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  Jeff Bailey   4/7/2004,  6:50:06 PM
NASDAQ-100 Tracker (QQQ) $36.94 .... now at $37.28.

  Jeff Bailey   4/7/2004,  6:49:21 PM
Intel (INTC) $27.69 -2.05% ... jumps to $28.16 in extended hours on DELL guidance.

  Jeff Bailey   4/7/2004,  6:48:33 PM
Dell Computer (DELL) $34.76 +0.20% ... jumps to $35.78 on increased quarterly guidance. Now sees Q1 sales at $11.4 billion, about $200 million higher than guidance provided on 02/12/04. Expects EPS of $0.28, which is inline with prior estimates. Company plans on spending $1.1 billion on stock buyback next 3 months, which is up from $600 million.

  Jeff Bailey   4/7/2004,  6:14:34 PM
Pivot Matrix for tomorrow at this Link

Those levels in BLACK show correlation.

Those levels either BLUE, or UNDERLINED have seen trade this WEEK or MONTH

  Jeff Bailey   4/7/2004,  4:55:52 PM
Closing Internals at this Link

  Jim Brown   4/7/2004,  4:47:09 PM
RIMM now down -$5.00

  Jim Brown   4/7/2004,  4:41:37 PM
AMZN +1.50, ASKJ +2.00, EBAY +1.50, MAMA +1.25

  Jim Brown   4/7/2004,  4:38:29 PM
California appelate court just returned a guilty verdict against the tobacco industry

  Jeff Bailey   4/7/2004,  4:37:18 PM
QQQ $36.94 -0.1% ... $37.12 here.

  Jeff Bailey   4/7/2004,  4:35:52 PM
Yahoo! Inc. (YHOO) $48.35 -0.86% Link ..... jumps to $51.90 on earnings.

  Jim Brown   4/7/2004,  4:31:13 PM
YHOO est = +0.11, actual = +0.14 announced 2:1 split, raising guidance for quarter and year

  Jeff Bailey   4/7/2004,  4:25:58 PM
Genentech (DNA) $108.45 Link ... halt lifted.... $110.00

  Jeff Bailey   4/7/2004,  4:10:18 PM
Research in Motion (RIMM) $107.98 -1.63% Link ... was halted with last tick at $108.50 in after-hours.

  Jeff Bailey   4/7/2004,  4:04:13 PM
PeopleSoft (PSFT) / Oracle (ORCL) Michigan Attorney General says it will block the ORCL/PSFT merger.

  Jeff Bailey   4/7/2004,  4:01:57 PM
Taser Intl. (TASR) $98.04 +6.27% Link ... in a world of its own, goes out just above the "fitted retracement" 61.8% level of $97.40. Afternoon bounce was to $99.89, so psychological $100 may be in play as near-term resistance.

  Jim Brown   4/7/2004,  4:01:00 PM
Earnings after the close:

DNA est = +0.32, actual = +0.33 (+.38 non-gap) 2:1 Split
RPM est = +0.06, actual =
CKR est = -0.08, actual = -0.01
CBK est = +0.21, actual = +0.22 revenue light
RIMM est = +0.50, actual = +0.52, ++guidance 2:1 split
YHOO est = +0.11, actual = +0.14, ++guidance 2:1 split

ERTS President resigned

Earnings before the bell on Thursday

GE est = +0.32
ABT est = +0.56
RAD est = +0.08
STI est = +1.23

  Jeff Bailey   4/7/2004,  3:59:26 PM
Bullish day trade close alert ADPT $9.06 here.

  Jeff Bailey   4/7/2004,  3:58:47 PM
Satyam (SAY) $2.31 -6.53% Link ... during the euphoria, bounced to $21.90, now back lower.

  Jeff Bailey   4/7/2004,  3:54:20 PM
S&P 500 Index (SPX.X) 1,140.68 -0.63% ... right back at DAILY S2.

Afternoon note is the bounce came close to DAILY Pivot of 1,146.56, but selling came in just before the sell program premium was generated, which had SPX falling right back to current levels of trade.

Darned QQQ's bounced above their DAILY Pivot ($37.05), which I didn't think they could do today (swing trade stop $37.10), but I got taken out with afternoon high of... $37.11. $&@#*$!!!!!

  Linda Piazza   4/7/2004,  3:54:09 PM
Just because it's interesting (at least to candlestick aficionados): Because yesterday's OEX candle completed an inside-day setup and because the OEX currently turns down, today has the possibility of completing the third candle in a reversal pattern known as a "Three Inside Down Bearish" pattern. To complete this pattern, today's close would have to be lower than yesterday's, which it appears it will be, although anything can happen into the close. Supposedly this is a highly reliable reversal signal. There's a problem, however, in addition to the one elicited by the frequent bearish reversal signals that failed to produce any follow through in the last year. That problem is that yesterday's candle should have been a true harami. That means that yesterday's total range should have been inside Monday's open and close, and not just inside its range. However, even the great Nison gives a little leeway in the patterns he describes if they're produced at resistance, as this one was, and especially if they're produced by an index, as this one was.

Perhaps it should be given even more leeway because the OEX looks to close back below its 50-dma. However, be careful about making any assumptions about what will happen tomorrow, on what may be a low-volume day before a holiday, especially when it's the last trading day before opex week begins next week.

  Jeff Bailey   4/7/2004,  3:49:26 PM
Adaptec (ADPT) $9.07 +0.22% .... Day trade bull close alert on trade back at break-even, otherwise, stop at $9.00.

  Jeff Bailey   4/7/2004,  3:46:45 PM
RF Micro Devices (RFMD) $8.69 +5.19% ... spiked up from $8.25 (02:10 PM) after CFO reiterated prior guidance. Noted in 03:15 PM Update. Link

This may have been somewhat responsible for late afternoon tech bounce.

  Jeff Bailey   4/7/2004,  3:41:05 PM
Sell Prog. Premium

  Linda Piazza   4/7/2004,  3:37:24 PM
An ominous sign, that OEX inability to maintain 559.50. The OEX has now zoomed back to mid-channel Keltner support and is trying to steady there. Whenever there's a stop-running push like the one we just had and the higher levels can't be maintained, there's a danger that bulls will become worried and bears will be encouraged, and that the drop will actually steepen. A lot depends on what happens at mid-channel support now. Maybe. Or maybe the OEX will just zoom around a bit more.

