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  Jeff Bailey   4/11/03,  8:28:34 PM
QQQ $25.51 ... here is a look at the QQQ and how I look to manage my profiled bullish trade from $25.52 as it relates to the WEEKLY and MONTHLY pivot retracement levels. Link

Not shown on the QQQ chart is the conventional retracement bracket (gets cluttered on the chart) but the 38.2% retracement of $25.34 is also very close to the MONTHLY pivot of $25.39.

If there's "one thing" I'm a bit uncomfortable with as a bull is that I'm losing the WEEKLY S1 support as it falls lower from this week's $25.22 level to $24.81 level, which has $24.81 really tying in with 80.9% retracement from the new WEEKLY pivot retracement. Add to this is the LARGE wedge from trend we've had in place on the QQQ/NDX, where the apex of that wedge seems to provide a "focal point" at the $24.82 level, as if that is some type of "equilibrium" level for the QQQ.

So... with the "selling into strength" that I saw this week (starting on Monday) I as a QQQ bull from today, want to see strength early on Monday, to have a shot at a MAX WEEKLY Target into $26.29-$26.44 by Tuesday or Wednesday.

Equity bulls got some selling in Treasuries that I think they needed in order to free up some cash that can flow towards equities.

The action that I'm seeing from stocks or the equity indexes right now as it relates to the bond market, isn't necessarily an "economic concern" type of trade, but a "what kind of unpleasant surprise am I going to get from earnings" type of trade.

IBM and NVLS report earnings Monday afternoon. IBM is not a QQQ/NDX component, but you can be assured that "Big Blue" will have some impact on the various QQQ/NDX components and "market psychology" in general. NVLS will have greater impact on semiconductor sector and we "know" the impact that the Semis have on the QQQ as it relates to psychology and trade.

  Jeff Bailey   4/11/03,  6:22:25 PM

  Linda Piazza   4/11/03,  3:59:20 PM
I like candlesticks because they're a quick visual reference to what's going on in the markets. A big red or black candle--that's an easy-to-spot bearish candle. A tiny candle with long shadows--the indecision is easy to spot there, too. One candle that's always seemed counterintuitive to me, though, is the shooting star when it occurs at places other than an uptrend. A shooting star is a candle with a long upper shadow and a small real body at the bottom of the day's range. The VIX may be printing such a candle today. When a candle like this occurs after an uptrend, the implication is bearish. That's easy enough to understand: the candle's long upper shadow shows that the higher levels were rejected. However, Nison says that when this candle occurs at a time other than during an uptrend, it doesn't have the same bearish implications. That's the part that seems counterintuitive to me. In fact, this candle at the bottom of a downtrend is now called an inverted hammer, and is a bullish bottom reversal session. It requires confirmation the next session.

  Steven Price   4/11/03,  3:56:19 PM
Swing Trade Signals
The Dow 8200 level is acting like a magnet right now and with yet another bounce from OEX 440 (and yields ending in the green), conservative traders may not want to hold the position over the weekend. However, our third big bearish intraday reversal in the last five days has convinced me to hold the position over the weekend. if I were short more than a 1/4 posiiton, I might consider closing out a portion of it, but I am willing to risk a small position given that price action. The boost in oil futures also figures into that decision.

  Kent Barton   4/11/03,  3:37:20 PM
03:15 Update posted at this Link

  Jeff Bailey   4/11/03,  3:28:01 PM
QQQ $25.47 -1.16% ... I will be holding my 1/2 bullish position in the QQQ over the weekend.

  Jonathan Levinson   4/11/03,  3:19:22 PM
I'm doing something recently out of character, which is attempting to close a position I really like. My well-bought and profitable puts have been the apple of my eye this week, but I see trendline support on the COMPX weekly candles, printing what looks like a pennant. It's a continuation pattern and when it breaks, the COMPX will be getting aggressive corrected, price-wise, in my opinion. But the potential exists for another bounce, and op-ex week is upon us. The bottom could always just drop out as well, with a bearish engulfing just about printed this week on the COMPX. For this reason, I'm putting a big ask up, and will hopefully get filled at my price. If not, I'll take these home- not sure. This is not a recommendation, just a disclosure for those who are interested.

  Steven Price   4/11/03,  3:04:24 PM
Swing Trade Signals
Not sure what caused the spike in the oil futures, but it seems to correlate with this drop in equities. We also got the drop following the close of the bond market, and I am deciding whether to simply close out with a small gain and take advantage of the asset allocation that kept yields in the green now being done for the day.

