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  Steven Price   4/7/03,  4:03:14 PM
Swing Trade Signals
Ugly looking candles for bulls. After today's reversal, I'm not sure what pullback I'd be looking to buy. A ramp up into the close might have made me more bullish, but we are now below the 200-dmas in the SPX and Dow. I'm seeing similarities to the candles on Dec 2 and Sept 11 and wondering it the bulls are finally tapped out. An intraday sell-off this big is not something you usually see in, as Jeff calls it, a bullllll market!

 
 
  Jonathan Levinson   4/7/03,  3:51:39 PM
hello, mike here, i was at the cboe website and i found that dell, intel,msft, ge and others all had 2:1 or greater call/puts. and now with this end of day selling it is looking more like a blowoff top and a sell the news. things looking bearish???? whats your take----also my daily 5,3,3 stochastics are kissing bearishly, withy hr. macd crossing down,,,,....

Yes indeed. However, note that these indicators are following a big decline off the day highs. I do not think that this is the start of a cyclical bull market, much less a secular one, but note that we made a higher high today on the indices. We need to take out the previous low before today's downmove to fill the gap can be considered as a lower low and more than a mere "correction". I agree with your conclusion, but we need to be aware of the risk of yet another blast up, such as we've been seeing on a regular basis for weeks now.

 
 
  Linda Piazza   4/7/03,  3:41:50 PM
Random observations: The Wilshire 5000 has now dropped below all three levels of resistance I detailed in the linked chart in my 12:57 post: the exponential 200-dma, the extension of the broken H&S neckline, and the descending trendline from early December. At one point today, the Wilshire had moved above two of these and had tested the third, the 200-ema. This looks bearish on the surface, although Monday's actions haven't been too predictive of behavior for the rest of the week for the last couple of weeks.

The OEX fell below the three converging levels of support and now heads straight for the lower line of the rising regression channel, shown on the linked chart in my 11:47 post. If the OEX violates that channel, next support might be found at last week's support at 444, and below that, at the bottom of the megaphone formation, currently at 442, but declining as time progresses. And, finally, this linked weekly OEX chart shows that the OEX today tested (and temporarily failed) the top of the wedge inside the rectangular consolidation pattern. Link

 
 
  Jonathan Levinson   4/7/03,  3:36:44 PM
There is light support approaching on the COMPX in the 1390 area, followed by stronger support at 1380. The bull flag on the 15 minute chart is clearly history with a downside failure. TRINQ .76, TICK.NQ -603, QQV -.95.

 
 
  Linda Piazza   4/7/03,  3:23:54 PM
Reader Question: Friday I [found] an index called Biotech Leaps Index on QCharts. Not sure what it is yet or how it's constructed. So far I'm just watching it, but i notice it is now trading at Friday's lows. Think BBH is too. Not the SOX, though, interestingly. Any thoughts?

Response: The biotechnology index isn't an index that I follow, so I'm not certain of the reason that it underperformed the markets today, as you mentioned happening. I'm not familiar with the composition of the Biotechnology Leaps Index you found, but I can point you to the composition of the BBH, if you don't already have that information. The Amex lists the composition of each of the HOLDRS, with this being the link for the composition of the BBH: Link My initial search for news hasn't turned up anything, other than the fact that Genetech, one of the stocks making up the BBH, reports Wednesday after the bell, and that others will soon report, too. Sorry. As to the semiconductors, I did notice that spot DRAM prices were higher in Asian trading, perhaps boosting the semis despite the downgrades that Steve mentioned in his 1:00 Intraday Update and despite the increasing worries of the effect of Asian factory closings due to SARS. To be frank, the conduct of the semiconductors has puzzled me lately, as the SOX maintains that ascending trendline without an accompanying rise in OBV, an improvement in fundamentals, or other bullish evidence. Is this a case of the worst news being known? However, despite maintaining that ascending trendline, the SOX, like so many other indices, still trades within a wedge, and we'll just have to wait to see the direction of the breakout to have more information.

 
 
  Kent Barton   4/7/03,  3:18:30 PM
The 3:15 update has been posted: Link

 
 
  Jonathan Levinson   4/7/03,  3:15:46 PM
That bull flag is still intact on the 15 minute chart, and 1400 COMPX support has held so far. If this launches, it should be a strong upside move, but a breakdown will target the 1380 COMPX area before finding good support. It will take a break above... you guessed it, 1412, to confirm the bullflag and signal an upside break.

