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  Jeff Bailey   4/1/2004,  5:31:46 PM
Closing Internals at this Link

  Jim Brown   4/1/2004,  4:13:41 PM
XMSR - saying after the close that subscriber growth is booming. They now have 1.68M subscribers.

  Ray Cummins   4/1/2004,  4:07:13 PM
Spread/Combos & Premium-Selling -- On the "watch" list: Applied Films (NASDAQ:AFCO)

Shares of AFCO, which provides thin-film deposition equipment to the flat panel display industry, ended the day $1.37 higher at $29.38, apparently in conjunction with an upgrade of Photon Dynamics by First Albany. The brokerage said PHTN was one of only a handful of companies leveraged to the growth of the Active Matrix Liquid Crystal Display (AMLCD) market and that means AFCO is poised to benefit as well. Our bearish position at $30 is intact for now but if the recent resistance level near that price is breached on a closing basis, conservative traders should consider an "early-exit" in the issue.

  Jeff Bailey   4/1/2004,  4:04:05 PM
Buy Prog. Premium

  Jeff Bailey   4/1/2004,  4:01:01 PM
QQQ $36.12 +0.72% ... if these buggers close out at $36.12 ....

  James Brown   4/1/2004,  3:56:14 PM
Bulls can keep an eye on both General Dynamics (GD) and Northrop Grumman (NOC). A trigger over the 50-dma (on either stock) might be a decent bullish entry point.

  Linda Piazza   4/1/2004,  3:54:11 PM
The OEX is sitting absolutely right on the mid-channel support on the five-minute Keltner channels, with those nested channels trying to align themselves into an equilibrium position into the close, just as it looked as if it might be doing. It's sitting right above the 120-minute 100/130-pma's, just as I thought it might do by the end of the day. Of course, we've still got nine minutes to go, and almost anything can happen. If you're in a bullish position based on a move above 553 this morning, it's probably time to exit if you haven't already done so, unless you feel like gambling overnight and perhaps spending a restless night. The OEX could gap up tomorrow morning, making you a happy person if you stayed in overnight, but it could just as easily gap down, and there's no strong evidence either direction. I've been suggesting guarding profits ever since the OEX hit its high of the day today, suggesting vulnerability to a slide down to mid-channel support.

  James Brown   4/1/2004,  3:51:41 PM
Waste Mgmt Inc (WMI) looks pretty bullish with today's breakout over resistance over $30.00 (to new 2-year highs) but shares still have old resistance dating back to 2001 at the $32.50 level.

  Linda Piazza   4/1/2004,  3:49:25 PM
New IPO SNTS is still performing well according to Jeff's 5MRT system, but it's not looking as if it's going to reach the $11.18 upside target this afternoon, with the stock currently at $10.32. That's still a hefty percentage above the $9.66 hypothetical entry level into a daytrade in this position, and I think if I were truly trading this as a daytrade, I'd be exiting fairly soon. That would have made a nice percentage profit. Too bad we're just testing out a way to observe these IPO's and maybe consider daytrading some of them one of these days, if this method works well for this purpose.

  James Brown   4/1/2004,  3:48:26 PM
Keep an eye on GCI. A move over $90.00 would be a fresh triple-top breakout on its P&F chart.

  James Brown   4/1/2004,  3:45:28 PM
For those of you who have been watching EBAY with me take note of the strong volume breakout over resistance at the $70.00 mark today!

  James Brown   4/1/2004,  3:41:56 PM
Just an observation but drug maker Wyeth (WYE) appears to have put in a significant bottom. Bulls could target a move to the resistance trendline of descending highs. Currently that would be just over the $42 level.

  Linda Piazza   4/1/2004,  3:34:11 PM
The OEX is dropping below the mid-channel Keltner support on the five-minute nested channels. It's also dropping back to the neckline level of the potential inverse H&S, but it's holding at the Keltner support line that's been catching it each time it dips below the mid-channel support. We just have to see if it holds into the close. I mentioned earlier today that there might be some effort to end the day with this chart showing the OEX in an equilibrium position, near the mid-channel support and just above the 120-minute 100/130-pma's.

  James Brown   4/1/2004,  3:30:36 PM
Keep an eye on Altria Group (MO) (a.k.a. Phillip Morris). The stock has been steadily climbing from last week's lows and is challenging resistance at $55 and its simple 50-dma.

  James Brown   4/1/2004,  3:29:26 PM
Sector update @ 3:30 PM ET

(Biggest) Winners:
IUX insurance index: +1.83%
INX Internet index: +1.94%
SOX semiconductors: +1.55%
NWX networking index: +1.15%

OSX oil services: -2.78%
OIX oil index: -1.12%
XNG natural gas: -0.64%
DJUSHB homebuilders: -0.38%

  Ray Cummins   4/1/2004,  3:23:25 PM
Spread/Combos & Premium-Selling -- Market Movers: AskJeeves.com (NASDAQ:ASKJ)

After an early consolidation, shares of the Internet search provider are bouncing back, up $1.67 at $37.40. That's a new multi-year high for the issue and the recent upside momentum shows no signs of slowing in the near-term. In addition, analysts say Internet media stocks will post improved earnings for the first-quarter of 2004. Our positions in ASKJ are comfortably profitable but the stock is somewhat overbought, so bullish traders should watch for a better entry opportunity (buy the dip?) in the coming sessions.

  Linda Piazza   4/1/2004,  3:18:24 PM
IPO SNTS is challenging $10.00 as I type, moving up to the bullish #3 on Jeff's 5MRT system. I'm not sure it's going to make it all the way up to the $11.18 upside target, however. (See my 14:36 and 12:12 posts for information about SNTS and for a chart.) Remember that I wasn't suggesting a trade in this stock, but was suggesting that some might consider testing Jeff's 5MRT as one method of watching a day-trade unfold in these IPO's.

Wow. This is really beginning to move up now, having jumped up to the bullish #4 while I was typing. Maybe it will hit that upside target after all!

