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  Linda Piazza   6/23/200,  4:17:30 PM
For reference, the DAX closed down 52.59 points or 1.62%, at 3186.39.

  Jeff Bailey   6/23/200,  4:06:06 PM
QQQ $29.82 -1.84% .... looks to close above its WEEKLY S1 of $29.79. NDX closed 1,200.31, which was just below WEEKLY S1. Tomorrow's DAILY Pivot is 1,203.91. As tempted as I would be to trade long the QQQ here into the close, will wait and see how things open in the morning.

  Linda Piazza   6/23/200,  3:57:21 PM
The OEX did exceed the last five-minute high, although the move has been unimpressive so far. Thirty-minute and 60-minute oscillators hint at, but don't promise of course, some upside tomorrow morning. Much may depend on the performance of the Asian and European markets, but the OEX, in particular, ends the day right at its 21-dma, a possible bounce point unless these last few minutes send the OEX down decisively.

  Jonathan Levinson   6/23/200,  3:48:37 PM
Strong buy signals on the short cycle stochastics here, taking another run at the upper channel resistance of 1200 NQ 980 ES.

  Jeff Bailey   6/23/200,  3:48:00 PM
QQQ $29.78 -1.96% .... trying to bid back above WEEKLY S1 of $29.79 here.

  Linda Piazza   6/23/200,  3:36:46 PM
Either the end-of-day orders are slanting strongly to the buy side or else someone is front-running that possibility.

  Linda Piazza   6/23/200,  3:23:10 PM
There has been a bounce from the OEX 21-dma (daily chart), but that bounce has not yet broken the pattern of descending highs seen all day on the five-minute chart. We should soon begin seeing how the closing orders balance/imbalance might affect OEX prices, too.

  Jonathan Levinson   6/23/200,  3:20:56 PM
Still no followthrough in equities, just a slight downtick in the overall range.

  Jonathan Levinson   6/23/200,  3:17:02 PM
The US Dollar Index bounced just above 93.90, currently just above 94.00. August gold is off its lows, down 2.50 to 354.20. HUI is still down 5.67, XAU -2.54.

  Linda Piazza   6/23/200,  3:10:08 PM
The OEX currently trades near the 20-dma that marks the midline average of its Bollinger bands on the daily chart and just below its 21-dma at 463.65. This is the point from which it might bounce back up to the top Bollinger band or descend toward the bottom Bollinger band. A strong index or equity will find support here, while a weaker index will retrace to the bottom BB. Often when an index or equity's prices have pierced the upper BB, as the OEX's did, prices will fall all the way back to the lower BB, but that's not a given.

  Jonathan Levinson   6/23/200,  3:07:04 PM
We saw some new lows but, yet again, no followthrough. The 5 hour stochastics are still on their sell signals, and the MacD is following now. Yields have closed at their lows of the day, and the TRIN.NQ is near its high, currently 1.75. Remember those TRIN.NQ readings above 4 and 5? Me too, but it's been a long time. Given the day's range, I'd be thinking bullish above 980 ES/ 1200 NQ, confirmation with a print at 982 ES / 1205 NQ, and bearish below that.

  Jeff Bailey   6/23/200,  2:58:20 PM
Intl. Game Tech (IGT) $97.25 +1.8% ... exhibiting relative strength today. May benefit from lack of "profit taking" as bulls look for psychological trade at $100.00.

  Jonathan Levinson   6/23/200,  2:52:42 PM
New lows of the day for NQ, ES, INTC.

  Linda Piazza   6/23/200,  2:51:18 PM
The previous OEX low of the day has now been violated. Let's see if it holds, as we're still arguably testing that level. Those currently in bearish plays are doing okay and might breathe easier, but should be aware of bounce potential here. Those in bullish plays should be examining their stops. The OEX has some slight support below at 492, 490 might be considered psychological support if nothing else, and then there's the strong 487-488 support level that marked the top of the long-term OEX trading range. The bottom support of the OEX ascending channel on the daily chart comes in somewhere around there, too. With the OEX currently below that ascending channel's midline support, it might be more likely than not that the OEX would at least test the bottom of the channel. Below those levels lie the 484.56 level that marks a 25% retracement of the March to June rally. A 38.2% retracement would take the OEX down to 469.72.

  Jonathan Levinson   6/23/200,  2:50:29 PM
So far, the oscillators are on solid sell signals for ES, NQ and QQQ, with zero followthrough so far. New low of the day on INTC, with NQ and ES just above their lows of the day.

  Jonathan Levinson   6/23/200,  2:42:41 PM
Oscillator sell signals at last on the ES, NQ and QQQ. We'll see if it does more than going sideways.

