Option Investor
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  Jeff Bailey   1/16/200,  6:43:21 PM
Weekly in/out MM trade review at this Link

Stinker! I got sandwiched with a nice gain early in the week from a carry over swing trade in SRV, got a losing streak going, but finished on a slightly positive note.

OSTK bull was a good entry, but after-hour news on 01/13/04 regarding CEO and CFO disagreement had me thinking it was better to cut out with fractional loss than sit around and see what happened. I like this company, will continue to monitor, but don't like to disagreement at top management.

SWC somewhat associated with "gold" stock, which it isn't, but that's sector association.

SONE, TOL were trades I thing got swung around on Thursday's Index experation. Learn the lesson yet again that option experation a tough trade.

QQQ ... tried shorting correlative pivot resistance. No complaints except to understand that trend is up and demand still strong.

JDSU ... shorts are sideways in this one. Thought converts that might have gotten a squeeze going from $3.50 when I first alerted to squeeze potential were going to sell into some strength at conversion price of $4.94, it doesn't look like they are. Congratulations to JDSU for bringing a convertible when the stock is trading at a low, not a high. Looking for gold stocks that have issued convertibles or secondary offerings. If you know of any, e-mail me.

AA ... easiest way to break a losing streak is with a liquid NYSE listed stock and one that has treated you well in the past. While I have confidence in my trading ability, its always good to try and finish the week out with a gain, even if its a small one.

I'll get that 3.3% back next week. (based on equal dollar amount in each trade)

Those that trade round lots of 1,000 shares. -$1.12 points for week.

  Jeff Bailey   1/16/200,  6:07:53 PM
Pivot Matrix for Tuesday at this Link

  Jeff Bailey   1/16/200,  4:37:42 PM
Closing Internals at this Link

  Jeff Bailey   1/16/200,  4:15:03 PM
Get your bullish prescriptions filled!!!! Express Scripts $68.32 +2.42% Link making a little move today.

Still some room to the bullish vertical count of $93.

I'm just now seeing Jane's 13:15:12 post.

  Jeff Bailey   1/16/200,  4:10:55 PM
QQQ $38.60 +1.12% ... a little ramp up to the close.

  Linda Piazza   1/16/200,  3:55:49 PM
It's going to be a hard run into the stretch to see if the OEX can make 565. Thinking about opex, I'm wondering if the OEX won't get pegged just beneath 565 into the close.

Have a great long weekend, everyone.

  Jeff Bailey   1/16/200,  3:52:14 PM
AA day trade stop alert $35.05

  Linda Piazza   1/16/200,  3:49:42 PM
Next OEX Keltner resistance has risen to 564.29, with next resistance above that currently at 564.92. Support has risen, too, with next support at 563.79, but stronger support at 563.28.

  Linda Piazza   1/16/200,  3:48:01 PM
As of a few moments ago, volume was 1.4 billion on the NYSE and 2.3 billion on the Nasdaq--not quite a 4 billion day yet, but getting close. Adv/dec ratios and up/down ratios have remained strong all day, and new highs are 841 compared to only 4 new lows.

  Jeff Bailey   1/16/200,  3:45:08 PM
Alcoa AA $35.08 ... day trade raise stop alert raise stops to $35.05 here.

There was a pretty good seller of the $35 puts this morning at $0.20-$0.25

  Jim Brown   1/16/200,  3:40:14 PM
Initial market on close orders mixed with a BUY side bias

  James Brown   1/16/200,  3:39:16 PM
Another stock to watch is RJ Reynolds Tobacco (RJR). Shares have been consolidating its Q4 gains in a sideways channel. Look for a breakout over $60 but be aware of earnings near Jan. 27th.

  Linda Piazza   1/16/200,  3:38:05 PM
As we head into the MOC orders, Keltner channels show decent support for the OEX at 563.13 and decent resistance at 564.14.

  Linda Piazza   1/16/200,  3:30:15 PM
Will that 564.45 print be the highest the OEX sees today? Possibly. The five-minute chart shows a possible lower five-minute high, but the $TRIN is dropping, so who knows?

  Jeff Bailey   1/16/200,  3:21:35 PM
S1 Corp. (SONE) $9.28 +2.96% ... about 40-minutes left until the Friday weekend close. Can bulls push it to a 52-week high for bold print this weekend?

  Jeff Bailey   1/16/200,  3:19:42 PM
03:00 Internals at this Link

  James Brown   1/16/200,  3:14:13 PM
Continuing its climb with a rising channel are shares of Tyco Intl (TYC). The stock is breaking out over the $28.00 level but it feels like a chase here.

  James Brown   1/16/200,  3:12:57 PM
Surging to new highs today is chip stock Siliconware Precision Industries (SPIL). The stock is breaking out over the $6.00 level after rebounding from its simple 10-dma.

