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  Jim Brown   9/9/02,  9:42:43 PM
The Swing Trade Game Plan has been posted: Link

 
 
  Jim Brown   9/9/02,  9:41:10 PM
9/11 News Continued

At 6:57 PM Dow Jones reported that US and Philippine government had uncovered a plot to attack the US and Israeli embassies there. At least four tons of explosives are reported missing and informants have told authorities that Al Qaeda suicide bombers were already in the country for the attack on 9/11. Military forces are on the highest alert.

This is the kind of news that will blunt any rally attempt because we already know there are active cells in the US.

 
 
  Jonathan Levinson   9/9/02,  4:01:58 PM
Actually, that was me thinking about buying some calls! Either that, or Shelley just jumped in.

 
 
  Jim Brown   9/9/02,  4:00:54 PM
Swing Trade Signals
That was a serious sell program! The TICKS went from +660 to -500 in only 2 minutes. Somebody either tried to kill the rally and blunt the sentiment or somebody saw the market on close orders were positive and decided to bail at the last minute!

 
 
  Jonathan Levinson   9/9/02,  4:00:40 PM
Then again, some bearish crosses in overbought on the 30 and 60 minute stochastics could leave a bad taste for those who got long above the 5 period sma on the 5 minute chart :)

 
 
  Jim Brown   9/9/02,  3:55:10 PM
Swing Trade Signals
A close at the high of the day would go far towards stimulating other buyers to come off the sidelines tomorrow. Is that a train whistle they hear? Don't want to miss it! (grin)

 
 
  Jim Brown   9/9/02,  3:49:42 PM
The game plan tonight is going to really easy - "Hang on"

I hope Weldon is shooting the best game of his life today! Thanks to all those readers who have emailed about supporting the rally by going short. The rest of us appreciate your support!

 
 
  Steven Price   9/9/02,  3:45:08 PM
Reader Question: Steve thanks for the write up on FRX. Ok i am in the straddle. although i waited to enter the put side (entry 2.95).. With 9/11 coming up and possible rally im having trouble taking the short on the stock here. Dan

Reponse: Forest Labs (FRX) $73.10 (+2.60) You can always let it run and use a stop market order to go short if the stocks turns over and breaks below $73. You can move the stop up if it keeps running. For those of you who would like to see the analysis of a long straddle on FRX, here is the link. Link

 
 
  John Seckinger   9/9/02,  3:42:59 PM
Are bullish Intermarket relationships starting to take hold? Dollar above 22 DMA, yield curve flattening, and an explosive rise out of the CRB index (Commodity Index, which should trade inversely to bonds) all point to higher equity prices. The CRB's (CR00Y) move during the last few sessions is impressive, and this could be the catalyst for lower bond prices and higher yields. Gold is higher, oil and utilities are lower; this isn't part of the bullish plan. Regardless, I would now put the CROOY ticker on the radar screen and see how bonds and stocks become affected.

 
 
  Jim Brown   9/9/02,  3:25:05 PM
Swing Trade Signals
Quite a battle going on here at 453. As I said before this is good! If we can break through strong overhead resistance on light volume then the conviction of the bears is decreasing. I especially like it because all the major indexes are gaining equally. Good steady patterns with only minor pullbacks. I would say Thursday is shaping up as a banner day and Tue/Wed may not be shabby either. However, it could be that the bears are saving their strength for a couple days after the 11th. That is when we will be tested again.

 
 
  Kent Barton   9/9/02,  3:22:08 PM
The 3:15 PM intraday update has been posted. Link

 
 
  John Seckinger   9/9/02,  3:10:21 PM
Federal Reserve Bank of Chicago President Michael Moskow said the U.S. recovery from last year's recession remains on track although the path of growth is uneven. These comments were similar to earlier comments by Boston Fed President Cathy Minehan. "Most significantly, the long-term prospects for heightened productivity growth appear bright, thanks to more flexible labor markets and improvements in technology and the skills of workers," Moskow said. Non-farm productivity, year-over-year, is at 12-year highs while Unit Labor Costs are at at least 12-year lows; therefore, productivity growth plus trend labor force growth (equaling potential GDP growth) could equate to an impressive four percent GDP growth. Downside? Near term labor demand worsens with stronger growth in productivity.