  Linda Piazza   4/11/03,  3:00:32 PM
Declining VIX and declining OEX: I've received several emails today concerning this incongruity. As Jonathan mentioned earlier today and as I have mentioned in previous posts on other days, the VIX sometimes continues falling even after the OEX has begun falling from its interim peak toward an interim low. Both are moving down in concert. This happened in the middle of March last year, for example, when the VIX didn't reach its interim low until many trading sessions after the OEX reached its interim high and started down again. That wasn't a good thing for equity bulls, as Jonathan mentioned. Sometimes the divergence signals just the opposite: an impending rally. Having the two go down in concert is a divergence from normal behavior, and it will resolve with one or the other of them switching direction. Those who have an overall bearish outlook believe it will resolve with the OEX continuing down and the VIX turning up. Those with an overall bullish outlook believe it will resolve with the VIX continuing down and the OEX turning up. Those of us who are mightily confused by recent market behavior believe the OEX will chop around a while longer, during which time the VIX drops to 26 and then bounces. I lean toward the bearish-to-confused outlook.

  Jonathan Levinson   4/11/03,  2:55:53 PM
The trendline I was watching was broken to the upside, but without any real force, and I'm guessing that bulls are waiting for the more significant or obvious 25.60 s/r zone which has yet to be tested by this upmove. The support we saw arrived right on schedule on a rising trendline connecting the April lows on the 60 minute COMPX candles. Too bad I only found it after the fact.

  Jonathan Levinson   4/11/03,  2:31:13 PM
That was a nail biter, and it isn't even over. The Qubes are back to flirting with the top descending trendline commenced at the spike at 11:10AM EST. That trendline has capped each bounce, and is in the process of attempting to cap this one too. A sustained print above 25.50 will take it out, give or take a few cents for my artistic accuracy. FVX is hanging at a 5.6 bp gain. That 1.25B repo drain is giving me a scapegoat for the treasury selling, but so far it's been correct.

  Jeff Bailey   4/11/03,  2:28:30 PM
10-year YIELD ($TNX.X) 3.989% ... now at afternoon highs. Dow Industrials seemed to find buyers at WEEKLY pivot of 8,180 and trades 8,205. Maybe.... just maybe, some of the cash from Treasury selling starting to take hold.

I must say... for a supply/demand trader, I'm scrouring things looking to make any sense of today's equity trade. Where's the money going? Corporate bonds?

Pacholer High Yield (PHF) $7.88 +0.25% seeing some buying and represents the higher risk "junk bond" market. But who would want this if the economy is going in the tank? Junk bonds are "garbage" under a stand alone scenario of inflation by itself. However, they're "gold" if economic recovery is found.

  Jonathan Levinson   4/11/03,  2:14:17 PM
FVX is starting to rock n roll here, up 6.5 bps now. Either the dealers are squaring up in order to pay Al Green his 1.25B of fiat money for the weekend, or this is telegraphing a move higher in equities. So far, nary a twitch from the COMPX.

  Linda Piazza   4/11/03,  2:05:48 PM
For those at work and not watching television, Rumsfeld speaks now, saying the situation in Iraq is still dangerous.

  Linda Piazza   4/11/03,  1:58:48 PM
Thanks, Steve, for the information on IMCLE. I'm now able to get only one-day's worth of intraday charts, but wow, what a chart! Big red candles on the hourly chart, heading straight down! That three-candle abandoned-baby formation confirmed on March 31 was showing something after all. I still don't have oscillator evidence that would be of much help to the reader, I'm afraid, but I'd still be reluctant to suggest a play on a stock responding to news anyway. It's just not my style.

  Jonathan Levinson   4/11/03,  1:53:28 PM
QQQ is trying to regain the 25.50 level, as the FVX creeps higher and makes me sweat. The selling in bonds, which could be related to Al Green's not-inconsequential 1.25B drain, is failing to confirm weakness in equities. The TRINQ is neutral at 1.03, QQV -.51, and the TICK.NQ -200. The put to call ratio has drifted into the mid .70s, as the bullish speculation continues to edge higher.

  Steven Price   4/11/03,  1:50:53 PM
IMCLE $14.66 -1.82 I am also having issues getting readings on this stock, but this is what I am finding right now. The stock was halted due the SEC tax investigation, but this number is moving, so I assume it is accurate.

