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The markets saw monster earnings results from companies like International Business Machines Corp. (NYSE:IBM) and Google Inc(NASDAQ:GOOG). In addition, mid size companies Cree, Inc. (NASDAQ:CREE) and Intuitive Surgical, Inc. (NASDAQ:ISRG) are both soaring on their quarterly results. Overall, fourth quarter earnings have been solid. While the markets have been moving higher of late, today the they remain flat. This should be worrisome to investors after such solid reports. Reasons To Be Cautious 1. The markets have made new 52 week highs in recent days, thus are extremely extended. 2. The unemployment rate remains north of 7.5% and the economy still can barely add jobs. 3. Great earnings should be shooting this market dramatically higher, yet no upside is seen. 4. Markets have rallied on extremely light volume. This light volume is attributed to the small investor, coming into the market again. The retail investor always buys the market tops. 5. Apple Inc. (NASDAQ:AAPL) reports today. This one report could sway the markets dramatically. The key to the next move is always shown in the charts. The question is, will you see it ahead of time? The markets are starting to show weakness while the retail investor piles in. Learn to read the markets better than any institutions. Discover the PPT Strategies, proprietary techniques with an 80-90% success rate. Take the seven day free trial to the Research Center today. Gareth Soloway Chief Market Strategist www.InTheMoneyStocks.com

Almost every day the markets are inching higher after early morning selling. The last five trading days have either seen a gap lower or an early morning sell before the markets float back to the flat to positive side. So what does this mean? Why is this happening?

First, understand that the volume is key. The volume in this market has been insanely light for any month, especially January. Early morning dips are the result of increased volume from institutions on the sell side. After the first hour, the volume is too light for them to sell without hurting the market significantly. Therefore, they stop. The remainder of the day is retail investor buying. Last week saw the largest inflows of retail money into mutual funds since 2002.

The fact that institutions are selling and retail investors are buying should be a warning sign. Average investors always buy the tops on the market and institutions rarely get caught still in full positions at those same tops.

So where is the market heading in the near term? Over the next couple weeks this early sell, followed by a float higher should continue. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is only $1.00 away from its 52 week high of $148.11. Additionally, it is likely that 52 week high will be taken out with the SPY heading to $150.00. Once this level is achieved, most of the poor average investors would have bought in. Early February should bring rocky action and a decent decline into the markets. From $150.00, the SPY may fall to $142.00 if not lower.

Name brand large caps like Goldman Sachs Group, Inc. (NYSE:GS) and Chevron Corporation (NYSE:CVX) should remain strong until early February as well.

The key to the future weakness is multi faceted. First, the technical charts are showing clear signals. Secondly, it coincides with the spending cuts and debt ceiling issues facing the United States. These stand as giants above the Fiscal Cliff resolution reached at the start of the year and have the potential to see the U.S. default as well as spin back into recession.

Be warned, good times should remain for the next few weeks. However, storm clouds lurk. For those of us who swing trade the market, amazing opportunities are everywhere. Learn the proprietary PPT Strategies and profit for life. Take the seven day free trial to the Research Center and begin your new life today.

Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com