Option Investor
Archive
HAVING TROUBLE PRINTING?
Printer friendly version
  Jeff Bailey   2/11/200,  6:24:36 PM
Pivot Matrix for tomorrow at this Link

 
 
  Jeff Bailey   2/11/200,  5:25:08 PM
Closing Internals at this Link

 
 
  Jeff Bailey   2/11/200,  4:20:19 PM
Current Market Monitor trade review at this Link

I'm recording BGO day trade as closed at $3.40 (closing bid/ask $3.40 x $3.41)

and carry BGO as swing trade with entry at $3.40. I have further raised the BGO swing trade target to $3.69, but will keep stop at $3.32.

 
 
  Jim Brown   2/11/200,  4:04:31 PM
Earnings after the close:

BRCD est +0.02, act = +0.03 beat
INVN est +0.30, act = +0.34
CSC est +0.70, act = +0.68 (.03 charge)guided low
MDT est +0.40, act = +0.40 ex items
WFMI est +0.57, act = +0.60
YUM est +0.62, act = +0.65
RNBO est +0.12, act = +0.18

 
 
  Linda Piazza   2/11/200,  4:00:38 PM
Good afternoon, everyone. See you tomorrow morning with the early-morning report on the Asian markets and European markets. The Nikkei will be open for trading after today's national holiday.

 
 
  Jeff Bailey   2/11/200,  3:57:29 PM
BGO $3.40 x $3.41 .... 2.5 minutes to close.

 
 
  Jeff Bailey   2/11/200,  3:56:56 PM
BGO $3.40 x $3.40

 
 
  Jeff Bailey   2/11/200,  3:53:25 PM
Bema Gold (BGO) update ... $3.39 x $3.40 Link .... stock remains pegged at this level, and I have mixed thoughts on holding this one overnight, but with U.S. Dollar Index (dx00y) 85.19 -0.75% looking to close at lows of the session, a trader willing to take a chance on overnight hold, might be rewarded with a gap higher open.

Resistance in play is the rounding lower 50-day SMA. The 50-day SMA also in play on Newmont Mining's (NEM) $45.57 +2.86% Link chart.

 
 
  Linda Piazza   2/11/200,  3:49:17 PM
The OEX did find support again at the same level of Keltner support at which it had been finding support all day since the first zoom higher. The pattern was preserved although the OEX has not yet been able to make a higher high. Now all those in bullish plays have a tough decision to make. A lot of the measures by which I watch the OEX are showing it extremely overbought on a short-term basis, probably the most overbought on the Keltner channels that I've seen in the times I've been watching them. Keltner channels can give valid breakout signals, however, just as can Donchian channels. So, the risk of harvesting some gains this afternoon before the close is the risk that the breakout signal is valid and that the OEX will continue climbing tomorrow morning, at least early in the morning, perhaps up to that 575.50 upside target predicted by the double-bottom formation. Perhaps it will go higher, although several methods show upside targets in that range before a retracement. The risk in not harvesting gains this afternoon is that tomorrow morning will be a pop-and-drop day or even a gap-down day as market watchers mull over Greenspan's testimony and find a few negatives despite the media depictions so far today, and that the retracement will begin.

 
 
  Linda Piazza   2/11/200,  3:41:04 PM
The TRAN has driven up all the way to the 50% retracement of the recent plunge, or within a point and half of that 50% retracement at about 2951.88, anyway. If the TRAN is able to move above and sustain levels above that 50% retracement (beyond any short-covering spree that might send it higher into the close), the bulls have gained ground. A typical retracement of a move is 1/3-2/3, according to Pring, with a 50% retracement being a common level at which the retracement fails. Therefore, it's a victory for bulls if the TRAN isn't turned back at that level. Above that 50% level, the 2985 level that represents a 61.8% retracement of the plunge is also historical resistance.

 
 
  James Brown   2/11/200,  3:27:13 PM
Another low-dollar play that might be worth watching is Sanmina-SCI Corp (SANM). Shares are bouncing from the bottom of their rising channel and tried to breakout over the $13.50 level today. Technicals looks bullish but traders might want to use a trigger over today's high at $13.55. Keep in mind that there is potential resistance at the $14.30 region from its gap up and gap down in mid-January.

 
 
  James Brown   2/11/200,  3:24:14 PM
A low dollar stock that bulls might want to watch is E*Trade (ET). The stock recently broke out from its short-term trend of lower highs, pulled back in profit taking and is now bouncing higher again. The stock is approaching resistance near $15.00 and multi-year highs.

The strength in the stock market is sure to drive trading volumes, which is crucial for online brokers like ET and AMTD.

 
 
  Linda Piazza   2/11/200,  3:22:57 PM
DD: I notice from studying the weekly chart, that despite broad market gains, DD has maintained its roughly 10-point trading range that's persisted since early 2002. DD tends to get itself into 10-point trading ranges, with a $40-50 range persisting for about a year before the big dip in the summer of 2001. After one more trip up to $50, DD then settled into a lower 10-point range from about $35-45. Early in January, DD briefly pulled above $45, but then headed down again. This time, though, DD has built a pattern of higher lows on that weekly chart, perhaps setting up a bullish right triangle with a horizontal top at $45 and a rising trendline under those higher lows. The stock may be getting ready to push above $45 again. If so, wait out the initial volatility and then look for DD to settle into another 10-point range. Stocks that trade in ranges tend to establish new ranges, just at higher or lower levels. If DD should manage to sustain levels above $50.00, however, it will have completed a rounding-bottom formation that predicts upside to about $67.00, and DD may trend instead of trade within that 10-point range. The P&F chart shows an upside price objective of $61.00 with DD currently in an "O" column.

 
 
  Jeff Bailey   2/11/200,  3:11:16 PM
Buy Prog. Prem. Alert

 
 
  Linda Piazza   2/11/200,  3:10:34 PM
If the OEX follows the form that it has all day, it's approaching the Keltner channel lines from which it will find support, from the current level down to 571.46, and it will then rise. If that doesn't happen, then the short-term pattern has changed.

 
 
  Jeff Bailey   2/11/200,  3:10:33 PM
Swing trade long alert ... Citigroup (C) $49.57 +1.3% here, stop $48.25, target $52.00.

 
 
  James Brown   2/11/200,  3:05:00 PM
Becky Quick on CNBC just mentioned KO as a Dow laggard. It's interesting to see that MMM is not participating in the rally (-14 cents) while other components like CAT are bouncing.

 
 
  Jonathan Levinson   2/11/200,  3:04:12 PM
> 2:57pm GM TIGER WOODS RENEWS AD-PACT WITH GM'S BUICK DIVISION

Well, at least *that* hasn't been recalled...

