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  Jeff Bailey   3/24/200,  6:33:47 PM
Pivot Matrix for tomorrow at this Link

  Jeff Bailey   3/24/200,  6:00:31 PM
Semiconductor HOLDRs (SMH) $37.96 +1.90% .... $37.80 in after-hours. After hours low has been $37.75.

  Jeff Bailey   3/24/200,  5:55:12 PM
Overnight short alert .... QQQ $34.32 here (at bid), stop $34.41 (stop is for AFTER tomorrow's open, not overnight), target $34.08.

  Jeff Bailey   3/24/200,  5:53:48 PM
QQQ $34.42 +1.14% .... tomorrow's DAILY levels... S2 $33.73, S1 $34.08, P $34.35, R1 $34.70, $34.97.

On the Micron (MU) $15.81 -0.06% earnings, MU lower at $15.20.

  Jeff Bailey   3/24/200,  5:12:47 PM
Closing Internals at this Link

  Jim Brown   3/24/200,  5:00:05 PM
MU Earnings Loss of -.04 cents. (better than expected at -0.07) Revenue was light at $991 million compared to estimates of as much as $1.1B.

  Jeff Bailey   3/24/200,  4:42:24 PM
Excellent Topic being discussed on CNBC regarding the attempt to always be trying to explain why the market is doing what it is doing.

  Linda Piazza   3/24/200,  3:57:19 PM
The Dow will close above 10,000, the SOX will likely close above its 200-ema, so we'll have to give the bulls a shaky victory, but it's a shaky one. The BIX will likely close beneath its 100-dma and the OEX beneath the 60-minute 18-pma that's been capping its upward movements for the last two days.

  Ray Cummins   3/24/200,  3:49:11 PM
Spreads/Premium-Selling -- On the "watch" list: Beazer Homes (NYSE:BZH)

With the recent slump in Materials & Construction stocks, our bullish position (APR-95P/100P) in BZH has emerged on the list of potential "early-exit" candidates. The issue is trading near its session lows, down $0.73 at $103.46, and a test of the 50-DMA ($103.11) appears likely in the coming week. Conservative traders should watch for a close below that price and act accordingly to preserve profits or limit losses.

  Linda Piazza   3/24/200,  3:31:29 PM
The current action on the OEX 60-minute chart looks to me like a fall below what had looked to be a bull flag or perhaps bullish right triangle formation on the 60-minute chart, depending on which candle shadows you included or didn't include. If so, that would be a change from last year's action when bearish formations failed to confirm and resulted in a swing higher. This break of support hasn't yet been confirmed by a fall below this morning's low and because the OEX is still within a congestion zone, I'm still almost (not quite) as distrustful as I've been all day today of what I'm seeing. I have always thought that any rise we were seeing was more than likely some sort of distribution formation and haven't been willing to suggest any long plays, so perhaps I ought to put more faith in these minimal downside breaks. I'm glad I didn't do so this morning, however. Perhaps as Jim mentions on the Futures side, cash Dow closing below 10,000 might be the trigger for another down leg in the markets. A SOX close back below its 200-ema might be, too, but a SOX close above it (currently at 465.63) might be construed as bullish action.

  Ray Cummins   3/24/200,  3:29:58 PM
Spreads/Premium-Selling -- Market Mover: Shuffle Master (NASDAQ:SHFL)

This issue has been on our candidate "watch" list since the late February spike above $38, however we haven't been able to initiate a viable spread or premium-selling play in the wake of the strong upside activity. Last week's (Wednesday) move above $44 offered another confirmation of the bullish trend but again, there was no viable (conservative) position available with April options. Now the issue is trading at a new "all-time" high near $46 and the only reasonable premium-selling opportunity is a (short) APR-$40 put for a credit near $0.45-$0.50.

  Linda Piazza   3/24/200,  3:22:50 PM
Today's upward movements on the OEX have been capped by the 60-minute 18-pma, following it fairly closely: Link Thanks, Gumby, for teaching me to watch this average a long while ago.

  Jeff Bailey   3/24/200,  3:22:04 PM
Bearish Day trade target alert ... STM $22.51.

  Ray Cummins   3/24/200,  3:17:34 PM
Spreads/Premium-Selling -- On the "watch" list: Career Education (NASDAQ:CECO)

One of the issues making headway in the market this week, despite the bearish activity, is CECO. Currently, the stock is up $1.50 at $50.50 and the emerging (bullish) trend appears to be fairly strong from a short-term viewpoint. With that in mind, traders who participated in the recent "premium-selling" position; short APR call at $55, should monitor the stock closely for a move above the near-term resistance level at $54. Any upside activity beyond that level would be an obvious "early-exit" signal.

