This week the markets will be closed on Friday, July 3, as Americans celebrate Independence Day. Volatility is to be expected, due to the shortened trading week and to the fact that Tuesday, June 30, is the end of the second quarter, when fund managers can be expected to rebalance their portfolios.

Among the reports investors will be watching this week are Tuesday's S&P/Case-Shiller reading on April home prices, the Chicago Purchasing Managers Index of June business activity in the U.S. Midwest, and the Conference Board's June consumer confidence report.

On Wednesday, interest will focus on the ADP national employment survey for June, the Institute for Supply Management's June reading on manufacturing, May pending home sales, May construction spending, and June domestic car and truck sales.

On Thursday, the report on May factory orders will be issued. Of primary interest, however, will be the monthly non-farm payrolls data, which is expected to show a loss of 355,000 jobs in June and an increase in the U.S. unemployment rate to 9.6 percent. Investors will focus on this report with an eye to validating whether or not the recent market rally can be supported.

The second-quarter earnings season is just ahead, and investors will be watching for companies' outlooks or pre-announcements. Aluminum producer Alcoa Inc. (AA) will open the earnings season with its report on July 7.

9 Stocks to Watch

Three stocks are setting up pullbacks. Microsoft (MSFT) has pulled back and held support at the .236 Fibonacci line. Both Tyco Electronics (TEL) and Dr Pepper Snapple Group, Inc. (DPS) are forming pullbacks on the weekly charts.

Four stocks are ready for breakouts. Intel (INTL), Eastman Kodak (EK), and Prologis (PLD) have formed tight multi-month channels. Pepsico (PEP) has formed a wider upward sloping channel.

McCormick & Co. (MKC) is bouncing off a trendline, but has daily resistance at 33.44. A wedge formation and multiple Fibonacci retracements are pointing to a bounce off the 30.60 level in Darden Restaurants (DRI).

Dave Mecklenburg is the Editor-in-Chief of TigerSharkTrading.com.