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  Leigh Stevens   5/31/02,  5:08:13 PM
Subscriber QUESTION: "Hi Leigh.You have been commenting on a Head and Shoulders bottom you see in the charts. I see a Head and Shoulders on the 60 Min chart as well....but its not a bottom pattern. I cant post the chart for you but I can give you days to check out on Naz 100: Left Shldr: May 8th; Head: May 15th; Rt. Shldr: May 23rd; Break: 28th; Retest: 28th and ????? maybe today!!

If my count is right. I see from the top of the pattern to the neckline equals 150 or so points. from the point of the break that takes us down to 1095. But I will go conservative and say 1150. The May lows!! Just musing here."

RESPONSE: You can have a short-term Head & Shoulders (H&S) top, within a larger bottom pattern. One I outlined, SPX H&S bottom, is broad one on weekly chart not so apparent on Nasdaq.

Chart or technical patterns are according to the time frame being looked at; e.g., hourly, daily, weekly, monthly. Of course what you can see on hourly basis, may be also apparent on daily chart, daily chart pattern often is repeated on weekly chart, etc.

I didn't notice before H&S top pattern on Hourly NDX chart, but do now. Wish I had seen it then - would have suggested QQQ short sooner. There is a "double shoulder" on the left, but that’s OK. Now that I measure it off, agree with possible 1150 downside objective on NDX, based on "minimum" objective implied by the (H&S top) pattern.

 
 
  Jeff Bailey   5/31/02,  4:30:56 PM
Stock to watch next week for trade may well be Honeywell (NYSE:HON) $39.20 +3.59%. Stock traded strong into the close. Watch a trade at $41 as spread-triple-top and break of downward trend. Gave nice move from bullish triangle at $35. Vertical count is bullish to $61. Link

Bar chart gives impression that stock has been eating away at supply from June-September's $35-$40 range, but not much above there to $45. With some tensions overseas, may be some old bulls deciding its just too soon to sell and some new bulls looking for exposure.

 
 
  Jonathan Levinson   5/31/02,  4:11:44 PM
What a day for the Nasdaq! A headfake to the downside in the morning, then to the upside, then a dump from the top to close at the low of the day. If anyone's nerves aren't frayed by now, they deserve a kewpie doll. Have a great weekend.

 
 
  Leigh Stevens   5/31/02,  4:00:11 PM
Subscriber NOTE: "Leigh, If you believe in candlestick reversal signals, yesterday's indices had enough to light up the room (I don't have my Steve Nisan bible with me, so may not get all the technical terms precisely): $BMX--bullish reversal; $BKX--Doji star; $BTK--"Doji Hammer"; $INDU--morning star with a BIG lower shadow, reaching to lower Bollinger Band; $NDX--a "near" bullish reversal; $SOX--a "perfect Doji Hammer"; $SPX--long handled hammer (reaching down to 1054)....I bought an $SPX July 1100 call yesterday, so I'm looking for that light at the end of the tunnel. Taken together these candlestick indicators put a glow on my face (maybe it will be a red one next week). What's your thought?

RESPONSE: I am familiar with Candlestick reversal patterns, especially common ones like the "hammer" - I also know Steve Nison fairly well, from mutual friends and cause we are both members of the New York based Market Technicians Association (MTA). Do not generally use Candlestick "signals", but am bullish on the indexes on a long-term basis; also somewhat bullish for shorter-term after indices, for the most part, made double bottoms yesterday (Thurs) especailly SPX at 1054.

 
 
  Jim Brown   5/31/02,  3:50:22 PM
Pivot Trade Exit Point Alert - OEX/SPX/DJX
Sell target for this afternoon is 528. With the OEX 2 points below our entry and the markets still trending down slightly, although more slowly, I am not going to close the SHORT today unless we hit 528. We will ride it over the weekend on the assumption that there is not enough bullish sentiment to gap it up much higher than our entry point on Monday. YOU, the individual investor, should only do this if it fits your risk profile. If it will cause you to worry over the weekend then close it now and go flat.