 
 
  James Brown   2/11/200,  3:01:31 PM
Jeff mentioned the SOX earlier. I'm happy to see the SOX semiconductor index is finally moving again after investors spent the last two days digesting Friday's big gain. The index's technicals suggest it could be bouncing back towards the top of its channel.

MXIM has really been enjoying the strength in the chips with another 3.6% gain today and a new buy signal in its MACD.

Another chip stock SLAB is also enjoying a big move today with a 5% gain to a new multi-year high.

 
 
  Linda Piazza   2/11/200,  2:59:13 PM
Some days, Jeff's 5MRT system works beautifully for the OEX, but sometimes it's not ideal for the indices. However, I decided to spend some time today backtesting some stocks picked at random from a Q-charts trade rate scan and see how they performed according to Jeff's 5MRT. Interested in seeing the results?

JNPR: bearish signal triggered at about 27.29 with downside target of 26.73, not yet met, although the bearish #5 was hit, which was kind of remarkable in today's market. The current five-minute chart pattern resembles a bullish right triangle, however, with the possibility that a bearish play might be stopped out near breakeven. Still a remarkable result for a bearish play on a day like today.

ORCL: After a minor violation of the bearish #2 (no five-minute close below it), ORCL rose and triggered a bullish play on a move through bullish #2 at 13.64. Upside target would be 13.97. That figure hasn't been met and there's a possibility now of a double-top formation, although before the last few five-minute bars, ORCL's performance had shown the climb, bull-flag pullback, climb pattern that daytraders would like to see. The double-top hasn't been confirmed and ORCL might still meet that upside target.

CHRS: Stayed completely within the neutral zone. No play triggered.

TIBX: Bullish play triggered with a move over 8.14, with the 8.40 upside target met.

ROIAK: Bullish play triggered with a move over 19.04 with the upside 19.44 target met.

Maybe I'll have to switch back to daytrading, as I used to do more than I do now.

 
 
  Jim Brown   2/11/200,  2:56:08 PM
HPQ just affirmed earnings for next Thursday at +0.35 cents. Revenue is expected to be in the $19.5 billion range and slightly ahead of estimates. Prior earnings guidance was +0.33 to +0.35 cents.

That should effectively kill my HPQ play from last night as it takes all the mystery out of the HPQ numbers for next week. It looks like HPQ was trying to steal some of Dell's thunder with the early announcement. Dell reports tomorrow.

The option had already doubled from last night's closing price of 40 cents so at least it was slightly profitable for anybody that took the play.

 
 
  James Brown   2/11/200,  2:53:59 PM
As Jeff mentioned earlier this morning Goldman Sachs (GS) was upgraded to a buy from a hold by Smith Barney who also raised their GS price target from $110 to $122. Shares of GS gapped open at the bell and never really looked back. Currently GS is up 4.45% on stronger than average volume. We're seeing similar moves in Lehman Brothers (LEH) who is enjoying a 6.3% gain and just broke above resistance at $86 to hit a new high. Merrill Lynch (MER) is also up 4.45% and approaching resistance at $61.00 on stronger volume. Morgan Stanley (MWD) is up 5.26%. Bear Stearns (BSC) is up 4.71% to another new high.

The rash of M&A deals means big money for these broker-dealers and Wall Street believes 2004 will produce a lot more mergers.

 
 
  Jeff Bailey   2/11/200,  2:50:24 PM
Buy Prog. Prem. Alert

 
 
  Jeff Bailey   2/11/200,  2:50:06 PM
U.S. Dollar Index (dx00y) 85.16 -0.79% ... (30-minute delayed quote) and sinking back near session low of 85.09.

 
 
  James Brown   2/11/200,  2:43:43 PM
A follow up on a few mining stocks...current OI call play (copper producer) PD is extending its gains, up 5.5%, on this morning's breakout.

FCX is breaking out over the $40.00 mark but still struggling under its 50-dma.

NEM is in a similar pattern...breaking out over the $45 level but still under its 50-dma.

GG looks tempting here, up 2.8%, breaking above resistance at $14.50. It still has its 50-dma at $15.19.

The XAU gold & silver index has just broken out above its 50-dma...

 
 
  Jeff Bailey   2/11/200,  2:42:21 PM
Sun Communities (SUI) $41.56 +1.11% ... keeping percentage pace with the INDU 10,736 +1.15% and SPX 1,157.54 +1.04%. NDX 1,512.45 +0.81% trying to keep up.

 
 
  James Brown   2/11/200,  2:38:50 PM
A follow up on the homebuilders...current OI call play DHI is looking very bullish here breaking out to a new high.

RYL...breaking out above $80 but still under resistance at 82.50 and 50-dma.

PHM...looks like a bullish play here. Shares are breaking out from a declining trend of lower highs as well as a breakout over resistance at $46.00 and 50-dma.

CTX... is breaking out over the $100 level but still under resistance.

BZH... looks good here...breaking out over the $100 mark and its 50-dma. Volume looks decent.

HOV +3.73%, TOL +3.21%, LEN +3.23%, KBH +2.59%

 
 
  Linda Piazza   2/11/200,  2:36:46 PM
OEX 571.09-571.41 is the zone to watch on this next pullback, although that zone will change as the minutes tick by. All day, the OEX has been bouncing from the version of Keltner support now offered at these levels. A failure to bounce this time from those same channel lines would show the first change in tenor.

 
 
  James Brown   2/11/200,  2:35:45 PM
Sector leaders this hour:

DJUSHB homebuilders: +2.96%
XAU gold & silver: +2.79%
XBD broker-dealer: +3.3%

Sector losers...

HMO healthcare: -2.28%

 
 
  Jeff Bailey   2/11/200,  2:35:15 PM
Semiconductor Index (SOX.X) 523.45 +1.27% ... just off session high of 524.87 and shy of its MONTHLY Pivot 525.90 and WEEKLY R1 528.71 zone of resistance.

Intel (INTC) $30.89 +1.17% may be benefiting more that Applied Materials (AMAT) $22.17 +0.59% with INTC's Dow membership.

 
 
  Linda Piazza   2/11/200,  2:30:10 PM
While the Wilshire has reached an equal or slightly higher high on the daily chart, the Russell 2000 has not, so perhaps we're seeing some of that rotation out of last year's hot stocks, the small caps, as Jim suggested we would see. When I look at the NDX and OEX, though, the bastions of the big caps, they're both lagging the Wilshire by this measure, too. I haven't figured out what's leading this latest charge. That's usually James or Jeff's territory. Any ideas?

 
 
  Jeff Bailey   2/11/200,  2:27:27 PM
Newmont Mining (NEM) $45.41 +2.49% ... just makes a session high.

