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  Linda Piazza   8/11/200,  10:33:17 PM
OEX Notes: You're going to be proud of me today. Here's my take on the OEX, short and sweet: Link

 
 
  Jeff Bailey   8/11/200,  6:50:16 PM
Pivot Matrix for tomorrow at this Link

 
 
  Jeff Bailey   8/11/200,  5:44:27 PM
Sector bellcurve bullish % from June 30 FOMC meeting to yesterday's close at this Link

 
 
  Jeff Bailey   8/11/200,  4:46:36 PM
Closing Internals at this Link

 
 
  Mark Davis   8/11/200,  4:36:31 PM
Recap of Wednesday's trades...
SPQTL (SPX Aug 1060 put) @ 5.20
SPQTL (SPX Aug 1060 put) @ 5.20, +0.00%

SPQTN (SPX Aug 1070 put) @ 7.40
SPQTN (SPX Aug 1070 put) @ 6.90, -6.75%

SPQTO (SPX Aug 1075 put) @ 9.00
SPQTO (SPX Aug 1075 put) @ 9.50 +5.55%

SPQUJ (SPX Sept 1050 put) @ 12.80 (holding overnight)
___________________________________________
Total gain/loss for Wednesday = +0.00, -1.20%
Total gain/loss for the week = -4.50, -49.17%

Total gain/loss since inception = +13.95, +116.31%

 
 
  Jeff Bailey   8/11/200,  4:29:05 PM
QQQ went out at $32.92 -0.87% ....

 
 
  Mark Davis   8/11/200,  4:20:19 PM
Day Trade Exit Point Alert -
Lower your stops... SPQUJ (SPX Sept 1050 put) to 11.60
We're holding this one overnight again and with stops @ 11.60 are risking about -10%

 
 
  Jeff Bailey   8/11/200,  4:20:08 PM
Current OPEN MM Profiles at this Link

Today's Activity ...

Sold 3 offsetting out-the-money QQQ August $32 (QAVTF) puts at the bid of $0.25. Will NOT close this trade unless the underlying 300 QQQ short is closed at current stop of QQQ $33.55.

Day trade long Microsoft (MSFT) $27.32 was eventually stopped at $27.32 (break-even, or 0.00%). Post profile best of $27.47 not even close to target of $27.60.

 
 
  Mark Davis   8/11/200,  3:58:45 PM
Day Trade Exit Point Alert -
Stopped out... SPQTO (SPX Aug 1075 put) @ 9.50, +5.55%

 
 
  Mark Davis   8/11/200,  3:57:34 PM
Day Trade Exit Point Alert -
We will be exiting this play before the bell... you should be able to get 9.50 right now.

 
 
  Mark Davis   8/11/200,  3:50:02 PM
Day Trade Exit Point Alert -
Cinch up your stops... SPQTO (SPX Aug 1075 put) to 9.50

Let's at least get lunch money out of this one.

 
 
  Linda Piazza   8/11/200,  3:47:57 PM
The bulls were not able to follow through any more than the bears, at least not yet. They were not able to push the OEX above this morning's gap. Now the OEX has returned to test 526-ish support.

 
 
  Jonathan Levinson   8/11/200,  3:43:02 PM
Updated 2-day 10-tick chart of Nymex crude at this Link

 
 
  Jonathan Levinson   8/11/200,  3:41:42 PM
Rising 30 min channel support is currently lined up with fibonacci support of 32.66 QQQ, while resistance is up to 33.12. The short cycle had resolved its chop to the upside and is currently tilting lower from oversold territory with the current wavelet downphase. So we have a short cycle downphase starting within a 30 min cycle upphase- that would suggest a dip to a higher low- I'm guessing 32.80, but a move to 32.72 would work as well. Below that level, the 30 min cycle upphase will begin to stutter.

 
 
  Jim Brown   8/11/200,  3:41:18 PM
James, I agree. I think the vultures are circling to short GOOG the first available day.

 
 
  Jeff Bailey   8/11/200,  3:39:47 PM
Day trade bullish stop alert ... for MSFT $27.32 -1.44% ... (break even)

 
 
  James Brown   8/11/200,  3:32:51 PM
Here's an interesting note for anyone following the upcoming Google IPO. There is a lot of stock coming for sale once they go public. Here's the schedule from their prospectus:

At 15 days... 4,575,048 new shares for sale
At 90 days... 39,081,106
At 120 days... 24,875,091
At 150 days... 24,874,091
At 180 days... 170,784,389

 
 
  Mark Davis   8/11/200,  3:31:29 PM
Day Trade Entry Point Alert -
Go short now... SPQTO (SPX Aug 1075 put) @ 9.00, stop 8.50

We have a confirmed short signal here and I thinks the odds are pretty good we'll get at least a partial retracement into the close after that +7 point SPX flagpole rally (famous last words). I'm not trying to recoup the last short play, that's history... just playing what I think are pretty good odds here. I have to think a lot of it was short covering by stupified bears (of which I'm one).

 
 
  Jonathan Levinson   8/11/200,  3:30:56 PM
30 min channel resistance for QQQ being tested here at 33.03 as Russell2K futures make a new session high.

 
 
  Linda Piazza   8/11/200,  3:30:23 PM
And there's the upside break out of the OEX's possible bullish right triangle. Keene and Mark were talking this morning about the tendency of patterns to morph from one to another, and that's been happening all day today. On the OEX, we've seen diamonds and neutral triangles, broken to the downside; H&S's, broken to the downside; and now a bullish right triangle, broken to the upside. There's been little follow-through on the bearish formations after their confirmations, and now I'm also skeptical of a bullish follow-through, either past 527-528.50 or past 530-533 if the OEX squeaks past that first resistance zone. Perhaps bulls will mount more of an advance than I'm expecting, but this still feels like part of the chop to me.

 
 
  Jonathan Levinson   8/11/200,  3:27:15 PM
30 min channel resistance for QQQ being tested here at 33.03 as Russell2K futures make a new session high.

 
 
  Jane Fox   8/11/200,  3:26:15 PM
James you are right. I read the title of the WSJ article as "Toys 'R' Us Considers Spinoff of Babies 'R' Us" but upon reading the article I see it talks about the Decline in the Toy Business.

 
 
  James Brown   8/11/200,  3:22:48 PM
Jane, Actually TOY is thinking about selling its toy business and expanding its Babys R Us business. Here's the story: Link

 
 
  Mark Davis   8/11/200,  3:19:35 PM
Our SPX Sept 1050 puts are still alive and up about +5.5%

 
 
  Jane Fox   8/11/200,  3:18:07 PM
James I think Toy R Us is selling only the Babies "R" Us division.

 
 
  James Brown   8/11/200,  3:17:12 PM
Did you hear that on CNBC? Toys R Us (TOY) is considering selling off all its toy business. Wouldn't that require changing its name if it no longer sells toys?

 
 
  Jonathan Levinson   8/11/200,  3:14:23 PM
30 min channel resistance is rising along with the 60 min channel, currently up to 33.03. So long as 32.80 holds for any retest in the next hour, the 30 min cycle upphase should strengthen and we'll look for a retest of 33.20 resistance.

 
 
  Linda Piazza   8/11/200,  3:13:24 PM
This is why I just don't trust those continuation-form H&S's. The one I pointed out in my 13:46 post included bearish divergence as the head was formed, and we also saw a first failed test of the neckline level, so most of the ducks were in a row, and there was still no follow-through on the formation.

 
 
  Jeff Bailey   8/11/200,  3:13:18 PM
Bullish day trade raise stop alert .... for Microsoft (MSFT) $27.45 -1% ... to break even.

 
 
  Jeff Bailey   8/11/200,  3:11:55 PM
QQQ $32.95 -0.78% .... DAILY S1

 
 
  Mark Davis   8/11/200,  3:11:35 PM
Day Trade Exit Point Alert -
Stopped out... SPQTN (SPX Aug 1070 put) @ 6.90, -6.75%

 
 
  Jeff Bailey   8/11/200,  3:10:25 PM
Semiconductor Index (SOX.X) 372.15 -5.29% .... highs of the session.

