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  Jeff Bailey   1/30/200,  6:21:01 PM
Pivot Matrix for next week at this Link

For the third WEEK in a row, there's that QQQ $38.26 level. For 01/19-01/23 it was $38.27, but pretty close.

I'd have to think that's a resistance level this week for the QQQ. Bugger shows up at MONTHLY R2 also.

What's that trader thinking with those Feb $37 puts sold for $1.25? I still think its an institution selling some puts against a short in the QQQ above $38.25.

 
 
  Jeff Bailey   1/30/200,  5:13:10 PM
Closing Internals at this Link

 
 
  Jeff Bailey   1/30/200,  4:47:23 PM
Weekly MM trades at this Link

Note: LSI Logic (LSI) $10.29 is recorded as both a DAY and SWING trade based on 15:52:01 comments and notes.

 
 
  Jeff Bailey   1/30/200,  4:21:10 PM
St. Jude Medical (STJ) $71.85 +0.13% Link ... just seeing an e-mail question regarding "what is STJ's bullish vertical count?" I came up with $71.00.

$53+((6*3)*1) = $71.00

$53 is the base of the bullish count column ($53-$58)

6 is the number of X in that column

3 is the BULLISH vertical count muliplier (bearish counts muliplied by 2)

1 is the box increment, or scale on the right of the chart.

Is this an important observation? It might be. What was a prior bullish count for STJ. Check out that column of X from $33-$42, which was a bullish vertical count established in January of this year.

Note: Stocks can meet and exceed their bullish and bearish vertical counts. Sometimes never meet this objective. However, the bullish and bearish vertical counts can be used for assessing a longer-term risk/reward profile.

Research in Motion (RIMM) Link slightly exceeded its bullish vertical count (Xs from $11.50-$14.50) of $22.00.

 
 
  Jane Fox   1/30/200,  4:04:00 PM
I second that Linda.

 
 
  Linda Piazza   1/30/200,  3:57:53 PM
I don't know about the rest of you, but I personally will be glad to see the last two days finished, and move on to fresh trading conditions next week.

 
 
  James Brown   1/30/200,  3:57:41 PM
Optical Communication Products (OCPI) is a little known fiber optics/networking stock. Shares are up big today (+17%) to $4.55 after its earnings report and an upgrade, which included a new price target of $5.10. Volume is very strong.

 
 
  Jim Brown   1/30/200,  3:57:17 PM
Earnings for Monday:
Before the open: ACDO, AGYS, ASCA, ANDW, BSX, CK, ETR, GCI, GW, HUM, IP, PCAR, QSII, RDWR, SPF, TWTC

After the close: AFL, ATRS, ATAR, AVNX, DNB, EDMC, RE, FMC, FMKT, HYDL, INCY, JCOM, JP, NFS, NKTR, ONNN, OMI, PBI, PPDI, PFG, DSS, SOHU, SFN, SRX, TASR, VMC, ZRAN.

 
 
  Jeff Bailey   1/30/200,  3:56:49 PM
SOX components ... here's quick look at SOX components and recent trade for 5-days and 20-days. Link

Today's winners NVLS Link and NSM Link

LSI Link maybe middle of the pack today.

BRCM the loser Link

Doesn't this kind of give the impression of some short covering or bullish pullback buying, while BRCM suggests some profit taking.

 
 
  Jeff Bailey   1/30/200,  3:52:01 PM
LSI Logic (LSI) $10.28 +0.88% ... for those that might not mind, if LSI does not trade my bearish stop of $10.35, with stock so near this stop, I would suggest holding over the weekend, if this does not violate your trade discipline of ending flat each day.

I will stick with the $10.35 stop, but with SOX showing some intra-day resistance, which may be coming from the 50-day SMA, I'd look to hold this day trade until Monday.

I checked the earnings calendar for Monday, and I do not see a semiconductor stock reporting quarterly earnings.

There are no earnings scheduled after today's close either.

 
 
  Linda Piazza   1/30/200,  3:48:58 PM
The OEX is above the 560.73 area that had capped its movements over the last few hours. It looks ready to challenge that 60-minute 100-pma now. I wouldn't expect it to be able to easily clear that important average, but who knows what could happen if we should see a burst of short-covering or real buying into the close. Since we're so close to the end of the day, however, in my mind, I'd still characterize this day as one in which the OEX continually tested its 60-minute 100/130-pma's, unless the OEX were to fall sharply.

 
 
  Linda Piazza   1/30/200,  3:40:57 PM
The OEX appears to want to head up toward the 60-minute 100-pma and the 60-minute 21-pma, now in close proximity at 561.87 and 562.18. Actually, I may be a bit premature in making that statement, however, since the OEX is now challenging that 560.73 level that had been the high over the last five (now six) hours. It has to get firmly above that level first.

 
 
  James Brown   1/30/200,  3:38:40 PM
Whoops! Looks like ANPI split early. The company had previously announced a 2-for-1 split but it wasn't due to take affect until next week. The record date isn't until Feb. 3rd.

 
 
  Linda Piazza   1/30/200,  3:30:18 PM
Let's talk about the daily chart and weekly OEX chart, since the intraday ones just show a lot of squiggling around in a congestion zone. The daily chart shows oscillators that have been tugged firmly out of territory indicating overbought conditions. The bar chart shows a sharp break below the recent high and the 562-563 support, with that sharp break followed by rectangular consolidation at the bottom of the decline--a probable "b" distribution pattern that will break to the downside. Last week's weekly candle was a doji at the top of a climb, and many expected to see a confirming tall red candle that moved down from that high for this week. Instead, this week's candle is likely to be a second potential reversal signal, a red candle with a tall upper shadow and not much lower shadow. There is of course a danger to those with bearish hopes that the OEX will merely consolidate sideways while those daily oscillators complete their downward trajectory. The TRAN's sharp fall argues against that conclusion, for the Dow at least, but we can't extrapolate the TRAN's action out to all the indices.

 
 
  Linda Piazza   1/30/200,  3:16:33 PM
The OEX was turned back at central Keltner resistance, now at 560.67, just below the high that has held for the last five hours. This is just more squiggling around for now, but the OEX heads back up to give it another try.

 
 
  Linda Piazza   1/30/200,  3:10:15 PM
The QQQ's have just closed the first five-minute period above the well-defined H&S neckline since falling below that neckline at the 2:00 candle. Now any QQQ short-term bulls who might have held on during that trendline break (including me, although I didn't intend to do so--my trading screen froze) want to see a quick zoom up to show that the formation is really being rejected and not that the NDX is just continuing to squiggle around in a congestion area.

 
 
  James Brown   1/30/200,  3:09:24 PM
Another stock to watch for earnings next week is Whirlpool Corp (WHR). Shares failed at resistance of $80 last week, pulled back to support at $74 and bounced. Earnings are expected on February 3rd. Considering the big number of homes built and sold last quarter earnings should be strong.

