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  Jeff Bailey   6/24/200,  6:52:48 PM
Pivot Matrix for tomorrow at this Link

  Jeff Bailey   6/24/200,  5:25:55 PM
Closing Internals at this Link

  Jeff Bailey   6/24/200,  4:20:43 PM
Current OPEN mm trades at this Link

showing it earlier before bids/ask backed away on the options.

  Jeff Bailey   6/24/200,  4:09:54 PM
QQQ $37.02 .... that was a late bill out at $37.15.

  Linda Piazza   6/24/200,  4:07:56 PM
The OEX closed right at mid-channel Keltner resistance. As I expected, needed consolidation on bellwether indices prevented others from building on yesterday's gains. Not a bad consolidation-type day if that's all the pullback that occurs, but now some indices present the possibility of reversal signals that could be confirmed tomorrow. Consolidation would be my guess if I were basing my guess only on the knowledge of all the possible market-moving events that might occur next week, but I'm a technical and not a fundamental trader, so I'll want to see what charts show, not what I guess based on outside events. Charts might predict something entirely different, but I want to give myself some distance from the day before I study them.

  Jeff Bailey   6/24/200,  4:07:03 PM
Swing trade cancel alert for the QQQ swing trade long at $37.10.

Can wait until tomorrow for this trade setup in my opinion. With NDX closing just below its DAILY Pivot, then honor as some resistance that bull doesn't need to deal with overnight.

  Jeff Bailey   6/24/200,  4:06:01 PM
NDX.X 1,488.31 .... daily pivots for tomorrow... 1,475.98, 1,482.14, 1,492.05, 1,498.21, 1,508.12.

  Jeff Bailey   6/24/200,  4:03:31 PM
QQQ ... want a "prove it" to me trade at $37.10. See those 5-minute closes at $37.09 this afternoon? Determined type of selling.

  Jeff Bailey   6/24/200,  4:01:19 PM
Buy Program Premium ... SPY $114.53, DIA $104.72, QQQ $37.07.

  Jeff Bailey   6/24/200,  4:00:59 PM
QQQ $37.03 -0.24% .... trade continues... here's intra-day chart of QQQ, thoughts. Link

  Jeff Bailey   6/24/200,  3:54:18 PM
Swing trade long alert for the QQQ at $37.10, stop $36.91, target $37.35.

  Linda Piazza   6/24/200,  3:51:36 PM
If you were short, would you be tempted to cover now, because the indices hadn't actually rolled over? If you'd gone long yesterday, would you be tempted to bail now because there was no follow-through? I'm trying to figure out what's most likely to happen in the last few minutes of trading, but I can't figure out a relative weighting here. Just have to see what happens. Whatever does, this action is pretty much what I thought we'd have today without the leadership of the TRAN and the SOX, which were likely to consolidate or pull back today. Now we have to see if tomorrow produces consolidation or a bounce--the two bullish possibilities--or a deeper pullback, which brings up the possibility that yesterday's runup was as suspect as some feared it might be.

  Jeff Bailey   6/24/200,  3:50:43 PM
QQQ ... thought as it relates to OEX intra-day observation. What would be a good "bull trap" trade for the QQQ?

I'm thinking some type of move above MONTHLY R1 to its WEEKLY R2, then "whack" em.

The "whack'em" trade comes from stock being accumulated here at WEEKLY R1 and DAILY Pivot perhaps. As in... get some long build, to sell at the bid to get the move lower from WEEKLY R2.

  Linda Piazza   6/24/200,  3:48:10 PM
BIX is testing 350, at 350.20 as I type.

  Linda Piazza   6/24/200,  3:44:40 PM
The TRAN has been easing down most of the day, but has so far remained above the midpoint of yesterday's tall white candle, with that midpoint at 3106.66. Currently, the TRAN is at 3126.10. Bulls (in any market, because of the TRAN's importance as a bellwether index) don't want to see a continuation of the pullback tomorrow, with that pullback retracing yesterday's gains. That would signal a reversal just after the TRAN hit a new closing high for the year, leading to questions of whether the move was a fake-out one.

  Jane Fox   6/24/200,  3:44:19 PM
Dateline WSJ - Next week, the Federal Reserve is likely to end the easiest monetary policy in its modern history by raising interest rates for the first time in four years. And if all goes according to plan, the markets will barely blink.

Fed officials are almost certain to boost their target for the federal-funds rate, charged on overnight loans between banks, to 1.25% from 1%, when their two-day meeting ends Wednesday afternoon. They have labored for nearly a year to ensure that this increase, and those to follow, are fully anticipated. The approach reflects a tactical shift to an innovative communications strategy that is aimed at incrementally guiding markets toward the inevitable rate boost.

There may yet be surprises next week. Fed officials are wrestling with whether to indicate, as they did after their May meeting, that future rate increases will be "measured," a euphemism for moving in quarter-percentage-point increments. Some officials, mostly hawkish reserve bank presidents, see the risk of inflation accelerating and think the "measured" language limits their ability to raise rates faster if needed. More dovish officials argue that the term still reflects their likeliest course of action and that they can change their words quickly if inflation does pick up. The latter view likely will prevail, though the Fed may make it more explicit that the measured pace will be dropped if inflation risks rise

  James Brown   6/24/200,  3:41:10 PM
The INX Internet index is challenging the SOX index as the biggest loser on the session while the OSX is a close third. All three are down about 1.2%

  Jeff Bailey   6/24/200,  3:38:52 PM
OEX.X perhaps somebody has already mentioned, but just noting that the OEX traded above its WEEKLY R1 for 20-minutes this morning, like a little intra-day "bull trap" on a false breakout.

  Linda Piazza   6/24/200,  3:37:08 PM
OEX Keltner support trying to firm near 555.60. We'll soon see if it's enough.

  Linda Piazza   6/24/200,  3:34:24 PM
The SOX hasn't been able to sustain levels above 473 and change its Keltner outlook, so 467 still looks possible, although not promised, of course.

  Linda Piazza   6/24/200,  3:28:56 PM
The BIX's Keltner support is trying to firm up just under the current BIX level, but resistance looks fairly firm at just under 351, too.