 
 
  Mark Whistler   9/9/02,  3:06:58 PM
U.S. Consumer Credt up to 10.8 billion in July, versus previous 8.9 billion. The number topped the 9.8 billion consensus. Further, Consumer Credit for June was revised from 8.4 billion to 8.9 billion

 
 
  Steven Price   9/9/02,  3:06:31 PM
Reader Question: What do you think about ITMN? It's now made 13 Xs on the PnF chart in only 2 weeks! I want to short it. But it doesn't show any weakness. Chris

Response: ITMN $28.56 (+1.17) I had been looking at this stock as a long last week but saw a lot of resistance between $25 and $26. Once it broke out with a big gain on Friday I didn't want to chase. The next level of resistance is $30. I realize you are looking at it short and my response is more along the lines of analyzing it long. This is for the same reason you have already identified - it doesn't show any weakness. The PnF extension does look hard to maintain and a reversal at some point is likely. However, until I see a weakness in the stock, there is no real reason to short it (unless you simply want to try and pick a top, which is usually a crapshoot).

 
 
  Jonathan Levinson   9/9/02,  2:58:40 PM
Mark notes that the COMPX came to dead stop at the 10 day EMA. On all shorter timeframes, price is trading above it. A break below the 5 minue EMA at 1305 will be the first step in establishing a failure of of the afternoon rally, following which I would target 1292 and 1287 as the next significant support levels. We've just had a new high at 1310 as I typed that, and will not start holding my breath just yet.

 
 
  Jim Brown   9/9/02,  2:57:41 PM
Swing Trade Signals
That was some decent selling at OEX 452 but the bulls held the line and it looks like we are going to get through it. This is a good sign. If we can break resistance in this extended state then there are more buyers behind this than anybody expected. I would love to see a nice steady move to the next major resistance of 466-468 and then a breakout on 9/11-9/12 That would be the perfect setup for a major rally.

 
 
  Jonathan Levinson   9/9/02,  2:53:51 PM
The COMPX is almost drawing a confusing pattern that Bulkowski describes as a descending broadening pattern, although today's action on the 30 minute chart in fact gives us what he terms a broadening top or megaphone. In the latter case, which looks the closest to me, he predicts a bullish move most of the time. However, he also notes that a partial rise at the end of the formation predicts a downside breakout 65% of the time. Unlike with other formations, the megaphone is uncertain enough so that I'm not inclined to trade on it. Given the unique external circumstance of 9/11 this week, I'm even more sceptical of an unclear chart-based conclusion, and will follow the oscillators instead. The twitchy 5(3) setting is showing the 60 and 30 minute stochastics starting to curve down from overbought. However, there is no clear signal yet, and I wouldn't rule out another blast just yet. I'm watching COMPX 1310 closely.

 
 
  John Seckinger   9/9/02,  2:45:16 PM
Well, Bond futures seem relatively content with the rise in the Dow. Five-year notes weakened slightly as equity prices rose, and also underperformed the 10-year note as the yield curve "flattened". It is actually a significant move, and should keep an underpinning bid in stocks. So, why content? The 30-year price remains higher and is not doing any technical damage, yet. The “technical damage” could take place a full three full points lower (96/32nd's); therefore, the 30-year can rise quite a bit in yields before talk of a mass exodus takes hold. The "flattening" yield curve does mean cash is exiting shorter-dated Treasuries for stocks; however, this allocation is more "rational" and less explosive.

