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MV Traffic Report: S&P Tries to Break Through 980 Roadblock

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Rain or shine, we review the day's biggest stock stories.

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The news of the day was that June new home sales posted an 11% jump, to 384,000 units, compared to consensuses estimates of 352,000. The report was initially seen as a game-changer on Wall Street, but it now seems like just another better-than-expected number.

Why? New home sales are still down 21% year over year, and new home sales only account for 7% of total homes sales in the US. Basically, there's still a lot of supply in the housing market.

The S&P 500 traded in a narrow trading range of 10 points between 972 and 982 and closed up 0.30%, to 982. Once again, the S&P failed to break out of the 980 level, which is the new level of resistance.

Today on the Buzz and Banter, Professor Jeff Cooper gave his thoughts on why S&P 980 is so important.

"Better than expected new home sales has failed to boost the S&P over 980. The mother of all tells: when the market doesn't react well to good news (and vice versa)

"This is the third day the important 980 level is being respected.

"Why is 980 pivotal?

"See this square of 9 chart.


Click to enlarge

"980/981 price is opposite March 6th time low. Many times at important lows and important highs price 'vibrates' off the time or time vibrates off price.

"As to 'bearish' sentiment indicative of higher prices, I prefer to look at what people do with their money as opposed to what they say, ie PRICE, the final arbiter."

Tomorrow will be pivotal after today's close at the day's high. Traders will be watching for economic data in the morning: Consumer Confidence (48.7 consensus estimates) and the S&P Case-Shiller Index (17.80% decline, say consensus estimates). Both are due out at 9:00 a.m.

Earnings will also be a big focus, but fewer market-moving companies will be reporting this week.

Before the bell: Coach (COH), National Oilwell Varco (NOV), United States Steel (X), Under Armour (UA), and Valero (VLO).

After the bell: Electronic Arts (ERTS), Panera Bread (PNRA), and Peets Coffee (PEET).

Have a great night!
No positions in stocks mentioned.

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