  Jeff Bailey   1/16/200,  3:07:14 PM
Short squeeze alert General Cable (BGC) $9.00 +4.28% .... did a secondary offering on 11/19/03. Stock bidding above offering level.

  Jeff Bailey   1/16/200,  3:03:49 PM
AA $34.96 ... 342,000 shares in that 5-minutes... there's something going on at $35.00 strike.

  Linda Piazza   1/16/200,  3:02:03 PM
On a hunch, I checked when the Russell 2000 cleared its 200-week ema. Yep, my hunch was right. It cleared it in late May, far ahead of the other indices I've checked. It's way extended above that 200-week ema, too, 140 points above that important average. In March, 2000, it was more than 180 points above that moving average, though, so it can get even more extended than it is now.

  Jeff Bailey   1/16/200,  2:56:54 PM
Alcoa (AA) $34.93 -1.52% ... high of the afternoon. Biggest question here is if there's any $35.00 option related action?

The INDU need you... lets get a move on.

  Linda Piazza   1/16/200,  2:54:28 PM
This week, the SPX will likely have a weekly close above its 200-week moving average (simple) for the first time since June 2001, with many technicians also watching the 200-week. When I'm studying longer moving averages, I prefer to use the exponential moving averages, however, and didn't realize I'd somehow switched the 200-week ema to a 200-week sma. A study of the 200-week ema shows that the SPX consolidated just beneath its 200-ema from October through late November, when it finally cleared that moving average. It was after that MA was cleared on a weekly closing basis that we saw the SPX gains accelerate. The Wilshire showed a similar pattern, although the Dow cleared its 200-week ema much earlier, in August, coming back to test it again in September before climbing.

Want to know where the NDX is now? It's about 15 points above that MA, at 1532.86. Does this mean that the big-cap techs have some room to run, I wonder? Or will this be a trigger for a turnaround?

  Jeff Bailey   1/16/200,  2:53:10 PM
C'mon Alcoa (AA) get the bounce from the bottom. Show'm what the inchworm's tail is made of!

  Jeff Bailey   1/16/200,  2:52:25 PM
Dow Industrials (INDU) 10,563.11 +0.08% ... sitting right on its WEEKLY R1.

After seeing a quick little reverse in the NDX after it finally tested its WEEKLY R1, it's now up to the INDU to show an "Umph"

  Keene Little   1/16/200,  2:52:06 PM
Oh well, it was worth a try Jeff. It may still rally from here, but this deep a retracement into what I expected as support now leaves me wondering about the underlying strength. It does look like it got slapped down after touching weekly R1.

  Jeff Bailey   1/16/200,  2:49:37 PM
Dang it! Keene ... I didn't see the NDX trading that WEEKLY R1.

  Jeff Bailey   1/16/200,  2:48:47 PM
Ouch! NDX 1,543.51 +0.75% ... rather quick drop after test of WEEKLY R1.

  Jeff Bailey   1/16/200,  2:46:26 PM
Go get'em Keene!

  Jeff Bailey   1/16/200,  2:43:02 PM
Sell Prog. Prem. Alert ... SPX = 1,138.10 ... QQQ = $38.42

  Jeff Bailey   1/16/200,  2:35:59 PM
Positive developing in my e-mini S&P futures contract (es04h) ... while I'm 10-minute delayed, I see this contract 5-minute bar did show a close 1,136.50. Chart to follow. Link

Same technique of "fitting," but gives us some levels to further manage upside potential to the 1,163 level. Look for institutions to be buying futures rather aggressive into the close.

Tie in the sell program prem alert, no change in cash SPX

  Ray Cummins   1/16/200,  2:34:39 PM
Spreads/Combos/Premium Selling -- Market Movers!

With the market rallying into the close, a number of recent portfolio positions are showing strength including: Accredo Health (NASDAQ:ACDO), Digene (NASDAQ:DIGE), Digital River (NASDAQ:DRIV), eResearch Technologies (NASDAQ:ERES), Gen Probe (NASDAQ:GPRO), Multimedia Games (NASDAQ:MGAM), New Century Finance (NASDAQ:NCEN), Patterson-UTI Energy (NASDAQ:PTEN), Rambus (NASDAQ:RMBS), Sepracor (NASDAQ:SEPR), and Smith International (NYSE:SII). All of these issues warrant consideration for bullish plays.

  Linda Piazza   1/16/200,  2:24:12 PM
OEX 565-565.70, here we come? This seemed impossible a few days ago, but that's what volume patterns, the ascending regression channel, and other factors have been predicting since this morning. Too bad I didn't feel like gambling on that possibility this morning, but decided to take Jeff's advice from last night's wrap and enjoy a four-day holiday from trading.