  Jonathan Levinson   6/23/200,  2:41:55 PM
Yields have just gone el tanko to new lows as treasuries head for the session close, FVX -8.4 bps, TNX -7.6 and TYX -5.7 bps.

  Linda Piazza   6/23/200,  2:41:06 PM
The OEX heads back down to test that 494.30 day's low again.

  Linda Piazza   6/23/200,  2:38:06 PM
Don't you wish we had a midday break in trading, the way the Nikkei does? To me, that appears a much more sane way to trade. We could have lunch or go workout and think about our trades away from the market action, then come back better prepared for the afternoon session.

  Jeff Bailey   6/23/200,  2:37:13 PM
BancTrust Financial (BTFG) $17.25 +16.9% Link ... was stock mentioned this Friday evening on Louis Rukeiser program by analyst as stock for bulls to own next couple of weeks on Russell 2000 adjustments for quarter-end as it was being added to Russell 2000 and small cap fund managers tracking the Russell 2000 would be buying on rebalancing.

Other names she mentioned were Taylor Capital (TAYC) $21.45 +3.6% Link and Horizon Financial (HRZB) $17.25 +15.69% Link .

(Note: Not seeing any option chains on these three names)

  Linda Piazza   6/23/200,  2:35:17 PM
The last dip came within cents of the previous OEX 494.30 low of the day, but did not violate it. The OEX then bounced $0.46 within a one-minute period. Without a penetration of that day's low, the OEX remains susceptible to a bounce, although volume patterns certainly do not predict a bounce.

  Jonathan Levinson   6/23/200,  2:33:50 PM
Still no sell signals on teh oscillators.

  Jeff Bailey   6/23/200,  2:27:57 PM
02:00 Internals ...

NYSE 5548.30 -1.47% ... Vol. 845m A/D 7:24 NH/NL 48:7

NASDAQ 1,607 -2.25% ... Vol. 1.14b A/D 7:23 NH/NL 74:7

Current NH/NL for NYSE and NASDAQ have daily ratios at 87.3% and 91.4%, which are lowest levels seen in June. Would have the 10-day averages we're plotting on 2% box size chart slipping to 97.0% and 96.6% resepctively.

Largest number of new 52-week lows for NYSE and NASDAQ in June have been 10 and 13 respectively. Current observation is that leadership from the 52-week highs camp starting to give in a bit to the new lows, and part of my thinking that any type of "rally on the Fed" back near 1,000-1,006 for SPX might be a "sucker rally" type of move.

  Jonathan Levinson   6/23/200,  2:27:35 PM
This latest downmove, slight though it is, has begun to turn the oscillators back down. Lettuce hope.

  Jonathan Levinson   6/23/200,  2:22:01 PM
Put to call ratio still .66, index pcr 1.40, equity pcr .51.

  Jonathan Levinson   6/23/200,  2:09:48 PM
Liquidity theories aside, the short cycle intraday oscillators have been in an upphase since 11AM EST, and price has moved sideways. The price action, or lack thereof, suggests to me that we might see one brief upside fakeout to end the cycle, and then the beginning of the downphase. Just a guess so far.

  Jonathan Levinson   6/23/200,  2:06:12 PM
If you think this is boring, try to imagine R.N. Elliott, in his hospital bed for years, with nothing but paper charts. Not even the pretty colors of a laptop screen.

FVX has broken to marginal new lows, -7.2 bps, and the increase in buying of treasuries could suggest further weakness for stocks, but more likely, it signals additional liquidity entering the market. If I'm right, the break should be to the upside as liquidity should buoy stocks and bonds together. We'll see.

  Jonathan Levinson   6/23/200,  2:03:17 PM

  Jeff Bailey   6/23/200,  2:02:51 PM
Sirius Satellite Radio (SIRI) $1.77 +2.89% ... correction to my 12:15:09 post, which has been corrected. SIRI announced it had reached its 100,000 subscribe rate, not 1,000,000 as previously reported (error from news wire was 1,000,000).

  Linda Piazza   6/23/200,  2:00:15 PM
We don't yet have as much information as I would have liked to have had. There was no new OEX low, which could be considered a plus for the bulls. However, the OEX traded right back into that 495-496 congestion band. Until it breaks above that congestion zone and then breaks above the 50% retracement of today's drop, at about 498.20, it's dangerous to draw too many bullish conclusions. Above 498, the OEX faces multiple layers of resistance, too.