BGO still $3.39 x $3.40

 
 
  Jeff Bailey   2/11/200,  2:24:47 PM
02:00 Internals at this Link

 
 
  Jeff Bailey   2/11/200,  2:16:53 PM
Most recent buy program alert came at 02:00 PM EST. This came when SPX 1,156.98 +0.99% lurched above its MONTHLY R1 of 1,155.98 to a session high of 1,158.89.

 
 
  Linda Piazza   2/11/200,  2:16:41 PM
The OEX looks really vulnerable to a downturn here, although the possibility remains that it could achieve that 575.50 upside target predicted by the double-bottom. Despite that vulnerability, I keep thinking about that talk this morning about the record short interest in vehicles such as the spiders and QQQ's, and wondering if more and more won't cover as the day goes on. For a long while now, I've wondered if we don't need a blow-out buying crescendo on monster volume to finally blow all the shorts out of their positions before the markets can retrace normally.

 
 
  Linda Piazza   2/11/200,  2:11:55 PM
The Wilshire 5000 exceeded the 1/26 high of 11,281.82, with the Wilshire currently at 11,288.10. MACD couldn't catch up with the rapid rise, of course, only now at the point of making a bullish cross and signaling bearish divergence. However, even the fast-moving RSI signals bearish divergence, not yet having crossed above its trendline of lower highs (unlike the Dow). This morning, I mentioned that the Wilshire 5000 looked poised to go higher but mentioned these cautionary points. They still exist, but the move higher was what came to fruition. Careful, though, the Wilshire is still within a range that might be roughly called an equal high. Those bullish the U.S. markets don't want to see a downturn now that drops below 11,000 or specifically below 10,932.72.

 
 
  Jeff Bailey   2/11/200,  2:11:52 PM
Day trade target adjustment alert ... BGO $3.40 +1.79% ... will raise intra-day target to $3.49.

 
 
  Jeff Bailey   2/11/200,  2:04:22 PM
Oh my! major indices making bold move to upside. Earlier I was thinking we might see a pullback after Greenspan testimony ended. There may have been some bears thinking the same. It isn't happening and tide of buying comes in.

 
 
  Jeff Bailey   2/11/200,  2:03:06 PM
U.S. Dollar Index (dx00y) ... intra-day chart of U.S. Dollar Index, and thoughts regarding Bema Gold (BGO) trade.

 
 
  Linda Piazza   2/11/200,  1:59:51 PM
Early this morning on CNBC Europe, a commentator spoke about how difficult it would be to get any downside going in U.S. markets, as Spiders and QQQ's and other index-related vehicles were seeing record numbers of shorts.

 
 
  Jeff Bailey   2/11/200,  1:56:49 PM
BGO $3.38 x $3.40

 
 
  Linda Piazza   2/11/200,  1:56:35 PM
The OEX has again broken through the upper Keltner channels, again showing how overbought it is on a short-term basis. As is obvious, this isn't a prediction of an immediate downturn, but the longer the OEX violates that upper channel or the greater the degree to which it does so, the more likely it is to be catapulted to the bottom of the channel. Of course, it didn't work that way earlier this week, did it, when Friday's violation and clinging to the upper channel resulted in Monday's pullback only to central Keltner support, not to the bottom of the Keltner channels.

 
 
  Jeff Bailey   2/11/200,  1:54:46 PM
BGO ..... good order flow at the $3.39 offer.

 
 
  Linda Piazza   2/11/200,  1:52:57 PM
The OEX continues to climb the 0.675% envelope on its 30-minute chart. As I mentioned earlier, hitting an upper envelope boundary shows risk switching toward those in bullish positions, but it doesn't mean that the OEX will necessarily crater immediately or even stop climbing. That's why I counseled those in bullish positions--now at risk--to follow the OEX higher with their stops in order to protect profit. This might or might not be a good place for a bearish entry, but it's certainly a place for protecting bullish gains. My research into envelopes showed that it wasn't easy to predict when the OEX might bounce back from such an envelope touch or instead might climb it, and at least one formation predicts upside to 575.50.

 
 
  Jeff Bailey   2/11/200,  1:52:53 PM
Newmont Mining (NEM) $45.22 +2.07% ... moving to afternoon highs here.

Let's see if it lifts that seller in BGO. BGO $3.38 x $3.39

 
 
  Jeff Bailey   2/11/200,  1:48:09 PM
Buy Prog. Prem. Alert SPX= 1,154, OEX = 570.83, INDU = 10,701, NDX 1,509 , QQQ = $37.50

May have been triggered as INDU moved above its WEEKLY R2 of 10,698.

 
 
  Jeff Bailey   2/11/200,  1:47:51 PM
Japan iShares (AMEX:EWJ) $9.61 +0.52% ... wanted to quickly look at this ETF to get a feel for the market's response to dollar's weakness and yen strength.

 
 
  Jonathan Levinson   2/11/200,  1:40:00 PM
In reference to AMS' question quoted in Jim's 13:30:44 post, my conclusion has been that the dollar slide has seen correlative rises in equities, treasuries and commodities valued in US Dollars. Chinese and Japanese central authorities have been devaluing their currencies to keep pace with the dollar slide and have been buying US debt with the dollar's they've been buying. An excellent study is to compare ratios on Stockcharts- here's USD Index : $Ten year note yield.

 
 
  Ray Cummins   2/11/200,  1:35:59 PM
Spread/Combos & Premium-Selling -- Market Movers: Leapfrog (NYSE:LF)

Shares of the popular (we have some in our home!) maker of children's educational toys are down over 10% today after the company said its sales growth could slow in 2004. In the third quarter, LeapFrog posted sales and earnings that were below expectations and now the company says retailers are ordering products only as needed and new orders may not materialize until the first quarter of 2004. Investors were obviously unhappy with the news but our recent straddle play in LF yielded a credit of up to $0.80 on $3.20 invested in just three days.

 
 
  Jim Brown   2/11/200,  1:30:44 PM
Hey Jim: I have been thinking and you may help but I have come to a hypothesis that the bond is not strongly tied to the equity market and in fact is more directly related to the currency market.

Bonds in all practical analysis should be falling however they stubbornly resist and stay high. Likewise conventional thinking that when equities rise bonds will fall have not been the recent norm.

Here's my hypothesis that as the US dollar falls specifically, Japan sells the Yen, buys dollars and invest them in bonds and again today the dollar falls and the bond rises.

This thought is also supported to some degree in an article in the WSJ 2/11/04 "The Hazard of Currency Reserves" Money section.

Just curious if you have the ability to plot the dollar index vs. the ten year treasury and see if it is inversely proportional over the last 6 mos. Also I would look to see if the bond and equity markets are proportional and see if one is a better guide. Thanks AMS

Not sure if this is what you are looking for but here are a couple snap shots. Jonathan would be a better authority this question.

