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  Jeff Bailey   4/13/200,  5:48:01 PM
Closing Internals at this Link

 
 
  Jeff Bailey   4/13/200,  5:24:10 PM
Semiconductor HOLDRs (SMH) $40.83 -1.23% Link .... trades $40.74 in extended hours.

 
 
  Jeff Bailey   4/13/200,  5:16:37 PM
McDonald's (MCD) $28.27 -2.58% Link ... saying global sales increased 11.5% in March and 17.5% for Q1 compared to same periods in 2003. Guides Q1 EPS higher to $0.40 per share, 3-cents above consensus of $0.37.

 
 
  Jeff Bailey   4/13/200,  5:11:31 PM
QQQ went out at $36.63 -1.45%, trades down 2 cents at $36.61

 
 
  Jeff Bailey   4/13/200,  5:09:32 PM
Intel (INTC) $27.67 +0.25% ... ticking by at $27.48

 
 
  Jeff Bailey   4/13/200,  4:56:03 PM
Market Monitor Trade recap .... I should only have one trade position open at this time (IP swing trade short). Current week's table at this Link

For sum of columns under "%", I did NOT include the NEM April $45 covered call (NEM-DI).

The MACE trades were broken down into 1/2 positions where full position may have been either 1,000 shares, or $10,000 cash (used for account/trade management).

 
 
  Jim Brown   4/13/200,  4:20:46 PM
Intel update - Key Product Trends (Sequential)

Intel Architecture microprocessor units were lower. The average selling price was slightly higher. The average selling price excluding Xbox(a) processors was approximately flat.
Chipset units were lower.
Motherboard units were lower.
Flash memory units were higher. Flash revenue information is available in the supplemental financial information table that accompanies this release.
Connectivity product units were lower.

 
 
  Jeff Bailey   4/13/200,  4:16:17 PM
e-mini S&P futures chart at this Link

10-minute delayed quote

 
 
  Jim Brown   4/13/200,  4:15:19 PM
Earnings after the close:

INTC est = +0.27, actual = +0.26**
(includes -1.7 cents charge)
revenue light, guidance light

LLTC est = +0.25, actual = +0.27

Earnings before the bell on Thursday

BAC est = +1.80
DAL est = -3.02
HDI est = +0.64
ADTN est = +0.22
CCRD est = +0.01
MOGN est = -0.08

 
 
  Linda Piazza   4/13/200,  4:01:35 PM
The OEX ends the day just above the 72-ema I've been watching for a few months, with that average at 551.83. That average appeared to temporarily stop the OEX descent, but that may have just been an illusion. Let's see tomorrow.

 
 
  Linda Piazza   4/13/200,  3:59:29 PM
The indices are at a possible bounce point, important earnings to be announced tonight, opex week: those in front-month options plays need to make quick decisions about exiting or staying overnight, as it may be a roll of the dice as to whether those options are worth much tomorrow morning, whether in calls or puts.

 
 
  Linda Piazza   4/13/200,  3:47:36 PM
The OEX bounce, such as it is, looks a bit like the expected bear-flag rise, although it's a bit jagged and could still fall apart. Resistance lies at 552.40-553, both from Keltner resistance and from an extended descending trendline that's been holding back prices most of the day. Above that lies resistance at 553.66 and stronger resistance at 555.05-555.66.

 
 
  Jeff Bailey   4/13/200,  3:36:13 PM
Buy prog. premium

 
 
  James Brown   4/13/200,  3:35:33 PM
Sector update...

There are zero sector indices in the green.

(Biggest) Losers:
XAU gold & silver: -5.68%
XAL airline index: -2.46%
BTK biotech index: -2.47%
XBD broker-dealers: -2.61%
NWX networking index: -2.81%
INX Internet index: -2.57%
DDX disk drive index: -2.07%
BKX banking index: -2.15%

 
 
  Linda Piazza   4/13/200,  3:34:05 PM
My 14:40 post included a chart that showed the OEX resting on the 72-ema, along with my comment that this average had seemed to have had some correlation with the OEX's trading pattern lately. I was cautioning about yet-another bounce point being reached. Here's the latest shot: Link If the OEX does manage a bounce right here, as it seems to be doing, no matter how small, I'm going to be more convinced than ever that this average has some relevance.

 
 
  Ray Cummins   4/13/200,  3:29:17 PM
Spreads/Combos/Premium Selling -- "Early-Exit" Candidate: Leapfrog (NYSE:LF)

The maker of popular children's learning toys is in "rally mode" today after its stock was upgraded by an analyst who said the string of bad news from the educational toymaker might be over. Merrill Lynch analyst Lauren Rich Fine raised her rating on LF shares, saying that "While the stock would seem to suggest more bad news is anticipated, we doubt it." That's great for LF investors and even better for our recent debit straddle, which is now profitable after only one week in play. Conservative traders should monitor the issue for a favorable "early-exit" opportunity in the coming sessions.

 
 
  Jeff Bailey   4/13/200,  3:20:16 PM
03:00 Internals at this Link

 
 
  Linda Piazza   4/13/200,  3:16:04 PM
The problem now with determining support and resistance is that often-mentioned zoom up from late November to late January in the OEX. During the portion of that climb in which the OEX now trades, there just wasn't much of a pause anywhere to establish support or resistance. The only recent markers we have are those from March, with the OEX now entering a 449-452.60 zone that includes a number of opens, closes, highs, and lows from that period. Below that, there's some Fib support at about 547, but that level didn't seem important during March. Next historical support below the current level begins at about 542-544. I still wonder about a possible bounce attempt, however weak it might be, into the close.

