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  Jeff Bailey   4/21/200,  6:32:36 PM
Closing Internals at this Link

  Jim Brown   4/21/200,  5:28:28 PM
KLAC Raised earnings guidance on their call but lowered revenue guidance. Then they said they could come in at the low end of expectations if they did not close several critical orders during the quarter. The stock took an immediate hit of nearly -4 in after hours trading and knocked the futures well off their EBAY induced highs.

STM also missed estimates by a mile with complaints that profit margins were slipping on increased competition.

  Jim Brown   4/21/200,  4:00:39 PM
Earnings After the Close:

LF est = -0.20, actual = -0.20
ADS est = +0.28, actual = +0.39
BSG est = +0.22, actual =
CAI est = +0.50, actual = +0.53
CDN est = +0.10, actual = +0.10
CVD est = +0.33, actual = +0.34
DOX est = +0.27, actual = +0.29
EYE est = +0.20, actual = +0.23
KMI est = +1.00, actual = +1.02
KMP est = +0.52, actual = +0.52
LRW est = -0.01, actual = +0.02
PYX est = +0.17, actual =
RYL est = +1.63, actual = +2.06
STM est = +0.12, actual = +0.08
SDS est = +0.30, actual = +0.29
TMK est = +1.03, actual = +1.03
WLP est = +1.58, actual = +1.79
YUM est = +0.45, actual = +0.47
ACMR est = +0.05, actual = +0.06
AFFX est = -0.08, actual = -0.03
AFCO est = +0.29, actual = +0.28
ALTR est = +0.13, actual = +0.13 raising guidance
ARRS est = +0.03, actual =
ASCL est = +0.08, actual = +0.08
ASIA est = +0.02, actual = +0.04
ATML est = +0.00, actual = +0.02
AUDC est = -0.02, actual = +0.00
BRKT est = +0.00, actual = +0.01
BVSN est = +0.03, actual = +0.03
CALD est = -0.08, actual = -0.18
CERN est = +0.32, actual = +0.38
CHIR est = +0.27, actual = +0.22
CTXS est = +0.18, actual = +0.19
EBAY est = +0.26, actual = +0.31
EFII est = +0.20, actual = +0.22
EPIC est = +0.10, actual = +0.12
ERES est = +0.18, actual = +0.20 3:2 split
FFIV est = +0.14, actual = +0.16
HYSL est = +0.32, actual = +0.37
ISIL est = +0.19, actual = +0.19
IWOV est = -0.01, actual = -0.01
JNPR est = +0.08, actual = +0.09
KLAC est = +0.29, actual = +0.33
LMNX est = +0.00, actual = +0.00
NABI est = -0.04, actual = -0.08
NCEN est = +1.86, actual =
PLXS est = +0.08, actual = +0.08
QCOM est = +0.48, actual = +0.53
RARE est = +0.39, actual = +0.42
SBUX est = +0.17, actual = +0.19
SERO est = +0.11, actual = +0.11
SSTI est = +0.12, actual = +0.14
SLNK est = +0.10, actual = +0.11
SRDX est = +0.25, actual = +0.25
SWFT est = +0.08, actual =
TTEK est = +0.23, actual =
VRTS est = +0.21, actual = +0.23

  Linda Piazza   4/21/200,  3:55:32 PM
Will the Russell make it all the way up to that 582.85 target? It's not looking likely, at least by the close. Remember, though, that I believe these upside targets are targets for possible countertrend or oversold bounces, and not necessarily a sign of strength. In the Russell's case, this bounce comes from support at the 100-dma, so it's possible that the Russell 2000 is preparing to rise within the broad trading range that it's established within the last few months. Oscillators look somewhat troubling, however, and not particularly supportive of a bullish conclusion about likely action.

The OEX came nowhere near to meeting the upside target projected from an intraday formation today, however. It did find support near the 61.8% retracement of the March plunge, perhaps in preparation for rising to test resistance tomorrow.

  Jeff Bailey   4/21/200,  3:54:58 PM
Motorola (MOT) $19.29 +18.92 ... and RED #1.

  Jeff Bailey   4/21/200,  3:50:34 PM
Bearish day trade stop alert ... MOT $19.26.

  Linda Piazza   4/21/200,  3:43:21 PM
As a reminder, OEX 550.77 or so is the 50% retracement of the flagpole drop that began yesterday afternoon. On the 30-minute chart, the OEX climb is now beginning to look like a nicely formed rising regression channel. It did broaden out from the earlier pattern that had looked more like a wedge. If this current pattern is a bear flag, then it should break to the downside before the OEX retraces higher than 550.77. The mid-channel Keltner resistance is now at 550.05-550.39 and upper channel resistance has now dropped to 553.79. I don't think I'd be surprised to see the OEX break above that mid-channel resistance and make a try for 552, though, but I wouldn't be surprised to see a breakdown at any time, either. In either case, I expect a rollover at one resistance level or another. I've been thinking for a while that the OEX might just churn around as it establishes support and resistance on that daily chart, before it then decides on the final direction.

  Linda Piazza   4/21/200,  3:38:08 PM
The Russell resisted falling below the neckline of its H&S on its 2-minute chart. It hasn't yet met the 582.80 upside target projected from this morning's breakout of the symmetrical triangle at the bottom of its range, but it may be about to try for that target again.

  Linda Piazza   4/21/200,  3:35:41 PM
In reference to Jeff's 15:28 post, I've seen some emails that sent my head spinning, too. What readers may not realize is that some of us, some who weathered 2000, may actually lie awake at night worrying on behalf of our readers. We may not have recommended some risky play or another and may have suggested multiple ways of protecting profits when we learned of readers who jumped in--I know I have--but that doesn't mean that we don't care or that we write off those readers. Anyone who is in the market through the last years has almost surely suffered times when profits and sometimes trading accounts were wiped away, sometimes in a single day. Were any of you short, for example, when the Fed made the surprise rate change, lowering the rate, for example? Were any of you long those high-flyers during the March 2000 opex cycle and held on and held on, thinking those stocks were going to turn around? Did you average down? What about Enron when it started inexplicably sinking? Did any of you buy on one of those last earnings runs, only to have the thing sink instead of rise into earnings the way it usually did? Did you believe in its hype so strongly that you held on? We writers have either suffered through these events or had trading partners or friends who did, and we don't want anyone else to go through times like that. There will always be another trade, as long as you preserve the trading capital with which to participate in that trade. I personally would rather you missed out on a great trade than advise you to get into a risky one.