  Jeff Bailey   6/24/200,  3:27:43 PM
03:00 Internals at this Link

Note change in TICK and NYSE NH indications.

  Linda Piazza   6/24/200,  3:13:03 PM
An OEX slide down toward 554.80-554 now looks more possible. If you entered a bearish play at some point today, remember to watch out for a possible buy program to hit at any time. A drop to 554 and a firming there is not particularly bearish in and of itself, if buyers step in there. If not . . . well, we just have to see if there's any more follow through on pullbacks than on the climbs.

  Jeff Bailey   6/24/200,  3:12:51 PM
SPX.x 1,140.76 -0.28% ... just tested MONTHLY R1 as support.

QQQ $37.01 did trade daily Pivot with low of $36.93.

If we loose these two levels, then I'd have to think today was a reversal day.

  James Brown   6/24/200,  3:11:46 PM
Bulls can keep an eye on Black & Decker (BDK). A move over $62.00 would produce a new triple-top breakout on its P&F chart.

  James Brown   6/24/200,  3:10:26 PM
Hmm.. I can't find any catalyst but shares of Eastman Kodak (EK) are up 3% to $26.60 and breaking out over its 100 and 200-dma's. Currently its P&F chart is stuck right at resistance.

  Linda Piazza   6/24/200,  3:09:24 PM
Jane has already noted the TRIN's level on the Futures side of the Monitor, but I wanted to let those watching only the Options side know that it's risen to a bearish 1.49.

  Jeff Bailey   6/24/200,  3:04:32 PM
03:00 Market Watch at this Link

  Linda Piazza   6/24/200,  3:02:46 PM
The OEX needs to get its act together now and produce a bounce or else it's vulnerable down to 554.00-554.60.

  Jeff Bailey   6/24/200,  2:59:08 PM
Day trade stop alert QQQ breakeven

  Linda Piazza   6/24/200,  2:57:58 PM
Another OEX test of mid-channel Keltner support is coming after a failure to move back above the ascending trendline off the 5/12 low.

  Linda Piazza   6/24/200,  2:54:07 PM
Next OEX Keltner support and resistance are about evenly matched now, with support near 556.40 and resistance just under 557.30.

  Jeff Bailey   6/24/200,  2:52:44 PM
Day trade raise bullish stop alert to break-even in the QQQ.

$37.10 -0.05% here.

  Linda Piazza   6/24/200,  2:50:11 PM
The SOX's Keltner view looks a little different than the OEX's, however. Five-minute resistance looks stronger than support, suggesting that the SOX might decline toward 467.31 unless it can muster the strength to sustain a move above 473.

  Linda Piazza   6/24/200,  2:48:20 PM
It's too early to tell what's going to happen, but OEX bulls need to do a better job here, sending the OEX above 557.50 and sustaining that level. Otherwise, we'll get another test of mid-channel support. That support sure does look as if it's firming up, though, suggesting that it might be easier for the OEX to attempt to rise than decline. We'll have to see.

  Linda Piazza   6/24/200,  2:41:14 PM
Keltner resistance levels for the OEX range from the current level up to 558.51. The level up to 557.50 appears important, however, because they include that long-term trendline the OEX dropped beneath again.

  James Brown   6/24/200,  2:40:13 PM
Traders might watch GRMN for a "fill the gap" play. The stock is nearing resistance at $35.00 again. Shares failed to confidently break over this level in early June but now the stock is above technical resistance at its 50-dma. Once over $35.00-35.40 bulls can look for a move to the top of the gap and/or its 100-dma.

  Jeff Bailey   6/24/200,  2:37:49 PM
QQQ $37.05 -0.18% ... on 5-minute chart intervals... see those two "doji" reversals? 11:40-11:45 was at the high.... 14:20-14:25 ... the low?

Now... watch that one at $37.16 13:45-13:50

  Linda Piazza   6/24/200,  2:37:06 PM
There's a little reverse H&S on the OEX one-minute chart, with the neckline just surpassed at about 556.50, and with the upside target at 557.01. Looks as if we'll get that test of 557, perhaps.

  James Brown   6/24/200,  2:35:17 PM
SSCC also looks like a covered call candidate with its bullish breakout from the five-month trading range and overhead resistance at $19.00.

  Linda Piazza   6/24/200,  2:33:57 PM
The BIX is drawing back toward the early June high of 350.83, with the BIX at 350.96 as I type. So far, there's nothing alarming here, but bulls sure do want to see a close above that early June high.

  Jeff Bailey   6/24/200,  2:33:02 PM
Day trade long alert the QQQ $37.02 here, stop $36.96 target back to $37.20.

  Linda Piazza   6/24/200,  2:32:03 PM
If the OEX is going to turn those Keltner channels up again, then it's got to sustain levels above 557.10 or so.

  James Brown   6/24/200,  2:26:46 PM
Research In Motion (RIMM) continues to trade under resistance at $62.00 as we approach its earnings announcement on June 29th. While I'm certainly not expecting any sort of moves to rival PLMO's recent explosion higher I do wonder if RIMM might be a straddle candidate (to capture any big moves up or down). Unfortunately, the $60 strike July call/put straddle would cost more than $7.00 to buy right now.

  Linda Piazza   6/24/200,  2:23:50 PM
Should be an OEX bounce attempt near here. If not, then perhaps expect a test of 554.

  Linda Piazza   6/24/200,  2:19:48 PM
TRIN moving up again; TRAN and SOX moving down.

  James Brown   6/24/200,  2:19:17 PM
Stales Inc (SPLS) with its bullish triple-top breakout buy signal on its P&F chart continues to look like a potential covered call candidate.

  Linda Piazza   6/24/200,  2:15:35 PM
If we're opening on 2003 rules, here's how it works. There's been a breakdown again under the ascending trendline off the May 12 low (although that's a best-fit trendline with one candle shadow piercing it). This is not the same ascending trendline I mentioned earlier, the one off Tuesday's low--that hasn't yet been breached. The breakdown again under that longer-term trendline is a bearish occurrence, but if we're operating under 2003 rules, this is where a wave of buying hits.