 
 
  Linda Piazza   1/30/200,  3:07:44 PM
For the last five hours, the OEX high has been 560.73, so a move above 560.75 would represent a break out of the middle-of-the-day consolidation range.

 
 
  James Brown   1/30/200,  3:05:38 PM
Options are a bit thin but shares of Philips Electronics (PHG) (actually Koninklijke Philips) have pulled back to the bottom of its rising channel and price support at $30.00 as well as its simple 50-dma. While the stock's technicals look tired this would be the entry point to buy at support. Personally, I think a bounce over 30.50 would be more comforting.

 
 
  Linda Piazza   1/30/200,  3:04:22 PM
The OEX remains in the bottom half of its nested Keltner channels, where it's spent most of the day. It's ringed round now with both Keltner resistance and Keltner support. Usually when that happens, we see a breakout one direction or the other, with the presumption being that it will be to the downside since the OEX trades on the bearish side of that central resistance. However, this steady trading has carried on for most of the day, and through most of yesterday, too, so it's possible it could continue longer, I guess. I keep being reminded of our move up late yesterday and the sharp short-covering rallies that have been characteristics of the Nikkei's last few minutes over the last few days of trading, wondering if that will happen on our market today, too.

 
 
  Linda Piazza   1/30/200,  3:00:19 PM
Those QQQ's are trying their best to get back over that H&S neckline. Several five-minute candles have pierced that neckline, but none have yet closed above it.

 
 
  Jeff Bailey   1/30/200,  2:58:51 PM
Intra-day chart of the SOX. Link

And yes... I now see that I profiled a day trade short in LSI right when the SOX was testing its DAILY Pivot.

TERRIBLE entry point alert. TERRIBLE!!!!

I can be criticle of my LSI entry point. I'm not so critcle of my QQQ stopping point as it was more difficult to identify a more exact stopping point earlier this morning. Still, when the QQQ showed strength above the MONTHLY R1, I really didn't feel it would trade below the morning low.

 
 
  James Brown   1/30/200,  2:52:37 PM
It's a bit cheap to play options on but Mobility Electronics (MOBE) is at a key support level. Shares topped out above $12.00 in early December and have since faded back to its simple 200-dma, which coincidentally is a 50% retracement of its big 2003 run up. Given the current trend MOBE may break this support and drift toward the $5.00 level.

 
 
  Linda Piazza   1/30/200,  2:51:39 PM
The OEX has spent the day testing its 60-minute 100/130-pma's, mostly from slightly over or slightly above its 130-pma. Early this morning, I thought we might be likely to see a countertrend bounce attempt up toward the top of the Keltner channels and toward the 100-pma, depending on how the economic releases turned out. After the disappointing GDP number, the resultant action led me to believe that instead of the measured distribution bounce we'd likely see a continued testing of the 60-minute averages. That's what's happened, and the 60-minute 21-pma now descends close to those averages, so that there's soon going to be a bearish cross of the short-term average over the longer-term average. That's usually a show-down time, with the usual resolution lately having been a break of the OEX above all the grouped averages. As I've been saying all day with reference to various chart developments, I'm not so sure that's going to happen this time.

 
 
  Jeff Bailey   1/30/200,  2:47:45 PM
Intel (INTC) $30.54 -1.16% ... did make a new session low of $30.35 at 02:15 PM EST, just below Red #6 of $30.37, but bounces back to Red #4 of $30.59 here.

This lower low has me thinking this morning's low wasn't "stop hunting" below yesterday's low.

 
 
  James Brown   1/30/200,  2:46:37 PM
The post-earnings sell-off in shares of SNDK had faded back to its 200-dma. Today's 4.4% decline breaks that support but SNDK may still have a last line of support at December's low near $53.00.

 
 
  Linda Piazza   1/30/200,  2:45:30 PM
Those QQQ's are edging back above that violated H&S neckline, but so far this is only a test. We're not seeing that zoom over it that tells us that the formation is being rejected. The QQQ's have a descending trendline that the QQQ's touched at the top of the current five-minute candle, at 37.17. Oops. The QQQ's slipped back below that neckline as I typed. We're still in the testing zone here with the outcome presumed but sure not known, as recent experience has taught us.

 
 
  Jeff Bailey   1/30/200,  2:43:31 PM
QQQ most active options at this point... March $36 puts 20,920 (OI=147,339), Feb $37 calls 15,632 (OI=170,056), Feb $37 puts 14,938 (OI=267,624).

That late session trade of 14,500 in the Feb. $38's looks bigger (size wise) than some might think. 14,500 in one swoop is pretty good size.

 
 
  Ray Cummins   1/30/200,  2:41:23 PM
Spreads/Combos/Premium Selling -- Market Movers: Overstock.com (NASDAQ:OSTK)

Traders who were waiting for another opportunity to sell "premium" in OSTK options certainly had their chance today as the stock dropped over 10% to $19.18 in a belated post-earnings retreat. On Wednesday night, the company said it lost $3.19 million, or 19 cents a share, on $57.46 million in sales in the quarter. That compared with earnings in the year-ago period of $995,000, or 6 cents a share, on $41.53 million in sales. So how do you justify a $4 million decline in earnings on a 40% gain in sales? Well, the CEO says much of the loss is due to advertising but apparently, that's not what investors wanted to hear and until they get an acceptable answer, this stock will likely suffer from continued selling pressure.

 
 
  Jeff Bailey   1/30/200,  2:40:12 PM
QQQ $37.11 -0.34% ...

SOX.X 513.27 +0.39% ...

Strrrrrrretch!

 
 
  Linda Piazza   1/30/200,  2:39:18 PM
The NDX and QQQ are both back above their daily pivots, with the QQQ testing the underside of its H&S neckline. I'm watching that neckline on the QQQ's rather than the NDX because it's a little better defined on the QQQ's. The presumption is that the QQQ's will get turned back again at that neckline, but I'm just not so sure about that. The break was a minimal one so far, and the five-minute oscillators are trying to turn back up as the QQQ's and NDX rise.

 
 
  James Brown   1/30/200,  2:29:18 PM
Looking for a financial to play? Check out GDW. Shares are once again trying to breakout over resistance in the $104 region. The stock actually hit $105.30 two days ago but couldn't hold it. After three months of consolidating under this level any breakout should draw some attention.

 
 
  Jeff Bailey   1/30/200,  2:25:48 PM
VXN.X 25.00 -0.79% ... not a lot of volatility at this point

 
 
  Linda Piazza   1/30/200,  2:22:03 PM
There's still a battle going on with the QQQ's, with those five-minute candles jumping all around. The pivot is being tested, this time from the underside.

 
 
  James Brown   1/30/200,  2:21:53 PM
Will it bounce? Navistar Intl Corp (NAV) has fallen six days in a row and is quickly approaching its simple 50-dma.

 
 
  Jeff Bailey   1/30/200,  2:18:06 PM
Day trade short alert ... LSI Logic (NYSE:LSI) $10.17 -0.19% here, stop $10.35, target $9.85.

