The Euro slid to a fresh one-year low after Spain's debt rating was downgraded. This has been a tough week for the EU, Greece, Spain and Portugal all saw their debt ratings cut as the fear of default swells. Analysts are concerned that other European nations, (i.e. Ireland and Italy), may be next to see their ratings cut as the continent continues to make its way through the worst financial crisis since WWII!

Around 2pm EST, the Federal Reserve held rates steady and reiterated their stance to keep their benchmark interest rate near zero for an “extended period” as the economy continues to improve. The Fed said, “Economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period.” Futures trading currently show that there is a 15% chance that the Fed will raise rates by their August meeting. In March, the odds were closer to 50%. 

PICTURED: The weekly chart of the S&P 500 Index illustrates how the benchmark index closed below the 1,200 threshold after recently rallying above it with great volume conviction.

The Retail Index ($RLX -0.57%) and Internet Index ($IIX -0.14%) ended Wednesday's session with small losses while most groups posted gains.  The Bank Index ($BKX +1.36%) and Broker/Dealer Index ($XBD +1.12%) were among the important positive market influences. Tech shares also rose as the Networking Index ($NWX +0.34%), Semiconductor Index ($SOX +0.48%), and Biotechnology Index ($BTK +1.20%) unanimously posted modest gains.  Energy shares also rose as the Integrated Oil Index ($XOI +0.88%), and Oil Services Index ($OSX +1.13%) spurted higher.

The Healthcare Index ($HMO +2.35%) was among the session's best gainers. Yesterday's IGW section (read here) pointed out the substantial YTD gains that have come from influential industry groups like the Retailers and Banks. The defensive "safe haven" groups have clearly not kept pace this year, as shown by the relatively sluggish gains from the Healthcare Index (HMO +3.4% TYD) and Gold & Silver Index (XAU +4.9% YTD) thus far into 2010.

Charts courtesy www.stockcharts.com

PICTURED: The Gold & Silver Index ($XAU +2.74%) traded above its April high intra-day. In the days ahead this is action worth watching.  However, few mining firms have solid quarterly and annual earnings histories, or they would be showing up in the daily screenings and reports.

Priceline.com Inc. (PCLN -$2.52 or -0.95% to $261.78) is consolidating on lighter volume. It recently rallied for a considerable gain and new 52-week high with just above average volume following a brief consolidation above its 50-day moving average (DMA) line. It did not spend enough time consolidating to form a sound base pattern, aside from it being only a half-hearted push into new high ground. Still, this high-ranked Leisure-Services firm is has no overhead supply to act as resistance, so it can easily rise unhindered for more climactic gains. Its relatively small supply of only 45.6 million shares (S criteria) can lead to great price volatility in the event of institutional accumulation or distribution. Volume and volatility is often greater near earnings news, and the company is due to report its latest quarterly earnings on May 10th.

Disciplined investors avoid chasing stocks extended from a sound base. PCLN previously appeared in this FSU section on 2/18/10 under the headline "Big Gap Up Gain On 4 Times Average Volume" when triggering a technical buy signal while rising from a 9-week base. It was still color coded yellow on 3/10/10 when it made a subsequent FSU section appearance under the headline "Priceline Remains Perched Near All-Time Highs Following Latest Breakout", but its color code was changed to green after blasting above its "max buy" level.

A summary of past coverage and the stock's subsequent action was published on 11/07/08 under the headline "Multiple Sell Signals Preceded Big Price Decline."  That write-up explained the stock's weak action after it had been dropped from the Featured Stocks list after its 200 DMA violation on July 2, 2008. Keep in mind that PCLN was first featured on Friday, November 09, 2007 in the CANSLIM.net Mid Day Breakouts Report after gapping up over the $100 threshold (read here).

Color Codes Explained :
Y - Better candidates highlighted by our staff of experts.
G - Previously featured in past reports as yellow but may no longer be buyable under the guidelines.