  Linda Piazza   4/11/03,  1:49:43 PM
If that H&S formation on the 60-minute OEX charts can be considered a viable H&S formation, the downside target would be between 428-430, depending on whether you draw the neckline across the bottom of the candle shadows or across the bottom of the candle real bodies. (See my 10:45 post for a linked chart showing the formation.) Since the head is so out of proportion, I've been reluctant to label this target as reachable, but you might just put it on your radar screen in case the OEX did continue to fall today or next week. The OEX would need to plunge through several important support levels to reach that 428-430 area, including the important 437.87 level. However, if it did, that 428-430 level is also significant as the trough between March 21 and April 7 peaks. With the target having been fulfilled there and with former support there, that might be a likely place for the OEX to attempt a bounce, should it ever fall that far. Although the April 7 peak was a higher and not an equal high, so that it might not be technically correct to think in terms of a double-top formation in the OEX, they were still relatively close, and a move below the trough would also create a lower low and confirm another shaky and non-classic formation, this time a double top. These are just scenarios to keep in mind if the OEX should continue to fall, and not predictions that it will. Oscillator evidence is too mixed to be of much use in making predictions.

  Linda Piazza   4/11/03,  1:34:48 PM
Reader Question concerning IMCLE: A reader wrote today asking about the viability of a play in Imclone, but I'm unable to obtain up-to-date quotes or charts, either under IMCL or IMCLE, with the E added today because of issues related to SEC reporting. Because I'm not able to get up-to-date prices from any of my various sources or see how that price movement would affect the oscillators, it's impossible to make judgments about what's happening. Usually, however, I tend to stay away from "story" stocks these days, as their trading can be even more unpredictable than that of other stocks. On the 28th, another reader wrote asking about the possibility that Imclone's candles were predicting an abandoned baby pattern, a pattern that was confirmed the following Monday.

  Steven Price   4/11/03,  1:33:03 PM
Swing Trade Signals
The Dow and OEX just took out support from earlier this morning. The SPX has yet to do so, but appears headed in that direction. The TNX is fading back into congestion near the morning lows, and I'd like to see that 39.54 retracement level broken on a 5 min basis. It still has a ways to go, so I'm not breaking out the pom pons for the short position just yet.

  Steven Price   4/11/03,  1:25:25 PM
Good morning Steven: ROOM 64.37 +.77 (1.21%) former OI short play, since Merger with USAI, stock surged, where do you now see resistance to re-enter short/play, two part question, same for USAI 26.91 + .22 (.082%) Thank you Michael

ROOM $64.46 (0.96) The stock is just above resistance in the $63-$64.50 range. While I'd like to try and pick a short entry, it is difficult to do with a deal stock. It will likely move on the developments that either enhance or decrease the likelihood of a deal being completed.

USAI ($27.01 +0.32) has topped out between $28 and $30 and looks to be in an area with a lot of noise right now. There is strong support/former resistance at $25, as well.

I usually stay away from picking stocks that have these types of deals on the table, since institutions have their own valuations set as to where the stocks should trade depending on how the deal works out and that gets in the way of technical trends.

  Steven Price   4/11/03,  1:17:51 PM
Steven, Why do you feel that VIX going lower is bad for the short ? If you plot VIX versus its 200 MA, you will see that it is already as low below the MA as it was on other major tops. It looks to me the low VIX indicates that market should go lower Thanks, Darko

You make a very good point and Mark Phillips has done some work with regard to this relationship. The VIX tends to move with regard to support/resistance levels similar to a stock and the move below recent support at 29% suggests a run at the 26% support level, which would indicate a move higher in stocks. I think both factors are important, but I still think the move below 29% suggests the institutions are not buying premium, which they normally do if they think the market is going down.

  Steven Price   4/11/03,  1:13:35 PM
Swing Trade Signals
The 50% retracement of the Oct-Dec lo-hi range in the TNX is 39.54. We have found support there and now moved above the highs of the last couple of hours. The bounce from the retracement looks bullish for stocks, as does the move above intraday relative highs in the short term.

  Jeff Bailey   4/11/03,  1:12:51 PM
10-year YIELD ($TNX.X) 3.983% ... just traded a YIELD of 3.985%. Let's see if stocks don't bid back a bit here. Dow 8,222, SPX=870.5, OEX=442.19, NDX=1,027, QQQ=$25.53.

  Jeff Bailey   4/11/03,  12:51:09 PM
10-year YIELD ($TNX.X) 3.969% ... Jeff: Why is 3.983% now a level that you're watching for "bullishness" for equities? I don't see this as a level from the matrix or retracement?

I'm just looking at some things in the intra-day charts of this YIELD where this 3.983% keeps showing up. For example... a relative high before a jump high on 04/07 was found on 04/04 at 3.984%. Then, on Monday when stocks reversed lower after early bullishness, YIELD fell into the 3.951%-3.954% area. Early Tuesday, YIELD tried to "rally" but saw buying at 3.983% that morning and stocks got squashed as YIELD sunk back below 3.951%-3.954%.