  Linda Piazza   4/1/2004,  3:08:19 PM
Yesterday I mentioned that the BIX had a 350.30 upside target from the inverse H&S printed on its 60-minute chart from 3/22 to 3/29, when it was confirmed with an upside move through the neckline. It still hasn't quite met that upside target, although it thrust within a quarter point of that level earlier, reaching a high of 350.06. Since yesterday morning, it's been clinging to the bottom support of a rising regression channel, trading just below or above that rising trendline. Q-charts has graciously now allowed me to redraw and widen that regression channel, incorporating those clinging-to-the-trendline candles. That new channel shows the BIX now testing and perhaps falling below the midline support. Here's a chart that shows the inverse H&S, the new regression channel, the 60-minute 100/130-pma's and the upside target of the inverse H&S: Link Daily RSI and stochastics look bullish, but the daily chart also shows the BIX moving into a strong resistance zone that begins at the current 349.45 level. A 50% retracement of the recent plunge lies at about 351.09, so it's not until the BIX is above that level that we can safely consider its climb bullish and not a possible bear flag climbing into resistance.

  Jeff Bailey   4/1/2004,  3:07:01 PM
03:00 Internals at this Link

  Jeff Bailey   4/1/2004,  2:55:07 PM
Exxon/Mobil (XOM) $41.53 -0.14% ... just off lows of session ($41.46)

  Jeff Bailey   4/1/2004,  2:53:15 PM
June, Light Sweet Crude Oil futures (CL04M) $33.55 -4.36% ... sharply lower in last 25-minutes. Technicals testing rising 50-day SMA.

sync-Saudi adviser saying prices unreasonably high and price rise has little to do with supply/demand. Story from Reuters at this Link

  Linda Piazza   4/1/2004,  2:49:20 PM
We've got an hour and fifteen minutes until today's close, but anyone in a position, either long or short, should be considering an end-of-day strategy. Do you want to hold overnight with the jobs number to be released tomorrow morning? Estimates have been notoriously off-kilter for these numbers, so it's difficult to anticipate how the markets will be impacted tomorrow morning. Looking at the OEX five-minute nested Keltner charts, I see a possibility that there will be an attempt to move the OEX into an equilibrium position with respect to those charts, with the OEX being moved down toward central channel support, currently at 553.14 but rising. That would also position the OEX just above the 120-minute 100/130-pma's I've been watching, with those averages at 551.53 and 552.70, respectively. That would position the OEX so that it was ready to climb tomorrow if numbers are good and market reaction is, too, but would also position it within rollover range if those numbers are not good or if there's a sell-the-event reaction.

Jeff mentioned something that a commentator was saying about tomorrow's jobs numbers when it was discussed this morning. During that same segment, one commentator commented that an analyst had mentioned listening to conference calls for more than 200 companies, and that none of those companies had mentioned that they were hiring.

  Jeff Bailey   4/1/2004,  2:37:32 PM
Market Volatility Index (VIX.X) 16.84 +0.53% ... session high today was 17.25.

... Most active SPX options at this hour are...

SPX Apr. 1,050 puts (SPQPJ) 7,789 : OI=43,037

SPX June 1,130 calls (SPTFF) 5,080 : OI=442

SPX June 1,025 put (SPQRE) 4,396 : OI = 19,244

  Linda Piazza   4/1/2004,  2:36:12 PM
Here's what the SNTS IPO looks like today based on Jeff's 5MRT day-trading system: Link

  Linda Piazza   4/1/2004,  2:26:43 PM
The TRAN is moving back toward its 2915.94 high of the ay, with the TRAN at 2915.45 as I type.

  Jeff Bailey   4/1/2004,  2:25:14 PM
11:42:00 ... second link for a QQQ daily interval chart with 5-DRT should now be fixed.

  Linda Piazza   4/1/2004,  2:14:56 PM
We had a possible bull flag this morning, with the OEX retreating more than the classic 50% of the flagpole rise before breaking to the upside. That left the bullishness of the action in question. Now we're seeing a rise in another tight pattern. Is this a bear flag or a resumption of the climb? The OEX has retraced more than 50% of the drop, but OEX traders should be watching for the possibility of a lower high. Bearish traders want to see that lower high while bullish ones want to see the OEX reach a new high.

  Jeff Bailey   4/1/2004,  1:49:56 PM
Buy Program Premium

  Linda Piazza   4/1/2004,  1:31:03 PM
I've been watching the (20,2) Donchian channels on the 30-minute OEX chart, beginning to test a parabolic SAR exit after a breakout entry and compare it to the two other exit types I backtested last year. The two other types I'd backtested on an upside breakout included a close below the shorter-term (5,2) Donchian channel or a 30-minute candle that closed 2 points or more below the previous 30-minute candle's close, with a maximum 4-point loss. Both had produced some strong plays but had seen drawdowns that were too big and occurred too often. That was my reason for testing the parabolic SAR exit. Here's how one trade would have proceeded, with the exits listed in the order they would have occurred: The long entry would have been made on the close of the 11:00 candle on 3/25, at 539.78. An exit based on a close beneath the (5,2) Donchian channel would have exited the trade at the close of the 15:30 candle on 3/26, at 543.97. The gain would have been 4.19 points. The PSAR exit would have occurred at the 14:00 candle on 3/26, at 545.07. The gain would have been 5.29 points. The exit based on a 30-minute candle close two points below the previous candle's close came close to being hit at the same time as the first trade detailed, but it missed it by a penny. Unless I've just somehow missed an exit, that trade would still be active, with the OEX up 13.63 points above the entry. As you can imagine, however, that gain could be almost or totally erased while a whole series of candles moved down 1.50 points without the exit ever being triggered by a 2-point difference in closes. However, I'm finding just what I found in the backtests. This method allows for the most participation in the big movements because it doesn't stop out a play until and unless a steep reversal has begun. Here's how it looks on a chart, although the chart is difficult to decipher with both Donchian channels and PSAR lines on the same chart: Link

  James Brown   4/1/2004,  1:21:44 PM
Recently added OI put UTStarcom Inc (UTSI) shot higher this morning after Deutsche Bank upgraded the stock from "hold" to a "buy" on valuation. The stock shot towards the $30.00 mark but couldn't break it and is fading again. This may be a failed-rally at resistance sort of entry point for new put plays.

  Jeff Bailey   4/1/2004,  1:20:33 PM
Caterpillar (CAT) $79.31 +0.30% ... of its high of $80.04. What is it about $80.04? That was Tuesday's high.