It sounds as if this is tongue-in-cheek, but it's really not. That's exactly what happened countless times in 2003, and if someone out there is in a buying mood, it could happen again. I'm still working under my preferred scenario for the day, but also still watching for clues that something different could occur.

  James Brown   6/24/200,  2:15:05 PM
A reader asked us about Broadcom Corp (BRCM). We're encouraged by the strength in shares of BRCM. The stock has been out performing a number of its peers in the semiconductor sector. The recent breakout over resistance at the $44.00 mark looks good and appears to be an entry point for interested bullish. Its P&F chart is bullish and points to a $62.00 target. If you're a buy the dip kind of trader look for a pull back and bounce from $44.00. We'd probably target a move to psychological round-number resistance at $50.00.

  James Brown   6/24/200,  2:10:44 PM
CHIC is also holding on to its gains from its recent breakout above the $20.00 level. This might be a potential covered call candidate.

  James Brown   6/24/200,  2:09:08 PM
Meanwhile YHOO is holding on to its gains from yesterday's breakout. Earnings are expected on July 7th.

  James Brown   6/24/200,  2:07:57 PM
The SOX appears to be fading from resistance at the 480 level.

  Linda Piazza   6/24/200,  2:06:42 PM
The OEX mid-channel Keltner support now roughly coincides with the ascending trendline off Tuesday's low, with those ranging from 555.90-556.12. We should get a bounce there of some degree of another, and a failure to do so would suggest a fall to lower-channel support, currently at 554.86, but still rising. If bulls are going to defend, here's one place they should do it.

  Linda Piazza   6/24/200,  1:59:37 PM
There may be a small bounce here in the OEX before we know if it's going to reach the mid-channel level on the Keltner's. Resistance would now be encountered beginning at about 557.20 on the five-minute chart, although we can presume some resistance near 557 on a historical basis.

  Linda Piazza   6/24/200,  1:46:19 PM
It's now looking more like a pullback to mid-channel Keltner support (at least) is in the cards for the OEX, although Keltner support at 556.70 may stop its descent. Mid-channel support is at 556.07.

  Linda Piazza   6/24/200,  1:38:45 PM
The BIX holds steady, the SOX continues in its small-range (but bearish-looking on the daily) consolidation day, and the TRAN continues to trade in a comparatively tight range at the top of its recent rally: so far, this continues the scenario with respect to which I've been watching the markets today, but I'm watching for possible new leadership from one of these indices. In either direction.

  Jim Brown   6/24/200,  1:28:53 PM
Editors Play - CECO
CECO trailing stop hit at $44.00 from the suggest entry at $58. Link

  Linda Piazza   6/24/200,  1:27:47 PM
OEX Keltner resistance is beginning to thin out some, but still looks firmer than support. Keltner resistance ranges up to 558.31 on the five-minute chart.

  James Brown   6/24/200,  1:20:45 PM
Computer Sciences Corp (CSC) has been soaring. The stock is up another 2% today marking its sixth gain in a row. There doesn't seem to be any specific news other than an increase in the IT services market.

  Linda Piazza   6/24/200,  1:20:26 PM
Either I'm aging as the day progresses or those five-minute candles are growing smaller, because I've had to tune to a 1-minute chart to see the candles! That's often indicative of a breakout/down to come. The OEX hasn't dipped down low enough that we can definitively say it's headed for mid-channel Keltner support, although that's looking a bit more likely than earlier, but it hasn't yet shown signs of any continuation of this morning's upside breakout yet, either. If that breakout is going to continue and not produce the muted gains/pullback that I expected today, then it should probably do it soon, or else we'll be waiting for a test of the mid-channel support instead.

  Jeff Bailey   6/24/200,  1:18:17 PM
01:00 Internals at this Link

  Jeff Bailey   6/24/200,  1:09:40 PM
10-year YIELD ($TNX.X) 4.656% down 3.8 bp now (DAILY S2) . Just noticing as I update internals that YIELD rebounds after test of WEEKLY S1 (46.16) with session low yield being 46.13 at this point.

  Linda Piazza   6/24/200,  1:05:12 PM
A sustained OEX dip much below 557.70 or especially below 557.45 would begin to turn the shortest-term Keltner channel down inside the longer-term one, suggesting a pullback to 556.60 or even mid-channel support, now at 555.85. Mid-channel support still rises, but the 556.60 line has begun to flatten. Again, it's natural to see the OEX pull back to support and reaffirm it. I'm not suggesting that a pullback to 555-556 would be disastrous. Below 554, I'd start to worry, though.

  Linda Piazza   6/24/200,  12:59:52 PM
OEX Keltner resistance from 558.22-558.30 is now looking firmer than support.

  Jeff Bailey   6/24/200,  12:59:38 PM
Toll Brother (TOL) $43.85 +4.97% ... fitted retracement at this Link

OK, specialist should have things under control by now.

  James Brown   6/24/200,  12:56:58 PM
American Standard Co (ASD) shoots to another new all-time high with today's 2.7% gain after raising its earnings guidance for FY2004. ASD also expects the Q2 to be near the top end of its previous forecasts.

  James Brown   6/24/200,  12:54:17 PM
For those following the low-carb craze... Panera Bread (PNRA) announced that its same-store sales actually fell 0.9% last month (the four weeks ending 6/12). PNRA is down 2.88% but up off its lows for the session.

  Linda Piazza   6/24/200,  12:49:31 PM
The TRIN continues to drop, heading into neutral territory. The advdec line hasn't really picked up, however, and I sure would like to see volume patterns precede breakouts if they're coming. Still, the trend of the TRIN, as Jane sometimes puts it, may bear watching.

  James Brown   6/24/200,  12:47:31 PM
OmniVision Technologies (OVTI) is up 12% to $17.99 after reporting earnings last night that beat estimates by 2 cents. Unfortunately, the rally is failing at the bottom of its June gap down.