 
 
  Steven Price   9/9/02,  2:34:43 PM
Reader Question: Steve, Is Autozone (AZO) ready to make a move. It seems the move will be down. Any thoughts? Thanks, Lee

Response: A look at AZO's chart actually shows an ascending wedge. There is a series of lower bottoms, on 7/24, 8/08, 8/12 and 09/05. There is resistance just over $75, forming a flat top to the pattern. The stock is above the 200-dma of $71.34 and a break above $75.60 would look bullish. Resistance looks to be $77.50 and $80.00. The trade of $74 created a new PnF buy signal and $76 would be a triple top breakout. The stock is currently on our OI Watch List for a trade over $75, or a successful re-test of the 200-dma as long entry points.

 
 
  Jonathan Levinson   9/9/02,  2:30:32 PM
This has been a dramatic half hour, with volume breadth reversing to a 2:1 ratio in favor of advancing shares, and the COMPX taking out Friday's highs. The intraday 5(3) stochastics have all reached overbought, but with no sign of a rollover yet. While the QQV is still up 1.36 on the day, the TRINQ is reaching extreme overbought territory, at .37 down from highs near 2 today. QQQ posted a high of 23.30, and is currently no far off it now. Volume is still very light on the COMPX at 855M on the day, which is facilitating this move up. Price is the only action, but there's not a lot of strength supporting it. With 9/11 looming, I don't expect these levels to hold, but will not short the index until that rollover is occurring. I am watching 1310 COMPX as the next resistance level.

 
 
  Jim Brown   9/9/02,  2:29:06 PM
Swing Trade Entry Point Alert - OEX/SPX/DJX/DIA/SPY
Don't fight the trend! We were triggered on the LONG signal at 14:24:00 when the OEX traded above 451. (SPX 902.21, Compx 1304.26, NDX 934.54, DIA 85.25, SPY 90.88, DJX 84.98, Emini 903.50) The initial stop loss will be OEX 446 (SPX 894, DJX 84.30) and the current trigger point for our SHORT signal. That last little spurt that put us over 451 was a buy program and we need some short covering or some real buying to continue it.

 
 
  Jim Brown   9/9/02,  2:16:26 PM
Swing Trade Entry Point Alert - OEX/SPX/DJX/DIA/SPY
Let's raise the trigger point on the SHORT entry to OEX 446. (SPX 894, DJX 84.30) This rally looks like it might make it but should selling appear it could be swift. I would love to be short here if a roll over occurs.

 
 
  Jim Brown   9/9/02,  2:07:35 PM
Swing Trade Entry Point Alert - OEX/SPX/DJX/DIA/SPY
I am not convinced this rally has legs but it is possible we could be seeing the post-9/11 buying beginning. Since there is strong resistance at 450 I have been expecting a failure here. If it does not fail and gets through this resistance then shorts may start covering. This is very light volume.

Let's go long on a breakout over OEX 451. (SPX 901, DJX 84.85)

 
 
  John Seckinger   9/9/02,  2:01:21 PM
Side Notes: In this morning's WSJ, it was reported that Michael Carpenter was ousted as head of Citi's global corporate and investment bank due to questions over practices at Salomon. In other news, President Bush addresses the United Nations on Thursday while Greenspan is expected to give a balanced speak to the House Budget Committee. Elsewhere, Japanese analysts believe the country will post a -1.0% percent reading for calendar year 2002 GDP. There are rumors the country is scrambling to figure out an anti-deflation package. I think I have heard this all before, so I am not going to hold my breath.

 
 
  Jonathan Levinson   9/9/02,  2:00:46 PM
Volume is very light today, with just 747M shares traded so far on the COMPX. 430M of these are declining shares, 302M advancing. Obviously trading is not what most participants are doing ahead of 9/11, and to my mind this supports the chances of a rally developing if 9/11 does not bring any new disasters. The COMPX is back into the congestion area from Friday, currently 1294, and while I'd love to see a big move down from here, it doesn't feel like it's going to happen- I would doubt we'll see much action in either direction. With that thought committed to writing and on record, the market is now free to rocket for us. The TRINQ remains at .95, QQV is now up 3 to just above 50, yields are slightly negative, and gold has given up some of its gains but is still strongly positive on the day.