Nine month: Link
Two year: Link

 
 
  Linda Piazza   2/11/200,  1:27:12 PM
The TRAN did move above the 38.2% retracement of its recent plunge, a level that it had been testing over the last three days. If it can maintain this level (2919.27) into the close, the next strong level of resistance should be at that 50% retracement, at about 2951.88.

 
 
  Ray Cummins   2/11/200,  1:23:18 PM
Spread/Combos & Premium-Selling -- "Early-Exit" Candidate: Cigna (NYSE:CI)

Ray: I entered the CI recommendation (Feb 50/55 Bull Put) and have seen the stock go down to current levels (around 54.50). I checked option chains and there are no 40 or 45 options. Also the maximum amount of contracts is on the Feb 55 put, so somehow I think that market makers, if wanting to inflict maximum pain, would drive [the] price to that level. What do you think? Should I trust this level or try to roll out to March with the same type of position. Thank you, JU

Hello JU, The recent activity in Cigna (since the earnings news) has certainly not been favorable and obviously, the initial exit opportunity would have been during the post-announcement sell-off or at the latest, the close of trading on Friday. Since that time, the stock has dropped another $2+ and it appears the technical indications suggest only minimal support in the current price range. As far as the area of "maximum pain," that expiration-week phenomena is something many traders consider in their position management, however most experts would suggest that you simply need to determine if the potential for a recovery of previous gains outweighs the possibility of a greater, future loss. If that is not the case, then you should consider closing the play early to prevent additional draw-downs. As you can see, it is all based on your risk/reward attitude and personal outlook for the underlying. No one can (or should) make that decision for you, because it might not be appropriate for your trading style, experience level, portfolio capital, etc. Good Luck! Ray

 
 
  Linda Piazza   2/11/200,  1:20:04 PM
The OEX came close to confirming a lower high by a move below 569.61, but the Keltner support caught it just in time, at least temporarily.

 
 
  Ray Cummins   2/11/200,  1:15:32 PM
Spread/Combos & Premium-Selling -- More E-Mail Replies: Skechers (NYSE:SKX)

Attn Combos Editor: I wanted to thank you for the great call on Skechers! I couldn't get in the synthetic play so I just bought the stock! I am up over 25% in less than a week! Keep up the good work! PW

Hello PW, Thanks for the generous comments. It isn't every day that we get in (at the right time) on a rally like that, but they are sure nice when they occur. Of course, "even a broken clock is right twice-a-day." Ray

 
 
  Jeff Bailey   2/11/200,  1:12:00 PM
BGO $3.38 x $3.39

 
 
  Jeff Bailey   2/11/200,  1:07:36 PM
01:00 Internals at this Link

 
 
  Linda Piazza   2/11/200,  1:06:08 PM
OEX Keltner support is coalescing from 569.67 to 569.90, with that support forming from several Keltner channel lines coming together on one spot. That means that the support should be firm, but that's in the context of a market that's overbought on a short-term basis. If that support should fail, then the OEX may be beginning the process that sees it eventually working its way down toward mid-channel support or possibly bottom-of-the-channel support, with those two levels at 566.86 and 563.79, respectively, but still climbing quickly. The last time the OEX broke through the upper Keltner channel boundary, however, it hovered near that boundary for an inordinately long two days, climbing along with the channels. That doesn't happen often, but it's certainly possible.

 
 
  Ray Cummins   2/11/200,  1:00:51 PM
Spread/Combos & Premium-Selling -- E-Mail Replies: Netflix (NASDAQ:NFLX)

Ray, I am in the bullish position of NFLX (Feb 65/70 Put). Do you know what is the reason for the [recent] free fall of NFLX. I don't see any company specific news. Thanks, JI

Hi JI, I looked through the news and message boards as well and could find nothing specific about NFLX to explain the drop. However, it is obvious that Blockbuster's "hefty quarterly loss" is getting lots of attention (in conjunction with the Viacom spin-off) and I suppose you could extrapolate some downside potential for similar companies in the sector. The comments I read suggested: (1) competition from discount retailers whose cut-price DVDs are enticing consumers away from renting and (2) the industry is also facing other external factors like video on demand.

In any case, NFLX is certainly due for some profit-taking (how much is the question?!?) and with the split coming, we may see the classic "post-split slump". The one bonus you have is the ability to "roll-out" far (possibly June) and low ($45?) in any future position adjustments, due to robust option premiums. (If that should fit your trading style, risk/reward outlook, etc...) I wish you much success! Ray

 
 
  Jeff Bailey   2/11/200,  12:59:52 PM
Cisco Systems (CSCO) $24.42 -1.49% ... moving to session lows here.

 
 
  James Brown   2/11/200,  12:54:04 PM
Our new call in PD has been triggered on this morning's move through the $80.51 level. The stock is soaring, up 5.09%, on very strong volume. PD has been charging higher four days in a row now on rising volume, which is exactly what the bulls want to see.

 
 
  Ray Cummins   2/11/200,  12:53:12 PM
Spread/Combos & Premium-Selling -- E-Mail Replies: American Healthways (NASDAQ:AMHC)

Ray, Would you recommend closing out the AMHC [calendar] spread for current profit, with underlying stock hitting strike price. Or hold out for pullback, or roll out to next month at higher strike? MA

Hello MA...The good news is AMHC has been a successful calendar-spread candidate in just a few weeks, so your decision is much easier than one which involves a losing play. In short, you need to determine if the potential for additional gains outweighs the possibility of a lower, future profit (or even a loss). If that is not the case, then you should consider closing the play early to lock-in the current gains (a credit of approx $0.65). I hope that helps...but remember, my comments are just one person's observations and are not, in any way, to be construed as advice or recommendations. :-)

 
 
  James Brown   2/11/200,  12:51:57 PM
IBM is still stuck in a sideways churn under the $100 level but it's trying to breakout again currently inching higher at 99.87.

 
 
  James Brown   2/11/200,  12:49:55 PM
The market rebound is also influencing shares of current OI call play DHI. The stock is bouncing from previous resistance near $29.50 and is currently trading near new highs just under 30.50.

 
 
  James Brown   2/11/200,  12:48:15 PM
A note on current call play APOL. The last three days have seen APOL struggle with resistance at $77.60 but today brings a bullish breakout over the $78 level.

 
 
  Linda Piazza   2/11/200,  12:42:53 PM
As I scan news headlines, I see that a lot more press is being given to Greenspan's reassurances than to his warnings. Headlines trumpet news about prospects being good for growth and the FOMC's belief that hiring will improve this year. None of the headlines I've found include warnings, although some news tickers mention warnings about inequitable societies. Perhaps the headlines will include some of those warnings after his comments, including those during the question-and-answer session, are analyzed, but for now those headlines are all positive.