 
 
  James Brown   4/13/200,  3:15:44 PM
This could be an aggressive bullish entry point on homebuilder DHI, which has sold off from its highs near $36 to historical price support at $30.00 and its technical support at the 100-dma. Of course the oversold trend is a good reminder not to try and catch a falling knife. Plus, I'd wait until after its April 14th earnings report to look for a bounce.

 
 
  Jim Brown   4/13/200,  3:12:46 PM
TASR Don't know if anybody heard but there was a story out this morning about margin rates being raised for TASR.

 
 
  Jeff Bailey   4/13/200,  3:11:11 PM
International Paper (IP) $41.58 -1.93% Link ... starting to give up its 21-day SMA. This has seen extended runs lower of late.

 
 
  Jeff Bailey   4/13/200,  3:08:34 PM
Taser Intl. (TASR) $94.40 -3.4% Link ... After morning trade at $100, would be showing a double-bottom sell signal should stop open at $96 or lower tomorrow. This would negate the current bullish vertical count.

 
 
  James Brown   4/13/200,  3:06:40 PM
It feels a little short-term oversold but Golden West Financial (GDW) is breaking through support at $105 and its 100-dma. Short-term bearish targets might be the $100 mark or the 200-dma near $98. Earnings should be 4/20.

 
 
  Jeff Bailey   4/13/200,  3:05:46 PM
NASDAQ Composite (COMPX) 2,030.04 -1.71% Link .... begins to backfill its nonfarm payroll gap.

 
 
  James Brown   4/13/200,  3:04:12 PM
It's a little premature but St. Jude Medical (STL) appears to be working on what looks like the right shoulder to a head-and-shoulders pattern. Earnings should be 4/21.

 
 
  Linda Piazza   4/13/200,  3:02:37 PM
The RLX has continued to drop, falling through the nearest support I mentioned in an earlier post and now headed toward 390. The daily chart indicates some recent S/R between 388-389, but the weekly chart shows strongest support down near 386-387, with the 100-dma below that at 383.57. The 21(3)3 stochastics indicate that the RLX could have far to go before it's oversold on that basis, although the 5(3)3's have already cycled down nearly to levels indicating oversold conditions. If they try to turn up again, there may be some choppy performance by this index with the two stochastics working against each other. RSI is in full bearish roll, but still at a rather neutral 45.92 level.

 
 
  James Brown   4/13/200,  2:59:23 PM
LEH, an OI put play, continues to fall and is down 4.5% and more than half way toward support near $75.

 
 
  Jeff Bailey   4/13/200,  2:57:35 PM
Mace Security (MACE) $11.03 +37.87% .... edging back above the $10.89 level. Last 5-minutes saw 908,308 shares traded.

 
 
  James Brown   4/13/200,  2:54:10 PM
Wells Fargo & Co (WFC) is breaking down under significant support at the $56 level but still has technical support at its 200-dma near $55.

The BIX banking index is breaking down under support at 340 while the BKX is testing technical support at its 100-dma.

 
 
  Jeff Bailey   4/13/200,  2:50:33 PM
S&P 100 Index (OEX.X) 552.64 -1.22% ... just off session low of 551.79, and important near-term support found of 552.00. (WEEKLY S1 552.12 and MONTHLY Pivot 551.81).

 
 
  James Brown   4/13/200,  2:47:14 PM
Investors continue to sell Wal-Mart (WMT) and the stock could close under its simple 200-dma for the first time in a couple of months.

 
 
  Linda Piazza   4/13/200,  2:40:36 PM
Remember that 72-ema that I've been following, saying that it seemed to have some correlation with the OEX's trading pattern? Here it is today: Link

 
 
  James Brown   4/13/200,  2:40:04 PM
Another bearish play is developing in Garmin Ltd (GRMN). The stock has been struggling the last few weeks and today's drop shoots the stock toward March support near $39.65-39.75. A trigger under this level might be a decent option. Earnings should be 4/28.

 
 
  Linda Piazza   4/13/200,  2:34:20 PM
Now you know why I like trading so much, Jim. (GRIN) Actually, I love writing, too, and enjoy this wonderful life that allows me to indulge the mathematically inclined part of my brain during the day and the fiction-writing part of my brain in the late evenings.

Back to the OEX: It's touching the top of that 552.25-552.80 zone that was resistance through much of March. This should be another bounce point, but so far, no bounce points have produced bounces. I just keep thinking about this whole last year's history, the profit that some short-term bears have in hand right now, and the earnings reports this evening, and wondering if there won't be a bout of short-covering into the close. That's just a puzzling through of what might happen and not a suggestion that it will.

 
 
  Jim Brown   4/13/200,  2:26:08 PM
Wow! 17 cents. That puts an entirely new focus on the process. Maybe the Guild should be pushing for a royalty on each used book. Amazon could easily do it. They have the ISBN number on every book sold and adding 10 cents to every used book sold would not hurt anybody.

 
 
  Linda Piazza   4/13/200,  2:25:11 PM
The OEX is approaching last-ditch near-term support as the VIX and VXO punch over their daily 100/130-pma's.

 
 
  Jeff Bailey   4/13/200,  2:25:06 PM
Swing trade short alert ... International Paper (IP) $41.68 here, stop $42.40, target $40.25.