  James Brown   4/1/2004,  1:19:13 PM
Shares of Lexmark (LXK), a current OI call play, are starting to look a little tired too. Today was another new 3 1/2 year but the stock is paring its gains and might be headed back toward the $90 mark.

  Jeff Bailey   4/1/2004,  1:18:52 PM
01:00 Internals at this Link

  James Brown   4/1/2004,  1:12:50 PM
I'm growing more cautious on current OI call play AVID. Today is the second failed rally at its 200-dma in the last four sessions. Odds are good we might close it tonight and look for something else to play.

  Linda Piazza   4/1/2004,  1:00:21 PM
The TRAN retests 2900, edging just below that number as I type.

  Jim Brown   4/1/2004,  12:51:20 PM
ISM Index - Here is a breakdown of all the ISM components. The only component to really explode was the prices paid but there was growth across the board in almost every area. New Orders dropped slightly. Link

  Linda Piazza   4/1/2004,  12:49:33 PM
The European indices saw a strong climb into their closes. Each of the ones we typically watch had touched or nearly touched the flat-line level after the ECB's decision was announced, but they all closed strongly. The FTSE 100 closed up 25 points or 0.57%, at 4410.70; the CAC 40 closed up 44.75 points or 1.23%, at 3669.98; and the DAX closed up 68.15 points or 1.77%, at 3924.85. What happened? The euro zone's March manufacturing sector purchasing manager's index rose a higher-than-expected 53.3, with the forecast being for a fall to 52.1. That number was released before the ECB's decision and may have been a factor in the decision to leave rates alone, some concluded. In addition, ECB's President Trichet reassured market watchers that the eurozone would see a modest recovery this year, and added that current rates help maintain price stability. The bounce in our bourses probably helped, too.

  Linda Piazza   4/1/2004,  12:46:30 PM
That last drop took the OEX closer to mid-channel Keltner support, but also dropped it just below the 50% retracement of the climb from the late-afternoon low to the high of the day today. Bulls really need it to turn around now. Mid-channel Keltner support is at 552.65, with other support just below that at 552.50.

Have you noticed what's happening with VIX today, too? It's been climbing back toward the 100-dma, currently at 17.46 and just above the current 17.17 VIX level.

  Jeff Bailey   4/1/2004,  12:43:36 PM
Dow Diamonds (DIA) 103.84 -0.07% ... just fractions red. My be impacted by today's announcement of reshuffling for Dow components.

  Jeff Bailey   4/1/2004,  12:41:54 PM
There it is... Guest on CNBC saying he thinks a strong nonfarm payroll number already baked into the cake.

  James Brown   4/1/2004,  12:41:36 PM
of course if we're eating out more we might need to upgrade our pant sizes. Guess Inc (GES) said their March sales rose 19.3% while their same store sales jumped 13.8%.

  James Brown   4/1/2004,  12:39:27 PM
Even Panera Bread (PNRA), who blamed the low-carb craze for its performance last quarter, said its same-store sales for March were up 3.8%.

  James Brown   4/1/2004,  12:38:07 PM
Here's more evidence that the economy is improving...Americans are eating out more. At least that's what we see with companies like Jack-in-the-Box announcing strong same-store sales and raising earnings guidance and P.F.Changs pre-announcing better revenues. Joining the list is Wendy's, the No 3 hamburger chain in the U.S. This morning Wendy's (WEN) reported a 9.9% jump in March same-store sales.

Outback Steakhouse (OSI) also reported better same-store sales for its steak houses (+5.3%) and its Carrabba's Italian Grill (+3.1%) and its Fleming's Prime Steakhouse (+20%).

Darden Restaurants said their Olive Garden chain's same-store sales were up 7-to-8% in March but their Red Lobster chain saw sales drop 6%.

A few days ago Yum Brands, operator of KFC, Taco Bell and others, reported strong sales numbers as well.

  Jeff Bailey   4/1/2004,  12:35:04 PM
Frixie ... Forest Labs (FRX) $72.56 +1.31% Link ... above its 21-day SMA and bulls would like to see the stock clear that rounding flat 50-day SMA above at $73.80.

Last several days, lots of broker comments, mostly positive, with great focus on their Namenda drug for Alzheimers. General comment is that MARKET missing the positive implications of this drug, not only on patient side, but fundamental implications for FRX.

A trade at $73 would get stock back on a buy signal, negate the current bearish vertical count of $65. Trade at $73 would then have preliminary bullish vertical count of $82 under construction.Link

  Jim Brown   4/1/2004,  12:33:20 PM
Text of Kohn speech on Monetary Policy and Imbalances: Link

  Jim Brown   4/1/2004,  12:32:09 PM
Kohn saying inflation saying few signs of increasing. Saying interest rates will have to be raised because they can create instability by being too low for too long. These comments are 3rd hand. I will restate when I get the real text.

  Linda Piazza   4/1/2004,  12:29:08 PM
The OEX is approaching the 50% retracement of the climb from the 15:55 low to this morning's high. If the OEX's current pullback is a bull flag, then it should break to the upside before retracing more than that amount, with that level at 553.35, with the OEX looking as if it's trying to make that move now.

  Jeff Bailey   4/1/2004,  12:28:48 PM
Buy Program. Premium

  James Brown   4/1/2004,  12:28:04 PM
An upgrade to "buy" from Legg Mason has sent shares of InterActiveCorp (IACI) to a 3.6% gain. The stock has been in rally mode the last several days and looks short-term overbought with its bounce from $27.50 but today's move is a major breakout above the descending trendline. Chart: Link

  Jeff Bailey   4/1/2004,  12:26:19 PM
QQQ $35.97 +0.36% ... has been slowly trending into WEEKLY R1 since session high of $36.25.

SOX.X 493.87 +1.38% pulls into its WEEKLY R1 here.

  Jeff Bailey   4/1/2004,  12:23:01 PM
Jack In The Box (JBX) $27.87 +11.61% Link

May have some shorts caught in this one. Certainly looked like the "break away," then "running," and final "exhaustion gap" at the $25 level.

Pnf chart had stock meeting its bullish vertical count of $25 too.

  Jeff Bailey   4/1/2004,  12:18:20 PM
Cost-U-Less (CULS) $6.24 +16.20% Link ... a chart that looks like somebody started to load the boat a couple of weeks ago, and may be rounding out today.