  Linda Piazza   4/7/2004,  3:29:36 PM
So far, the OEX hasn't been able to maintain levels above 559.50 since it began its climb.

  Linda Piazza   4/7/2004,  3:24:54 PM
Upper Keltner resistance on the OEX bumped higher when the OEX did, too, and that resistance is now at 561.13. The OEX is trying to pull free of the last bit of Keltner (and historical) resistance ahead of a dash to the upper channel resistance, but it's not having much luck doing it yet.

Speaking of dashing, I feel as if I've just been writing about a dash one direction and a dash another direction and a lot of nothing in between today. I started the day without a good handle on what might happen. As I mentioned early this morning, I used to chastize myself for not being able to form a firm opinion of likely market action before the market opened, but soon learned that those were often the very days when markets had difficulty deciding on a direction. I finally decided that it wasn't that I couldn't make up my mind and was missing clues, but that the markets couldn't make up theirs and weren't giving out any clues for me to find. Of course, sometimes I'm just having a bad day and miss all kinds of clues!

  Jeff Bailey   4/7/2004,  3:17:45 PM
03:00 Internals at this Link

  Jeff Bailey   4/7/2004,  3:11:08 PM
Bearish Swing trade stopped alert QQQ $37.10 ...

  Jeff Bailey   4/7/2004,  3:08:26 PM
Bearish day trade stopped alert SAY $21.46

  Linda Piazza   4/7/2004,  3:07:41 PM
I mentioned earlier that the HMO was doing a better job at approximating a strong bounce than some of the other indices (at that time). The TRAN is also doing a better job, climbing slowly and steadily from mid-morning on, and then jumping strongly about 15 minutes ago. That jump took it almost all the way to 2980-ish resistance.

  Linda Piazza   4/7/2004,  3:02:34 PM
Here's what's been happening based on the ascending regression channel that the OEX broke through this morning: Link

  Jeff Bailey   4/7/2004,  3:01:17 PM
Buy Prog. Premium.

  Jeff Bailey   4/7/2004,  2:57:58 PM
I'm tapped out for tracking my trades at this point Traders need to honor all profiled targets/stops.

  Linda Piazza   4/7/2004,  2:57:45 PM
The OEX just broke above the consolidation zone that's been containing its movements most of the day. It broke all the way to mid-channel Keltner resistance. Let's see if that holds or if the OEX is on its way back to the top channel resistance at 560.92 currently.

  Jeff Bailey   4/7/2004,  2:56:05 PM
Buy prog. prem.

  Jeff Bailey   4/7/2004,  2:55:40 PM
Day trade long alert .... Adaptec (ADPT) $9.11 here, stop $9.00, target $9.25.

  Jeff Bailey   4/7/2004,  2:53:01 PM
QQQ $36.87 -0.27% ....

  Jeff Bailey   4/7/2004,  2:52:31 PM
Russell 2000 Index (RUT.X) 599.53 +0.03% ... first major index to turn green here.

  Linda Piazza   4/7/2004,  2:51:39 PM
Jim's comment in his 14:41 futures post about the change in leadership prompted me to take a look at the HMO, the Morgan Stanley Healthcare Index. Since about 10:55, the HMO has steadied, created a double-bottom formation on the five-minute chart, more than achieved the upside target on that chart, and continued climbing. However, it's climbing after a steep drop, and it hasn't yet quite reached the 50% retracement of this morning's steep drop, so we can't safely say that it's anything more than a possible bear-flag rise off this morning's low. It's sure doing a better job at approximating a bounce than some of the indices, however. Are investors getting more defensive? Could be. The HMO has been climbing strongly over the last week, zooming higher on Monday. There's danger, though, that it's on its way to producing a reversal signal. Watch for a fall out of the current flag-type rise and a subsequent move below the midpoint of Monday's range as a sign that such a reversal could be beginning. I wouldn't take such a reversal too seriously, however, as it just looks as if the HMO has outstripped itself and needs to come back and establish support again. Watch for the HMO to hold above the midpoint of Monday's range as a sign that this is normal consolidation.

  Jeff Bailey   4/7/2004,  2:50:27 PM
Semiconductor Index (SOX.X) 507.39 -0.13% ... Almost back to unchanged.

LLTC +1.41%, ALTR +0.73%, XLNX +0.68%, NVLS +0.51%

  Jeff Bailey   4/7/2004,  2:46:43 PM
Seagate Tech. (STX) $14.82 -4.93% Link ... session low came at the opening ticks of $13.00.

I count bearish vertical count as $10.

  Linda Piazza   4/7/2004,  2:38:17 PM
The OEX 30-, 60-, and 120-minute oscillators remain inconclusive. If I study the charts closely enough, I can see that 30-minute CCI is turning up, but it's doing so while the OEX consolidates, so that's not a bullish action. (It's showing that the OEX can't make any upward traction while there's an ongoing upward push, so that it might be suspected that a downward push will spiral it lower.) Right now, the evidence isn't strong either direction. CCI heads lower on the 60-minute chart, and since the OEX consolidates, that's not a bearish action. That's contradictory evidence provided across these two time frames. On the 120-minute chart, MACD has made a more conclusive bearish cross with accompanying negative histogram values, but the cross was made from above signal, so it's less bearish a signal than it might be otherwise. I don't know about you, but I'm not getting strong evidence either direction here.

  Jeff Bailey   4/7/2004,  2:36:24 PM
Satyam Comp. Serv. (SAY) $21.37 -6.27% ... just under RED #3 of $21.40.

  Jeff Bailey   4/7/2004,  2:35:14 PM
Disk Drives (DDX.X) 127.83 +0.07% .... edging up to positive territory. DSS +5.44%, SNDK +2.6%, ADIC +1.27%, ADPT +0.44%.

Networking (NWX.X) 283.30 +0.43% ....

Some bid coming into tech.

  Jim Brown   4/7/2004,  2:27:36 PM
Remember, IP, T and EK will be removed from the Dow at the close. This could cause us to dip even further at the close assuming we don't see a rebound in the other 27 stocks to offset the changeover.