 
 
  Jeff Bailey   4/13/200,  2:19:39 PM
NYSE 100 Index (NY) $61.32 -1.09% ...

 
 
  Linda Piazza   4/13/200,  2:18:55 PM
I make about $0.17 for each new book sold for books that it takes me about two years to write, and less for the ones bought in bulk, such as for school book fairs. I have nothing against people buying or selling used books, but I think I agree with the Author's Guild that suggests that readers ought to at least need to go to a different part of the site to buy them rather than have those used book sales compete directly with new ones. While a few authors make big bucks, most can't support themselves on their earnings, even if they're regularly published.

 
 
  James Brown   4/13/200,  2:18:24 PM
A little follow up on the FBR post I made earlier. Evidently the strength today is being boosted by a new "buy" rating that came out intraday.

 
 
  Jim Brown   4/13/200,  2:16:33 PM
Last post on AMZN. My wife picks up collectible books at garage sales for 10-50 cents and I sell them on Amazon for her to support her garage sale habit. Last week she bought $5 of assorted books. She made $25 on the first three that sold and I have one really good book still to sell plus 20 junkers. The good one I have left is an autographed edition of "Debbie, My Life", an illustrated biography of Debbie Reynolds. It was autographed in 1992 by Debbie. Mint condition, like new, cost 50 cents. Going on Ebay tonight for $50.

 
 
  Jeff Bailey   4/13/200,  2:16:20 PM
02:00 Internals at this Link

Highest number of new 52-week lows at the NYSE since 104 on August 4, 2003.

 
 
  Jim Brown   4/13/200,  2:11:57 PM
I would agree and disagree with the used book premise. The authors did get paid on 99% of the used books when they were sold when new. I realize the advance copies are not but they are a very small minority. Secondly, authors get much larger global exposure and probably sell many more books because of Amazon. I have lived in a small town and the bookstores were worthless. I now live within 3-5 miles of several majors and I never go there. I get my weekly Amazon shipment (free shipping) and don't have to deal with the shopping trip. I think authors in general are benefiting from Amazon's volume but that is just my opinion. As a published author your opinion counts for more than mine.

 
 
  Linda Piazza   4/13/200,  2:08:24 PM
I keep listing possible bounce points for the OEX, offering cautions for those in bearish trades, but so far, they haven't been needed. Another one approaches, however, with 552.25-552.80 having served as resistance throughout much of March. Presumably it might be support now, with "might" being the important word now. I do still caution bearish traders to follow the OEX lower with their stops. I do worry about the possibility that shorts may cover as some of these possible support levels are hit ahead of this afternoon's earnings reports.

 
 
  Linda Piazza   4/13/200,  2:03:36 PM
The Author's Guild has been battling AMZN over that ability to sell used books, Jim, as they're posted right alongside the new book sales. (See Jim's 13:54 post.) Most authors want their books to be sold in whatever form in the hopes the sales of used books will promote interest in the authors' next books, but the way AMZN does it bothers many authors and writers groups. Many times used copies are sold (review copies) before new copies even become available and the used copies are always promoted strongly and alongside the new book sales. Authors collect nothing from those competing sales of their used books and AMZN does nothing to reimburse them, either. When authors collect laughably little on their books anyway (often less than a quarter a book on young-adult novels, for example, slightly more for higher priced paperback adult novels) Jeff (Amazon's Jeff) isn't a favorite among many authors groups for this reason. Not that their sentiment affects his company's sales one bit. AMZN and the other bookstores have authors and sometimes publishers in a love/hate relationship with authors almost always the losers.

 
 
  Jane Fox   4/13/200,  2:02:32 PM
Funny you should mention books Jim. I am an avid reader also and just cleaned out my "library" over the weekend so I have a huge amount of old books in very good condition waiting to be sold. I just may try selling them on Amazon instead of at a garage sale. Tks for hint.

 
 
  Jonathan Levinson   4/13/200,  2:01:26 PM
2:00pm U.S. POSTS $72.7 BILLION BUDGET DEFICIT IN MARCH

 
 
  Jeff Bailey   4/13/200,  2:01:14 PM
Market Volatility Index (VIX.X) 17.64 +15.44% ... sharp move up in volatility.

 
 
  Jim Brown   4/13/200,  1:54:38 PM
AMZN - If anybody doubts the power of Amazon they have never tried to sell anything on the book giant. I am an avid reader and read a book about every two days. When done I post them for sale as used on Amazon. I listed three books this morning and all three sold within 15 min. Simply amazing.

 
 
  Jeff Bailey   4/13/200,  1:51:50 PM
10-year YIELD ($TNX.X) up 10 basis points at 4.33% and above WEEKLY R2 (4.295%) as bond YIELD and banks move in opposite direction.

 
 
  Linda Piazza   4/13/200,  1:50:50 PM
Here's a daily chart of the VIX: Link

 
 
  Jeff Bailey   4/13/200,  1:49:34 PM
S&P Banks Index (BIX.X) 338.09 -1.64% ... session lows and nearing MONTHLY S1 of 337.03 after solid break of WEEKLY S2.

SPX 1,132.53 -1.1% trades WEEKLY S1 and equally defensive.

 
 
  James Brown   4/13/200,  1:41:27 PM
Heads up for the bears. Mining company Freeport Mcmoran (FCX) is down 4.86% to $35.81 and breaking support at its 200-dma on stronger than average volume. The stock does have strong support at $35.00 but it could be tested soon.