  Linda Piazza   6/23/200,  1:44:09 PM
Here comes the 1:45 ET push (beginning at 1:38 today), and it looks as if today's test will be of support. As dramatic as that 1:38 candle might appear, a drop that stops short of testing the previous day's low might be considered a successful test of support, and it's perhaps possible the OEX would then rise. We'll have to see what happens in the next few minutes and where the drop might stop. For reference, the current OEX low for the day is 494.30.

  Linda Piazza   6/23/200,  1:34:58 PM
The dreaded 1:45 ET time approaches (or perhaps 1:35 ET, as lately the big push has come a bit earlier). This is the time when support or resistance is tested, often running stops before a market reverses. Perhaps today that push won't be so unwelcome, though, as it will at least provide some movement and give us information about how strong next support or resistance might be. We hope.

  Jonathan Levinson   6/23/200,  1:29:46 PM

  Linda Piazza   6/23/200,  1:29:25 PM
Jonathan brings up a good point when he mentions finding something to say when the markets are trading in a tight range. When that happens, I tend to study all the charts, looking for some kind of formation or indicator that will give a clue as to next direction. Sometimes there isn't one or the ones that set up prove to be meaningless. However, with that said and with the caution that the formation might be meaningless, the OEX five-minute chart showed the OEX breaking out of a neutral triangle that had formed at the bottom of today's range. The minimum upside target would bring the OEX only up to next resistance at 497 at the most, however, but it might be useful to watch if the OEX does fulfill that upside target. At least it would give us something to do!

  Jonathan Levinson   6/23/200,  1:17:37 PM
The put to cal ratio is flat at .66 again, index pcr 1.41 and equity pcr .50. QQV is up .89, VXN down .22, VIX 1.49.

  Jonathan Levinson   6/23/200,  1:13:55 PM
I'm amazed that we can collectively find so much to say about a 1 point range for nearly two hours. August gold is down 4 to 352.70. HUI is down a whopping 5.53 to 148.19, XAU -2.28 to 78.37.

  Jonathan Levinson   6/23/200,  1:08:05 PM
Enjoy your insights... I think this might be a great time to buy the NDX and the spx calls. A friend of mine at the CBOE is seeing some good shift out of SPX put's and seeing some call buying while this market is going down. Also he made a good point, with only a week until the end of JUNE; mutual funds will not let this market fall. I think there are still too much bearish put buying already in the QQQ's (strike 30 and below compared to the calls); SPX put/call ratio is at the highest this year 163put's to 100 calls. I think we have one last leg up into the 1020 range until we fall. BUYING MORE NDX CALLS HERE. Support at 1600 and 975 on SPX.

Thanks, Vick!

  Linda Piazza   6/23/200,  1:05:41 PM
The OEX one-minute chart shows a series of lower highs and lower lows. On the surface, this doesn't appear to be a bull flag pattern, however. First, the higher highs and higher lows don't appear to be trading tightly in relationship to the previous (up) move. Second, they've now retraced more than half the move from the day's low to the 12:26 one-minute high. A bear or bull flag should see a breakdown or a breakout before it retraces more than half the previous movement. However, bull flag or not, it's still possible to see the OEX move up and break out to the upside, as it has so far refused to penetrate the day's low again, either.

  Jonathan Levinson   6/23/200,  1:04:25 PM
Yields are back to their lows of the day, -6.9 bps, TNX -5.7 bps and TYX -3.5. TRIN.NQ -157, TICK.NQ -214. We're back at the bearish ends of today's range. A move below the lows should get some fireworks started. Until then, more rangebound action.

  Linda Piazza   6/23/200,  12:51:20 PM
The European markets turned down further after our markets opened. The FTSE 100 closed down 72.20 points or 1.74%, at 4087.90; and the CAC 40 closed down 70.87 points or 2.22%, at 3119.24. Currently, the DAX trades down 55.74 points or 1.72%, at 3183.24.

  Jonathan Levinson   6/23/200,  12:47:00 PM
My gut is swinging far wider than the market here- still a very narrow range just above the day lows.

  Jonathan Levinson   6/23/200,  12:35:47 PM
Put to call ratio edges up to .66. Treasury yields are off their lows by a bit, FVX -5.8 bps, TNX -4 and TYX -2 bps. TRIN.NQ 1.45, TICK.NQ -225, QQV 1.05. The up-phase here has barely been sideways, just a pause on the way down so far. It's feeling increasingly bearish as this phase progresses. If this is the upphase, the down should be interesting.

  Linda Piazza   6/23/200,  12:24:31 PM
As of a few minutes ago, decliners still outpaced advancers by more than 3 to 1. Down volume was 10 times up volume on the NYSE and a much more modest 5 times up volume on the Nasdaq. Total volume was 614 million on the NYSE and 893 million on the Nasdaq. However, if the indices continue to rise, those volume patterns may change as more buyers step into the market.