  Jeff Bailey   4/21/200,  3:28:15 PM
(Big grin) for Jim's 15:23:00 .... Jim and I have seen some e-mails that have had our heads spinning.

Most traders that have been around KNOW that they usually hear about the winners, but very few traders will ever discuss their losers. I'm pretty sure that while e-mail has been showing BIG winners, there's probably been some big losses I haven't heard about. Stay disciplined, and don't get bug-eyed.

It is YOUR money to do with as you see fit. BIG option trade size in VERY volatile stocks just gives me the jitters is all.

  Jeff Bailey   4/21/200,  3:24:18 PM
Day trade bearish adjustment alerts ... for Motorola (MOT) ... lower stop to $19.26 and raise bearish target to $19.02.

  Jim Brown   4/21/200,  3:23:00 PM
Jeff, are you saying my 500 contracts of the May $150 calls may be over leveraging? (grin)

  Linda Piazza   4/21/200,  3:21:15 PM
This pullback on the OEX does broaden the rising formation a bit, reforming that possible rising wedge into a rising channel. That rising-channel premise depends on the OEX finding support between the current level and 548.22. Otherwise, we're seeing a breakdown out of the bearish rising wedge.

  Jeff Bailey   4/21/200,  3:20:24 PM
Motorola (MOT) $19.12 +17.87% ... "really softening up here" ... just off a session low of $19.10.

  Linda Piazza   4/21/200,  3:14:45 PM
The Russell 2000 is showing another possible H&S on the 2-minute chart, with a neckline at about 580.50, but with further support near 580.20.

  Jeff Bailey   4/21/200,  3:14:09 PM
Taser Option traders.... please don't e-mail me saying you bought 100, 500, 2000 contract. Drives me crazy and stresses me out as this is WAY OVERLEVERAGING in my opinion.

  Jeff Bailey   4/21/200,  3:10:25 PM
03:00 Internals at this Link

  Linda Piazza   4/21/200,  2:56:47 PM
It's time now to start talking about Keltner support for the OEX. Two channel lines converge near 548.80, so first support should be close to the current OEX position. Below that, support lies at 547.28 and 546.46.

  Jeff Bailey   4/21/200,  2:56:03 PM
Taser Intl. (TASR) $84.39 (unch)

Crazy looking PnF chart ... Link but we can perhaps see where today's high of $91.93 might have found some resistance selling.

  Jeff Bailey   4/21/200,  2:50:36 PM
Morgan Stanley Cyclical Index (CYC.X) 685.05 +0.85% ... moves to session high brief extension above day's horizontal resistance of 684.

Component gainers? MOT $19.23 +18.55%, F $14.88 +9.73%, R $39.90 +2.28% ...

Component losers? AA $31.50 -4.68%, PD $68.23 -3.42%, UTX $84.80 -3.07% and X $33.94.

Noting 3 of the four losers are industrial metals. (Aluminum, copper, steel)

  Jeff Bailey   4/21/200,  2:46:28 PM
Taser Intl. (TASR) $86.03 +1.95% ... building a tight little 5-minute triangle...

Laughing to myself... "if this one trades sideways the remainder of the session..."

  Linda Piazza   4/21/200,  2:46:01 PM
The Russell is hitting resistance in the form of a rising trendline across today's price peaks.

  Jeff Bailey   4/21/200,  2:43:56 PM
Day trade lower stop alert ..... for Motorola (MOT) to $19.32.

Still stuck at $19.25, but if going lower to the close, bettern not trade $19.32 is my thinking.

  Linda Piazza   4/21/200,  2:43:14 PM
The OEX is hitting mid-channel resistance on the 5-minute chart, at 550.28. This would be a place for the OEX to broaden out its current pattern, to change it from a rising wedge (bearish) to a rising regression channel (possibly bearish, as in a bear flag).

  Linda Piazza   4/21/200,  2:40:28 PM
Here's a formation, a possible bearish rising wedge, that OEX bulls should keep on their screens: Link It may have bearish implications although these have not been the most reliable of formations the last year.

  Jeff Bailey   4/21/200,  2:38:14 PM
U.S. Dollar Index (dx00y) 91.16 +0.74% ... just getting an alert here, which would have been 30-minute ago. This would be a move above this morning's 09:05 AM EDT high, and something I'd have to consider a fairly strong reversal of thought after an intra-day low of 90.53 was found at approx. 10:25 AM EDT.

  Jeff Bailey   4/21/200,  2:34:38 PM
Sell Program Premium

  Linda Piazza   4/21/200,  2:32:53 PM
The Russell 2000 just broke out above nearest intraday resistance, perhaps putting that 582.80 upside target from this morning's breakout above the symmetrical triangle into the realm of possibilities.

  Jeff Bailey   4/21/200,  2:32:05 PM
Taser (TASR) $86.35 +2.27% ... updated 5-minute interval chart. Link

I would still rather limit my risk with the options than the underlying stock at this point. By no means would I think potential short squeeze can't still take place on a gap higher type of open. All is fair in love and war with this one.

  James Brown   4/21/200,  2:25:13 PM
Last week's decline in the HMO healthcare index stalled at rising technical support at its 40 & 50-dma's. The sector has bounced from these levels in the past and the action over the last couple of days looks like a short-term bottom. If you're looking for bullish plays this might be a group to scan through.

  Jim Brown   4/21/200,  2:23:45 PM
Fox news is reporting a potential bomb in front of a Sun Trust Bank in Atlanta. Officers on the scene with a robot bomb sniffer.

  Linda Piazza   4/21/200,  2:23:00 PM
While intraday support near 578.80 was holding on the Russell 2000 earlier, intraday resistance near 580.40 is so far holding up, too.

  Jeff Bailey   4/21/200,  2:22:43 PM
Buy Program Premium

  Jeff Bailey   4/21/200,  2:22:20 PM
Swing trade bearish alert ... buy the TASR May $70 Puts (QURQN) for $4.30, stop $3.00 on this option, target $7.00.