 
 
  Jonathan Levinson   4/7/03,  3:01:59 PM
This is looking like our bull flag has just failed. The TRINQ has risen to .46, which is high for today, FVX +9.9 bps, near or at the low, TICK.NQ -331, QQV -1.1 to 36.08.

 
 
  Steven Price   4/7/03,  2:59:19 PM
Swing Trade Signals
If this rally continues to fade, the 200-dmas in the Dow and SPX may end the day in tact. That would be very surprising and I'm not sure how bullish I'll be if we can't hold those gains. The dollar index fading at 102 looks significant, as well. If we cant break out there, we may have our next top to watch. I also think a move in the TNX back below 4.0% would look more like a short term reversal top than a bullish sign.

 
 
  Linda Piazza   4/7/03,  2:40:24 PM
The OEX had its first 60-minute close (just barely) below the converging levels of support shown in the chart linked in my 11:47 post. Lately, buyers have quickly appeared just below broken support levels, so I'm not drawing too many hasty conclusions from this, especially as the OEX looks to be climbing again as I type. However, a break through these support levels would normally send the OEX down next to test the bottom of the regression channel, currently at 448, but rising throughout the day. However, there's also a sloppy reverse H&S formation on the 60-minute OEX chart--so sloppy that I've hesitated to mention it today. The neckline of that sloppy formation crosses at 451.60. While the formation was so sloppy that I don't think it will have much predictive power as to upside targets, its neckline may provide support should the OEX continue to decline. If the OEX should instead bounce from current levels, it should normally retest the day's highs (not necessarily today, though) and reach toward the top of the regression channel again, currently near 463, but rising.

 
 
  Jonathan Levinson   4/7/03,  2:32:35 PM
Here we are at COMPX 1412, an obvious support level. The bull flag we've been watching intraday has not yet failed, but if it does, we're looking at 1400 COMPX and possibly beyond.

 
 
  Linda Piazza   4/7/03,  2:29:02 PM
The Dow Jones Transportation Index is another index at a key level today. Although in a column of X's, this index is still on a P&F sell signal and is still below its bearish resistance level. However, the simple 200-dma lies just above 2270 and the exponential 200-dma lies just above 2290, so at 2262.59 as I type, the index challenges both important MA's with today's rise. The daily chart shows a potential bullish cup-and-handle formation, with a lip between 2260-2290, right in line with the resistance formed by those MA's. In addition, one version of a long-term descending trendline that's been forming since early 2002 crosses near 2270, also validating the importance of current levels. OBV has been rising with the transports since mid-March, but 5(3)3 stochastics look to be rolling over, with a rollover, if accomplished now, setting up bearish divergence. MACD evidence is inconclusive, as is RSI evidence. The oscillators aren't going to predict what will happen. We'll just have to watch price and hope we can trust what develops.

 
 
  Jonathan Levinson   4/7/03,  2:05:02 PM
I'm watching a low volume ping pong game between QQQ 26.88 and 26.81. The TRINQ is still low, up a bit to .36.. FVX is back to +12.5 bps on the day, roughly in the middle of its day range, while QQV has dropped 1.11 to 35.84. HUI is down 2.82, XAU -1.82. Not much is happening for the moment, in classic flagpole rally mode.

 
 
  Linda Piazza   4/7/03,  2:04:14 PM
Total volume has already reached 908 million shares traded on the NYSE and 965 million on the Nasdaq. Adv/dec ratios are 2.53 on NYSE-traded issues and 2.00 for Nasdaq-traded issues. Up volume is about 6.5 times down volume on the NYSE and 5.6 times down volume on the Nasdaq, numbers that are much more sustainable than this morning's extremes. New highs/new lows ratios remain extreme, however.

 
 
  Steven Price   4/7/03,  1:34:06 PM
Swing Trade Signals
Watching the 5 min chart, we've been consolidating in a pennant for the past couple hours. A move above 8472 looks bullish from here, while a move under 8430 looks bearish. This is a short-term observation only and I am interested in what we see tomorrow based on the action of the past couple of weeks. A powerful reversal could set us up for a move back down this week, while only a mild pullback or rally may signal a run to Jan highs.

