document: The Week Ahead : Buy Stocks , Not The Market The relentless nature of the rally from the March 16 lows has many market veterans scratching their heads . The market is clearly overdue for the setback I was looking for last week . Attempts by fund managers to goose their quarterly numbers likely played a role in the rally into the end of the month , while the very good jobs numbers boosted stocks even higher on Friday . One of the more surprising developments last week was the surge in small-cap stocks , as the Russell 2000 moved above the February highs on Thursday . This is very positive if the S&P 500 and Nasdaq Composite can also surpass their February peaks , as the Dow Industrials did on Friday . The chart of the iShares Russell 2000 -LRB- IWM -RRB- shows the completion of the trading range -LRB- lines a and b -RRB- with upside targets at $ 85.50 and then $ 87 : Click to Enlarge The week ahead will be a quiet one in terms of economic reports , with the ISM Non-Manufacturing Index on Tuesday that gives us a reading on the health of the economy , followed by jobless claims Thursday . The EIA 's latest petroleum-inventory report will be released Wednesday , but more important for crude oil will be any new developments in Libya . If Gaddafi were to step down it would dampen the rally in crude oil prices . WHAT TO WATCH S&P 500 The monthly chart of the Spyder Trust -LRB- SPY -RRB- shows that the next major resistance stands at $ 141 to $ 145 . The lower monthly close for SPY has caused its momentum , which had been rising since the end of September , to flatten out . Therefore a higher close in April is needed to keep the momentum from turning lower , as it did in May 2010 . The NYSE advance/decline line has surpassed its February highs , which is positive for stocks in general . There is initial support for SPY at $ 131.50 and then at $ 130.40 . The $ 128.30 level should hold on a deeper pullback . Dow Industrials The Diamonds Trust -LRB- DIA -RRB- surpassed the February highs Friday at $ 123.64 , and has next resistance at $ 124.80 and then $ 128.50 to $ 129 . Strong action last week leaves first support at $ 122.50 to $ 121.60 , with much stronger levels in the $ 120.50 area . Sector Focus It was a tough quarter for stock pickers unless you were in the energy sector . As I noted in Friday 's article , only the Energy Select Spyder -LRB- XLE -RRB- and the Industrial Select Spyder -LRB- XLI -RRB- were able to outperform the S&P 500 in the first quarter . This is quite unusual , as more often there are three or four sectors that outperform the S&P 500 . Typically stocks are not as strong in the second quarter , leading to the well-worn phrase `` sell in May and go away . '' More Sector Focus
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