 
 
  Linda Piazza   8/11/200,  3:09:45 PM
If the OEX is going to maintain an equilibrium position with respect to its five-minute Keltner chart, it's reached the channel line that should turn it around, with that channel line at 526.46 currently. The mid-channel resistance on the 15-minute chart is now at 527, known historical S/R and also with this morning's gap, but the 15-minute pattern now looks suspiciously like a bullish right triangle with a flat top at about 526.60 and a bottom line formed off the higher lows. An upside break out of that triangle would set up an upside target that would bring the OEX up to test the 530-533 resistance range, but I'm not discounting the resistance power of the two gaps that lie between the current OEX level and that one, nor am I discounting other resistance between. The OEX is now within the bulb of that possible "b" distribution pattern, and until it breaks out one direction or the other, we're now just getting a lot of choppy trading conditions.

 
 
  Jeff Bailey   8/11/200,  3:08:45 PM
Dow Diamonds (DIA) $99.73 +0.16% ... presses green.

 
 
  Jeff Bailey   8/11/200,  3:08:19 PM
Buy Program Premium ... SPX 1,074.53

 
 
  Jeff Bailey   8/11/200,  3:07:44 PM
03:00 Internals at this Link

 
 
  Mark Davis   8/11/200,  3:03:33 PM
Day Trade Entry Point Alert -
Go short now... SPQTN (SPX Aug 1070 put) @ 7.40, stop 6.90

 
 
  Jonathan Levinson   8/11/200,  3:00:45 PM
Volume is picking up, but still less than the previous buy programs today on QQQ. Next resistance is 32.97-33.00.

 
 
  Jeff Bailey   8/11/200,  3:00:18 PM
Buy Program Premium .... SPX 1,074.39

 
 
  Jeff Bailey   8/11/200,  2:58:33 PM
Buy Program Premium .... SPX 1,073.84 ... (MONTHLY S1 is 1,073.40)

 
 
  Jeff Bailey   8/11/200,  2:55:16 PM
02:50 Market Watch at this Link

 
 
  Linda Piazza   8/11/200,  2:54:13 PM
The OEX is attempting an upside break above the descending trendline built off this morning's 11:15 high. It's also testing the ascending trendline off Friday's low, and that one could catch it again.

 
 
  Jonathan Levinson   8/11/200,  2:53:42 PM
Pennant breakout attempt here, but no volume confirmation.

 
 
  Mark Davis   8/11/200,  2:53:25 PM
Day Trade Exit Point Alert -
Stopped out... SPQTL (SPX Aug 1060 put) @ 5.20 and break even, unbelievable!

 
 
  Jeff Bailey   8/11/200,  2:53:04 PM
Buy Program Premium ... SPX 1,073.77

 
 
  Jonathan Levinson   8/11/200,  2:51:15 PM
Flat pennant on QQQ? Link

 
 
  Linda Piazza   8/11/200,  2:46:16 PM
The OEX has achieved equilibrium on its five-minute chart, now trading just above and below the mid-channel level. It still trades below the mid-channel level on the 15-minute chart, still giving an overall bearish cast to the trading, but of course that depends on the direction of the break, doesn't it? The OEX is trading in an even narrower range than the 3-point range I expected.

 
 
  James Brown   8/11/200,  2:44:17 PM
For those interested in the upcoming Olympic schedule here's a quick breakdown: Link

For some reason I thought there were more events/competitions that what is shown.

 
 
  James Brown   8/11/200,  2:41:00 PM
General Mills (GIS) is voluntarily recalling its Crispy Glazed flavors of Pop Secret microwave popcorn....

" Some consumers contacted the company indicating they have had difficulty preparing the product, resulting in the hot glaze coming in contact with skin and causing burns. The company has notified the Food and Drug Administration of its plan to conduct this voluntary recall. This voluntary recall only includes the two Crispy Glazed flavors and does not include any other Pop Secret products, including traditional Pop Secret Kettle Corn. " (source: company press release)

 
 
  Jonathan Levinson   8/11/200,  2:40:02 PM
QQQ 100-tick 2-day chart at this Link . Coming in for another test of the 32.92 resistance zone, but the wavelet oscillator is overbought. Time for the short cycle bulls to pick up the slack.

 
 
  James Brown   8/11/200,  2:39:19 PM
ABFS is another trucking company upgraded by CSFB and shares are hitting new all-time highs above $36.

 
 
  Jeff Bailey   8/11/200,  2:37:46 PM
Buy Program Premium .... SPX 1,072.01

 
 
  Mark Davis   8/11/200,  2:35:26 PM
Day Trade Exit Point Alert -
I'm now looking at the largest green candle of the day on the SPX cash index. They are really shaking that tree (both ways). Let's just leave our stops at break even and watch the action from the sidelines. I really don't know what to make of all this. My bias remains down and we're still green with two put plays in a no lose situation so let's not screw it up.

BTW, I'm noticing a developing bullhorn wedge on the SPX 1-min chart

 
 
  James Brown   8/11/200,  2:34:11 PM
CNBC mentioned trucking firm Landstar System (LSTR) a couple of hours ago. The stock is up more than 4% on an upgrade to out perform by CSFB. The rally is in its third day of gains and breaking out over the $50.00 mark and its 10, 21, 40 and 50-dma's. The next hurdle is resistance at $53.50.

 
 
  Linda Piazza   8/11/200,  2:31:39 PM
Another failed test of the neckline of the H&S on the OEX's five-minute chart . . . or is this just another squiggle around the equilibrium position on the OEX's five-minute Keltner chart?

 
 
  Jeff Bailey   8/11/200,  2:28:07 PM
Buy Program Premium ... SPX 1,072.36 ...

Note: this is not the first of the day, but thought I'd track to the close.

 
 
  Jonathan Levinson   8/11/200,  2:26:44 PM
I'm staring too closely- still no signals here, with the short cycle oscillators still a choppy mess and the 30 min and 60 min channels perfectly flat. With the 30 min cycle oscillators turning up, my read on it remains the chop we see within a turning/bottoming 30 min cycle. So long as we don't revisit the lows of the day, that's what it should be - but until the 32.97 level gets taken out, it will remain just chop.

 
 
  Jonathan Levinson   8/11/200,  2:22:20 PM
Bonds still climbing, with TNX now down 1.7 bps to 4.268%. Gold and silver are both recovering as well, while the miners remain weak. QQQ is failing on the trendine attempt.

 
 
  Mark Davis   8/11/200,  2:21:59 PM
Man am I ever glad I resisted going long on that last buy signal. It was perfectly legit ('cept for my downward bias)... Now I'm looking at the largest red candle of the day on the SPX cash index.

 
 
  Jeff Bailey   8/11/200,  2:17:09 PM
02:15 Market Watch at this Link

 
 
  Jonathan Levinson   8/11/200,  2:14:12 PM
Rebounding to the trendline at 32.72 QQQ here on a volume spike of approx 1.2M QQQ shares within a 100-tick candle. This is the largest single candle volume in the past hour and a half.

 
 
  Linda Piazza   8/11/200,  2:13:17 PM
The OEX finally broke through the 524 level. If it's going to just squiggle around the equilibrium level on its five-minute Keltner chart, however, it will soon reach the channel line that marks the turn-around spot, the channel line now at 523.47. If the OEX is going to maintain equilibrium through a few hours or a day or more, it will most likely trade through about a 3-point range, currently from 523.47-526.18. It has broken below a H&S formation, but it was a continuation-form H&S, and I just don't trust those as much as topping ones.

 
 
  Jeff Bailey   8/11/200,  2:10:44 PM
02:00 Internals at this Link

 
 
  Jonathan Levinson   8/11/200,  2:08:46 PM
Here's a break of trendline support on the 100-tick QQQ. Look for fib support at 32.66, followed by 32.60.

 
 
  Mark Davis   8/11/200,  2:08:37 PM
Day Trade Exit Point Alert -
Cinch up your stops... SPQTL (SPX Aug 1060 put) to 5.20 and break even

 
 
  Mark Davis   8/11/200,  2:06:57 PM
We just rolled over from a lower high with a nice big red candle on SPX. Hopefully our patience is going to pay off. Did longs get overly ambitious with the Saudi news and bite on something a little too hot?