TASR stock at $86.75.

  Jeff Bailey   4/21/200,  2:14:47 PM
Sell Program Premium

  Jim Brown   4/21/200,  2:13:52 PM
AFFX has been halted

  James Brown   4/21/200,  2:09:58 PM
Online advertising rose to $7.3 billion in 2003, the highest level in three years. Driving ad dollar growth was a 35% jump in keyword search, a 21% jump in banner advertising and a 17% jump in classified ads.

  Jeff Bailey   4/21/200,  2:09:50 PM
Market Watch at this Link

Minutes after Beige Book

  Jim Brown   4/21/200,  2:07:11 PM
Full text of Beige Book: Link

  Linda Piazza   4/21/200,  2:07:02 PM
The OEX appeared to be breaking above the neckline of the possible inverse H&S on the 5-minute chart, although it's now pulling back. I'm not absolutely certain of that neckline location. If it continues pulling back, that could resolve the formation into a rising wedge--a bearish rather than bullish formation.

  Jeff Bailey   4/21/200,  2:05:25 PM
Motorola (MOT) $19.26 ...

  James Brown   4/21/200,  2:04:46 PM
The SOX semiconductor index had been stuck in a tight 2-point range (445-447) the last couple of hours and just "broke out" through the top of the range above 447 but it's not seeing any follow through.

  Jeff Bailey   4/21/200,  2:02:49 PM
QQQ $36.08 +1.08% ... makes a session high.

Most likely some Beige Book anticipation. Can't read it this fast.

  James Brown   4/21/200,  2:02:37 PM
The GHA hardware index also happens to be rebounding off its intraday lows (granted, not a very strong rebound), which also happens to be supported by its simple 200-dma.

  James Brown   4/21/200,  2:01:28 PM
The Dow transports (TRAN) aren't looking too bad here. The sector is up 1.12% right now and today's intraday low is a higher-low in the recent consolidation.

  Jim Brown   4/21/200,  2:00:54 PM
Beige Book - Says business growth good, inflation light.

  James Brown   4/21/200,  1:53:55 PM
Joe Kernen talking about C.R.Bard (BCR), which is up 7.43% to $107.70 after reporting very strong earnings last night and a 2-for-1 split this morning. Volume is huge at 1 million shares versus the average of just 363K a day.

  Jeff Bailey   4/21/200,  1:45:26 PM
Qualcomm (QCOM) $65.76 +2.06% Link ... I did make note sometime ago that QCOM had achieved its Pnf chart's bullish vertical count of $67.

I think I profiled it bullish back in August of 2003 on that triple-top buy signal of $40, only after a fellow subscriber noted the trade. Was a honey as it turns out!

  Jeff Bailey   4/21/200,  1:40:31 PM
Trader notes ... Jeff, Just an FYI remember that QCOM reports tonight and that is why MOT is probably holding up..also Radio Shack reported brisk sales of CDMA handsets..I trade Qcom.. Best regards Charley

Thank you Charley! Makes some sense, will not hold MOT overnight at this point.

  Linda Piazza   4/21/200,  1:38:19 PM
The advdec line has flattened over the last hour.

  Linda Piazza   4/21/200,  1:31:51 PM
Mid-channel Keltner resistance on the OEX 5-minute chart has descended to 550.62 while upper channel resistance has descended to 554.53. Because the OEX has violated the lower boundary for such a long period of time, there's vulnerability for the OEX to bounce up to mid-channel resistance if not to upper channel resistance, but with that resistance descending, that might not be too big of a bounce.

  Jeff Bailey   4/21/200,  1:27:47 PM
Day trade lower stop alert .... for Motorola (MOT) to $19.41.

As session wears on, begin thinking that $18.96 becomes most achievable target and not original target of $18.25.

  Jeff Bailey   4/21/200,  1:24:45 PM
QQQ $35.99 +0.85% ... I fixed the link/comment at 12:26:43.

  Jeff Bailey   4/21/200,  1:20:58 PM
Motorola (MOT) $19.25 ...

  Jeff Bailey   4/21/200,  1:20:10 PM
01:00 Internals at this Link

Greenspan finished his testimony just prior to 12:00 PM EDT. Things have been very tight since.

  Linda Piazza   4/21/200,  1:16:19 PM
The Russell 2000 still holds above the intraday historical support near 578.85, but that hold is still tentative. The Russell 2000 sports the same kind of lopsided possible inverse or reverse H&S as does the OEX, but the Russell's has an ascending neckline, now currently just above 581.

I also wanted to note that the 582.85 upside target predicted by the breakout of this morning's neutral triangle will soon be joined by the descending trendline that began forming off yesterday morning's high. That trendline is now just above 584, but it's moving down quickly. That confirms the resistance that should be offered near that zone, and also confirms the importance of any breakout above it.

  Linda Piazza   4/21/200,  1:04:27 PM
Despite my 12:55 post, here's a potentially bullish formation on the OEX 5-minute chart: Link This says to me that the bulls keep trying, but it doesn't necessarily predict that they'll be successful. I think this is more a case of the typical post-big-drop-day behavior than anything else, but if I were in a bearish position, I'd sure be keeping an eye out for possible signs that a stronger countertrend bounce could begin.

  Linda Piazza   4/21/200,  1:00:18 PM
IPO PROS is still within the neutral zone as depicted by Jeff's 5MRT system. I alternately can and cannot get a chart on GMNT this morning, so I haven't been able to follow its progress.

  Linda Piazza   4/21/200,  12:58:34 PM
The Russell 2000 has been holding tentatively above intraday support near 578.80, but its hold above that level is tentative right now. There's a miniature H&S formation on its 2-minute chart, not particularly well formed, but well formed enough to give a warning to those playing the countertrend bounce. Be careful.

  Linda Piazza   4/21/200,  12:55:53 PM
Despite the best efforts of the bulls, the OEX has resisted moving above the confirmation level of the double-bottom formation from today's five-minute chart. That, in itself, is a bearish development. Bulls need to pull it together quickly or else the OEX is going to see new lows.

  James Brown   4/21/200,  12:54:20 PM
WFMI is another OI call and the stock has completely ignored the recent market volatility. Shares are up six days in a row and currently trading at another new all-time high just under resistance at $80.00.

