The Market. Here s the chart of the S&P 500. That blue line is The arrow shows Dec. 31, when the index closed at 1115.

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1 Page 1 Page 4 Page 7 Page 8 Page 9 The Market: Upside Bias Persists New Ideas: OIH, POT, LMT Updates: T, ABT Today s Indicator Reader Feedback & Questions: ONNN, SLB, INTC The Market (Note: I am taking a few days off, so there will be no newsletter tomorrow evening, Thursday, July 29. The regular schedule will resume Monday morning.) It seems to me that we don t need to discuss the indicators. We don t need to know about the put/call ratio. We don t even have to pay attention to the advance-decline line. All we need to watch is 1115 on the S&P 500. How many times are is the market going to toy with this area? Here s the chart of the S&P 500. That blue line is The arrow shows Dec. 31, when the index closed at (Continued on the next page) PLEASE SEE IMPORTANT LEGAL DISCLAIMER ON LAST PAGE

2 I have been asked several times for an upside target in the market. I can conjure something up. Heck, the head-and-shoulders bottom measures to 1160 or 1190 depending on how you calculate the breakout. But, in my mind, all of that is irrelevant if the market cannot get through 1115 and stay there. There is a window open at the present. It has to do with the 30-day moving average of the advance-decline line. Beginning tomorrow, and for approximately the next two weeks, we are dropping all red numbers on this indicator. There are two days where we are dropping a positive number -- think back, 30 trading days ago was that late June decline, so that s what is dropping. Here is the table so you can see what I m staring at. This shows you what we re dropping and, therefore, why the market is not yet intermediate-term overbought. (Continued on the next page) Thursday (588) Friday, July 30 (23) Tuesday 349 Wednesday (532) Thursday (1822) Friday, Aug 6 (227) Monday (1637) Tuesday 1433 Wednesday (200) Thursday (2550) Friday, Aug 13 (798) Monday (641) Tuesday (601) Wednesday (41) 2

3 Here is the chart to go along with it: Now, just because the market is not yet maximum overbought, it only means the window is open. What if it spends this time toying with 1115? Then it has used up the time factor by churning and not taking advantage of the opportunity while it was there. As for the put/call ratio and the International Securities Exchange (ISE), I expect there will be many questions since the ISE numbers were so high today. If you go to their web site you will see a box in the upper right corner that shows a massive amount of Microsoft (MSFT) calls purchased today. I am not a fan of rationalizing an indicator, not in the least. However, since these calls did not trade on the Chicago Board Options Exchange (CBOE), the readings on the CBOE show that the equity put/call ratio was 71%. There has not been a reading in the 70s since July 15. Volume was light today which I would put in the positive category. It might have been the market s first light volume down day in quite some time. On the negative side, breadth wasn t pretty and new highs shrunk. I think there is still have an upside bias in the market, but I also think unless it can breach 1115, and stay above it during this open window, then the chances go up that once the window closes in early August, that we ll go down again. (For a look at the latest RealMoney column, click here.) 3

4 New Ideas Once again, I want to note that you need to watch Oil Services HOLDRs (OIH) and the agricultural stocks. Oil Services HOLDRs, an ETF, was one of the first charts to bottom and rally. But it has spent the last week and a half going sideways. In that same time, the S&P has added about 35 points so the ETF has lagged. If it starts to roll over, I think it will become likely that the market will eventually follow suit. If the ETF is only taking a breather and launches another move up, then the market should follow suit. Shares closed Wednesday at $ (Continued on the next page) 4

5 Tomorrow, Potash (POT) reports its earnings so the agricultural stocks will get another try. They, too, have stalled and have gone nowhere since the market really took off a week or so ago. I ve noted that Mosaic (MOS) needs to get through $47 and Potash needs to clear $100 handily. Shares of Potash closed Wednesday at $97.71 and Mosaic ended at $ (Continued on the next page) 5

6 This is the same thinking behind the Oil Services HOLDRs discussion because if all the market is going to get is a giant oversold rally up to resistance, and then group rotation, then it is essentially using up the window instead of making actual headway. I ve got my eye on Lockheed Martin (LMT) for a potential teensy weensy head-and-shoulders bottom. A stop under $74 seems reasonable with a potential target in the $77 to $78 area. Shares closed Wednesday at $