 
 
  Jonathan Levinson   8/11/200,  2:06:48 PM
Session high for ZN bond futures, with TNX down 1.6 bps to 4.271%.

 
 
  Linda Piazza   8/11/200,  2:05:36 PM
The OEX came up and retested the neckline of the H&S. It couldn't move above it, but has held above 524 support.

 
 
  Jonathan Levinson   8/11/200,  2:03:52 PM
The short cycle QQQ Link shows another retest of rising trendline support connecting the lows of the day. There's been no action during the past hour to change the current mixed short cycle view, and my guess is that the current range is the weightless consolidation chop within a bottoming 30 min downphase, with the next big move to be to the upside. A break of 32.92 confirmed by a move into the opening gap and breaking 32.97-33.00 resistance should be a directional breakout, while a break below the session lows (30 min channel support of 32.55) would signal a whipsaw and more downside to follow.

 
 
  Jeff Bailey   8/11/200,  2:02:43 PM
GSTI Software Index (GSO.X) 128.62 -2.28% .... once againt at DAILY S2. If buyers can't hold here, we could see indices make a move back to morning lows.

MSFT $27.27 -1.62% .... MSFT's DAILY S2 is $27.07 according to QCharts.

 
 
  Jonathan Levinson   8/11/200,  2:01:00 PM
Realtime Nymex crude update at this Link.

 
 
  Jonathan Levinson   8/11/200,  1:56:33 PM
Good luck, Jim- it didn't work for me. Still more chop & flop for QQQ below 32.92 resistance.

 
 
  James Brown   8/11/200,  1:47:20 PM
There's been a lot of talk about the SOX semiconductor index today with its 6.25% drop. Here's a chart with the SOX breaking down through the bottom of its current descending channel. Chart: Link

 
 
  Linda Piazza   8/11/200,  1:46:58 PM
H&S confirmed on the OEX's five-minute chart: Link

 
 
  James Brown   8/11/200,  1:43:03 PM
Smith Barney has cut Weight Watchers (WTW) to a "sell" today. The stock is down more than 3.8% to $35.85.

 
 
  Linda Piazza   8/11/200,  1:41:27 PM
No immediate reversal occurred on the OEX, at least not yet, although more downside needs to follow quickly or else a reversal will be attempted.

 
 
  James Brown   8/11/200,  1:41:11 PM
Ouch! Kulicke and Soffa (KLIC), a semiconductor stock, is down more than 25% to $5.25. The move is investor reaction to KLIC's revenue warning.

KLIC now expects $135-165 million compared to analysts' estimates at $186 million.

Here's an excerpt from their press release: "Our revised guidance is based on our customers' latest indications regarding wire bonder capacity. Some customers are now more cautious about the timing of future demand."

 
 
  Linda Piazza   8/11/200,  1:37:34 PM
The OEX just broke to the downside out of that possible diamond/possible symmetrical triangle. As I expected, the break came during the 1:35-1:45 stop-running time frame. Bears do not want to see an immediate reversal higher.

 
 
  Mark Davis   8/11/200,  1:35:25 PM
We now have a confirmed short signal on the shortest time-frame (1-min chart) Link

Whether or not it holds is anybody's guess but I'm glad we lowered our stop on SPQTL (SPX Aug 1060 put) to 4.90... otherwise we would have been stopped out. I will probably leave the stop @ 4.90 until we get a definite downside break, then we'll follow it down, starting with the stop back to break even.

Our other play, SPQUJ (SPX Sept 1050 put) stop 12.80 and break even, is currently up a little over +9%.

We're getting some downside traction as I type this.

 
 
  James Brown   8/11/200,  1:34:26 PM
I was trading emails with a reader as we discussed the idea of a bounce in the NASDAQ. The breakdown under the 38.2% retracement level looks like bad news and it also represents a breakdown under the descending trendline of support (the lower lows) over the last few months. The NASDAQ appears to have already tested this broken support (at the trendline and retracement level) as new resistance. However, the NASDAQ also has a longer-term trendline of rising support somewhere around the 1750 region. Jon Levinson had this line of support on his NASDAQ chart in the Monday wrap.

Here's a chart: Link

 
 
  James Brown   8/11/200,  1:24:08 PM
Abercrombie & Fitch (ANF) is down more than 11% and gapping down under support at $32.00, the simple 200-dma and the $30.00 level. Yesterday ANF beat estimates by a penny but guided lower. Wall Street has responded with some downgrades.

 
 
  Linda Piazza   8/11/200,  1:23:10 PM
It looks to me as if the OEX is trying to establish an equilibrium position with regard to its 5- and 15-minute Keltner charts, something that we haven't seen for a while as the OEX was declining so steeply. That could mean that we're in for a period of boring trading today, but that perception is countered by that perhaps-diamond, perhaps-symmetrical-triangle seen on the five- and fifteen-minute charts. That's narrowing down enough that it should break one direction or the other by about 2:30, with most such formations breaking before they reach the apex. Still, between now and 2:30 does give us enough time to be bored, doesn't it?

 
 
  James Brown   8/11/200,  1:19:50 PM
Yesterday Jim mentioned the earnings warning from Natl Semiconductor (NSM) after the closing bell. The stock is down more than 14% on more than twice the average volume as it falls under its 200-week moving average.

 
 
  James Brown   8/11/200,  1:16:33 PM
Specialty grocer Wild Oats Markets (OATS) is up another 1.6% in a three-day rally as shares produce a nice oversold bounce. Speculative traders might consider it for a climb toward the simple 10-dma at $9.50.

 
 
  James Brown   8/11/200,  1:12:27 PM
Marching to the beat of its own drum... French drugmaker Aventis (AVE) has rebounded from the bottom of its 6 1/2 month trading range at $75 to the top near $81.00. Bulls can be ready for a breakout above $81.50 as a potential entry point. In the news AVE announced it has submitted an application to the FDA for its ADACEL vaccine for the prevention of tetanus, diptheria and pertussis in adolescents and adults.

 
 
  Mark Davis   8/11/200,  1:12:04 PM
Stepping away for a few minutes...

 
 
  Jeff Bailey   8/11/200,  1:10:09 PM
GSTI Software (GSO.X) 129.15 -1.88% .... challenging mid-morning highs, gets the bounce from DAILY S2 re-test.

 
 
  Jeff Bailey   8/11/200,  1:08:37 PM
Day trade long alert .... for Microsoft (MSFT) $27.32 -1.44% here, stop $27.15, target $27.60.

 
 
  Mark Davis   8/11/200,  1:07:24 PM
Day Trade Exit Point Alert -
Lower your stops... SPQTL (SPX Aug 1060 put) to 4.90
We're risking about 5% but I see a possible short signal developing.
We'll raise them back to break even as soon as possible, or just get stopped out.

 
 
  Jeff Bailey   8/11/200,  1:06:41 PM
01:00 Internals at this Link

 
 
  Linda Piazza   8/11/200,  1:02:40 PM
Traders can't decide what to do with OEX stocks. As proof, they've traded the OEX into a symmetrical triangle today, although it's also possible to classify the action as a diamond shape if you start it back about mid-morning yesterday morning. Those are bearish formations, typically, but I'd rather go with the neutral-ish interpretation of the symmetrical triangle and let a price break tell me what direction the OEX is likely to head. As is oh-so-typical, the OEX is due to break out of that triangle any time from now until the usual stop-running time of day, from about 1:35-1:55. Jim notes a different time when program trades tend to come in, and that stop-running push does fluctuate sometimes, but the narrowing-to-an-apex action often comes as this time approaches. Perhaps that's to confuse us as to whether a break outside the triangle is just a stop-running push that might soon get reversed or is the real thing? Seriously, it's normal for the big girls and boys to want to see whether support is going to hold or resistance is going to hold before they go long or short. If I had the money to move the markets, I'd be testing the waters, too.

 
 
  Jonathan Levinson   8/11/200,  12:58:12 PM
Jim's observation about volume sums it up for QQQ as well, and my tick charts have correspondingly slowed to a crawl, leaving the choppy short cycle oscillators and the flat 30 min cycle channel unchanged for the past 20 minutes. I need to step away here for about half an hour, and the way this is going, I don't expect to miss much (famous last words).