  Jeff Bailey   4/7/2004,  2:21:08 PM
IPIX Corp. (IPIX) $9.46 -4.92% Link ... Could you please take a look at IPIX. It has had quite a run lately. They make a proprietary 360 degree camera. Quite a run in the last week. Started out as internet Pictures during the Dotcom. Has been able to hang on. Buy? or sell at this level. Interesting chart.

I protect gains if long (sell), let stock settle down, maybe build some consolidation ($5.63-$6.78) next couple of weeks.

  Jane Fox   4/7/2004,  2:09:45 PM
Dateline WSJ HOUSTON -- The wife of former Enron Corp. finance chief Andrew Fastow withdrew a plea agreement Wednesday after a federal judge balked at a sentencing deal that would have sent her to prison for five months and confined her at home for another five months.

The proposed sentence for Lea Fastow, rejected by U.S. District Judge David Hittner, was part of a larger plea deal involving her husband's criminal case.

However, prosecutors have said that any change in Ms. Fastow's case wouldn't affect her husband's plea agreement. He was to face 10 years in prison on two counts of conspiracy and had agreed to cooperate with prosecutors pursuing cases against higher-ups.

  Jeff Bailey   4/7/2004,  2:07:53 PM
Taser Intl. (TASR) $97.00 ... 100.30 was high for session. Back at BLUE #1 here.

  Linda Piazza   4/7/2004,  2:05:26 PM
Last week, the GSO, the GSTI Software Index, began a tentative break above a descending trendline that had been in place since mid-January. That breakout strengthened. Yesterday, that breakout carried the index high enough that it opened at the bottom of another former trendline, this one an ascending trendline that had been building since last summer. That long-time support proved to be strong resistance. Since yesterday morning, the GSO has been turning down, perhaps to come back and retest the trendline it just broke through last week. That trendline crosses at about the same level as the 50-dma, currently at 153.90.

  Jeff Bailey   4/7/2004,  2:05:05 PM
Dow Industrials (INDU) 10,467 -1% ... session low

  Linda Piazza   4/7/2004,  1:56:54 PM
KO appears to be testing or breaking above historical horizontal resistance near $51.00 today, with the stock currently at $51.04. Be careful with this one, though, as what it appears to be doing isn't always what it's going to keep doing. KO sometimes does some strange things in the week before opex week and during opex week, breaking to the upside out of bearish formations or breaking to the downside out of bullish ones, only to turn around as soon as opex week has ended. It can move pretty fast and big for what you would think would be a stodgy old stock, too. The move over the last couple of weeks is taking it tentatively above trendlines that have been in place since 1998 and 1999, but KO has already had one breakout above that trendline in mid-February, only to see prices head back down below it and back into the symmetrical triangle it was building on its weekly chart. Be careful making assumptions because of KO's sometimes strange behavior for the last two weeks heading into opex week. KO currently has a $67 P&F upside target, but it starts running into some congestion from the monthly chart between $52-55.00.

  Jeff Bailey   4/7/2004,  1:54:34 PM
Networking Index (NWX.X) 282.05 (unch) ... just made an afternoon high of 282.61, and first technology sector to get back in the green this afternoon.

LU $4.43 +2.31%, ALA $16.82 +1.5%, TLAB $8.96 +1.47%, ADPT $9.09 +0.44%.

Cisco Systems (CSCO) $24.18 -1.86% ...

  James Brown   4/7/2004,  1:36:05 PM
Research in Motion (RIMM) is down $1.15 to $108.59 but still up strongly this week after the breakout above $100.00. The company is due to report earnings after the close with estimates at 50 cents a share. Considering the major earnings blow out last quarter expectations are running pretty high!

  James Brown   4/7/2004,  1:33:25 PM
Yahoo! Inc (YHOO) is down 47 cents to $48.30 and its technical oscillators are rolling over into bearish patterns. Investors have been taking a little money off the table these past two days ahead of tonight's earnings announcement after the closing bell. Estimates are for 11 cents a share.

  Linda Piazza   4/7/2004,  1:32:58 PM
The OEX has been in a tight range from 556.50 to about 557.60 since about 10:50. It had actually tightened within that tight range, coiling up into a symmetrical triangle. It's now broken over the top of that triangle, with that breakout, if it can be characterized as such with such a tight formation, not yet over the top of the 557.60 resistance level. Mid-channel Keltner resistance is now from 558.58 to 559.69 and is flattening.

  James Brown   4/7/2004,  1:28:26 PM
Sector Update @ 01:30 PM ET

Crude oil futures: +3.98%
OSX oil services: +1.87%
XNG natural gas: +0.54%
XAU gold & silver: +0.55%

(Biggest) Losers:
GHA hardware index: -1.73%
XAL airlines index: -1.80%
TRAN Dow transports: -1.15%
SOX semiconductors: -1.05%
CYC cyclicals index: -1.04%

  James Brown   4/7/2004,  1:24:38 PM
Bucking the trend today is News Corp (NWS), which is up 1.76% to $38.09. The stock is still moving on yesterday's news that the company will move its headquarters to the U.S. and move its primary listing to the NYSE. Its short-term technicals look overbought with its nearly non-stop run from $34.00 to $38.00 in the last several days. Bulls might want to consider a dip toward its 50-dma near $37.00 as a potential entry point.

  James Brown   4/7/2004,  1:19:05 PM
Longer-term players can check out Hasbro Inc (HAS), the toy maker. The stock broke out over resistance at $23.00 yesterday to hit new 4-year highs on twice the average volume.

  James Brown   4/7/2004,  1:16:30 PM
Have you finished your Easter shopping for candied eggs and chocolate bunnies? Check out Hershey Foods Corp (HSY). The stock has found support at its simple 40-dma for the last two weeks and its MACD is about to produce a new buy signal. Although one concern might be some post-holiday depression. Earnings are April 22nd.

  Linda Piazza   4/7/2004,  1:15:00 PM
For the last three days, the BIX has been finding support at its 100-dma at 343.34, but for the last couple of days, it's also been finding resistance at the 72-ema I've been watching.