 
 
  Steven Price   9/9/02,  1:49:27 PM
Reader Question: Hi Steve,could you please comments an old OI favourite MXIM? Time to go short again??

Response: Maxim (MXIM)$28.60 (-0.25) Our old favorite Maxim (any play that results in an $8 winner constitutes an old favorite) has been moving sideways since we closed it last week. This morning's drop to $27.45 looked like it was giving in for a another drop, but it found some legs along with the broader markets and is back in familiar territory between $28 and $30. I would wait for the Semiconductor Index (SOX.X $286.01) to break back below 275, and then hold there before going short a chip related stock. As the market bounce seems to be holding, I would wait for a decisive rollover before initiating short plays right now.

 
 
  John Seckinger   9/9/02,  1:47:00 PM
With the Dow higher by 0.23 percent and the Utility Index (UTY) lower by 1.11 percent, stocks that should continue to underperform include FPL, D, PCG, and DKE. Two companies that seem poised for an explosive move include SO and REI. Note: The Utility Average has posted a net loss 7 out of the last 9 sessions. One session was unchanged.

 
 
  Steven Price   9/9/02,  1:33:20 PM
Reader Question: Steven, Do you think $indu on 1 min chart is forming h&s pattern, neck line will be at 8400? Thanks AP

Response: With the current series of bull pennants, I don't really see the H&S, although a 1 min chart can provide plenty of fluctuations in the time delay between email and response.

 
 
  Jonathan Levinson   9/9/02,  1:28:33 PM
The COMPX, led by QQQ, is pressing for a fill of this morning's opening gap and is at the first upper resistance level. I expect it to be tough sledding for additional gains from here. The TRINQ has entered buy territory below 1, currently .96. Bond yields are still negative but improving, and QQV, still up over 2 points today, is back below 50.

 
 
  John Seckinger   9/9/02,  1:27:55 PM
With the Dow now posting a net gain on the session, sectors underperforming the Dow include Utilities, Oil, Semiconductor, and airline stocks. Sectors outperforming include Gold and Silver, Biotech, Insurance, Internet, and Healthcare.

 
 
  Mark Whistler   9/9/02,  1:27:43 PM
The 1:00 PM intraday update has been posted. Link

 
 
  Steven Price   9/9/02,  1:20:46 PM
L-3 Communications (LLL) $54.78 (+1.94) OI call play LLL has broken out of congestion and through its 200-dma. Today's trade of $53 broke through the bearish resistance line on the PnF and $54 added another box. The current bullish vertical count is $59. The stock traded as high as $55.00 and a break through this level will show new legs after today's already impressive run.

 
 
  Steven Price   9/9/02,  1:11:56 PM
Semiconductor Index (SOX.X): 284.33 The magic number in the SOX is 293 from where I sit. The current rally looks positive, as the predicted pre-9/11 sell-off has bounced back close to even. But the SOX.X saw heavy resistance on the short-term chart (5 min) on Friday just over 290, with a high of 292.56 on Friday morning.

 
 
  Jonathan Levinson   9/9/02,  12:43:22 PM
The COMPX has done a whole lot of nothing in the past hour, with 1280 resistance continuing to hold and forming an ascending triangle with a series of higher lows on the 5 minute chart. The TRINQ is lower on this gradual move higher, ditto the QQV, though bond yields remain soft and metals are adding to gains, HUI now +5.59 and XAU +3.56. We have gap resistance on the COMPX at 1286. If the ascending triangle breaks north, I will watch 1286 to assess the strength of the move- a gap fill will bring Friday's highs into play as the next strong resistance level.

 
 
  John Seckinger   9/9/02,  12:21:20 PM
With October Crude Oil lower by 10 cents to 29.51 and failing to hold levels above $30 (intra-day high of 30.20), analysts now believe that the "war premium" reflecting uncertainty over Iraq has added between $4 and $6 a barrel. It is my opinion that lower oil prices would not be good for equity markets.