 
 
  Jeff Bailey   8/11/200,  12:57:33 PM
12:53 Market Watch at this Link

 
 
  Mark Davis   8/11/200,  12:55:48 PM
Trying to think like a bull here... would I want to jump in long ahead of the Republican Convention and Olympics, and the associated terror risk?

Bears might be thinking... "I have some pretty good gains here... maybe take a little off the table?"

MMs and institutions probably have concocted a devious plan to run the stops in both directions (cynical me).

 
 
  Jeff Bailey   8/11/200,  12:52:06 PM
Securities Broker/Dealer Index (XBD.X) 117.19 -0.74% ... today's range pretty much bound by the QCharts' WEEKLY Pivot (116.25) and WEEKLY R1 (118.09)

 
 
  Jeff Bailey   8/11/200,  12:50:25 PM
S&P Banks Index (BIX.X) 347.77 +0.37% .... has been sitting here at DAILY R1. Not offsetting today's weakness in technology by any means, but fractional gains a day after Fed rate hike.

 
 
  Mark Davis   8/11/200,  12:49:59 PM
The current range on SPX is becoming clearer... 1070-1072, above or below either number we could begin to see some traction, although a break above 1072 is looking like it might produce a sell signal.

 
 
  Linda Piazza   8/11/200,  12:43:37 PM
At its high of the day, the TRAN had risen to test its 50-dma, falling back from its test of that average and historical horizontal resistance.

 
 
  Jeff Bailey   8/11/200,  12:42:18 PM
Calpine (CPN) $3.64 +12% ... percentage gainer on the big board after Lehman Bros. upgraded to "equal weight" from "underweight."

 
 
  Jonathan Levinson   8/11/200,  12:35:24 PM
Silver has recovered some of its losses, down 2.77% at 6.539. Gold is down 5.30 at 397, also stabilizing above the lows (395), while the miners remain weak, HUI -1.71% at 180.42, XAU -2.09% at 84.65.

 
 
  Mark Davis   8/11/200,  12:34:20 PM
I sure would like to SPX 1070 get taken out.

 
 
  Jonathan Levinson   8/11/200,  12:34:04 PM
The 30 min cycle channel for QQQ has now lost its upphase but is not pointed down- sideways here, just like the short cycle oscillators.

 
 
  Mark Davis   8/11/200,  12:31:52 PM
Short signal developing right at the last swing high... if we roll over from here we may be in the clear for the rest of the day. I'm still expecting fears of previously mentioned risks to kick in sometime today.

Since we're already short and in the green with stops @ break even we can comfortably sit back and watch.

 
 
  Jonathan Levinson   8/11/200,  12:30:00 PM
Nymex crude is bouncing again: Link.

 
 
  James Brown   8/11/200,  12:29:13 PM
OI put play WHR is down more than 2% and completing the failed rally over the last two sessions. The drop back under $60.00 looks like an entry point for puts.

 
 
  Jonathan Levinson   8/11/200,  12:28:19 PM
The drop has stablized here on the bottoming wavelet oscillator, but the short cycle has lost its upphase and is currently choppy and directionless. On a 30 min cycle basis, the downphase is not yet over, and the uncertainty is going to surround whether the last short cycle upphase was strong enough to abort the longer downphase or not. A break below the session low would be required to confirm that the downphase is still in progress. Any failure of bears to push to new lows would likely set up a chop zone here as a 30 min cycle bottom builds. The 30 min cycle has support at 32.60 and resistanc at 32.97, and I'd narrow the range further to 32.65-32.92. A break of that narrow range looks to me like it should be directional, particularly if accompanied by expanding volume, and a move through the broader 30 min channel targets would comfirm it.

 
 
  James Brown   8/11/200,  12:28:19 PM
OI put play RIMM is down more than 3% and trading back under the $55.00 level.

 
 
  James Brown   8/11/200,  12:26:36 PM
OI put play EBAY is bucking the downtrend with an 11 cent gain. The stock is testing its simple 10-dma, which could be overhead resistance.

 
 
  Mark Davis   8/11/200,  12:26:01 PM
Day Trade Exit Point Alert -
Cinch up your stops... SPQTL (SPX Aug 1060 put) to 5.20 and break even
We may be getting a bit too close to the action here but I like the idea of being in a no lose situation on both our short plays. We can always reenter at a higher level if stopped out. Both plays are in the green by about +10%... the Sept 1050 puts a bit higher than the Aug 1060 puts.

 
 
  Jeff Bailey   8/11/200,  12:25:39 PM
Bearish day trade setup alert .... looking at a potential day trade short in Verizon (VZ) $39.32 +0.58% ....

 
 
  James Brown   8/11/200,  12:24:42 PM
OI put play AMZN is pacing the drop in the INX Internet index but still trading above the $35.00 level.

 
 
  James Brown   8/11/200,  12:23:38 PM
OI call play SYMC is holding up very well, down 22 cents to $46.06, in spite of a 2.2% drop in the GSO software index.

 
 
  James Brown   8/11/200,  12:22:54 PM
Recently added OI call play POT is holding up pretty well. The stock is down 62 cents at $101.55. Traders bought the dip to $101 this morning.

 
 
  Linda Piazza   8/11/200,  12:19:02 PM
For the last two 15-minute periods, the OEX has found resistance just where bears would want it to find resistance--at a Keltner line now at 524.69. While it's pierced that line briefly, it has always fallen back and closed the 15-minute period below that line. Bears would prefer to see this action continue. What they'd actually like to see happen is a sustained move below the channel line currently at 523.22, however, to turn that channel lower and not just keep it flat.

 
 
  Jeff Bailey   8/11/200,  12:17:59 PM
12:15 Market Watch at this Link

 
 
  Mark Davis   8/11/200,  12:16:38 PM
Keene I have a feeling at some point today all the excitement over the Saudi news will begin to fade and fear of other previously mentioned risks will return... just a feeling, but the market seems to be running on feelings today. I like the stairstep lower on SPX since the initial knee-jerk reaction, although I'm showing a developing buy signal right here @ the 1070 area, still unconfirmed.

 
 
  Jonathan Levinson   8/11/200,  12:13:34 PM
The break below 32.72 QQQ is spelling trouble for the young short cycle upphase Link and rising support connecting the previous day lows is breaking here. Look for next support at rising 30 min channel support fo 32.58, but if we don't see a quick reversal to the upside, the 30 min cycle channel will whipsaw back down.

 
 
  Jeff Bailey   8/11/200,  12:10:51 PM
GSTI Software Index (GSO.X) 128.64 -2.25% .... back at its QCharts DAILY S2 after little "pop" to 129.22.

QQQ $32.68 -1.59% ...

 
 
  Linda Piazza   8/11/200,  12:06:40 PM
Five-minute Keltner support just above and below OEX 525 appears to be strengthening.

 
 
  Jeff Bailey   8/11/200,  12:05:25 PM
12:00 Internals at this Link

 
 
  Jonathan Levinson   8/11/200,  12:02:41 PM
Nymex crude oil chart at this Link.

 
 
  Mark Davis   8/11/200,  12:01:11 PM
I may be tempted to try a counter long play, depending upon conditions, if SPX gets down to the 1067.50 area again. The SOX has traded in a very tight range since just after the opening bell, currently printing 368.27, -6.28%... LOD was 366.77. I mention these numbers because they tie in closely with a chart of the SOX I drew back on July 1st. Link

 
 
  Jonathan Levinson   8/11/200,  11:56:09 AM
Note the potential bullish divergence on the 30 min Naz futures chart: Link . A break back above 33 should be enough to give us some preliminary confirmation that it will take hold. But until bulls t turn this downphase around, the potential for more downside tests remains.