 
 
  Ray Cummins   1/30/200,  2:16:28 PM
Spreads/Combos/Premium Selling -- Market Movers: Adobe Systems (NASDAQ:ADBE)

Software maker Adobe Systems is in "rally mode" today after the company said it expects favorable results for the first quarter due to strong worldwide sales of some of its core products. The company noted in a press release that "all of its major geographic markets are performing well." In addition, Adobe said it is "experiencing a strong global launch of its new Adobe Creative Suite and CS products, as well as continued success with its Adobe Acrobat product line." Adobe will report its fiscal first quarter results on March 18, so there is no chance of an earnings-related "surprise" in the near-term, however our bearish call-credit spread at $40 may be in jeopardy if the stock rises further in the coming sessions.

 
 
  James Brown   1/30/200,  2:16:19 PM
Defense stock Raytheon (RTN) might be offering an entry point soon. The stock sold off after its earnings report, breaking its narrow rising channel but now shares are approaching what should be support at $30.00 and its simple 200-dma and 40-dma. Bulls can look for the bounce, while bears will obviously be looking for the breakdown. Be careful, the early January low near $29.50 is close to the 38.2% retracement of its October-January run up.

 
 
  Jeff Bailey   1/30/200,  2:16:10 PM
Swing trade bullish stop alert ... QQQ $37.03

 
 
  Linda Piazza   1/30/200,  2:15:50 PM
I'm sitting here watching the QQQ five-minute candle bloom up to the violated neckline of the five-minute H&S formation and then sink back, forming a wick, and then doing it all over again. The base of that candle sits on today's pivot at 37.077. There's a battle between those buying the pivot and those selling the break in the H&S formation. I don't have a clue yet who is going to win. The charts suggest that those betting on the downside will, but recent history suggests otherwise. (Note: There goes the pivot, as I type.)

 
 
  Linda Piazza   1/30/200,  2:07:43 PM
The QQQ's are below their rather well-defined H&S neckline, but above the daily pivot and rising from that level. Hard to tell which to believe just yet, the minimal drop or the minimal bounce.

 
 
  Ray Cummins   1/30/200,  2:07:01 PM
Spreads/Combos/Premium Selling -- Market Movers: Gilead Sciences (NASDAQ:GILD)

The maker of the popular HIV drug Viread gapped lower today after the company said sales beat expectations in the fourth quarter, not due to demand, but rather from stocking up wholesalers' inventory. The company also told analysts to expect lower sales of its two key drugs this year and investors took that as a sign to unload the issue, hammering it $5 lower to $54.90. Conservative participants in our bullish credit spread were likely gone by Wednesday, when the stock moved below the sold (put) strike at $60, but for those aggressive traders who remained in the play, today's activity was certainly an unwelcome surprise.

 
 
  Linda Piazza   1/30/200,  2:03:48 PM
The NDX and QQQ are breaking through the neckline of their H&S formations, but remain just above their daily pivot, at 1489.86 for the NDX. I wouldn't consider that neckline break confirmed until there's a firm break of the daily pivot.

 
 
  Linda Piazza   1/30/200,  1:51:52 PM
Those QQQ's sure look as if they're in the process of completing a second right shoulder on the five-minute chart, now trying to rise from the neckline area again. It looks as if a drop through $37.11 would be a confirming neckline break, but it sure will be suspicious if it comes within this normal stop-running time of day, won't it?

 
 
  Ray Cummins   1/30/200,  1:44:44 PM
Spreads/Combos/Premium Selling -- On the "watch" list: Varian Semiconductor (NASDAQ:VSEA)

Shares of VSEA are among the most active on the NASDAQ today, up almost $6 to $49.75 after posting earnings of $4.8 million, or 13 cents a share, compared to $2.8 million, or 8 cents a share in the year-ago period. Mark FitzGerald, an analyst with Banc of America Securities, said VSEA's earnings were some of the best of any small-cap company in the chip-making tools industry. He also raised his price target on the stock to $36 from $29 but since that target is below the stock's current value, he maintained a "sell" rating on the shares. Hmmm, an upgrade with a "sell" rating...that's one I haven't seen lately. In any case, our "earnings speculation" play in VSEA is definitely on the "watch" list with the issue just pennies below the sold (call) strike in the bearish credit spread. With heavy overhead supply at this level, aggressive traders may have some patience with the exit transaction, however conservative players should consider closing the position on any further upside movement.

 
 
  Linda Piazza   1/30/200,  1:39:51 PM
Here's what I'm watching on an NDX 60-minute chart: Link

 
 
  James Brown   1/30/200,  1:39:23 PM
Ouch! It's going from bad to worse for shares of Winn Dixie (WIN). The company had already been slowly fading as investors worried about growing competition. Now the stock is down 28% to $6.51.

Same-store sales were down 6.6% in Q1 and -6.8% in Q2.
The company reported earnings that were 1 cent vs. breakeven.
The company has suspended quarterly dividends indefinitely.
S&P has placed the company on creditwatch negative and downgraded it rating.

 
 
  Linda Piazza   1/30/200,  1:35:33 PM
We're entering the usual stop-running time of day, from 1:35-1:55.

 
 
  Ray Cummins   1/30/200,  1:32:07 PM
Spreads/Combos/Premium Selling -- On the "watch" list: Kohl's (NYSE:KSS)

As we come to the end of a volatile week, it's important to be aware of the more critical positions in the portfolio. One of the surprise "bullish" issues in recent sessions is KSS and today the stock is up another $1.03 at $44.43 on strength in the retail group. Kohl's was also the target of an upgrade yesterday as Oppenheimer analyst Bernard Sosnick recommended an "aggressive accumulation of Kohl's shares in anticipation of a rebound to the $50-$60 range." Though he acknowledged that sales "might be sluggish in some months," he noted that Kohl's is starting a 12-month period in which it will be comparing same-store sales data against relatively weak numbers. From a technical viewpoint, that optimistic outlook should boost the company's shares because the stock is oversold and due for a move back to an intermediate-term MA. With the first test of resistance near our sold (call) strike at $45, the bearish credit spread should be a relatively easy position to manage. Watch for a close above that price on increasing volume to signal an exit or adjustment in the play.

 
 
  James Brown   1/30/200,  1:27:36 PM
Bulls may want to keep an eye on YHOO. Yesterday's candle looks like a bullish "hammer" or a one-day reversal pattern. Thursday's low was also a bounce off its simple 50-dma. The stock is seeing a mild rally today after JPM upgraded the stock to an "over weight" and added it to its "Focus" list. JPM's price target is $56.

 
 
  Linda Piazza   1/30/200,  1:25:25 PM
The TRAN finally looks as if it's trying to steady after today's steep plunge. The last steadying for the index lasted only a matter of hours before it rolled down again, and that's always possible this time, too, but after a more-than-6% loss in as many days, I'd expect a more extended period of measured distribution as it rises to retest broken support. Support at 3000-3005 had been established through much testing, so I would expect that some attempt would eventually be made to rise toward that level again and confirm whether it's now resistance.