 
 
  Jim Brown   5/31/02,  3:33:23 PM
Pivot Trade Signals
That 530 support level that held the market up all day on Wednesday is providing support again as we near the close. The Nasdaq is showing signs of weakness and is struggling to hold the 1625 level. With the Dow failing to hold over 10000 and the S&P losing ground at 1080, 1075 and now 1070, you could wonder where the bulls went. Will Monday be a typically up first trading day in June or will the afternoon weakness today AFTER an entire slate of positive economic reports signal our direction. Enquiring minds like ours would like to know. The key will be the end of day rush. A positive move will likely telegraph a positive open on Monday. Stay tuned!

 
 
  Jeff Bailey   5/31/02,  3:32:52 PM
Amgen (AMGN) $47.75 -4.76% ... stock lower after just recently released comments from JP Morgan suggesting that Abbott's (NYSE:ABT) $47.40 +1.41% "D2E7" could be awarded fast-track approval next week. D2E7 is being developed for rheumatiod arthritis, and is a potential competitor to Immunex's (NASDAQ:IMNX) $25.14 -4.18% "Enbrel". IMNX is being acquired by AMGN.

 
 
  Jonathan Levinson   5/31/02,  2:58:57 PM
Nasdaq-100 volatility index (QQV) *just* flipped to green, up .19 at 38.31 as I type. In other words, the market has only now begun to feel fear. This tells me that there's room to run to the downside, as participants begin to look for the exit door.

 
 
  Jeff Bailey   5/31/02,  2:55:29 PM
Verizon (VZ) $43.41 -1.27% .... getting alert here, would short full position, market, stop $45.50, target new lows. (see 02:25:15 and 02:26:56)

 
 
  Jonathan Levinson   5/31/02,  2:54:32 PM
With open trades, don't forget to respect your time frame. With current month options where the goal is short term profits, tight stops are the rule- as Jim repeated like a mantra, don't be afraid to exit aggressively, which means tight stops. With back month contracts, there's more leeway, and you can afford to set wider stops. Manage your account, keep it growing, don't lose money. The golden rule.

 
 
  Jim Brown   5/31/02,  2:47:04 PM
Pivot Trade Entry Point Alert - OEX/SPX/DJX
We were triggered on the OEX/SPX/DJX short at 14:40:06 when the OEX traded below the entry point of 532.25. (SPX 1071.50) We are going to put a tight stop on it of 535 (SPX 1077 est) and watch as we near the last hour of trading. I did not really want to go into the weekend with an open position but as Leigh stated earlier, the surprises have been in the bears favor lately. If we get a significant drop this afternoon I would plan on locking in profits before the close so be prepared.

 
 
  Jonathan Levinson   5/31/02,  2:42:49 PM
Couldn't hurt to lower the stop on QQQ put play to our entry point and protect capital here.

 
 
  Jim Brown   5/31/02,  2:41:07 PM
Pivot Trade Signals
OOPS! Where did all the bulls go? The markets have taken a turn for the worse as the day draws to a close. We still have an open short signal at 532.25 (SPX 1071.50) which is just under the post economic report lows for the day. Because of the uncertainty of Friday afternoon trading we are going to hold on that entry point. Several readers jumped in after the 535 level comment a few minutes ago and are looking good if the trend continues. Officially, we are still flat and watching from the sidelines. The Nasdaq stopped its descent at 1635 and that could have given the bears a little more reason for caution. Stay tuned!

 
 
  Jeff Bailey   5/31/02,  2:26:56 PM
Verizon (VZ) $43.76 -0.52% .... On bar chart, I've had retracement from $57.81 to $29.01, which has 50% serving as current day support at $43.41. Will set downside alert at $43.41 for bearish entry. The rounding MACD on daily chart also has my interest Link

I think some good observations/correlations can be made for a trader based on the 50-day MA action and MACD from historical. Bear would know about trouble on any DIVERGENCE from the past.

