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  Jeff Bailey   3/27/03,  10:27:45 PM
Sector Bullish % at Stockcharts.com I've had several questions regarding any sector bullish % data offered at www.stockcharts.com. Here is a link to their bullish % symbols. Link

 
 
  Jeff Bailey   3/27/03,  10:10:11 PM
Restaurant stock CBRL Group (NASDAQ:CBRL) $27.59 +1.06% is a compelling looking bullish trade in Restaurant sector. Stock has been hugging its 200-day SMA last 6 sessions, with curling upward 21-day SMA offering short-term support. Interesting "volume spikes" shows interest, but hints of major disagreement on where this one is headed right now. Link

Point/figure chart shows potential "bullish triangle" being triggered at $30.00, and vertical count of $57 currently in play as long as negating sell signal of $24.00 not traded. Link

Relative strength of CBRL vs. SPX reversed back up into X in early March and currently would read "relative stregnth buy and column of X." Link

Setting alerts on this one as a "collar" at $24 and $30, but I lead toward the bullish side with relative strength and sector bullish % improving.

 
 
  Jeff Bailey   3/27/03,  9:53:18 PM
Restaurant sector reversed back up to bull confirmed status according to Dorsey/Wright's sector bullish % (BPREST) at 34.27% bullish. A past "winner" that I thought I'd look at was YUM Brands (NYSE:YUM) $24.56 +0.44% Link and I'll set an upside alert at $26.00. A quick look at the bar chart shows the longer-term 200-day SMA at $26.00, and bulls may like this one as a "watch list" as a pattern of higher lows from October has been found. Link

A couple of months ago, a subscriber asked a question about a restaurant stock that owns Burger King. I can't remember the name of the company, but think it was out of Germany and traded on the NYSE.

 
 
  Jeff Bailey   3/27/03,  9:38:18 PM
Pivot Matrix for tomorrow at this Link

 
 
  Linda Piazza   3/27/03,  3:53:58 PM
A reader had a question concerning my 3:17 post about the OEX, when I mentioned that daily 5(3)3 stochastics (or at least the fast line) was hinging up, but not from fully oversold levels and not yet making a bullish kiss, and that the 21(3)3's were trying to hinge from near levels that indicated overbought conditions. What would be the implications if that happened?

That's a great question, but it doesn't have a simple answer. As I've mentioned before, I'm a self-taught trader, but here's what I've observed. Sometimes this kind of action is seen when there's an underlying bid in the market, so that market participants won't let the market get fully oversold before they're jumping in again. However, that kind of buying is sometimes weaker, momentum-type buying. If markets don't get fully oversold, then the weaker hands didn't get shaken out on the downside move, and they might be quick to bail on any hesitation. For example, if you take a look at the OEX hourly chart and study the 5(3)3 stochastics from March 14 to the 21st, you'll see that the stochastics were turning up again from higher and higher levels. That showed a lot of buying pressure, and was a signal to bears that the OEX might get bid up. It should also have been a warning to bulls, though, that the rise wasn't on sound footing. See what happened when that pattern of rising lows on the 5(3)3 was broken on Monday? Market participants bailed and there was a quick exodus and strong selling.

The daily OEX 5(3)3 isn't such an extreme case, however. It was nearly in territory indicating oversold conditions, but not quite. It hasn't yet turned fully turned up, and it might redraw itself several times before that happens. Still, this kind of behavior might indicate some short-term buying pressure that nevertheless might be suspect. At least in my opinion.

 
 
  Jeff Bailey   3/27/03,  3:52:35 PM
Just thinking and perhaps this has been mentioned by other, but this is "end of quarter" for many mutual funds and we may also be seeing some portfolio adjustments.

This may explain some of today's volume interest in McKesson (MCK) and perhaps other stocks you're following.

 
 
  Jonathan Levinson   3/27/03,  3:48:11 PM
Here we are at 1382. I see little sign of a turn on the indicators I follow, but there's nearly a 10 point COMPX profit here, and the close for QQQ options is 25 minutes away.

 
 
  Linda Piazza   3/27/03,  3:36:19 PM
Without a big change by the end of the day, the OEX will print a doji or a near doji on the daily chart. Since it's being printed in the midst of a consolidation zone, however, it just means that the uncertainty that created the consolidation zone remains. I continue to be concerned that the OEX has not been able to retrace 50% of its declines from Monday, but then others could point to the fact that, other than a few hours here and there, the OEX has maintained support, too.

 
 
  Jonathan Levinson   3/27/03,  3:32:40 PM
The COMPX just dove below that ascending trendline on my 3 minute chart, starting from just below 1392. Targeting 1382 on this move down, or, of course, significantly lower levels, but we can't be too hopeful for that in this rangebound muck.

 
 
  Jeff Bailey   3/27/03,  3:27:57 PM
McKesson (MCK) $25.01 -1.18% ... all day today, when stock has traded around the $25.00 level, seeing some large blocks of stock being "crossed" or traded hands. There's some type of interest in the stock from bulls and bears at this level.