  Jeff Bailey   4/7/2004,  1:14:10 PM
01:00 Internals at this Link

  James Brown   4/7/2004,  1:11:59 PM
Check out this chart on Sysco Corp (SYY) Chart: Link The stock may be signaling a new bullish entry soon.

  Linda Piazza   4/7/2004,  1:10:01 PM
SIRI approaches its $4.20 high of 1/05, with SIRI at $4.06 as I type.

  James Brown   4/7/2004,  1:07:42 PM
GCI looks like a tempting bullish candidate with the recent breakout over resistance a $90.00. The breakout is confirmed on its P&F chart ($102 price target). However, traders should note that earnings are coming up quick on April 12th (next Monday) and we don't like to hold positions over an earnings announcement.

  James Brown   4/7/2004,  1:05:16 PM
Dow component UTX is still moving higher and creeping toward resistance at $90.00 despite losing the Boeing Dreamliner engine contract to GE and Rolls Royce yesterday. UTX's P&F chart looks pretty bullish with a new rebound above P&F support. Currently it's pointing to a $102 price target. UTX earnings are expected in two weeks.

  Jeff Bailey   4/7/2004,  1:03:46 PM
Taser Intl. (TASR) $100.00 ...

  Jeff Bailey   4/7/2004,  1:03:15 PM
Bearish lower day trade stop alert for SAY $21.24 -6.84% to $21.46.

  Linda Piazza   4/7/2004,  12:59:19 PM
What's stalled the OEX descent? Possibly it's the 120-minute 21-pma, with that average at 556.82. A fall much below this average and today's low may send the OEX down to retest the 120-minute 100/130-pma's, with those averages currently at 553.41 and 553.95, respectively.

I began watching the OEX with respeect to this longer-term chart a while ago, when I noticed how the OEX traded with respect to the averages on that chart.

  Jim Brown   4/7/2004,  12:58:35 PM
Rumor hitting the wires that the Terror Alert is about to be raised for the weekend

  Jeff Bailey   4/7/2004,  12:57:57 PM
Bema Gold (BGO) $3.38 -2.31% .... technicals.... slips below its 50-day SMA, and testing an upward trend from the 02/02/04 relative low.

  Jeff Bailey   4/7/2004,  12:56:38 PM
Newmont Mining (NEM) $45.68 +0.83% ...

  Linda Piazza   4/7/2004,  12:49:51 PM
The OEX is trying to steady, but while it's doing so, the lower Keltner support is snaking lower, with that support now at 556.18. I had actually expected the OEX to rise higher before attempting to move lower again, but we're now moving into the lunchtime lull period when anything can happen. Mid-channel resistance has now moved down to 558.81 and is still dropping.

  Linda Piazza   4/7/2004,  12:40:29 PM
Reader Question: What's your opinion on the XLB? I see a possible H&S pattern on the daily chart.

Response: This question comes from an experienced trader whose opinion I always trust, and when I looked at the chart for the Materials SPDR, the XLB, this is what I saw: Link It's possible to draw several different versions of the neckline, and even if a H&S is going to be confirmed, sometimes two right shoulders are produced. A move much above $27.10 would negate the potential for this formation.

We've seen lots of these potentially bearish formations fail to confirm or fail to reach their downside targets when they do confirm, but I know this trader is experienced enough to watch carefully and make appropriate account-management decisions. One recommendation for this traders' strengths is that he's even watching the materials index.

  Jeff Bailey   4/7/2004,  12:31:06 PM
Bearish lower day trade stop alert for Satyam Comp. Srv. (SAY) to $21.80 now.

Stock trades $21.31 -6.53% here, where current lows may be finding some 50-day SMA (on the daily interval bar chart). Link

  Jim Brown   4/7/2004,  12:29:46 PM
That reader with the $180,000 of TASR April $100 calls yesterday afternoon is doing well today. (average cost $1.15) My advice, take the money and run. Link

  Jeff Bailey   4/7/2004,  12:27:33 PM
TASR intra-day chart ... per traders' request at this Link

  Linda Piazza   4/7/2004,  12:15:38 PM
Here's one reason I don't trust inside-day theory. On Friday and Monday, the TRAN produced an inside-day setup. Yesterday, the TRAN broke over the top of yesterday's high, producing a bullish signal by inside-day theory. Today, the TRAN plummets, rolling down beneath the 2980-ish resistance and then falling beneath the 2960 S/R level, too. The TRAN is holding above the 100-dma at 2925, so far at least.

  Jeff Bailey   4/7/2004,  12:14:38 PM
S&P 100 Index (OEX.X) 556.69 -0.87% .... here's updated bar chart with WEEKLY/MONTHLY pivot retracement. Link

Looking 554-552 here.

  James Brown   4/7/2004,  12:13:02 PM
Dow component Intel (INTC) is down 2.72% to $27.49 and under what should have been minor support at $28.00.

  James Brown   4/7/2004,  12:11:46 PM
The SOX semiconductor index is creeping ever lower toward the 500 mark. Currently it's down 7.15 points to 500.92.

  Jeff Bailey   4/7/2004,  12:04:51 PM
Per Jim's 12:02:49 I wouldn't have wanted to be short since about $61!!!

  Jim Brown   4/7/2004,  12:02:49 PM
I just heard that there is no TASR available to short at a couple different brokers. Definitely a squeeze in progress. I would not want to be short today.

  Jeff Bailey   4/7/2004,  11:59:00 AM
Taser Intl. (TASR) $98.60 +7.15% .... MARKET might be thinking "$100 at least" (90% of stocks that trade $90 trade $100). Here's updated chart shown earlier this morning. Link

Decided to take a shot with CALL OPTIONS on trade at $97.40.

  Linda Piazza   4/7/2004,  11:53:43 AM
Thanks, Jane, for your 11:37 answer to the reader's 11:25 question about how an apparent gap that wasn't actually a gap would be treated on the NQ. Since trades actually took place in that space during the overnight session, I thought the conclusion would be that the gap actually did not exist and should not be treated as a gap, but wanted confirmation from a futures trader. I know there's some question about whether overnight levels are used for some calculations.