 
 
  Jeff Bailey   5/31/02,  2:25:15 PM
Verizon (VZ) $43.69 -0.68% .... Moody's places the long-term debt ratings on VZ under review for possible downgrade; review is prompted by concerns about 1) the impact of expanding competition and tech substitution (e.g. instant messaging, e-mail) on the industry and specifically the co's operations, and 2) the sustainability of cash flow growth, net of substantial capex, debt service, and dividends, relative to the co's large debt load. Link

I'd monitor VZ early next week for potential bearish entry. One thing I'm liking more now on VZ is that stock had traded $39 at its lows, but at those levels, was very close to its then bearish vertical count of $38 and risk for bears at $39 was high relative to a target of just $38. However, the recent "buy signal" now negates that old bearish count, and a trade at $38, would be triple-bottom sell signal, and if that were to take place, then new bearish count could be established.

With downward regression on the bar chart, good resistance trend just above at $45, so from current levels, bear only risking $1.25. If trade at $38 is ever seen, then bearish vertical count would be $31, if we get 3-box reversal from here.

 
 
  Jonathan Levinson   5/31/02,  2:03:29 PM
Like particular months and strikes, stops are a matter of account management and vary from trader to trader. However, if you're using June contracts to short the QQQ, I would be inclined to set a stop no higher than the day high, which for the COMPX is 1651.47- call it 1652.

 
 
  Leigh Stevens   5/31/02,  2:01:13 PM
Index TRADING Update: QQQ - same technical action as comments made on the COMP - reversal from intraday high right at hourly down trendline and downside hourly stochastics sell signals suggest shorting/put plays on the Q's.

 
 
  Jonathan Levinson   5/31/02,  1:55:35 PM
A break below 1640 on the COMPX will have me salivating for some QQQ puts with the 60 minute and 30 minute stochastics rolling over. However, this being the last day of the month, and there being that congestion area around 1635, I'd characterize this as an aggressive play to be kept on a short leash with tight stops.

Disclosure: I have a short position in the QQQ with back month puts.

 
 
  Leigh Stevens   5/31/02,  1:54:10 PM
Index TRADING Update: Nasdaq Composite - COMP has reversed lower right from its hourly down trendline. This action has also generated a crossover "sell signal" on the 5-hour stochastic and is about to on the longer 21-hour model. All this making the Nas look like its a short/put play.

 
 
  Jeff Bailey   5/31/02,  1:49:02 PM
Qualcomm (QCOM) $32.72 +4.93% ... Jeff, Has QCOM changed course? It has been up for the past 2 days. Is it still bearish on your p/f chart? I have some OCT. Puts. What's your thoughts on it.

Qcom achieved its bearish vertical count (column of O from $43-$35 was the count column) on 05/07/02 of $25 when stock traded as low as $24.63. Since then, stock has been rebounding and the recent column of X (26-33) has given the "low pole warning", which is p/f observation that the stock may be putting in its longer-term bottom. Link

Oct. Put holder needs some resistance to come into play at the $34-$35 level and this correlates with the trending lower 50-day MA. Link Trader will observe that QCOM has tried to break above its 50-day on 3 recent times. Understand that, but also understand any DIVERGENCE from the past. In essence, if QCOM trades above its 50-day and then continues higher, DIVERGING from past pattern, then more hint that stock is starting to find more aggressive buyers.

I don't know what strike you hold, price paid, so I can't give much guidance except that above.