  Jeff Bailey   3/24/200,  3:15:36 PM
SOX.X 467.60 +2.21% ... quickly approaching DAILY R1

  Linda Piazza   3/24/200,  3:13:17 PM
Want an easy way to determine historical S/R based on recent highs and lows, without having to study the chart and draw horizontal trendlines? Just use Donchian channels. I've discussed my research into using Donchian channels in the past, but they're also a great way of looking at where resistance or support might lie because they're based on the highs and lows over a number of periods that you set yourself. For example, here's an OEX Donchian channel chart with two Donchian channels imposed. One is set at 20 periods (so 10 hours since this is a 30-minute chart) and the other at 5 periods (so 2-1/2 hours). The 20-period channel is blue and the 5-period one is red: Link When I'm using them to watch for breakouts, I offset the channels by two periods to give me a quicker breakout signal, but that's not needed if you're using them only to determine where resistance or support might lie on a historical basis, a great way to use them. It's uncanny how accurate they are. Although they're often pierced, there's seldom a 30-minute close outside one, especially the 20-period channel. As you can see from this chart, the OEX is not currently near a breakout from the 20-period channel in either direction, so is within a choppy consolidation zone right now, although it's sure getting closer to another downside breakout, isn't it? "Closer" doesn't count on Donchian channels, however, as that's often the very point where a turnaround happens.

  Jeff Bailey   3/24/200,  3:10:25 PM
Sell Prog. Prem.

  Jeff Bailey   3/24/200,  3:07:06 PM
03:00 Internals at this Link

  Ray Cummins   3/24/200,  3:06:50 PM
Spreads/Premium-Selling -- On the "watch" list: Neopharm (NASDAQ:NEOL)

Shares of the recently popular drug manufacturer are drifting lower again today as traders sell for profits after six months of gains. NEOL is currently down $1.21 at $17.91 and although it has been a great stock for bullish "premium-selling" positions (our choice is the APR-$15P), it is definitely a candidate for exit on any further downside activity.

  Linda Piazza   3/24/200,  2:57:22 PM
How is our old friend TASR doing today? It's still clinging to a steep short-term trendline that's been in place since the middle of January, temporarily violated a time or two along the way, still looking as if it might be rounding down beneath $65-66 resistance, so between a rock and a hard place as far as decision making is concerned for options traders. Oscillators give inconclusive evidence. Here's the chart with the trendlines and fitted retracement bracket that may or may not be applicable, but which so far seems to have some relevance: Link I'm not seeing anything conclusive here to point one direction or the other.

  James Brown   3/24/200,  2:57:21 PM
03:00 PM ET Sector Update

SOX semiconductors: +2.72%
GSO software index: +0.62%
GHA hardware index: +0.47%

(Biggest) Losers:
OSX oil services: -2.92%
XNG natural gas: -1.81%
XAU gold/silver: -1.64%
OIX oil index: -1.31%
XBD broker-dealer: -1.13%

  Jeff Bailey   3/24/200,  2:44:12 PM
Day trade bearish alert .... STMicro (NYSE:STM) $22.65, stop $22.72, target $22.51.

  Linda Piazza   3/24/200,  2:41:22 PM
A 50% retracement of the OEX climb from today's low to today's high occurs at about 535.10. If the current pattern on the OEX five-minute chart is a bull-flag pullback beneath next resistance, then the OEX should break to the upside before retracing much lower than that. Otherwise, what we may have may be a lower high in the making. There's really not much definitive evidence to point one way or another, as is typical of days like today and yesterday.

  Jeff Bailey   3/24/200,  2:39:57 PM
SOX.X 470.07 +2.75% .... session high has been 472.53, but edging back under the DAILY R2 of 471.40 now.

  Jeff Bailey   3/24/200,  2:36:44 PM
Day trade close out alert .... CSCO $22.72... close out here.

I looked for higher trade than session high of $22.83 based on SOX.X action, but with SOX having achieved WEEKLY Pivot intra-day basis, today's high might be in for CSCO.

  Jeff Bailey   3/24/200,  2:36:04 PM
SPX 1,094.48 +0.04% ... will note session high came at 1,098.39 and WEEKLY S1 of 1,099.67.

Broker/Dealer (XBD.X) 665.33 -0.99% and BIX.X 341.21 -0.48% offer little bullish help.

  Jeff Bailey   3/24/200,  2:25:48 PM
02:00 Internals at this Link

NASDAQ A/D back negative

  Linda Piazza   3/24/200,  2:21:33 PM
The OEX is again breaking below the ascending trendline off Monday's low. In doing so, it's also breaking to the bottom limit of the possible support of a potential bull flag on the five-minute chart. If the OEX is going to stay within that flag, it needs to move up again soon. So far, this is a lot of chop going nowhere, which is why I didn't feel comfortable recommending a long play yesterday or today, however nice it might have been to participate in the climb from today's low to today's high. Actually, that would have been quite nice, and if that bull flag breaks to the upside, even nicer.

  Jeff Bailey   3/24/200,  2:20:56 PM
Raise bullish day trade stop alert ... or CSCO to 22.61. CSCO $22.72 here

  Jeff Bailey   3/24/200,  2:12:44 PM
SOX.X 472.04 +3.18% ... sitting just at WEEKLY Pivot.

