The Dow, Nasdaq, and S&P 500 all have a sidelines rating. The Russell 2000 has a weak uptrend rating; therefore, my rating is a sidelines rating. Neither the Bulls nor the Bears have a dominant position over the other. That’s a very dangerous market folks that can break either way.

My trader buddy Mike got wiped out in this trend-less market. I lost thousands on my TVIX play. Short sellers have gotten killed. Long have gotten killed. The bodies pile up on the trading battlefield. Don’t be one of them. Stay back in the brush and the safety of cash. When a dominant group emerges, jump out of the bushes and fight on the side of that dominant group. For now though, let other suckers die for their cause.

The Elder system applied to SPY shows on the daily a blue bar for indecision. On the weekly SPY chart, it shows a green bar which is a buy signal. We don’t take action when the Elder system gives mixed signals. We only take action when both the daily and weekly signals agree. The mixed signals coming from the Elder system support the sidelines rating in the market.

Gold and gold mining stocks all have sidelines ratings. They’ve gone no where for the last couple of months.

The U.S. dollar has a strong uptrend rating and had a huge white candle on Friday. This will continue to put a downward pressure on gold.

The percent of stocks trading above their 50 day moving average on the NYSE is 65%. The percent of stocks trading above their 200 day moving average is 58%. Both these indicators show a bullish bias.

A surprisingly bullish bias is coming from VXX (VIX Short-Term Futures) and VXZ (VIX Mid-Term Futures). Both are in down trends which is bullish for the market. Keep in mind that the VIX has been one of our most accurate predictive indicators because it is the measure of put buying/hedging.

Fundamental analysis reports that moved markets last week were: Monday’s ISM Mfg Index, and Friday’s Employment Situation reports.

The ISM Mfg Index report shows contraction in June for the first time since July 2009. New orders, at 47.8, show contraction for the first time since April 2009 and the degree of the decline is the steepest since October 2001. Export orders, reflecting weakness in Europe and China, are a serious negative, at 47.5 for the first contraction since June 2009 and the lowest reading since April 2009. With a lack of new orders, manufacturers are working down backlogs which are at 44.5.

The Employment Situation report shows job creation was sluggish in June but there are some positive signs for manufacturing and personal income. The unemployment rate remains elevated and unchanged at 8.2 percent in June. Payroll jobs in June advanced a modest 80,000, following gains of 77,000 in May (originally 69,000) and 68,000 in April (previous estimate of 77,000). The net revisions for April and May were down 1,000. The market consensus was for 90,000.

Fundamental analysis reports with the greatest probability of moving markets next week are:
Wed – Jul 11, 2012 = International Trade
Fri – Jul 13, 2012 = Producer Price Index