  Jeff Bailey   1/16/200,  2:23:52 PM
SPX 1,139.49 +0.65% ... session highs. Supply should be limited to 1,144-1,145

  Jeff Bailey   1/16/200,  2:15:13 PM
Day trade long alert .... Alcoa (AA) $34.84 here, stop $34.64, target $35.25.

  Linda Piazza   1/16/200,  2:13:14 PM
The 60-minute OEX chart shows the OEX encountering envelope resistance at 564.07, with the Keltner channels showing resistance at 564.27, so that the two are close. The two suggest that 564 might be a top for the OEX this afternoon, while the 30-minute envelopes suggest a high between 565-565.68.

  James Brown   1/16/200,  2:12:42 PM
Pharmaceutical Resources (PRX) might be worth watching. Shares have finally filled the gap from September and yesterday's intraday low was a bounce near its simple 200-dma. The question now is whether investors will buy the dip to support or look to short a breakdown under the 200-dma. Technical oscillators are already strongly oversold from its six-week decline.

  Jeff Bailey   1/16/200,  2:10:17 PM
SPX 1,137.47 +0.47% ... just sitting here. Bullish wedge looks to be forming. Horizontal highs, but higher lows intra-day.

Sell programs and little downside suggest computers trying to feed liquidity for building demand.

  James Brown   1/16/200,  2:09:52 PM
A couple of blue chips to watch for earnings next Tuesday are MMM and UTX. (remember, Monday is a holiday)

Shares of MMM are breaking out above the $85 level today after bouncing from its 40-dma a week ago. Investors are anticipating MMM to beat estimates of 76 cents/share.

UTX is trying to breakout over the $96.75 level. Estimates are for $1.13/share.

  Jeff Bailey   1/16/200,  2:07:36 PM
02:00 Internals at this Link

  Ray Cummins   1/16/200,  2:04:49 PM
Spreads/Combos/Premium Selling -- On The Move: ImClone (NASDAQ:IMCL)

One of our favorite biotech stocks, IMCL is up $1.60 at $42.60 on speculation of a near-term approval for the company's colon cancer drug Erbitux. The Food and Drug Administration has to decide whether to approve Erbitux before 2/13/04 and Dr. James Palmer, chief scientific officer and president of the company's pharmaceutical research institute, announced they have started Phase III trials to confirm earlier Erbitux study results. Palmer also said the company expects to file for U.S. marketing approval of its experimental hepatitis B drug Entecavir sometime this year, thus investors have other news to celebrate. Our recent "premium-selling" positions have been successful at the $35 strike, however with the potential volatility in the issue, we can move down to the $30 strike with a limited-risk combination position. Speculative traders might also consider an OTM debit spread at the $45 or $50 strike.

  Gerald Melson   1/16/200,  2:04:44 PM
Option expiration day can bring opportunities to traders. One concept is that of selling puts way in the money and "locking in" nickels and dimes while at the same time selling the underlying short (covered put so to speak). At the same time, perhaps by the same trader, one might purchase the underlying while selling way in the money calls, again "locking in" that nickel or dime. A requirement is that the underlying be very liquid. Hence, a MSFT with the 27.50 strike, NEM at the 42.50 level, or an EBAY at the 65 strike are excellent examples being shown today. It can be a very good strategy but one that should only be practiced by an experienced trader that is well financed.

  Jane Fox   1/16/200,  2:01:44 PM
Jeff that is odd about the NDX for NQ is the strongest futures market today.

  Jeff Bailey   1/16/200,  2:00:34 PM
NASDAQ-100 Index (NDX.X) 1,546 +0.93% ... still hasn't seen a trade at its WEEKLY R1 of 1,550.14.

Only index within our WEEKLY pivot matrix not to do so.

  Jeff Bailey   1/16/200,  1:55:23 PM
Sell Prog. Prem. Alert ... SPX = 1,136.97 ... QQQ = $38.41

  Linda Piazza   1/16/200,  1:54:15 PM
The indices seem to take turns leading the pack, don't they? The OEX has not yet traded over its previous high of the day, although it's growing close, with that previous high at 563.48 and the OEX at 563.28 as I type. It's still climbing the bottom support of that rising regression channel that's been forming much of this week. There's little else to say, except perhaps we should take wagers on whether it's really going to hit 565 by the end of the day.

  Jeff Bailey   1/16/200,  1:52:54 PM
General Electric (GE) $33.10 +3.46% ...

Has OEX 563.26 +0.51% challenging morning high of 563.48.

  Jeff Bailey   1/16/200,  1:51:19 PM
That sell program was gobbled up by the bulls ... SPX 1,137.59 +0.48% steady. Still looks to have 1,145 potential into the close.

  Jeff Bailey   1/16/200,  1:48:07 PM
Sell Prog. Prem. Alert ... SPX = 1,136.75 ... QQQ = $38.40

  Jeff Bailey   1/16/200,  1:45:27 PM
LSI Logic (LSI) $11.10 +2.96% ... BIG intra-day volume spike about 30-minutes ago of 1.2 million shares from $10.92-$11.02.