  Linda Piazza   3/24/200,  2:04:31 PM
Will bullish falling wedges work any better this year than bearish rising ones did last year? For those not familiar with these formations, wedges occur when both support and resistance lines head the same direction (both up or both down), at least according to some technicians. A rising wedge is deemed bearish with prices likely to fall through bottom support, and the opposite is true of a rising wedge. These used to be considered highly reliable formations, but last year saw bearish falling wedge after bearish falling wedge fail to produce the usual result, a quick and steep plummet after the support was breached. Anyway, here's a possible bullish falling wedge on the BIX: Link Note that these can sometimes broaden into a regular, run-of-the-mill descending regression channel. Note also that any break, if one comes, typically comes about 2/3 of the way into the wedge, and the BIX is not at that point yet, which means that even if this is a bullish formation, it could still have some distance to fall before breaking higher.

  Jeff Bailey   3/24/200,  1:57:46 PM
QQQ $34.58 +1.61% ... still some room to its DAILY R2 of $34.87.

  Jeff Bailey   3/24/200,  1:56:16 PM
SOX.X 472.09 +3.19% ... WEEKLY Pivot here.

  Jeff Bailey   3/24/200,  1:55:37 PM
SOX.X 471.50 +3.16% ... trying to make a move above DAILY R2

  Linda Piazza   3/24/200,  1:49:57 PM
On the OEX five-minute chart, the pullback since 12:30 looks as if it might be a bull-flag pullback beneath resistance. We'll soon see. Be aware that we're within that 1:35-1:55 stop-running push time of day.

  Jim Brown   3/24/200,  1:49:33 PM
AMAT just said they were extending their stock buy back program to $3 billion over the next three years.

  Linda Piazza   3/24/200,  1:44:51 PM
Unlike the SOX, the GSO or GSTI Software Index has not closed beneath its 200-ema or -sma this last week. It's pierced that average, but candle bodies have always formed above it. Daily oscillators show tentative bullish divergence, showing tentative higher lows as price was making lower lows. Something else the GSO has not yet done is rise to retest the violated regression channel that contained prices most of the last year, a channel it violated in early March. This would be an appropriate place from which to launch such a retest, but before the GSO can retest that channel support, now just under 160, it would face a host of moving averages now between 150.25 and 155.24, as well as a descending trendline off the late January high. To help measure whether any bounce might be an oversold bounce or one with legs, watch how quickly oscillators cycle up in comparison to any price move. A sideways price move while oscillators cycle up would be bearish, for example. Although software companies might be ready for a bounce, as evidenced by this chart, we can't always trust buy signals when a stock or index has been trending down, as the GSO has been since late January, so until that trend is broken to the upside by a move through these various mentioned resistance levels, I'll have to assume that the trend will continue and that any bounce might be an oversold bounce only.

  Jeff Bailey   3/24/200,  1:39:47 PM
Action hints short covering ... NASDAQ Composite (COMPX) 1,915.72 +0.73% while the NYSE Composite ($NYA.X) 6,400.54 -0.25% ....

Might be some rotation, but most likely short covering among 4-lettered stocks.

  Jeff Bailey   3/24/200,  1:11:06 PM
01:00 Internals at this Link

NASDAQ A/D now positive

  Jeff Bailey   3/24/200,  1:04:50 PM
Day trade raise bullish stop alert .... raise bullish stop to $22.50 for Cisco Systems (CSCO) $22.75 +1.74%

  James Brown   3/24/200,  1:04:29 PM
There is very little bounce in shares of Scientific Atlanta (SFA). The stock is still struggling under resistance at its simple 10-dma while trying to hold support at its 200-dma and the $30.00 level. A breakdown here could lead to a test of the $26.00 region. Currently its bearish P&F chart points to a $24 price target.

  Jeff Bailey   3/24/200,  12:53:26 PM
Sell Prog. Prem.

  Jeff Bailey   3/24/200,  12:47:57 PM
SOX.X 469.68 +2.67% ... session high so far has been 471.00.

  Linda Piazza   3/24/200,  12:36:27 PM
Here's one thing I'm watching on an OEX 60-minute chart: Link

  James Brown   3/24/200,  12:34:06 PM
Sector Update...

SOX semiconductor: +2.82%
GSO software index: +1.23%
GHA hardware index: +0.97%
BTK biotech index: +0.80%

XAU gold & silver: -1.12%
OSX oil services: -1.13%
XNG natural gas: -1.08%
XBD broker-dealer: -0.61%

  Jeff Bailey   3/24/200,  12:28:45 PM
Swing trade bearish stop alert ... IBM $92.25

  Jeff Bailey   3/24/200,  12:28:17 PM
SOX.X 469.17 +2.55% .. presses to highs of session.

  Jeff Bailey   3/24/200,  12:21:49 PM
12:00 Internals at this Link

I would have thought A/D lines would have been more near unchanged.