 
 
  Linda Piazza   4/7/03,  1:24:19 PM
The FTSE 100 closed up 121.40 points or 3.18% at 3935.80 and the CAC closed up 97.72 points or 3.44% at 2935.68. The FTSE 100 closed almost 30 points off its day high, but more than 100 points above its day low, while the CAC 40 closed more than 50 points below its high of the day, and only 25 points off its low. The DAX currently trades up 13.67 points or 5% at 2786.74. The DAX attempted a push over 2800, but has fallen back each time. The FTSE 100 and CAC never pushed above the 4000 and 3000 levels, respectively, even on an intraday basis.

 
 
  Steven Price   4/7/03,  1:20:02 PM
The 1:00 PM Intraday Update has been posted at this Link

 
 
  Jonathan Levinson   4/7/03,  1:00:55 PM
With regard to Linda's last post, I think we'll see that as program trading continues to increase. Those trading robots tend to make quick and big decisions, and this is why s/r lines have begun to get so sharp- that, and the increased trading of entire indices via ETFs such as QQQ, DJX and SPY.

 
 
  Jonathan Levinson   4/7/03,  12:58:21 PM
There's no clear direction, still. On the one hand, today's fade off the gap up open could be a bull flag on the 3 minute candles. On the other, we've just seen the COMPX challenge upper resistance and fail to hold it for longer than an hour or so. The TRINQ is staying low enough to raise the stakes considerably, in that a break lower means that all that buying pressure has just been wasted. A break higher and all the buying will be confirmed and lead to another launch as shorts cover and longs increase their positions. The weakness so far is bearish, but a move to lower lows needs to start happening, or else we could be seeing a consolidation before the next launch higher.

 
 
  Linda Piazza   4/7/03,  12:57:51 PM
Once a few months ago, one of the writers--perhaps Steve--wrote that the markets were behaving in such a manner that he was always saying that the markets were at key levels. That's the way I've felt lately. As I often do, I looked at the Wilshire 5000 today to determine if there were more clarity on that chart. Guess what I see? The Wilshire 5000 is at a key level. Breakouts above the resistances shown would be bullish. Breakdowns from current levels would be . . . less bullish? Link

 
 
  Linda Piazza   4/7/03,  12:29:45 PM
The OEX saw a brief dip below the 455.10 level that is the 50% retracement of the first hour's move, but is currently above that level, at 455.79. A sustained move below that 50% retracement (an hourly close, perhaps) should see the OEX test the 453.50-454 level. A sustained move below that should send the OEX back to the bottom of the regression channel near 446. On the other hand, successful retests of one of those support levels should send the OEX back up to test the day's highs. I keep writing should because that's what would likely happen most times, but I'm not sure it will happen that way on a Monday during a TV trading environment.

 
 
  Jonathan Levinson   4/7/03,  12:16:24 PM
We should see support here at 1412 COMPX.

 
 
  Jonathan Levinson   4/7/03,  12:03:04 PM
The US Dollar Index has turned to the 100.30 level, but the recent uptrend is still intact. FVX is up a respectable 12 bps, but is well off its earlier highs. The TRINQ is still buried at .32, TICK.NQ -108, QQV -.46 to 36.75. There's very little action now, but I'm relieved to see that they didn't have to wheel out HUI and XAU feet first this morning. Gold is holding at the 322 level. I zoomed out on the HUI and looked at a daily chart, and see a possible head and shoulders with a neckline at the 114 level. I see an earlier one, however, that failed to play out, and on a longer term view, there appears to be a rising triangle pattern, which is bullish. Either way, the 105 to 114 level has to hold for a bullish outcome, and so far it has.

 
 
  Linda Piazza   4/7/03,  11:47:29 AM
Here's a chart detailing the near support for the OEX. These are the first levels to watch to gauge the sustainability of today's move. Link Below these levels lies the 446 bottom of the rising regression channel.

 
 
  Steven Price   4/7/03,  11:45:57 AM
We are getting bounces in oil and gold and the May Crude Oil Futures have again bounced from the 200-dma. While this looks like a pullback to me, rather than a reversal, until that 200-dma is broken decisively in the oil futures, I am skeptical of a move higher. I don't see myself trying to trade today's action, since it is very unpredictable, but I wouldn't be entering bearish positions if I were to trade it. That doesn't mean there won't be some good intraday bearish set-ups for futures traders, but based on the action of the past couple of Monday's I simply don't feel confident picking a direction for a few days at this time.