  James Brown   1/16/200,  1:43:28 PM
It just won't stop! I'm talking about TASER Intl (TASR). This highly shorted issue just continues to climb. Yesterday Roth Capital issued a "sell" rating but to no avail. The stock is up another $12.54 to $123.69.

  Ray Cummins   1/16/200,  1:40:55 PM
Spreads/Combos/Premium Selling -- On The Move: Cyberonics (NASDAQ:CYBX)

Another popular stock among momentum traders is CYBX, which is up $3.84 at $37.25 on optimism the company's pacemaker-like device will win U.S. regulatory approval to treat chronic depression. An additional catalyst for the upside activity is Boston Scientific's (NYSE:BSX) recent request to increase its stake in the company. Cyberonics announced earlier this week that it extended the time frame (until February 28) under which Boston Scientific could increase its investment and the period prior to that date will likely see additional buying pressure in the issue. Our bullish position at $30 is expiring (profitably) today, but there may be additional spread/combination opportunities in the coming week.

  James Brown   1/16/200,  1:27:15 PM
While shares of Freddie Mac (FRE) are still under resistance in the 61-62 area the stock has broken its 2-year trend of lower highs. The recent drop in mortgage rates has given the stock new life to breakout above the $60 level yesterday.

It does look like the stock is in a wide, rising channel (for the last 7 to 8 months) and that puts the upper edge of the channel near in the $63-65 region.

  Ray Cummins   1/16/200,  1:24:50 PM
Spreads/Combos/Premium Selling -- On The Move: Chicago Mercantile Exchange (NYSE:CME)

Among the big movers in the market today are shares of CME, which are up $5.34 at $80.25 after Bear Stearns initiated coverage on the issue with an "outperform" rating. Another analyst, Joel Gomberg with William Blair & Co., said CME's earnings outlook is being helped by strong trading volumes for many of its core products. For example, last Friday the CME set a new single-day trading volume record of 4.54 million contracts, topping a mark from July 31, 2003. The level of futures and options trading volumes is a major factor in CME earnings, thus investors are optimistic about the fourth-quarter report, which is due 1/3/04. Our bullish spread is expiring today at maximum profit, however we will be looking for a new position in the issue in the coming sessions.

  Linda Piazza   1/16/200,  1:16:59 PM
The OEX still climbs the bottom support of the ascending regression channel on its 30-minute and 60-minute charts, with the midpoint and top resistance climbing along with the channel. The inner envelope boundary has now risen to 565.27, too, supporting the possibility that the OEX could climb that high. I'm just not sure how much credence to give this on opex Friday, although volume patterns sure continue to support that thesis.

  Jane Fox   1/16/200,  1:15:12 PM
Jeff nice move in ESRX today.

  James Brown   1/16/200,  1:08:37 PM
Current OI call play STJ has broken back above the $64.00 level, which is good news for traders considering new entry points.

  James Brown   1/16/200,  1:07:25 PM
Shares of Brunswick Corp (BC) have had a stellar week! The stock has broken out from under resistance at $32 and is approaching its all time highs from 1997-1998. Probably best known for its bowling products, Brunswick also produces outboard engines, motorboats and yachts, and various fitness equipment. Driving the stock price was a recent upside preannouncement. BC raised its earnings guidance for the December quarter from 28-33 cents/share to 40-43 cents/share. Consensus estimates were 32 cents. Earnings should be Jan. 29th.

  Andy Aronson   1/16/200,  1:00:28 PM
Official .SET on SPX 1137.52

  Linda Piazza   1/16/200,  12:54:51 PM
Have we entered the time of day on opex Fridays when the OEX breaks through a bullish formation and goes nowhere and then breaks through a bearish formation and goes nowhere? Maybe. Volume patterns still look bullish.

  James Brown   1/16/200,  12:49:56 PM
Up, up and away! Shares of Plexus Corp (PLXS) are screaming higher (+18%) after a strong upgrade from RBC Capital markets. RBC raised PLXS to an "out perform" and raised its price target from $19 to $25. PLXS is now trading at $24.00. Earnings should be Jan. 21st.

  James Brown   1/16/200,  12:41:37 PM
Cree Inc (CREE), a maker of materials and devices for semiconductor creation, announced a strong December quarter, beating estimates of 15 cents by 2 cents. Revenues were up more than 28% and the company guided higher for the next quarter. Investors responded positively to its stronger guidance and the stock is up 20.5% to $25.45. I'd probably watch this one for a pull back as the weekly chart suggest strong resistance in the $26-27 range.

  Jeff Bailey   1/16/200,  12:35:40 PM
Toll Brothers (TOL) $39.92 +1.06% ... just kissed the $40.00 level. This $40 level may well be an option expiration level, which may provide near-term resistance.