 
 
  Linda Piazza   8/11/200,  11:55:11 AM
Depending on what happens today, of course, the OEX appears to be building a possible "b" distribution form on its daily chart: steep fall, rectangular consolidation at the bottom of that fall. That's typically a bearish formation and can be used to set a downside target upon a breakdown out of that formation. In this case, that target would be at about 499.50-500, agreeing with some Keltner channel targets. We have not seen that breakdown yet, and we have seen many formations fail to confirm as expected or meet their targets if they do. However, a breakdown below recent lows might suggest that the formation is a "b" distribution pattern. Some might want to consider entering bearish positions on bounces up to/near to the top of the bulb of the "b" formation, near 527-528, being ready to bail if the OEX instead breaks to the upside, setting a stop an account-appropriate distance above yesterday's high. Some might want to wait for a breakdown, although that presents the possibility of a stop-run prompting an entry, with that stop-run immediately reversing.

 
 
  Mark Davis   8/11/200,  11:54:51 AM
Jim wait... what's your phone number? LOL

 
 
  Jonathan Levinson   8/11/200,  11:52:47 AM
The dip trying to end here was a wavelet downphase that broke 32.78 support but reversed from 32.72. A fresh wavelet buy signal is printing right now from oversold territory, and 32.78 is now acting as resistance. The 30 min channel has risen to 32.97, former confluence for QQQ, and the short cycle upphase is still intact. The test for bulls here is to get back to or above 32.92, being the resistance on the last wavelet upphase, which will keep the short cycle upphase alive and target a test of 32.97.

 
 
  Linda Piazza   8/11/200,  11:47:36 AM
The OEX Keltner support held no better than it had held as resistance during the spike higher. The OEX is again easing below the ascending trendline off Friday's low. From a Keltner chart perspective, it looks rather unsupported right now, with resistance again trying to firm up near 525. That suggests that the OEX will have an easier time heading down than up, but we saw how that worked this morning.

 
 
  Mark Davis   8/11/200,  11:45:08 AM
Jim that number is for "fat chance" of reaching me... except in your case I'm already compromised. Ha ha ha

 
 
  Linda Piazza   8/11/200,  11:38:29 AM
The TRAN may have risen past the head level of its potential H&S, but its 15-minute chart has been showing clear bearish price/RSI divergence since yesterday morning. Each higher high since then has been accompanied by a lower RSI high. Clearly, one shouldn't trade based on that information alone--the TRAN has continued to rise, somewhat sharply this morning, for example--but it offers a warning that the rise might not be showing the strength that it appears to be showing.

 
 
  Jim Brown   8/11/200,  11:37:59 AM
Mark, is that number for Suicide Prevention or Dial A Prayer?

 
 
  Mark Davis   8/11/200,  11:35:50 AM
Stepping outside for a breath of fresh air... call me if there is an emergency.
1-800-LAF-ATAK (grin)

 
 
  Linda Piazza   8/11/200,  11:35:16 AM
The OEX currently tests gathering support near the midline of its 5-minute Keltner channel. Since the last trade yesterday afternoon, the OEX has spanned the entire width of its Keltner channels, from top to bottom, rose again to overshoot the mid-line level by a bit and now settles near that mid-line level again.

 
 
  Linda Piazza   8/11/200,  11:32:20 AM
Isn't it interesting that the Saudi announcement came just ahead of this morning's information on crude/distillate/gasoline inventories? Wonder what they'll show?

 
 
  Linda Piazza   8/11/200,  11:29:29 AM
The OEX did reach into that gap from this morning, turning down from that test. It's now about to test gathering Keltner support near 525 to see if that holds any better now as support then it did as resistance after the news that Saudi Arabia was going to make an announcement. The 15-minute Keltner chart shows that resistance is trying to converge again near 527-528.40, and that the OEX would probably again have difficulty with that level if it were to find support now and try to rise again. Keltner lines were somewhat scattered by the post-Saudi-excitement and so now are trying to converge again.

 
 
  Mark Davis   8/11/200,  11:23:43 AM
I think they are breaking out the party hats a bit prematurely on the Saudi news. The oil shortage, terror risk of the interruption of oil flow, Olympics terror risk and the tech wreck have not disappeared.

I'm thinking we may have seen the HOD with that print just above SPX 1075... both our plays are still alive. In retrospect, it was a good thing I kept the stop @ break even on the SPX Sept 1050 puts, although I certainly didn't think we would come as close to being stopped out as we did.

 
 
  Jonathan Levinson   8/11/200,  11:15:37 AM
This move was persistent enough to turn the 30 min cycle channel up- resistance rises to 32.90, support to 32.50. Careful though- volume is declining on this last leg up. Watch for prior resistance at 32.78 to hold on any pullback. So long as it does, bulls should be OK.

 
 
  Jeff Bailey   8/11/200,  11:14:51 AM
11:05 Market Watch at this Link

 
 
  Mark Davis   8/11/200,  11:13:45 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPQTL (SPX Aug 1060 put) to 4.70
I don't want to risk more than 10% on this one

 
 
  Jane Fox   8/11/200,  11:13:31 AM
More on the Oil front. Dateline WAJ - MOSCOW -- Russian energy officials have asked government bailiffs to give OAO Yukos access to its frozen bank accounts, saying oil production and exports from the country could be hurt substantially if the company is forced to cut output.

Sergei Oganesyan, head of the Federal Energy Agency, said Wednesday that a drop in production from Yukos -- Russia's largest oil producer -- could be detrimental to the country as a whole.

"It's very possible that Yukos will have to halt output. It's impossible for a company to produce oil without financing," Mr. Oganesyan told Dow Jones Newswires.

Yukos executives have repeatedly said they will have to scale back output if bailiffs don't give the company access to cash.

 
 
  Jim Brown   8/11/200,  11:12:53 AM
Jane's comment about peak production from OPEC being only 600,000 barrels above its current output just brings back the talk about Hubbert's Peak and the speculation that global oil production has peaked around 83 million barrells per day and will never exceed that level. Demand will continue to climb but existing oil fields are being depleted faster than new fields can be discovered and exploited. Link for a full description of the Hubbert's Peak scenario: Link

 
 
  Linda Piazza   8/11/200,  11:12:49 AM
So far, the OEX has not quite made it to the bottom of this morning's gap lower, but it may not yet be ready to give up and reverse. The OEX five-minute Keltner chart shows support trying to gather near 525 after the OEX blasted through the slightly lower resistance. (Note: The OEX climbed as I typed this.)

 
 
  Jim Brown   8/11/200,  11:07:57 AM
Mark, you beat me on that one. I was a little late on the trigger. That spike just gave those who wanted to be short another chance at a higher level. The news of the additional oil production available did not say they were going to produce it or there would be enough tankers to deliver it. With the 4 million barrel draw down in today's report there are going to need something more concrete to produce a real and lasting rally.

 
 
  Linda Piazza   8/11/200,  11:07:56 AM
Prior to the announcement that Saudi Arabia would have an important announcement, the TRAN had been doing a nice job of setting up the potential H&S that I mentioned earlier, but since that announcement, the TRAN has shot past the right-shoulder level at the 15-minute 100/130-ema's and has now far exceeded yesterday's high. With crude prices being such a governor of market behavior, the TRAN seems a more important indicator index to watch than even the SOX.

The TRAN has, however, now moved into the 3060-3070 next resistance band, with the 50- and 30-dma's waiting above that at 3080 and 3092.

 
 
  Jane Fox   8/11/200,  11:06:44 AM
Dateline WSJ - LONDON -- The world oil market is tight and uncertain, the International Energy Agency said Wednesday, but it questioned whether soaring prices were justified while supply still exceeds demand.

The IEA described the run-up in oil prices as "irrational exuberance" and cited a host of reasons for oil-supply worries to ease.

It also noted that prices are already slowing demand growth in the two biggest oil markets, the U.S. and China.

But the agency's data show that OPEC's "effective" spare oil-pumping capacity has slipped to just 600,000 barrels a day, in a global market of 82 million barrels a day.

 
 
  Mark Davis   8/11/200,  11:05:13 AM
Good timing Jim (grin)

 
 
  Jonathan Levinson   8/11/200,  11:05:00 AM
Session high for GE at 31.95.