 
 
  James Brown   4/13/200,  1:38:37 PM
Observation...the sell-off in Friedman Billings (FBR) has paused at psychological and technical support at $20.00 and its simple 200-dma. It's always dangerous to try and pick a bottom but the bounce looks pretty strong...

 
 
  Linda Piazza   4/13/200,  1:37:38 PM
The OEX is now in double-bottom territory, with the current low matching the 15:00 candle low on 4/08. Careful, bears, as this is yet-another possible bounce point. Any such bounce might find resistance now at 555.40-556.60.

 
 
  Linda Piazza   4/13/200,  1:35:10 PM
The OEX is dropping below the 60- and 120-minute 100/130-pma's. It could still bounce, leaving only a candle shadow below these averages, but it had better do so in a hurry if it's going to do that. Those currently in bullish plays should be setting stops that follow the OEX lower, and soon should be able to base a stop on a move back above those averages.

 
 
  James Brown   4/13/200,  1:24:38 PM
The breakdown in copper and metals in general has sent Phelps Dodge (PD) to a new relative low and a technical breakdown below its simple 100-dma. The stock did bounce from the $75 level in the last hour but the trend is certainly bearish.

 
 
  Linda Piazza   4/13/200,  1:23:55 PM
A 30-minute close beneath 554.02 this 30-minute period will set up a downside breakout signal on the (20,2) Donchian channels. The 21(3)3 stochastics are not yet fully oversold, however, with such an oversold setting indicating a market that was already trending as the signal was given. Sometimes breakout signals given when the stochastics are not yet fully oversold or overbought produce iffy trades that are soon stopped out, but one recent iffy trade was good for more than 13 OEX points using one exit method. Remember that I'm tracking these for bookkeeping purposes only, not to suggest trades based only on Donchian channel breakouts. Use them as adjuncts to your other trading tools rather than as your primary tool, as Donchian channel breakout signals result in many stopped trades as well as those spectacular ones. Remember, too, that any valid Donchian channel breakout, at least as I've tested them, requires a close beneath the channel and not just a move below it during the 30-minute period. It's uncanny how many times prices appear sure to close below the channels only to bounce up sometime before the period ends.

 
 
  Linda Piazza   4/13/200,  1:17:05 PM
The OEX now sits on the 60- and 120-minute 100/130-pma's. This should be a powerful bounce point for the OEX, but if it's not . . . . Even if it bounces, I would now wonder about a lower high. The 60-minute versions are at 554.60 and 554.28, and the 120-minute at 554.28 and 554.53. The OEX is already below the 30-minute versions. I've found the 60- and 120-minute versions to have more relevance on the OEX, however.

 
 
  Jeff Bailey   4/13/200,  1:08:13 PM
01:00 Internals at this Link

 
 
  Jane Fox   4/13/200,  1:07:47 PM
Just got through to Qcharts support and was told the industry standard is the INDEX:TRIN symbol so I will stick with this one for now and because this is the one I have used for years. I also asked what the difference was between the prefixes INDEX: and QC: and was told they would have to get back to me. When I get the answer I will report back to you all.

 
 
  Linda Piazza   4/13/200,  1:00:16 PM
I've been staring at the OEX daily chart. I can't say yet that the OEX has fallen out of the bottom of the possible bull flag on that chart, so at what point could we say that? The 552.60 level was historical resistance recently, and now might be support, so a break below that level would be significant, but the 50% retracement of the decline from the March 5 high to the March 24 low lies at about 551.90-552. It would be a drop below that level that would negate the probability that this is a bull flag forming. Careful, though, because a 38.2% retracement of the climb off that March 24 low lies at about 551.21, and that level could produce a bounce attempt.

 
 
  Jeff Bailey   4/13/200,  12:40:47 PM
Swing trade close out covered call alert for the NEM April $45 calls (NEMDI) at the offer of $0.15.

 
 
  Jeff Bailey   4/13/200,  12:39:27 PM
Bullish Swing trade stop alert ... Newmont Mining (NEM) $43.30 -4.4%

 
 
  Linda Piazza   4/13/200,  12:32:08 PM
If that was a bullish falling wedge, it didn't fulfill its bullish promise, with the OEX breaking below it. The OEX is now hitting lower-channel Keltner support. Those in bearish positions should now begin guarding profits, although a Keltner channel breakout can be valid.

 
 
  Ray Cummins   4/13/200,  12:18:06 PM
Spreads/Combos/Premium Selling -- Market Movers: Pharmaceutical Resources (NYSE:PRX)

One of our new bearish candidates is living "down" to expectations today. Shares of PRX are trading $5.06 lower at $48.90 after guiding below first quarter consensus estimates and announcing it will acquire drug maker Kali Labs for $135 million. The generic pharmaceutical firm said the shortcoming was due to a delay in the introduction of a number of generic drugs and a shift in product mix. Investors apparently didn't like the news as they pummeled the stock for a 10% loss. However, that's great news for our "bear-call" credit spread (MAY-65C/60C), which is now comfortably profitable.