  Linda Piazza   4/1/2004,  12:17:26 PM
OEX mid-channel Keltner support is now at 552.58 with lower channel support currently at 549.43. This is not the kind of action that those in bullish trades want to see, with the OEX moving back into the regression channel that it had moved above, but it's still above the 552.50-553 historical support and still above the central Keltner channel support. Be careful.

  Jeff Bailey   4/1/2004,  12:16:20 PM
CAM Commerce Solutions (CADA) $14.35 +24.35% Link ... that's got some volume. Need to check the bullish vertical count.

  Jeff Bailey   4/1/2004,  12:13:39 PM
Parmion Corp. (PHRM) $25.08 +11.26% Link .... bullish looking chart from consolidation, but lacks the volume I like to see.

  Linda Piazza   4/1/2004,  12:12:02 PM
I've been watching some of this week's IPO's, using Jeff's 5MRT system to see if that would be a good tool to use for trading IPO's. Yesterday saw the release of CUTR, a manufacturer of aesthetic laser products for cosmetic treatments, but that never moved out of the neutral zone by Jeff's system. MCHX, a marketing service that provides help for companies that sell their products on the Internet, was released yesterday and triggered a buy signal on a move to the bullish #2. It did move slightly above the bullish #3, but then fell back. While it never hit a stop, and end-of-day exit would have seen a small loss. It wouldn't have been much of a loss, however. SNTS, a specialty pharmaceutical company, was due to be released yesterday, I thought, but didn't come out until today according to my charts, with the first five-minute range being from $8.72 to $9.19. That puts the bullish #2 at about 9.52, and the stock is currently turning down from just below that level, trading at $9.40 as I type. The jury is still out, since these are only three cases, but so far, these IPO's have refused to obey the rules and trade fair on their release dates. Perhaps this system isn't the best to use to trade IPO's, as much as we would like it to be. Rather, perhaps it's just not a good idea to trade them, although I can sure remember some of the fun of trading them in the heydays of the mo-mo times.

  Jeff Bailey   4/1/2004,  12:10:20 PM
Mamma.com (MAMA) $15.76 +15.2% Link ... made a new 52-weeker today.

simply exploded from that tight little pennant.

  Jeff Bailey   4/1/2004,  12:04:59 PM
QQQ ... here's the WEEKLY interval chart of the 5-DRT. Link

If the QQQ can get a FRIDAY close above $36.22, then I've got to think there's still upside potential back to $38.00. All year I've been "hoping," but not counting on a decline back to $30.50, when bullish % below 30%, then "give'm heck" from the bullish side to $45.

  Linda Piazza   4/1/2004,  11:53:21 AM
The OEX is beginning to fall back inside the ascending regression channel that it popped above this morning. The move back into that channel is minimal as yet, but five-minute oscillators show that the OEX could still fall further during the five-minute down phase. Keltner support is getting tugged lower with the dip in prices, and remains just below the current OEX price. Bullish players want to see this turn around soon, although bullish accumulation patterns such as bull flags sometimes do retrace about 50% of the climb that preceded their formation, with that level being near 553.30-553.40 on the OEX. As I've been warning all morning, be sure to protect any bullish profits as the OEX looked overbought on a five-minute chart basis and any further rise will soon hit nearby resistance.

  James Brown   4/1/2004,  11:52:18 AM
One of the most heavily shorted stocks gave bears another scare this morning when Netflix (NFLX) announced that it ended the first quarter with 1.9 million subscribers. This was up from 1.487 million in the fourth quarter and up from 1.05 million a year ago. NFLX has short interest close to 80% of its float and shares gapped higher to $36.10 this morning before fading. The stock is not cheap with a P/E of 387 but it has been a favorite of the momentum crowd.

  Jeff Bailey   4/1/2004,  11:42:00 AM
Is anyone still following the "5-DRT?" .... which a trader asked about in the January 18, 2004 Ask the Analyst column. Link

Here's the QQQ chart, but on a daily interval to show some greater detail. Link

On a weekly interval bar chart, it would show the QQQ piercing that $34.44 level, but not closing below it on an end of week trade.

  Jeff Bailey   4/1/2004,  11:35:25 AM
QQQ $36.10 +0.72% ... session high has been $36.25.

  Jeff Bailey   4/1/2004,  11:34:19 AM
Dow Industrials (INDU) 10,396.74 +0.38% Link ... eases back from session high of 10,419.04, where WEEKLY R2 of 10,428.37 is just above.

Some overhead supply at 10,450.

  Linda Piazza   4/1/2004,  11:33:31 AM
In addition to testing Keltner support, the OEX has drifted back down to test the top of the ascending regression channel that had been containing its prices since midday on Tuesday. So far, it's finding that former resistance to be support, but the support is tentative so far. Bullish traders don't want to see the OEX fall back inside that channel.

  Linda Piazza   4/1/2004,  11:29:28 AM
The DOW is back below 10,400, trying to rise back above that level again. Keep a watch.

  Ray Cummins   4/1/2004,  11:27:52 AM
Spread/Combos & Premium-Selling -- Market Movers: Marvell Electronics (NASDAQ:MRVL)

Today's move could be described as a "marvell-ous" performance as the stock is up $1.42 at $46.38, well within striking distance of the 52-week high. There is no news to explain the activity, however Marvell's Board of Directors has approved a 2-for-1 split of its common stock, to be effected pursuant to the issuance of additional shares. The stock split is subject to shareholder approval at the 2004 annual meeting, tentatively scheduled for late May 2004. If approved, the split is expected to occur within 30 days of the meeting. That's great news for investors and our readers as well because MRVL was a recent pick for a bullish spread position. Traders who favor the upside potential in the issue might consider a MAY-$37/$40P "bull-put" spread for a credit near $0.30.

  Linda Piazza   4/1/2004,  11:23:22 AM
The OEX five-minute chart shows that the current pullback could be taking the form of a bull flag or possibly even a bullish falling wedge shape. It's a tight pattern, suggesting that it will possibly break to the upside before retracing a full 50% of the flagpole climb that preceded its formation, but that's not a given, of course. Keltner support lines have fanned out a bit, not looking as strong as they did a bit earlier, but it's at one support level now, near 555, and has another now at 554.65. If the OEX is remaining as strong as it appears, that second level should hold without the OEX overshooting it very far. Sooner or later the OEX will need to retreat to mid-channel support, currently at 552.23 but rising fast, or lower channel support, currently at 549 and rising fast, but bullish traders don't want that retreat to happen today.