  James Brown   4/21/200,  12:53:08 PM
ZBRA, an OI call, is bouncing strongly today, up 2.68% and virtually erasing all of yesterday's losses.

  Jim Brown   4/21/200,  12:49:18 PM
SF Fed President Parry saying he sees Fed Funds rate between 3.5%-4.5% OUCH!

  Jeff Bailey   4/21/200,  12:49:14 PM
Taser Intl. (TASR) $88.66 +5% ... fascinating intra-day chart with fitted retracement showing some zones. Link

Not shown would be the 5-MRT, where all be darned if current session high didn't come at BLUE #3. Today's first 5-minute bar was from $70.66 to $78.25.

  James Brown   4/21/200,  12:49:09 PM
General Dynamic (GD) is up 1.84% and nearing resistance at $94.00 after reporting earnings this morning of $1.34 a share. That's 15 cents above analysts' estimates. Revenues for the quarter surged 39% to $4.76 billion, also above estimates. GD also raised its full year guidance to $5.70-5.75 versus estimates of $5.58.

  Linda Piazza   4/21/200,  12:49:00 PM
The Russell 2000 is still climbing within what looks to be a bear flag on the 5-minute chart. The break out of this morning's neutral triangle set up an upside target near 582.85, but as I said with respect to the OEX this morning, don't bet the farm on those upside targets being met in a bearish short-term environment. Be cautious if in a possibly countertrend bullish play. The Russell 2000 is turning down within that bear flag. Current trendline support is near 576.60 but is rising.

  Jim Brown   4/21/200,  12:46:21 PM
I would sure hate to be a market maker in TASR options.

  Jeff Bailey   4/21/200,  12:43:26 PM
Taking some notes .... TASR May $70 puts option symbol is (QURQN). Might need these at some point for a day trade.

  James Brown   4/21/200,  12:43:11 PM
Royal Caribbean Cruises (RCL) is down 3.61% and breaking down through its simple 50-dma after reporting earnings this morning that beat estimates by 5 cents per share. Net profits almost doubled from $53.2 million a year ago to $95.8 million.

  Jeff Bailey   4/21/200,  12:39:28 PM
Taser Intl. (TASR) just checked in... Trading $88.20 and smack dab in that upper "zone" of resistance. (see chart 09:42:59)

Did anyone play? Just curious of there's still some Taserians (as CNBC calls them) out there.

  Linda Piazza   4/21/200,  12:36:56 PM
Still watching to see if the OEX is going to move back above the confirmation level of the double-bottom formation. If it does, it sets up that 552.80 upside target, but I wouldn't bet the farm on upside targets being met in a bearish environment.

  Jeff Bailey   4/21/200,  12:35:53 PM
Jim stepped in with what I'd consider low risk short in futures. Stop just above is my guess. Not bad idea at this point. I don't see much one way or other right now. We "know" we're at/near session highs and session lows give opportunity for gain.

  Jeff Bailey   4/21/200,  12:30:32 PM
Good Gravy! .... MOT pegged at $19.24 still.

  Jeff Bailey   4/21/200,  12:28:30 PM
GSTI Software (GSO.X) 153.73 +0.52% Link ... just noting tentative gain may be coming from its 50-day SMA resistance of 153.71 RIGHT HERE.

Tie to QQQ highs right now.

MSFT $25.35 +0.11% ...

  Jeff Bailey   4/21/200,  12:26:43 PM
QQQ $35.98 +0.84% ... updated 5-minute interval chart. Link

  James Brown   4/21/200,  12:23:14 PM
A reader reminded me to check out chip stock ADI this morning since shares had pulled back to support at $45 and have already begun to bounce. I had mentioned ADI in the past because the stock has been channeling sideways between $44-45 and $51 for the last 4 1/2 months. Looking purely at the chart one could surmise that this would be a bullish entry point to buy calls and play the run back to $50-51. The bounce from $45 this morning was right on time and this time it's boosted by technical support at its 200-dma.

However, I would suggest a little bit of caution today. Prudential just downgraded their outlook on the semiconductor sector and reduced their outlook on ADI to "neutral". More importantly the SOX is trying to rebound from the 470 level and is currently above its 200-dma (but just barely). The short-term trend in the SOX is down. That doesn't mean that ADI can't rebound but weakness in the SOX could seriously hinder any rally attempts in ADI.

Personally, I might still consider this a bullish candidate but with the volatile (a.k.a. weak) market environment I'd probably cut back on my position size and use a tighter stop than normal. Earnings for ADI should be May 13th.

  Jeff Bailey   4/21/200,  12:16:51 PM
Russell 2000 Index (RUT.X) 579.18 +0.58% ... only major average I see to make a session high, but just like INX.X and GSO.X, fractional.

  Jeff Bailey   4/21/200,  12:13:53 PM
U.S. Dollar Index (dx00y) while 30-minute delayed, I'm showing it has recovered from a low of 90.53 to trade 91.08. The 09:10 AM EDT high was 91.15.

  Jeff Bailey   4/21/200,  12:11:34 PM
Motorola (MOT) $19.25 ...

  Jeff Bailey   4/21/200,  12:10:46 PM
GSTI Software (GSO.X) 153.69 +0.49% ... also fractional high. Looking for any sign of strength I can find, but not finding anything overly conclusive.

  Linda Piazza   4/21/200,  12:09:58 PM
The OEX touched the confirmation level of the double-bottom formation, and then retreated a bit. We have to see if that's just a pullback before another assault or the beginning of a bigger pullback.

  Jeff Bailey   4/21/200,  12:09:32 PM
CBOE Internet Index (INX.X) 187.70 +0.87% ... quickly clicking through the sectors. INX.X only one I see to make a very fractional new session high. Morning high was 187.62.

  Jeff Bailey   4/21/200,  12:07:17 PM
Buy/sell programs this is key level right in here isn't it?

  Jeff Bailey   4/21/200,  12:06:39 PM
Sell Program Premium

  Jeff Bailey   4/21/200,  12:06:12 PM
QQQ $36.00 +0.89% ... back near session high of $36.07.

  Jeff Bailey   4/21/200,  12:05:33 PM
Buy Prog. Premium first program since Greenspan concluded testimony.