  Linda Piazza   3/24/200,  12:17:59 PM
Yesterday a reader wrote asking opinions about a recommendation to go long equities on a VIX close beneath 17.50. Jonathan, Mark, and I were worried about such a recommendation, with Mark expressing his opinion with some eloquence. However, I found this old chart when I was doing housekeeping duties with my workspace on Q-charts today, and noticed something interesting that perhaps related to that discussion. Is this perhaps the reason that the analyst picked out 17.50 as the make-or-break VIX number? Link

  Jeff Bailey   3/24/200,  12:13:28 PM
SOX.X 467.58 +2.21% ... session high 468.06, but still some room to DAILY R2 471.40 and WEEKLY Pivot 472.02.

  Jeff Bailey   3/24/200,  12:10:48 PM
Alexis Glick ... on CNBC mentioning selling of puts in today's trade.

Will benchmark and note the SPX April 995 puts (SXBPS) are most active at 4,173, with bid/ask $1.80/$2.30 right now. Average OHLC is $2.25. If SELLING of puts, then might look for some type of April floor, or buyers of 995 - $2.25 = 992.75 or so.

VIX.X 19.87 -3.82%

  Linda Piazza   3/24/200,  12:08:08 PM
The OEX tests mid-channel Keltner resistance at 536.57. Resistance has snaked just above this level, took, at 537.72. Above that, upper channel resistance lies at 541.45, a level I've wanted to see tested since Monday.

  Jeff Bailey   3/24/200,  12:06:31 PM
Sell Prog. Prem

  Linda Piazza   3/24/200,  12:05:57 PM
The SOX has made it back above its 200-ema, although it's only a little more than a point above that average. Still, that's a bigger move above it than yesterday's brief piercing of that average. If this can hold, that sets up the possibility that the SOX might rise again while daily oscillators cycle back up and relieve oversold pressure. I mentioned yesterday that anyone contemplating a bullish entry in a semi-related stock could consider such entries on a SOX move above the 200-sma or 200-ema (with the stock showing appropriate bullishness, too), but should keep a close watch on that MA, perhaps considering exits if that average were again violated by an account-appropriate amount.

  Jeff Bailey   3/24/200,  12:03:11 PM
Day trade long alert ... Cisco Systems (CSCO) $22.64 here, stop $22.40, target $22.98.

  Jeff Bailey   3/24/200,  11:59:44 AM
Bearish day stop alert ... SMH $37.88

Fell to $37.30 after bearish profile, then plethora of buy programs comes in. This suggests to me that there's more than some bullish nibbling taking place today.

  Jeff Bailey   3/24/200,  11:58:10 AM
Looks like Keen's thoughts in last night's future monitor playing out.

  Linda Piazza   3/24/200,  11:53:08 AM
I had already typed up the annotations on this chart when the latest five-minute spike occurred. Here's the chart: Link

  Jeff Bailey   3/24/200,  11:52:34 AM
SOX.X 464.26 +1.48% ... back to test its DAILY R1

SMH $37.73 +1.28% ...

  James Brown   3/24/200,  11:50:24 AM
Mylan Labs Inc (MYL) is up 3.44% today and bouncing from support at the $22.00 level after announcing that the FDA has given the company approval to market 100 mg. Nitrofurantoin, which is a generic version of PG's Macrobid. As the first company to file for the generic version MYL gets a 180-day period of exclusivity.

  Linda Piazza   3/24/200,  11:44:40 AM
The BIX hugs its 100-sma as I type, having pierced it earlier, but trying now to move back above it. The 100-sma is at 341.97, with the BIX at 341.28 as I type. Everything seems to be hugging some important MA or S/R level, doesn't it? It's not difficult to pick a direction when stocks or indices move away from these important levels, but it sure is when they're hugging them. One point to remember with the BIX, however, is that it broke below yesterday's low, with yesterday printing an inside-day candle and with such a break being a sell signal to those who trade inside-day formations. I mentioned yesterday that the BIX doesn't have options, but a reader mentioned that the Ishare DJ Financial Sector IYF does, but that they're thinly traded. The IYF's chart pattern looks a little different than the BIX's, too, probably reflecting a slightly different composition, with the IYF nearing possible support at the $90.00 level, a level from which it could possibly bounce up into a right shoulder of a possible H&S formation. The IYF's 100-dma lies at $89.00. One note: the IYF's head is formed of another, smaller H&S with a descending neckline, so it's possible that the IYF could break through that neckline to the downside and head down without ever forming a right shoulder for the bigger formation. A neckline break would occur at about $90.00, it appears, but then there's the possible support of the 100-dma at $89.00 to catch the IYF if it should begin to fall. It would obviously be a tough decision for anyone contemplating an entry, either bearish or bullish, especially on thinly traded options.

  James Brown   3/24/200,  11:33:35 AM
Corning (GLW) was out with some positive comments this morning. The company says they see the global LCD glass market growing 30-50% annually over the next several years with 2004 coming in at the high end of that range. GLW has already sold out of its Q1 LCD production and has essentially cornered the market on this product. Unfortunately, the news isn't helping its stock price, which remains stuck in a downtrend of lower highs while trying to hold support at its 200-dma near the $10.00 mark.