  Jeff Bailey   4/7/2004,  11:50:07 AM
Swing trade long alert ... the TASR April $115 calls (QURDC) $1.60, no stop, target $3.20. (agressive bulls only!!!!) (4 contracts for my weekly market monitor table, I may leg out (sell) 2 if I get $2.40 bid)

  James Brown   4/7/2004,  11:49:41 AM
Yesterday CNBC mentioned the Wal-Mart (WMT) story in Inglewood, CA where the company was going straight to the public to vote on WMT's desire to build a supercenter there. The result of that vote was a big NO. More than 60% of the voters did not want WMT to move in and build a supercenter store, which include groceries in addition to their normal line of goods.

  Linda Piazza   4/7/2004,  11:49:17 AM
Oops. That apparently wasn't the closing value for the FTSE 100 in my 11:46 post after all. I jumped the gun a bit on that one. The FTSE 100 moved lower, but is still only 4.10 points in the red.

  Jeff Bailey   4/7/2004,  11:47:56 AM
Taser Intl. (TASR) $96.74 +4.71% ... just checking in.... Each time I look at its chart, I can't help but laugh in disbelief. It's amazing what stocks can do on the upside (when in favor) and on the downside (out of favor).

  Linda Piazza   4/7/2004,  11:46:10 AM
The European markets we watch failed to hold onto their gains today, gains which had seemed counterintuitive based on developments in Europe today. The FTSE 100 ended the day flat, down 2.20 points or 0.05%, at 4470.60. The CAC ended the day down 11.55 points or 0.31%, at 3734.56. The DAX ended down 21.65 points or 0.54%, clinging to the 4000 level, at 4001.16. These bourses were diving into their close, with the FTSE closing on its low of the day, the DAX closing less than a point above that low of the day, and the CAC managing only a slightly larger bounce off that low. Italy, the subject of the EU's ire over their growing deficits, moved lower by 0.33%.

  Jane Fox   4/7/2004,  11:37:15 AM
Linda (11:25 post) you are absolutely right about NQ trading all night, actually this market closes at 4:15ET and reopens at 4:30ET. So gap analysis in a market like NQ does not make sense since there really is no gap. The gap does not show up on the daily charts because most charting services (at least Qcharts) includes the overnight session in its daily bars.

  James Brown   4/7/2004,  11:34:53 AM
A couple of days ago CVS Corp, the retail drug store chain, jumped on news that it had purchased the southern half of JCP's Eckerd drug store chain. Evidently A.G.Edwards isn't so inspired and downgraded the stock from "hold" to a "sell" this morning. Shares of CVS are down 18 cents to $36.96.

  Linda Piazza   4/7/2004,  11:34:50 AM
The OEX fell out of the most current bear-flag, but it looks to me as if it might actually just be forming up into a slightly wider bear flag, one that might climb a little higher. We'll know soon, though, because a new low of the day will ruin that theory.

  James Brown   4/7/2004,  11:29:44 AM
Wild Oats Markets Inc (OATS) is up 9.31% to $14.67 after Smith Barney upped the stock from "hold" to "buy" and raised its price target $2 to $17. OATS has completely jumped over the gap down in late February.

  Linda Piazza   4/7/2004,  11:25:57 AM
Reader Question: I thought you might have an answer to this question. There is a recent gap that shows up on the NQ-Hourly (1159.00) that doesn't show up on the Daily chart. Does the "fill the gap" theory come into play on the shorter term charts, or is it primarily used on Daily charts?

Response: Since I don't trade futures or focus as much on the Nasdaq-related indices as some others, I may not be the best person to address a gap on the NQ, but I can talk generally about gap theory. Fill-the-gap theory can be a factor on intraday charts as well as on daily chart, although there are all sorts of considerations such as whether a gap might be a breakaway, running, or exhaustion gap. Some might be more likely to be retraced than others. On Stockcharts.com, you can find a glossary that includes a discussion of the different types of gaps.

Taking a look at the "all sessions" trade on the NQ, however, that gap disappears. Trades actually took place in that gap during the overnight session, but are just not visible when you're not viewing "all sessions." I would not necessarily consider that a true gap, then. Do any of the futures writers have an opinion on this matter?

  James Brown   4/7/2004,  11:25:35 AM
Raymond James upgraded home improvement retailer Lowes Co (LOW) to a "strong buy" this morning but it's not helping the stock. Shares of LOW jumped at the open to $55.99 and immediately began falling. Currently today's candle is a bearish engulfing pattern.

  James Brown   4/7/2004,  11:20:05 AM
The Mortgage Bankers Association of America said their most recent survey showed mortgage loan apps dropped 7.2% for last week. Looking at the internals the move was driven by a 15% drop in refinancing applications. During the same time period 30-year fixed mortgages rose from 5.49% to 5.74%.

  Jim Brown   4/7/2004,  11:15:50 AM
Excerpt from an email I received:

TASR - "It would really be a shame if this stock bubble bursts and so many investors lost their money like the past bubble era.."

This is NOT a stock for investors. It is a stock for gamblers and anybody "investing" in TASR must be willing to lose all or part of their investment at any moment. A PE of 250 has never been sustainable in the history of the stock market. Taser products have been around for 20 years. They are only gaining visibility because of the company hype and a slightly larger audience produced by terrorist concerns. It is not new technology.

Remember Qualcomm at $1000? QCOM is 50-100 times bigger than Taser and has a mass market product. QCOM earnings are nearly 200 times larger than TASR.

If you are playing TASR you are gambling not investing. Don't kid yourself and don't do it without stops. One reader we traded emails with yesterday had $180,000 in TASR April $100 calls. Is he investing or gambling? You decide.

  James Brown   4/7/2004,  11:14:26 AM
Guidant (GDT) has issued a press release this morning stating the company has won an FDA approval for a smaller version of one of its implantable cardiac defibrillators (ICD). GDT is calling it the Vitality 2 model. The stock is down 90 cents to $67.24.

  Jeff Bailey   4/7/2004,  11:08:47 AM
June Light, Sweet Crude (cl04m) $35.00 +1.80% ... big jump from $34.20 in last 15 minutes.

