6:30pm (EST)    

You have to hand it to the bulls…

There was a lot of nervousness in the market last week and Monday was a key day for the bulls.  The Dow had closed above the 11,000 level on the previous Friday but the bears were doing some damage and had taken the Dow below that level after the hearing the Securities and Exchange Commission (SEC) was charging Goldman Sachs (GS, $157.40, down $1.65) with fraud.

The Dow had dipped to a low of 10,947 and that level was broken last Monday morning when the index hit 10,940.   However, the bulls got a huge emotional lift after they found out late in the afternoon that the SEC’s vote to follow-through with charges of fraud against Goldman wasn’t unanimous and was only secured by a 3-to-2 vote. 

The bulls used that momentum and a bevy of solid earnings announcements to power the market to another weekly gain as all three indexes bounced back from that Friday’s debacle.

The market still faces plenty of headwinds with the Financial sector but anyone who has shorted this market is learning you don’t tug on Superman’s cape. 

On Friday, the Dow managed to extend its week-long gains with a 70 point burst, or 0.6%, and settled at 11,204.  The Dow managed its biggest weekly gain since the week ending March 5th by adding 185 points, or 1.68%, as the bulls left no doubt they are still interested in taking this market higher. 

The S&P 500 added 8 points, or 0.7%, and closed at 1,217.  The previous high was 1,213 which was taken out on Friday as the index added 25 points, or 2.1%, for the week. 

The Nasdaq continues to roll as it enjoyed an 11 point pop, or 0.4%, and closed the week at 2,530.  For the five days the index surged nearly 50 points, or 2%, as Tech continues to shine.

Two weeks ago we listed short-term targets of Dow 11,300-11,400; S&P 500 1,250-1,275 and Nasdaq 2,550-2,600 over the next few weeks.  We also mentioned that we felt the current rally could last through April and a little into to May.  So far, so good.

The bulls made up a lot of ground last week and rebounded nicely which brings those aforementioned targets back into play.  Remember, to the downside we have outlined support areas as Dow 10,800-10,500; S&P 1,150-1,100; and for the Nasdaq we have solid support at 2,400 and then 2,250.

We mentioned on Friday we had some exciting news to share and we will finally get the outcome for one of our all-time favorite stocks this week…Dendreon (DNDN, $40.10, up $0.78).

Here are some recent excerpts from our daily commentary and some from our Members Area that will get our new subscribers caught up. 

From February 22nd, 2010 (quotes from that day):

“We mentioned Dendreon (DNDN, $32.89, up $0.53) this morning after the stock was up in pre-market trading.  JPMorgan (JPM, $40.71, up $0.68) came out with an ”Overweight” rating and a $46 price target on our favorite Drug stock.  The call is based upon a belief that Provenge will be approved for advanced prostate cancer.

There are also higher “unofficial” price targets for Dendreon but the drug must get approval first before we say it’s headed past $50.  However, we think shares can hit $100 in the next two years if Provenge is approved but it will depend on how well the company handles the transition from “small town Billy” to “big town Bobby” as sales are expected to reach over $1 billion.” (END) 

From Feb 4th, 2010:

“The stock (Dendreon was just under $30) has traded in a tight range ($25-$30) since April of last year and each time it gets to these levels it tops out.  What is important now is that shares are approaching a “triple-top”.  Or so it seems.  This is usually a bearish indicator but we all know Dendreon should be getting the all clear sign from the FDA concerning its drug, Provenge. 

Traders usually wait for prices to make a definitive break below the confirmation point of a triple top and if prices do not fall below that point then it might not be a triple top.  Instead, it could be a bullish sign as shares retreat from the highs of those three tops and then continue on in an upward trend. 

The FDA should make its announcement around the first of May and maybe shares do head back down to $25-$26.  We have been teased before.  The 52-week high is $30.90.” (END)

As you can see, shares have jumped 25%-30% since February and the stock will likely make the water cooler rounds this week.  The talking heads will be covering this watershed event later in the week and we are going to try and take advantage of the hype.  We will probably pull the trigger on an option trade come Monday morning.

We have a lot of research to do tonight but we wanted to get the Weekly Wrap out a little early.  We will be back in the morning with the list of all the companies announcing earnings this week as well as an update for all of our current trades.  

We think the bulls could have another big week…