  Ray Cummins   3/24/200,  11:32:45 AM
Spreads/Combos/Straddles -- "Early-Exit" Opportunity: American International Group (NYSE:AIG)

One of our relatively new picks in the Debit Straddles section is performing well this morning. Shares of AIG have moved below a recent trading-range bottom near $70 and the increased selling pressure in early trading suggests there may be further room to the downside. The volatility-based position (MAY-75C/MAY-75P) is now comfortably profitable with a gain of up to $1.40 on $5.60 invested in two weeks. The initial target profit in the play was listed as $2.85, however conservative traders should consider today's activity as a potential "early-exit" opportunity.

  Linda Piazza   3/24/200,  11:30:58 AM
The OEX has come back up to retest the violated ascending trendline off Monday's low. The TRAN has bounced back above its 200-sma. The SOX has risen again to test its 200-sma and 200-ema. We're seeing a bounce, but with the exception of the TRAN's action, the bounce hasn't cleared important hurdles just yet. The TRIN continues its gyrations.

  Jeff Bailey   3/24/200,  11:29:19 AM
Buy Prog. Premium

  Jim Brown   3/24/200,  11:23:24 AM
The French railway bomb has been defused with no explosion.

  James Brown   3/24/200,  11:22:53 AM
Might keep an eye on Legg Mason Inc (LM) another brokerage stock. The stock looks like a bearish candidate now at $87.42 under support at $90 and its 50-dma. However, there is additional support at the $85.00 mark dating back to October-November and it is underpinned by its 100-dma. A breakdown there could lead to a test of its 200-dma near $79.

  Jeff Bailey   3/24/200,  11:22:04 AM
Buy Prog. Premium

  Jeff Bailey   3/24/200,  11:21:09 AM
Buy Prog. Premium

  James Brown   3/24/200,  11:20:42 AM
Bad news for the broker-dealers...Goldman Sachs (GS) is breaking down through combined support at its $100.00 mark and its simple 100-dma.

Meanwhile BSC, LEH, MER, MWD are all trading at new five-week lows.

  Ray Cummins   3/24/200,  11:20:15 AM
Spreads/Combos/Premium-Selling -- On the "watch" list: Genentech (NYSE:DNA)

Shares of this recently "high-flying" biotech stock have been in a slump since Monday's announcement that the drug Raptiva, co-developed with Xoma Ltd. (NASDAQ:XOMA), failed to show significant benefit in treating psoriatic arthritis in a mid-stage trial. The drug, which is already approved to treat psoriasis, did not show statistical significance in improving symptoms of arthritis by at least 20%, the main goal of the Phase II trial. Despite the news, Banc of America Securities said today that Genentech remains one of its top picks in the biotechnology sector and they have a "buy" rating on the issue with a price target of $137. While that objective seems a bit optimistic in light of the gains over the past year, the upbeat comments should help stem the downside activity in the near-term. A move below the current "trading-range top" near $97 will be our exit signal in the bullish spread position.

  Jeff Bailey   3/24/200,  11:18:42 AM
Buy Prog. Premium

  Linda Piazza   3/24/200,  11:15:59 AM
When I look at the TRAN's move below its 200-sma, the SOX's inability to rise back above its 200-sma and -ema, the high TRIN level, the OEX's dip below the ascending trendline (support for the bear flag?), and other such signs, it seems an "of course" day for a bearish play. Don't know why I'm hesitant to believe it, but I am.

  James Brown   3/24/200,  11:15:56 AM
Morgan Stanley updated their guidance for the railroad stocks. CSX Corp (CSX) is downgraded to an "under weight". Burlington Northern (BNI) is upgraded to an "out perform". Union Pacific (UNP) is downgraded to an "under weight".

The move has sent CSX to a new yearly low under support at $29.00. UNP is following suit with a drop to a new five-month low. Meanwhile the Dow Transports are down 18 points and breaking down under its simple 200-dma.

  Linda Piazza   3/24/200,  11:14:14 AM
Although it's difficult to always believe what you see on the TRAN's daily chart, since some charting systems seem to have trouble with those daily candles, the TRAN appears to be slightly below its 200-dma, with that average at 2752.47 and the TRAN at 2746.22 as I type. This is a make-or-break point for the TRAN, a likely point from which it might bounce but an ominous point from which to fail.

  Jeff Bailey   3/24/200,  11:10:48 AM
11:00 Internals at this Link

  Linda Piazza   3/24/200,  11:09:50 AM
The OEX violated that ascending trendline off Monday's low, rose to retest it, and then fell again. Closest Keltner support has lowered to 532.28, near the 530-532 range that I thought might be next support. Perhaps we should have considered the first violation of that trendline the definitive break? We'll know by the end of the day, and the TRIN now supports such an idea, but its gyrations weren't easy for me to interpret earlier in the day and neither were the OEX's actions. I'm not sure I feel totally comfortable with the idea that the downside tests of 527-530 support will come ahead of an upside test of 541.50 resistance, either. For those who don't mind being stopped out of a play or two before a directional move begins, a move below Monday's low might make a possible bearish entry. It just feels as if it might be one of those get-in-on-the-low-of-the-day bearish entries just before a turnaround that we all hate so much.