There seems to be some type of buying for this YIELD (a negative for equities) around that level. As such, I'm looking for ANY type of DIVERGENCE from Monday's trade to signal any type of change in MARKET thoughts.

To really get a move going in equities, I think there has to be some type of "re-thinking" of things from the bond market. There are some signs that bond market is rethinking things, but as noted in this week's commentary, on thing that is a bit concerning to me is the pattern of lower highs in this bond's YIELD.

While I'm more bullish than bearish for the equity indexes, I'm still not overly joyed by the lower highs in YIELD. I want the MARKET to flush the "perceived" safety of Treasuries. Time will tell.

  Mark Phillips   4/11/03,  12:48:46 PM
BBBY $37.63 (+0.50) Interesting action in this OI Call play this morning, as even with the early bullish action, the stock was unable to trade our $38 trigger on the play. Despite 'good' numbers from Retail sales, the Retail index (RLX.X) was unable to crest the $290 level, let alone challenge its highs from Monday, just below $295. This lines up nicely with the observation that BBBY couldn't touch the $38 resistance. While the stock is actually trading pretty well today, showing a fractional gain vs. the RLX currently trading in negative territory, prudence still demands that we wait for that $38 level to be breached to the upside before entering the play.

  Linda Piazza   4/11/03,  12:44:13 PM
Although this morning's climb sent the OEX above its 60-minute 21-pma, all hourly candles have closed below this moving average, currently located at 443.46 and still descending. Bulls want to see an hourly close above this moving average, which hasn't happened since Wednesday morning. Bears want to see hourly closes remain below this MA.

  Jeff Bailey   4/11/03,  12:39:42 PM
May Fed Funds Futures (ff03k) 98.80 ... has fallen from yesterday's 98.84 level and fallen further from April 1 98.92 level.

Current 98.80 has MARKET looking at a Fed Funds rate of 1.2% for May 6th meeting, and that's basically "no change" in Fed policy. This gives an impression that MARKET feels recent economic data may not require any Fed action in May. This can also be attributed to a quicker resolution with war in Iraq.

  Jeff Bailey   4/11/03,  12:27:48 PM
10-year YIELD ($TNX.X) here's an "updated" chart of 10-year on 60-minute time table. A slightly different resonse from the bond market perhaps that what we've seen from stocks. This is slight DIVERGENCE, that I am looking to take advantage of with QQQ bullish profile from 11:55:41. Link

When things get a "little out of whack" it has been my impression that equities are a little out of whack as I believe the bond market is slightly smarter than the stock market.

  Jonathan Levinson   4/11/03,  12:24:40 PM
Great job Jonathan! Love the insights!!! ? on the VIX! We have lost over 13percent on the vix starting this monday but the dow is net negative for the week(as of 12:15). In the last two days the vix has fell upto 8percent while dow only up .03percent. Could you tell me what you take of this action. You feel this is bullish action for the future or you think a lot of complaincy is going on here. I would have at least expected a dow weekly close over 8400 with this low of a VIX reading. HAven't seen a close below 30 in a long time and i gotta tell you... last time it did happen. I had a good feeling going into next week(with reagards to going long) but not this time around.

As with any divergence, it can go either way. However, the last time I saw the VIX diving in tandem with the indices, it was below the 20 level. I was buying puts with everything I had, but it went on much longer than anyone expected. At that time, I was utterly convinced that the bulls were getting set to have their heads handed to them. It was in the spring of last year, and the market obliged me. Bulls and bears will see this divergence differently, and the market is going to have to tell us. But I believe this to be complacency on the part of traders, coincident with large traders going net long, etc. I believe that we're seeing support being removed from the market as traders continue to hustle to get long for the secular bull market or significant rally. For this reason, I believe we've already seen the rally, but that's my own guess, and others will differ.

  Steven Price   4/11/03,  12:19:11 PM
Swing Trade Signals
So far Dow 8200 has been the line in the sand. Until that is broken decisively, I can't conclude that we are not seeing a higher low. Oil futures have broken below the 200-dma and the VIX is heading lower after breaking support at 29%. With those factors working against the short, as well as the bullish percents holding gains, I am beginning to feel like I am swimming against the tide. Working for bears are the big intraday reversals down, which are anything but bullish.

  Jonathan Levinson   4/11/03,  12:13:47 PM
25.60 QQQ continues to hold as resistance, while the FVX chops between a 4 and 5 bp gain on the day. The TRINQ continues to reflect bullish buying pressure, now at .83, ditto the QQV -.17 for the day, TICK.NQ -56 here. The put to call ratio has been headed down, now at .79, and I see little doubt on the part of market participants that yesterday's lows will hold. This, of course, makes me doubt their assumption, but the indicators are not extreme enough to point to an immediate failure. For the moment, it looks like more rangebound trading here.