  Jonathan Levinson   6/23/200,  12:23:40 PM
The put to call ratio is still .65, with the index pcr down to 1.38 and the equity pcr up to .49.

  Jonathan Levinson   6/23/200,  12:21:29 PM
ES and NQ are back to former support. Will it act as resistance on a test from below? The TRIN.NQ never made it up to 2, and the TICK.NQ is back to flat. There's little commitment to either side so far, just a drift happening just above the lows. It feels like a flagpole rally in reverse, with a narrow range trading after a large surprise move. However, the move hasn't been that large or explosive.

  Jeff Bailey   6/23/200,  12:15:09 PM
Sirius Satellite Radio (SIRI) $1.80 +4.6% ... most actively traded stock at 65 million shares (not unusual of late). Company announced it has reached the 100,000 subscriber mark. Link

  Linda Piazza   6/23/200,  12:14:40 PM
On the retest of the bear flag, the OEX moved back into the flag formation and has now been stopped at the top of that formation. Moving back above the violated support was a first bullish sign. Let's see if any others follow.

  Jonathan Levinson   6/23/200,  12:11:22 PM
Note that NQ and QQQ are down significantly more than ES and YM. It looks like the NDX components are resuming their leadership positions.

  Jeff Bailey   6/23/200,  12:11:20 PM
Lucent (LU) 1.95 -5.79% .... falls back below its rising intermediate-term 50-day SMA of $2.05 for first times since breaking above at $1.56 on April 21. May hint that telecom equipment speculators a little less aggressive now.

  Linda Piazza   6/23/200,  12:05:55 PM
The OEX is breaking down out of the latest bear-flag pattern, resuming the downside movement. These bear flags today are so small that they're visible only on a one-minute chart. As usual, we should expect a retest of the violated bear flag, with the bottom of that formation at about 494.60, but rising, of course, since a bear flag is a rising formation.

  Jeff Bailey   6/23/200,  12:04:12 PM
QQQ $29.72 -1.56% .... looks like this may be the first index to potentially give a "sell signal" from our unconventional technique of box size used in the Thursday 06/12/03 Index Wrap if trade at $29.40 were found. Session low has been $29.67. I'm showing "bad ticks" at $29.08. Here's our unconventional $0.35 box size chart where we were looking for "finite" level. Link

With continued weakness found in biotechs and BTK.X 431.91 -3.9% after the biotech bullish % (BPBIOM) reversed into "bear alert" status, I'm thinking recent reverse lower in NASDAQ-100 Bullish % ($BPNDX) Link to "bull correction" at such high level of bullishness, will have QQQ trading $29.40 this week.

  Jonathan Levinson   6/23/200,  12:03:45 PM
The TRINQ is up to 1.53, TICK.NQ -232. If anyone doubted that opex week sees generalized manipulation of prices, today's action should be a good case in point- prices held almost net unchanged last week, and today we see a widespread selloff. The session is still young, but so far, there's a distinct lack of buyers. The oversold oscillator readings and buy signals have yielded no results in price so far.

  Linda Piazza   6/23/200,  12:00:48 PM
Marvel (MVL): Reader J.K. contributes the following information about Marvel, in response to the 10:59 post. I heard someone on CNBC talking this morning about Marvel. They had two points. Historically, the stock declines after the weekend of a new release (buy the rumor, sell the news). Also, the post Hulk liscensing outlook (where Marvel is generating substantial revenues) is cloudy and relatively distant.

  Linda Piazza   6/23/200,  11:55:36 AM
Reader Question: I am continuously learning. Does a bear flag mean a signal of a possible down movement? Vice versa for the bull flag I assume. A breakdown of a bear flag mean a possible up movement, or should I say aborting the bear flag signal?

Response: I'm so glad you asked this question as I'm sure other readers out there have the same question. A bear flag usually forms after a sharp fall. The market then begins moving up in a tight series of higher highs and higher lows. That looks positive if you're watching it on a chart, right? Higher highs and higher lows is a good thing. Not necessarily. Sometimes wise market participants are selling into each miniature rally. When the sellers overwhelm the buyers again, the fall resumes and the price falls out of the bear flag. Prices often rise to retest the broken support, as they often do any time support is broken.

Different writers may say things a little differently, but usually if prices break out to the upside instead, as sometimes does happen, I'll say it in just those words and will usually say that the bear-flag pattern apparently wasn't valid. If I'm using the word breakdown, I usually mean that prices break to the downside out of a formation. Here's a chart depicting a bear flag pattern from Friday, as it was bigger and easier to see than this morning's pattern. Link Note: it took a while to upload this image, so the OEX prices have changed.