  Jim Brown   3/24/200,  11:07:01 AM
Reports of a bomb found on a French rail line.

  Jeff Bailey   3/24/200,  11:06:52 AM
Sell Prog. Prem

  Ray Cummins   3/24/200,  11:04:49 AM
Spreads/Combos/Premium-Selling -- On (and off!) the "watch" list: Symantec (NASDAQ:SYMC)

Among the issues moving higher in today's session is SYMC, up $1.40 at $43.40 on the heels of Redhat's (NASDAQ:RHAT) bullish earnings report. Jeff mentioned RHAT's affect on NOVL earlier and the quarterly announcement from the popular provider of open source software also boosted a number of other companies in the group. Red Hat said there was growth in new software subscribers, which would lead to current-quarter revenue above many analysts' estimates. Symantec investors were obviously pleased with the news, and it appears the selling pressure in the issue has ended in the near term.

  Jeff Bailey   3/24/200,  10:59:48 AM
Day trade short alert .... Semiconductor HOLDRs (SMH) $37.58 here, stop $37.88, target $37.00.

For sign of intra-day weakness, look for SOX.X to come back below its DAILY Pivot of 458.90. SOX.X trading 461.54 here.

  Jeff Bailey   3/24/200,  10:55:06 AM
Semiconductor Index (SOX.X) 462.46 +1.09% ... will note session high of 464.68 matches its DAILY R1 of 464.43.

Has me looking at a Semiconductor HOLDRs (SMH) day trade bearish/short set up.

  Linda Piazza   3/24/200,  10:44:08 AM
The SOX rises up to retest the 200-sma and -ema, currently at 463.57 and 465.58, respectively. The SOX pierced the -sma and came within a point of the -ema but then fell back. Based on this information alone, I'd interpret the daily pattern as a possible "b" distribution pattern, predicting a possible rollover beneath these 200-dma's, but the day is early yet.

  Jeff Bailey   3/24/200,  10:41:52 AM
IBM (IBM) $91.37 +0.05% ... backfilling morning gap higher here.

  Jim Brown   3/24/200,  10:39:30 AM
Jim, I keep seeing comments that since the number of layoffs and new unemployment applications seem to be decreasing each month now, that this bodes well for all the unemployed, and jobs in general.

I read it a bit differently. To me, it means that employer's have finally cut labor costs to the bone, and cannot cut further without adversly affecting the bottom line. If there is a large uptick in manufacturing and business in general, we may see some hiring, but I don't think it will be anywhere near the 300 to 350,000/month needed to start putting people back to work, and handle the new entries into the job market.

I believe that this economy has a LONG way to go before we start adding jobs at a significant rate. Just my two cents, JL

I agree, if you remember the manufacturing data from last week the new orders had fallen off the cliff and hours worked dropped substantially. The summer doldrums are ahead of us and I think we are looking a fall before any real hiring begins.

  Jeff Bailey   3/24/200,  10:38:46 AM
Broker/Dealer Index (XBD.X) 665.24 -1% ... with BIX.X 341.57 -0.41% (at WEEKLY S2 of 341.61), BKX.X 98.23 -0.34% and IUX.X 315.13 -0.43% ... will make it tough for SPX and OEX to see much of a gain with financials showing weakness.

  Jeff Bailey   3/24/200,  10:31:24 AM
Dow gainers .... HPQ $21.73 +1.63% Link , WMT $59.00 +1.35% Link , INTC $26.46 +1.10% Link , MSFT $24.40 +1.03% Link

Dow losers .... AA $33.33 -1.47% Link

Breadth positive at 16:14

  Linda Piazza   3/24/200,  10:24:49 AM
The OEX keeps violating that ascending trendline off Monday's low in a minor way. Should we have trusted that violation? Depends. If in a bearish play held over from yesterday, perhaps it's best to continue following the OEX down with stops as the violations could be signaling weakness. If considering a new bearish entry, I don't think I'd trust that violation just yet, as nearest Keltner support appears to be holding. If the OEX does hold at the now current level and climb above 536.65, it will have completed a miniature double-bottom on the five-minute chart, with an upside target about 1.2 points above the confirmation level. That would send the OEX up to test mid-channel Keltner resistance, currently at 537.34. A lot of conditions that need to be met before that test, however, and it's far from certain that it will occur this morning.

  Jeff Bailey   3/24/200,  10:23:28 AM
Gainers... Homebuilders (DJUSHB) 665.70 +1.57% and Semiconductor (SOX.X) 462.91 +1.19%

  Jeff Bailey   3/24/200,  10:21:26 AM
QQQ $34.28 +0.73% ... has not tested its WEEKLY S2 of $34.01 this morning.

Indices trying to hold some support so far.