  Linda Piazza   4/11/03,  12:11:28 PM
The positive volume patterns have deteriorated as the morning progresses. Adv/dec ratios are now a neutral-to-slightly-bearish .92 on NYSE-traded issues and a slightly lower .82 on Nasdaq-traded issues. Up/down volume is roughly equal on the NYSE, with a slightly wider difference of 30 million more shares trading down on the Nasdaq. New highs still outnumber new lows. Volume is 513 million shares on the NYSE and 615 million on the Nasdaq.

  Jonathan Levinson   4/11/03,  11:58:29 AM
Its being Friday, my habitual time for adding a few brush strokes to my ongoing portrait of Al Green, I thought we'd take a look at some his words from an earlier time, when there was still some dew left on our world, and the money machine had yet to be administered its ongoing dose of nitrous oxide. In light of the PPI data this morning, the timing is right, too. From Al Green, in 1966, a quote:

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.


  Jeff Bailey   4/11/03,  11:55:41 AM
QQQ $25.52 -0.97% ... session low has been $25.44, which is 2 cents below today's DAILY S1. This was a pull back level commented on in this morning's 09:00 update. Taking 1/2 bullish position here, stop $25.19, target $26.04.

  Jonathan Levinson   4/11/03,  11:49:10 AM
Hi Jonathan- I know you follow gold, I do too. I want your opinion between HMY and NEM. Which one would you pick if you were to make choice to go long and why? I respect your opinion and have learned from your posts. Thanks.

I don't know the fundamentals of Harmony or Newmont, except that NEM is a widely recognized institutional favorite, while Harmony is smaller lesser known. NEM was touted as the "unhedged" alternative to Barrick, except that I've heard (never bothered to confirm) that it "inherited" some hedges/ gold shorts with an acquisition it made last year. Rather than speculate on individual plays within this sector, I use mutual funds for these long term investments. On the charts, HMY seems to be lagging the recent strength in the HUI, trading on its short term MA's, while NEM is slightly above them. Beyond that, I have no opinion on one over the other. I'd expect NEM to benefit from a move into the sector as it has better "brand" than the lesser known HMY. Link

  Jim Brown   4/11/03,  11:33:59 AM
I agree with Linda. Normally when these errors are discovered we get a strong bounce and that did not happen this morning. This shows that there is an underlying weakness in the market today and the order error only accelerated it.

  Linda Piazza   4/11/03,  11:32:01 AM
Although I wanted all traders to have the information Jim posted, I've often found that when a market drops strongly on an error of this type, it's also displaying vulnerability to further drops, particularly if it doesn't rebound quickly on discovery of the error. It's also interesting that the drop occurred as the OEX, at least, was approaching an important resistance point, with 449.69 being the 38.2% retracement of the October-December move and near historical resistance, too. If an error caused the drop, it was certainly an error that occurred at a suspiciously key level, and if orders were being placed to correct the error, they're certainly not driving the markets up.

  Linda Piazza   4/11/03,  11:26:27 AM
For those of you not reading the Futures Monitor postings, too, Jim included the following post a few moments ago: CNBC is reporting there was an error in the Dow futures this morning that caused the drop. First indications are that somebody entered a sell order for 7000 contracts that should have been 70. They claim there have been orders entered to correct it. This is just a rumor but CNBC is reporting it.

  Jonathan Levinson   4/11/03,  11:25:24 AM
Trying to reconcile the markets with the economic data is perhaps a fool's errand, but the recovery in gold makes sense in light of the upside surprise in the PPI. Whatever the reason, gold is currently above 326/oz, and the HUI is down just .23 now at 124.15, XAU -.08 at 65.77.

QQQ is chugging along below the 25.60 s/r line, having broken sideways out of this morning's steeply descending downtrend. The COMPX is finding support at 1360 even, with stronger support at 1350. FVX is holding steady, now up 4 bps on the day.

  Mark Phillips   4/11/03,  11:20:55 AM
In what has become a consistent theme this week, Defense stocks are under pressure again today, with the DFI index losing another 1% and now below $440. That is playing out nicely with our two bearish Defense plays on the OIN Put list.

LLL $36.20 (-0.28) While not a big loss today, it is interesting to note that the stock really couldn't gain any traction to the upside with the rest of the market. Instead, the stock is being magnetized to the $36 level, which ought to give way later today. Remember our profit target on this play is $35.50, and if touched today, we're recommending harvesting gains and will likely drop coverage over the weekend.