 
 
  Jim Brown   5/31/02,  1:43:50 PM
Pivot Trade Signals
This is enough to make you want to take a long bike ride. (grin) I sure am tempted to raise the entry point on the outstanding short signal to something just below 535 but the lack of shorting at this level as Leigh mentioned could be an indication of things to come. With the first trading day of June typically bullish I don't want to try and force the trade. I also don't want to suggest a new long play with all the indexes struggling at these higher resistance levels. The economic news this morning was encouraging but there was no starters gun for a fast track recovery. The summer doldrums are right in front of us and there is still no compelling reason for buyers to come off the sidelines. With the bounce off strong support at 9800 yesterday and a negative close for the Dow, this +115 point gain is still very suspect. The best play going into the weekend maybe no play at all but we will leave the short signal open a while longer.

 
 
  Jonathan Levinson   5/31/02,  1:37:50 PM
I remember last Friday no one wanted to hold over teh weekend with the world's turmoil. Is there anything on your charts indicating any hesitation for the end of the day today?

Does a last hour selloff look or even seem likely in your view? Obviously, I looking at playing a last hour short today.

The most bearish element I see is that the 1650 level on the COMPX has held so far, and that today's good news combined with the end-of-month timing hasn't yet pushed past that level. However, 1640 has been holding, and the up channel is still intact, though it's rounding a bit under 1650. I think that the 10AM pop on strong economic data has a lot of bears cautious here. I'd prefer to stay patient and see how the day unfolds- it's much better to be out than in when unsure of the outcome.

 
 
  Leigh Stevens   5/31/02,  1:25:47 PM
Index Update: SPX - has traded up to 1079, at pivotal 21-day moving average. (Ditto on OEX, at 536.4). As index has continued to hold its gains pretty well, would not necessarily look to short this market due to low volume. But pricewise, I consider closes over 21-day average to indicate a bullish near-term trend. Conversely, closes under it, suggest bear tracks. Price is king, volume is the "prince" - kings trump jacks. Nice to have both, but we don't here. Then we got the weekend and the CLOSE is another moment of truth so am watching for where we wind up. Surprised that there are not more shorts coming in here as weekend surprises tend to favor the bears - doubtful that peace will break out over the weekend. The 10-day stochastic has popped a bit further over the slower line, and is on a bullish upside momentum "signal" currently.

 
 
  Jeff Bailey   5/31/02,  12:43:48 PM
Aquila (ILA) $13.14 +6.13% .... lots of questions regarding this one today.

CEO makes some comments that put holders from recent profile may want to consider. Link

For me, perhaps best question from subscriber was ..."ILA just announced that they maintain a $1.20 Dividend - that is nearly a 9 % return!! Along with a 'all is well'. Does Technicals superseed fundamentals ? Do we still stand by the technicals on this one ?

Maybe we should ask those who hold the stock long at $21 if the fundamentals superseed the fundamentals, or maybe those at $14.00, or those at yesterday's lows of $12.34. Link

To tell the truth, I don't know who to believe anymore. The analysts or the CEO's of company's. I do know this. I believ in the MARKET. Therefore, I'm going to trust the technicals. First sign of trouble for bears is trade at $18 as outlined from point/figure chart. Link

"Nervous" bear sees that today is "inside day" and could use any break above yesterday's high as stopping point.

In last night's wrap on PI, I made note of Smith Barney downgrades in the "energy merchant" sector and ILA was one of the stocks mentioned. Analyst Ray Niles thought this group could trade at "asset value" until current issues are solved. I'm not sure what "asset value" Mr. Niles would use, but I did look at the Book Values of the stocks mention. Aquila's (ILA) book value is $22.43.

Other stocks Mr. Niles downgraded and their book values were EP=$17.56, MIR=$13.62 and WMB $11.18

Observation made was that EP and WMB still trade above their book values, while MIR and ILA trade below.

Discolusure... I currently hold bearish positions in WMP and ILA.

 
 
  Jeff Bailey   5/31/02,  12:19:06 PM
CNF Inc. (CNF) $36.29 +0.80% ... Jeff: I'm in shock. My CNF June 35's are at break even. What do I do now? Do you see any more good news from your charts?

