Stocks were under pressure for most of the session after disconcerting economic data hit the wires from across the globe. In Asia, Japan's government said that the world's second largest economy grew at a +1.3% annualized rate last quarter which was way below the +4.8% reported last month. The sharp downward revision caught nearly everyone off guard and sparked concern that a double dip recession is likely. In Europe, Standard & Poor's lowered Spain's credit outlook to "negative" and said they were concerned with the country's slow economy and massive deficit spending. This occurred one day after a separate rating agency downgraded Greece's credit rating. Stocks in Greece plunged -12% this week as investors scramble to move into "safer" assets. 

Perceived Safety: The US dollar has rallied for most of the week which has put pressure on dollar denominated assets- mainly stocks and commodities. Crude oil plunged, as the dollar edged higher, and hit a fresh two-month low of $73.05 a barrel in New York. The government released a bearish report which showed that US fuel inventories rose as refineries increased operating rates. The report also showed that gasoline stockpiles rose to 2.25 million barrels. Elsewhere, gold continued its week long decline but it was encouraging to see gold equities rally on Wednesday. Gold bulls were happy to see this subtle, yet important, divergence.

Bailout Extended: The bulls cheered after the Obama administration announced that it would extended the $700 billion financial bailout program until October 2010 to help stimulate the economy. This helped offset concerns that that government would prematurely withdraw its support and that would adversely affect the global economy. In addition, many people were concerned that if that were to occur than that could be a major catalyst in the possibility of a double dip recession. At this point, government's across the world are reaffirming their stance and supporting their stimulus packages.

Price and Volume: Around 2PM EST the greenback started to fall and US stocks started to rally. Apple Inc. (AAPL +4.18%) vaulted +$7.66 and closed above its 50-day moving average (DMA) line on above average volume. Apple has been a strong leader since the March lows and the fact that it quickly repaired the recent damage is a bullish sign for this rally. A new crop of high-ranked stocks are currently working on new bases as the major averages continue consolidating their recent move above their respective 50 DMA lines. The bulls deserve the bullish benefit of the doubt until the major averages close below their respective 50 DMA lines.

PICTURED: The S&P 500 Index bounced off support again.

Charts courtesy www.stockcharts.com

PICTURED: The  Gold & Silver Index ($XAU +2.64%) rallied back above its 50-day moving average line, halting a steep 4-day slide.

Baidu.com, Inc. (BIDU +$7.62 or +1.82% to $426.46) overcame early weakness today, posting a gain and closing at the session high while breaking a 5 session losing streak. The number of top-rated funds owning BIDU's shares rose from 103 in Dec '08 to 169 in Sep '09, clear evidence its shares were being accumulated by the institutional (I criteria) crowd.  Technically, it has built a sloppy base over nearly 7 weeks while consolidating in a tight trading range near all-time highs as its 50-day moving average (DMA) line has caught up. Since quietly rallying to new highs in November, this Chinese provider of Internet search and content services has stalled. Its color code is changed to yellow again with new pivot point cited based upon its 10/26/09 high plus 10 cents.  Gains above its pivot point, or to new high ground, with at least +50% above average volume would be considered a new bullish technical buy signal. Meanwhile, any deterioration below its 50 DMA line would raise concerns and hurt its outlook, while it could continue base-building for a longer period.  Patience is important because without convincing gains leading to a fresh breakout there is little assurance it can sustain a meaningful rally higher.  Even a powerful breakout might be risky to trade after its 4-fold ascent this year, its recent action could be "late-stage" and more failure prone. 

BIDU proved resilient near its 50 DMA line after its 10/27/09 gap down, and it was a sign of great institutional support, making a stand near its important short-term average line.  Technically it traded a little bit above the prior chart high of $439.90 following the considerable gap down on earnings news, as it clawed its way to new all-time highs on lighter than average volume, leaving questions as to how much appetite the large investors had for accumulating a greater ownership interest in the high-ranked. The last appearance in this FSU section on 11/25/09 included an annotated graph illustrating its "wedging" action under the headline "Wedging To New Highs With Light Volume Behind Gains."

BIDU traded up as much as +23% from its price when featured in yellow in the 9/08/09 Mid-Day BreakOuts Report (read here). In this FSU section on 9/21/09 we summarized more extensive prior coverage this currently Featured Stock has received (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.