 
 
  Jeff Bailey   2/11/200,  12:42:48 PM
U.S. Dollar Index (dx00y) 85.27 -0.66% ... session low of 85.09 came between 11:55 AM and 12:00 PM EST.

BGO session high of $3.45 came between 11:40-11:45.

NEM $45.08 +1.76% ... session high of $45.40 came between 11:40-11:45.

 
 
  Jeff Bailey   2/11/200,  12:38:30 PM
Sun Communities (SUN) $41.13 +0.07% .... not much happening, and can't say this is overly surprising. Did edge to a 52-week high of $41.20, but that's it. Low/high so far has been $40.95-$41.20.

 
 
  Jim Brown   2/11/200,  12:36:30 PM
Editors Play
Sunday I highlighted a put play on MHK after it spiked to near $80 on some earnings news. MHK has moved up slightly since then and several readers have asked for an exit point. I would not hold the puts if MHK moves up over $81.50. This would represent the start of a new leg up and a busted play. I am amazed that it is holding the current level given the news that caused the spike. Read the play description here: Link

 
 
  Jeff Bailey   2/11/200,  12:35:59 PM
BGO $3.37 x $3.38

 
 
  Jeff Bailey   2/11/200,  12:30:25 PM
Day trade long alert .... Bema Gold (BGO) $3.38 here, stop $3.32, target $3.44.

 
 
  Linda Piazza   2/11/200,  12:29:01 PM
The OEX five-minute Keltner channels have begun reining in the OEX, with the OEX now approaching 569.31 support. Eventually, though, the OEX should work its way down to mid-channel support, if not bottom channel support. That mid-channel support is now at 566.40, but is rising quickly.

 
 
  Jeff Bailey   2/11/200,  12:21:56 PM
Cancel swing trade QQQ bullish alert ... cancel current QQQ swing trade long for $37.26 entry.

 
 
  Jeff Bailey   2/11/200,  12:18:51 PM
U.S. Dollar Index (dx00y) 85.25 -0.71% ... while this quote is 30-min delayed, dollar sitting right at this week's WEEKLY S1 of 85.28.

Gold equity bulls alert here, want to see further dollar weakness.

 
 
  Jeff Bailey   2/11/200,  12:15:12 PM
12:00 Internals at this Link

Yesterday's Internals at this Link

 
 
  Linda Piazza   2/11/200,  12:04:52 PM
Those in bullish OEX plays really do need to consider following the OEX higher with stops, as the OEX grows more and more overbought on a short-term basis, and more vulnerable to the downside.

 
 
  Jeff Bailey   2/11/200,  11:58:37 AM
S&P 500 Index (SPX.X) 1,152.55 +0.51% ... closing in on 52-week high of 1,155.38.

NASDAQ-100 (NDX.X) 1,508.88 +0.57% and QQQ $37.51 +0.93% ...

 
 
  James Brown   2/11/200,  11:56:02 AM
Another example of investors' selective hearing is E W Scripps (SSP). The stock is up 2.59% to another new all-time high ($98.52) and making its third gain in a row after announcing a 10% rise in January revenues (revenues for its Scripps Network division rose 33%). However, the company lowered its Q1 earnings estimates due to lower than expected political ad spending for TV ads.

The $100 mark is normally a strong psychological level of support or in this case resistance. It's probably a good bet that SSP will run to the $100 level and then see some profit taking. Keep an eye on it for a dip. After 4 1/2 months of consolidation between 90-95 the stock might be starting another leg higher.

 
 
  Linda Piazza   2/11/200,  11:52:29 AM
At 11,238.64 as I type, the Wilshire 5000 today approaches its recent high of 11,281.82. I posted a chart this morning showing that the Wilshire 5000 has put on the most convincing show of potential upside, since it had risen above its ascending channel, declined far enough to give a convincing retest of broken resistance, and then risen again. The only potentially troublesome sign remains the series of lower highs on RSI, still opening up the possibility that the Wilshire 5000 could form an equal or lower top, or else could set up bearish divergence if it does achieve a higher high. A breakout over that 11,281.82 high should be significant, however. A rollover beneath it would be, too, but so far, that doesn't look like the highest probability result.

 
 
  Jeff Bailey   2/11/200,  11:52:15 AM
Treasuries found strong buying from 11:00 AM EST. 10-year YIELD fell from 4.12% to currently trade down 7.7 basis points at 4.025%.

This would have to be a reaction from the bond market for Fed rates to stay low.

Current YIELD on the 10-year back below its 200-day SMA.

 
 
  Jeff Bailey   2/11/200,  11:46:06 AM
Swing trade long alert ... for QQQ trade at $37.26 , stop $36.90, target $38.50.

QQQ $37.50 +0.86% ... is current trade.

 
 
  Linda Piazza   2/11/200,  11:43:26 AM
Here's what I'm noting on the OEX 30-minute chart: Link

 
 
  James Brown   2/11/200,  11:41:48 AM
Sector Winners this hour:

XAU gold & silver: +2.58%
XBD broker-dealers: +2.47%
SOX semiconductors: +1.26%
GHA hardware index: +1.25%

Sector Losers...

HMO healthcare index: -2.44%
UTY utilities index: -0.43%

 
 
  James Brown   2/11/200,  11:34:45 AM
A bullish upgrade to "over weight" for Accredo Health Inc (ACDO) from JPM is driving ACDO up 6.5% on top of yesterday's gains due to the ACDO-MHS specialty drug agreement. While this is a one-year high for ACDO the stock is quickly approaching the top of the gap from January 2003, which could prove to be tough resistance.

 
 
  Linda Piazza   2/11/200,  11:28:30 AM
Jim has mentioned some cautionary statements that might prove problematic during Greenspan's question-and-answer session. Any such statements will be coming at a time when the Keltner channels are showing the OEX severely overbought on a short-term basis. Funny how that happens sometimes, with technical vulnerability coinciding with fundamental vulnerability. Happens the other way, too. Of course, vulnerability doesn't equal definite downside. It just shows where risks lie.

 
 
  James Brown   2/11/200,  11:25:52 AM
For anyone tired of the cold (like me...it's snowing in Denver again) you might want to know about Delta's (DAL) announcement this morning. Delta is slashing prices on airfare to Hawaii from now through Feb. 20th (sounds like a good Valentines Day gift).

Prices range from $194 from LA and San Francisco to $324 from New York.

 
 
  Linda Piazza   2/11/200,  11:22:34 AM
I mentioned in my 10:21 post this morning that RSI on the Dow's daily chart had broken through its descending trendline, giving a first signal that prices were likely to break higher, too, and that's exactly what happened. Although there are problems with RSI being so fickle, it's also always the first to give such signals, sometimes leading price. It's particularly helpful to watch how RSI behaves around trendlines.