NOC $80.25 (-1.13) Following the big drop yesterday, NOC is losing still more ground, now finding support near $80. Recall from the last trip down the charts, the $80 level provided support for another bounce. While we do have the risk of another bounce from the $79-80 area, the PnF chart tells a different story -- today's trade below $80 generated a Bearish Triangle breakdown and we could see another downward extension on the play.

  Steven Price   4/11/03,  11:13:54 AM
Swing Trade Signals
We got a bounce off Dow 8200, but the COMP is still negative, as are the SPX and OEX. That low in the OEX around 441 looks significnat and underscores the importance of the 437-440 support level I've been highlighting. This moring's action has been awfully tough to decipher and we could see yet more weekend short covering if the pattern of the past three weeks holds out. While the war is almost over, I can see shorts taking in positions ahead of an official announcement. The likelihood is smaller this week, with Baghdad already in U.S. hands and the impact of an announcement not as great, but unless someone can explain everything we've seen this morning, I'm not going to discount the practice of relying on a recent consistent trend.

  Jonathan Levinson   4/11/03,  11:04:07 AM
The fed has drained 1.25B by adding a 2B weekend repo.

  Steven Price   4/11/03,  10:48:59 AM
Swing Trade Signals
The SPX/OEX/COMP all went negative, with the Dow up just 2 points now. USD still up, but this fade looks pretty bad. More aggressive traders can use a stop above the 38.2% retracement that we failed this morning, possibly setting the stop at 8355 to allow for a failure at 8350.

As I typed, the Dow ticked into the red.

  Linda Piazza   4/11/03,  10:45:03 AM
Here's today's update of one of my 60-minute OEX charts (I have a couple, showing different formations on each), showing what I'm watching today. The MA depicted is the 21-pma. Link

  Jonathan Levinson   4/11/03,  10:40:37 AM
FVX is well off its highs, now up 4.4 bps for the day. I'm watching the QQQ try to fight its way back into its downtrend channel from this week, taking a bounce off of the top descending trendline, but it appears to have been a 3 minute bear flag only. The TRINQ at .53 still reflects stong buying pressure, TICK.NQ -170.

  Jeff Bailey   4/11/03,  10:35:36 AM
Wal-Mart (WMT) $53.69 -1.63% ... stock trades lower on trading floor "rumor" that it may be looking to buy BJ's Wholesale (BJ) $13.97 +6.5%.

  Jonathan Levinson   4/11/03,  10:29:46 AM
For a laugh, here's my guess as to what caused that dip. Thanks, Matt: Link

  Linda Piazza   4/11/03,  10:27:43 AM
So far, adv/dec and up/down ratios remain positive--strongly so in the case of up/down volume--but total volume is light, at 193 million shares traded on the NYSE and 283 million on the Nasdaq.

  Steven Price   4/11/03,  10:27:06 AM
Swing Trade Signals
TNX just broke down into this morning's gap. How quickly the bullishness has faded! However, the USD still remains strong and the COMP is starting to bounce.

  Steven Price   4/11/03,  10:19:32 AM
Swing Trade Exit Point Alert - OEX/SPX/DJX/DIA/SPY
Not sure what's behind this fade, but I'm lowering the stop to break even (actually giving it an extra 3 points). Set stops at Dow 8276. The drop continues to extend itself to new mid-day lows and the COMP is now negative on the day. However, if we get another bounce, I'll simply close out and go into the weekend flat.

  Linda Piazza   4/11/03,  10:14:28 AM
In early trading this morning, the OEX climbed back above the 60-minute ascending trendline that began forming as the OEX moved off the March 12 low. The OEX violated that trendline on Wednesday. Now at 444.66 as I type, the OEX now falls back below that trendline again, so that this morning's action can be seen as a retest of that trendline with the outcome perhaps not yet decided. As I surmised earlier, the OEX may be showing a tendency to fall through S/R levels as easily as it pushed through them, although 444 does seem to be holding for the time being. On the 60-minute chart, 5(3)3 stochastics are fully in territory indicating overbought conditions and the fast line hinges down and has barely kissed the slower line. The 60-minute 21(3)3 stochastics just now cycle up out of oversold territory, however. When stochastic evidence is mixed in this manner, trading is sometimes choppy until they synchronize again.

  Steven Price   4/11/03,  10:11:05 AM
Swing Trade Signals
Getting bullish equity confirmation from the May Oil futures (CL03K 27.14 -0.32), USD (100.54 +0.72) and also TNX, but some of those signs are fading. Dow now up only 46 points and 60 points off the high.