  Linda Piazza   4/1/2004,  11:16:12 AM
Others have mentioned the TRAN today, moving above 2900 for the first time since early March. However, the TRAN is also challenging an ascending trendline that began forming off the 2/04 low, with the TRAN having broken through that supporting trendline on March 9. This is the first test of that trendline since it failed as support, so it's unclear as yet whether it will serve as resistance. On Monday, the TRAN broke through another trendline, this one a descending trendline that had been holding since 2/12, so it's already shown strength on that basis. The TRAN currently has a P&F downside objective of 2400, but it didn't fulfill its last bullish objective, so possibly we can't count on it fulfilling this bearish one, either. At least that P&F objective warns us of the possibility that the TRAN has more downside to go.

  Ray Cummins   4/1/2004,  11:15:23 AM
Spread/Combos & Premium-Selling -- Market Movers: Bed, Bath & Beyond (NASDAQ:BBBY)

The phrase "post-earnings sell-off" is appropriate here as shares of the domestics merchandise and home furnishings retailer slumped this morning despite the company's announcement of a 37% rise in quarterly earnings. The numbers topped consensus expectations but investors apparently wanted more as the stock is currently down $1.17 at $40.73. Fortunately, that's the right direction for traders in our bearish credit spread and with any luck, the issue will remain below the sold (call) strike at $42.50 for the next two weeks.

  Jim Brown   4/1/2004,  11:11:04 AM
FR Board: Speech by Governor Bernanke
Financial education and Jump$tart survey Link

  Jeff Bailey   4/1/2004,  11:09:59 AM
11:00 Internals at this Link

  Linda Piazza   4/1/2004,  11:08:06 AM
James is mentioning the gains made in many retailers. Retailers have generally been doing better across the globe lately, with many of the articles I read early in the morning while preparing the overseas reports mentioning domestic companies such as retailers doing better. According to some of those reports, Japan's retailers have been perking up a bit lately on hopes that that consumer spending would pick up, too, but also because investors have been turning from exporters to domestic issues as the yen rises against the dollar. Today's tankan survey did show some hoped-for increases in consumer spending, with non-manufacturing firms showing the first positive result in 7 years, I believe.

  Ray Cummins   4/1/2004,  11:05:23 AM
Spread/Combos & Premium-Selling -- Market Movers: Millicom International Cellular (NASDAQ:MICC)

Shares of the global provider of cellular services, primarily in emerging markets, are soaring higher today. MICC is up $2.45 at $24.45 and there is little news, outside of its listing on Stockholmsborsen, to explain the upside activity. Our new position (listed yesterday) at $17.50 was not available due to the "gap-up" at the open, however bullish traders might consider a (short) $20P in May for a credit near $0.50.

  Linda Piazza   4/1/2004,  11:03:01 AM
Where did I get that 557.50 number that I've suggested as possible next strong resistance for the OEX? That's the bottom of the consolidation zone from late January to early February. However, the 555.75 level was also resistance, marking an early support level from December. This nearby resistance cautions bullish traders to keep raising their stops, protecting profits.

  James Brown   4/1/2004,  11:02:31 AM
The Dress Barn (DBRN) is up 5.9% to $18.58, a new all-time high, after reporting this morning that March sales rose 15% and same-store sales jumped 9%.

  Jeff Bailey   4/1/2004,  11:01:29 AM
Dow Transports (TRAN) 2,912.07 +0.57% ... back above their trending lower 50-day SMA (2,904) for first time since falling below (2,976) on January 28.

  James Brown   4/1/2004,  10:59:03 AM
Jack In The Box (JBX) is up more than 10% to $27.57 after pre-announcing stronger earnings for the March quarter. Earnings are now expected in the 42-to-44 cent range, significantly better than previous guidance at 28 cents.

  James Brown   4/1/2004,  10:55:28 AM
J.P.Morgan is turning bullish on some of the transport stocks. The broker upgraded both Heartland Express (HTLD) and C.H.Robinson (CHRW) to "over weight". HTLD is up 3.64% to $23.62 but it was unable to breakout over its simple 200-dma at $24.25 this morning. CHRW is up 3.18% and near all-time highs.

  Jeff Bailey   4/1/2004,  10:51:23 AM
QQQ $36.22 +1.09% ... DAILY R2 here.

  Linda Piazza   4/1/2004,  10:51:02 AM
That's probably the explanation, Keene. (See Keene's 10:46 post.) It just seems irresponsible. Apparently this broker did know about some of the events that might impact rates, since she mentioned that we'd know more on Friday, and perhaps know a little more today. I took that as meaning it was likely she was watching economic releases.

And Jonathan, I agree with your assessment of the problems needed to lower those rates. I'd like to add in concerns about the problems experienced by our senior citizens trying to live on their savings, with one mid-70's senior telling me that she was getting something like 1% on her investments now and trying desperately to keep from digging in to her capital.

  James Brown   4/1/2004,  10:50:17 AM
...hmmm... the Stock Traders Almanac says that the first trading day in April has been an up day for the Dow Industrials 9 out of the last 12 years.

  Jonathan Levinson   4/1/2004,  10:48:17 AM
Agreed, Keene. I think many brokers are expecting lower rates because they need lower rates to keep business moving.

  Jonathan Levinson   4/1/2004,  10:47:26 AM
Linda, I'm thinking that it will take a disaster to get rates back into the cellar- such as a bad jobs report or a geopolitical event. The PPI data and the obvious, factual inflation it attempts to deny, should result in a selloff in bonds and a hiking of long rates, regardless of what the fed wants. The Bank of Japan getting back with the interventionist program would also lower rates.

  Linda Piazza   4/1/2004,  10:46:39 AM
The OEX has hit a high of 555.60, breaking out above the five-minute Keltner channels, so issuing a breakout signal on that basis. As always, I advise anyone in a long play under such conditions to begin following the OEX higher with their stops. Such breakouts can be valid signals, but they also strongly signal that the OEX is overbought on a short-term basis. It's time for a pullback. If the OEX is strong, it will find support near 554.49 or 553.99 on any such pullback, as those are closest Keltner support levels.