 
 
  Linda Piazza   4/7/03,  11:18:42 AM
With the current slight pullback, it might be interesting and helpful to look at some likely support levels for the OEX. The OEX has already broken through one potential support level, the March 21 high of 456.36, but looks to be trying to move back above that level again. Another is the 50% retracement of this morning's first hour's big move. That level lies at 455.10. Another lies just below that, near 453.66, a number that comes into play from two factors: the top of the March 24 gap down and also the top of the megaphone formation that the OEX broke through this morning. (That typically bearish formation certainly didn't play out its bearish implications, so now we get to see if the top ascending line provides support.) These are the next levels of support. Let's watch these and see what happens, and we can look at other, lower support levels if necessary.

 
 
  Jonathan Levinson   4/7/03,  11:12:45 AM
If this market doesn't start bouncing soon, bulls are going to have a problem. A peek at the daily COMPX candles shows me a rising wedge. That timeframe is too long to effectively game an entry intraday, but it does reassure me that we're not looking at a new cyclical bull scenario. We have our range in the current flagpole rally, but no clear signals for a great entry. The rally could just drip its way lower, but the risk of one of these upside blasts remains.

 
 
  Jonathan Levinson   4/7/03,  10:58:57 AM
Gold is recovering off its lows, now trading above the 322/oz level. The CRB never really sold off, and HUI and XAU never tested their recent lows.

 
 
  Jonathan Levinson   4/7/03,  10:56:01 AM
Excellent analysis, Steve. Agreed. I would add only that I agree with the last sentence of the reader's post. The COT reports show a high degree of bullishness in large traders' positions, and the more bullish they get, the greater the potential for a drop. The market will seek to reward the smallest number of bets possible, and so I remain dubious that this rally is "the real deal". It's only a question of timing the entry to short it.

 
 
  Steven Price   4/7/03,  10:52:10 AM
Great service and great observation last friday... with regards to a spike into the close(shorts covering due to uncertanity). Now for the ? With this 230ptdow increase and 45pt nasdaq increase... the put/call came in at an avg .60 in the last hour but the vix is only down .75. Could you explain how that is possible? I would have at least expected a test of the 30 level on the VIX. Also something to note is were just one point away from multi year lows on the QQV and the VXN. I've always done well shorting at these levels on the qqv and the vxn. Seems a lot of call buyers with no protection. What do you think?

I think these are all good reasons to doubt the rally. However, when you consider the VIX, we have to realize that we aren't the only ones aware of the fact that the rally is war related and we have been seeing some sudden swings. Implied volatility is basically a measure of supply/demand in the options market and apparently the institutions aren't selling premium as aggressively as they might in a non-news uptrend. Regardless of the p/c ratio, you still need order flow to truly move the VIX. I think everyone is a little hesitant on how long the rally will last and that's why we are seeing that development. I really don't know how the markets will react to the war - I can look back at 1991, but I'm not simply going to use that as a blueprint. I think bullish percents are still telling me to buy the dip (something I've been harping on a lot lately), so I'm not anxious to go short just yet.

 
 
  Jonathan Levinson   4/7/03,  10:46:33 AM
Report: U.S. troops exposed to nerve gas

Dozens of soldiers undergo testing as Army lab detects sarin biotoxin

Link

 
 
  Jim Brown   4/7/03,  10:36:14 AM
ORCL - For those of you that were following the Editors Play on ORCL in this Sunday's newsletter we got an excellent entry for the put play this morning. Shorts covered again and ORCL came to a dead stop at strong resistance of 12.00. There was a bad tick to 12.50 but ignore it. It is starting to roll over and I think this would be an excellent entry. Nothing in Iraq overnight changed anything in Oracle's order book.

 
 
  Jonathan Levinson   4/7/03,  10:34:56 AM
I was poised to go long upon hearing of the popular uprising in Baghdad, but no pop came. Is it just me or is this a bearinh indicator? The last several trading days have been news-driven and, although we rocketed at the open, on weekend news, it seem that this latest intraday news event is a yawner. What do you make of it? Thanks for your efforts.

I can only guess, and won't add an off the cuff opinion to the clutter. But I agree with Steve's (and Jim's weekend wrap) observation that the past several Mondays have printed big moves that got reversed. The problem is that so much is at issue at the current levels. We're above the 200 day EMA and flirting with a breakout above the next level of resistance. I think this move will fail, but if it doesn't, we could be looking at a brand new cyclical bull market in equities. I don't think so, but what I think doesn't matter. It will be much safer to catch a move once this level gets either confirmed or rejected. Trouble has been and continues to be that the bulk of market moves occur in the futures outside of regular market hours, rendering all but the widest stops entirely useless, particularly for option traders given our large leverage.