  Jonathan Levinson   4/11/03,  9:57:48 AM
Wow! Quick selloff, to below support, now back at 25.94.

  Jeff Bailey   4/11/03,  9:57:39 AM
10-year YIELD ($TNX.X) 4.018% ... morning YIELD high has been 4.033% which would be right into a "zone of YIELD resistance" from the WEEKLY 40.29 to conventional 40.48 area. Tie this in with your indexes from Index Trader wraps.

  Jonathan Levinson   4/11/03,  9:54:42 AM
The expected stage-2 booster blast has yet to arrive, and while I'm bidding on more puts, I'm not chasing them and will likely not get filled. The FVX is up 10.5 bps, just hanging at this level, while the Qubes have begun to sell off after the better than expected Michigan sentiment number. I can assure you that they didn't call and ask for *my* opinion :) Nonetheless, we're seeing no pop and no selloff, just above strong support and in a congestion zone that we lived for many consecutive hours earlier this week.

  Steven Price   4/11/03,  9:53:38 AM
Wow - Consumer Sentiment no longer at ten-year lows - all must be well and good now.

  Mark Phillips   4/11/03,  9:50:39 AM
IGT $79.75 (+0.75) Yes, Jeff. IGT was an OI Call play, but was dropped last night after the bearish comments from UBS on the gambling stocks sent IGT down to the $79 level, generating a Triple Bottom Sell on the PnF. For traders holding open bullish positions, I'd use the rebound this morning as a better exit point, not as an excuse to hold onto the position.

  Jeff Bailey   4/11/03,  9:50:37 AM
Michigan Sentiment 83.2 vs. 79.0 forecast.

  Steven Price   4/11/03,  9:50:19 AM
Swing Trade Signals
So far the morning highs fell short of the 50% retracement of the Oct-Dec range, but we are making another run. That retracement has been resistance for the past seven sessions.

  Jonathan Levinson   4/11/03,  9:49:49 AM
Michigan # is 83.2.

  Jeff Bailey   4/11/03,  9:46:34 AM
Michigan Sentiment due out any minute. April forecast is 79.0 vs. March's previously reported 77.6.

  Jeff Bailey   4/11/03,  9:44:24 AM
S&P Banks Index (BIX.X) 277.77 +1.39%

  Steven Price   4/11/03,  9:43:57 AM
Jeff, IGT was an OI call play that suffered along with other gaming stocks on an Illinois proposal to raise gaming taxes. Illionois has a new governor and with the Illinois congressional session not over until May 23, we decided to punt on this one, rather than hope for a vote in our favor.

  Linda Piazza   4/11/03,  9:43:28 AM
At 306.41, the SOX is currently just above the simple 200-dma at 306.20, and just below the simple 100-dma at 307.68. Just ahead is the 21-dma at 314.70.

  Steven Price   4/11/03,  9:40:03 AM
Swing Trade Signals
All but the aggressive traders I talked about leaving stops in place should be stopped out on the opening spike. So far no signs of weakness, with the second 5 min candle barely pausing for a breath before moving higher.

  Jeff Bailey   4/11/03,  9:40:02 AM
Intl. Game Tech (IGT) $79.51 +0.73% ... All prepared to bail on IGT this am and we're greeted with it being up...??? Are the technicals still holding?

I'm not sure what IGT is about. Is this an OI play? I don't write or pick OI plays.

If bearish, I see IGT testing a flattening out 50-day SMA. If this was a target then close it out.

  Linda Piazza   4/11/03,  9:38:44 AM
Historical resistance, retracement levels, the 60-minute 21-pma, and the neckline of a rough H&S formation presented no difficulties at all for the OEX this morning, as it moved handily above the 444-445 resistance. That's a good level to watch for support now if the OEX should pull back after the release of the next economic number, although it's a bit troubling the way indices move either direction across these S/R areas without pausing. It becomes difficult to pinpoint likely support or resistance levels. If the OEX can push past the level as if it had no significance, perhaps it can fall through it the same way.

  Jeff Bailey   4/11/03,  9:33:22 AM
S&P Banks Index (BIX.X) 275.00 +0.27%

  Jonathan Levinson   4/11/03,  9:33:19 AM
The TRINQ is down to .20, QQV +.51, TICK.NQ +180 with the COMPX trading 1381, trying to break away fromt the 1380 s/r zone.