 
 
  John Seckinger   9/9/02,  12:15:33 PM
Verizon Communications Inc. (VZ) reaffirmed their 2002 fiscal outlook, despite continued weakness in the telecommunications sector. Their CEO said the company will earn $3.05 to $3.09 a share this year on revenue that will be flat or decline by 1 percent. VZ is currently the No. 1 U.S. local telephone company. Shares are lower by 2.51 percent at 29.08.

 
 
  Steven Price   9/9/02,  11:47:34 AM
Reader Question: Hi Steven, When looking at the IBM chart there seems to be significant support @ $72 (DOUBLE BOTTOM). 60 min chart shows completion of the H&S pattern. I'm not sure but $72 looks better as a buy then a sell here especially with the expectation of a post 9/11 rally ...

Thank you and all rebuttals welcome (grin)

Response IBM $72.15 -1.05 Your obsevations are well taken and should be looked at when considering a short. I see declining volume on Friday's rally and the stock back into previous consolidation with heavy resistance at $74. A more conservative approach to going short on IBM would be to wait for a break below Friday's low of $71.50 for evidence that a double-bottom has failed. Comments from Cymer about the semiconductor market slowing and IDC regarding lower PC estimates for this year and next, have me leaning shorter in the hardware techs, but as a Dow stock IBM is still subject to a program trading rally after Wednesday. If you have been short since $77.96 (or thereabouts) along with us and feel uncomfortable with IBM's short prospects, this would be a good point to take profits. I am looking for a few dollars to the downside, with a stop at $74.

 
 
  John Seckinger   9/9/02,  11:41:47 AM
The December Bond (evidently trading opposite of equities in terms of price), has used 111 as support and is now back above the old relative high of 111-04 (currently at 111-06). If stocks fail to retest lows (8315), I would not be surprised to see fixed-income holders square positions and take profits. The question is, "Will a non-event this week be treated as an event?" If yes, bonds should come under pressure and fall in price (higher yields).

 
 
  Jonathan Levinson   9/9/02,  11:38:24 AM
In the interest of overanalyzing things, it looks like we got a higher low on the COMPX just now, just below the 1277-1281 congestion zone that stopped the last bounce dead. Let's see how it goes from here. The TRINQ has edged higher to 1.86 and QQV is up a bit, now +3.53 on the day.

 
 
  Jim Brown   9/9/02,  11:35:26 AM
Swing Trade Entry Point Alert - OEX/SPX/DJX/DIA/SPY
Go SHORT the broader market with an OEX trade below 435. (SPX 870, DJX 82.00) I do not expect this trigger to be hit but if we trade at this level there could be a substantial drop that follows.

 
 
  Steven Price   9/9/02,  11:34:38 AM
Reader Question: What puzzled me is this: CYMI was the Play of the Day on Tue. with a target of $15 and possible support at $21 and by Thur. the play appeared right on track in a down market, closing at 21.73 for a modest profit. Yet with all the original reasons for the play seemingly still valid, the play was dropped. Was the Intel announcement that big a factor? Of course, the gap up on Friday effectively wiped out any profit from the play.So it appears that a quick exit is in order. Would appreciate your thoughts. John.

Response: Cymer (CYMI): $21.71 (-0.94)Intel's announcement was better than expected, and the SOX had found support. After the announcement, the chip stocks were trading up after hours. We closed several of our semiconductor plays for a healthy profit, rather than play with fire. It appears the Semiconductor Index (SOX.X) rebound has failed, but at the time we felt we shouldn't look a gift horse in the mouth and decided to take profits across the board. While Cymer didn't move as much as Maxim (MXIM) or QLogic (QLGC), we felt a small profit, or in this case with the gap up, getting out flat, was the prudent move at the time. Cymer has dropped back to its previous level, however I'm still looking for the SOX to take out recent lows (below 275) before initiating additional shorts in the semis. Cymer did set a new recent low this morning, which is bearish, and if I were still holding the play, I would probably move my stop down to $22.50, just above Friday's high.