  Jim Brown   3/24/200,  10:20:56 AM
Monthly Mass Layoffs = 941 ,(last 2,428)

  Jeff Bailey   3/24/200,  10:19:32 AM
S&P 100 Index (OEX.X) 534.93 -0.04% ... two morning lows have come right at WEEKLY S2 of 534.40. (just made a second test)

  Jane Fox   3/24/200,  10:17:03 AM
I took a fib retracement from March lows to January highs in the major markets. We are currently at the following retracements of this range:
DOW - a little past 19.1%
TRAN - 28.65% (1/2 way between 19.1% and 38.2%)
NYA - not quite to 19.1%
RUT - not quite to 19.1%
SPX - 19.1%
OEX - a little past 19.1%
COMPX - 28.65%
NDX - a little past 28.65%
SOX - 38.2%
I think this just goes to show this decline is well within normal ranges. It also shows the strength in NYA and RUT, the SPX is stronger than OEX, the COMPX is stronger than NDX and the DOW is stronger than the TRAN.

  Jeff Bailey   3/24/200,  10:12:03 AM
10:00 Internals at this Link

Yesterday's Internals at this Link

  Linda Piazza   3/24/200,  10:05:45 AM
The OEX is again back at that ascending trendline off Monday's low, testing it again this morning. First five-minute Keltner support is just below at 534.80-534.94. Let's see if it holds.

  Jeff Bailey   3/24/200,  10:05:12 AM
Sell Prog. Prem.

  Jeff Bailey   3/24/200,  10:00:35 AM
Sell Prog. Prem.

  Linda Piazza   3/24/200,  10:00:17 AM
After a minor violation of the ascending trendline off Monday's low, the OEX is back above that trendline again, climbing within the possible bear-flag formation. Mid-channel Keltner resistance has lowered to 537.32 on the five-minute chart, and upper-channel resistance has leveled off temporarily near 542, the zone at which I've thought we might find Keltner resistance corresponding with historical resistance.

  Jim Brown   3/24/200,  9:58:54 AM
Chicago Fed National Activity Index = 0.39 ,(last 0.40)
New Home Sales = 1.163 ,(est 1.084M, last 1.106M)
Monthly Mass Layoffs = 941 ,(last 2,428)

  Linda Piazza   3/24/200,  9:56:04 AM
Jane's comment on the Futures side about the Dow bullish/bearish ratio this morning prompted me to take a look at an old favorite stock of mine to trade: Dupont. Here's what I see on DD's chart: Link There's not much to trade there now, but maybe something to put on your radar screen.

  Jeff Bailey   3/24/200,  9:50:24 AM
Novell Inc. (NOVL) $10.72 +13.2% ... should have grabbed some of this in last night's after-hours trade on the RHAT numbers.

  Jeff Bailey   3/24/200,  9:45:08 AM
Sector action broadly lower, with fractional gains against fractional losses.

Leading weakness in early going is AMEX Gold Bugs ($HUI.X) 225.75 -1.77%, which is the only sector I show down more than 1%.

Homebuilders (DJUSHB) 660.96 +0.85%, Software (GSO.X) 145.58 +0.9% and Semiconductor (SOX.X) 460.58 +0.68% early gainers.

  Linda Piazza   3/24/200,  9:42:33 AM
Perhaps the announced stock buybacks by two semi-related stocks, Taiwan Semiconductor and United Microelectronics, is boosting interest in semi-related stocks this morning. The SOX again rises toward a retest of its 200-sma and 200-ema, at 463.55 and 465.54 respectively. However, the interest is tentative, if so, because the rise has been tentative, too. I'd be watching for a move over the 200-ema as a sign of strength and a fall below 450-453 as a sign of weakness in this indicator index that we often watch to gauge tech strength or weakness.

  Jeff Bailey   3/24/200,  9:41:33 AM
IBM (IBM) $91.71 +0.42% Link .... higher on Prudential commenting that current levels of trade make for an attractive bullish entry point, and that stocks decline is largely market related, not stock specific. Prudential says its checks suggest the company is on track to meet first quarter expectations.

I (Jeff Bailey) wouldn't necessarily disagree that IBM's stock has fallen based on general market movement. In fact, I'd say roughly 80% of the stocks in the market have done the same thing.

  Linda Piazza   3/24/200,  9:35:04 AM
The OEX has come down to test the ascending trendline that began forming off Monday's low. That trendline crosses at about 535.15.

  Linda Piazza   3/24/200,  9:34:17 AM
During the first five minutes of trading, the OEX spanned a narrow distance from 535.33 to 535.92.

  Jeff Bailey   3/24/200,  9:18:06 AM
09:00 Update at this Link

  Linda Piazza   3/24/200,  9:03:37 AM
The OEX closed the day yesterday just above a short-term descending trendline off the 2:05 low from Monday afternoon, but with possible bullish divergence building on the five-minute Keltner channels. That bullish divergence showed up as the OEX was repeating a test of one channel's lower boundary, with that channel having moved higher within a wider channel than on the previous test of the lower boundary. It's possible that the OEX is still priming for a climb within a possible bearish distribution formation toward resistance, perhaps in the 541.50 region or perhaps somewhat higher.