Not sure why we should be "in shock" on this one. P/F chart has been and still is bullish. Once again, I think stockcharts.com has "adjusted" the p/f chart for a dividend and messes things up a bit. Stockcharts.com shows a triple-top at $35 Link , while Dorsey/Wright (not adjusting for dividends) shows bullish triangle. Regardless, both bullish p/f patterns.

For CNF trader holding June $35 calls, expiration is just around the corner. Need a spike in the stock. Based on retracement, I'd sell any type of spike above the $38 level into expiration.

To get that spike, trader needs a catalyst. Keep an eye on the Dow Transportation Average (TRAN) 2,761.04 +1.58%. A move above the 50-day could be the catalyst, or break above 2,800 consolidation. Link

Another thought is to simply sell options at break-even and roll out to end of year, perhaps waiting for TRAN to clear the 2,800 level.

 
 
  Jim Brown   5/31/02,  11:57:38 AM
Pivot Trade Entry Point Alert - OEX/SPX/DJX
Let's try this again. With the Lowes reduced guidance and the failure of that last attempt to break the stalemate I want to reinstate the previous OEX/SPX/DJX SHORT if the OEX trades below the post report low of 532.57. For safety sake let's make the entry point a trade below 532.25 (SPX 1071.50 est)

 
 
  Jonathan Levinson   5/31/02,  11:54:19 AM
Looking at add a little long here on this pullback--do you like gg or gfi better here? or another? Thanks Phoenix goldbug

I'm a bigger fan of silver miners, to tell you the truth, due to the reports I've heard on silver and its alleged monster short position. GG looks toppy at the moment, GFI is in a fall and looks like a short term falling knife, and even HL, a silver miner, looks overbought at the moment. I'm in a wait and see mode here on metals at these levels, though bullish long term.

 
 
  Jim Brown   5/31/02,  11:40:17 AM
Pivot Trade Exit Point Alert - OEX/SPX/DJX
Ouch! No sooner than I made that last post and a sudden uptick, probably a small buy program, busted through the intraday ceiling and all the indexes are setting new highs. We were stopped out of the OEX/SPX/DJX short at 11:33:12 when the OEX traded above 535.25. (SPX 1076 est) We will sit patiently and see just how this develops.

 
 
  Jonathan Levinson   5/31/02,  11:38:25 AM
Looks like that break just triggered on the COMPX with highs of the day printing above 1650 as I type.

 
 
  Jim Brown   5/31/02,  11:35:51 AM
Pivot Trade Signals
Somebody hit my computer please. I think my Qcharts is stuck! The markets are churning in place at resistance of 10000/1650/1076. The ranges are narrowing but there is no clear post report direction. The adv/dcl ratio is positive at 1.67 and stable and the new highs are still beating new lows by almost 2:1. There is just not enough buying pressure at the moment to break these resistance levels. The bears have got to be getting nervous. Treading water at resistance is not a recipe for closing shorts for a profit before the close. They have to be thinking "should I bite the bullet here." If the indexes tick up just a couple of points the entire picture could change. That could be the signal to start covering those shorts.

 
 
  Leigh Stevens   5/31/02,  11:26:17 AM
Index Update: QQQ is breaking out above it's hourly down trendline - at 30.9 its above this resistance. Next key reistance is 31.5, then 32.

 
 
  Jeff Bailey   5/31/02,  10:58:10 AM
Nice job BigGuy! Threw RIMM to the dogs pre-market for 10%+ gain...Ya know, I'm being serious here, when I grow up, I want to be just like you...What gives with these winners? You stay up all night doing research or something? Geez! What do ya think about climbing back in it?

(grin)... be careful on who you pick as your "when I grow up, I wan't to be just like...."