  Linda Piazza   4/11/03,  9:28:16 AM
European markets have extended their gains, with the FTSE 100 now up 54.50 points or 1.43%, to 3857.80; the CAC 40 up 74.36 points or 2.65%, to 2882.94; and the DAX up 88.92 points or 3.30%, to 2786.02. The FTSE 100 and CAC 40 currently approach a descending trendline that has been in place all this week. The DAX's five-day chart has been choppier, without discernable patterns to watch until now, although Wednesday's low and yesterday's low were close enough in values to set up the possibility of a short-term double-bottom pattern. That would be confirmed only if the DAX can also move above Wednesday's intraday high of 2824.99. This would be a minor double-bottom pattern, however, formed over a two-day period only, and may not have intermediate-term or long-term implications.

  Jeff Bailey   4/11/03,  9:21:19 AM
09:00 Update posted at this Link

  Steven Price   4/11/03,  9:21:12 AM
Swing Trade Signals
Back where we started. The 1/4 short position isn't looking as good this morning and if this bounce does hold, then it may turn out to have been a pullback to support and then a mive higher. My stop is set at 8415, but we are seeing strength across the board in the dollar, the futures and the yields. The TNX has a descending 200-dma that it has failed on the last two attempts now sitting at 40.59 and because of that factor, I will leave my stop in place. However, I think anyone except aggressive traders could lower it to breakeven at Dow 8273 (where they would likely be stopped out on the open) and that would be prudent, as well.

  Jeff Bailey   4/11/03,  8:55:44 AM
NASDAQ-100 Tracking Stock (QQQ) chart that will be in this morning's 09:00 Update. Link

QQQ at $26.03 here.

  Jonathan Levinson   4/11/03,  8:45:09 AM
US retail sales +2.1% in March. PPI +1.5%, core +.7% led by energy and autos. March retail sales rose an adjusted 2.1%. QQQ now trading 26.06, up 30 cents. FVX +9.8 bps, TNX +8.8 and TYX +5.8 bps. This is looking to be a strong open.

  Jonathan Levinson   4/11/03,  8:22:41 AM
GE slips after announcing that it earned 32 cents a share on revenue of $30.3 billion during the quarter ending March, versus consensus analyst estimates of 32 cents and $30.5 billion.

  Jonathan Levinson   4/11/03,  8:16:18 AM
QQQ is right at resistance, 25.92, with ND futures +7 and ES futures +4.50. Gold is down 1.60 at 25.00. Economic data for this morning:

8:30 am: Core PPI for March, prior -0.5%, consensus 0.0%

8:30 am: PPI for March, prior 1.0%, consensus 0.3%

8:30 am: Retail Sales for March, prior -1.6%, consensus 0.6%

8:30 am: Retail Sales ex-auto for March, prior -1.0%, consensus 0.4%

9:45 am: Mich Sentiment-Prel for April, prior 77.6, consensus 79.0

  Linda Piazza   4/11/03,  7:18:33 AM
Good morning. Although South Korea's Kospi closed up, managing a second straight week of gains, the Nikkei opened down a modest 10.88 points in Friday's trading and continued falling to close down 163 points. The closing level was 7816.49, which I believe is a new 52-week low, lower than the March 19 intraday low of 7824.82.

At least a third of the Kospi's recent gains were due to gains in financial stocks, one source reported. The government recently asked investment trust companies to roll over debt owed by financial institutions. In Japan, however, a different government policy related to the handling of pension-fund shortfalls has been responsible for some of the declines. The policy allows companies to return part of their pension funds to the government to avoid taking the losses, but some claim that the net result is institutional selling of blue-chip stocks. In addition, real-estate figures show Japane's office vacancy rates to be 8.2%, a number that harks back to the high vacancy rates in the late 1980's. Exporters Toyota and Sony also dropped, with Toyota reportedly planning to export South African-made subcompact cars to Europe.

While Asian bourses were mixed, European markets are mostly higher. Automakers are rising after the release of a number showing March car registrations in Western European up 2% from last year. Airlines rebounded after having been pummeled in recent trading. Even Telefonica rose after announcing that it would cut 10,000-15,000 jobs. Vivendi Universal rose amid speculation that Apple Computer would buy Universal Music Group, a Vivendi subsidiary. As of this writing, the FTSE 100 was up 25 points or .66%, to 3828.30; the CAC 40 was up 42.25 points or 1.50%, to 2850.83; and the DAX was up 57.86 points or 2.15%, to 2754.96.

  Jeff Bailey   4/10/03,  11:11:07 PM
The Index Trader Wrap has been posted: Link

  Vlada Raicevic   4/10/03,  11:10:58 PM
The Futures Trader Wrap has been posted: Link

  Steven Price   4/10/03,  11:10:51 PM
The Swing Trade Game Plan has been posted: Link

  Steven Price   4/10/03,  11:10:00 PM
Yesterday's Market Monitor has been archived. You may view it and any previous days here: Link

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