 
 
  Linda Piazza   4/13/200,  12:04:58 PM
How is the RLX, the S&P Retail Index, reacting to the upside surprise in March's retail sales numbers? Why, by heading down, of course, with the RLX at 395.88 as I type. The downturn is tugging the 21(3)3 stochastics down out of territory indicating overbought conditions and RSI is already in full bearish roll on the daily chart. That RSI signaled bearish divergence as higher price highs were hit (as compared to March's), but with RSI hitting a lower high. There was also bearish price/MACD divergence. The pattern on the daily chart looks a little like a bearish "b" distribution pattern, but that's a pattern forming just above a whole host of moving averages cycling up toward it, and it's forming just above the 395.60 historical support, too, so it's a little difficult to assess the possibility that the RLX will retreat far. That's especially true since this isn't an index I watch often. Below that support, the weekly chart depicts 386-387.60 as next strongest support, but I would think 390 might be important, too. Bearish divergence shows up on that weekly chart, and has been building since about August last year. It looks as if the retailers need to cool off a bit by either consolidating sideways or retracing some of the strong gains made since January, 2003, but how many times have we heard that lately over the last year about various sectors or stocks, without any such cooling off occurring?

 
 
  Jeff Bailey   4/13/200,  11:58:57 AM
Mace Security Intl. (MACE) $10.33 +29.37% ... Questions regarding today's news of 1.67 million shares being released for trade

Yes, will expect additional supply to have a potentially near-term negative impact on stock. As noted earlier this morning, public float was just 6.5 million shares, where float should rise to at least 8.17 at a minimum between 12:00 PM EST and April 29.

Still, volume has been heavy, and I don't expect stock to "get crushed" at 12:00 PM EST, as market now knows about additional supply coming.

Not sure how many insiders will be selling at this point.

Current volume so far today is 36 million, so additional 1.67 million not overly large based on recent couple of days volume, but traders should note that before stock was "discovered" yesterday, volume rates were very low.

 
 
  Ray Cummins   4/13/200,  11:54:58 AM
Spreads/Combos/Premium Selling -- E-mail Replies: Strategy Selection

Ray...Do you advocate doing Iron Condor credit spreads on May expiration this far out. I know there is an extra week till May expiration. Thanks. RS

Hello RS, I'm sure most traders would agree, that time-frame is viable for Condors...5 weeks is definitely considered "front-month" even among professional market players. However, the more important issue is "expected volatility" and the coming weeks are certain to provide some dramatic price swings. The question is, will this activity be contained in the recent trading range or will it push the major indices to new (2004) highs or lows. Your forecast in that regard should be a significant element of the criteria for any potential Condor position. Hope that helps!

 
 
  Linda Piazza   4/13/200,  11:46:00 AM
The OEX did achieve a new low, but now there's a new wrinkle. The pattern on the five-minute chart looks suspiciously like a falling wedge, and those usually break to the upside. The apex of this one hits at about 555.50, just above the 555.43 support offered by the lower-channel Keltner support, so it should break to the upside before diving below that support if it is indeed a bullish falling wedge.

 
 
  Jeff Bailey   4/13/200,  11:21:45 AM
Mace Security (MACE) $10.52 +31% ... at approx. 10:30 AM EST, company announced it agreed with Price Legacy Corp., the owner of 1.675 million shares of MACE common stock, to remove a selling restriction on those shares in exchange for Price Legacy paying to MACE one half the proceeds from the sale of that stock. The trading window for the sale of this stock will commence at 12:00 PM EST today until April 29.

MACE's board of directors has also opened the window for limited trading of no more than 100,000 shares for each director and Executive Officer of the company.

Full story at this Link

 
 
  Linda Piazza   4/13/200,  11:20:27 AM
The OEX appears to be breaking down out of that probable bear flag from this morning, with that breakdown to be confirmed by a move to a new low, with the current low at 556.65. Whatever the TRIN might be today, the action has been bearish so far. Maybe everyone was bailing, thinking the TRIN was more bearish than it was?

 
 
  Jeff Bailey   4/13/200,  11:18:23 AM
11:00 Internals at this Link

 
 
  Linda Piazza   4/13/200,  11:05:11 AM
For those watching the MM pages only, Jim is reporting on the Futures side that the Q-charts numbers for TRIN may be wrong. I'm showing a number that Jim reports as probably being wrong, too.

 
 
  Linda Piazza   4/13/200,  10:54:35 AM
Yesterday, the QQQ's printed an inside day. Today, the QQQ's open constituted an upside break above yesterday's high, so should rightly have triggered a bullish play. Later, though, the QQQ's fell below yesterday's low, triggering a bearish play and stopping out the bullish one. I've mentioned in the past that I'm not a big fan of the inside-day trading theory, and this is one reason why. There just seem to be too many fake-out moves with inside days.

For those of you not familiar with the technique, here's a link to an article from our archives: Link As Jeff noted in this article, benefits of employing this technique are that it has no bias and offers a disciplined and cut-and-dried approach to setting stops. You know when it's working and when it's not. He also gives guidelines for entering inside-day trades and foregoing them. Based on that information, perhaps one would forego the bearish trade just triggered because of possible trendline and gap support just below the current QQQ position.

 
 
  Jeff Bailey   4/13/200,  10:51:26 AM
Darden Restaurants (DRI) $23.50 -2.32% ... stop profit for those EOY OptionInvestor.com renewal subscribers. Nice trade, but time to take some profits here.

 
 
  Jeff Bailey   4/13/200,  10:48:14 AM
Newmont Mining (NEM) with covered call update ... NEM $43.57 -3.73%.

Those that sold the NEM April $45 call (NEMDI) for $0.70 per share lowered their stop in the underlying shares from $44.00 to $43.30.