From what I've seen, the selling has not been short related selling as much of the volume has come at the bid. Considering the "uptick rule" for shorting, my assumption is that the seller is a bullish liquidator. Who is doing the buying at the bid is a mystery at this point.

 
 
  Jeff Bailey   3/27/03,  3:22:56 PM
Neurobiological Tech. (NTII) $5.50 -8% ... sharp weakness in last 15-minutes. This is company that developed and manufactures Memantine for Forest Labs (FRX) $55.65 +3.05% developmental Alsheimer's drug.

I see no news on NTII to explain this decline, but negative action in NTII a bit concerning.

 
 
  Jonathan Levinson   3/27/03,  3:21:58 PM
Another failure at or just below COMPX 1392 would look shortable to me, but with a stop close by, as low as 1394. I will specify that with less than one hour left of the session, shorts run the risk of a gap beyond their stop tomorrow morning. This aggressive signal is therefore not for the faint of heart, and I'd keep it to risk capital only.

 
 
  Linda Piazza   3/27/03,  3:17:03 PM
Above recent support/below recent resistance: that's about all that can be said about the OEX with any precision. Hourly charts show 5(3)3 and 21(3)3 stochastics cycling back up again as the OEX attempts to break through that 445-447 area. The daily chart shows the 5(3)3 hinging up, but not from fully oversold levels and not yet making a bullish kiss, while the 21(3)3's try to hinge up again near levels indicating overbought conditions. Daily RSI has flatlined and MACD appears difficult to interpret, and the index has not yet been able to retrace 50% of Monday's losses.

 
 
  Jeff Bailey   3/27/03,  3:09:06 PM
Bond Market Closed with 10-year YIELD ($TNX.X) 3.924% seeing some buying into its close, but finishing just about mid-point of today's 3.888%-3.950% range.

Tomorrow's DAILY pivot levels will be S2= 3.859%, S1=3.891%, Pivot=3.921%, R1=3.953%, R2=3.983%.

Today's YIELD high of 3.950% would then be just under tomorrow's DAILY R1 and would have be more bullish on the indexes with a YIELD move above 3.953%. Right now, still dealing with a "zone of YIELD resistance" from WEEKLY pivot of 3.944%-3.953% on a near-term basis.

 
 
  Linda Piazza   3/27/03,  3:05:31 PM
Crude oil prices have been rising along with the equities this afternoon. That's not the relationship we've seen lately.

 
 
  Jonathan Levinson   3/27/03,  2:54:21 PM
What a boring hour this is! The trendline I've been following on today's upleg is now at 1386 COMPX. A bounce higher will imply another push to resistance within this bear flag.

 
 
  Linda Piazza   3/27/03,  2:37:08 PM
The OEX high of the day at 444.14 is just below the 445 level that was resistance on March 19 and 20, before the OEX finally broke through that level on the afternoon of the 20th. The simple 100-dma also lies at 446.38.

 
 
  Jeff Bailey   3/27/03,  2:31:57 PM
10-year YIELD ($TNX.X) 3.929% ... not really "confirming" the fractional gains seen in the major equity indexes at this point. As a Dow bull looking for an 8,050 type of entry point, still going to wait things out a bit here. My entry point might be a bit low considering the way the Dow held that "zone of support" from 8,099-8,120, but will wait a bit here.

 
 
  Jonathan Levinson   3/27/03,  2:16:35 PM
1392 COMPX looks like pretty convincing resistance on my 3 minute chart in the near term. FVX has risen to a -1.7 bp loss on the day, TRINQ .84, TICK.NQ very strong at +499. A break of 1392 will target 1398 then 1401 resistance.

 
 
  Jonathan Levinson   3/27/03,  2:07:20 PM
The COMPX has been rising in a bear flag, and with resistance overhead in the 1390 area, I'm expecting at least a pause if not a failure around that level.

 
 
  Mark Phillips   3/27/03,  2:02:27 PM
Sorry for the absense. My charts have been switching on and off for the past couple hours, and just getting back to business now. A couple of plays on the OIN list are grabbing my attention right here.

NOC $85.08 (+1.39) The Defense sector has been extremly hesitant to give back its bounce off the March 12th lows, and I'm losing faith in our NOC play. After trading in a very tight range for the past few days, the stock is moving to new highs for the week, and looks to challenge the longer-term descending trendline, now at $86.50. Traders that entered on the breakdown last Friday should have stops set at $85.50. I personally wouldn't consider new positions at this point, as the daily Stochastics appear to be turning bullish without having fallen into oversold territory. The other bullish sign is volume, which is already over the ADV and stronger than what we've seen over the past two days.

BLL $56.08 (+0.37) While still struggling with some overhead resistance, I really like the way this stock broke out to new highs and then has spent the past few days consolidating right at those highs, with the intraday lows continuously moving higher. It seems as though we won't get much of a dip on this play, so traders can consider entering the play on any successful bounce above $55. Momentum traders will need to wait for a trade of $57 (just over Tuesday's intraday high) before taking the plunge.