 
 
  James Brown   2/11/200,  11:20:46 AM
Shares of Office Depot Inc (ODP) are up 4% to $17.37 after reporting earnings this morning that were in-line with expectations. Actually, ODP's pro-forma numbers of 22 cents met analysts' estimates. Real earnings were closer to 15 cents a share. Revenues for the quarter were up more than 14% to $3.25 billion but under revenue estimates. So what's driving the stock price higher? ODP expects its Q1 net profit to show an 8-10% growth and guided its EPS growth for 2004 to be 15-20% higher, placing it above current analysts' estimates of $1.19 for FY04.

 
 
  Linda Piazza   2/11/200,  11:18:21 AM
The OEX has punched through the upper Keltner boundary. While this can be a valid breakout signal and while 30- and 60-minute envelopes and that double-bottom formation all suggest more upside is possible, such breaks actually signal severely overbought conditions on a short-term basis. The further the OEX punches above the Keltner channels (and I've never seen it this far above while I've been watching), the more likely it is that the eventual pullback might carry all the way to the bottom Keltner channel support, currently at 562.35. As I've warned before when Keltner channel resistance was pierced this way, this isn't a signal to sell, as the OEX can keep climbing for a while, but it's certainly a signal to start following prices up with your stops to protect gains.

 
 
  Jeff Bailey   2/11/200,  11:15:58 AM
NASDAQ-100 Index (NDX.X) 1,505 +0.45% ... upside alert I had set here per last night's Index Trader Wrap.

 
 
  Jeff Bailey   2/11/200,  11:15:02 AM
11:00 Internals at this Link

 
 
  Linda Piazza   2/11/200,  11:12:10 AM
Yesterday, I mentioned that the 30-minute and 60-minute 0.675% envelopes surrounding the 21-pma's were suggesting upside to 568-569. Today, those envelopes have turned up, suggesting upside to 569.12-569.43. The 1.35% envelopes on those same charts suggest upside to 572.82-573.07, with those envelopes turning up, too. The upside predicted by the once-again-confirmed double-bottom on the 60-minute chart is about 575.50. Not all upside targets are reached, of course, but if this one is even approached, it's suggesting a move toward those outer, 1.35% envelopes.

The problem is that if the upside move continues this quickly, the Keltner channels can't move up with the price, and we'll have a short-term overbought condition that suggests a move back to the mid-line Keltner channel or bottom Keltner channel.

 
 
  Jim Brown   2/11/200,  11:12:10 AM
Greenspan:
The imbalance in the federal budgetary situation, unless addressed soon, will pose serious longer-term fiscal difficulties. Our demographics--especially the retirement of the baby-boom generation beginning in just a few years--mean that the ratio of workers to retirees will fall substantially. Without corrective action, this development will put substantial pressure on our ability in coming years to provide even minimal government services while maintaining entitlement benefits at their current level, without debilitating increases in tax rates. The longer we wait before addressing these imbalances, the more wrenching the fiscal adjustment ultimately will be.

 
 
  James Brown   2/11/200,  11:10:24 AM
Ouch! America's Car-Mart (CRMT) is down 18.8% after announcing an earnings warning this morning. The company warned for both its Q3 and Q4. Its Q3, which ended January 31st, is now expected to produce earnings in the range of 34-37 cents, below CRMT's previous guidance at 47 cents. CRMT lowered its Q4 numbers to 54-56 cents, down from guidance of 56 cents.

Investors obviously not happy about the news and shares gapped lower and traded toward the $25.00 level, just above its 200-dma, before bouncing.

 
 
  Jane Fox   2/11/200,  11:09:55 AM
I think Greenspan needs an interpreter.

 
 
  Jim Brown   2/11/200,  11:07:55 AM
Greenspan:
The Federal Open Market Committee's current judgment is that its accommodative posture is appropriate to foster sustainable expansion of economic activity. But the evidence indicates clearly that such a policy stance will not be compatible indefinitely with price stability and sustainable growth; the real federal funds rate will eventually need to rise toward a more neutral level. However, with inflation very low and substantial slack in the economy, the Federal Reserve can be patient in removing its current policy accommodation.

 
 
  Linda Piazza   2/11/200,  11:05:42 AM
The OEX keeps getting punched down every time it jumps up to that 566.50-567 level, but I'm not sure it's through trying yet.

 
 
  Jeff Bailey   2/11/200,  11:04:38 AM
Sell Prog. Prem. Alert

 
 
  James Brown   2/11/200,  11:04:03 AM
Hmm... have you looked at a chart of Wal-Mart (WMT) today? That looks like a bad tick but the 1-minute chart shows WMT trading at $60.00 early this morning before slipping back toward the $57 level. (actually the Time and Sales shows a quick ramp up to $60 and two trades at that level before the quick drop). The 60 region has been resistance for WMT since early September.

Also in retail news Ann Taylor (ANN) was upgraded to a buy from UBS this morning and the stock is trading at a new high at $43.30 (+2.5%).

 
 
  Jeff Bailey   2/11/200,  11:03:52 AM
That buy program had NDX rising to 1,498. Now backing off at 1,495. Session low has been 1,491.21

 
 
  Jim Brown   2/11/200,  11:03:26 AM
Text of Greenspan's prepared testimony: Link

 
 
  Jeff Bailey   2/11/200,  11:00:27 AM
Buy Program Prem. Alert .... SPX = 1,144.81, OEX = 566.71, INDU = 10,625, QQQ = $37.10, NDX = 1,495

 
 
  Linda Piazza   2/11/200,  11:00:08 AM
The OEX Keltner channels are settling into an equilibrium position. Although they can hold at this position for an hour or two, such a settling-down usually precedes a breakout one direction or another. This would fit with a breakout during/after Greenspan's testimony.

 
 
  Jeff Bailey   2/11/200,  10:58:02 AM
HMO Index (HMO.X) 846.49 -2.83% Link ... leading sector loser with Health Net (HNT) $28.25 -12.9% Link pacing declines after the company reported Q4 (December) earnings of $0.76 per share (exluding $0.02 charge for items), which was in line with consensus estimates. The company said revenues rose 5% year-over-year to $2.78 billion versus the $2.82 billion consensus. Company guided Q1 for EPS between $0.51-$0.55, which was well below consensus of $0.67, and fiscal 2004 EPS of $2.92-$3.07, also below consensus of $3.09.

 
 
  James Brown   2/11/200,  10:54:53 AM
A side note for SUNW... yesterday Fitch had downgraded SUNW's debt rating to "BBB-minus", one level above junk status. Fitch said strong competition is likely to pressure the company's performance and SUNW is likely to take longer than expected to reach profitability. However, Fitch did adjust its long-term outlook from negative to stable (Reuters).