  Keene Little   4/1/2004,  10:46:33 AM
Linda, I think it has to do with pie-in-the-sky thinking by so many people now. The stock market will continue to rise forever, interest rates will continue to drop, real estate prices will continue to rise, etc. etc. Pollyannish if you ask me.

  Linda Piazza   4/1/2004,  10:42:48 AM
Look at the TNX, climbing above the resistance Jonathan warned us to watch in one of his Futures articles. One of my daughters is buying a new home. Her mortgage broker told her not to lock in rates a week or two ago, even though it was free for her to do so, because it looked as if rates were going to go down more. By this week, when my daughter talked to me about it, her projected house note had already gone up $200/month. I urged her to lock in rates, as the TNX was up against resistance. I told her that there were so many global economic developments this week that it was impossible to be sure whether the TNX would break out above resistance or turn down from it unless one had a special connection with OPEC, the Bank of Japan and/or the ECB, along with our government entities releasing economic figures this week. However, chart characteristics sure looked as if it was going to head higher. I'm not as experienced at watching the TNX as some others or in figuring in the various impacts of OPEC's decision and these other events, but my impression was confirmed by Jonathan's comments in one of his Futures Wrap articles. Fortunately, they locked in the rates. I don't know why the broker was so certain that they would head down again, because nothing on the TNX's chart looked that way to me.

  James Brown   4/1/2004,  10:39:09 AM
I know Jim already mentioned the Dow reshuffling but look at these differences in market cap.

AT&T (T) = 15.3 Billion market cap
Intl Paper (IP) = 20.2 Billion market cap
Eastman Kodak (EK) = 7.13 Billion market cap
American Intl Group (AIG) = 191.4 Billion market cap
Pfizer Inc (PFE) = 272 Billion market cap
Verizon (VZ) = 103.6 Billion market cap

  James Brown   4/1/2004,  10:31:51 AM
Sector update @ 10:30 AM ET

(Biggest) Winners:
IUX insurance index: +1.92%
NWX networking index: +1.94%
SOX semiconductors: +2.00%
INX internet index: +1.79%
GSO software index: +1.43%
DRG drug index: +1.27%
CYC cyclical index: +1.28%

OSX oil services: -0.88%
RLX retail index: -0.51%

  Jeff Bailey   4/1/2004,  10:30:44 AM
Bearish swing trade stop alert .... QQQ $36.10.

  Linda Piazza   4/1/2004,  10:30:27 AM
The OEX has hit top Keltner resistance on the five-minute chart, with that resistance at 554.99. It's pausing here, but hasn't really pulled back. The depth of any pullback will tell us whether the OEX has a chance of testing that next 557.50 resistance or even moving up to 561.50-563 resistance. Be careful, though, as the global markets have needed to digest a lot of information over the last 24 hours, and there's still important information to come tomorrow. If I were in a bullish position based on a breakout above 553, I'd sure be moving my stop up, perhaps to breakeven or perhaps to the next support level below that breakeven point.

  Jeff Bailey   4/1/2004,  10:28:26 AM
QQQ $36.04 +0.55% .... just made a new session high of $36.08.

Veeeery close to my QQQ swing trade bearish stop of $36.10.

  Linda Piazza   4/1/2004,  10:24:03 AM
Reader Question: I have a prob w/ my charts right now. what was yesterdays W5000 high and low?

Response: You're not the only person experiencing problems with your charts. If I'm to believe my charting service, the low yesterday for the Wilshire 5000 was 10983.94 and the high was an astounding 16683.18. Obviously, the Wilshire's chart suffers from the same sort of bad tick that the OEX and some others do. Either that, or somebody got a terrible fill on some index buys yesterday! Switching to intraday charts, I see that the high yesterday for the Wilshire 5000 was 11078.78, but due to the problems with my own charting service, I can't be sure that's accurate.

  Jeff Bailey   4/1/2004,  10:23:19 AM
60-minute interval reverse head/shoulder patterns I see in IBM and INTC.

  Jeff Bailey   4/1/2004,  10:21:31 AM
Semiconductor Index (SOX.X) 495.58 +1.73% ... trades above WEEKLY R1 (493.50) for first time this week.

This does not bode well for my QQQ swing trade bearish at this point.

  Jeff Bailey   4/1/2004,  10:17:07 AM
QQQ $36.07 +0.61% .... and session high.

  Linda Piazza   4/1/2004,  10:16:27 AM
The OEX is at the very top of the ascending regression channel on the five-minute chart that's been guiding prices since about midday on Tuesday. It's time for it to turn back, if it's going to do so, although it's not impossible that it will climb the underside of the resistance line without either breaking through or falling toward bottom support again. Unless the OEX retreats back below 552.50-552.60 on any such retreat, then we have to think it decided to forego forming that right shoulder and is just moving up toward next resistance. That puts 557.50 and then 561.50-563 as the next levels to watch for firm resistance. Note: As I typed, the OEX began to climb out of that ascending regression channel.

  Linda Piazza   4/1/2004,  10:06:06 AM
The Wilshire 5000 is testing yesterday's high, currently slightly above that level.

  Jim Brown   4/1/2004,  10:00:13 AM
ISM Index = 62.5 , (est 60.5, last 61.4)
Construction Spending = -0.1% , (est -0.1%, last -0.3%)

  Jonathan Levinson   4/1/2004,  10:00:01 AM
We have a net 2.25B drain with 2.75B in overnight repos against 5B in expiring 6 day repos.

  Linda Piazza   4/1/2004,  9:57:15 AM
As we await the 10:00 numbers, the OEX is positioned at the 120-minute 130-pma, ready to break through or roll over, depending on the numbers. Remember that the first reaction is not always the final reaction. Be careful.

  Linda Piazza   4/1/2004,  9:54:34 AM
Remember that huge H&S formation on the SPX that was much debated in early 2003? When I switched to my laptop to utilize the 4.5 version of Q-charts, I found this old chart (ignore the bad tick from yesterday): Link

  Linda Piazza   4/1/2004,  9:49:09 AM
For those who are watching the OEX on Q-charts, the 4.5 version shows the daily charts (although it also includes the bad tick) while the 5.0 version is not giving much historical data, distorting the information. When I upload a new version onto my desktop, I keep the old version on my laptop for just such reasons.