 
 
  Jeff Bailey   3/27/03,  2:02:23 PM
01:00 Update posted at this Link

 
 
  Linda Piazza   3/27/03,  2:01:22 PM
Currently at 2194.30, the Transportation Index (TRAN) attempts to regain the 2200 level and its exponential 100-dma at 2209.42. This moving average lies just below the 50% retracement of both Friday's and Monday's larger-than normal candles. The S&P's and DJI also have not yet been able to retrace 50% of Friday's move after Monday's declines.

 
 
  Linda Piazza   3/27/03,  1:51:22 PM
Volume patterns remain weak, but show improvements in some figures. On the NYSE, decliners now only slightly outnumber advancers, although the Nasdaq still shows a .80 ratio, indicating more decliners. Down volume is 1.35 times up volume on the NYSE and 1.8 times up volume on the Nasdaq. New lows outnumber new highs on the NYSE; the opposite is true on the Nasdaq. Total volume is 697 million shares on the NYSE and 890 million on the Nasdaq.

 
 
  Jonathan Levinson   3/27/03,  1:49:10 PM
The ascending trendline on the COMPX is now at 1381, and didn't get challenged on the pullback.

 
 
  Jonathan Levinson   3/27/03,  1:31:23 PM
1382 COMPX support continues to hold for the time being, but price action so far isn't indicative of a breakout celebration. On the contrary, there's been no loft on this move yet. There's trendline support at 1378, below which I would consider the last long signal a washout for the time being. For what it's worth, I see no bullish mid- to long-term trade setups from current levels. I'm expecting small bounces and chop in the short term, but do not see significant upside from here. Above 1425 COMPX, I might see things differently, but not at current levels.

 
 
  Jeff Bailey   3/27/03,  1:31:14 PM
XM Satellite Radio (XMSR) $5.95 +1% ... volume spike on lower trade to $5.69 after release of earnings during market hours.

For Q4 revenue grew to $9.0 million, compared to $532,000 in Q4 2001. EBITDA loss for quarter was $97.3 million compared to loss of $113 million Q4 2001.

 
 
  Kent Barton   3/27/03,  1:25:29 PM
Best Buy (BBY) 28.41 -1.02: This PremierInvestor long play has come under selling pressure over the past two sessions. Banc of America downgraded the stock on Wednesday morning, saying its risk/reward ratio was not favorable at current levels. Conservative traders should already have closed out long positions when BBY took out its 21-dma. We've given the stock some additional breathing room with a stop at $27.99. Those who are a bit more lenient could force shares to trade below the 50-dma at $27.82.

 
 
  Linda Piazza   3/27/03,  1:09:22 PM
A few days ago, a reader wrote about a possible H&S formation on the 60-minute charts. While I agreed at the time that the formation was probably too malformed to be considered a H&S, today's action perhaps lends it more validity, especially if the OEX continues to be turned back from below its 60-minute 21-pma at 442.41. This morning, the OEX gapped down from the supposed neckline, just below that moving average, and just now rose to retest it. I did note that the "all sessions" version of the 60-minute ES contract shows a somewhat clearer H&S formation, but the pattern is still so malformed as to perhaps not be useful in predicting downside targets while still connoting a somewhat bearish interpretation to the chart pattern.

 
 
  Jonathan Levinson   3/27/03,  1:07:58 PM
FVX is dropping again, -2.4 bps, TRINQ has risen to .87, and the COMPX is below 1383. Longs should be watching their stops and snugging them up- this looks like a possible headfake breakout to the upside.

 
 
  Jeff Bailey   3/27/03,  1:03:55 PM
30-year YIELD ($TYX.X) 4.935% ... just edging green here and now seeing a pickup in selling at the long end. 10-year YIELD ($TNX.X) 3.935% back below the 3.944% level or WEEKLY Pivot.

 
 
  Jeff Bailey   3/27/03,  12:58:57 PM
Forest Labs (FRX) $55.25 +2.3% ... Wow! getting upside alert here and stock really jumped in last 2-minutes.

I had set alert above $55.00 as $55.00 was a relative high back on 12/02/02 and might be a head/shoulder top formation, with the 52-week high of $56.36 (now in play) the "head." I don't think we'd see a h/s top in FRX, but set alert here anyway.

 
 
  Jonathan Levinson   3/27/03,  12:58:17 PM
The COMPX has printed 1383 on this push, and aggressive scalp longs will have entered for a push up to next resistance in the 1390 area. The choppiness today requires tight stops in case this is a headfake, which it might well be. I've been harping on tight stops today, and so far that looks right. FVX is down to 1.7 bps, adding encouragement for intraday bulls.

 
 
  Jeff Bailey   3/27/03,  12:58:04 PM
10-year YIELD ($TNX.X) 3.941% ... traded 3.944% YIELD in past 10-minutes, which was the WEEKLY Pivot where we got "downside YIELD alert" yesterday. Move off the morning low YIELDS has "helped" Dow Industrials (INDU) 8,204 -0.3% to par losses to just 25-points here. YIELD move here is alert to some renewed strength, but I'd expect some Treasury buying here. Will monitor and see.