 
 
  Jeff Bailey   1/30/200,  1:19:49 PM
01:00 Internals at this Link

 
 
  James Brown   1/30/200,  1:17:57 PM
Borg Warner (BWA) has pulled back about $5.00 from its $98 highs and is down 1.6% today alone on a downgrade from UBS to "neutral". Shares have been exceptionally strong the last few weeks and will probably attract dip buyers as it nears round-number support at $90.00. Keep watch for its February 5th earnings report. I wouldn't be surprised to hear BWA management announce a stock split (even though the stock does not have any split history).

 
 
  James Brown   1/30/200,  1:06:23 PM
Gilead Sciences (GILD) reported earnings last night that beat by a penny and surpassed the revenue estimates but the stock is getting whacked for a 8.8% loss ($5.36 to $55.30) today. At least three big-name brokers have downgraded the stock in response to its earnings report.

 
 
  Linda Piazza   1/30/200,  1:04:57 PM
The OEX is right back in the congestion zone in which it spend most of its day yesterday. Like yesterday, it has spent the morning trading within a neutral zone according to Jeff's 5MRT system. On the 60-minute chart, it's continued to spend the day testing the 100/130-pma's, with most time spent down near the 130-pma rather than higher, at the 100-pma at 562. At one moment, the 60-minute indicators appear to be cupping up into a more bullish stance, and the next time I study them, they've hooked down again, but they're currently in the trying-to-be-bullish mode. The advdec line has flattened. TRIN has, too. Something should change soon, but will it?

 
 
  Jeff Bailey   1/30/200,  1:04:20 PM
Tweeter Home Ent. (TWTR) $10.38 -1.61% ... opened at $10.38 and has traded a low/high of $10.31-$10.46.

One could say "this bird is caged" today.

 
 
  James Brown   1/30/200,  1:00:19 PM
The XAL airlines index is down 2.4% lead by a 9% decline in shares of Delta (DAL) after CSFB cut them to an "under perform". Shares of DAL are breaking eight-week support at $11.00 but holding at older support in the 10.50-10.25 range.

Another loser in the Airline sector is JBLU. Shares are down 3.1% today after Deutsche cut it to a "sell" this morning. The stock broke down a couple of days ago after reporting earnings that were in-line with estimates. A move to $20.00 would not be a big surprise here. The stock has dropped more than 50% from its October highs.

 
 
  Linda Piazza   1/30/200,  12:58:27 PM
The NDX is now up to the right-shoulder level on its H&S formation, but it hasn't yet zoomed above that level, as the SOX did earlier today with a similar formation. It has, however, moved above the descending trendline that formed off the head and first right shoulder, showing short-term strength from that measure alone. It's in danger of printing a lower five-minute high here, though, complete with bearish price/stochastics divergence, unless it moves above 1498.12 before turning down again.

 
 
  Jeff Bailey   1/30/200,  12:53:51 PM
NASDAQ-100 Heatmap (NDX.X) at this Link

 
 
  Jeff Bailey   1/30/200,  12:52:11 PM
Added some OEX tables to my 12:43:25 post. Gainers and losers. Both ends of today's inchworm.

 
 
  Jeff Bailey   1/30/200,  12:43:25 PM
Top 1/3rd of OEX at this Link

Sorted by market cap, which the OEX 560.00 -0.54% is weighted by.

The observation I get from this is institutions aren't doing a heck of a lot of aggressive buying so far.

Here's top 1/3rd gainers for OEX today. Link

Here's top 1/3rd of loser for OEX today. Link

 
 
  Linda Piazza   1/30/200,  12:36:42 PM
Does the SOX chart Jeff just posted (see his 12:34 post) predict that the NDX will zoom past its right-shoulder level (see my 12:32 post) as the SOX zoomed past its right-shoulder level? Perhaps, although it's not looking as if that's what's going to happen. We have to watch and see, staying aware that SOX action sometimes leads the NDX and COMPX.

 
 
  Jeff Bailey   1/30/200,  12:34:24 PM
Semiconductor Index (SOX.X) here's an intra-day chart of SOX. Link

With QQQ $37.14 -0.26% back near its lows of the morning ($37.04) .. something's got to give. Either the SOX will pull higher, or the Q's are going to drag the whole mess lower.

 
 
  Linda Piazza   1/30/200,  12:32:31 PM
The NDX has a fairly well-formed H&S formation on its five-minute chart, with the NDX just now rising from the likely neckline level at 1492, perhaps into a second right shoulder. In recent times, we've watched these formations set up, only to have the index or stock in question zoom right up past the right-shoulder level. I'm watching to see if that's what happens this time, too, or if we'll see a divergence from that recent pattern and have the pattern confirm and then fulfill its downside target. If it confirms, the minimum downside target will be somewhere near 1478, just above yesterday afternoon's low.

 
 
  Jeff Bailey   1/30/200,  12:25:21 PM
Daily Pivot Matrix Here's our Pivot Matrix, where in the 11:00 Update, I colored the DAILY Pivot levels of trade. Link

 
 
  Jeff Bailey   1/30/200,  12:19:09 PM
Texas Instrument (TXN) $31.31 +2.35% ... Shoot... this is the semiconductor stock I should have played for the swing trade bullish for semiconductor representation as it relates to the Nortel (NT) $7.83 +19% news and market response.

 
 
  Jeff Bailey   1/30/200,  12:14:17 PM
S&P Banks (BIX.X) 349.25 +0.1% ... challenging morning high here. Also challenging its MONTHLY R1 of 349.45.

SPX 1,129.70 -0.38% ... still below MONTHLY R1 of 1,131.85.

OEX 559.56 -0.62% .... still below MONTHLY R1 of 560.61

OEX biggest market cap stocks... GE -0.94%, MSFT -0.85%, PFE -1.08%, XOM -1.85%, C -0.34%, WMT -0.78%, INTC -1.03%

 
 
  Jeff Bailey   1/30/200,  12:10:26 PM
12:00 Internals at this Link

Here's what the internals looked like for 12/11/03, 2-days after FOMC statement. Link

As a test or comparison, today's internals not nearly as bullish on the A/D line.

NH leadership weaker at the NYSE, but stronger today at the NASDAQ.

 
 
  Linda Piazza   1/30/200,  12:06:40 PM
If that was a bullish falling wedge on the OEX five-minute chart (see my 11:30 post), the OEX has now broken out to the upside, at least minimally. Yesterday, we saw an upside break of a bullish formation that was immediately turned back, the opposite action of that we've grown accustomed to seeing, so watch for a new five-minute high to confirm. It's now at the 60-minute 130-pma, facing more overhead resistance, so this is just squiggling around as of yet.

 
 
  Jeff Bailey   1/30/200,  11:59:27 AM
SOX 515.27 +0.77% ... trying to move above that "right shoulder" I mentioned earlier on 5-minute bar chart. Might bring in some short covering. Will have to see. Session high has been 516.77.