A bull flag performs just the opposite: a steep climb and then a steadying of prices in a tight pattern of lower highs and lower lows. The "flag" in the names comes because of the shape. The sharp first drop or climb looks like a flagpole. The tight pattern of higher highs and lows (bear flag) or lower highs and lows (bull flag) takes on the shape of a flag waving from the flagpole.

  Jonathan Levinson   6/23/200,  11:54:15 AM
The US Dollar Index has horizontal support at 94.10 and trendline support at 94 even, last qyote at 94.16 on a big sell signal, but I'm unable to get realtime on the USD Index futures. With August gold down 2.60 in realtime, I expect that that support is currently holding for the USD Index.

  Jeff Bailey   6/23/200,  11:53:10 AM
InterActiveCorp (IACT) $36.50 .... symbol change and company name chang in place today for "old" USA Interactive (USAI). Also.... Hotels.com (ROOM) looks to have been merged into IACT with today's trade as I haven't seen the stock trade today. I haven't been able to find a finite date of full acquisition.

  Jonathan Levinson   6/23/200,  11:48:13 AM
New lows of the day on ES and NQ. New longs should be getting stopped out or close to it, and existing short stops would not have been touched, as the up-phase on ES and NQ was only sideways.

  Jonathan Levinson   6/23/200,  11:42:42 AM
August gold is getting whacked, down 2.70 to 354, with HUI down 3.95 to 149.77, XAU -1.81 to 78.84.

  Jonathan Levinson   6/23/200,  11:41:25 AM
The put to call ratio has risen to .65, while selling pressure on the COMPX remains moderate, TRIN.NQ 1.39, TICK.NQ -84, QQV down to a .72 gain. FVX -6.7 bps. It's eerie- the indices feel like they're bouncing, except that they're sitting on their lows of the day.

  Ray Cummins   6/23/200,  11:39:24 AM
Spreads/Combos & Premium-Selling -- New Positions

Today's broad retreat in the major equity averages has improved the entry opportunities in our bullish positions and yet it has limited the premium in the bearish issues in only one play, International Business Machines (NYSE:IBM). The best observed credit (on a simultaneous order basis) for the JUL-95C/90C "bear-call" spread was $0.45, however the position may have been available at the target price through individual trades. Elsewhere in the portfolio, technology stocks are enduring stiff selling pressure in the wake of the recent run-up. Mercury Interactive (NASDAQ:MERQ), Cabot Micro (NASDAQ:CCMP), and Electronic Arts (NASDAQ:ERTS) are the most obvious losers in that category. In the biotechnology segment, Biogen (NASDAQ:BGEN), Gilead (NASDAQ:GILD) and Neurocrine Biosciences (NASDAQ:NBIX) are "taking it on the chin" and in the broader market groups, Career Education (NASDAQ:CECO) and Pharmaceutical Resources (NYSE:PRX) are suffering from vigorous profit-taking.

Of course, the retreat is great for a number of bearish positions including: Consolidated Freightways (NYSE:CNF), Adobe Systems (NASDAQ:ADBE), Cigna (NYSE:CI), Fannie Mae (NYSE:FNM), Trimeris (NASDAQ:TRMS), Cephalon (NASDAQ:CEPH), Linear Technology (NASDAQ:LLTC), Xylinx (NASDAQ:XLNX), Maxim Integrated Products (NASDAQ:MXIM).

  Jonathan Levinson   6/23/200,  11:32:46 AM
The short cycle oscillators are way oversold on the NQ and ES, and a bounce here from support should be good to the next s/r level, 988 then 993 ES, 1208 then 1218 NQ.

  Jonathan Levinson   6/23/200,  11:27:42 AM
Treasuries are being bought higher, as FVX falls -6.2 bps, TNX -4.1 and TYX -2.7 bps. Note that there's nearly 9B dollars of fed money being added today- so far it's not piled into equities, only t-bills.

  Linda Piazza   6/23/200,  11:26:39 AM
The OEX currently tests the June 13 low of 495.21.

  Jonathan Levinson   6/23/200,  11:23:52 AM
Another put to call reading of .60, with QQV up 1.13, VXN +.21 and VIX +1.40.

There continues to be no bounce, but no lasting violation of the lower support ranges of 1200 NQ / 980 ES. A stop just above this zone would be optimal for protecting open shorts, and longs could set stops just below the low of the day.