  Jeff Bailey   4/1/2004,  9:48:49 AM
Out for 30-minute .... I have to step away or 30-minutes, will be back.

  Jeff Bailey   4/1/2004,  9:44:30 AM
IBM $92.25 +0.46% ... shorter-term traders might look to play this one from the long side with the "inside day" technique.

  Jeff Bailey   4/1/2004,  9:43:33 AM
Precious Metals Bullish % .... yesterday's trade now has Dorsey/Wright and Associates' Precious Metals Bullish % (BPREC) reversing back up to "bull confirmed" status at 64%.

  Jeff Bailey   4/1/2004,  9:39:12 AM
QQQ $35.86 +0.03% .... h/l has been $35.91-$35.78. Opening 5-minute bar l/h was 35.78-35.90 (for 5-MRT).

  Linda Piazza   4/1/2004,  9:35:55 AM
During the first five minutes of trading, the OEX spanned a range from 551.12 to 553.12. That range spanned a great part of the distance between bottom support and top resistance in the ascending regression channel on the five-minute chart, linked to my 9:20 post. Upper resistance is just under 554, with upper Keltner resistance on the five-minute chart at 554.33.

  Jeff Bailey   4/1/2004,  9:35:43 AM
Qualcomm (QCOM) $65.80 -0.73% Link .... bullish traders/investors might look to take some profits as stock is nearing its bullish vertical count of $67. QCOM traded a 52-week high yesterday of $66.97, which is pretty close to $67.

See Linda's 09:26:11

  Linda Piazza   4/1/2004,  9:30:39 AM
As we move toward our opening, European stocks bounce off the lows hit right after the ECB decision, but none among the FTSE 100, the CAC 40, or the DAX have yet moved back anywhere near their highs of the day.

  Jeff Bailey   4/1/2004,  9:30:37 AM
Yesterday a trader wanted to see the June Gold futures on a PnF chart. I had put this one together, then didn't post it when the late afternoon volatility took place. Link

I had hand charted yesterday's New York spot gold trade on it.

  Jane Fox   4/1/2004,  9:27:12 AM
Dow Jones and Co. the publisher of The Wall Street Journal is considering launching a monthly price-per-ton index for benchmark hot-rolled and cold-rolled steel products sold in the U.S. in coming weeks.

The London Metal Exchange and New York Mercantile Exchange are also considering starting a futures market in steel. The Multi Commodity Exchange in India launched trading in steel futures earlier this month, making it the only one of 45 futures exchanges around the world that trade futures on steel.

  Linda Piazza   4/1/2004,  9:26:11 AM
Those of you who like to trade QCOM should note that the Bank of America has cut the stock to a neutral rating. I don't frequently watch QCOM and so am not knowledgeable about its chart characteristics, but I know many of our readers do watch it, and so mention this information.

  Linda Piazza   4/1/2004,  9:20:36 AM
There's nothing like a little 665-point bad tick on the OEX to mess up the daily charts. Fortunately, I've posted my little theoretical inverse H&S scenario for the OEX often enough since last Friday morning that we've probably all got it memorized by now. Here's how it looked Friday morning with the possible trajectory I mapped out, with the original annotations: Link Here's how it looked near yesterday's close: Link That chart shows the OEX following that scenario perfectly since Friday morning when I first drew out a possible trajectory for the OEX, but today may be a make-or-break day for that scenario. Fortunately, because of the way that bad tick has impacted charts, I've also retained my comments from yesterday morning, noting anticipated support and resistance levels if the OEX should push above that neckline or roll down below it. Here are yesterday morning's comments: Such a push [above the neckline level near 553] might send the OEX up to test the 557.58 level, the 61.8% retracement of the most recent fall [on the daily chart]; the 561.50-563 level that is next historical resistance above that; or the 569 level that marks the current location of the former supporting trendline depicted on that first chart with this post. A rollover near 553 might suggest a push down toward 541-542, with 532-534 being a next downside target if that level should fail.

The OEX ended the day yesterday at the bottom of this ascending regression channel on the five-minute chart: Link Obviously, then, a drop is going to break through the bottom of this channel, but note that the OEX has had some minor penetrations of the downside support on this channel and then has moved up again, so don't commit too much to a bearish thesis until and unless that channel is violated decisively. Such a move will also break through mid-channel Keltner support on the five-minute chart, suggesting a possible fall down toward the bottom support. However, all day yesterday, the OEX kept violating that mid-channel support only to find support from another channel line with that channel line currently at 550.51. Futures just aren't giving us many clues about what might happen and we might see some volatility ahead of the 10:00 numbers, but so far, the inverse H&S is still a possibility as is a decisive breakout. Let's see what happens.

  Jim Brown   4/1/2004,  9:16:54 AM
Dow Jones reshuffling the Dow on April 8th

Leaving the Dow = T, EK, IP

Coming in = AIG, PFE, VZ

  Jeff Bailey   4/1/2004,  9:11:46 AM
09:00 Update at this Link

  Jonathan Levinson   4/1/2004,  9:10:24 AM

  Jonathan Levinson   4/1/2004,  8:35:41 AM
The finished goods producer price index rose a tame 0.1 percent in February after soaring 0.6 percent in January. Excluding food and energy prices, the core PPI also rose 0.1 percent in February after rising 0.3 percent in January.

  Jonathan Levinson   4/1/2004,  8:35:06 AM
Initial claims for benefits in the week ending March 27 fell 3,000 to 342,000 from a revised 345,000

  Jonathan Levinson   4/1/2004,  8:33:15 AM

  Jonathan Levinson   4/1/2004,  8:31:32 AM


  Jonathan Levinson   4/1/2004,  8:09:15 AM
Grot's latest is at this Link . We await the 8:30 release of initial claims, est. 340K, February's PPI, est. .4% and core PPI, est. .1%. At 10AM, we get February construction spending, est. unchanged, and ISM, est. 59.5.

  Linda Piazza   4/1/2004,  7:59:44 AM
The ECB leaves rates unchanged. European bourses continue their declines from early morning highs, with the FTSE 100 now up only 4 points or 0.09%, at 4389.70; the CAC 40 now up only 5.35 points or 0.15%, at 3630.58; and the DAX up 10.09 points or 0.26%, at 3866.79.