 
 
  Jeff Bailey   3/27/03,  12:45:33 PM
CBOE Internet Index (INX.X) 104.46 +0.8% .... shows relative strength among technology sectors today, and has been in recent weeks. 106 level would be a spread-triple-top buy signal and further sign of bullishness. Link

One "reason" mentioned for recent sector bullishness, especially among internet portals is that web traffic has really seen an increase in recent weeks due to "war with Iraq" and people using the internet from work locations to gather updates on the war. This is thought to have ad rates improving as companies seek exposure to increased number of "eyeballs" as they call it.

Late yesterday, made mention of United Online (NASDAQ:UNTD) $18.29 -1.5% Link as internet name, which operates NetZero and Juno, where p/f chart broke above bearish resistance trend and currently shows bullish vertical count of $30.50. Ideally, I'd like to get a bullish entry on pullback near $16.00, but partial positions here also good in my opinion.

 
 
  Linda Piazza   3/27/03,  12:41:33 PM
The OEX still trades within that five-minute regression channel. As I type, it's challenging the top of that regression channel. If it is a bear-flag pattern, the OEX should break to the downside before or near the 50% retracement of the previous move. That occurs at 440.70, as shown on the linked chart. If it instead breaks to the upside, with a five-minute close above the top of the channel, or continues within the channel beyond 441, it's probably not a bear-flag channel. Link Note: as I was typing this entry, the OEX moved up exactly to 440.70, but may be pulling back.

 
 
  Jeff Bailey   3/27/03,  12:24:52 PM
11:00 Update posted at this Link

 
 
  Linda Piazza   3/27/03,  12:14:03 PM
The FTSE closed down 64 points at 3729 and the CAC closed down 64.72 points at 2722. Currently, the DAX trades down about 38 points, to 2540.

 
 
  Linda Piazza   3/27/03,  12:06:35 PM
The Russell 2000 declines today, but has bounced from its simple 50-dma at 365.59. The Russell currently trades at 366.55, with a day low of 365.09. If that support fails as the day progresses, next support lies below at the confluence of the 21-dma, an ascending trendline, and historical S/R, all between 360-361.

 
 
  Jonathan Levinson   3/27/03,  11:59:45 AM
Spot gold just bounced up to almost unchanged, and I guess the ramp job I smelled was little more than post traumatic stress built up from the ramps that have occurred during the past two months. The signal remains for new scalp longs above 1382 with a print of 1383, and short below 1368. Scalp longs can be put on for a bounce at 1368-70 as well. In all cases, tight stops are the rule for these plays.

 
 
  Jonathan Levinson   3/27/03,  11:48:44 AM
Gold is selling off, now at 328.50/oz, HUI getting slammed, down 2.35, and I smell a ramp job. If 1378-80 breaks to the upside, it will be confirmed. Scalpers who exited off the early morning long could consider a new long on a break of the 1378-82 s/r zone, on a print of 1383, tight stop just below.

 
 
  Jonathan Levinson   3/27/03,  11:35:35 AM
FVX -4.2 bps, TRINQ neutral at 1.22, QQV +.23 to 38.61, TICK.NQ -125. We have little guidance here, confirming the rangebound action. Scalpers looking for more action need to be very displined- especially in narrow ranges, a bad entry can be lethal. Wait to see the exact setup you want. If it doesn't come, then stay out.

 
 
  Linda Piazza   3/27/03,  11:34:44 AM
Reader A.K. writes to remind us that April will see an altered expiration calendar, due to the holiday calendar. Here's a link to the CBOE 2003 Options Expiration Calendar: Link Thanks, A.K.

 
 
  Jonathan Levinson   3/27/03,  11:31:28 AM
The COMPX is printing a bearflag on the 3 minute candles, and is flirting with a downside breakout here. 25.90-26 QQQ continues to look like good short term support in the event of that downside breakout. Traders would prefer to see higher prices to put on shorts- the COMPX and QQQ is near the middle of a narrow range here.

 
 
  Linda Piazza   3/27/03,  11:21:32 AM
Here's an OEX five-minute chart. Any time you see a tight, upward-slanting regression channel form after a hard fall, put "bear flag pattern" on your radar screen as a possibility. This pictured regression channel may or may not be a bear-flag pattern, but these patterns often form when there's a pause after a sharp fall, before the fall resumes. You won't know whether it's a bear-flag until it's broken one way or the other, but don't let higher highs and higher lows allow you to be too complacent after a sharp fall, especially if the movements are small. If it is a bear-flag pattern, it should be broken to the downside before it retraces half the previous move. Link

 
 
  Mark Phillips   3/27/03,  11:21:16 AM
LEAPS UPDATE Well, we couldn't expect to have another wildly bullish week like we did last week, now could we? So far, all of our open Portfolio plays are holding above their stops, although a few of them have gotten pretty close. Just as a reminder, we make decisions on whether to enter/exit LEAPS plays based on the closing price for the sake of consistency.