Should NEM trade the stop of $43.30, plan is to buy back those calls (currently offered $0.15) then close out the underlying bullish stock position at market.

Ideally, NEM bull would like to see NEM rebound into Friday's expiration to $44.99, but dollar strength, should it continue, not good at this point and we may be finding out why gold stocks didn't follow gold futures back to highs.

 
 
  James Brown   4/13/200,  10:45:10 AM
Sector Update...

Winners?
OIX oil index: +0.01%

(Biggest) Losers:
XAU gold & silver: -3.84%
DDX disk drives: -1.67%
INX Internets: -1.13%
NWX Networking: -1.18%
BTK biotech: -1.09%

UTY utilities: -1.54%
DJUSHB homebuilders: -1.28%
and Copper futures: -1.28%

 
 
  Jeff Bailey   4/13/200,  10:39:22 AM
Swing trade bullish stop alert .... MACE $10.75 for remaining position.

 
 
  Jeff Bailey   4/13/200,  10:36:53 AM
MACE $11.28 +41% ... softening up. Session low has been $11.01.

 
 
  Linda Piazza   4/13/200,  10:35:39 AM
The OEX is trying to hold at the 557 level, perhaps trying to rise into a possible bear flag, but it's uncertain whether it can do so.

 
 
  James Brown   4/13/200,  10:33:35 AM
The 2.2% decline and breakdown below support at $80 and its 100-dma has triggered our OI put play in Lehman Brothers (LEH).

 
 
  James Brown   4/13/200,  10:27:38 AM
Yuck! Novellus (NVLS) is down 2.5% in spite of its positive earnings report last night. The current candlestick is painting a big bearish engulfing pattern, which normally suggests a possible reversal.

 
 
  Jim Brown   4/13/200,  10:27:17 AM
There is some news out this morning that Intel is having trouble making enough of their high end P4 chips. Dell has taken the option out of its product line and when they are available the delivery times are stretching to six weeks.

This suggests either the demand for the 3.4ghz chips is very strong or Intel is having trouble making them. We have no clues which option is the culprit. Either way a shortage of chips from Intel normally is bad for the company. Many buyers will wait for the new chip instead of buying a slower one. We only have a few hours to wait to see if Intel profits have been hampered by the shortage. Link

 
 
  Jeff Bailey   4/13/200,  10:25:24 AM
Taser Intl. (TASR) $98.17 +0.68% ... here's 60-minute interval chart of TASR Link

(per traders request for update)

 
 
  James Brown   4/13/200,  10:23:03 AM
U S Cellular (USM) is down 3.45% to $37.17 after Legg Mason (LM) sliced the stock to a "sell" rating. This follows the Prudential downgrade three weeks ago to an "under weight". USM's MACD has rolled back over into a new sell signal. This follows a new sell signal on its Point & Figure chart, which points to a longer-term $30 price target.

 
 
  James Brown   4/13/200,  10:18:19 AM
Leapfrog Enterprises (LF) is up 6.6% to $22.25 after Merrill Lynch upgraded the stock from "neutral" to a "buy" and raised their price target to $28. Shares of LF had been struggling with resistance at $21 the last couple of days. Currently the stock is trading just under its simple 40-dma. LF is expected to report earnings on April 21st.

 
 
  Jeff Bailey   4/13/200,  10:13:07 AM
MACE $12.23 +52% ... has been hovering around this $12.19 level for 20-minutes. Session high/low still $14.80-$11.66.

A bit surprised it hasn't tried to backfill the morning gap higher from $8.00 yet.

 
 
  Linda Piazza   4/13/200,  10:12:55 AM
The TRAN teeters just over its 100-dma at 2927.26, having found support there Thursday, Monday, and--so far--today. Its hold on that average appears tentative, however, as oscillators flatten, awaiting either a bounce or a plunge beneath that average. As I type, the TRAN is at 2927.73.

 
 
  James Brown   4/13/200,  10:12:38 AM
Too cold to ride bikes? Huffy (HUF) is down 13% and falling fast (now at $3.37) after warning that earnings will be worse than expected. HUF's CEO blamed their Canadian operations for the larger than expected loss. Analysts' estimates are at 10 cents a share for the first quarter.

 
 
  Jeff Bailey   4/13/200,  10:08:58 AM
IPIX Corp. (IPIX) $21.85 -1.39% Link ...

 
 
  Jonathan Levinson   4/13/200,  10:07:29 AM
10:01am U.S. FEB INVENTORY/SALES RATIO STILL AT RECORD LOW 1.33

 
 
  Jonathan Levinson   4/13/200,  10:05:21 AM
A 6.7B 3-day repo replaces 7.2B expiring, net drain 1B.

 
 
  Jeff Bailey   4/13/200,  10:05:10 AM
U.S. Market Watch at this Link

Sector action now broadly lower.

 
 
  Linda Piazza   4/13/200,  10:04:55 AM
That TRIN was telling a story traders needed to heed. The OEX is now below mid-channel Keltner support, but is at nearest next support at 558. It should attempt a bounce somewhere through here, but if it can't get back above mid-channel S/R at 558.74, it might be headed down toward lower-channel support, currently at 555.95 as it rattles around trying to establish support and resistance zones it neglected to establish during the late November to January climb.