  Linda Piazza   4/1/2004,  6:39:34 AM
Good morning. The Bank of Japan's March tankan survey rose to a much higher-than-expected 12 from December's revised-down 7, beating the median forecasts of 10. The number for large non-manufacturers rose to 5 from the previous zero. December's downward revisions reflected a number of changes in the way the number was calculated, but any number over zero means that optimists outnumbered pessimists. With 2500 new companies added, the survey included 10,562 companies and was taken from February 23 to March 31. Economists and companies credited rising consumer spending with keeping the export-led recovery going, with this quarter's number reportedly being the highest since 1997. This quarter also reportedly marked the first time that service companies showed optimism in the last seven years.

The Nikkei opened in the green, but perhaps a sell-the-number mood ensued because the index soon dipped into negative territory with exporters heading down in early trading. Oscillating around the flat-line level throughout the rest of the day, the Nikkei closed down 31.97 points or 0.27%, at 11,683.42. Many exporters closed lower. Among those exporters, auto stocks and many computer-related issues dropped. Toyota was one of the declining auto stocks, dropping 3.6% despite speculation that its earning report in May will show it to be the first Japanese company to post an annual group net profit that numbers more than 1 trillion yen. Among computer-related issues, Advantest was one company that bucked the sector's performance, with the stock gaining 1.5%. Many banking issues and retailers headed higher in earliest trading, with the banking and insurance sectors credited in one report with preventing the Nikkei from seeing stronger losses by the end of the day.

Tech issues suffered on many other Asian bourses, too, although most other Asian bourses closed higher. The Taiwan Weighted was flat, gaining only 0.02%, but South Korea's Kospi gained 0.26%. Singapore's Straits Times climbed 0.63%. Hong Kong's Hang Seng was one of the few other Asian bourses showing a decline, but it was minimal at 0.04%. China's Shanghai Composite gained 0.95%.

Most European bourses gain in early trading, although one CNBC commentator questions why that would be happening after yesterday's U.S. economic numbers. Headlines credit cyclicals with leading the FTSE higher, while optimism over the ECB's soon-to-be-released rate decision may be helping to drive the CAC 40 and DAX higher. In addition, Ericsson's raising of expectations for the first quarter's gross margin sent that stock up more than 8% in early trading, perhaps also adding to the optimism in Europe. A closer look shows the sales outlook unchanged, however, with production cost cuts being credited with the raised outlook for the gross margin. French retailer Pinault-Printemps-Redoute reported fourth quarter earnings and net income that were characterized as being at the low end of expected numbers, with the stock falling in early trading this morning. The company will soon assume full control over Gucci. Perhaps the drop is also due to the failure to name Gucci CEO Domenico De Sole's successor, with that CEO and the creative director leaving the company, reportedly due to conflicts with PPR's management.

As of this writing, the FTSE 100 trades higher by 11.60 points or 0.26%, at 4397.30. The CAC 40 trades higher by 18.39 points or 0.51%, at 3643.62. The DAX has moved higher by 29.29 points or 0.76%, to trade at 3885.99. All are off their highs of the days, with the CAC 40 headed generally down since its open.

  Jeff Bailey   3/31/200,  12:12:18 AM
Please note ... Jim placed a day trade short entry al_rt in the futures side of the Market Monitor at 22:32:45. (I type this, only because I entered information on top of his trade, which you might not otherwise see.)

speaking of Jim's trade in the es04m, now I've GOT to show my updated es04m chart with the fitted retracement. Link

Can there be any question we're near a rather important near-term level of resistance?

  Jeff Bailey   3/31/200,  11:21:54 PM
S&P 100 (OEX.X) chart with new MONTHLY pivot retracement at this Link

Now here's the OEX chart, where after making an observation of how APRIL's MONTHLY R1 and S2 seemed to mark some inflection points for the BIG MOVE HIGHER from November to January. Link

My basis thoughts are this.... based on this blue retracement, a bullish bias looks to be holding above 549, where a break much above today's (Wednesday's) highs, the 561.28 has to be an upside target.

I do show in PINK a horizontal level dating WAY BACK to mid-May 2002, which was an inflection point of trade back then, when OEX seemed to traded either side, but used this level as support/resistance from time to time.

Gosh darn it! Look at the OEX bullish % ($BPOEX) in mid-May (between red 5 and red 6) of 2002, and look at similar bullush % action now. Link

While BULLISH RISK IS HIGH and internals are weakening right now, the bullish % was suggesting the same in min-May of 2002, but the HIGH level of BULLISHNESS may have kept juuuuust enough bullish enthusiasm for another pop higher.

Conclusion: A trader has to think OEX may still have upside potential to 561 near-term, with longer-term risk still below, perhaps to at least 510.

Is there something the MARKET is waiting for, some piece of information, that gives the MARKET the information it needs, to make the decisive move.

I want to say that the BULLISH % will win out near-term. It's alerting us to some type of weakness. However, the past couple of sessions have been a little stronger than I would have thought. Not OVERLY so, but just enough to keep a bearish trader honest.

  Jeff Bailey   3/31/200,  10:57:36 PM
Dow Industrials (INDU) with new MONTHLY Pivot retracement at this Link

WEEKLY R2 shows some past technical trade, and would be deemed near-term resistance. I get the feeling that bulls long above 10,428, if not 10,516, just as questionable, or tense as bears below WEEKLY R1 of 10,321 into nonfarm report on Friday. The bets are made, or will be made prior to tomorrow's close.

  Jeff Bailey   3/31/200,  10:30:10 PM
QQQ with new MONTHLY pivot retracement at this Link

I think my swing trade bearish stop at $36.10 is a little tight. I was looking over to the left, where under a QQQ bounce circumstance, the QQQ did traded $36.12, then reverse quickly lower.

  Jeff Bailey   3/31/200,  10:28:52 PM
Pivot Matrix for tomorrow at this Link

DASHED BLUE may suggest some type of end of quarter balancing was the bulk of today's session. I'm not sure, but notable how today's close, within today's ranges, settle at MONTHLY Pivot.

  OI Technical Staff   3/31/200,  10:28:42 PM
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