  Jeff Bailey   4/21/200,  12:03:16 PM
12:01 PM EDT Market Watch at this Link

  James Brown   4/21/200,  12:02:46 PM
Seagate Technology (STX) is down 4.33% and pressuring the DDX disk drive sector after reporting earnings last night that only met estimates of 7 cents a share. Revenues came in under estimates and Merrill Lynch has cut the stock to a "sell".

From the STX press release..." The most substantial impact to Seagate's third quarter earnings results was the reduction in notebook disc drive shipments. On March 2, Seagate believed it would ship around 1.6 million units, but ended the quarter shipping approximately 1 million units. The 600,000 unit shortfall resulted from a combination of a supply imbalance for notebook systems and Seagate's concentrated customer base. These factors will cause further uncertainty during the June quarter.

STX's CEO said, "The next several months will be uniquely challenging as it is the seasonally weakest period of the year in which we are experiencing continued price declines."

  Linda Piazza   4/21/200,  12:02:20 PM
On a move above 549.18, the OEX will have confirmed a double-bottom formation with an upside target near 552.80.

  Linda Piazza   4/21/200,  11:58:58 AM
The Russell 2000 has broken above the descending trendline that it began forming off the 15:34 (2-minute chart) high yesterday afternoon. Because the Russell 2000 had formed a neutral triangle at the bottom of its descent, it's possible to calculate an upside target based on the breakout above that neutral triangle. That upside target is about 582.80, although there's a slightly longer-term descending trendline at 585.30 currently, and I wouldn't be surprised to see the Russell rise high enough to test that, either.

  Jeff Bailey   4/21/200,  11:58:26 AM
QQQ $35.95 +0.75% ... did see a lift from $35.80 as Greenspan concluded testimony.

  James Brown   4/21/200,  11:58:08 AM
QCOM is up 3.05% and bouncing from support near $64-65 after an upgrade to a "buy" this morning. The CDMA giant is due to report earnings after the bell this evening. Estimates are for 49 cents a share.

  Jeff Bailey   4/21/200,  11:56:09 AM
Day trade lower stop alert ... for MOT to $19.52 as Greenspan's testimony concludes. Here's updated 5-minute chart. Link

  Linda Piazza   4/21/200,  11:56:03 AM
I'm finally getting a chart for GMTN, although QCharts lists this as Greenmountain rather than Gander Mountain, the supposed IPO. The first five-minute range was 19.99 to 21.24, for those who would like to follow the stock's trading behavior today according to Jeff's 5MRT.

  James Brown   4/21/200,  11:53:22 AM
Sirius Satellite Radio (SIRI) is down 8.9% to $3.47 and falling fast after reporting earnings this morning. SIRI's net income was a loss of 12 cents, 2 cents worse than expected but revenues jumped 480% to $9.3 million above consensus estimates.

  James Brown   4/21/200,  11:49:22 AM
Dow-component UTX is down 2.93% and under support at $85 and its 200-dma after beating earnings by 2 cents this morning. Its MACD has just painted a new sell signal.

  Linda Piazza   4/21/200,  11:48:59 AM
The current OEX five-minute pattern looks like a pattern characterized as a bearish right triangle--flat bottom and a series of lower highs. That pattern usually breaks to the downside, but I'm not certain in this case because the OEX might be building a double bottom.

  Jeff Bailey   4/21/200,  11:41:01 AM
Motorola (MOT) $19.14 +18% ... tests morning low here.

Semiconductor Index (SOX.X) 470.36 +0.14% ... also just testing yesterday's closing lows. SOX breadth negative at 11:7

  James Brown   4/21/200,  11:36:09 AM
If you'll notice in my previous post Copper futures have dropped strongly today (-6.6%), which follows yesterday's big drop. This has lead shares of Phelps Dodge (PD), a current OI put play, from the $76 level to its current level at $67.51 (-4.44% today).

In last night's newsletter we said that our original plan was to exit near $70 but we had a suspicion that PD might breakdown through support at $70 and keep falling. Our suggestion was to take profits on part (1/2 or 3/4) of your position since PD was so close to $70 and leave small speculative position open on the chance that the stock would break support. Now that PD has broken through $70 we're going to target the 200-dma near $65.00 as our exit point.

  James Brown   4/21/200,  11:31:41 AM
Sector update @ 11:30 AM ET

DFI defense index: +1.50%
DRG drug index: +0.91%
NWX networking: +0.74%
BTK biotech index: +0.72%
HMO healthcare index: +0.72%

XAU gold & silver: -1.33%
DDX disk drives: -1.57%
GHA hardware: -0.74%
OSX oil services: -0.73%
Copper futures: -6.64%

  Linda Piazza   4/21/200,  11:21:25 AM
Although there's still some confusion about names, some are now getting prices for both PROS and GMNT. For PROS, the opening five-minute range (at least according to my charts) was 10.75 down to 10.23, for those who want to follow along using Jeff's 5MRT. PROS is still within that opening range, so in a neutral position. Although a subscriber has reported that GMTN has begun trading, QCharts is not favoring me with a chart for that IPO, and is now telling me that's a GM put, although earlier it attached a different underlying to that symbol. Sigh!

  Jeff Bailey   4/21/200,  11:19:17 AM
Motorola (MOT) $19.23 +18.55% ... still hanging tough. Must be some VERY sideways shorts.

  Linda Piazza   4/21/200,  11:16:11 AM
We have a new low on the OEX, and this time, there is bullish price/MACD divergence on the five-minute chart, as the MACD has not yet made a lower low. Sometimes the slow-moving MACD just has to catch up to price, so this is tentative bullish divergence, but the 21(3)3 stochastics haven't yet made a lower low, either. Careful, short-term bears, as there still may be a countertrend or oversold bounce in the making.

  Jeff Bailey   4/21/200,  11:15:49 AM
Semiconductor HOLDRs (SMH) $37.56 -0.68% ... break below yesterday's lows.

AMKR -1.75%, MU -1.75%, ADI -1.41%, MXIM -1.15%

Breadth now negative at 12:8

  Jeff Bailey   4/21/200,  11:15:14 AM
11:00 Internals at this Link

Yesterday's Internals at this Link

  Jim Brown   4/21/200,  11:09:40 AM
Labor Dept is reporting they will be releasing March PPI at 8:30 on Thursday

  Jim Brown   4/21/200,  11:07:29 AM
Just hitting the wires: Gateway could cut workforce by half in an effort to cut earnings losses.