Short-term bull may want to exit position here near-term. Yesterday we observed suspicious trade at $40.01.

  Linda Piazza   1/16/200,  12:34:41 PM
The OEX is following the typical pattern of late, breaking above the descending trendline, consolidating for a few five-minute candles after breaking out, and then beginning a zoom up. If it carries through, the OEX might see the top of that rising regression channel yet, with the midline at 565 and the top now at 566.82. This is opex week, though, so it's equally possible that the indices will soon get nailed to their now-current levels and stay there the rest of the day.

  James Brown   1/16/200,  12:33:49 PM
Another stock enjoying the strength in the networking sector is Finisar Corp (FNSR) Not one to play options on as the stock just broke through the $4.00 level but volume has been very strong on the rallies. The $4.25 mark is the next hurdle for the bulls. (FYI: FNSR works with fiber-optic systems for high-speed data transfer.)

  James Brown   1/16/200,  12:31:02 PM
Timberland Co (TBL) may be a blossoming bearish candidate. A morning downgrade from JPMorgan to "under weight" has helped push TBL under the $50 mark and its rising 200-dma. Shares might have support near $47.50 but it looks vulnerable to the $45 level. Its P&F chart looks worse. If TBL trades to $48 it will be a double-bottom sell signal and the next P&F support isn't until the $41 area.

  Andy Aronson   1/16/200,  12:30:49 PM
The SPX open or .SET is Unofficially 1137.50. This is the number that Jan SPX options are settled against. The settlement is based on the opening price of all 500 stocks in the index.

  Linda Piazza   1/16/200,  12:30:38 PM
The TRAN is once again within striking distance of its March, 2002 swing high. The TRAN is at 3035.66 as I type, with the March, 2002 intraday high at 3050.40, but the more important closing high at 3049.96. The TRAN has resistance from here to Monday's 3044.47 high.

  Jeff Bailey   1/16/200,  12:29:24 PM
Day trade bearis stop alert ... JDSU $5.02 +13% ...

Do NOT, I repeat Do NOT be complacent with a stop on this trade.

  James Brown   1/16/200,  12:27:26 PM
Jumping on the Juniper bandwagon... at least 7 firms have upgraded the stock following last night's big earnings report.

  Jeff Bailey   1/16/200,  12:26:14 PM
Day trade short alert .... JDS Uniphase (JDSU) $4.96 +11.2% ... keep stop at $5.02, but now look to cover position on any pullback to $4.92

  James Brown   1/16/200,  12:24:47 PM
Current OI call play GILD is enjoying some strength in the biotech sector (BTK +2.15%) and shares of GILD have broken out of its recent five-day consolidation pattern. Now we just need to see it break the $64 level.

  Linda Piazza   1/16/200,  12:24:09 PM
So far, all volume patterns support a bullish thesis. Of course, that can change quickly, but that's what's showing up now.

  James Brown   1/16/200,  12:22:15 PM
Current OI call play DGX is also seeing a minor amount of profit taking today. The $75 level should now be new support and probably the best place to gauge new entries.

  Jeff Bailey   1/16/200,  12:18:46 PM
JDS Uniphase (JDSU) $4.96 +10.8% ... not looking good for day trade bearish at new high of day.

  Jeff Bailey   1/16/200,  12:16:29 PM
Major Indices showing intra-day wedges forming.

  Linda Piazza   1/16/200,  12:10:55 PM
The OEX broke above the upper trendline of the regression channel I showed in my 11:50 chart, but only minimally so far. Usually, the OEX might hesitate for two or three five-minute bars, but then zoom up. We've got a couple of five-minute bars behind us so far. Now we're just waiting to see if the zoom occurs. The OEX is continuing to find support at the bottom of its rising regression channel and continues to find resistance at the midline of that channel, with that midline now having risen to 564.

  Jeff Bailey   1/16/200,  12:10:19 PM
12:00 Internals at this Link

  James Brown   1/16/200,  12:04:30 PM
Current OI call play AMZN is seeing a little bit of profit taking after a very strong week. The $55.00 level should be new support and is where I would expect buyers to support the dip if the markets hold up. Should the major indices turn lower then look for a dip to the 10-dma in AMZN (closer to $53.50).

  Jeff Bailey   1/16/200,  12:02:06 PM
10-year YIELD ($TNX.X) ... pretty good reversal taking place and selling in Treasuries. 10-year YIELD now higher by 3.9 bp at 4.01%.

  Jeff Bailey   1/16/200,  11:52:09 AM
AMEX Gold Bugs ($HUI.X) 98.55 +1.24% ... trying to get a little bounce going.

Newmont Mining (NEM) $43.20 +1.45% ... Jan option oi heavy at Jan $50 C, Jan $45 C, Jan $47.50 C and Jan $35 P.