  Jim Brown   6/24/200,  12:47:05 PM
The VXO hit a multiyear low on Wednesday at 13.37 at the close as the market broke out. This complete lack of volatility should be a warning that there is a drop in our future EXCEPT that in periods of strong rallies the VXO will tend to lower levels. The strong breakout spike yesterday caught everyone off guard and shorts were covering on all fronts. During that spike nobody was selling into it. This aberration and convergence of events can push the VXO to abnormal levels. New market highs tend to produce new VXO lows as the rubber band gets stretched to new lengths. Eventually the snapback will occur but it can take several days. Basically the volatility is low because all the bad news is priced in and everyone is buying. Strange that it would happen several days before the FOMC/Iraq events but the market is a constantly confusing humiliation device.

  James Brown   6/24/200,  12:44:58 PM
Another education stock is sinking today. This time it's Corinthian Colleges (COCO).. not to be confused with CECO.... COCO is down 12% to $22 after a negative Financial Times article. The entire sector is getting hit hard with one analyst firm downgrading all the major players.

  James Brown   6/24/200,  12:41:18 PM
Rite Aid (RAD) is up 5.8% to $5.27 and breaking out over its descending 50-dma and 100-dma on strong volume. The company reported earnings this morning of 10 cents per share, 5 cents above estimates. Revenues were a little light for the quarter but RAD raised its 2005 revenue forecasts. Q1 same-store sales jumped 5.3%.

  Jim Brown   6/24/200,  12:38:23 PM
FR Board: Speech by Governor Gramlich
Reducing Budget Deficits Link

  James Brown   6/24/200,  12:37:37 PM
Hmm... Sony Corp (SNE) is breaking out over resistance at $37.50 and its converging 50-dma and 200-dma. This could be a bullish entry point.

  James Brown   6/24/200,  12:36:06 PM
Roxio Inc (ROXI) is up 20% to $5.04 after announcing a deal with BBY. BBY will gain a 6% stake in ROXI to help promote the new co-branded Napster website.

  Jeff Bailey   6/24/200,  12:35:04 PM
Dow Jones Homebuilder (DJUSBH) 610.28 +3.56% .... updated chart we built earlier this year at this Link

  James Brown   6/24/200,  12:30:42 PM
Best Buy Co (BBY) is up 2.68% to $53.13 and breaking out over its simple 200-dma after the company announced it was boosting its dividend 10% to 11 cents per share and that its BoD had approved a $500 million stock buyback program.

  Jim Brown   6/24/200,  12:30:02 PM
Editors Play - CECO
I recommend lowering the stop to $44.00 on the CECO puts. Link

  Linda Piazza   6/24/200,  12:29:36 PM
Just reviewing various charts, I note that the Nasdaq's rise certainly negated that building H&S just under its descending trendline off the year's high, didn't it? A couple of weeks ago, Jonathan mentioned that the day felt like a day in the spring of 2003, and this action on the Nasdaq reminds me of 2003, too. During the spring of 2003, especially, but all throughout the year, we kept seeing bearish signals or chart formations that would verge on confirmation or even give a minimal confirmation and then markets would surge higher. Multiple reasons always existed for not trusting the breakouts when they occurred, but markets just kept climbing. I'm not suggesting today that we not honor the breakouts if they continue, as long as we have stops in place. What I am suggesting, however, is that today, this day, might see either muted gains, a consolidation at current levels, or even a pullback, even if markets are slated to move higher. That's predicated on the need of those bellwether indices to pause and consolidate some gains, so that they're perhaps not ready to provide some of the leadership they did in recent days. I'm keeping a watch on the SOX and the TRAN, however, for signs that they're ready to break out again instead of consolidating for the day. I'm also watching the TRIN, dropping again now, for signs of a bullish trend in that indicator (a continual dropping lower). Just as it's possible that bulls could be worried by a failure to follow through on yesterday's gains, shorts or would-be buyers could grow worried by a continued failure to dip. If shorts cover and would-be buyers grow too impatient, we could see the OEX make that drive up toward next resistance, and then toward 563-564 if that next resistance is broached. That's not my best-guess scenario for today, but it could happen a la 2003!

  James Brown   6/24/200,  12:27:14 PM
AT&T (T) is now down more than 9% to $14.91 after last night's revenue "warning".

  James Brown   6/24/200,  12:17:56 PM
The rebound in ONYX pharmaceuticals (ONXX) has produced a breakout over its 100-dma while also producing a new buy signal on its MACD indicator. It also produced a new bullish buy signal on its P&F chart, which now points to a $51 target. One concern would be the 40 & 50-dma's near $46 as overhead resistance.

  James Brown   6/24/200,  12:12:39 PM
Last night we put EBAY on the watch list (again) since the stock had broken out of its bull flag pattern. Bulls could use the move as an entry point with a target of $100.00 (hopefully by its July 22nd earnings announcement).

  Jeff Bailey   6/24/200,  12:12:36 PM
Dollar Index (dx00y) 88.75 -0.74% (30-minute delayed) ... session low so far 88.62, 0.02 above WEEKLY S1 at this point. Note zone of support from WEEKLY S1 to WEEKLY 80.9% retracement (88.65).

Probably don't put on any new metals trades at this point is my thinking, unless a major technical even presents itself.

  James Brown   6/24/200,  12:07:15 PM
The New Homes sales numbers have sent the DJUSHB home construction index to a 3.35% gain and above the 600 level. Unfortunately, it's beginning to fade from its highs.

HOV has broken out above the $35.00 mark and its simple 50-dma.

KBH has broken out above its 100-dma, 200-dma and the $70.00 mark.

BZH shot up above its 100-dma and the $100.00 mark.

LEN is still struggling under resistance at its 200-dma near $46.

TOL is soaring, up two days in a row. If you squint your eyes it looks like a reverse H&S pattern breakout above the neckline near $42.00.

MTH is up three days in a row and breaking out today over its 100-dma and the $70.00 mark.

SPF is breaking out over its 40 & 200-dma but struggling with its 50-dma and the $50.00 mark.

RYL is up strongly today but struggling with resistance at $80.00 and its 200-dma.

PHM shot up to new three-month highs above resistance at $55.00 but is fading from its peak.