I've had several questions over the past couple days about our NEM Watch List play, as some of my readers are wondering if it is reasonable to expect the stock to fall into our target zone of $23.50-24.00. Personally, I think it is in the cards. We've already seen the price of gold relax signficantly, and any stronly positive developments on the war front are likely to pressure the price of the yellow metal even further, perhaps into the $315-320 area. While this will exacerbate the technical damage on the charts, I will view it as a gift of an entry point. Once the war concern fades in the weeks and months ahead, investors will be forced to re-examine the state of the economy and the health of the U.S. Dollar. Both of these should provide more fuel for Gold to continue its upward climb.

NEM is the blue chip of gold stocks and in my opinion is the best vehicle for investors to participate in the long-term bullish move without actually holding physical gold. Since bottoming near $13 in late 2000, NEM has been building a string of higher lows that defines an ascending trendline that falls in the $23.75-24.00 area, depending on how you draw the trendline. With weekly Stochastics bottoming in oversold and attempting to turn north, I think the entry point we're looking for is drawing near. Now it is just a matter of waiting for the right catalyst to give us the entry point we're waiting for.

The persistent volatility in this market should have convinced just about anyone willing to pay attention that it doesn't make sense to chase entries in such a news-driven environment. The seeming irrational reversals that are driven by news make the market a treacherous place to be. Our best defense against this volatility is to lay our a strategy in advance, and then execute that strategy, relying on our analysis and business planto keep us on the road to profits.

 
 
  Jonathan Levinson   3/27/03,  11:19:39 AM
The COMPX is nearing resistance targeted for this scalp. I expect to see a strong pause, more likely a pullback at the 1378-82 congestion zone. Profits can be taken there, or stops can be snugged up to secure profits already on the table.

 
 
  Jeff Bailey   3/27/03,  11:18:03 AM
McKesson (MCK) $24.90 -1.6% ... I'm doing some retracement work for MCK and will show in 11:00 Update. I like retracement from $31.99 to the bearish vertical count of $14, and how the retracement levels give us $25.11, $22.99, $20.87 retracement. For now, would place a stop on 1/2 bearish positions just above $25.11, which is very correlative with trending lower 21-day SMA.

 
 
  Linda Piazza   3/27/03,  11:05:55 AM
Volume patterns today show the expected weakness, with adv/dec ratios at .52 for NYSE-traded issues and .54 for Nasdaq-traded issues. Down volume is 4.3 times up volume on the NYSE and 4.1 times up volume on the Nasdaq. New lows outnumber new highs on the NYSE, but new highs remain slightly ahead on the Nasdaq. Total volume is a light 296 million shares on the NYSE and 423 million on the Nasdaq.

 
 
  Jeff Bailey   3/27/03,  10:54:18 AM
McKesson (MCK) $24.95 -1.42% ... I came close to closing out part of a bearish trade in MCK yesterday and was sitting the offer in the May $25 put options. However, not long after, we got a "YIELD alert" from the 10-year and I decided to pull that trade. Link

Now... I just looked at Dorsey/Wright's sector bullish % data, and now note that yesterday's action saw their healthcare bullish % (BPHEAL) reversed up into "bull confirmed" status (though Dorsey/Wright has the stock under "drug" sector which is "bull alert", I also personally view MCK as "healthcare" type of stock) company profile Link . This now has me UNDERSTANDING that for MCK to join the group, and give a "buy singal" it would have to trade $28.00. With the sector now in "bull confirmed" status, I must also begin to "discount" the bearish triangle pattern and probabilities of Professor Davis, as the SECTOR and the MARKET (SPX) are now in bullish phase. I will now need to get this position from full to a minimum of 1/2 position.

While this stock looks very weak, things have changed a bit (SECTOR/MARKET bullish % have reversed up) since first profile near current levels and I suggest we close out at least 1/2 of bearish positions. Traders that have some offsetting bullish positions will most likely want to keep at least a 1/2 bearish in MCK under current market conditions and uncertainty of war, but renewed internal strength from the sector warrants a bearish trader's attention.

Note: The healthcare bullish % from Dorsey/Wright and Associates was the only sector to show a status change from yesterday's trade.

 
 
  Jonathan Levinson   3/27/03,  10:53:44 AM
The put to call ratio has come down to 1.02, and the COMPX and Qubes are resting near their lows of the day. There's direction apparent here- all my indicators are sliding sideways for the moment.

 
 
  Mark Phillips   3/27/03,  10:51:04 AM
BCR $62.35 (+0.08) With the broad market starting out on a negative note again this morning, our BCR play is actually looking pretty solid. After a dip down near the $61 support level on Tuesday, and then a dip to $61.50 on Wednesday, we're seeing a slightly higher low this morning of $61.62. While certainly not out of the woods yet, the relative strength as compared to the broad market is encouraging. Aggressive traders can still use dips into the $61.50 area to enter the play, while those looking for bullish confirmation will want to wait for a rebound through the $62.90 level (just above yesterday's intraday high).

 
 
  Jeff Bailey   3/27/03,  10:42:05 AM
Point/Figure stats from yesterday. NYSE saw 2 stocks give p/f buy signals compared to 2. stocks giving p/f sell signals. 23 stocks showed a 3-box reversal up on their chart (not necessarily from yesterday's trade along) compared to 20 stocks showing a 3-box reversal lower.