  Linda Piazza   1/16/200,  11:50:15 AM
Here's what I'm watching on a five-minute OEX chart: Link

  Jeff Bailey   1/16/200,  11:47:42 AM
Sell Prog. Prem. Alert ... SPX = 1,134.00 ... QQQ = $38.25

  Linda Piazza   1/16/200,  11:42:11 AM
Volume looks strong today, with the Nasdaq already having traded more than 1 billion shares. As of a few minutes ago, total volume was 616 million shares traded on the NYSE and 1.1 billion on the Nasdaq, with all volume patterns bullish, too.

  Linda Piazza   1/16/200,  11:24:41 AM
As has become entirely normal, the OEX broke below an ascending trendline, halted its fall at next support and then began climbing again, soon to challenge the underside of the violated trendline. We've seen this pattern repeated over and over since March, across five-minute to weekly charts. However, a lower low was hit. There's now the possibility that the OEX may be forming a new descending regression channel off this morning's highs. It's been usual for the OEX to break through these descending regression channels, as it did yesterday's.

  Jeff Bailey   1/16/200,  11:18:29 AM
11:00 Internals at this Link

  Jim Brown   1/16/200,  11:10:06 AM
Everything is relative. A dip for one trader is a disaster for another. It all depends on your position. Link

  Linda Piazza   1/16/200,  11:00:39 AM
We've now had the lower high confirmed on the OEX five-minute chart. The 30-minute chart shows the OEX retreating to again test the lower boundary of its rising regression channel that formed over the last few days. This could be a bounce point. The 30-minute oscillators do not yet support that idea, however, as they're rolling down. We know how much we trust oscillators these days, though, don't we?

  Jeff Bailey   1/16/200,  10:57:41 AM
Day trade short ... JDSU $4.87 here, stop $5.02, target $4.65.

Please note: Weeks ago I issued upside call on JDSU with targets at current levels based on convertible. Now we're there, looking for some near-term dillution as convertible price target is met.

  Jeff Bailey   1/16/200,  10:56:54 AM
Sell Prog. Prem. Alert ... SPX = 1,133.85 ... QQQ = $38.20.

  Linda Piazza   1/16/200,  10:55:49 AM
The OEX is now testing an ascending trendline off yesterday's 15:12 low, and now falls just below it as I type. We've seen a lot of false breakdowns lately, though, and there's support just below, down to 561.20, the level of the 38.2% retracement of the bear-market decline. I'd be wary of a bounce from just below 561. If not, though, the lower five-minute high has been confirmed.

  Jim Brown   1/16/200,  10:55:02 AM
CNN reporting a power plant on fire in NY state.

  Linda Piazza   1/16/200,  10:47:11 AM
The OEX continues to turn down at the midline of its rising regression channel, with shadows spiking up through it, but that doesn't mean that the OEX can't climb the underside of that midline support all day.

We have a potential lower high on the five-minute chart, but that will need to be confirmed by a drop below 561.16, the last five-minute trough. There was no bearish divergence as that possible lower high was produced, and there's Keltner support near 561.40 now.

  Jeff Bailey   1/16/200,  10:44:49 AM
JDS Uniphase (JDSU) $4.90 +9.64% ... back to test the $4.94 conversion level. See today's rather notable volume increases? This suggests conversion is taking place.

  Linda Piazza   1/16/200,  10:37:58 AM
Earliest volume patterns show the expected bullish patterns: adv/dec ratios of 18/11 for the NYSE and 16:11 for the Nasdaq, and up volume 2.7 times down volume on the NYSE and 3.7 times down volume on the Nasdaq. Total volume as of a few minutes ago was 339 million on the NYSE and 649 million on the Nasdaq, with these figures looking slightly stronger than yesterday's volume at this time of day.

  Jonathan Levinson   1/16/200,  10:37:04 AM
Euros and swiss francs at session lows too- looks like a spike higher in the USD.

  Jeff Bailey   1/16/200,  10:33:33 AM
AMEX Gold Bugs ($HUI.X) 218.02 -0.43% Link .... lows of the session.

Gold/Silver Index (XAU.X) 96.95 -0.4% Link ... testing longer-term trend.

U.S. Dollar Index (dx00y) 87.31 +0.87% Link ... 3-box reversal higher.

  Jeff Bailey   1/16/200,  10:27:19 AM
General Electric (GE) $32.32 +1.00% Link ... FAIRFIELD, Conn. (AP) -- GE has said it expects to return to double-digit profit growth in 2005 after limited to modest gains this year.

  Linda Piazza   1/16/200,  10:23:43 AM
Because the first five-minute range was so large on the OEX, I switched to the first one-minute range on which to measure trading action. The first one-minute low and high were 560.58 and 562.78. According to Jeff's MRT system, using the first one-minute data, the OEX today has not yet traded over the bullish #2, which would be at about 563.70. It's still in a neutral zone. It is, however, below the midpoint of the first one-minute of trade and of the first five-minutes, too. In fact, it's right now sitting on the 38.2% retracement of the bear-market decline, a level that should have been strong resistance and might now be presumed to be strong support. We'll see if it holds.