 
 
  Jeff Bailey   8/11/200,  11:04:44 AM
Airline Index (XAL.X) 43.40 +3.13% .... big jump on OPEC headline

 
 
  Mark Davis   8/11/200,  11:04:32 AM
Day Trade Entry Point Alert -
Go short now... SPQTL (SPX Aug 1060 put) @ 5.20, stop 4.50

 
 
  Jeff Bailey   8/11/200,  11:04:05 AM
Biotechnology Index (BTK.X) 464.90 +2.13% ....

 
 
  Jeff Bailey   8/11/200,  11:03:38 AM
Market Volatility Index (VIX.X) 17.99 +2.97% .... makes a session low.

 
 
  Jonathan Levinson   8/11/200,  11:03:16 AM
QQQ approaching descending 30 and 60 min channel resistance right here at 32.85. If the bulls are serious, then the price will hold these levels or better for the next 10 minutes, long enough to turn the now flattening 30 min channel higher. All the volume here is on the buy side, and it's looking good for the time being.

 
 
  Linda Piazza   8/11/200,  11:02:44 AM
I was surprised that the expected Saudi announcement hadn't made an impact sooner, but here's the expected push higher. The OEX broke out of the until-then-likely bear flag, breaking to the upside. All bets appear off for the short-term. If too many stops get triggered, shorts will begin covering (probably already have) and the thing will snowball. If the OEX isn't quickly slapped back now, I wouldn't be surprised to see a gap test, at least, of this morning's gap lower. What can Saudi Arabia say that will really change the outlook, though, important as their announcement might be, unless they've discovered a new oil field somewhere? Of course, we know that there's event premium built into the cost of crude, and it's possible that some of that event premium could evaporate for the time being, but there are still threats and still production problems.

 
 
  Jeff Bailey   8/11/200,  11:01:34 AM
Swing trade sell QQQ put alert .... selling 3 of the QQQ August $32 puts (QAVTF) at $0.25 bid.

This against the current underlying short of 300 shares in my MM profiles.

 
 
  Jim Brown   8/11/200,  10:59:32 AM
News hitting the wires now - Saudi Arabia claims it has immediate daily production available of 1.3 million barrels to head off the oil price crisis.

 
 
  Jeff Bailey   8/11/200,  10:58:47 AM
S&P Banks (BIX.X) 346.81 +0.09% .... bids green.

 
 
  Jonathan Levinson   8/11/200,  10:58:15 AM
Nymex crude back down to 44.125 here.

 
 
  Mark Davis   8/11/200,  10:57:43 AM
Potential Day Trade Setup Alert -
Short signal developing... stand by

 
 
  Jonathan Levinson   8/11/200,  10:57:28 AM
QQQ coming in for a test of 32.78. The shape of the short cycle upphase suggests that it will be cleared.

 
 
  Linda Piazza   8/11/200,  10:55:39 AM
The expected big announcement from Saudi about oil supply, being announced on CNBC and apparently expected at 11:30, may change this morning's tenor. We're also hearing troubling reports about potential supply problems from Yukos in Russia, so we may have battling sentiments going on here. I'd be careful in that environment.

The OEX appears to be widening its possible bear flag. If that's what it is, it probably should not retrace more than 50% of the drop from yesterday's high, so should probably not rise much above 525.50 before breaking down. Bulls would like to see the retracement stop at the 38.2% level, at about 524.80 if not below.

 
 
  Jeff Bailey   8/11/200,  10:52:09 AM
Biotech Index (BTK.X) 459.94 +1.04% .... and BIG biotechs lending some help to the QQQ.

 
 
  Jeff Bailey   8/11/200,  10:49:00 AM
GSTI Software Index (GSO.X) 128.42 -2.43% .... pinned at session low and just under QCharts' DAILY S2 (128.64), where WEEKLY S1 (126.50) in play for today at this point.

With SOX.X getting hammered, QQQ traders well served to monitor GSO.X pivots today.

QQQ $32.64 -1.71% and at its DAILY S2 ($32.65) here.

 
 
  Jonathan Levinson   8/11/200,  10:42:29 AM
Session high for ZN bonds at 112.2031, with TNX just entering negative territory, down .2 bps at 4.285%.

 
 
  Jonathan Levinson   8/11/200,  10:40:19 AM
The wavelet downphase is trying to end here, and it's doing so from a higher oscillator and price low on QQQ. That confirms a new short cycle upphase, Above 32.72, next resistance is 32.78 on the way to channel resistance at 32.85.

 
 
  Linda Piazza   8/11/200,  10:37:43 AM
So far, OEX bears got their wish, with the OEX pulling back after a test of the Keltner channel line currently at 523.64, leaving only a five-minute candle shadow above that line. However, bears would like to see the OEX drop below the channel line currently at 523, and that isn't happening. The OEX instead continues to test Keltner resistance.

 
 
  Jeff Bailey   8/11/200,  10:34:58 AM
Biotechnology Index (BTK.X) 457.10 +0.42% .... GILD $65.26 +2.01%, AMGN $54.91 +1.87%, BIIB $57.60 +1.39%, MLNM $10.41 +1.46%

 
 
  Jeff Bailey   8/11/200,  10:34:19 AM
QQQ daily interval chart with WEEKLY/MONTHLY Pivot retracement at this Link

 
 
  Jonathan Levinson   8/11/200,  10:33:26 AM
Current 30 min channel support is down to 32.50, resistance 32.88 QQQ.

 
 
  Jonathan Levinson   8/11/200,  10:32:33 AM
Nymex crude is bouncing, currently down .125 at 44.40, ditto gold down 5.20 at 397.10. The session low was 395.

 
 
  Mark Davis   8/11/200,  10:30:15 AM
It's very tempting to short right here but since this is the first chance I have a feeling we may get one more poke higher. If we just missed it then so be it... we already have a very nice play going with the SPX Sept 1050 puts.

 
 
  Linda Piazza   8/11/200,  10:25:23 AM
The OEX has now risen to test the next Keltner resistance, with that resistance sliding lower to 523.63-523.80. Above that is resistance near 524.50, but stronger resistance is above near 525.30. Bulls want to see the OEX above 523.80, but preferably above 524.50 and maintaining values above that level. Bears want to see the OEX turned back by 523.80-524.00 resistance.

 
 
  Jonathan Levinson   8/11/200,  10:23:00 AM
QQQ is taking its first wavelet bounce of the day. If it can hold for between 5 and 10 minutes, the short cycle will confirm a new upphase to follow it. The wavelet oscillator is just reaching overbought here, so if there's any strength for QQQ, this is where it needs to start.

 
 
  Mark Davis   8/11/200,  10:17:55 AM
Potential Day Trade Setup Alert -
If the opportunity presents itself we will be entering a short play using SPQTL (SPX Aug 1060 put), and I'd like to do it from the SPX 1069-1070 level.

 
 
  Jeff Bailey   8/11/200,  10:14:36 AM
10:00 Internals at this Link

Volume heavy this morning.

 
 
  Jim Brown   8/11/200,  10:13:10 AM
The JOLTS data fell to 5.9% in June from 14% in May. This shows that employment is still rising only at a slower level. Job openings fell to 3.029 million from 3.105 million. 4.329 million workers were hired and 4.052 million were seperated from employment. (fired, quit, laid off, retired, etc)

This data is still positive although less bullish than the prior month. Employment is still rising but only slightly.

 
 
  Jonathan Levinson   8/11/200,  10:10:55 AM
QQQ 100-tick 2-day chart at this Link.

 
 
  Linda Piazza   8/11/200,  10:10:30 AM
The SOX has now dropped below the 50% retracement of the rally off the Fall, 2002 low. That's a bad sign, if the SOX does not pull itself up above that level and leave only a candle shadow below it.

 
 
  Mark Davis   8/11/200,  10:09:34 AM
I'm feeling very comfortable this morning holding the SPQUJ (SPX Sept 1050 put)... we have purchased plenty of TIME so we can just sit back and watch this play out from the safety of the bleachers. I don't want to raise our stop until I see how far the first real rally attempt goes.

 
 
  Linda Piazza   8/11/200,  10:08:55 AM
European bourses steepen their declines.

 
 
  Jonathan Levinson   8/11/200,  10:07:42 AM
Session low for Dec e-mini gold at 395. HUI is down 1.61% and XAU is down 2.24%.