Note: a 3-box reversal is considered a "meaningful" move and worthy of charting.

NASDAQ saw 11 stocks give p/f buy signals compared to 1 stock generating a p/f sell signal. 41 stocks saw a 3-box reversal upward, compared to 33 stocks seeing a 3-box reversal lower.

These type of p/f observations show modestly positive breadth from a p/f charting perspective.

Compare the above to yesterday NYSE breadth of 14 advancers to 18 decliners and NASDAQ's 14 advancers and 17 decliners. New highs vs. new lows for NYSE was 43:29 and NASDAQ was 78:41.

For most part, it would be my view that market internals still holding together.

As I prepare to "buy a pullback entry" I want to monitor the internals. I sometimes think of the MARKET as a doctor's patient. How healthy are the internals before I begin to operate? Are the "vitals" stable or are the internals in such a weak state that it best to continue monitoring the patient until internals stabilize and show enough strenth that I won't lose the patient during the operation.

 
 
  Jonathan Levinson   3/27/03,  10:36:17 AM
The COMPX/QQQ continues to sputter and wheeze, not even close to today's gap resistance. I would not want to be long below 25.90 QQQ.

 
 
  Linda Piazza   3/27/03,  10:35:15 AM
At 436.79, the OEX has been challenging that 437.87 50% retracement of last year's October-to-December move, this time from the bottom. In the last ten minutes, the OEX moved as high as 437.89 before backing off that number, which shows the significance of the retracement level. If the index can sustain a movement through this level, next watch the 438.29 to 440 levels for resistance. (438.29 is a 50% retracement of last week's move, and 439.60 is 50% retracement of the first five-minute move.) I've already posted downside levels to watch, and Steve did also in his update, posted below.

 
 
  Jonathan Levinson   3/27/03,  10:30:53 AM
Perhaps I've been mischaraterizing Al Green and Ben Bernanke all this time, depicting them in their pressed suits and leather wingback chairs. Perhaps the uniform inside the Marriner S. Eccles building is Adidas sweatsuits, hightops, Kangol caps and gold chains, as they determine the daily open market operations and permanent reserve adjustments. Certainly there's been nothing conservative out of the fed's activities of late.

 
 
  Linda Piazza   3/27/03,  10:22:08 AM
The VIX is at 33.48, up 1.32, but still below the 34-35 level that had been the floor of recent moves.

 
 
  Jonathan Levinson   3/27/03,  10:21:15 AM
Not much oomph out of this bounce so far, and it may not come at all, despite that too-high put to call reading. Scalpers will want to keep that stop loss nice and tight in case we get a whoosh down.

 
 
  Jonathan Levinson   3/27/03,  10:18:27 AM
Speaking of fuel, Al Green just added net .75B with a 5.5B overnight repo. Perhaps some of that will cover the anticipated noontime siesta, shiatsu and sorbet with his homie, BoJ governor To Fukui.

 
 
  Jeff Bailey   3/27/03,  10:15:05 AM
Prolonging of war ... was looking at the $25-$100 billion reconstruction estimates for Iraq (09:53) post and was wondering why such a wide estimate. I think reason is the uncertainty of how long the war effort will take.

Three thoughts as it relates to a bullish play in Flour (FLR), which would most likely be a reconstruction play. 1) U.S. must win war, 2) FLR must get a contract, 3) Longer the war drags on, more bombs fall, and more likely greater infrastructure damage (cost of reconstruction rises).

Halliburton (HAL) may not be just a "well fire" play either. It is my belief that the coalition, if successful in overthrow of Saddam Hussein, will fund Iraq occupation and reconstruction with oil field revenue, but HAL may benefit from normal service work, not just putting out fires.

 
 
  Jonathan Levinson   3/27/03,  10:14:12 AM
The put to call ratio just printed 1.35. That should add some fuel to a bounce.

 
 
  Jonathan Levinson   3/27/03,  10:10:38 AM
The anticipated bounce from 1368-70 is right on schedule. I would be unwilling to risk much on this scalp trade, and would keep the stop close by. QQQ 25.90-26.00 looks like stronger support, but again only on a scalp basis. A break below 25.90 will have me targeting 25.40ish.

 
 
  Linda Piazza   3/27/03,  10:08:17 AM
Here are a lot of numbers to absorb, but they show the various levels of support layered beneath the current OEX position. If the OEX continues down, a move below 435.37 brings the index below the March 18 low and below the top of the consolidation band from late January. A 38.2% retracement of the rally off the March 12 low occurs at 434.92, a point near the 435.37 March 18 low, so OEX 435 has double significance. Below that lies the top of the consolidation band from February, with that band's highs near 431.50. Just below that lies the simple 50-dma at 430.81. If you're already in a bearish trade, these are the next levels to watch for a bounce.