 
 
  Jonathan Levinson   4/13/200,  10:01:38 AM
10:00am U.S. FEB BUSINESS SALES UP 0.5% TO RECORD $898.8 BLN

 
 
  Jim Brown   4/13/200,  10:00:06 AM
Business Inventories = +0.7% (last +0.5%, last +0.1%)

 
 
  Jeff Bailey   4/13/200,  9:58:28 AM
Mace Security (MACE) $12.39 +54% .... still most active at 16 million shares. That's almost 3-time the public float of 6.5 million shares.

 
 
  Jeff Bailey   4/13/200,  9:56:03 AM
Semiconductor Index (SOX.X) 515.25 (unchanged)

QQQ $37.17 (unchanged)

 
 
  Linda Piazza   4/13/200,  9:55:00 AM
The OEX fell back below that trendline off the 4/05 high, a bearish action, but it's maintained levels above the mid-channel Keltner support, at least so far. The five-minute oscillators still cycle down.

 
 
  Linda Piazza   4/13/200,  9:52:23 AM
Based on the TRIN's action and the current test of OEX resistance, I'd be extremely careful if in bullish OEX positions. The OEX broke above that descending trendline off the 4/05 high, but it hasn't yet given the confirmation I needed to see with a break above that 4/05 high. As I warned this morning, this is opex week, so anything can happen, including a strong break above that confirming level and an accompanying dive in the TRIN. Just be careful, as that TRIN warns that this might be a better place for shorting if a rollover should begin--confirm price action rather than just acting on the TRIN level alone--than enter a bullish position.

 
 
  Jeff Bailey   4/13/200,  9:50:38 AM
Newmont Mining (NEM) alert $43.82 -3.18% .... traders that DID NOT write the April $45 covered call (on Thursday) should be Stopped out at $44.00.

 
 
  Jane Fox   4/13/200,  9:48:57 AM
Egads Linda the TRIN is 1.84, now that is bearish. This along with the NYA and RUT falling is not looking good for bulls.

 
 
  Jeff Bailey   4/13/200,  9:47:47 AM
Sectors mixed... with weakness in the Gold Bugs ($HUI.X) 220.34 -3.16%, Homebuilders (DJUSHB) 604.12 -2.95%, Utility (UTY.X) 308.50 -1.66%.

Strength is HMO Index (HMO.X) 998.91 +0.44%, Retail HOLDRs (RTH) $92.98 +0.35%

 
 
  Linda Piazza   4/13/200,  9:47:46 AM
What's TRIN doing, Jane or Jonathan? It's shooting up there, isn't it? Careful, bulls!

 
 
  Jeff Bailey   4/13/200,  9:46:29 AM
QQQ $37.12 -0.13% .... opening 5-minutes was $37.36-$37.27.

 
 
  Linda Piazza   4/13/200,  9:45:12 AM
The BIX continues lower this morning, currently at 15-minute Keltner support, but just above a supporting trendline off the 4/05 lows. That trendline crosses at about 342.40. A plunge through that support could hamper an OEX rise, while a bounce from it could help.

 
 
  Jeff Bailey   4/13/200,  9:44:11 AM
Early percentage gainers/loser at this Link

 
 
  Linda Piazza   4/13/200,  9:42:37 AM
So far, the OEX's pullback has constituted a retest of the former descending trendline off the 4/05 high, and so far the OEX is holding above that trendline. So far, so good, then, for those who might have entered bullish plays. Continue to be careful, though, as the first real pullback of the day typically begins about now. This is especially true since the OEX is registering as overbought on a Keltner channel basis.

 
 
  Linda Piazza   4/13/200,  9:40:23 AM
Unfortunately, I don't see news of any IPO's to be released today, so there's no opportunity to follow those trades using Jeff's 5MRT system, and continue testing that system as one way to gauge the progress of trades in these highly risky IPO's.

 
 
  Linda Piazza   4/13/200,  9:38:13 AM
During the first five minutes of trading, the OEX spanned a range from 560.13 to 561.05. During that first five minutes, the OEX broke over the top of the descending trendline off the 4/05 high, suggesting an upside break out of the bull flag formation, but as I mentioned this morning, I won't consider that upside break confirmed until and unless the OEX breaks above the 4/05 high or above 463, since that has been such strong S/R over past months. Those who might have entered a bullish trade based on that presumed breakout should be careful with stops today, as this is an opex week packed with earnings announcements and news from Iraq. Especially if in front-month options, you don't have a lot of time for positions to work, either, as time decay is going to work against you unless positions move your direction quickly.

 
 
  Jeff Bailey   4/13/200,  9:37:50 AM
MACE $13.76 +71.25% ... here's intra-day chart, but doesn't show session high of $14.80. Link

First 5-minute bar was from $11.66-$13.10.

 
 
  Linda Piazza   4/13/200,  9:32:20 AM
In earliest trading, the OEX moves up to challenge upper channel Keltner resistance, currently at 561, as well as historical resistance and resistance from the descending trendline off the 4/05 high.

 
 
  Jeff Bailey   4/13/200,  9:32:11 AM
Swing trade raise bullish stop alert ... for Mace Security (MACE) in remaining 1/2 bullish position to $10.75.

 
 
  Jane Fox   4/13/200,  9:31:13 AM
So Jeff do we have another TASR on our hands?

 
 
  Jeff Bailey   4/13/200,  9:30:37 AM
Mace Security (MACE) $12.61 +58% ....