Intel (INTC) $30.55 -1.13% ... Low/high has been $30.41-$30.99

 
 
  Linda Piazza   1/30/200,  11:56:44 AM
The NDX five-minute candles are absolutely squeezed into tiny marks on the chart, with those tiny marks in the center of the lined-up-perfectly nested Keltner channels. Something is going to change soon, but I'm not sure which direction.

 
 
  Linda Piazza   1/30/200,  11:52:40 AM
The advdec line has been steadying off for the last 45 minutes, and is trying to cautiously rise. It's nothing to shout about yet, but I just keep watching it.

 
 
  Linda Piazza   1/30/200,  11:43:30 AM
That 72-ema didn't have much effect on the $TRAN today, although it did pause for a while at that average, so perhaps it did have some small effect. The TRAN has plummeted again today, and is currently at 2890.34 as I type, with that general level being a level of recent historical support. I watch the TRAN because its action is sometimes a leading indicator for Dow action. I'm watching to see if the TRAN steadies off here at this historical support and if it then commences a bounce. Nothing much has stopped it yet, but it's had a monster decline in a matter of days, and at some point we should get some sort of measured distribution pattern while those losses are digested.

 
 
  Linda Piazza   1/30/200,  11:30:02 AM
The current five-minute OEX pattern is difficult to read. Is that a falling wedge, a pattern that's actually short-term bullish? Is it a bearish right triangle (horizontal support, descending upper trendline) that's already been broken to the downside, which is obviously a bearish development? Depending on your outlook, you could interpret that pattern either way.

Note: According to Pring, at least, the difference between a wedge and a triangle is that in a wedge, the lines are moving the same direction. So a wedge would have two falling lines, say, that converge at some point, or two rising lines that converge.

 
 
  Jeff Bailey   1/30/200,  11:18:20 AM
Intel (INTC) $30.46 -1.35% .. there may be some stop loss hunting going on by market makers, but still some DIVERGENCE to 12/10-12/15 trade. I did same type of comparison for INTC last night (thus on my trade list for today) as I had in the QQQ.

 
 
  Jeff Bailey   1/30/200,  11:15:14 AM
SOX ... 511.45 +0.03% ... a little head/should top pattern on the 5-minute chart. Objective looks like yesterday's lows. With INTC falling below yesterday's low, SOX may be vulnerable here

 
 
  Jeff Bailey   1/30/200,  11:13:42 AM
Swing trade Stop alert ... Intel (INTC) $30.49 -1.3% ..

 
 
  Linda Piazza   1/30/200,  11:12:55 AM
On the NDX, although not yet on the OEX or the Dow, the nested Keltner channels are starting to line up in an equilibrium position. We can and do see that position maintained for an hour or so, but it usually precedes a strong breakout. It's difficult at this point to assess which direction the breakout might occur, as the NDX has been rising, but probably rising in a bear flag formation, and rising into resistance. Since the NDX is the first to reach that equilibrium position, however, it also might be the first to break out (if you exclude the TRAN).

 
 
  Jeff Bailey   1/30/200,  11:12:30 AM
11:00 Internals at this Link

 
 
  Linda Piazza   1/30/200,  11:05:22 AM
I'm getting mixed pictures depending on what index I'm watching. I'm seeing the OEX continually challenging its 60-minute 100/130-pma's this morning, clinging to the lower of the two most of the day. I'm seeing it back below central Keltner support, so overall the picture is more negative than I expected to see today. That's causing me to add to my outlook of oversold bounce potential a possible continued-challenge-of-the-averages potential, with a possible breakdown at any time. The NDX is holding above that central support, however. The TRAN has plummeted since one day after achieving a new swing high on a closing basis, but that decline has been so strong that I expect it to steady off and rise in a measured distribution pattern at any time, with the current near-2900 level perhaps being an appropriate level at which that action might occur. Even on the NDX, though, I see the rise as a rise into resistance, a countertrend play. The formerly rising advdec line is now sinking again.

 
 
  James Brown   1/30/200,  10:53:09 AM
Our new OI call play in DHR has been triggered this morning with the move up and through the $91.00 level.

 
 
  Jeff Bailey   1/30/200,  10:53:06 AM
VIX.X 24.99 -0.67% .... keeping an eye on the VXN.X today based on that QQQ Feb. 37 put trade late yesterday. Want to keep a pulse on that trader.

 
 
  James Brown   1/30/200,  10:51:14 AM
MicroStrategy Inc (MSTR) is up significantly today (+14.5%) and breaking out above resistance at $60.00 after reporting earnings that were above estimates. First Albany is reiterating its "buy" and Wedbush Morgan is upping MSTR to a "buy". This looks like a 3-year high for MSTR.

 
 
  Linda Piazza   1/30/200,  10:51:01 AM
So far, the NDX (and QQQ's, of course) is holding above central Keltner channel support this morning as it currently pulls back from the day's high. The five-minute chart shows an index that has been climbing since 1:50 yesterday afternoon, climbing and then pulling back in a series of bull flags. This must be taken in its correct context, however, as the climb itself may be a bear flag climb into resistance, with Keltner channels showing that resistance at 1504-ish and then stronger up near 1519.70. That makes this a countertrend play in my opinion, but nevertheless, we're seeing the expected climb progressing as it should. At least, so far.

 
 
  Jane Fox   1/30/200,  10:49:54 AM
Linda (10:42 post) I would like to mention that I did not read the study, I only read about it, so I'm not sure how Sullivan calculated the 5%. But like you Linda I saw that using a fib retracement on any market definitely had more than a 5% retracement in the last 212 days so I just surmised that was how he was doing the study.

 
 
  James Brown   1/30/200,  10:47:39 AM
Yesterday I mentioned how General Motors (GM) was rolling over after breaking minor support at $52.50 and testing stronger support at $50.00 and its 50-dma. Now the stock is breaking down again after Goldman Sachs downgraded the stock to inline.

 
 
  James Brown   1/30/200,  10:45:36 AM
I mentioned Black Box Corp (BBOX) as being up 2.3%. Two weeks ago the stock exploded higher on a better than expected earnings report. Now profit taking has brought the stock back towards previous resistance now new support near $50.00. The stock's bounce today might be a bullish entry point for aggressive traders. Momentum traders might want to see a move over $53.50-53.75 first.

 
 
  Jeff Bailey   1/30/200,  10:45:01 AM
Tranpsorts (TRAN) 2,897.88 -2.49% ... getting derailed.

 
 
  Linda Piazza   1/30/200,  10:42:58 AM
The TRAN has fallen from a high of 3090.07 on 1/22 to this morning's low of 2898.32, a drop of 6% in as many days. The TRAN at least has seen that 5% drop that some have wanted to see.

Jane kindly explained to me after the market closed that the 5% drop everyone wanted to see was 5% of the absolute value of the index, not a 5% retracement of a specific move. I said yesterday that the part of my brain that sent me into studying physics in college must have been shut off because I thought we'd had plenty of 5% retracements, and I was right about my brain, my focus only on retracements from a move and not on other possibilities. Thanks, Jane.