  Jeff Bailey   4/7/2004,  11:07:26 AM
11:00 Internals at this Link

Jump in gold

  Linda Piazza   4/7/2004,  11:07:00 AM
So far today, the OEX has fallen, steadied in a short distribution pattern that endured for 20-30 minutes, and then fallen again, certainly a bearish pattern. This is the first time that the OEX has touched bottom Keltner support, however, so I would expect a somewhat more prolonged or higher-reaching attempt at a bounce. A 50% retracement of the flagpole drop lies at about 559, a level of historical S/R, too. Those who believe in a bullish thesis want to see the OEX climb above that level and sustain levels above it, while bears want to see any possible flag or other formation break to the downside before or upon reaching that high. Mid-channel Keltner resistance is just above that, at 559.51 but descending.

  James Brown   4/7/2004,  11:05:02 AM
Sector Update @ 11:00 AM ET

XAU gold & silver: +0.96%
Crude Oil futures: +1.80%
DRG drug index: +0.20%

(Biggest) Losers:
XAL airlines index: -2.25%
GHA hardware index: -2.08%
SOX semiconductors: -1.25%
CYC cyclical index: -1.16%
HMO healthcare index: -1.00%

  Linda Piazza   4/7/2004,  11:01:01 AM
TASR appears to be generating a lot of interest among our subscribers lately. One who follows news reports closely and does much research into the positions he's considering or employing wrote about some of the recent news coverage. I haven't verified his accounts of the news, but his impression of the interview with TASR's CEO Rick Smith as seen on CNBC this morning was that Smith essentially was saying the individuals died due to overdose on drugs anyway. This reader asks, "[W]ould this not [still] create a legal issue?" He noted that Dan Rather's CBS coverage Monday night showed actual footage in which a police officer used a stun gun on a suspect within approximately twenty feet, and questioned whether that "method might be used more often and then we could see more negative results such as deaths [of] addicted drug users." He wondered whether this issue might pressure the stock more as the issue was further researched. He concluded by saying, "It would really be a shame if this stock bubble bursts and so many investors lost their money as in the past bubble era."

Other writers have commented today on TASR's climb, and Jeff has posted a new fitted retracement bracket that hints at a much higher upside target for TASR. Don't let that upside target keep you from honoring your stops, however, if in bullish plays. I've commented many times that this is a stock that scares me, and movements are becoming more violent, not less. That's often a sign of emotion-based trading, and it can be one sign of an impending reversal, whether temporary or otherwise, but then TASR has been giving off those signs for a long while without reversals occurring or going on too long when they do occur. That would have been small consolation for those who might have been long TASR on February 12, holding into the close as it reached yet-another new high. They might not have felt so great about TASR's temporary retreat to establish support as they watched their ITM 65, 60, and 55 calls go out of the money by Thursday of opex week. TASR headed up again that opex Friday, but not enough to save holders of 65 calls or recoup lost time-premium on the others. As we near opex week and a long weekend, be especially careful if holding OTM TASR calls. Yesterday was a big-volume day (capitulation by shorts?) producing a tall white candle, with today's trading pattern continuing the possibility that today's could be the second possible candle in a potential three-candle reversal signal. Please don't use that information to jump into a short position on TASR, because TASR has given off lots of verified and confirmed reversal signals without ever reversing, but do use it to manage risk if in a long position, especially with front-month options.

  Linda Piazza   4/7/2004,  10:47:59 AM
The OEX is now touching bottom Keltner support, and should bounce, but now the question is, "How far?" Strongest Keltner resistance is now at about 559.60 and has begun to descend, with that level matching a level of historical S/R, too.

  Jeff Bailey   4/7/2004,  10:47:13 AM
S&P Banks Index (BIX.X) 344.10 -0.44% ... never could quite get a higher trade at its WEEKLY pivot of 345.96, with morning high of 345.69.

  Jeff Bailey   4/7/2004,  10:45:35 AM
Semiconductor Index (SOX.X) 501.73 -1.30% ... WEEKLY Pivot here.

  Jeff Bailey   4/7/2004,  10:41:24 AM
DR Horton (DHI) $32.57 -0.36% ... technical .. testing a rising 50-day SMA

  Linda Piazza   4/7/2004,  10:32:22 AM
The OEX hasn't been able to gather enough strength for a bounce attempt, with consolidation in the form of tiny five-minute candles while the 5(3)3 stochastics cycle higher. That's not a good sign for the bulls if it continues, but the OEX does appear to be mounting a bounce attempt now. Keltner resistance has fanned out from the current OEX position to the 559.90 level. Sometimes when those levels fan out like that, the OEX has an easier time rising.

  Jeff Bailey   4/7/2004,  10:32:03 AM
Day trade short alert ... Satyam Computer Services (NYSE:SAY) $21.66 here, stop $22.30, target $20.55.

  Jeff Bailey   4/7/2004,  10:27:52 AM
10-year YIELD ($TNX.X) lower by 2.8 basis points at 4.142%. This is VERY close to Friday's nonfarm payroll close. Will monitor some of the interest sensitive and high yield action today, look for firming.

  Jeff Bailey   4/7/2004,  10:25:08 AM
10:00 Internals at this Link

Yesterday's Internals at this Link

  Linda Piazza   4/7/2004,  10:14:21 AM
It looks as if it's time for an OEX bounce, with strongest Keltner resistance now gathering just under 560, but with some resistance at 558.50-558.83 and 559.27. A failure to attempt a bounce should send it down to bottom Keltner channel support.

  Jeff Bailey   4/7/2004,  10:10:42 AM
DAILY S1s being tested QQQ $36.85 -0.35%, INDU 10,509 -0.58%, SPX 1,141.73 -0.56%.

  Jeff Bailey   4/7/2004,  10:09:06 AM
Broad sector weakness early ... Airline (XAL.X) 58.88 -1.45%, Oil Service (OSX.X) 99.33 -1.24%, Biotech (BTK.X) 539.94 -1.12% early leaders to downside. Will monitor BTK.X for QQQ trade, as it too has similar gap as noted in QQQ.

Strength is Drugs (DRG.X) 327.81 +0.18% and Gold ($HUI.X) 102.82 +0.39%.