  Jeff Bailey   4/21/200,  11:06:17 AM
Sell Prog. Premium

  Linda Piazza   4/21/200,  11:03:56 AM
The OEX is trying to steady just above the previous low of the day. No bullish divergence on the MACD, though, so there's no evidence as yet that the OEX will be able to steady here. The 5(3)3 stochastics have made a bullish kiss but having yet moved back above the line indicating oversold conditions, so could still set up in a trending mode.

  Linda Piazza   4/21/200,  10:59:30 AM
Here's what I'm hearing from a trusted reader in response to my report on the possible mixup in symbols on one of the two IPO's scheduled to be released today: I'm getting "Prospect Group, Inc." OTC for PROS symbol. [My note: My original information said that symbol was supposed to be that for ProCentury.] No chart and no news. Not finding any listing on 2 charting services for ProCentury. On one charting service I get the symbol GMTN (it usually also prints the co. name). No chart but has news of the IPO being priced at $16. The other charting service doesn't recognize the symbol.

  Jeff Bailey   4/21/200,  10:59:06 AM
Motorola (MOT) $19.24 +18.6% ... good questions regarding day trade short. I'll address late as I need to get update done, but here's 60-minute interval chart for perspective and plan for today. Link

IF you had been holding long from above $18.25, what might you do today?

If you bought MOT last couple of days, what might you do?

I'd either take profits, sit on sidelines, or have a profit stop under $18.96.

  Linda Piazza   4/21/200,  10:55:25 AM
As I feared it would do early this morning, this OEX bounce is failing from a lower level than I hoped it would, not giving those bears who would have liked a new bearish entry to get in on a rollover from a higher price level, giving them more safety. Let's see, however, if this rollover sticks any better than the bounce did. Sometimes when an index is deeply oversold on a short-term basis and falls out of the first bear flag it forms, it's forming up a new and broader bear flag. A fall below the previous low of the day will undo that possibility.

  Jim Brown   4/21/200,  10:54:50 AM
I would remind those thinking about holding over earnings that WEBX beat estimates by a penny yesterday on a +35% increase in revenue and raised guidance. All positive events. Traders were not impressed. WEBX is down -$6 today.

  Jeff Bailey   4/21/200,  10:48:12 AM
QQQ $35.86 +0.47% ... couldn't quite get a 5-minute bar close above the $36.04 level and fades a bit.

May stay pegged between $35.68 and $36.04 until Mr. Greenspan concludes testimony becomes my thought.

  Linda Piazza   4/21/200,  10:45:43 AM
That tangle of Keltner channel lines I mentioned in my 10:37 post is beginning to separate a little, but not enough to allow the OEX easy progress up through them. They're also descending, as is mid-channel Keltner resistance now at 552.83.

  Jeff Bailey   4/21/200,  10:44:50 AM
Motorola (MOT) $19.25 ... slips back under the $19.29 and RED #1 after its served support for about 20-minutes. Not doing much at this point. Traders can toggle between 2-minute and 5-minute intervals for perspective of 21, 50 and 200-pd SMA's.

  Linda Piazza   4/21/200,  10:43:49 AM
We're supposed to see two IPO's today, Gander Mountain Co. and ProCentury (PROS). Gander Mountain's symbol is supposed to be GMTN, but QCharts is telling me that's Greenmountain, not Gander Mountain. I'm not getting charts on either yet. Gander Mountain is characterized as a hunting, fishing, and camping retail company. PROS is a property and casualty insurance company. The information I received suggested it should already be trading, but I'm not yet getting those charts, as I mentioned. I caution again, especially on a day such as today, that we're watching these IPO's according to Jeff's 5MRT system in an evidence-gathering mode as we don't yet have enough information to know whether this is the ideal tool to use for daytrading IPO's. Six or seven instances doesn't give us that needed information.

  Jeff Bailey   4/21/200,  10:41:56 AM
U.S. Dollar Index (dx00y) 90.86 +0.43% ... at its post 09:05 trade lows.

Mental notes I've made each night when updating the DAILY Pivot matrix is usually, when the dollar trades more than 0.05 below its 09:05 morning low, it usually stays below during the session.

Gold equity day traders might look to play some day trade longs today.

  Jeff Bailey   4/21/200,  10:38:27 AM
U.S. Market Watch at this Link

  Linda Piazza   4/21/200,  10:37:28 AM
Studying the OEX five-minute chart, I note nearest resistance at 548.15, but then a whole tangle of channel lines from 548.87-549.29. When that happens, the OEX usually turns down or else consolidates sideways long enough for the channel lines to move apart and not present such a strong and united bulwark against advances.

  Jim Brown   4/21/200,  10:32:35 AM
Computer Associates CEO Sanjay Jumar is stepping down. He will assume the title of Chief Software Architect. (same as Bill Gates)

  Jim Brown   4/21/200,  10:30:14 AM
Holding over Earnings
I would remind readers as well that only about 20% of stocks rise on the morning after earnings even if they beat the estimates. There are many more factors that can disappoint traders than excite them. The big gains you see on some stocks are primarily due to short covering on stocks with a high short interest that surprise. Those without a high short interest lack this motivating force. Several stocks that beat the street yesterday traded down overnight. Traders hoping for the blowout exit instantly when it does not occur. Holding over earnings is historically very high risk. Still many traders do it. They see the big gains reported for the 20% that do rise and are reported in glowing terms on CNBC. They do not see all the stocks that fall after earnings unless there is a spectacular drop as in TASR. CNBC tends to report the highlights and ignore the lowlights unless they are very news worthy.

We have seen it time and time again where a company beats the street and yest fails in some other area. Guidance is weak or fails to meet the whisper numbers. Sales/revenue may be week in some area. Margins may slip a point. An officer may leave. They could issue some debt. Analysts may downgrade them on price. The possibilities are endless for reasons they decline and very limited for reasons they rise immediately after the event. The most common form of post earnings depression is simply traders taking profits and moving on to the next play. Once earnings are out the expectation is gone. Like presents under the Christmas tree, once one is opened it is rapidly shoved aside in favor of those still unopened and holding the promise of new thrills.

