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Stocks stuck into the close

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Stocks appear stuck at their best levels of the session as we approach the closing bell. In the past hour alone, the more volatile NASDAQ-100 Trust (AMEX:QQQ) has been tightly bound from $30.56 to $30.74, just off its session high of $30.82. A close above the $31.00 today for the QQQ could have bears in this part of the market a little edgy tomorrow morning and create a gap higher situation.

In today's 01:00 EST Update, I mistakenly wrote that Applied Materials (NASDAQ:AMAT) $25.53 +7.8% reports earnings tonight. That was incorrect! Applied Materials reports earnings tomorrow, after the closing bell.

We continue to see some near-term rotation away from healthcare as the HMO Index (HMO.X) 595.17 -2.33% and the Morgan Stanley Healthcare Providers Index (RXH.X) 347 -1.37% see some selling after recent quarter's gains. We're looking for the HMO.X to firm up near the 550 level for some bullish action points in the HMO stocks.

Today's action in the Dow Industrials is seeing some rather stellar gains in shares of Intel (NASDAQ:INTC) $28.42 +5.18%, American Express (NASDAQ:AXP) $43.24 +4.19%, Microsoft (NASDAQ:MSFT) $4.77% and SBC Communications (NYSE:SBC) $31.89 +4.76%. Eastman Kodak (NYSE:EK) $33.28 -2.97% continues to show session weakness, but has battled back well of its earlier session lows of $32.70 after finding support at its rising 50-day MA. Just recently, EK was able to battle back above it 200-day MA for the first time since mid-September of last year.

Earlier today, crude oil futures had traded lower, but by session's end, the June 2002 futures contract (cl02m) had recouped losses to finish at a new high of $28.38. Tomorrow's action is already under way with further gains being made in the contract at $28.42.

Energy stocks have responded to today's comeback in oil prices as the CBOE Oil Index (OIX.X) 328 +1.99% and Oil Service Index (OSX.X) 110.36 +1.93% are at their best levels of the session.

CBOE Oil Index Chart - Daily Interval

Today's mid-session turn higher in crude oil futures should find some bulls in the OIX.X. The index chart looks to be breaking out from recent pullback consolidation. Shares of sector bellwether and Dow Component Exxon/Mobil (NYSE:XOM) $39.97 +2.59% are helping drive gains. XOM faces resistance at its trending lower 200-day MA at $40.25, but a break above that level could have the stock trading higher to its curling lower 50-day MA near $42.

Jeff Bailey
Senior Market Technician
Option Investor

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