  Jonathan Levinson   1/16/200,  10:17:18 AM
A 2.75B repo has just been announced, which effects a 2.25B net drain against the 2-day 5B repo expiring today.

  Jonathan Levinson   1/16/200,  10:16:37 AM
Linda, I hate politics, but it astounds me that the public accepts that its officials make repeated statements that are solidly, unequivocally refuted by the facts. The "resistance to counterfeiting" reversal is the kind of thing that would compromise a person's credibility, but it seems to get accepted in the public sphere. Sorry for the rant- there's some repo data out.

  Jeff Bailey   1/16/200,  10:15:55 AM
10:00 Internals at this Link BIG volumes early suggest option expiration volatility.

Yesterday's internals at this Link

  Linda Piazza   1/16/200,  10:14:27 AM
Don't know if you caught my first post on the foreign markets this morning, Jonathan, but a Japanese official today refuted the idea that the U.S. supports a strong dollar. Supposedly, that claim had little effect on Japanese trading, with exporters still gaining, however.

  Jeff Bailey   1/16/200,  9:59:25 AM
Sell Prog. Prem Alert SPX = 1,136 ... QQQ = $38.30

  Linda Piazza   1/16/200,  9:58:40 AM
The OEX turned back from Keltner resistance, now at 563.62, but closer to 563.50 at the time. Strongest Keltner support has been breached, but below this, thin Keltner support lies at 562.13 and stronger support at 561.24, with strongest support near 560.

  Jeff Bailey   1/16/200,  9:57:10 AM
JDS Uniphase (JDSU) $4.77 +6.73% ... May look for sellers near-term at $4.94. See Intra-day commentary from 10/28/03 at this Link

  Linda Piazza   1/16/200,  9:47:53 AM
If that inverse H&S on the OEX had any validity, it would have an upside target of about 565, the top of the rising regression channel. There was no bullish divergence as the head was produced, it was misshapen, and it was a rare continuation inverse H&S, but, hey, despite all those minor technicalities, the OEX did at least partially fulfill the upside target. It's got a point or two to go before the target is fulfilled, however, with more resistance along the way. Not too much, though: just Keltner channel resistance near 563.48, and envelope resistance near 564.

  Jonathan Levinson   1/16/200,  9:47:53 AM
Thanks, Jim. 9:47am UMICH JAN SENTIMENT RISES TO 103.2 VS 92.6 IN DEC

  Jonathan Levinson   1/16/200,  9:45:03 AM
Awaiting Michigan Sentiment any minute.

  Linda Piazza   1/16/200,  9:41:05 AM
The OEX approaches yesterday afternoon's high of 562.96. It has printed a high of 562.92 so far.

  Linda Piazza   1/16/200,  9:37:46 AM
The OEX first five minutes spanned a range from 560.58 to 562.78, with the midpoint at 561.68, and with the OEX above that midpoint. We'll watch that midpoint as a gauge of strength or weakness in the first retreat, if there is one.

Today's first five-minute range was again bigger than usual, perhaps indicating volatility in today's trading, but that observation must be tempered by the realization that this is opex Friday and all movement tends to grind to a halt about midmorning over the last months on opex Friday. We'll have to see which pattern wins out, but Jeff's observation last night that this would be a good time for a four-day weekend might be a good one.

  Jeff Bailey   1/16/200,  9:36:13 AM
Pacholder High Yield (PHF) $9.60 +2.01% .... Last night's Index Trader Wrap.

  Jeff Bailey   1/16/200,  9:35:23 AM
Sector action broadly positive with Networking ($NWX.X) 321.45 +5.3%, Internet (INX.X) 187.36 +2.87% and Telecom (XTC.X) 631.46 +1.2% leading gains.

Transports (TRAN) 3,026 -0.19% and Oil (OIX.X) 318.48 -0.03% only two sectors showing losses.

  Linda Piazza   1/16/200,  9:32:18 AM
We're seeing the expected big spike in the OEX at the open. The OEX has spiked all the way to the midline of the rising regression channel it's established on intraday charts over the last few days, with the top of that channel near 565. Keltner channels suggest resistance at the current level and then at 563.33.

  Jeff Bailey   1/16/200,  9:24:08 AM
09:00 Update at this Link

  Linda Piazza   1/16/200,  9:19:39 AM
The OEX appears to have broken out (to the upside) of its possible bull flag formation on its daily chart, but the candle produced was indicative of indecision. There's nothing undecided about futures this morning, and if those futures are indicative of the OEX open, that open will continue the upside breakout. The OEX ended the day near midline support on the Keltner channels and just above the 30-minute 21-pma, so the ending level was hinting at a bounce this morning.