 
 
  James Brown   1/30/200,  10:42:13 AM
Nortel Networks (NT) is powering a big move in the NWX networking index (+2.14%). Shares of NT are up 19% after announcing a very strong earnings report last night.

Fellow networkers are enjoying some strength. JNPR +2.5%, LU +4.3%, BBOX +2.4%... CSCO seems to be languishing only up 2 cents.

 
 
  James Brown   1/30/200,  10:38:33 AM
Medical device maker Stryker Corp (SYK) is seeing some "sell the news" after it reported earnings this morning that were only in-line. Two brokers are defending the stock, which is down 3.5%, by reiterating their "buy" ratings, one analyst is downgrading SYK to a hold. SYK should have support near $85, just above its 50-dma. A bounce there would be a potential bullish entry point.

 
 
  Jeff Bailey   1/30/200,  10:36:50 AM
Current MM Trades I have open with current stops and targets. Link

 
 
  Linda Piazza   1/30/200,  10:34:29 AM
The advdec line has turned down.

 
 
  Linda Piazza   1/30/200,  10:33:22 AM
The OEX is back down at its 60-minute 130-pma again. This is looking more and more like a bear-flag rise into resistance. That means that we could continue to see a rise (the bounce I expected) but that it could break down at any moment and will likely break down before retracing more than 50% of the steep flagpole decline, at about 563.35.

 
 
  Linda Piazza   1/30/200,  10:29:15 AM
The QQQ's are above midline Keltner support. They're facing Keltner resistance at $37.45-37.50, and are looking as if they might pull back somewhat, but nearby support is gathering, too. If they can maintain a position above midline Keltner support, at $37.20, then they might be able to eventually rise toward the top of the Keltner channel, currently at $37.97. When an index violates the Keltner channel far to the downside, as the QQQ did yesterday, it's sometimes slung all the way back to the top of the channel. A move back to $38 seems unlikely based on the bar chart, however, as the 60-minute 100-pma intervenes at $37.71.

 
 
  Jeff Bailey   1/30/200,  10:28:58 AM
10:00 Internals at this Link

 
 
  Linda Piazza   1/30/200,  10:24:09 AM
The TRAN edges just below its day's low. This could be a stop-running test, but that five-minute pattern sure looks like a "b" distribution pattern. Since the TRAN sometimes front-runs the Dow, the way the SOX does the Nasdaq, it's important to watch.

 
 
  Linda Piazza   1/30/200,  10:21:01 AM
The advdec line has been generally climbing since 9:43, just before the 9:45 economic release. It's trajectory has been up since then.

 
 
  Jeff Bailey   1/30/200,  10:20:19 AM
Trader's alert ... While I've got alerts set at stops and targets, I do want to alert traders that I may not be able to sound alerts at levels discussed with other duties I have during the day. I will make every attempt to sound a stop or target alert though.

 
 
  Jeff Bailey   1/30/200,  10:17:39 AM
SOX 516.09 +0.93% ... session high has been 516.77. DAILY R1 ahead at 519.87. Morning pullback found some support at the WEEKLY S1 of 513.96.

 
 
  Linda Piazza   1/30/200,  10:16:55 AM
The OEX has now bounced soundly off its 60-minute 130-pma and is now at its 100-pma. As I mentioned this morning, a climb back above this average is considered a bullish development. I thought pre-market that we might get a bounce from the OEX's then-position above that average, although it looked in question as economic numbers were released today, and the outcome still remains in question in my opinion. Instead of that bounce, we might just get continued testing of these important averages, but let's see. My pre-market impressions tend to be better than my in-the-heat-of-the-fire ones, but it may be that we'll just get continued testing of resistance instead of a real bounce. I expected a lower high if we did get a bounce, making any bounce a risky countertrend move that could fall apart at any time.

 
 
  Jeff Bailey   1/30/200,  10:16:14 AM
Intel (INTC) $37.97 +0.25% ... "c'mon big dog, the SOX needs you."

 
 
  Jonathan Levinson   1/30/200,  10:16:06 AM
The first half hour's put to call ratio was .59, overweighted to the call side. Current VXO is up 1.17% at 17.31.

 
 
  Jeff Bailey   1/30/200,  10:14:57 AM
QQQ alert $37.36

 
 
  Jeff Bailey   1/30/200,  10:13:07 AM
Swing trade long alert ... QQQ $37.40 for trade at $37.36, stop $37.03, target $37.95.

 
 
  Linda Piazza   1/30/200,  10:12:15 AM
On Wednesday, the NDX fell below its 60-minute 100/130-pma's, and also plummeted through the bottom support of the descending regression channel in which it had been trading since 1/20. Today's action has brought the NDX back up to test that bottom support, presumably now resistance. That's at 1504, with a host of 60-minute averages grouped just overhead, too. The 21-pma, is at 1507.96, the 130-pma at 1511.68, and the more important 60-minute 100-pma is at 1516.91, as I type this anyway. This 100-pma is in congruence with the resistance area that Jane mentioned for the NQ, although I know we can't relate the futures and the cash market exactly. We could have expected a retest of the broken support. Actually, I thought we were going to get it yesterday. The presumed outcome is that the NDX will find resistance too strong at one of these levels or perhaps closer to 1520, but that's presumed only until it happens. As Jane has mentioned in the past, too, the tech-related indices tend to overshoot resistance or support sometimes.

 
 
  Jeff Bailey   1/30/200,  10:12:08 AM
QQQ $37.39 +0.38% ... sees 5-minute close above MONTHLY R1. If the bulls are going to drive'em, nows the time.

 
 
  Jeff Bailey   1/30/200,  10:09:15 AM
Sector action mixed ... Networking +2.03%, Telecom +1.47%, Semiconductor +0.78%

Airline -1.79%, Transports -1.44%, Biotechnology -1.15%

 
 
  Jeff Bailey   1/30/200,  10:07:07 AM
Buy/Sell Program Alerts active and alternating

 
 
  Linda Piazza   1/30/200,  10:06:11 AM
The advdec line has been climbing since just before the 9:45 number, but has now steadied off and begun to roll down. I'm watching the trajectory rather than the actual number. As that happens, the OEX has now rolled down to the 60-minute 130-pma, still within range to be testing that important average. This isn't showing strength, however, but we don't have a clear bearish picture, either, until and unless it firmly violates that average.

 
 
  Jeff Bailey   1/30/200,  10:05:21 AM
QQQ $27.28 +0.13% .... session high has been $37.38, but couldn't see a 5-minute close above the MONTHLY R1 of $37.36 at this point.

 
 
  Jeff Bailey   1/30/200,  10:02:50 AM
Alternating buy then sell program premium alerts ... SPX 1,130

 
 
  Jeff Bailey   1/30/200,  10:01:34 AM
SOX 516.57 +1.03%

 
 
  Jeff Bailey   1/30/200,  10:01:00 AM
Swing trade long alert ... Intel (INTC) $30.95 here, stop 30.49, target $31.98.