 
 
  Steven Price   9/9/02,  11:34:08 AM
The 11:00 AM intraday update has been posted. Link

 
 
  Jim Brown   9/9/02,  11:30:57 AM
Swing Trade Signals
With the internals weakening as quick as the strengthened 30 min ago I am really ticked about getting stopped out. I could see this market really tanking based on the current sentiment. I am not willing to go short here again however since there is strong support at 436. I am going to set a trigger below 436 just in case we do get a rush to exit this afternoon.

 
 
  Jim Brown   9/9/02,  11:21:55 AM
Swing Trade Entry Point Alert - QQQ
We were triggered on the QQQ long this morning at 10:00 when the QQQ traded below 22.50. The initial stop loss on this signal will be 20.75. This is a post 9/11 play and investors may want to go long the Sept $22 put at tomorrows close to protect against a disaster.

 
 
  Jim Brown   9/9/02,  11:10:09 AM
Swing Trade Exit Point Alert - OEX/SPX/DJX/DIA/SPY
We were stopped out on that last buy program at 11:05:50 when the OEX traded above 444. SPX 890. DIA 84.09, DJX 83.90, SPY 89.63, QQQ 22.62, Emini 890.25. The Dow is showing a bounce here but I am not convinced we should go long yet for a post 9/11 broader market bounce. I will stay flat the broader market for a little while longer.

 
 
  Jonathan Levinson   9/9/02,  11:09:08 AM
The COMPX has just bounced and is now 10 points off its low of the day at 1270. The 5 minute 5(3) stoch is overbought and the 30 minute has given a bullish cross. COMPX 1280, where price is currenly trading, is an s/r line that we remember well, and so we'll see the strength of this bounce right here. The TRINQ is at 1.64, showing steady net selling pressure, and the QQV is up 3.38 on the day. HUI and XAU are holding their gains. This is still far from being a bullish day so far.

 
 
  John Seckinger   9/9/02,  11:03:36 AM
How did you pick 80.91 as the objective for gold?

Response: Looking at a daily of the XAU, there is the look of a H&S ending on June 24th with a right shoulder and high of 80.91. Now time for semantics, that is my "objective"; however, in all reality that will not be the relative high if Gold continues to bid. The 80.91 was chosen because this level should attract investors and spike up liquidity; allowing for better execution. The left shoulder has a high of 80.78. Shorts should defend the area near 80.91, while other traders might want to trigger stops above and squeeze shorts before continuing.

 
 
  Jim Brown   9/9/02,  10:38:55 AM
Swing Trade Exit Point Alert - OEX/SPX/DJX/DIA/SPY
Decline is picking up speed here. Let's lower our stop loss to OEX 444 (SPX 889, DJX 8483.75) and continue to watch for a rebound. I am targeting OEX 439 as an initial exit point since 436 is the 50% retracement level. I will lower the stop loss again (instead of exiting) if we hit that level just in case we fall through it instead of bounce. Conservative investors may want to exit instead of risking being stopped a couple points higher.

 
 
  Jonathan Levinson   9/9/02,  10:36:10 AM
The Fed has added 4.5B in overnight repos, replacing 3B in expiring weekend repos, for a net addition of 1.5B in reserves.

 
 
  John Seckinger   9/9/02,  10:23:03 AM
There evidently is some urgency for either longs to liquidate or shorts to put on positions, as the Dow carves out lower lows and lower highs on a five minute chart. Shorts will try to keep the market at least under 8370, since a rise higher might encourage a short covering rally (most likely not material). Looking for confirmation; the yield curve is neutral, while both Oil and Utility issues are lower (bearish for stocks). For bears to really gain control, the Dollar will have to fall under the 22 DMA of 106.79. The Greenback is currently at 106.94.