 
 
  Jeff Bailey   4/13/200,  9:27:55 AM
Infosys Technologies (INFY) $84.00 Link ... higher at $88.20 after company reported quarterly EPS of $0.58, which was 2 cents better than consensus estimates.

 
 
  Jane Fox   4/13/200,  9:26:02 AM
Corporate taxes are becoming a hot issue in the presidential campaign since a recent GAO showed that less than 40% of U.S. companies paid any federal taxes in each of the four years from 1996 to 2000 and that IRS audits have continued to drop under President Bush. If this controversy translates into action in Washington, either under a new administration or the current one, corporate profits could suffer since new data suggests that shrinking effective corporate tax rates have helped boost corporate profits to record levels.

 
 
  Jeff Bailey   4/13/200,  9:24:06 AM
Mace Security (MACE) is this morning's most actively traded in the pre-market at just over 3 million shares. Currently trading $11.07, where pre-market range has been from $9.00 to $11.95.

 
 
  Jeff Bailey   4/13/200,  9:17:51 AM
09:00 Update at this Link

 
 
  Linda Piazza   4/13/200,  9:06:01 AM
European markets have climbed higher since my first report on those markets. The FTSE 100 now has climbed 34.40 points or 0.77%, to 4524.10. The CAC 40 has tacked on 52.14 points or 1.39%, to trade at 3792.25. The DAX has climbed 78.60 points or 1.96%, to trade at 4092.13.

 
 
  Linda Piazza   4/13/200,  8:56:54 AM
Futures indicate a higher open this morning. As yesterday ended, the OEX had completed a bullish candle that conformed to a possible bull flag formation on the daily chart, but there had been no break out of that formation in either direction. Keltner channels and one (the highest) version of a descending trendline formed off the April 5 high both show the 560.25-561 level to be significant resistance. A breakout above those levels suggests an upside break of the bull flag, to be confirmed by a move above the 4/05 high of 562.86 or above 563, depending on how cautious one wants to be. Yesterday's trading established 558.40 as strong support, with a breakdown below that level suggesting a move down toward 556.50 support, if not lower. Futures suggest that there will be a testing of that upper resistance before a testing of support, but that's a suggestion only and sometimes the cash markets open differently than we expect. If the OEX can break above that 4/05 high, then a test of the descending trendline off the late January high might be suggested, with one version of that trendline currently at about 569. Be careful, however, as the 5(3)3 daily stochastics have been in full bearish roll and RSI turns down, too. They can be turned back up again, and probably will on a strong push upward, and the more reliable 21(3)3's have not yet been tugged down out of territory indicating overbought conditions, but these could argue against a full-out bullish scenario. Remember, too, that this is an opex week packed with earnings announcements, and anything is possible.

 
 
  Jonathan Levinson   4/13/200,  8:31:15 AM
8:30am U.S. MARCH RETAIL SALES BEAT EXPECTATIONS OF 0.7% GAIN

8:30am U.S. MARCH RETAIL SALES UP 1.8%, EX-AUTOS UP 1.7%

Once again, it looks like the data was leaked.

 
 
  Jonathan Levinson   4/13/200,  8:04:02 AM
We await February business inventories, est. .5%, March retail sales, est. .7% and retail sales ex-auto, est. .6%, all scheduled for release at 8:30.

 
 
  Linda Piazza   4/13/200,  7:07:07 AM
Good morning. Tuesday, an index that measures consumer spending in Japan achieved a positive number for the first time since the fall of 1996 and the Bank of Japan's March wholesale prices showed the first year-over-year rise since July 2000. With bonds slipping and equities climbing, the Nikkei gapped almost 100 points higher at Tuesday's open. Banks, retailers, and semi-related stocks gained in early trading. Goldman Sachs raised its rating on one retailer, Aeon Co., from an in-line rating to an outperform rating. Semi stocks gained early on hopes that Intel will report strong earnings. Reaching as high as 12,170.96 intraday, the Nikkei closed up 85.12 points or 0.71%, at 12,127.82. Most of the day, the Nikkei traded in a range from 12,100 to 12,140.

By the end of trading, some banks had added more than 6%. The auto sector traded mostly lower after the dollar eased against the yen. Some techs declined, perhaps at least partly related to the currency issue as many are exporters.

Techs were mixed across Asia, and Asian bourses were mixed, too. With Taiwan Semiconductor slipping 0.8%, the Taiwan Weighted still managed to gain 0.24%. South Korea's Kospi fell 0.13% and Singapore's Straits Times also fell, by 0.15%. Hong Kong's Hang Seng gained 0.95%, but China's Shanghai Composite fell 0.09%.

As earnings pour in and as the euro eases against the dollar, most European bourses trade higher this morning. Although the performance of chipmakers and chip-related stocks in Asia might have been spotty by the end of trading, NVLS's earnings helped send European competitor ASML higher in trading early Tuesday. Despite slightly higher-than-expected net profit and rising sales, Philips Electronics tumbled in early trading after its CFO made comments during the conference call that disputed the CEO's recent forecast of 10% growth for comparable sales. Still, one article characterizes this morning's gains in European markets as broad based.

As of this writing, the FTSE 100 has climbed 17.30 points or 0.39%, to 4507.00. The CAC 40 has gained 36.92 points or 0.99%, to trade at 3777.03. The DAX has gained 62.50 points or 1.56%, to trade at 4076.03.

 
 
  OI Technical Staff   4/12/200,  6:46:27 PM
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