  Linda Piazza   4/7/2004,  10:07:04 AM
It looks as if a trip down to bottom Keltner support, currently at 557.24, may in the works after all. I'd thought it was about time for that to happen, but said earlier today that market makers hadn't consulted me. The OEX has broken below yesterday's low, so would have triggered a bearish play for those who subscribe to the inside-day theory, and it has also broken below the ascending regression channel that had been holding since late March. Be careful, though, as this still feels a little like a market that's trying to sort out direction.

  Jeff Bailey   4/7/2004,  10:04:10 AM
Sell Prog. Premium

  Jeff Bailey   4/7/2004,  10:03:05 AM
QQQ $36.90 -0.21% ... here's a 60-minute interval chart (swing trade chart) of QQQ. Link

  Linda Piazza   4/7/2004,  10:02:15 AM
The OEX is trying to hold at next Keltner support, just above yesterday's low.

  Linda Piazza   4/7/2004,  9:59:00 AM
Another acquaintance and I were trading war stories yesterday about our trading experiences in March 2000. Everyone who was trading during that period has one, right? In my case, I jetted off to spend part of the month in Spain with my extended family, leaving my too-large open positions in the care of my trading partner, a trading partner who happened to believe in the "it will keep rising" and "if it drops, that's a good time to double up" theories. I checked in with him each day, but he was watching the markets and I was listening to his advice. Do I need to finish that story?

The current trading environment has reminded many of that period of time, although differences certainly exist as we're perhaps at a different point in an economic cycle. Perhaps not, but what worries me is that for a year, those "it will keep rising" and "if it drops, that's a good time to double up" theories have been working again, perhaps encouraging some risky behavior in those who have begun trading during that period of time. I had a wonderful holiday in Spain in March 2000, with the family time and memories more than making up for the money I lost by not attending to those OTM JDSU calls before opex, but it's not an experience I want our newer subscribers to share with me and with others who have war stories to share from March 2000. Be careful. Manage the size of your positions. Take profits when appropriate and lower risks. If a position moves against you, don't subscribe to the belief that "it has to come back." It doesn't have to.

  Jeff Bailey   4/7/2004,  9:52:59 AM
Russell 2000 Index ($RUT.X) 597.60 -0.28% ... slipping further below 600 at this point. Low of session. 50-day SMA is flat at 583 and correlative to mid-point of rising regression. May be time for a rest.

  Jeff Bailey   4/7/2004,  9:50:33 AM
Swing trade short alert for the QQQ $36.90 -0.2% here, stop $37.10, target $36.25.

  Jeff Bailey   4/7/2004,  9:48:21 AM
Disk Drive Index (DDX.X) 126.68 -0.89% ... Seagate Tech (STX) $13.30 -14.68% is not a component, but Maxtor (MXO) $8.02 -4.86% is notably weak among components.

FLSH $22.05 +0.86% and ADIC $11.80 +0.08% are sector gainers.

  Jeff Bailey   4/7/2004,  9:43:23 AM
Taser Intl. TASR $94.63 +2.97% Link ... just noting (per 09:39:55), that point and figure chart currently building a bullish vertical count to $130.

  Linda Piazza   4/7/2004,  9:41:35 AM
So far, the OEX pattern has not triggered a bearish trade according to inside-day theory, and the OEX is also holding above yesterday's support and within the ascending regression channel that's been in place since late March. Because the OEX has hugged the top Keltner channel resistance so long, it's about time for the OEX to retreat to the bottom Keltner-channel support, but that's just my opinion, and the market makers have not consulted me this morning, and so far, nothing disastrous has happened. That bottom support is at 557.40 currently, with Keltner support between the current OEX level and that level, at 559.32.

  Jeff Bailey   4/7/2004,  9:39:55 AM
Taser Intl. (TASR) $94.68 +2.39% ... here's a chart where I've "fit" a retracement to give traders some higher and lower levels. Link

  Linda Piazza   4/7/2004,  9:35:46 AM
During the first five minutes of trade, the OEX spanned a range from 561.58 to 559.97. Mid-channel support on the Keltner channels on the five-minute chart lies at 559.995, so that this move constitutes a challenge of that support.

  Jeff Bailey   4/7/2004,  9:29:29 AM
Semiconductor Index (SOX.X) chart with WEEKLY/MONTHLY pivot retracement at this Link

  Linda Piazza   4/7/2004,  9:15:36 AM
On Tuesday just before the close, the OEX inched above the 38.2% retracement of the bear-market decline to close just above that important retracement level. I'd mentioned late Monday and early Tuesday that big-range days were often followed by smaller-range consolidation days, and that's what we got on Tuesday. That smaller-range day produced an inside-day setup, a harami to candlestick enthusiasts. Such a setup, in which one day's range is completely contained within the previous day's range, is usually indicative of indecision. That indecision hooked the daily RSI down, but didn't create a bearish cross in either the MACD or the stochastics. Neither so much as flattened.

The 120-minute, 60-minute, and 30-minute oscillators are about as inconclusive as it's possible for them to be, which isn't unexpected when the daily candlestick configuration displays indecision. Adding to the confusion, the 120-minute chart shows an evening-star reversal signal confirmed early yesterday morning, but subsequent trading that undid the bearishness of that signal. The 60-minute chart shows a test of the 60-minute 18-pma, with candles then finding support and climbing along that moving average. The 30-minute chart also shows a test of the 18/21-pma's with the OEX so far finding support along those averages, although perhaps less convincingly, as candle are small and many sport upper shadows. Removing moving averages, envelopes, Donchian channels, and other technical analysis tools from the OEX 30-minute chart shows this, however: Link That chart shows that the OEX still trades safely with the ascending regression channel established at the end of March. Another fall below 559.50 will knock the OEX out of that channel, but I'd wait for a drop below yesterday's 559.10 low before betting too strongly that the drop was anything more than a test of that support. A drop below yesterday's low will confirm a lower high on that chart, however, and would also trigger a bearish play for those who are aficionados of inside-day theory.

A break above yesterday's high would trigger a bullish trade to those who are aficionados of inside-day theory. I've mentioned several times in the past that I'm not a particular fan of this theory, although many are, because I've seen a few too many false breaks that head right back down again. According to that theory a stop would be set at the previous day's low.