 
 
  Jonathan Levinson   9/9/02,  10:20:20 AM
The current decline on the COMPX stopped within 73 cents of my first support target of 1270. The bounce, however, has been lackluster and served only to blow some steam off the TRINQ and the 1 minute 5(3) stochastics. While bears would love to see a straight move down, the slope of the decline from Friday's highs is so steep that I expect at least some chop to intervene, if not a more significant bounce. So far, however, the trend is holding.

 
 
  Jim Brown   9/9/02,  10:16:29 AM
Swing Trade Exit Point Alert - OEX/SPX/DJX/DIA/SPY
Let's lower our stop loss to OEX 447 (SPX 894, DJX 84.50) and be ready to exit if this dip turns around.

 
 
  Steven Price   9/9/02,  10:14:45 AM
AIG $58.55 -0.90 OI put play AIG now trading below Friday's low of $58.57. This looks good for short entries, although more conservative traders may want to wait for a break below Thursday's low of $57.78. My stop would be just over $60, which has been providing resistance. AIG will most likely rally with a non-event on 9/11, so view this as a short-term play to be closed before then.

 
 
  Jim Brown   9/9/02,  10:12:17 AM
Swing Trade Signals
Continuing to drift lower on light volume and no major news. Just more of the same. OEX 440 would be my first target for the current dip with strong support at OEX 436. The markets are on edge and a bomb threat helped provide negative sentiment already this morning. Tomorrow should see more of these culminating with lots of copy cats on Wednesday.

 
 
  John Seckinger   9/9/02,  10:08:20 AM
As profiled in the Index Traders Wrap, Gold had the potential to be a catalyst and seems to be doing just that. Currently higher by 3.29 percent at 75.54, the XAU.X index is getting closer to the 80.91 objective. To read the article, click on the following link: Link

 
 
  Jonathan Levinson   9/9/02,  10:03:16 AM
The COMPX has entered the gap and is easing gradually lower. The TRINQ is in neutral sell territory at 1.86 and edging hight. The QQV gapped up at the open and has been creeping higher, already a large move on the day at +3.21. The QQQ is trading just above 22.50, which is a support level I can recall from past sessions. We'll see how it does. The miners are continuing their move up, with HUI now +4.66 and XAU +2.37.

 
 
  Jonathan Levinson   9/9/02,  9:48:11 AM
The COMPX continues to edge ever closer to that 20 point abyss. If it enters, there should be slight support at 1270, with stronger support at 1260-63.

 
 
  John Seckinger   9/9/02,  9:43:35 AM
The December Bond (USZ2) is currently higher by 16 ticks at 111-04, and exactly at the intra-day high seen on August 14th. This resistance in bond prices may be reason for the slight bid in the Dow.

 
 
  Steven Price   9/9/02,  9:43:31 AM
Semiconductor Index (SOX.X) 283.76 A look at Friday's 5 min chart of the SOX shows a flat-line after rallying just over 290. The group was turned back this morning after Cymer's comments. If the index breaks below 275 I would look hard at the sector for short candidates. Any shorts, however, are short term candidates, as we are looking at a probable rally post 9/11

 
 
  Jonathan Levinson   9/9/02,  9:41:33 AM
The US Dollar Index is trading below 107, but there's already been a huge move in the gold miners, with HUI uo 3.95 to 137.14 after 10 minutes of trading, and XAU up 1.89 to 75.02.

 
 
  Steven Price   9/9/02,  9:36:10 AM
IBM 72.30 -0.90 OI put play IBM saw highs of the day of $73.99 on both Wed and Fri, showing it has once again found resistance at the top of its former range between $66 and $74. I like the current level for short entries, with a stop at $74 or just over, possibly $74.25 for more aggressive traders.

 
 
  Jonathan Levinson   9/9/02,  9:34:43 AM
The COMPX has gapped down 9 points and is now 2 points away from erasing all of Friday's gains. Expect gap support at 1280, below which we could see a gap fill for better than 20 points of downside.