Good trade for short-term, no qualms with taking a gain. I'd look for re-entry back near the $15 level, or if possible, wait for a good trade setup from "inside day" like that of 05/24 "inside day" and break lower on next session of 05/28. Stock was defended this morning and may not make 52-week low close, thus some short-term bears (not unlike yourself this morning) may further cover and get stock back near $15. Link

And yes, I spend a lot of time looking at these funny charts, picking up on some various info from the newswires to try and put some scenarios together like we did on RIMM. Then, if the charts hint that the scenario is in play, worth acting on most of the time.

 
 
  Leigh Stevens   5/31/02,  10:42:52 AM
Index Update: SPX has traded to key 1075 area, which is the acid test for the bulls. Ability to trade and stay above this level (on subsequent reactions) is an important technical test. If SPX doen't get thru 1075, look for another drift lower. Above 1075, am looking at 1079,at 21-day moving average, as important. Expect selling pressure in this 1075-1079 zone - SPX would need to churn thru this area to suggest a more bullish technical picture, especially holding above it at close. Would note also bullish upside crossover on 2-week daily stochastic (10-day, not 14) with faster line just poking above the other, showing some upside momentum here. This after the 10-day stochastic fell to oversold area recently.

 
 
  Jim Brown   5/31/02,  10:42:36 AM
Pivot Trade Entry Point Alert - OEX/SPX/DJX
We were triggered on the OEX/SPX/DJX short signal at 10:36:12 when the OEX traded below 532.75 (SPX 1072.22 est). The initial stop loss will be 535.25, (SPX 1076.50 est), just over the days high of 534.66. If a rally appears it will have to set a new high over resistance at 535 (1076) to close the position.

 
 
  Jonathan Levinson   5/31/02,  10:36:31 AM
Choppy here just below 1650 resistance on the COMPX, but still well back within the upchannel. Waiting patiently.

 
 
  Jeff Bailey   5/31/02,  10:33:23 AM
Michael Stores (MIK) $43 +11.68% ... talked about this one late last night in the market monitor. I like it long here, market. Link with trade at $43 a triple-top buy. Stronger than expected earnings last night.

Stop would be $37, target $65 by end of year.

 
 
  Jim Brown   5/31/02,  10:21:45 AM
Pivot Trade Entry Point Alert - OEX/SPX/DJX - Corrected
The indexes are all nearing resistance and could fail anytime if the breakthrough is unsuccessful. This is a Friday with war risk over the weekend. Not a strong reason to go long. Resistance on the OEX at 535 could be strong. Let's SHORT the OEX/SPX/DJX if the OEX trades below 532.75 (SPX 1072 est- CORRECTED FROM 1070)

 
 
  Jeff Bailey   5/31/02,  10:20:06 AM
Hi Jeff, How are you? How would you put a retracement bracket on THC? its near its high. I want to try to target price. PnF needs to print 76 for a target. Regression from late February looks like it has a lot of room. What do you think? holding June 75 calls. Look forward to seeing you in October. I might be oout earlier for business.

I'm doing just "ducky."

I've taken a retracement from $52.49 (August and Sept. lows) and "fit" the lower 38.2% at $63.00 (Oct. 2001 high, and 50% at $66.26 (01/16/02 high). This results in a 61.8% at $69.51 (nice tie in with 04/15/02 and 05/14/02 support) then 80.9% at $74.77 (recent resistance) and then 100% up at $80.04.

If THC can give the "buy signal" at $76 from current column of X, the vertical count can begin to be calculated as $71+((6*3)*1)=$89. Link

Interesting.... take the retracement from $52.49 and just for grins drag the 100% up to $89. Boom! 61.8% is at $75 and 50% at $70. That's been pretty darned close to the range since April.

 
 
  Leigh Stevens   5/31/02,  10:17:18 AM
ON THIS DAY in 1900, U.S. troops arrive in Peking to help put down the Boxer Rebellion - this was not a demand to wear boxer briefs rather than the other kind, but a rebellion against foreign domination. Seems somethings never change. Also ON THIS DAY in 1969, John Lennon and Yoko Ono recorded "Give peace a chance" - we wish, and they should make both sides of the Kasmiri divide listen to this non-stop until they do.