 
 
  Steven Price   4/7/03,  10:34:43 AM
We have some call plays breaking out to new relative highs and traders who got in on our original entries are faced with the decision of whether to take profits, add to positions, or tighten stops.

Here is my take on a couple of them:

MMM $136.37 (+2.39) We entered here at $131.66, got a pullback just above the stop at $128 and have blasted higher. I can see this one running to $140 on the break above longtime resistance, but would raise my stop just below recent support at $132. More conservative traders can tighten up to $134.89 or take a profit.

UNH $94.30 (+1.97) We entered this play at $90.66, with an ultimate target of $100. It has moved past last week's resistance at $94 and into the "zone" of resistance at $94 and $96. I highlighted small entries over $94 and again over $96.

WFMI $57.80 (+1.17)We entered long at $53.50 and the stock is once again at resistance right around $58. I would not jump in at this level until a break of $58.30.

 
 
  Linda Piazza   4/7/03,  10:30:50 AM
The VIX is down today, but not as much as I would have expected. With prices far above Wednesday's, the VIX is also far above Wednesday's low of 30.49. We'll have to watch what happens the rest of the day.

Volume patterns are all positive, of course, with adv/dec ratios showing a 4.36 for the NYSE-traded issues and 4.52 for the Nasdaq-traded issues. Up volume is 14 times down volume on the NYSE and 13 times down volume on the Nasdaq. New highs/new lows ratios are 72:2 for the NYSE and 99:9 for the Nasdaq. These volume patterns now verge on the extreme, a contrarian indicator. This does not mean that markets will reverse today, necessarily, and I, for one, wouldn't want to step in front of these volume patterns with a short position, but they are a warning sign on a contrarian basis that a pullback may be due. These levels are not sustainable over the long term. If you're in bullish plays, decide on the steps you'll take to protect profit. Total volume is 261 million shares on the NYSE and 347 million on the Nasdaq.

 
 
  Steven Price   4/7/03,  10:25:50 AM
Swing Trade Signals
I just can't pull the trigger on a long as we ran right to the overnight highs and sat. I do think the COMP move back over 1426 looks bullish from here, and I may be watching the train pull away from the station, but unless you were long coming in, it seems jumping on the gap is flirting with getting in just before we pull back. I don't want to be watching all the way back to November/Jan highs, but since the impetus for the run is the war progreess, I am going to be patient (and possibly miss an entry) and wait for the action to settle in. The last couple of Mondays have brought extreme moves with corrections the following day.

 
 
  Linda Piazza   4/7/03,  10:15:45 AM
If the OEX should continue to rise today and through this week, here are some levels to watch for potential resistance: the exponential 200-dma lies at 459.61, the semi-log weekly chart shows the long-term descending trendline crossing in a two-point range (depending on when it's touched) either side of the January high of 475.09, and the July-to-present rectangular trading range has a horizontal top line at 487.50-488. Jonathan mentioned a change in trend. I've been waiting for a move out of that 385-488 trading range before deciding that I'm seeing a change in intermediate trend.

 
 
  Jonathan Levinson   4/7/03,  10:06:34 AM
Equities, bonds and gold are at levels where, in my opinion, the intermediate trend is at issue. If the long anticipated bear market in bonds is actually going to be permitted to occur (contrary to Governor Bernanke's statements), then the market is currenly contemplating an intermediate (I hesitate to say secular) bull market for equities, and bear market for gold. However, gold is holding the 320 level, and perhaps the flight from quality will leave some spillover for precious metals. Similarly, a selloff in treasuries may portend further damage to the US Dollar Index. Difficult to say, but this is a very significant moment for the markets. Do US equities have what it takes to attract foreigh capital once again? I believe that this is what the market is trying to decide this morning.

 
 
  Linda Piazza   4/7/03,  10:04:20 AM
Here are some things I'm watching on the Russell 2000, showing both potential strengths and a potential resistance level (green line): Link The Russell is one of the indices I watch to gauge overall market strength or weakness, as most feel that a rally doesn't have "legs" without the participation of the small caps.

 
 
  Jonathan Levinson   4/7/03,  9:58:13 AM
The fed has just announced a 3.25B 10-day repo, refunding the 2.25B expiring weekend repo for a net add of 1B. I find this very surprising, given that the yields appear to be in blastoff mode, contrary to the fed's current policy objectives. FVX is still +15.4 bps for the day.