  Jeff Bailey   6/24/200,  12:06:49 PM
12:00 Internals at this Link

Yesterday's internals at this Link

  Linda Piazza   6/24/200,  12:03:12 PM
The TRAN still drops, although not alarmingly yet, the SOX consolidates near yesterday's high in a tight-range day so far, but the BIX remains above the early June high. So far, most of this evidence fits the scenario I had for today, with that scenario predicting muted gains on other indices, if any gains were to be had. The TRIN continues too high for bullish hopes, however, always creating the specter of a real drop.

  Linda Piazza   6/24/200,  11:56:36 AM
With that last push higher on the OEX, the five-minute chart showed bearish price/oscillator divergence. Of course, it kept showing the same thing yesterday, too. So far, breakouts haven't produced big gains, as I thought might be possible today.

  Jeff Bailey   6/24/200,  11:44:40 AM
IPIX Corp. (IPIX) $12.66 +5.06% .... updated daily interval chart at this Link

Can tie with point and figure chart. The BLUE retracement was from prior fitted 38.2% and gives tighter levels.

Test today is for IPIX to close above $12.43 ... show some sign of conviction from bulls.

  James Brown   6/24/200,  11:42:40 AM
Meanwhile the rally in PD, another OI call, continues higher. PD is up five days in a row, which has pushed through resistance at its 100-dma and the $75 mark. Short-term traders might want to consider taking some money off the table.

  Linda Piazza   6/24/200,  11:41:35 AM
On the OEX 15-minute chart, upper Keltner resistance now crosses at 559.08. The OEX can and does issue breakout signals on this 15-minute chart, too, but breaking above that resistance, but that resistance often holds, too.

  James Brown   6/24/200,  11:40:56 AM
The rally in MERQ, a current OI call play, is now working on its fourth gain in a row. The stock has finally broken out over resistance at the $50.00 mark.

  Linda Piazza   6/24/200,  11:39:49 AM
Perhaps the BIX will take over a leadership role today?

  James Brown   6/24/200,  11:39:07 AM
We've been waiting for Golden West Financial (GDW) to breakout over the $110 level for days. The stock has finally crept up to resistance to hit $109.89 this morning. Keep an eye on this one for a final push higher.

  Jeff Bailey   6/24/200,  11:36:55 AM
Aluminum Corp. China (ACH) $51.25 +5.19% .... expecting some near-term resistance from $51.91-$54.19 (two retracement)

  Linda Piazza   6/24/200,  11:36:02 AM
The BIX makes a new day's high.

  Linda Piazza   6/24/200,  11:35:41 AM
The SOX moves up, too, but has yet to have reached a new daily high, tagging along behind some of the other indices. The TRAN is not yet moving up.

  Jeff Bailey   6/24/200,  11:34:42 AM
QQQ $37.29 +0.48% ... upside al_rt I had set here per Index Trader Wrap and April 26 relative high.

  Linda Piazza   6/24/200,  11:34:32 AM
New daily high on the OEX.

  Linda Piazza   6/24/200,  11:28:50 AM
As of a few minutes ago, adv/dec ratios for the exchanges were 19:11 for the NYSE and 17:12 for the Nasdaq. Up volume was strong in comparison to down on both exchanges, and new highs numbered 164 to 12 new lows on the NYSE and 98 new highs to 10 new lows on the Nasdaq. Total volume was 435 million on the NYSE and 591 million on the Nasdaq. Volume patterns support the bullish case.

  Linda Piazza   6/24/200,  11:24:52 AM
Both the TRAN and the SOX behave in a manner consistent with the possibility that they'll see the tight-range or pullback type of consolidation day today, continuing the possibility that these benchmark indices won't provide the market boost that they have over recent days. I'm still watching, but so far, that scenario still seems supported by what I see. If it does play out, that might mean other indices will see their gains muted, if any are made. That's not a bearish development if that's all that happens, but then bulls would want to see further consolidation or a follow-through in gains tomorrow. The TRIN's level continues to create worry to any with bullish hopes for today.

  Linda Piazza   6/24/200,  11:14:30 AM
Immediate downturn on the OEX back into the flag formation without reaching a new high. I don't consider the breakout confirmed.

  Linda Piazza   6/24/200,  11:11:54 AM
Breakout on the OEX. Bulls next want to see a new day's high before they consider it confirmed.

  Linda Piazza   6/24/200,  11:10:33 AM
The OEX is testing the breakout level now. Keep an eye on the TRIN and adhere to your stops if you're intending to play a breakout, if it occurs. Something is at work that I don't understand, and when I already believed that gains might be limited as bellwether indices consolidated recent gains or pulled back, this isn't giving me a cozy feeling about long positions. Price must be our ultimate guide, no matter what warnings other indicators might be giving, but we don't have to enter every trade or enter with our biggest typical position size. As I type, the OEX pulls back slightly from the possible breakout level, but still tests it.

  Jeff Bailey   6/24/200,  11:08:39 AM
11:00 Market Watch at this Link

  Linda Piazza   6/24/200,  10:57:52 AM
No breakout on the OEX, at least not yet.

  Jeff Bailey   6/24/200,  10:48:33 AM
IPIX $12.76 +6.14% Link ... one retracement that may really have come into play is that conventional one from the high of $27.42 to $1.90, which has 38.2% at $11.65, 50% at $14.66. Will note the 06/10 intra-day low and today's low.

  Linda Piazza   6/24/200,  10:45:29 AM
Similarly (to the comments in my 10:40 post), market bulls don't want to see the SOX sustain levels below or close below the 50-dma. I'm still working under the tight-range consolidation day or pullback scenarios for the SOX, and I have to say that on the SOX, bulls won't like the form of the day's candle now if the SOX should close below the opening level. We're a long way away from the close, but that push up this morning, rebuffed at 480, will leave behind an upper shadow if the SOX closes at or below its opening level.

As I type, the OEX pushes up again toward a test of the upper resistance on the possible bull flag formation it's been forming today. Support has been holding. We'll see if the breakout occurs, but that TRIN still makes me terribly nervous about trusting what we're seeing.