  Jonathan Levinson   6/23/200,  11:23:08 AM

  Linda Piazza   6/23/200,  11:21:18 AM
Decliners now are more than three times advancers. Down volume is 8 times up volume on the NYSE and 7 times up volume on the Nasdaq. Total volume is 414 million on the NYSE and 618 million on the Nasdaq.

  Jonathan Levinson   6/23/200,  11:10:31 AM
Another put to call reading of .60, with QQV up 1.13, VXN +.21 and VIX +1.40.

There continues to be no bounce, but no lasting violation of the lower support ranges of 1200 NQ / 980 ES. A stop just above this zone would be optimal for protecting open shorts, and longs could set stops just below the low of the day.

  Linda Piazza   6/23/200,  11:04:08 AM
That was quick. There's now been a breakdown of that bear flag pattern on the OEX. I'm back to watching OEX 496, or actually the 495.92 low of the day.

  Linda Piazza   6/23/200,  11:01:32 AM
The OEX is moving up from the 496 level, but it's moving up in a pattern that looks a lot like a bear flag.

  Linda Piazza   6/23/200,  10:59:49 AM
Reader Question re Marvel (MVL): Any news to account for the notable drop despite good receipts from the Hulk movie? Thanks !

Response: The only information I find, information you're probably hearing by now, too, is that although the weekend's draw was $63 million, it didn't match last summer's first weekend intake for the Spiderman movie. This morning's gap down moved MVL below the psychologically important $20.00 level, although MVL currently maintains the ascending trendline that has been supporting prices since last August. One clue to the downside that came today was the higher volume that's been seen recently on down days. OBV (on-balance volume) had been strong, but has recently completed a H&S formation of its own and has been trending down since early June. Daily oscillators near oversold levels but haven't yet begun to turn up and the MACD is in full bear roll. Depending on how the ascending trendline is drawn, it appears to cross near $16.75, so bullish and bearish traders alike might be alert to first support at that level. Below that, the 200-ema crosses at $13.53, near $14.00 historical support, so that might be another level for traders to watch. MVL is on a P&F sell signal. The downside target isn't yet determined because that column of O's hasn't yet reversed into a column of X's.

  Linda Piazza   6/23/200,  10:44:13 AM
The OEX does steady at 496, as I thought it might, but that steadying appears somewhat tentative as yet. A quick check of OEX put options prices shows that I could have profited on this morning's move even if the move were to stop at 496, although it's not yet clear that's what's going to happen. The profit wouldn't have been great, but it still would have been profit.

  Linda Piazza   6/23/200,  10:36:42 AM
Now that we've got a rollover in progress, it's time to look again at possible retracements for the OEX March rally. From the March 12 low of 400.24 to the June 17 high of 512.67, the OEX moved 112.43 points. Some have mentioned a 25% to 38.2% retracement as being likely. A 25% retracement would take the OEX down to 484.56. A 38.2% retracement would take the OEX down to 469.72. The 25% retracement, if it happened quickly, would barely violate the ascending channel seen on the daily OEX chart. The deeper retracement would violate that channel.

  Jonathan Levinson   6/23/200,  10:36:18 AM
And there it is- ES prints 979.75, NQ 1200.

  Jonathan Levinson   6/23/200,  10:34:31 AM
GE at its low of the day, ES close to it. It would surprise a lot of traders, bullish and bearish, to see ES break below 980 today.

  Jonathan Levinson   6/23/200,  10:33:26 AM
It pains me to see that HUI and XAU are both negative this morning, with HUI -2.3 to 151.42 and XAU -1.15 to 79.50. If any sector should benefit from the over-the-top liquidity operations of the fed, it would be precious metals. So far today, however, we're not seeing it. August gold is down 20 cents to 356.20.

  Jeff Bailey   6/23/200,  10:31:11 AM
S&P 500 Index (SPX.X) Here's my daily interval chart of SPX with new WEEKLY and existing MONTHLY retracement overlaid from Pivot Matrix. Link

  Jonathan Levinson   6/23/200,  10:29:48 AM
Volume is dropping here and the ES is quite oversold on the short cycle oscillators, but while it trades in a support zone after a surprise selloff, with volume beginning to drop off, it's prudent to expect a bounce. If you're in a profitable short position here, you could set a stop just above 984 if you don't want to close out here. A bounce is to be expected, but so far, none has come.

  Jeff Bailey   6/23/200,  10:29:51 AM
S&P 500 (SPX.X) 985.17 -1.05% ... trying to upload my bar chart with WEEKLY/MONTHLY retracement, but no luck. Three levels of SPX support from pivot matrix at 984 along with mid-point of our upper regression channel. With 21-day SMA rising at 981.26 another area of support. Stochastics on DAILY (5,3,3) now at "oversold."