 
 
  Linda Piazza   8/11/200,  10:06:35 AM
And there's the OEX dive toward the 522.30-ish level, with the low so far at 522.40. Five-minute support has now dropped to just over 522, and resistance up near 525 continues to firm, with closer resistance trying to firm near 524.

 
 
  Jonathan Levinson   8/11/200,  10:05:22 AM
Session low fro Nymex crude, down .225 to 44.30.

 
 
  Jonathan Levinson   8/11/200,  10:04:56 AM
The Fed's open market desk has announced that it's taking no action today, which results in a net 4.75B drain. More austerity from the Fed.

 
 
  Jeff Bailey   8/11/200,  10:03:20 AM
10:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/11/200,  10:01:18 AM
The steep angle of decline has the 30 min channel bottm down to 32.72 here, falling almost vertically to catch up to the downside gapper in price. Bulls very much want to see some signs of life out of the soon-to-be-trending short cycle- it should provide support, and that support would help run the clock against the ongoing 30 min cycle downphase. If price continues to decline and the short cycle trends in oversold, then there's going to be more technical damage and the following 30 min cycle upphase will have more ground to try to recover. New lows are printing as I type- so far no sign of short cycle support.

 
 
  Linda Piazza   8/11/200,  10:00:15 AM
OEX 524-524.30 should now be resistance, but let's see if it holds.

 
 
  Linda Piazza   8/11/200,  9:59:28 AM
The TRAN rose yesterday afternoon to close just beneath its 30-minute 100/130-ema's. It opened today on the 30-minute 100-ema and fell from there. It's fallen beneath support at 3012-3014, but of course, the 3000 number is important, too, and the TRAN approaches that, with the TRAN currently at 3013.13. If the TRAN should bounce, a bounce that may have already begun, but stall again in the 3020-3025 area, watch for the possibility of a H&S being produced at the top of the climb off Monday's low. For the very short-term, this tells me that it's possible that the TRAN could bounce slightly beginning from anywhere between the current day's low and 3000, and could then spend several hours steadying near 3020-3025 before rounding down or else breaking above the shoulder area. The TRAN sometimes has a habit of doing away with the whole right-shoulder thing, though, and just going ahead and diving without bothering to produce that shoulder.

 
 
  Mark Davis   8/11/200,  9:57:43 AM
Stepping away for a few minutes...

 
 
  Mark Davis   8/11/200,  9:53:32 AM
I'm not inclined to try any scalp long plays today with sentiment so negative. If anything I may short any attempted rallies with current month (Aug) SPX puts. As always, I reserve the right to change my mind on a moment's notice (grin)

 
 
  Linda Piazza   8/11/200,  9:53:05 AM
The OEX may be losing its bid to bounce from the trendline off Friday's low, and may therefore be setting a possible downside target near 522.30. If it tries to rise now, it faces that trendline's resistance as well as newly gathering Keltner resistance near 524.30. QCharts is running WAAAY behind, so be careful.

 
 
  Jonathan Levinson   8/11/200,  9:51:44 AM
QQQ 2-day 100-tick update at this Link.

 
 
  Jonathan Levinson   8/11/200,  9:49:47 AM
It's been a long 28 minutes, but the Qubes are down less than 15 cents since the prior to the cash open, and short cycle has grown very oversold. A wavelet bounce is trying to form, and I continue to expect some kind of bounce to bring the price a little closer to the descending 30 min channel supports above.

 
 
  Mark Davis   8/11/200,  9:49:17 AM
Day Trade Exit Point Alert -
Raise your stops on SPQUJ (SPX Sept 1050 put) to 12.80 and break even.

Our SPX Sept 1050 puts are looking very nice this morning, currently printing 14.10/15.50, +14.84%, and it will take quite a spike to stop us out.

 
 
  Linda Piazza   8/11/200,  9:48:10 AM
The OEX is still trying to steady at that trendline off Friday's low. If it does, it faces first resistance at 524.57, but first gathering resistance from 525.55-525.98, and that could be firming up enough to stop the OEX's rise. We'll have to see. Wish we knew what the TRIN really measured.

 
 
  Jonathan Levinson   8/11/200,  9:46:35 AM
I'm seeing the NYSE TRIN at 1.28 and the TRINQ at 2.87 according to Scottrade's realtime index feed.

 
 
  Linda Piazza   8/11/200,  9:45:13 AM
I'm working on three-minute old information as Q-charts has quit producing candles, but the OEX had been trying to steady at that ascending trendline off Friday's low, but now appears to be dropping just below it. If it continues this drop, perhaps by dropping below yesterday's last five-minute low of 523.78, it's setting up a possible test of the 522.30 level. Be cautious here whether you're bullish or bearish about the day's likely direction.

 
 
  Jeff Bailey   8/11/200,  9:44:35 AM
Current OPEN MM Profiles at this Link

 
 
  Mark Davis   8/11/200,  9:43:31 AM
Jane that is sooooo weird... my Schwab feed is showing TRIN @ .87 and StockCharts shows it @ 1.45. I wish this TRIN issue would get squared away. How can we trust it when the readings are all over the map?

 
 
  Jonathan Levinson   8/11/200,  9:42:44 AM
Session lows for the Naz and Russell2K futures here. QQQ continues to sink lower below the 30 and 60 min cycle channels, with the shorrt cycle oscillators oversold.

 
 
  Mark Davis   8/11/200,  9:40:37 AM
I'm expecting the May and July lows to be pretty strong resistance (SPX 1076-1078), if we even get back up there. Right now those numbers seem a long ways away.

 
 
  Jonathan Levinson   8/11/200,  9:33:02 AM
Sept silver is down a whopping 22 cents or 3.27% at 6.505, session low here.

 
 
  Linda Piazza   8/11/200,  9:32:58 AM
At just over 524, the OEX hits the ascending trendline off Friday's low, a point that might provide support and allow for a retest of broken support.

 
 
  Jonathan Levinson   8/11/200,  9:32:11 AM
Session low for QQQ here at 32.78, NQ futures at 1319.

 
 
  Jonathan Levinson   8/11/200,  9:30:18 AM
Session low for Dec gold, down 6.30 at 396.

 
 
  Linda Piazza   8/11/200,  9:29:12 AM
If cash markets open as futures predict they will--they don't always--the OEX may well open at or below the 15-minute 100/130-ema's, at 527.37 and 528.39, as well as beneath the 38.2% retracement of the decline that started 8/04. The smallest Keltner channels are pointed up on both the 5- and 15-minute Keltner charts. It will take a sustained trade below 527.49 on the five-minute chart to flatten that channel and a sustained trade below 526.72 to turn it lower again. A sustained trade below that second figure will also accomplish the flattening of the smallest channel on the 15-minute chart. Unless the OEX either opens below those numbers and stays below them, or else dives below them and stays below them, that channel will stay pointed up and will suggest another test of resistance. The behavior of the futures in the overnight session--not rising appreciably when the Asian markets did, and dropping further when the European markets dropped--suggests vulnerability to the downside rather than strength, however, so at this point, in the absence of other clues that we'll get when the markets open, I would expect that any retest of the resistance would fail. Depending on where the markets open, we may not even get that retest. Because the OEX is still near weekly historical and Keltner support, I still suggest caution with positions and efforts made to protect any profits gained.

 
 
  Jonathan Levinson   8/11/200,  9:28:28 AM
More bad news from Russia: Link

Russia's Central Bank recalled Dialog-Optim Bank’s license on Tuesday, August 11, citing the bank’s faulty financial reports and its inability to pay back debt as the reasons for its actions in its press release. CBR has appointed its own provisional administration over the bank in accordance with Russia’s bankruptcy laws.

 
 
  Mark Davis   8/11/200,  9:20:13 AM
LOL Keene... I think you hit the nail on the head! I just wish we had the necessary capital to do it to them, however, there are many more mice than fatcats so we must be doing something right.

 
 
  Mark Davis   8/11/200,  9:17:17 AM
Pre-Market trading...