 
 
  Jeff Bailey   2/11/200,  10:50:38 AM
Priceline.com (PCLN) $25.04 +17% Link ... higher after last night's quarterly earnings. Forward guidance was for Q1 EPS to be between $0.06-$0.10, versus consensus of $0.07 per share. The company said it sees Q2 EPS of $0.22-$0.30 versus consensus of $0.25.

 
 
  James Brown   2/11/200,  10:50:12 AM
Electronic Arts (ERTS) is up 2.2% on an upgrade from Bank of America. BAC raised its rating from "neutral" to "buy" and lifted its price target to $55 on ERTS' prospects for a strong 2004. The upgrade news initially sent shares above its 50-dma but investors are selling into strength and we might see ERTS fill this morning's gap with a retest of the $45 level.

 
 
  Linda Piazza   2/11/200,  10:46:06 AM
The OEX is coiling up into a series of higher lows and lower highs on the five-minute chart. We won't know much until it breaks out of that triangle. (And maybe not even then?)

 
 
  James Brown   2/11/200,  10:45:08 AM
Motorola (MOT) is higher today (+2.5%) to $17.36 after CSFB raised its rating from "neutral" to "out perform" and lifted its price target from $16 to $20 on the belief that MOT will benefit from strong demand in the handset market.

 
 
  Jeff Bailey   2/11/200,  10:41:36 AM
Sun Microsystems (SUNW) $5.74 +3.61% ... probing 52-week high. Today, SUNW announced it had entered into a definitive agreement to acquire privately held Kealia Inc., which was founded and currently led by Andy Bechtolsheim, who was also co-founder of SUNW. Mr. Bechtolsheim will return to SUNW as senior vice president and chief architect within SUNW's volume systems products group and join SUNW's executive management group.

 
 
  Linda Piazza   2/11/200,  10:33:24 AM
Today the TRAN is testing the 38.2% retracement of the recent plunge, with that retracement at about 2919.27. This is a typical place we'd expect to see some resistance, and for three days, the TRAN has been consolidating just below this level. If the TRAN can move above this retracement level, the 50% retracement, at about 2951.88, is the next level at which we could expect resistance. Despite the 100-point bounce over the last five trading days, the TRAN's action can't be confirmed as anything more than an oversold bounce until and unless it moves above that 50% retracement level.

 
 
  Jeff Bailey   2/11/200,  10:29:31 AM
Micromuse (MUSEE) $10.07 +24.65% Link ... higher after Legg Mason gives focus to stock, which is on the firm's Select List, calling MUSEE "compelling" and raising fiscal 2004 estimates to $0.25 per share from $0.18 and fiscal 2005 EPS to $0.34 from $0.25.

Early morning trade at $10.50 triggers a spread triple-top buy signal, where current column of X now has bullish vertical count building to $17.00

 
 
  Jeff Bailey   2/11/200,  10:24:49 AM
Applied Materials (AMAT) $22.17 +0.67% Link ... Merrill Lynch made bullish comments on AMAT this morning saying it believes utilization rates, coupled with tightening supply, are increasing AMAT's visibility into customer plans and that equipment slots are being filled in manufacturing through July. Merrill saying this improves the chances for upside in next few quarters as AMAT achieves a more predictable growth plan that can be used to leverage pricing and manufacturing costs.

 
 
  Linda Piazza   2/11/200,  10:21:49 AM
I've been watching the Dow for the possibility that it could be setting up a H&S formation on its daily chart, although I view all such formations with skepticism these days, especially on a daily chart. One guide I've been watching is RSI, as it had been forming a series of lower highs. An RSI trendline break sometimes precedes a break in price. Over the last few days, the RSI was looking as if it was going to turn down along that trendline, making me wonder if that formation didn't have some validity after all. However, this morning's open turned RSI up through that trendline or at least that's the way it looks according to the way I've drawn the descending trendline. Although RSI can be notoriously fickle, and neither MACD nor stochastics has broken through similar descending trendlines, this puts Dow investors on the watch for a break higher in prices. If that happens, the H&S would be finally proven defunct, although that's going to happen anyway if prices don't soon decline to the neckline. Complicating this picture is the fact that stochastics show a hint of a possibility that they might roll down beneath their own descending trendline and RSI is hooking down again, too. We just have to wait and see what happens, but RSI has given bears a warning that prices might break higher, too, just as the potential H&S gave bulls a warning. So far, neither warning has come to fruition.

 
 
  Jeff Bailey   2/11/200,  10:18:05 AM
S&P 500 (SPX.X) 1,142.75 -0.24% ... finding morning support at its MONTHLY 38.2% retracement of 1,142.40, where near-term support zone is 1,140.99-1,142.40.

 
 
  Jeff Bailey   2/11/200,  10:14:13 AM
NASDAQ-100 (NDX.X) 1,492.09 -0.54% .... session lows here and trading DAILY S1.

 
 
  Jeff Bailey   2/11/200,  10:13:08 AM
Broker/Dealer Index (XBD.X) 711.68 +1.2% ... only sector I show up more than 1%.

Goldman Sachs (GS) $104.36 +2.13% Link higher after Smith Barney upgraded GS to "buy" from "hold" with Smith Barney raising their 2004 EPS estimates above consensus and price target to $122 from $110.

 
 
  Linda Piazza   2/11/200,  10:05:18 AM
There goes the OEX now, pulling back from that confirmation level of the 30-minute and 60-minute double-bottom formation. As I said, be careful today. The pullback is moderate now, with the OEX having overshot the closest Keltner resistance by a little. Again, as long as the OEX stays above mid-channel support, at 565.28 currently, and as long as the TRIN stays low, bulls can feel okay, but I'm afraid that we're just going to get a lot of chop today with formations setting up, confirming, and then turning around to set up something else.

 
 
  Jeff Bailey   2/11/200,  10:03:40 AM
Disney (DIS) $27.90 +15.7% Link ... released for trade.

Thus the reason for INDU intra-session rise from 10,587 to 10,620

 
 
  Linda Piazza   2/11/200,  9:59:10 AM
There's the bounce, with the OEX again moving above the confirmation level of the double-bottom seen on the 30- and 60-minute charts. Is this a fake-out, too, as yesterday's move was? The TRIN suggests it's real, but be careful today.

 
 
  Jonathan Levinson   2/11/200,  9:59:01 AM
A 5.75B overnight repo replaces the 5B expiring for a net add of 750M.

 
 
  Linda Piazza   2/11/200,  9:50:30 AM
The OEX five-minute candles are lining up along the mid-channel Keltner support. As long as they hold here and TRIN continues down, bulls can gain hope. The problem is that the actual chart formation is possibly a bearish one, a "b" distribution pattern predicting a move lower. Mixed messages here.