  Linda Piazza   4/21/200,  10:28:31 AM
The Russell 2000 two-minute chart shows a nicely formed inverse H&S, now confirmed, with an upside target near 581.46, just above the 50% retracement of the flagpole drop. If anyone is out there playing the (likely countertrend bounce) on the Russell 2000 this morning, be especially careful at that 581.30-581.50 range. That looks as if it could be a possible rollover point, if the Russell 2000 doesn't roll down ahead of it.

  Jeff Bailey   4/21/200,  10:27:47 AM
Buy Prog. Premium

  Jeff Bailey   4/21/200,  10:27:28 AM
SMH and SOX components to know what stocks comprise each at this Link

  Jeff Bailey   4/21/200,  10:23:42 AM
Semiconductor Index (SOX.X) 478.47 +1.86% ... just like QQQ (see 10:17:42), it too has bounced to its WEEKLY 61.8% retracement (479.37).

  Jeff Bailey   4/21/200,  10:19:38 AM
Sell Prog. Premium

  Linda Piazza   4/21/200,  10:18:15 AM
We're getting our perhaps countertrend bounce on the OEX. The 50% retracement of that flagpole drop is at about 550.77, so the OEX probably shouldn't retrace much higher than that level before breaking down, if this is truly a countertrend or oversold bounce. I wouldn't be surprised to see it get a little higher, though.

  Jeff Bailey   4/21/200,  10:17:42 AM
QQQ $36.03 +0.98% ... may have shot at DAILY R1 today. Here's quick look at intra-day chart with our WEEKLY and MONTHLY Pivot retracement. Morning lows held the MONTHLY Pivot. Link The thin blue line currently in play as resistance is $36.04 and the 61.8% WEEKLY retracement.

Yesterday, for better part of session, QQQ held that $36.43 level and at the time, I felt "fortunate" we got our day trade bearish target there.

  Linda Piazza   4/21/200,  10:16:06 AM
Talking to the holder of those AIG calls and others in losing call positions, I'm reminded to tell readers again to take a look at McMillan's Options as a Strategic Investment for some suggestions of defensive actions that can be taken when a stock declines. Two such defensive actions are rolling down to create a spread by buying a lower strike call and selling two of the held calls for nearly even money, if that is a possibility, and creating a calendar spread. Each of these has risks and benefits, and the strategies should not be considered unless one understands all the ramifications, particularly just ahead of earnings as is the case with the holder of those AIG calls. Whether they're considered at all should be a decision made only after one decides what the outlook for the stock should be. I've recommended this book on other occasions, and it's unbeatable for times like this, when one needs a quick (well, not so quick since it's rather a tome) guide to possible repair strategies.

  Jeff Bailey   4/21/200,  10:05:50 AM
Alternating buy/sell prog. premiums last 5-minutes. Buy first, then sell.

  Jeff Bailey   4/21/200,  10:05:08 AM
Motorola (MOT) $19.27 +18.8% ... here's quick look at intra-day chart with lower 5-MRT (RED) and a quick conventional (BLUE) from yesterday's late session low and this morning's opening high. Link

  Linda Piazza   4/21/200,  10:04:36 AM
Reader Question: I really value your opinion and hope you can shed some light for me. I currently hold 125 AIG $75 MAY Calls. I bought them for $1.30 and my stop is at $.90. They are right on the verge of my stop. I know you cannot provide me with specific position suggestions but with earnings tomorrow morning and currently holding a slightly losing position but above my stop would you hold over earnings? I have never invested in AIG before do you know how they happen to be during earnings season?

Response: Our general policy here at OIN has been that holding over earnings is a roll of the dice. We close out our plays ahead of earnings announcements. While I don't follow AIG closely, and so don't have specific information about how it tends to report (generally beat estimates, history of missing them, etc.), I have been noting sometimes strong reactions in reporting stocks this reporting season. This morning as I was preparing the report on Asian and European markets, it was sometimes difficult for me to ascertain why one stock appeared to be gaining strongly after a good earnings report and another not so strongly. That reaction probably has a lot to do with a stock's recent performance, whisper numbers, and other such matters, and without a familiarity with AIG, I won't be able to help you out there. I took a look at the $IUX, the S&P Insurance Index, to see how insurance stocks were doing generally, and noted bearish-looking oscillators, but also noted that the index appeared to be sitting squarely on a supporting trendline. It's also just above the (green) 72-ema, an average that's seemed to have some relevance to some sectors and stocks. It appears to have that relevance for the $IUX: Link If you study AIG's chart, you see some of the same characteristics, bearish-looking oscillators as that trendline and the 72-ema are tested: Link That suggests to me that AIG might either break through that support or else consolidate along it while the daily oscillators travel down, but this support has been so important that I wouldn't necessarily expect it to drop without at least a tepid attempt at a bounce at that trendline. Will it bounce high enough to help out your position? That, I just don't know as that bounce will be considered countertrend until and unless those daily oscillators turn higher again. The earnings report could send AIG diving through that supporting trendline or else bounce it strongly from that support, and I just don't have information that would tell me which would happen.

  Jim Brown   4/21/200,  10:04:28 AM
Text of Greenspan's speech Link

  Jim Brown   4/21/200,  10:00:46 AM
Greenspan comments from text of his speech
Broad based inflation has not yet begun building. Deflation has come to an end. Fed will act as necessary to limit inflation. Expects hiring to pickup. Fed funds rate must rise at some point to prevent inflation.

  Jeff Bailey   4/21/200,  9:52:28 AM
Alcoa (AA) $32.00 -4.5% Link ... reversing lower PnF sell signal and a triple-bottom sell signal. Vulnerable to $28.00.

  Jeff Bailey   4/21/200,  9:50:25 AM
Day trade short alert for Motorola (MOT) $19.25 here, stop above session high of $19.62 (say $19.70), target $18.25.

  Jeff Bailey   4/21/200,  9:48:31 AM
Semiconductor Index (SOX.X) 475.27 +1.18% while Semiconductor HOLDRs (SMH) $37.90 +0.18% without Motorolla (MOT) $19.22 +18.4%...