 
 
  Steven Price   4/7/03,  9:54:07 AM
Swing Trade Signals
No signs of slowing here, with the SPX, OEX and COMP above the March 21 highs. The Dow is few points shy, but back over 8500.

 
 
  Jonathan Levinson   4/7/03,  9:53:08 AM
I have a rising trendline on my Gann-a-like chart of the QQQs at 27.18-.20. A break above that will look like a true breakout to me.

 
 
  Jonathan Levinson   4/7/03,  9:49:35 AM
That gap fill scenario looked a little too cute earlier at the open, but it's looking less obvious as the COMPX holds 1425 and QQQ holds 27.00. I have trendline resistance at 27.20 QQQ. FVX is now +15.4 bps, showing no sign of reversal. I expect to see a very substantial repo from the fed today, waiting for the 10AM announcement. I don't see how yields can continue to run higher from here without setting off some alarms and sirens inside the Marriner S. Eccles building.

 
 
  Steven Price   4/7/03,  9:48:17 AM
Swing Trade Signals
We got our move over 900 in the SPX, but cautious traders will also watch the TNX, which has gapped up to its 200-dma. I'm not suggesting a short here, but highlighting the risks for those getting in long. The COMP also has bounced but still testing its morning high without a breakout. Here is a chart of the TNX, with 200-dma at 40.76. It is up slightly from when I grabbed the image, now trading 40.70 Link

 
 
  Steven Price   4/7/03,  9:43:22 AM
Swing Trade Signals
SPX high of 899.71 - looks like we have our line in the sand!

 
 
  Jonathan Levinson   4/7/03,  9:42:16 AM
There's support underneath at 1412 COMPX, 1425 resistance, though I would move that level to the high of the day for trading purposes. FVX is up 14.9 bps, not showing any signs of weakness so far. QQQ is holding 27.00.

 
 
  Steven Price   4/7/03,  9:38:55 AM
Swing Trade Signals
Looks like a I spoke too soon. The COMP found sellers after tipping just over 1427 and is back to 1423 - I'd say 1426 is still significant right now. Aggressive bulls can look to get in if the COMP breaks 1430. Jonathan also makes a good point about the downside gap fill.

 
 
  Linda Piazza   4/7/03,  9:37:20 AM
Will the third time be the charm? At 325.80 as I type and having reached a high of 326.93, the SOX appears headed for its third test of its exponential 200-dma at 335.42 since November. It failed at that exponential moving average on those other tests, but let's see how it behaves this time. As is usual lately, oscillators are somewhat inconclusive, but I can't help being concerned by the lack of a bump up in the On-Balance Volume indicator.

 
 
  Jonathan Levinson   4/7/03,  9:37:19 AM
HUI is down 3.58 to 116.96, XAU -1.45 to 63.29.

The COMPX has begun what could be a gap fill with a print below 1425, a widely publicized s/r level. The TRINQ is rising, now .36, TICK.NQ +320 now.

 
 
  Steven Price   4/7/03,  9:36:56 AM
Swing Trade Signals
The COMP move above 1426 is significant and I wouldn't be looking at entering short with that breakthrough. I'm leaning long here, but still concerned about jumping on a news gap.

 
 
  Jonathan Levinson   4/7/03,  9:33:39 AM
QQV has ticked back to 37.08, now down .13.

 
 
  Jonathan Levinson   4/7/03,  9:31:30 AM
Gap up to COMPX 1425, TRINQ .11, QQV +6.24 (not a typo) at 43.45, TICK.NQ +362.

 
 
  Steven Price   4/7/03,  9:28:55 AM
Swing Trade Signals
Traders looking to pick a top can also watch the U.S. Dollar Index (DX00Y), which reached a morning high of 101.81. It failed at 101.71 in Mid-March at 101.71 and 102.00 could be pivotal. An aggressive short entry just below 102.00 with a stop at the DX00Y 102.25-102.50 area could be a bearish strategy worth considering in a "sell the news" scenario.

 
 
  Steven Price   4/7/03,  9:24:37 AM
Jeff Bailey is off today, but I can hear him repeating his last week's mantra of "It's a bullllll market!"