  Jane Fox   1/16/200,  9:19:38 AM
In a remarkable turnaround, new Federal Reserve data show the recovery in the stock market and steadily rising home prices have almost restored the wealth of American families to levels last seen when the stock market peaked in 2000.

With the S&P gaining almost 50% since the cyclical low in October 2002 and homes continuing to rise in value, total household net worth has been calculated at $42.1 trillion, which isn't far from the record high of $43.6 trillion reached at the end of the first quarter of 2000.

  Jonathan Levinson   1/16/200,  9:18:37 AM
Those are disappointing numbers just released, but the futures are so far not reacting to them. The Teflon Market will not be swayed.

  Jonathan Levinson   1/16/200,  9:17:36 AM
U.S. Dec industrial production up 0.1%; capacity utilization 75.8%

  Jonathan Levinson   1/16/200,  8:33:37 AM
U.S. Nov. inventories rise 0.3%.

  Jonathan Levinson   1/16/200,  8:25:22 AM
We await Business Inventories for Nov at 8:30, est. .2%, and then at 9:15AM, Industrial Production for Dec., est. .5%, capacity utilization est. 76%, and at 9:45 Michigan Sentiment est. 94.

  Linda Piazza   1/16/200,  7:08:34 AM
Good morning. The Nikkei opened higher in Friday's trading, with IBM's and Samsung's earnings boosting tech stocks. The Nikkei traded in a 50-point range throughout the morning, not able to breach the 10,800 resistance. Early in the afternoon, the Nikkei finally hit 10,800 and then later hit 10,850, closing up 192.05 points or 1.80%, at 10,857.20, at the high of the day. November's industrial production number was revised up to 1% from the previous 0.8% number.

According to one report, a Japanese official said that he didn't agree that the U.S. wanted a strong dollar, and the dollar declined against the yen. Regional exporters gained, and carmakers performed well, too, after European sales figures proved strong for Japanese carmakers. Banks climbed, despite more information circulating about the massive IPO planned by U.S. investor-owned Shinsei. When news of that IPO first began circulating, banks dipped on fears that investors would dump their bank stocks in favor of the IPO on the profitable bank. Many techs regained some of their losses incurred after Intel's report, and Sony continued its recent gains. A Wall Street Journal article that NTT DoCoMo and Nextel Communications had spoken to AT&T Wireless about an acquisition or merger sent NTT DoCoMo higher. A report that retailer Seiyu would let 25% of its full-time workers go sent that company's stock lower, but by the end of the day, it had trimmed earlier, deeper losses. The company is a Wal-Mart affiliate. The Bank of Japan will begin a two-day meeting in Monday, but market watchers do not expect a change in rates.

Other Asian bourses traded in a mixed pattern. The Taiwan Weighted was flat, up 0.09%, but South Korea's Kospi gained 0.27%. In South Korea, Samsung continued recent gains and Hyundai Motor gained after revealing a strong figure for projected 2004 sales. Singapore's Straits Times gained 0.38%, but Hong Kong's Hang Seng dropped 0.62%. China's Shanghai Composite gained 0.88%.

Currently, European bourses trade higher, with some reaching new relative highs. The euro weakened against the dollar, and GE's earnings report was also credited with propelling the European indices higher. Techs and insurers gained in early trading, with ASML improving after yesterday's earning's report. Nokia was one of the gainers, with the company announcing a contract with IBM and plans to reduce employees in one of its units. Other gainers in the telecom sector were Alcatel and Ericsson, with those gains at least partially credited to Juniper's earnings announcement yesterday as well as to news specific to each company. Other European stocks in the news were German bank Commerzbank, disputing an article that said its talks with German banking rival HVB had fizzled; insurer Allianz, reporting that it would reduce its stake in insurer Munich Re; and French drug makers Aventis and Sanofi-Synthelabo, apparently engaged in possible merger talks. Commerzbank was rebounding from earlier losses while the others were seeing strong gains.

As of this writing, the FTSE 100 was up 18.30 points or 0.41%, at 4474.40. The CAC 40 was up 35.91 points or 0.99%, at 3662.88. The DAX was up 43.62 points or 1.07%, at 4112.37.

  Jeff Bailey   1/15/200,  10:29:27 PM
Per this evening's Index Trader Wrap and quick discussion of Dow Industrials (INDU) point and figure chart, and "trap" type trade we want to be looking out for. Look at the INDU chart here Link

and make the observation of how the Nikkei-225 ($NIKK) Link has been trading of late.

This is what we want to be alert to as it relates to supply/demand.

  Jeff Bailey   1/15/200,  9:27:34 PM
Pivot Matrix for tomorrow at this Link

  OI Technical Staff   1/15/200,  9:10:44 PM
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