 
 
  John Seckinger   9/9/02,  9:33:53 AM
The 9:00 AM intraday update has been posted. Link

 
 
  John Seckinger   9/9/02,  9:22:30 AM
Merrill Lynch has downgraded food companies IMC, HSY, SLE, HRL and MKC to “neutral” from a “buy” rating. DLM was also downgraded to “sell” from a previous “neutral” coverage. Continuing the company specific theme, EMC was given a negative mention in Barron's over the weekend. The article discusses the long-term threat Cisco’s storage products might have on EMC. One company that got positive coverage was Stelmar Shipping (SJH), noted due to its P/E of 4.5 and fact shares are trading underneath book value.

 
 
  Steven Price   9/9/02,  9:18:35 AM
Cymer: CYMI ($22.65) said it expected 3rd quarter revenue to come in line with previous forescasts, but 4th quarter to come in below 3rd quarter due to slowing semiconductor demand and reduced industry capital spending

 
 
  John Seckinger   9/9/02,  9:17:16 AM
September S&P futures on Globex are currently 4.80 points lower to 889.70, while Nasdaq futures predict the tech-laden index will fall 6.50 points during Monday’s opening. Turning to the September Dow contract, indications are for a weaker opening by 35 points. According to HL Camp and Company, FairValue for the S&P 500 today is $.13. That price will not change during the day. Program buying is set at $1.51 with program selling set at $-1.64. FairValue for the NDX 100 today is $1.18. Speaking of Program Trading, such programs averaged 39.0 Percent of the NYSE Volume during the period of August 26 to August 30. Buy programs were 49.44% of the total program trading volume. Sell programs were 50.55%.

 
 
  Jim Brown   9/9/02,  9:12:23 AM
Swing Trade Signals
Today is shaping up to be a dull news day with the markets appear to be heading lower at the open. How long that direction will hold is anybody's guess. There were no chip downgrades this morning and that is definitely a change. Downgrades appeared limited to food stocks and hotels which are definitely not a market moving sectors.

It appears the market is leaning to the downside based simply on fears of 9/11 events and volume is expected to be very light as everyone should already be positioned for the event. We are short from OEX 447 with a stop loss at OEX 451 (SPX 901, DJX 85.10)

We will play today very conservatively with a view toward getting long before Wednesday. With all the 9/11 specials on over the weekend investors on the fence should have been pushed to make a decision today. Since a decision to stay long will have no impact to the market only those who decided to exit will add to the market direction today.

 
 
  Jonathan Levinson   9/9/02,  8:21:37 AM
The US Dollar Index has made it above the 107.00 level and the futures are off their morning lows, erasing the smile that greeted my in my shaving mirror, currently -5.50 for the NDX and -3.70 for the S&P. Gold, however, broke 323/oz and is currently trading 321.70. The ramp in the US Dollar makes sense to me on the basis of 9/11 speculation and concerns of an attack on US soil. I remember reading Michael Lewis' most excellent Liar's Poker, and his description of one of the more brilliant traders at the then Salomon Bros. They would play "what if" and make hypothetical trading decisions. One of the scenarios was "major earthquake hits Japan" and they decided to first buy yen, because massive amounts of yen would be required to fund the reconstruction. The US Dollar's weekend action makes sense on that basis, although I'm surprised to not see more selling in the equity futures.

 
 
  Jonathan Levinson   9/9/02,  6:54:47 AM
The Nikkei gapped up today and held its gains to close at the 9300 level. The Japanese government announced yesterday that it would commit 3 trillion yen of public money to support its markets by purchasing ETFs (exchange traded funds, like QQQ, SPX, etc). Imagine the PPT issuing a press release announcing a planned buy program and then read all about it at this Link

 
 
  Jim Brown   9/6/02,  11:41:41 PM
The Swing Trade Game Plan has been posted: Link

 
 
  Jim Brown   9/6/02,  11:40:32 PM
The Market Monitor for Friday has been archived but you may read it here: Link

 
 

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