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Comedian and actor Billy Crystal's parody of Fernando Lamas was mimicked by institutions in today's trade, if only to a small round of applause, as some end of quarter window dressing had the major equity indices closing near their highs of the session as volume picked up to the close.

If institutions were dressing up their bullish holdings, most would say the indices gains looked like that of a mannequin at a discount apparel retailer, and not necessarily one at Tiffany's.

While an upwardly revised final second quarter GDP to 3.3% from the previously reported 2.8% didn't hurt bullish psychology in today's session, stock gains were somewhat limited as it was inventory building and a downward revision to exports that comprised the bulk of the upward revision.

If bulls were going to dress up some of their equity holdings that had slipped from second-quarter levels, they may have sold some of their "safe haven" Treasuries, using the second quarter GDP as an excuse. The yield curve flatted, also a likely trade for limiting equity gains, with the shorter-dated 5-year yield ($FVX.X) backing up 8.3 basis points, while the longest-dated 30- year yield ($TYX.X) rose 6.0 basis points to 4.861%. The belly of the curve had the benchmark 10-year yield ($TNX.X) finishing up 7.8 basis points after a touch of its WEEKLY R1 in our pivot matrix.

Nothing too significant from the benchmark 10-year yield. Today's high was nearly a match of last week's YIELD high of 4.106%.

I've also set various alerts at the different Fed Funds futures contracts, and didn't get a single alert to a 10% change in market thinking on any of the contracts. November Fed Funds futures (ff04x) were unchanged at 98.105 and currently predict a 60% chance that the Fed will raise rates an additional 25 basis points to 2.0% at its November 10 meeting.

A surprising build in crude oil inventories had oil easing back from its recent highs, and that brought some selling into energy- related equities with the Oil Service Index (OSX.X) 120.09 -1.50% and CBOE Oil Index (391.68) -1.10% seeing some profit taking.

Homebuilders as depicted by the Dow Jones Home Construction Index (DJUSHB) 655.73 -1.0% were also weak.

Hey... when the mannequin is already dressed up at the end of the quarter, focus attention in other places so you don't look so silly to your shareholders.

Market Snapshot / Internals - 09/29/04 Close

Was there some window dressing by bulls in today's session? That's arguable for sure. However, in the 03:15 PM EDT I noted volume was rather light. In what I would consider to be window dressing fashion, volume picked up to the close, a/d lines reached their best levels of the session, and the Dow Industrials (INDU), which are filled with just 30 of those big liquid stocks, found a decent little 41-point gain in the final hour of trade.

Caterpillar (NYSE:CAT) $80.50 +4.68%, which moves up to the third-highest priced component of the price-weighted Dow Industrials plowed further above its 200-day SMA today. Number 1 and 2 price-weighted components had United Tech (NYSE:UTX) $92.75 +0.43% and IBM (NYSE:IBM) $84.98 +0.59% edging higher.

After the close, IBM (IBM) last ticked at $85.10 over the New York ECN after saying it would take a $320 million charge against earnings in its current quarter following the partial settlement of a class action lawsuit relating to its pension plan. The deal reportedly caps IBM's further potential liability at $1.4bn, removing a significant uncertainty over the financial outlook for the company.

Smaller price-weighted Dow components had Hewlett Packard (NYSE:HPQ) $18.52 +1.53% and Intel (NASDAQ:INTC) $20.08 +2.03% participating in a bullish tech trade.

At the mid-point of today's trade, Dow breadth was even at 15 to 15. While not conclusive that the last hour of trade was all window dressing, breadth was positive at 23 to 7.

Boeing (NYSE:BA) $51.01 -2.5% was the lone percentage loser after Banc of America Securities' analyst Nick Fothergill downgraded the stock to "neutral" from "buy," and cut his price target to $53 from $60. Thomas McManus chimed in and reminded investors that BA has returned more than 25% since the beginning of 2004 (including dividends) and was concerned about the stock's valuation.

U.S. Market Watch - 09/29/04

What in the heck is the Disk Drive Index (DDX.X) doing? Up 10.85% the past four weeks?

SanDisk (NASDAQ:SNDK) $28.99 +3.57% has been acting well since it reported upbeat earnings last quarter and backfilled that gap higher at $24.00. For months, during the stocks torrid decline the company's CEO said Wall Street was missing the company's bullish fundamental and product synergies.

Disk Drive Index (DDX.X) - Daily Intervals

I was surprised to see the DDX.X as the top percentage gainer over the past four weeks (20-sessions). I slapped a conventional retracement on the DDX.X, which does trade with options. Long- time OI subscribers know this is an "make it or break it" type of sector. When the disk drives catch fire, the burn higher quickly. When the momentum dries up, the decline is as sudden as a computer disk drive crash.

DDX.X stock components - Sorted by price

Here's a quick look at the components of the DDX.X and what THEY did today (Net%), the last 20-days (20-day Net%) and last 52-weeks (YrNet%). Stock traders will use index analysis to start sniffing out some stock trades.

When I was hunting for an end of quarter dress up trade I looked at IBM. While not a component of the DDX.X, IBM has a huge storage business unit. Certainly the above stocks are more "desktop" related, but the DDX.X potential head/shoulder bottom pattern caught my eye with what I also see developing in IBM.

IBM (NYSE:IBM) - Daily Intervals

A potential head/shoulder pattern may be developing in IBM too. While I was looking at the stocks as an and of quarter window dressing bullish candidate, its pattern along with tonight's DDX.X observation struck me as being somewhat tied together.

That downward trend on IBM is somewhat notable too, as after being broken, served up a little support last week as the potential right shoulder forms.

IBM is the 10th-largest market cap stock in the S&P 100 Index (OEX.X).

S&P 100 Index (OEX.X) - Daily Intervals

There are quite a few "reverse head/shoulder" patterns in the market right now and NOT EVERYONE is a PROFITABLE ONE that pans out if traded at the bottom of the RIGHT shoulder (goes for tops and bottoms). See the PINK "V" I marked back in March? That was a potential left shoulder, where head was at the BLUE "V" I marked at (1). I don't like it when the right shoulder, or the BLUE "V" marked (2) grows into the ear of the head.

And while it is VERY difficult to get 100 stocks to all trade enough in unison to get a nice head/shoulder pattern, it is notable that the OEX appears to be building something similar to what we see in IBM and the DDX.X.

It's the old downward trend (thick red) that we keep on our OEX chart that now serves what I call "bearish support" after being broken to the upside in late August. Certainly the rather conventional use of retracement at the 19.1% level of 529.85 could explain Tuesday's low. So could institutional buying from the OEX's WEEKLY S1.

Pivot Matrix -

Not a lot of support correlations, other than BIX.X MONTHLY Pivot and DAILY Pivot, which would be tentative as it was traded through today. OEX.X DAILY S1 and MONTHLY Pivot also a support correlation.

I do see some OEX 540-ish at DAILY R2 and WEEKLY Pivot, but to get there, TRIN had better stay below 1.11 and gravitate towards 0.62. VIX.X plunged back below 14 and there was a lot of action at the SPX.X Dec. 1,115 strike for both puts and calls in today's session.

Jeff Bailey

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