 
 
  Jeff Bailey   2/11/200,  9:44:33 AM
NASDAQ-100 (NDX.X) 1,499.16 -0.07% .... low/high so far 1,496.30-1,500.06

 
 
  Jim Brown   2/11/200,  9:37:37 AM
DIS earnings +0.33, estimates were +0.23

 
 
  Linda Piazza   2/11/200,  9:36:56 AM
During the first five minutes of trading, the OEX ranged from 566.58 to 565.15, with a midpoint at 565.87, and with the OEX currently that below midpoint. That H&S on the five-minute chart remains a possibility, with a neckline at about 564.50. Before the OEX hits that neckline, though, it would have to violate mid-channel Keltner support, support that is currently testing. Look for a short-term bounce soon, and watch to see how far the OEX rebounds.

 
 
  Jeff Bailey   2/11/200,  9:32:06 AM
Garmin Ltd. (GRMN) $48.00 ... downside alert

 
 
  Jeff Bailey   2/11/200,  9:29:10 AM
09:00 Update at this Link

 
 
  Linda Piazza   2/11/200,  9:08:29 AM
Here's what I'm noticing on the Wilshire 5000 daily chart: Link

 
 
  Linda Piazza   2/11/200,  8:59:41 AM
Yesterday, the OEX ended the day just shy of the confirmation level of a double-bottom on its 30- and 60-minute charts. It had moved above the 566.42 confirmation level late yesterday afternoon, but then dropped back below that level. That drop could mean nothing more than consolidation ahead of another push higher, but the brief push above the confirmation level could also have been a trap, perhaps a less likely explanation. We may have to wait to see what Greenspan has to say before we know which it was. These markets have proved themselves capable of consolidating interminably, or at least it feels that way at times, so they're certainly capable of consolidating all the way through Greenspan's testimony today and tomorrow, long enough to render useless all the chart formations we're currently seeing on intraday charts. With futures up this morning, it's possible the OEX could open above that confirmation level, although I'm never any good at predicting where the OEX will open based on S&P futures. If that did happen and then the OEX culd sustain numbers above that confirmation level through the first morning retracement, the predicted upside target would be 575.50.

Running counter to that bullish formation is a possible H&S on the five-minute chart with the OEX having just risen to right-shoulder level. If the OEX should back away from that double-bottom formation and fall below 564.50, that H&S formation might confirm with a downside target near 562. In order for that formation to have any hope of confirmation, however, prices would need to decline straight from their closing level yesterday. I usually find that formations on longer-term charts are more reliable than those on a five-minute chart, but anything is possible as we head into Greenspan's testimony.

 
 
  Jonathan Levinson   2/11/200,  8:20:06 AM
No major economic data this morning, but we can look forward to hearing Al Green's semiannual testimony to Congress.

 
 
  Linda Piazza   2/11/200,  7:12:46 AM
Good morning. The Nikkei was closed for a national holiday on Wednesday. Other Asian bourses turned in mixed performances ahead of Greenspan's testimony beginning today, with many expecting Greenspan to affirm signs of on-target growth in the U.S. One focus of news in the region was a media report that indicated that FTSE Group, a compiler of global indices, may raise Taiwan's and South Korea's markets to developed market status. The Taiwan Weighted dropped 0.52%, but South Korea's Kospi gained 1.10%. Strong showings by Samsung, Hyundai, and KT Corp in early trading helped to get the Kospi off to a good start. KT Corp is the country's largest fixed-line telecommunications operator, according to one report. By the end of the day, Hyundai was flat, however. Banks also gained in South Korea. Last year, many were hit by exposure to LG Card's troubles, with many showing the impact in this quarter's reports. They rebounded today, with some market watchers attributing the rebound to hopes for improvement in future quarters. In addition, a new finance minister was appointed to replace the current minister, resigning to run for office, and investors reacted positively to that appointment. Singapore's Straits Times declined 0.22%, but Hong Kong's Hang Seng was flat, down 0.07%. China's Shanghai Composite dropped 0.78% as investors reacted with disappointment to the Chinese government's announcement that the country logged a trade deficit last month.

Asian investors were described as cautious ahead of Greenspan's testimony, and European investors also appear to be cautious, with trading patterns mixed on the European bourses. However, trade surplus figures helped European trading, with Germany seeing a record trade surplus, achieved despite exchange rates that hurt exporters. In Germany, exports rose 1.6% and imports fell 3.9%. For all EU countries, exports rose 7.7% while imports declined 1.8%, but non-EU countries reported a different dynamic, with imports rising 11%.

In early trading, Peugeot's earnings results were credited with helping to send its stock and other carmakers higher, but I can't figure out why unless the results were expected to be far worse. The French auto manufacturer reported 2003 net income that dropped 11.4%, operating margin that dropped 24.6%, and sales that dropped 0.4%, and said that neither demand for autos nor currency issues were likely to improve in the first half of 2004. However, a Citigroup Smith Barney analyst said that the results weren't bad enough to earn the company the recent aggressive downgrades and opined that the stock price should respond positively. It was responding as he predicted earlier this morning, at least, up 5.5% at one point, and it carried some other European auto stocks higher, too. Other news centered on companies reporting today. French consumer electronics group Thomson was trading lower after the company also reported a drop in 2003 net income, operating profits, and sales, but said that Q4 sales would have risen 4.2% at constant currencies. The company missed estimates. French dairy group Danone also dropped after reporting a drop in Q4 organic sales and profits. Merrill Lynch advised clients to take profits in the company's stock.

As of this writing, the FTSE 100 was down 6.90 points or 0.16%, to 4398.00. The CAC 40 was up 10.42 points or 0.28%, to 3678.87. The DAX was up 7.87 points or 0.19%, to 4118.67.

 
 
  OI Technical Staff   2/10/200,  8:30:39 PM
The Market Monitor has been archived. You may view it and any previous days here: Link

Disclaimer: Stocks discussed in the Market Monitor are for educational purposes only and any analysis is not meant to imply a recommendation for or against that stock. The analysts in this forum as on any other website are prohibited by the SEC from giving any specific advice to ANY individual trader. All information posted is for ALL readers and is not meant to be directed to any individual. Our analysts cannot answer any email questions regarding any specific stock. Please do not ask and please do not take offense if requests are denied.

Results posted in the Market Monitor are hypothetical and OIN does not claim that any reader achieved these exact results. Due to the lag time between research, writing, posting, uploading, reading and execution there will be differences between the actual signal given and the fill achieved by the reader. Fills may be better or worse but in many cases they will be different. The writers will make every effort to give advance notice of intended signals and indicate potential price targets. Your individual results may vary depending on your activity level and aggressiveness. This forum is intended as an education service only. Trading involves risk and should not be attempted by anyone not ready to accept this risk. By acting on any signal in this forum you agree and personally accept this risk.

 
 

Market Monitor Archives