market Forecast
SPX

SPX added 7.07 points to close at 1260.31. It closed below its 30-day MA, but stayed above its 20-day MA. Its MACD went higher.

Nasdaq

Nasdaq lost 14.59 points to close at 2310.96, above the 2300 level. It also closed above its daily MAs. The MACD continued to go up.

The market is fighting to make this recovery stick. Nasdaq tested its daily upper BB last week and its 10-day MA has gone above the 30-day MA. The 20-day MA has turned up. SPX, on the other hand, is seeing the 10-day MA above the 20-day MA, but, was held under the 30-day MA. What the market needs now is a solid jump, a big GREEN day, to catch the daily upper BB to allow the market to continue higher. For the new week, we have the Fed meeting on Tuesday. I think the Fed will likely leave the rates unchanged. The financial markets are a bit too nervous right now for the Fed to make any changes.