 
 
  Jim Brown   1/30/200,  10:00:09 AM
Chicago PMI = 65.9 , (est was 60.0, last was 59.2)

 
 
  Jeff Bailey   1/30/200,  9:58:06 AM
SPX 1,130.88 -0.28% ... edges back up, but just under its MONTHLY R1 of 1,131.85.

 
 
  Linda Piazza   1/30/200,  9:55:49 AM
Although I mentioned yesterday, when we were discussing the 72-ema on the daily chart, that non-tech stocks didn't tend to follow that average as closely as did some tech-related indices, the TRAN is one exception. It does seem to trade a bit more in accordance with this average, bouncing from its test of this average in April (after a day in which it closed beneath it) and again in June of last year. The TRAN sits squarely on that 72-ema right now, with that average at 2921.08. Here's a chart: Link As I mentioned yesterday, I started watching this by accident, somehow translating Jonathan's 72-sma on intraday charts into a 72-ema on my daily charts, but with some indices, it seems to have some validity. Just judge for yourself and make your own decision, as placing this MA on my charts was essentially due to an erroneous impression on my part.

 
 
  Jonathan Levinson   1/30/200,  9:55:08 AM
A weekend repo of 3.5B has just been announced, draining net 2B against the 3.5B expiring.

 
 
  Jeff Bailey   1/30/200,  9:53:37 AM
QQQ $37.22 -0.05% ... I've got the 5-MRT on the QQQ. Blue #2 at $37.35 is correlative with MONTHLY R1 of $37.36.

In my opinion... this is the level, which if above, is signal of strength. I will also note that the extension of our March upward trend is also right there.

 
 
  Jim Brown   1/30/200,  9:52:05 AM
Massive bad tick on GE to a low of $3.81

 
 
  Jim Brown   1/30/200,  9:48:10 AM
Michigan Consumer Sentiment final revision = 103.8 (last 103.2)

 
 
  Jeff Bailey   1/30/200,  9:48:05 AM
Semiconductor Index (SOX.X) 512.93 +0.32% .... NSM +3.35%, TER +2.19%, NVLS +1.44%, XLNX +0.82% ....

STM -1.4%, TXN -0.65%, KLAC -0.59%, ALTR -0.35%

 
 
  Linda Piazza   1/30/200,  9:46:19 AM
The OEX now tests its 60-minute 130-pma. It's bouncing minimally from that average, but it certainly hasn't climbed back above the 100-pma as yet. On a five-minute chart, it's violated the bear flag that formed as the OEX rose off yesterday's low, and it looks as if we're getting the expected bounce up to test that broken support.

 
 
  Jeff Bailey   1/30/200,  9:43:53 AM
Tranpsorts (TRAN) 2,920 -1.59% ... really getting hit hard and gap down from a rising 50-day SMA.

This is NOT a good sign for broader market bulls in my opinion.

TRAN components YELL -11.7% Link , DAL -6.57% Link , USFC -2.61% Link pace decline.

 
 
  Jeff Bailey   1/30/200,  9:42:41 AM
Sector weakness ... Airline -1.79%, Transports -1.62%, Biotech -1.71%

 
 
  Jeff Bailey   1/30/200,  9:40:54 AM
Networking Index (NWX.X) 301.67 +0.91% .... one of just three equity sectors showing gains.

Telecom (IXTCX) 194.86 +0.43% and Gold Bugs ($HUI.X) +0.23%

 
 
  Linda Piazza   1/30/200,  9:40:40 AM
On a Keltner channel basis, at least, there's not much support between the current OEX price and yesterday's low. There's light support at 558.64 and then stronger support at 557.12.

 
 
  Jeff Bailey   1/30/200,  9:38:18 AM
SPX 1,130 -0.38% ... comes back below its DAILY Pivot of 1,130.29. DAILY S1 lower at 1,126.20.

 
 
  Linda Piazza   1/30/200,  9:37:31 AM
During the first five minutes of trading, the OEX spanned a range from 563.22 to 561.12, with the midpoint at 562.17, and with the OEX currently below that midpoint, showing weakness in earliest trading. I hesitate to draw too many conclusions this morning ahead of the economic numbers soon to come, however, but this downturn below the 60-minute 100-pma blows a hole in the possible bounce theory, since it was predicated on that close above that average. How big a hole it is, and whether the wind can still hit those sails remains to be seen.

 
 
  Jeff Bailey   1/30/200,  9:37:22 AM
Express Scripts (ESRX) $69.19 -0.43% ....

 
 
  Jeff Bailey   1/30/200,  9:36:51 AM
Tweeter Home Ent. (TWTR) $10.38 -1.61% ...

 
 
  Jeff Bailey   1/30/200,  9:34:57 AM
SOX 510.87 -0.08% ... comes back below its DAILY Pivot

QQQ $37.13 still above its DAILY Pivot of $37.07.

 
 
  Linda Piazza   1/30/200,  9:34:19 AM
The OEX has immediately turned down to retest its 60-minute 100-pma, currently at 562.16, falling below it as I type. A plunge beneath the 130-pma at 560.08 would be ominous.

 
 
  Jeff Bailey   1/30/200,  9:32:46 AM
Semiconductor Index (SOX.X) 511.57 +0.05% ... QQQ $37.16.

 
 
  Jeff Bailey   1/30/200,  9:32:19 AM
S&P Banks (BIX.X) 348.05 -0.23% ... SPX 1,131.89 -0.19% and OEX 561.61 -0.26%.

 
 
  Jeff Bailey   1/30/200,  9:29:58 AM
Quick thoughts on Q4 GDP ... today's data should have the Fed and investors thinking the Fed isn't going to be pressed to raise its fed funds rate anytime soon. While the advanced Q4 GDP most likely gets revised higher, the economy does appear to be growing at a more sustainable pace as the Fed had thought.

 
 
  Jeff Bailey   1/30/200,  9:21:29 AM
09:00 Update at this Link

 
 
  Jane Fox   1/30/200,  9:21:20 AM
John Thain, chief executive of the NYSE, is considering using an electronic system to automatically match investors' stock orders that represent the best prices to buy and sell shares at a given time. Such a system would enhance the floor's current trading technology, which permits the automatic execution of small stock orders but leaves the large ones to individual specialists. This move would represent a significant shift for the 211-year-old exchange, the last remaining major stock exchange that has humans on the floor handling most trading.

 
 
  Linda Piazza   1/30/200,  9:13:37 AM
Yesterday's late-day bounce in the OEX resulted in a small-range white candle that did not retrace more than 50% of the previous day's tall red candle, but did hook the RSI back up again. That indicator is always one of the first to react, giving us early warning of strength or weakness, but it can be fickle, trading sensitivity for occasional false signals. The late-day move in the OEX did bring it back above its 21-dma, however, producing a close above that moving average. It also drove the OEX back above its important 60-minute 100-pma, an average that has been important in OEX trading over the last few months. The last time the OEX touched the 100/130-pma's and then rose back above the 100-pma was December 10, when that 100-pma was at 523.21. We all know what happened after that. In mid-January, the OEX descended toward the 100-pma then at 551, but didn't even touch it before it was off again.