However, if that's a bearish distribution pattern, the OEX is vulnerable to a fall out of that pattern at any time and this morning's open could mark that time since futures failed to react strongly to the upside surprise in the durable goods number. Daily and other charts point to a possibility that the OEX is being drawn inexorably toward a retest of historical horizontal support, the 200-ema, and weekly mid-channel Keltner support, all in the 525-527 region, but on a Keltner chart basis, the OEX is also oversold across many time frames. Oversold or not, 30-minute oscillators show a likelihood that the OEX may turn down again, so that all these mixed-up indicators across various time frames might be pointing to another day of choppy trading, although I wouldn't think that would be true if a downside move began. I would have liked to have seen that rise into 541-542 or possibly back up to the 100-dma before suggesting any new bearish entries on rollovers, but I don't know if that's going to happen. A breakdown out of the current possible bear-flag formation and a confirming break below Monday's low would possibly signal that another leg down will send the OEX down to test 530-532 and possibly 525-527, but those considering such an entry should be prepared for a bounce at any time.

If the OEX instead continues to rise within that possible bear flag formation, I feel the same way about it that I did yesterday. I don't feel comfortable suggesting a play I consider a countertrend play now, except for the most aggressive and agile of traders, those experienced enough to make their own decisions about entries and exits. Such an entry might be a highly profitable one as the OEX grows more and more oversold on a Keltner chart basis, but since Keltners also give valid breakout signals, such a play would be vulnerable to a plummet at any time. Although I pointed out as early as last Friday that support might be offered in the 534-536 level, and so wasn't surprised to see the OEX steady and attempt a bounce from that zone, solid support isn't offered until 527-530.

  Linda Piazza   3/24/200,  8:50:56 AM
This morning saw the release of the February Durable Goods number, with that number gaining 2.5% after January's drop of 2.7%. According to one source, this number surprised to the upside, with expectations for the gain ranging from 1-1.7%. January's number was revised to that -2.7% from a previous -2.3%. Futures don't appear to have greatly benefited.

  Linda Piazza   3/24/200,  6:57:14 AM
Good morning. The Nikkei opened slightly in the green, fell toward the downside target of the intraday H&S created Monday, produced an inverse H&S and rose toward the upside target of that formation, all during the morning session. All those gyrations took place within an 80-point range either side of the flat-line level, however. After a few more touches of the flat-line level in the early afternoon, the Nikkei climbed through the last couple of hours of trading, closing up 83.90 points or 0.74%, at 11,364.99. Perhaps the early gyrations came as market participants sorted through the news that S&P had raised Japan's debt rating outlook to a stable rating from the previous negative rating, although high public debt will likely prevent a raising of the domestic currency debt rating any time soon, one S&P official noted. S&P noted that bad loans had declined and hopes for growth had increased.

In addition to that information, the Banker's Association's chairman presented an upbeat view of the sector's outlook this year and Tokyo-Mitsubishi's president affirmed that one division would meet its net income forecast for the fiscal year concluding at the end of this month. Banks gained, techs declined with semiconductors performing weakly, and autos were mixed in early trading, and that's the way the sectors closed, too. Investors appeared to be seeking domestic demand sectors, with some real estate stocks performing well.

Other Asian bourses turned in mixed performances. With Taiwan Semiconductor announcing a share buy-back plan, the stock surged and the Taiwan Weighted was one of the bourses closing with a gain, closing higher by 0.66%. South Korea's Kospi lost 0.51%, but Singapore's Straits Times gained 0.93%. Hong Kong's Hang Seng closed higher by 0.71%, but China's Shanghai Composite was flat, down 0.09%.

European bourses are mixed, too, but many have declined since their opens and now trade near or at their lows of the day just after the EU has announced sanctions against Microsoft. The EU's Monti says that Microsoft's illegal activity is ongoing. The EU fined MSFT $612 million, and demanded that it offer Windows without Media Player and share code with competitors. Until that news surfaced, specific stocks news had mostly captured attention. For the second time in a week, a European IPO was pulled, with weak market conditions being blamed both times. Morgan Stanley raised its price targets on Nokia and Ericsson, but those raised targets were below the current share prices. In early trading, German retailer Metro soared after announcing earnings that included an EBIT figure at the top end of expectations and forecasting 6% EBIT growth for 2004. Oracle competitor SAP revealed plans to acquire the shares it doesn't already own of SAP SI, an IT services subsidiary, and slipped slightly lower in early trading although one analyst labeled the plan a sound one. Poor Novartis: once considered a white knight for Aventis, a French government source reportedly labeled any bid by Novartis as a hostile bid, too, grouping it with Sanofi-Synthelabo's hostile bid. French consumer group Thomson gave an upbeat characterization of first quarter sales and the likelihood of meeting its 2004 targeted sales growth, and was rising in early trading.

As of this writing, the FTSE 100 was down 15.20 points or 0.35%, to 4303.30. The CAC 40 is down 24.99 points or 0.71%, to 3514.92. The DAX has fallen 18.79 points or 0.50%, to 3710.03.

  Jeff Bailey   3/23/200,  8:27:33 PM
Pivot Matrix for tomorrow at this Link

  OI Technical Staff   3/23/200,  8:27:25 PM
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