 
 
  Leigh Stevens   5/31/02,  10:13:58 AM
Index Update: good numbers on Factory Orders & Consumer sentiment giving a boost to the S&P segment especially - SPX nearing key resistance at 1075-1076, OEX at 536 and DJX at 100.6 - the talking heads say, 100 (Dow 10,000) is key level, but its mostly a feel good area. Well, we could use some of that as our government asks non-essential personnel in India and Pakistan to get out of town, er the country.

 
 
  Jim Brown   5/31/02,  10:13:57 AM
Pivot Trade Signals
Bullish sentiment appears to be soaring but the markets have stopped dead after the initial post-report bounce. Adv/dcl are almost 2:1 positive as well as new highs/lows. The Dow has stopped just below 10,000 as traders battle over control. This could still go either way but my first impression is to short the bounce despite the bullish sentiment.

 
 
  Jeff Bailey   5/31/02,  10:03:34 AM
Factory Orders for April shows a 1.2% gain, much stronger than the forecast for a 0.3% gain.

 
 
  Jonathan Levinson   5/31/02,  10:02:52 AM
Stopped out.

 
 
  Jonathan Levinson   5/31/02,  10:01:25 AM
This move down on the COMPX looks to have violated the up channel from yesterday afternoon. I will try a quick scalp with a tight stop using current month QQQ puts. I'm willing to risk no more than the commission here.

 
 
  Leigh Stevens   5/31/02,  9:59:47 AM
Wall Street Journal has front page story on how Jack Grubman, one of the current love to hate Steet analysts, was "instrumental in making key management and business decisions" at Global Crossing in 1998-2000, after the stock went public. No wonder they're in trouble! This revelation and story is expected to add fuel to the fire of NY Attorney General Eliot Spitzer's investigation into conflicts of interest among Street Analysts. NY's top cop is wondering if some of Grubman's pay was tied to this role rather than any kind of "objective" analysis, which he was purporting to pump out.

WSJ also reports that Disney's (DIS) CEO, Michael Eisner is facing increasing calls to improve the stock's performance and do some better planning for the future. Maybe this is why DIS is up a fraction, but so are 17 out of the 30 Dow stocks.

 
 
  Jeff Bailey   5/31/02,  9:56:58 AM
Intl. Business Machines $81.27 -1.19% .... stock diverging a bit from this morning's broader market action. Trading floor "rumor" that a 10 million share block of IBM is being shopped. Link

 
 
  Jeff Bailey   5/31/02,  9:55:17 AM
Michigan Sentiment May revised number is 96.9 versus the preliminary 96.0. Pretty much in line with consensus and should have little impact on trading.

 
 
  Jonathan Levinson   5/31/02,  9:48:42 AM
XAU, the Gold and Silver Index, is up 1.61 to 85.31 as I type and gold trading above $327 per ounce. Take your pick of probable reasons- I suspect it's *not* a sudden surge in demand for jewelry, though.

 
 
  Leigh Stevens   5/31/02,  9:45:28 AM
Index Update - Support & resistance: Nasdaq Composite - COMP near support > 1607, at yesterday's low, then 1600; near resistance > 1653-1654, then 1672-1673, at next higher hourly swing high; NDX - near support > 1200-1202; Nas 100 coming up on near resistance at 1247-1248, then 1263; QQQ - near support > 29.9-30.0; near resistance > 31-31.1, then 31.5.

 
 
  Jeff Bailey   5/31/02,  9:36:30 AM
Research in Motion (RIMM) $13.39 -8.6% ... stock getting hit to downside after last night's warning from PALM. RIMM's break of $13.70 was new 52-week low. Those RIMM December 15 puts (RULXC) are looking better each day. Link

Soundview is defending the stock this morning, saying that PALM's troubles are PALM specific and shouldn't be taken as a reflection of RIMM.