  Jeff Bailey   6/24/200,  10:41:45 AM
DR Horton (DHI) $30.70 +5.64% Link ... neighbor of mine is sales rep at one of their developments here in Denver. "Business strong" she has been saying.

  Jeff Bailey   6/24/200,  10:40:27 AM
Centex (CTX) $49.55 +5.26% Link

  Linda Piazza   6/24/200,  10:40:02 AM
The TRAN is still slightly negative. A small-range day to consolidate gains is an expected development and not especially bearish, although I think such a day on this index and the SOX might limit gains in other indices. Bulls don't want to see a sustained drop or especially a close below the midpoint of yesterday's tall white candle, though, with that midpoint at 3106.66. Even that would represent a holding at or above recent resistance, however, so in the TRAN's case, it might take a drop below 3060-3070 to really damage sentiment. That would be a retracing of all of yesterday's gains and would create a tweezer-top if the drop occurred today. That's far from happening yet, however, and so far we're just watching under the consolidation-day scenario.

  Jeff Bailey   6/24/200,  10:38:47 AM
Toll Brother (TOL) $43.84 +4.95% Link ... reversing upward point and figure buy signal at $43.

  Jeff Bailey   6/24/200,  10:32:19 AM
Homebuilder (DJUSHB) 618.79 +5% ... good gravy! Bold move above near-term zone of resistance (now support) from 601-607. Looks 656 in next week or so. Upper fitted retracement at 631.65, 656.16, 695.82 (marked the highs) and then 735.49.

Homebuilding stocks would be in the BUILding portion of Dorsey's sector bullish percent. Link

  Jeff Bailey   6/24/200,  10:28:41 AM
IPIX Corp. (IPIX) $12.73 +5.73% ... quick morning reversal.

  Linda Piazza   6/24/200,  10:27:56 AM
This five-minute pattern on the OEX could well be a bull-flag pullback to support, just the kind of action I wanted to see this morning to determine whether that support will hold. I didn't expect to see a high TRIN level today at the open, however. Although it's come down now, that worried me a little, especially since it's begun rising again as I type. I'm also worried about the possibility that we could see a consolidation day due to possible action on the SOX and TRAN, among other indices. Still, stepping away from what I'm afraid may happen (due to past experience as well as the TRIN's action, so not to be completely discounted), the OEX is consolidating in a possible bull-flag formation that is holding above support while five-minute oscillators cycle down. If that support continues to hold until they turn up again and then there's a breakout above the bull flag, that's the kind of action we would have hoped to see today. If anyone is in bullish trades or considering them, however, I would certainly counsel adhering to your stops. Something about this makes me nervous, and I'm not sure whether it's just my natural hesitation or all those factors I outlined earlier. Read this commentary, decide if you agree, and make your own decisions. Be aware of the possibility that gains might be muted as the markets consolidate gains, even if they do rise. The TRIN's action, as well as the TRAN's and SOX's follow-through on the scenario I thought possible today (at least so far) wouldn't tempt me into a bullish play just yet, though, but that's just me.

  Linda Piazza   6/24/200,  10:17:28 AM
Are the bulls slowly winning the tug-of-war this morning? The volatility indices try to turn down now, although only slightly off their day's highs. The advdec line is trying to rise again after dipping slightly.

I'm still not convinced, although I might have to give slightly more points to the bullish camp this morning. I'm still thinking that we might see a consolidation or pullback day on two of the bellwether indices leading others higher yesterday--the SOX and the TRAN--and that makes me question whether other indices would be able to build much on yesterday's gains.

  Linda Piazza   6/24/200,  10:13:30 AM
The BIX has moved above the early June high.

  Jeff Bailey   6/24/200,  10:13:06 AM
OPEN MM trade profiles at this Link

  Linda Piazza   6/24/200,  10:08:59 AM
The OEX came down to test the Keltner support I mentioned earlier. Now we'll see if there's going to be a bounce from that support or if the OEX is going to turn around and fall through it. That support is now grouped near 556.90, and it looks rock solid. If it's not, or if there's not a quick bounce if it's breached, then the OEX is vulnerable to a pullback to mid-channel support, now at 554.23.

  Jeff Bailey   6/24/200,  10:08:36 AM
10:05 Market Watch at this Link

  Linda Piazza   6/24/200,  10:06:46 AM
The TRAN is now lightly in negative territory, and the SOX pulls back from this morning's pop higher. That SOX action keeps alive for the time being that possible scenario I've been building of a SOX tight-range day or pullback to consolidate gains, or maybe even a rollover, although that seems less likely.

  Linda Piazza   6/24/200,  10:04:22 AM
$TRIN continues to drop, advdec continues to rise, and the VIX flattens after having risen. Mixed evidence, but if the TRIN continues to drop at this rate, it will soon be in more bullish territory. It's already dropped to a neutral level. Jane covers this with more experience than I have on the Futures side of the Monitor, but I mention this for the benefit of those who watch only the Options side.

  Linda Piazza   6/24/200,  9:59:53 AM
The TRAN has now inched into negative territory.

  Jeff Bailey   6/24/200,  9:55:58 AM
200-day SMA al_rt ... Networking Index (NWX.X) 257.16 +0.6% ...

  Jeff Bailey   6/24/200,  9:54:54 AM
Taser Intl. (TASR) $35.29 +7.8% .... same fitted retracement chart we've been using at this Link

  Linda Piazza   6/24/200,  9:53:52 AM
The OEX five-minute chart shows Keltner support firming up from 556.71-556.85. Bulls don't want to see that breached by much or there's the risk of turning the shortest-length channel down again. Mid-channel support is now at 554.07, still rising but tempering its rise now.

  Linda Piazza   6/24/200,  9:51:11 AM
QCharts is still missing some quotes, but I see that the SOX has now inched up, as far as I can tell. If my scenario (small-range day or pullback for the SOX) is right, it won't inch up too far. Let's see, but I'll have to discard that scenario if it heads up too far.

  Linda Piazza   6/24/200,  9:45:14 AM
TRIN dropping, but remaining bearish, VIX climbing, and advdec climbing. Some of these signs are bearish, some bullish. Be careful. The market is still trying to sort things out, so we shouldn't be too confident of any one direction just yet, either.