7 Updates (Based on reader feedback, I m going to try and keep a list of all the stocks mentioned in New Ideas, accompanied with stops and targets. As always, feel free to me with any questions.) Stocks Long / Short Stop Target Latest Closing Price Notes AT&T (T) Long $25 * * * $26.20 There is a ton of resistance up here. I do not expect it will get through. Abbott Labs (ABT) Long $47.50 * * * $49.22 There is some resistance here so it should back off. Stop raised. 7

8 Today s Indicator The Volume Indicator did get over 50% and has backed off but since it is based on a 30-day moving average, it has a window open to move higher again. * * * (For an explanation of the methodology I use for TheStreet.com Top Stocks newsletter, please click here.) 8

9 Reader Feedback and Questions TheStreet.com Top Stocks is intended to provide technical analysis and opinions about stocks and markets. Helene welcomes your questions about TheStreet.com Top Stocks and her charting strategy and techniques. Please send an directly to Helene with your questions. However, please remember that TheStreet.com Top Stocks is not intended to provide personalized investment advice. DO NOT HELENE SEEKING PERSONALIZED INVESTMENT ADVICE, WHICH SHE CANNOT PROVIDE. I am starting to see so many stocks like ON Semiconductor (ONNN). They have had nice runs up to resistance, are now stalled and potentially heading back down. In the case of ON Semiconductor, I see a missing right shoulder of a potential head-and-shoulders bottom. So I might be interested in the stock for you if it pulled back to the $6.50 to $ 6.75 area, but up here it seems to be in no man s land. Shares closed Wednesday at $7.05. (Continued on the next page) 9

10 Schlumberger (SLB) is very similar to the Oil Services HOLDRs (OIH) chart. All that resistance overhead looms large. If Schlumberger can take out the $62 area and maintain it, I would be more than happy to believe that it s going to be a great stock going forward. Right now, however, I think it can get to $62 and I m just not sure it can get through it. Shares of Schlumberger closed Wednesday at $59.73 and Oil Services HOLDRs ended at $ (Continued on the next page) 10

11 Here s the question was posed to me: Is Intel (INTC) making a flag before it goes higher? I suppose it s possible but once again it seems to me to be missing the swing down toward the $20 to $20.50 area that could make a better bottom. Keep in mind how many times in the last year Intel has gapped up on its earnings then failed to follow through -- a lot. In fact, I think the only time it didn t do so was July of last year. So, I d lean toward a move down to that trend line to make a more interesting bottom on Intel. Shares closed Wednesday at $

12 Contact Info Customer Service: Please or call TSCM (8726) Mon. Fri. 8 a.m. to 6 p.m. ET; or outside the U.S. and in Canada, call Reader Feedback and Questions: Please send an directly to Helene. Again, please direct all account-related inquiries to customer service. Legal Information This information is confidential and is intended only for the authorized Subscriber. Please notify us if you have received this document in error by telephoning TSCM (8726). Helene Meisler writes a technical analysis column on the U.S. equity markets for TheStreet.com s RealMoney. TheStreet.com is a publisher and has registered as an investment adviser with the U.S. Securities and Exchange Commission. TheStreet.com Top Stocks contains Ms. Meisler s own opinions, and none of the information contained therein constitutes a recommendation by Ms. Meisler or TheStreet.com that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. To the extent any of the information contained herein may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. Ms. Meisler s past results are not necessarily indicative of future performance. At the time of publication, Ms. Meisler will not have a position in any security that she discusses in TheStreet.com Top Stocks. Furthermore, Ms. Meisler may not enter orders to purchase or sell securities mentioned in TheStreet.com Top Stocks until 24 hours after publication of the issue of TheStreet.com Top Stocks on which the security is mentioned. In addition certain of TheStreet.com s affiliates and employees may, from time to time, have long and short positions in, or buy or sell the securities, or derivatives thereof, of companies mentioned in TheStreet.com Top Stocks and may take positions inconsistent with the views expressed. TheStreet.com does not accept responsibility and will not be held liable for delays or failures in delivery caused by your Internet Service Provider or the Internet generally. TheStreet.com assumes no responsibility for the deletion, failure to store, misdelivery, or untimely delivery of any information or material. Under no circumstances shall TheStreet.com be held liable for any delay or failure in performance resulting directly or indirectly from acts of nature, forces, or causes beyond its reasonable control, including, without limitation, Internet failures, computer equipment failures, telecommunication equipment failures, other equipment failures, electrical power failures, strikes, labor disputes, riots, insurrections, civil disturbances, shortages or labor or materials, fires, floods, storms, explosions, acts of God, war, governmental actions, orders of domestic or foreign courts or tribunals, or non-performance of third parties. 12