Disclosure ... I currently hold a bearish position in RIMM.

 
 
  Jonathan Levinson   5/31/02,  9:33:49 AM
The Nasdaq 100 bullish percent index (BPNDX) dropped to 34 yesterday from its previous day's close of 36.That is, 34 out of the 100 NDX companies are trading on buy signals as of yesterday's close. Readings below 30 are considered oversold and are indicative of intermediate bottoms in the Nasdaq-100. To give you some perspective, this index hit 50 during this month's Nasdaq high and 17 during the May lows. This tells me to expect some indecision, and if the Nasdaq 100 rallies from here, I don't expect it to be a major one, not having launched from oversold territory.

 
 
  Leigh Stevens   5/31/02,  9:31:18 AM
Index Update - Support & Resistance: SPX - near support > 1054, at prior low; near resistance > 1075, at prior support; OEX near support > 523, at yesterday's low; near resistance > 535-536; DJX near support > 98, at lows made twice now; near resistance > 100-110.2; anticipate continued upside bias based on near-term oversold. However, with trading light and ahead of a weekend with India/ Pakistan tensions high, doesn't look like buyers are going to flock in to take them above even minor resistance overhang.

 
 
  Jeff Bailey   5/31/02,  9:27:05 AM
Teva Pharma (TEVA) $67.10 .... I see this was OI's "play of the day" yesterday. Link

I have stock as "drug" and that sector is "bear confirmed" at 34%. In essence, OI is trying to pick one salmon to swim up stream, in what looks to be a group that is trying to swim from the upper stretches of the mountains back to the ocean. While TEVA supply/demand chart is bullish and currently has a vertical count of $81, I would have bought as much time as possible in the calls. Stock could easily pull back to the $63 level.

When I look at the bar chart of TEVA, I see the daily interval chart MACD flattening out at a high level. Link and I've seen little success from this technical pattern for bulls in recent months.

 
 
  Jim Brown   5/31/02,  9:21:17 AM
Pivot Trade Signals
Productivity was revised only slightly from 8.6% to 8.4% and should not have any impact on traders today. What could have an impact is the Consumer Sentiment, Chicago PMI and Factory Orders reports all due out at 10:AM. This barrage of economic data 30 min after the open should keep a lid on that first 30 min of trading. While the futures are slightly positive in pre-market there is no reason to get too excited until after these reports.

Palm lowered revenue guidance after the close last night and was downgraded by several analysts this morning along with Handspring. Countering the negative impact of that warning were positive comments about the semiconductor sector. It should be an interesting day.

The Dow has resistance at 9940-9980 with support at 9875 and 9800. The Nasdaq has intraday resistance at 1637-1650 with support at 1610 and 1600. The S&P has resistance at 1067-1072 and support at 1054. Needless to say we could see a narrow range of trading today without any catalyst from the 10:00 economic reports. We will be waiting patiently on the sidelines until then.

 
 
  Leigh Stevens   5/31/02,  9:15:09 AM
Good Morning - It's Showtime! S&P futures trading up 4.2; DJ futures + 34; Nasdaq contract is 8.50 higher currently.

The Semiconductor Index ($SOX.X) had a good-sized rebound yesterday from near prior lows. The Semiconductor Industry Association (SIA) reported that sales in April are continuing the "steady growth exhibited in the first quarter of this year". The SIA reported worldwide semiconductor sales for April totaled $11.07 billion, up 3.1 percent from March's $10.73 billion, led by an increase in sales to the wireless sector. They further indicate that they expect this same pace of sales grownth to continue thru the rest of this year. I featured the SOX index last night in my Sector Trader update at Link

 
 
  Jeff Bailey   5/30/02,  10:17:50 PM
Market Monitor has been archived! To see Thursday's comments, simply click this Link

 
 

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