  Linda Piazza   6/24/200,  9:42:58 AM
The TRAN opened above yesterday's close, but is now coming down, perhaps to retest that closing level. The TRAN is another index that might need to consolidate recent gains, but bulls don't want to see it drop below the midpoint of yesterday's tall white candle if it should pull back.

  Jeff Bailey   6/24/200,  9:42:52 AM
eBay (EBAY) $88.72 +0.41% ... shareholders vote to reject the expensing of options.

  Linda Piazza   6/24/200,  9:39:52 AM
One scenario that I'm watching today is the possibility that the two tall white candles on the SOX's daily chart might require at least a small-range day today, if not a pullback, to consolidate those recent gains. That may mean that the SOX doesn't provide the leadership role is has on previous days. We'll have to see if that proves true.

  Jeff Bailey   6/24/200,  9:39:21 AM
TASER Intl. (TASR) $35.70 +8.89% .... surging. Zone of resistance right in here at $35.38-$35.75 from fitted. Bull still long might part with part of the position here if still holding.

  Jeff Bailey   6/24/200,  9:38:50 AM
Aluminum Corp. China (ACH) $48.72 ... delayed opening. Indicated higher at $49.60.

  Linda Piazza   6/24/200,  9:37:55 AM
I'm not sure, but my charting service may have been running behind during the first five minutes of trading. These figures might not be accurate, then, but I show the first five-minute range at 557.22 to 557.03.

  Jeff Bailey   6/24/200,  9:37:38 AM
Stillwater Mining (SWC) $15.73 +0.76% .... opening ticks come right at the 05/27/04 relative high.

  Linda Piazza   6/24/200,  9:36:31 AM
Jane's probably mentioned the TRIN level this morning. Although the TRIN can do weird things early in the morning, and Jane's much more experienced with the TRIN's permutations early in the morning, it's not currently supporting bullish trades. Be careful.

  Jeff Bailey   6/24/200,  9:36:07 AM
U.S. Dollar Index (dx00y) 88.84 -0.64% (30-minute delayed) ... drops below near-term zone of support. Should fall to WEEKLY S1.

  Linda Piazza   6/24/200,  9:34:35 AM
As of 30 minutes ago, crude futures were rising off the ascending trendline that has been building off the 6/09 low. That may likely be a bear-flag formation, but this should be watched.

  Linda Piazza   6/24/200,  9:31:48 AM
The OEX begins the drop to either reestablish support or . . . well, we'll just have to see. The presumption is that it will reestablish support levels. If that's true, the drop might not last long.

  Linda Piazza   6/24/200,  8:52:01 AM
Breakout! Yesterday, indices broke out of recent consolidation patterns, with bellwether indices the SOX, the TRAN and the Russell 2000 leading the way. While the SPX, OEX, and Dow consolidated throughout much of the day before finally breaking out, those bellwether indices climbed all day with barely a hesitation. They carried the Nasdaq along with them for the most part, although the Nasdaq's pauses were a bit more pronounced than that of the other indices.

Late in the day, the OEX rejected the neckline of a continuation-form H&S and soared higher, finally breaking above the 557 level that had been holding it back throughout June. Similarly, the Dow and the SPX broke above weeks-long resistance. A study of the SMH (as a proxy for the SOX) showed that the late-day breakout on the SMH was accompanied by a volume push, too, something that bulls want to see.

If you've been reading my commentary for long, you know that I distrust these late-day movements, just as I do early-morning ones, but that I've also been waiting for a break out of the weeks-long consolidation pattern. I've ignored some breakouts in the past because I didn't think they should be happening, so I'm certainly not suggesting that this be ignored or dismissed. However, especially in light of the economic surprises this morning and the bombing in Turkey last night near the hotel where Bush is slated to stay this weekend, I'm going to want the OEX to prove to us that it really meant to break out, if it will just cooperate.

How could it do that? First, by pulling back to that 556.50-557 level or perhaps as far back as 554, and re-establishing support there. The extreme violation of the Keltner channel upper resistance points to a need for a pullback of some degree, so it's possible that the needed proof will be delivered to us this morning. The OEX may not cooperate, however, and nervous shorts may instead assist interested buyers in sending the indices higher all day instead if this morning's economic surprises don't provide any dip at all.

What if the OEX keeps climbing? Obvious levels to watch for possible resistance are the 15-minute Keltner resistance just below 558.50, together with a number of springtime opens, closes, highs or lows in the 558-559 region. The 560-561 region also saw a number of similar signs that it could serve as resistance, but 562.90-564 appear to be strongest resistance. An obvious target for a continued push higher is the March 562.86 swing high, a target bulls need to see exceeded.

A couple of weeks ago, I mentioned that the daily Keltner chart was pointing to a possible rise to 563, but gave the OEX at least a 50/50 chance of first descending toward 547 before reaching toward 563. The OEX didn't quite make it to 547, dropping to a low of 548.18 instead, but now it's setting up to reach toward that resistance level, except that upper Keltner resistance has now risen to 564.74. An important Keltner-type requirement is that the OEX has to make it through the next level of daily Keltner resistance, currently at 559.89, before it sustains levels below 553, with that action needed in order to keep that Keltner channel pointed up. As the daily Keltner channels appear configured right now, it doesn't look as if a run-up much past the 563-565 level is in the cards, but that configuration could change as that level is tested.

So, that's what happens if the breakout is real and if the OEX meant to break out. Is there any evidence that the breakout wasn't meant to be real? Not really. The BIX closed above 350, sort of putting to rest the possible H&S on its daily chart, although it now needs to confirm the strength by pushing above the 350.83 closing high from 6/07, something it couldn't manage to do yesterday. The SOX climbed and pushed through all sorts of resistance levels. Despite the approach of the Iraq handover and the worry that production really couldn't be beefed up enough to bring prices down much, crude oil prices have stayed relatively tame.