 
 
  Jeff Bailey   3/27/03,  9:57:11 AM
Dow Industrials (INDU) 8,120 -1.3% ... getting downside alert here at 8,120, which is 50% retracement of CONVENTIONAL retracement from the October-December range. Our WEEKLY retracement from pivot analysis has 8,099 providing a level of potential support, thus a little "zone of support" from 8,100-8,120 right in here. I'm looking for some "firming" near-term at this level, as 10-year YIELD ($TNX.X) 3.915% up from morning low YIELD of 3.888%.

 
 
  Jonathan Levinson   3/27/03,  9:55:20 AM
The COMPX is hitting new lows at 1373, no doubt about to test the 1368-70 support level. TRINQ 1.93, TICK.NQ -231. Yields are off their lows, FVX -4.5 bps. I expect at least a pause, but more likely a scalpable bounce at the 1368-70 level.

 
 
  Jeff Bailey   3/27/03,  9:53:39 AM
Reconstruction projects to be awarded soon. Yesterday, the New York Times reported that government contract officer plan to give American companies the first contracts to rebuild Iraq, as task that some say could eventually cost $25-$100 billion. Of many, Flour Corp. (NYSE:FLR) $34.55 +0.49% Link was one of the companies invited to bid, as well as Halliburton (NYSE:HAL) $21.06 +1.69% Link and Washington Group (NASDAQ:WGII) $17.17 -1.8% Link .

Disclosure: I've profiled bullish and currently hold a bullish position in FLR.

 
 
  Linda Piazza   3/27/03,  9:43:09 AM
At 314.72, the SOX remains between its simple and exponential 200-dma's. The simple 200-dma lies below at 311.87, with the 50 and 21-dma's layered under that all the way down to 303.70.

 
 
  Jonathan Levinson   3/27/03,  9:40:18 AM
Al Green has a 4.75B overnight repo expiring today. Announcement due out around 10AM.

 
 
  Linda Piazza   3/27/03,  9:39:26 AM
The first five-minute OEX move spanned a high of 441.41 and a low of 437.78 . The 50% retracement lies at 439.60, a level that corresponds with historical S/R. The OEX is now in that 437.87-438.29 range that is so important. 437.87 is the 50% retracement of last year's October-to-December move, and almost exactly that of the August-to-October move, too. A 50% retracement of last week's move would occur at 438.29. These could be potential bounce areas, but failures from here would be meaningful, too. Steve's game plan is posted below. You might review it for other input on key levels to watch.

 
 
  Jonathan Levinson   3/27/03,  9:37:52 AM
Our fade lower dropped all of one point off the opening COMPX print, and a bounce is starting here. 1378-82 is a heavy congestion zone, and I expect it to provide solid resistance here. Traders can consider shorting a failure to break through, but must expect support at 1368. More rangebound trading for the moment, for scalpers only.

 
 
  Jonathan Levinson   3/27/03,  9:32:32 AM
TRINQ 1.32 is neutral. TICK.NQ -418 quite bearish. QQV +.94 to 39.32.

 
 
  Jonathan Levinson   3/27/03,  9:31:11 AM
13 point gap down open to COMPX 1375. Would wait to see a move lower in the first 5 minutes, as resistance is right overhead at 1378.

 
 
  Jonathan Levinson   3/27/03,  9:26:41 AM
Assuming that the COMPX gaps down to support, above 1368, aggressive traders can consider going long the COMPX with a stop tight underneath 1368 to try to game a bounce. I expect 1378 COMPX to provide strong resistance to a bounce off the opening gap, and so traders would be looking to get long at opening support with a stop just underneath, looking to exit with a profit at 1378-80 resistance.

 
 
  Jeff Bailey   3/27/03,  9:25:09 AM
09:00 Update posted at this Link

 
 
  Jonathan Levinson   3/27/03,  9:22:15 AM
We will see a gap down open on the COMPX, with QQQ trading 30 cents lower than its close currently. Below 1368 COMPX I will expect further downside to 1350 and then 1330, above 1401 COMPX I will expect further upside to 1425.

 
 
  Linda Piazza   3/27/03,  9:18:43 AM
Just ahead of the opening of the U.S. markets, the FTSE 100 trades down 69.30 points, the CAC 40 trades down 82.29 points, and the DAX trades down 58.98 points, with the CAC's decline representing a larger proportional loss. The CAC may be particularly hard hit because of the release of a manufacturers' confidence number that fell from 97 to 94. Predictions had been for a drop to 96. In addition, the Air France announcement that it would cut seating capacity and delay delivery of seven new aircraft may be weighing impacting the French market.

 
 
  Jonathan Levinson   3/27/03,  9:09:33 AM
Yields remain weak, unchanged since my 8:32 post. Spot gold is trading at 330.90, up 1.20.

 
 
  Jonathan Levinson   3/27/03,  8:32:53 AM
It's looking like we'll get those volatility bounces discussed in last night's index wrap. Bonds have just opened strong, with treasury yields falling out of bed, FVX -5.3 bps, TNX -4.5 and TYX -3.2 bps. QQQ is down 31 cents from its close, currently 26.25. The US Dollar Index was saved at 100.10, currently trading the 100.30 level. Breaking news: Initial jobless claims fell to 402,000 in latest week, well below expectations. 4Q GDP unrevised at 1.4% annual growth.