As several of us have been saying, gains will be harder from this point on, both because of the possibility of an earnings disappointment or terrorist worry and because many indices are moving into congestion zones just beneath trendlines off this year's high. On the OEX, the uppermost of those descending trendlines off the January high now crosses at about 569.50, but there are other versions possible, cutting off an upper shadow or two and crossing lower than 569.50. Some other indices have already reached analogous descending trendlines, with the Nasdaq having already broken above its analogous trendline and the Dow moving up yesterday to challenge its version, as Jim pointed out in last night's Wrap. The Russell 2000's and Wilshire 5000's trendlines are not completely analogous, but both turned down at or moved below important trendlines. It may be the behavior of those indices and not the OEX itself that determines what happens to the OEX next.

I'm uncertain about what to expect next. I used to feel inadequate on mornings like this, feeling as if I were missing something important that should give me a clue as to direction, but I've often found that such mornings are followed by days in which the trading action is confusing, too, so I've taken a cautious approach on days when direction might be unclear. I advise you do so today, too. While the OEX holds to the rising channel it established in late March, we should perhaps look at bullish plays on dips to support, but I'd sure be cautious about the size of my positions in this environment and be willing to honor my stops. Violations of that channel and a break below yesterday's low might be a possible bearish sign, but again I'd be cautious about the size of my positions and be willing to exit the position on a break back into the channel. Pay attention to TRIN levels and volume patterns and other such clues. I can see a scenario today where both bullish and bearish traders are stopped out of positions, but instead we may see a strong directional trade once again after yesterday's consolidation day. I'm just not certain what to expect.

  Jeff Bailey   4/7/2004,  9:14:47 AM
09:00 Update at this Link

  Linda Piazza   4/7/2004,  7:10:41 AM
Good morning. The Nikkei changed its game plan on Wednesday and gapped down instead of up. Throughout the morning session, it coiled itself into an ever-tighter formation between 12,000 and 12,040, ready to break out one direction or the other at the open of the afternoon session. That direction was up, with the Nikkei zooming up to a high of 12,097.70, just above the flat-line level. The climb reportedly resulted from a Moody's Investors Service's upgrade of the foreign currency-denominated debt rating for Japan to an Aaa rating from the previous Aa1. After hovering near the high for less than an hour, the Nikkei began a nearly straight fall back toward its opening level. The Nikkei closed down 60.08 points or 0.50%, at 12,019.62.

Although the upgrade was credited with helped some banks to gain, with the banking sector closing with a mixed performance, banks were already mostly higher in early trading. Tech weakness was countered by comparative strength in domestic-demand issues as money rotated again out of the sectors gaining favor earlier in the week and back into those that had been gaining favor last week. According to at least one article, Nokia's warning impacted sentiment in Japan, with that news hitting the stocks of Japanese companies that are either in the same space or that supply Nokia. TDK, Kyocera, and NEC all fit one of those two categories, and all fell in early trading, with at least TDK and Kyocera closing lower, too. Other tech stocks dropped, too, with chip-related stocks dropping in early trading. Some might have been subject to profit taking after Tuesday's 32-month high, but some also reacted to specific news. Perhaps in a sell-the-news effect or due to a disappointment that wasn't apparent in the headline news, Tokyo Electron dropped after Tuesday's announcement that it was raising its new profit forecast for the fiscal year that just ended and raising its dividend, too, and it closed lower, too, by 0.9%. Yahoo Japan dropped in early trading ahead of Yahoo's earnings announcement today, and by the end of the Nikkei's day-long round-trip back to its starting level, Yahoo Japan had dropped 4.5%. Fujitsu dropped early, too, and closed lower by 1.3%, perhaps in part due to a suit brought against Samsung for patent infringement, according to one source. The autos traded lower.

Other Asian bourses turned in a mixed performance, but most of the ones we commonly watch closed higher. The Taiwan Weighted gained 0.17%. Nokia's warning hit Samsung, a supplier, sending it down in early trading, with the stock perhaps also impacted by a suit Fujitsu has brought against the company claiming patent infringements. By the end of the day, however, Samsung had gained 0.8%, perhaps helping South Korea's Kospi post a 0.41% gain. Singapore's Straits Times gained 0.15% and Hong Kong's Hang Seng climbed 0.26%. China's Shanghai Composite declined, losing 0.17%.

Most European bourses currently trade higher, despite economic news that doesn't appear to be enthusiasm-engendering news. Today the EU lowered its growth forecast for the eurozone to a 1.7% growth rate. The EU's Monetary Policy Commissioner Solbes speaks as I type, with Solbes reportedly warning that six countries are not abiding by EU policy with respect to budget-deficit rules and issuing a special warning to Italy. Italy's deficit will reportedly grow to 3.2% this year, far above the EU's desired limit. The EU still describes its interest rate as accommodative, dashing any hopes that it might lower rates soon. In addition to that economic news, Germany's February factory orders rose 0.3%, a number lower than the expected 0.5% rise with the stronger euro causing a drop in foreign demand. In addition, Nokia received downgrades, but increasingly market watchers believe that the problem that led to the warning is a company-specific one rather than a sector-wide one.

Still, Nokia's warning may have been impacting chip makers, especially those that supply Nokia, with the chip makers flat. DaimlerChrysler dominates news today, too, as a result of its annual meeting. CNBC Europe and print articles variously discuss the concerns about the hit DaimlerChrysler will take to rescue Mitsubishi Motors as well as the enthusiastic assurances of its company spokesperson. Another newsmaker was German bank Commerzbank, gaining in early trading after saying that the first quarter had gotten off to a strong start.

As of this writing, the FTSE 100 has gained 24.70 points or 0.55%, to trade at 4497.50. The CAC 40 has gained 17.94 points or 0.48%, to trade at 3764.05. The DAX has climbed 23.23 points or 0.58%, to trade at 4046.04.

  Jeff Bailey   4/6/2004,  7:55:10 PM
Pivot Matrix for tomorrow at this Link

  OI Technical Staff   4/6/2004,  7:55:02 PM
The Market Monitor has been archived. You may view it and any previous days here: Link

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