Will profile bullish trade for SPX at 988. SPX now at 983.15.

  Linda Piazza   6/23/200,  10:28:52 AM
Early volume patterns show decliners more than twice the number of advancers, and down volume swamping up volume. Total volume as of a few minutes ago was a light 196 million shares for the NYSE and 356 million for the Nasdaq.

  Linda Piazza   6/23/200,  10:24:54 AM
I may have missed the boat this morning. I expected a retest of the OEX 501.50 level and it never came, with the OEX not even fully retesting Thursday's low before resuming its plunge. Perhaps I should have entered a put position when the OEX moved below the current day's low after the 9:50 first retracement, but I was studying that 496-497 possible support and those oversold oscillators on the 30 and 60-minute charts and thinking about how options prices can deflate mid-morning on the Monday after opex Friday. Studying those charts, I also saw the potential for a left shoulder and head to have been forming on the OEX hourly chart, with the potential that the OEX would bounce up to test resistance and form a right shoulder. Time will tell, but I might have been too cautious this morning. I had no trouble playing the downside, if warranted, but I wanted a better entry than buying on a straight plunge down just ahead of possible support.

  Jonathan Levinson   6/23/200,  10:21:18 AM
The put to call ratios are back to a normal range, with the total pc ratio at .60, index pcr 1.20 and equity pcr .47.

  Jonathan Levinson   6/23/200,  10:18:56 AM
The fed has announced 5.25B in 3 day repos, which, on top of the expiring 3.5B reverse weekend repo, is an impressive 8.75B net infusion of liquidity for today.

  Jonathan Levinson   6/23/200,  10:07:33 AM
We're approaching 1st support for NQ and ES as profiled in the futures wrap. NQ appears to have slightly more downside potential than ES from here, given the oscillator readings. Note that the QQV is up the most of the volatiliy indices, +1.07. It looks like there's more stock in the NDX to unwind than in the other indices.

  Jeff Bailey   6/23/200,  10:05:59 AM
Ryland Group (RYL) $69.95 -1.05% .... testing its rising 21-day SMA along with 19.1% retracement (recent high to October 2002 low of $31.00).

30-year Treasury YIELD ($TYX.X) unchanged at 4.458% as YIELD looks to fill this morning's YIELD gap lower.

Would think homebuilder bears would look for higher YIELDS to get some breaks lower in the homebuilders here. FOMC meeting and decision on rates Wednesday are key. Group could get hit lower if Fed keeps rates unchanged.

  Linda Piazza   6/23/200,  10:01:26 AM
We're in that time period when the markets attempt a first retracement of the first morning move. So far, the OEX retracement has not been impressive, but the OEX rises further as I type. I have some reservations this morning about jumping right in on the downside, as this is the Monday after opex Friday and premiums sometimes behave strangely. Even if the move goes your direction on the Monday after opex Friday, it's sometimes difficult to make money as time premium leaks out of now-front-month options. Also, the 30-minute and 60-minute oscillators show the OEX approaching oversold levels at the same time it nears 496-497 support. The OEX can continue straight down, of course, but it's also possible for it to attempt a stronger rise while those 30-minute and 60-minute oscillators reset. Volume patterns aren't going to be of much use in guiding us this early in the morning, either, so I'll first watch those benchmarks I've already noted.

  Jonathan Levinson   6/23/200,  9:55:46 AM
GE's highs of the day are offsetting the downside bias in ES. There's a tug of war going on. On the NQ, the TRIN.NQ is up to 1.14, TICK.NQ -501, and QQV .51. Not bullish breadth this morning.

  Jeff Bailey   6/23/200,  9:55:22 AM
Altria (MO) $43.11 +2% Link ... Morgan Stanley raises their price target to $62 from $48 for MO and raises price target on Loews Carolina (NYSE:CG) $25.21 -0.03% Link on belief that valuations will increase as the market more fully recognizes the stabilization in US cigarette fundamentals and significant reduction in total legal risk.

Morgan Stanley downgraded RJ Reynolds (NYSE:RJR) $37.01 -1.64% Link to "underweight" from "equal-weight", saying stock appears overvalued given that the company has the industry's lowest profit margin structure and faces the group's most significant competitive challenges.

  Jonathan Levinson   6/23/200,  9:53:39 AM

  Jonathan Levinson   6/23/200,  9:51:51 AM
The short cycle oscillators on NQ and ES aren't the least bit bouncy yet, and they look to be headed toward lower support straight from here.