 
 
  Steven Price   4/7/03,  9:22:47 AM
Swing Trade Signals
So much for adding small long positions on a pullback, or as we cross 200-dmas. Those should all be broken quickly on the open and without the opportunity to get in on a 'move' I'll let the gap settle. Aggressive traders can target a momentum trade over March 21 highs, but we will be very extended at that point and I really don't see myself joining in there, unless we pullback, find support and then start higher. Hopefully I'll be in somewhere on a pullback, but this is going to be a very risky day to enter.

 
 
  Linda Piazza   4/7/03,  9:22:01 AM
As the trading day in Europe progresses, major European bourses pull back slightly as they await the opening of U.S. markets, but maintain most of their gains. The FTSE 100 currently trades up 120.40 points or 3.16% to 3934.80, the CAC 40 now trades up 122.43 points or 4.31% to 2960.39, and the DAX trades up 134.64 points or 5.07% to 2788.71. All remain under next round-number trading levels: 4000 for the FTSE 100, 3000 for the CAC 40, and 2800 for the DAX.

 
 
  Jonathan Levinson   4/7/03,  8:32:30 AM
I'm looking at a sea of deep green, with the exception of gold, which is deep red. ND futures were up 40 to 1090 a moment ago, now +39, ES futures +23 to 901.50. QQQ is trading 27.05, up from its close of 26.11. Gold is trading just below 320/oz, and the US Dollar Index is up at 101.55.

If this is a brave new leg for the markets, then the issue I see will be treasury yields. As of this writing, I see TYX +6 bps at 5.019%, TNX +10.1 bps at 4.046 and FVX +1.3 bps at 2.961%. I don't see how yields can be permitted to break out and begin a long term upleg, in light of the Federal Reserve's comments and the state of consumer and corporate borrowing in the US. None of that matters on an intraday basis, but it is essential in determining whether this is a trending move or merely a war news-related pop. We'll see how it unfolds today.

 
 
  Linda Piazza   4/7/03,  7:11:33 AM
Good morning. Buoyed by the weekend incursions into Baghdad made by coalition forces and hopes that the two-day Bank of Japan meeting would result in the purchase of asset-backed commercial paper, the Nikkei opened up 56.69 points. Gold and crude oil fell; the dollar climbed against the yen. The index trimmed its gains to 15 points by midday, but then rose again, closing up 175.86 points or 2.2%, to 8249.98. Other Asian markets climbed, too, casting aside increasing worries over the economic impact of SARS. New Hong Kong SARS cases climbed to 842 this weekend.

Exporters gained, with the notable exception of Fuji Photo Film. On Friday, the company blamed the declining values of its shareholdings in banks for lowered its net profit projections. The stock's price fell 3.1% in today's trading. Cathay Pacific Airways also continued its slide due to the expected impact of SARS on passenger numbers in the region, but by a modest .5%. An increase in spot DRAM prices led to increases in some semi-related stocks, too.

European markets also trade sharply higher, helped by the coalition advances and also by an economic number that surprised to the upside. U.K. February manufacturing production rose 0.3% rather than falling the predicted 0.3%. The three-month number fell 0.2%, however, and also declined 0.7% from a year ago.

Although Cathay Airline stock fell in Asia, European airlines climbed, some more than 10%, as has been the case with Deutsche Lufthansa and KLM this morning. Mergers and acquisitions were in the news, too, with coal-exporter Xstrata Plc agreeing to buy competitor M.I.M. Holdings, and car-part manufacturer Robert Bosche renewing attempts to take over German boiler-maker Buderus.

As of this writing, all European markets except Slovakia's are in the green. The FTSE 100 is up 127.20 points or 3.33% to 3941.60, the CAC 40 is up 136.59 points or 4.81% to 2974.55, and the DAX is up 145.37 points or 5.48% to 2799.44.

 
 
  Jim Brown   4/6/03,  6:02:20 PM
Futures Traders - Tune in to the Futures Monitor during the day for market commentary and futures trading signals from Vlada Raicevic, John Beyer and Jim Brown. To access the Futures monitor click the Futures tab on the desktop monitor.

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  Leigh Stevens   4/6/03,  5:50:23 PM
The Index Trader Wrap has been posted: Link

 
 
  Vlada Raicevic   4/6/03,  5:50:14 PM
The Futures Trader Wrap has been posted: Link

 
 
  Steven Price   4/6/03,  5:50:03 PM
The Swing Trade Game Plan has been posted: Link

 
 
  Steven Price   4/6/03,  5:49:25 PM
Yesterday's Market Monitor has been archived. You may view it and any previous days here: Link

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