There are, however, a few worrisome facts when stepping back and studying the indices, and we shouldn't lose sight of those. First, the levels of the volatility indices urge caution. They're not good market-timing tools and their determined sinking to lower and lower levels suggests that we might not yet know how low they should go before we act on the "when the VIX is low, it's time to go" saying, but they still signal a dangerous lack of fear in the market. Second, there's the action of the TRAN in contrast to the Dow. The TRAN reached a new closing high for the year yesterday, with the Dow far from doing so. The Dow has another 265 points to go, if I've done my math correctly, and it's got to pass up a lot of strong resistance to make it through those 265 points. Dow theorists will be watching for the Dow to match the TRAN's action in making a new closing high, however, and to do it as soon as possible. The TRAN usually does lead the Dow, so it's not alarming that the TRAN reached that new closing high first, but now we're on Dow-watch as well as Fed-watch. This, too, is not a sound market-timing tool, but it's another bit of evidence we must watch. Also, although crude prices are staying relatively tame, they have been following an ascending trendline since 6/15. While that climb may well be a bear-flag climb, it should be watched.

Then there's the BIX's stop just short of that previous June high, and the SOX's stop at 476.34, right at the 476.30-ish level that shows up over and over at opens, closes, highs, or lows since March. The SOX pushed out of the descending regression channel that has contained its prices since the beginning of the year, but only barely so, and it's done that before only to fall back inside again. Maybe that stop at 476.34 couldn't be qualified as a worrisome sign since daily oscillators certainly point to more upside to come, but the two days of strong gains do suggest a possible short-range day ahead for the SOX as it consolidates recent gains, so that it perhaps won't take the same leadership role today that it has in the previous two days.

Then there's the reaction of the futures overnight. Despite the Nikkei's highest close since late April, if I did my homework correctly, our futures drifted lower. A climb in European bourses did nothing to improve them, either, so they weren't following through on yesterday's gains although overnight developments in other markets were. Of course, it could also be argued that they barely reacted, if at all, to the bombing in Turkey or to this morning's economic surprises. I guess that about evens out the reactions, without giving us a single clue as to direction today. Futures appear to be in a wait-and-see mode, just like me.

Taken all together, these worrisome signs and others don't outweigh the fact that there was a breakout across many indices as well as the OEX. However, although I'm positive about people and their potential, I'm a worrier about the market's performance, particularly when something I say might lead someone to take a position that might not be profitable, so I'm always going to present as balanced a view as I can. Jeff mentioned his "feeling" about the market last night, and rightly stated that we shouldn't be trading on feelings. I agree, but that doesn't mean that we should ignore them, either, because sometimes they're the reaction to subtle clues we're picking up but not yet able to put together into an articulated pattern. Frankly, I'm worried about this breakout's durability, but it's a breakout nonetheless. If the OEX pulls back to support and then climbs again, I'll feel a lot better. If the OEX can't sustain 554-557 on a pullback, however, then I'm really worried about that breakout's durability. (Sorry, I got even more long winded than usual today.)

  Jane Fox   6/24/200,  8:51:33 AM
Dateline CNN - Iraqi sources tell CNN 78 people have died, 233 have been wounded in attacks throughout the country.

  Linda Piazza   6/24/200,  7:03:55 AM
Good morning. The Nikkei gapped higher by more than 70 points in Thursday's trading. The Nikkei added another 90 points during the day to close higher by 163.59 points or 1.41%, at the day's high of 11,744.15. That was its highest close since late April. Yesterday's Standard & Poor's decision to raise the ratings on eight lenders, a decision not announced until after Wednesday's close in Japan, boosted banks. Two government reports helped boost enthusiasm, too. Service industries saw greater than expected growth in April, with the tertiary index rising 2.2% against an expectation of a 1.6% rise. Wholesale, retail and financial sectors boosted spending. In addition, another survey showed that large manufacturers expressed more optimism for the Japanese economy.

Other than bank-related issues, notable gainers include Tokyo Electron, gaining 5.8%, and Sharp, benefiting from an announcement that it will take an almost 9% position in a German TV manufacturer. Notable decliners included Mitsubishi Motors, declining 5.6% as it sold preferred shares to raise funds, and trading company Sumitomo Corp, declining 4.8% after announcing a new public offering for next month.

Most other Asian bourses closed in the green. The Taiwan Weighted gained 0.87%, and South Korea's Kospi rose 3.28%. Singapore's Straits Times gained 0.27%, and Hong Kong's Hang Seng gained 2.65%. China's Shanghai Composite dropped 0.90%, however, one of only two Asian bourses to decline.

European bourses mostly trade higher, too, led higher by tech stocks such as ASML, Infineon, STMicroelectronics, and Alcatel. CNBC Europe commentators this morning mention Alcatel's crossing of its 200-dma as a positive sign for that stock and for the economies. Helping the semi-related stocks was a J.P. Morgan Chase comment that H2 and next-year orders for the semiconductor industry should increase. Mining stocks also rose after news circulated that Rio Tinto Group would increase shipments to Chinese steel manufacturers.

The Bank of England's King reportedly reassured investors today that crude prices would not be deleterious to the U.K. In France, the national statistics office Insee announced that the demand from China and the U.S. would prod the French economy into a 2.3% growth this year, with that growth touted as the strongest since 2000. The same office believes that the French economy will grow 0.5% in the second quarter, down from the first quarter's 0.8% rate. One notable decliner was the U.K.'s mortgage lender HBOS, declining in early trading after announcing that it could miss a target of providing a 20% return on equity.

Terrorism fears perhaps keep the indices from posting bigger gains, however. Although the DAX holds near its open and near the day's high, some other indices drift off those highs as they perhaps react to news of an explosion in Turkey near the location where President Bush is expected to stay when he visits that country this weekend. News reports this morning mention that no one was killed, although some were apparently injured. In Iraq, dozens may have been killed in a series of coordinated attacks against police and government buildings in central and Northern Iraq.

As of this writing, the FTSE 100 trades higher by 16.10 points or 0.36%, at 4,502.80. The CAC 40 trades higher by 40.17 points or 1.08%, at 3,760.31. The DAX trades higher by 65.32 points or 1.66%, at 4,010.42.

  OI Technical Staff   6/24/200,  3:54:40 AM
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