  Linda Piazza   4/21/200,  9:47:12 AM
We're not getting our hoped-for bounce up to resistance this morning in the OEX. At least, not yet. Bears should keep following the OEX lower with their stops. The OEX is approaching light historical support near 544. During the first five minutes of trading, the OEX spanned a range from 547.52-546.78.

  Jeff Bailey   4/21/200,  9:42:59 AM
Taser Intl. (TASR) $77.40 -8.2% ... updated daily interval bar chart and thoughts at this Link

  Jeff Bailey   4/21/200,  9:36:47 AM
U.S. Dollar Index (dx00y) 91.12 +0.68% ... here's a quick look at U.S. Dollar Index (dx00y) as it challenges its long-term downward trend and 200-day SMA. I'm looking for support to be firm back at 89.00 level, where gold stocks will be a focus for shorting if tested. Link

  Jeff Bailey   4/21/200,  9:17:28 AM
09:00 Update at this Link

  Jim Brown   4/21/200,  9:03:25 AM
TXN Affirming higher guidance.

  Jim Brown   4/21/200,  9:02:38 AM
BCR announced a 2:1 split

  Linda Piazza   4/21/200,  8:56:18 AM
The OEX pattern that has been building on the 60-minute chart since April 5 has me stumped. On the daily chart, it has looked as if it could be a bull flag, although it's now fallen below a 50% retracement of the previous climb, probably negating that possibility. If you've been reading my posts lately, you know that it's been troubling me all along because of some particularities seen on the intraday charts when studying that formation. It's a broadening formation and flags aren't typically broadening formations. However, it's not one of the broadening formations that I've typically seen. It's not a type with either a flat bottom or top. Nor is it the type that Pring calls an orthodox broadening formation--the type that looks like a megaphone held horizontally. This megaphone is tilted down: Link Since the various types of broadening formations have different implications, I'd sure like to find information about this type, but we do know that it's producing lower lows. It is clear that the OEX has broken below horizontal support near 448.75-449. Whatever the significance of this particular broadening formation, the formation suggests that the OEX might have downside to 539.50, the site of the lower descending trendline.

However, the OEX ended the day extremely oversold on a short-term five-minute Keltner basis. If in bearish positions, it's time to make plans to protect profits, if those plans have not already been made. Follow the OEX lower with your stops. That breakout signal given yesterday on the Keltner charts can be a valid breakout signal and the OEX can continue right on down this morning. It's possible that today we'll see the OEX fall straight down to test 539.50 support, but it's also possible that the OEX will bounce up to test resistance, either in the form of mid-channel Keltner resistance at 554.30 currently but descending or perhaps only far enough to retest the 72-ema, important to the OEX over the last year: Link

I expect a retest of broken support, perhaps near that 72-ema at 551.90 or perhaps near the mid-channel Keltner resistance and grouped 100/130-pma's on several time frames, around 553.50-554. I also suspect we'll see a decline to 539-542. I'm just not sure of the order of those two, and need to see early action this morning. From the first graph in this post, it's clear that the OEX is in the middle of the range predicted by that broadening formation, and entering a trade in the middle of any movement is a dangerous tactic. What I would like to see happen today is a bounce up toward 552-554, the higher the better, a bounce that could take most of a day or even a couple of days, and a rollover from there. I'm afraid that the Keltner resistance will lower during the day and that the OEX might roll over from a lower point. As I type, futures indicate a slightly higher open, but we need to see how the OEX behaves in early trading before we put too much faith in what the futures suggest now.

  Linda Piazza   4/21/200,  8:20:28 AM
Good morning. The Nikkei opened near the flat-line level and traded either side of that level all day, moving in a 120-point range. It closed down 7.96 points or 0.07%, at 11,944.30.

In numbers that demonstrated that exporters hadn't been hit particularly hard by currency issues, Japan's March surplus narrowed as both imports and exports rose month over month. Imports rose 6.5% and exports 1.3%. The numbers also reflected strengthening domestic demand and increasing capital expenditures, requiring the importing of machinery. The narrowing of the trade surplus had been expected, with the surplus not as small as expected.

Despite the encouraging news that exporters hadn't been hit as hard as anticipated by currency issues, it was exporters that suffered in early trading. Many attributed that reaction to Greenspan's testimony on Tuesday as that testimony failed to soothe worries about rising interest rates. TDK and Canon were early decliners, while steel makers Tokyo Steel and Nippon Steel Corp were early gainers. Some techs closed lower, Canon and Hitachi being among them. Most automakers closed higher, although Honda was an exception. Banking stocks turned in a mixed performance. Yahoo Japan rose 0.8% ahead of the after-the-close earnings report, a report that showed FY net income more than doubling, with rising advertising and auction services revenue cited as the reasons for the rise. Trend Micro added to gains made recently, reporting an 80.5% rise in net profit.

Other Asian bourses turned in mixed performances. The Taiwan Weighted gained 0.15%. South Korea's Kospi gained 1.20% although Japan decided today to stop imports of Samsung's Electronics' plasma display panels, a decision requested by Fujitsu. Samsung still gained 1.6%. Singapore's Straits Times lost 0.11%. Hong Kong's Hang Seng lost 1.35% and China's Shanghai Composite declined 1.07%.

Most European bourses currently trade lower as fears about rising U.S. interest rates hit some sectors while today's weaker dollar benefits exporters. Just as Asian auto makers benefited, so did some European car makers. Some big caps reported earnings today in Europe, with mixed reactions to those reports. German chipmaker Infineon Technologies rose in early trading after earnings and a statement that demand for Memory Products had helped pricing considerations. Dutch chip equipment maker ASML fell in early trading after posting a profit and mentioning an order backlog, but also saying that customer demand had been for the less expensive systems. ASML said it expected demand for the more expensive systems to improve during the year. Swiss company Nestle gained in early trading after it beat forecasts, but Swiss drug maker Roche dropped in early trading after it posted gains in sales and gave an upbeat prognosis for 2004's net income.

As of this writing, the FTSE 100 had dropped 36.40 points or 0.80%, to 4532.60. The CAC 40 had dropped 36.04 points or 0.96%, to 3737.39. The DAX had dropped 42.51 points or 1.05%, to 4018.62.

  OI Technical Staff   4/20/200,  9:00:06 PM
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