 
 
  Linda Piazza   3/27/03,  8:14:36 AM
Note: This information was posted earlier, but was lost when the system was rebooted. I am reposting it, but the European markets have continued lower since the original post.

Good morning. A government report released today surprised investors when it showed that Japanese February retail sales rose a seasonally adjusted 1.9% from the previous month. Economists had predicted a fall of 2.4%. Retail sales did decline 0.2% from a year ago. Retailers such as Seven-Eleven and Ito-Yakado rose. The Nikkei declined more than 20 points in early trading, but managed to close up 16.75 points or 0.2% to 8368.67. Many other Asian markets closed down, however.

Stock-specific news in Asia includes early losses in Samsung Electronics on news that the double-data-rate chip price fell 2.5%. A strategist interviewed for a Bloomberg report noted that "chip prices are falling very fast." Japanese banking group UFJ continued its rise today. This is the bank that announced yesterday that it would create a new company for the express purpose of holding some of its equity assets in order to reduce the effects of stock market fluctuations on the parent company's earnings. Japan's troubled financials have been watched closely, and may prove particularly troublesome in tomorrow's trading. After the bell, UFJ, the fourth-largest banking group in Japan, lowered its forecasts from a profit of 70 billion yen to a loss of 650 billion yen.

In Europe, reinsurers Swiss Re and Munich Re were both in the news, with Swiss Re announcing losses of $65.9 million (U.S.). The losses were in line with expectations and were blamed on equity and other market losses, but the company also cut its dividend. Swiss Re points to improved operating performance and a favorable business outlook as leading to recovery in the next years. Munich Re's losses surprised analysts, however, coming in at 2.2 billion euros, rather than the 1.7 billion-loss that was forecast. Once again, a decline in stock holdings was blamed, building a theme for the day across Asia and Europe.

As happened with British Airways and Deutsche Lufthansa yesterday, Air France today warned that the war will impact profits. It will cut seating capacity and push out the delivery of seven new Airbus SAS aircrafts, originally scheduled for October 2003 and April 2004. As of this writing, all European markets are down, with the FTSE 100 down 48.60, the CAC 40 down 54.36, and the DAX down 35.64.

 
 
  OI Technical Staff   3/27/03,  7:27:01 AM
The Market Monitor Server will be rebooted in 2 minutes. You will need to reconnect your desktop client to continue to receive updates.

 
 
  Linda Piazza   3/27/03,  7:16:33 AM
Good morning. A government report released today surprised investors when it showed that Japanese February retail sales rose a seasonally adjusted 1.9% from the previous month. Economists had predicted a fall of 2.4%. Retail sales did decline 0.2% from a year ago. Retailers such as Seven-Eleven and Ito-Yakado rose. The Nikkei declined more than 20 points in early trading, but managed to close up 16.75 points or 0.2% to 8368.67. Many other Asian markets closed down, however.

Stock-specific news in Asia includes early losses in Samsung Electronics on news that the double-data-rate chip price fell 2.5%. A strategist interviewed for a Bloomberg report noted that "chip prices are falling very fast." Japanese banking group UFJ continued its rise today. This is the bank that announced yesterday that it would create a new company for the express purpose of holding some of its equity assets in order to reduce the effects of stock market fluctuations on the parent company's earnings. Japan's troubled financials have been watched closely, and may prove particularly troublesome in tomorrow's trading. After the bell, UFJ, the fourth-largest banking group in Japan, lowered its forecasts from a profit of 70 billion yen to a loss of 650 billion yen.

In Europe, reinsurers Swiss Re and Munich Re were both in the news, with Swiss Re announcing losses of $65.9 million (U.S.). The losses were in line with expectations and were blamed on equity and other market losses, but the company also cut its dividend. Swiss Re points to improved operating performance and a favorable business outlook as leading to recovery in the next years. Munich Re's losses surprised analysts, however, coming in at 2.2 billion euros, rather than the 1.7 billion-loss that was forecast. Once again, a decline in stock holdings was blamed, building a theme for the day across Asia and Europe.

As happened with British Airways and Duetsche Lufthansa yesterday, Air France today warned that the war will impact profits. It will cut seating capacity and push out the delivery of seven new Airbus SAS aircrafts, originally scheduled for October 2003 and April 2004. As of this writing, all European markets are down, with the FTSE 100 down 48.60, the CAC 40 down 54.36, and the DAX down 35.64.

 
 
  Jonathan Levinson   3/26/03,  11:38:53 PM
The Index Trader Wrap has been posted: Link

 
 
  Vlada Raicevic   3/26/03,  11:38:42 PM
The Futures Trader Wrap has been posted: Link

 
 
  Steven Price   3/26/03,  11:38:35 PM
The Swing Trade Game Plan has been posted: Link

 
 
  Steven Price   3/26/03,  11:37:52 PM
Yesterday's Market Monitor has been archived. You may view it and any previous days here: Link

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