The OEX has looked weaker this time in its test of the 100-pma, however. This time, the OEX actually fell below the 130-pma for a number of 60-minute candles before it hauled itself back above the 100-pma again. This time, the envelopes slope down. Although my backtesting of envelopes showed that we can't always draw conclusions about likely action based on the slope of the envelope when it's touched, that still does show us one sign of possible weakness. I also note that while the OEX closed above the 60-minute 100-pma, it did not close above its 30-minute version and still faces that at 564.75. In addition to climbing back above its 60-minute 100-pma, the OEX climbed back above its central Keltner support, so that it's now in the upper half of its Keltner channels. That climb was a tentative one, a scramble at the end of the day, and the OEX faces immediate Keltner resistance near 563.50.

The conclusion? The conclusion right now is that we still await important economic information early in the trading day, and I'd hesitate to draw too strong a conclusion ahead of the open of trading, those economic numbers, and a look at the TRIN and advdec line. Right now, it's looking as if the OEX might try to rise, but I'm thinking a lower high, not a new high.

 
 
  Linda Piazza   1/30/200,  8:54:03 AM
At the close of trading yesterday, I'd speculated on how the Nikkei might trade overnight. It looked primed for a bounce after a four straight down days, with the Nikkei having touched support intraday Thursday and then bounced strongly from that support. The pattern looked as it might be a possible H&S forming at the top of a rise, which suggested that the Nikkei could be getting ready to rise into a right shoulder. In addition, the Nikkei had seen a strong bounce at the close of Thursday's trading, and I thought that upward momentum might carry through into early trading, at least. I mentioned, however, that currency issues tended to impact that export-driven economy hard. The Nikkei did see a strong bounce in early trading, but those currency issues came back to haunt the index, with the bourse not able to maintain the highs of the day. Articles mentioned those currency issues, with many fearing that current strong earnings reports would be degraded by the effect of the rising yen in future quarters. The Nikkei closed flat, again on a burst of short-covering into the close. In doing so, however, it created yet another potential reversal signal, a small-bodied high-wave candle at the bottom of a decline. This isn't an index that is showing particular strength on a short-term basis, but is one that's showing the possibility of a bounce next week. It remains only a possibility so far, however, and my best guess at this time is that any bounce will result in a lower high, and probably a lower high that forms the right shoulder of a H&S formation.

 
 
  Jonathan Levinson   1/30/200,  8:31:20 AM
8:30am U.S. Q4 FINAL SALES UP 3.4% VS. 8.3% Q3

 
 
  Jonathan Levinson   1/30/200,  8:30:51 AM
8:30am U.S. Q4 GDP 4.0% VS. 8.2% Q3

8:30am U.S. Q4 GDP 4% GROWTH MISSES 4.9% EXPECTATIONS

 
 
  Jonathan Levinson   1/30/200,  8:11:47 AM
We await the following data at 8:30: GDP Q4, est. 5%, Chain deflator Q4, est. 1.3%. At 9:45, Michigan Sentiment est. 103, and at 10AM the Chicago PMI est. 62.1.

 
 
  Linda Piazza   1/30/200,  7:20:31 AM
Good morning. The Nikkei opened slightly in the red in Friday's trading, but with December's jobless rate falling to an unexpectedly low 4.9% and TDK Corp raising its 2004 earnings forecast, the Nikkei soon climbed almost to 10,850. That was to be the high of the day, however, as the Nikkei fell, then reached a lower high, fell again, and then climbed 60 points in the last few minutes of trade, closing barely positive. The Nikkei closed up 4.17 points or 0.04%, at 10,783.61.

Economists had predicted no change in Japan's unemployment rate, so the decrease was an encouraging sign. December's core consumer prices were flat from the year-ago level in December, however, with improved hiring by manufacturers not yet resulting in higher consumer prices. Core consumer prices fell a total of 0.3% in 2003. January's core prices in Tokyo fell 0.3% from the year-ago level and 0.2% from December's level.

TDK mentioned increased demand for digital electronics when it raised guidance. The focus turned to other companies reporting earnings, too, such as securities firm Nomura, which missed estimates due to lower profits in bond trading, and Daiwa Securities, a securities firm that missed profit estimates. Brokers turned down under the pressure of the two misses. Nintendo said that currency issues would reduce profits by 20%, and the company's stock tumbled 6.7%. In the end, though, it might have been currency worries that knocked the Nikkei back from its high of the day, with technology stocks erasing earlier gains as investors took profit, reportedly worried about the effect of a strong yen on future earnings. Automakers declined, perhaps due to those same currency-related issues, but also due to jitters over an after-the-bell earnings report in Honda's case. Honda reported a record quarter. Some articles this week have begun mentioning the typical sell-off in banks' stock holdings in February and the impact that it might be having on the Nikkei, too.

Other Asian bourses turned in mixed performances. The Taiwan Weighted gained 0.99% even though Taiwan Semiconductor succumbed to profit taking after reporting increased demand from cell-phone companies for its chips. South Korea's Kospi lost 0.58% despite seeing December's industrial output grow 10.4% from the year-ago level and 2.7% from November's level. SK Telekom rose after reporting a big jump in net profit, but Samsung Electronics and Hyundai Motor fell. Singapore's Straits Times climbed 0.33%, but Hong Kong's Hang Seng dropped 0.33%. China's Shanghai Composite tumbled 2.34%.

Currently, European bourses also turn in a mixed performance, but the ones we typically watch trade higher. The first French IPO in three years debuted today. French Internet service provider Iliad saw strong demand in that debut. On the economic front, the news wasn't as cheery, as December's French unemployment rose to 9.7, and December's German retail sales slid 2.3% from November's level. Retail sales were down 2.5% for the year. These German retail numbers proved far below the expected forecasts of slight gains. Specific stock and sector stories saw Nortel Network's soaring sales send other networkers higher, too. Some telecom-related stocks were rising. Swiss temporary staffing firm Adecco, under fire since it announced that it was looking into accounting controls in its North American operations, jumped 12% after saying that it was finding only financially insignificant irregularities at the branch level and adding that it was seeing increased demand for its services. Despite today's gains, Adecco's stock remains far below the level at which it traded before announcing the investigation. Puma AG shares rose after reporting earnings that beat expectations and giving an upbeat forecast for 2004's sales, but Adidas-Saloman dropped after reporting a 14% increase in net income but saying it expected 2004's growth to be slower.

Currently, the FTSE 100 has gained 13.30 points or 0.30%, to trade at 4424.80. The CAC 40 has gained 19.30 points or 0.53%, to trade at 3681.60. The DAX has gained 13.52 points or 0.33%, to trade at 4109.23.

 
 
  Jeff Bailey   1/29/200,  9:28:46 PM
Pivot Matrix for tomorrow at this Link

 
 
  OI Technical Staff   1/29/200,  8:54:24 PM
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