  Linda Piazza   6/23/200,  9:46:26 AM
Last Thursday's OEX low was 500.81, so that's another benchmark to watch this morning when the OEX makes its first retracement of the first move and attempts to rise, if it does. In addition, there's the 501.54 50% retracement of the first five-minute range and resistance near 502. Below the current range, the OEX found S/R in the 596-597 range for many days, so that might be the first place to look for support.

  Jonathan Levinson   6/23/200,  9:42:57 AM
The volume on this selloff is first substantial volume of the session on ES and NQ- over 10,000 contracts just flew by on red volume spikes in the past 2 6 minute bars. A break below 988 brings into view the well-publicized 980-983 ES support area.

  Linda Piazza   6/23/200,  9:36:42 AM
The first five-minute OEX candle is another larger-than-normal candle that again gives us some benchmarks to watch early this morning. The midpoint of that candle's range was 501.54. Bulls want to propel the OEX back above that midpoint as the first order of business this morning when we get the usual 9:50 first retracement, while bears want to see that level hold as resistance.

  Jonathan Levinson   6/23/200,  9:36:25 AM
Some selling. ES 989.25, NQ below 1220.

  Jonathan Levinson   6/23/200,  9:33:41 AM
Opening levels have the TRIN.NQ neutral bullish at .77, TICK.NQ -139, QQV +.37. I expect choppiness as opex positions get squared away.

  Jonathan Levinson   6/23/200,  9:32:28 AM
The Plunge Protection Team was legislated into being by President Reagan. It's called the Working Group on Capital Markets. The legislation is posted on the internet. The fed's open market ops, a different form of more transparent intervention, also exist, and I report on that daily. There's nothing mythical about the PPT- it exists as a matter of public record and law.

  Jonathan Levinson   6/23/200,  9:27:16 AM
The buying in treasuries is steady, while the US Dollar Index has cleared 94 pretty decisively for the moment. I expect US Dollar strength to be bearish for equities and treasuries overall, as discussed in the futures wrap this weekend. Listening to Doug Noland this weekend, even he was forced to admit that the fed's massive injections of liquidity should eventually benefit balance sheets and fundamentals, but that the risk of a catastrophe is still out there. What is no longer in doubt is that the fed's money was behind the equity/treasury/commodity rallies that occurred together this spring. I'll be posting the fed's open market ops when announced shortly.

  Jeff Bailey   6/23/200,  9:16:23 AM
09:00 Update posted at this Link

  Jonathan Levinson   6/23/200,  9:01:36 AM
Treasuries are getting bought aggressively, but the tens are not leading the charge this time, FVX -4.2 bps, TNX -2.8 and TYX -1.5 bps. QQQ is trading 30.31, ES -.75 to 990.75, NQ -.50 to 1221.50 and YM -10 to 9145. August gold is up .30 to 357.

  Linda Piazza   6/23/200,  7:18:48 AM
Good morning. The Nikkei dipped about 45 points below Friday's close during early trading, perhaps due in part to the surprise decline in Japan's May trade surplus, but then the index climbed to its highest level before the midday break. Although the Nikkei could not maintain the day's high during afternoon trading, it managed a positive close, up 16.75 points or 0.18%, at 9137.14. The Ministry of Finance's figures showed the trade surplus dropping 5.5% from April's number, while still rising 12.5 % from the year-ago number. May exports rose 1% over April's while imports rose a faster 2.5%.

Banks led the gains, with two factors seeming to buoy the banks. Banks such as Mizuho Financial were rebounding after last week's bond-related declines. Small-to-midsize banks that serve small businesses, called shinkin banks, gained after a report that the Shinkin Central Bank would help those whose capital ratios had dropped below 6% with an infusion of capital.

Many tech stocks dropped across Asia, however. As a result, many other Asian bourses declined. Taiwan's Weighted dropped 1.62%, South Korea's Kospi fell 16.69%, Singapore's Straits Times dropped 1.80%, and Hong Kong's Hang Seng fell 1.97%.

Many European markets also trade down as of this writing, although most are off their lows. Most attribute the declines to profit-taking after the big rallies, especially ahead of earning that might disappoint and the U.S. FOMC meeting. Brewer Heineken and U.K. bank Lloyds were two issues whose reports disappointed. Although banks gained in Japan, financials generally are losing ground in Europe. As of this writing, the FTSE 100 trades down 20.60 points or 0.50%, to 4139.50; the CAC 40 trades down 21.18 points or 0.66%, to 3168.93; and the DAX trades down a minimal 0.53 points or 0.02%, to 3238.45.

  James Brown   6/20/200,  11:38:56 PM
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