CSCO 18.65, -8.85%
DELL 33.66, -1.92%
EBAY 74.85, -1.18%
GE 31.90, -0.59%
INTC 22.15, -1.73%
IWM 104.34, -0.65%
MSFT 27.39, -1.19%
NSM 14.40, -8.28%
QQQ 32.84, -1.11%
SMH 29.85, -3.27%
YHOO 22.65, -2.21%

With these kinds of numbers coming out of the bellweathers it will be difficult for the markets to do anything but go down in early trading.

 
 
  Jonathan Levinson   8/11/200,  9:11:18 AM
The CSCO skid came just following the peak of the 30 min cycle for QQQ, and looking at the Naz futures charts this morning, I see a 30 min cycle downphase underway with plenty of room to run. That said, the opening gap below 30 min channel support of 33.10 suggests that the short cycle bias will be to the upside within the descending 30 min cycle. In other words, the immediate drop has gotten ahead of the cycles, and support should continue to assert itself above 32.80. If price continues to hold at these lows, the 30 min channel will chase downward to catch up with price, but it's exceedingly rare that the price can hold below 30 and 60 min channel support for longer than a few minutes during the cash session. In any event, given the 30 min cycle downphase, any bounce should be sideways or, if up, fail at a lower high, in this case below 33.45, and the most important technical test will be whether Friday's low holds. If it does, then bulls have reason to hope for an upside daily cycle whipsaw. If it fails, then the weekly cycle downphase is dominant, and bulls will be in for more pain below Friday's low.

 
 
  Keene Little   8/11/200,  9:11:04 AM
Mark, ain't that the truth! We've all been stumped for a long time about how many "perfect" setups fail. Many times I wonder if it isn't as simple as the big guys knowing all us little guys are watching the same setups and they get a big chuckle in the back room as they run the prices to complete the setup, suck us all in, and then gleefully run price the other way, cashing in on all the stops that are immediately clicking away. Bad people, bad people.

It's why I've become much less trusting of any signal and I take my small piece of cheese hoping nobody sees me, and scurry back into my hole to enjoy my little morsel. I'm in that mode this morning.

 
 
  Mark Davis   8/11/200,  9:04:16 AM
Good Morning Keene... I don't envy your position as the EW expert here at OI. EW patterns have a nasty habit of morphing into something entirely different and the EW analysts seem to catch the brunt of the criticism. In your defense I would point out that "regular" TA patterns do exactly the same thing on a regular basis. How many times have we seen H&S, inverse H&S, bearish wedges, triangles, etc. confirm, only to reverse and invalidate a few minutes later? We call them "headfakes" or "failures", as if it were not the fault of traditional TA (grin), but in fact it's just "morphing" with a different name. The only sure thing in technical analysis is that there is no sure thing.

 
 
  Mark Davis   8/11/200,  8:42:22 AM
Good Morning... today seems to be virus day. I woke up to no less than 12 viruses in my mailbox this morning. Somehow they got through all my firewalls, Spybot, Ad-aware, Spyware Blaster, Norton Anti-Spam and Norton Anti-Virus. These guys are getting better all the time and you don't even have to open the emails. Fortunately I have software that creates image files of my C: drive, and I save an image file daily, so it's a simple matter of going back and retrieving yesterday's file (pre-infection) and I'm back up clean as a whistle in about 10 minutes. If I go down for a while today that will be the reason.

 
 
  Jonathan Levinson   8/11/200,  7:49:22 AM
Equities are lower, with ES down 5.50 at 1070.75, NQ -13 at 1323.5, YM down 44 at 9873 and QQQ -.31 at 32.88. Gold is down 3.40 to 398.90, silver -.097 to 6.628, bonds down .109 to 112.016, and crude oil up .075 to 44.60.

We await the 2PM release of July's treasury budget, est. -60.5B.

 
 
  Linda Piazza   8/11/200,  6:50:55 AM
Good morning. Yesterday, a Bank of Japan statement mentioned the impact of crude prices, but also mentioned signs that the economy was continuing to recover. The Nikkei opened almost 100 points in the green, above 11,000. After dipping back to 11,000 to confirm that level as support, the Nikkei climbed again, but then traded in an increasingly narrow range the rest of the day, closing almost exactly on its opening value. It closed up 95.91 points or 0.88%, at 11,049.46. That action will create a doji at the top of the climb off Monday's low.

Exporters and banks gained. Stocks in the news included UFJ Holdings, Mitsubishi Tokyo Financial and Sumitomo Mitsui Financial, with UFJ and Mitsubishi making plans to conclude their on-again, off-again merger agreement by the end of this month. This occurred after UFJ Holding's appeal to the high court resulted in a reversal of a lower-court injunction against the merger. UFJ gained 5.2% and Mitsubishi Tokyo, 6.9%. Sumitomo Mitsui, the company originally seeking the injunction, had also made a bid for UFJ.

Other Asian markets were mixed, but many tech stocks traded higher in the region. The Taiwan Weighted lost 0.49%, but South Korea's Kospi gained 0.59%. Singapore's Straits Times lost 0.27%, and Hong Kong's Hang Seng lost 0.52%. China's Shanghai Composite lost 1.13%.

Currently, European bourses mostly trade lower, with worries about the U.S. tech sector weighing more heavily than yesterday's post-Fed rally. Many tech stocks are losing ground in European trading, including chip stocks, some due to general tech weakness and some as a result of their earnings report or other news. Two stocks gaining in early trading were German Internet service provider T-Online, gaining strongly after beating expectations, and French IT services group Cap Gemini, gaining after reporting sales at the top of expectations. In the U.K., many blue chips trade lower. A hefty portion of the FTSE 100's slide has been attributed to the number of companies trading ex-dividend. The Bank of England noted Wednesday that the inflation target of 2% should be hit in about two years.

The FTSE 100 has lost 27.70 points or 0.64% at the time of this writing, to trade at 4,323.20. The CAC 40 has lost 19.83 points or 0.56%, to trade at 3,513.23. The DAX has lost 45.42 points or 1.22%, to trade at 3,675.22, again below the much-watched 3,680 level.

 
 
  Linda Piazza   8/10/200,  9:46:37 PM
Just before the close Tuesday, the OEX popped to the top resistance on the 5-minute Keltner charts, with that resistance at 528.50 and the OEX closing at 528.52. The move occurred so quickly that prices outstripped five-minute MACD, creating bearish divergence, but bearish divergence that can be erased with a continued climb by the MACD. In addition, the OEX popped above 15-minute Keltner resistance that had looked firm and the 38.2% retracement of the decline from the 8/04 high to the 8/06 low, with that retracement at about 528.30. The 50% retracement is at 530.57, within the 530-533 next resistance band. The OEX also ended the day in a test of the 15-minute 100/130-ema's, easing just above the 130-ema.

But did the OEX just overrun intended resistance on short-covering ahead of the CSCO earnings report? That's possible. As I'm preparing this report, I note that CSCO has been down more than 6%, but is currently down 5.18%. The QQQ's are down, as are the SPY's and DIA's, and the SMH. The short-covering into the close could get reversed tomorrow morning, bringing the OEX back below Keltner resistance and the 38.2% retracement of the decline since 8/04, as well as below those 15-minute averages. Of course, we all know not to put too much trust in after-hours developments.

If that weakness does not continue into tomorrow's open, a run toward next resistance remains possible. The BIX bounced from its 200-sma and closed above its 72-ema, an average that had supported it through its more-than-two-month consolidation until it fell through that support last Thursday. The TRAN also bounced from its near-touch of its 200-sma on Monday and then Tuesday completed a nice-looking, although not classic, morning-star reversal signal, also closing just above its 72-ema, an average that has some resonance for the TRAN, too. Each of those leading indices now approaches or has touched significant possible resistance, but the reversal signals they produced at support can't be denied, either. Even though the SOX's reversal came from possible significant support, the 50% retracement of the rally off the low from the fall of 2002, its signal was not as convincing, however, with the SOX not able to retrace more than 50% of Friday's drop.

Tomorrow, key first on the OEX's behavior with respect to the 15-minute 100/130-ema's, with those averages at 527.73 and 528.39, respectively. A rollover beneath them suggests that the OEX just overran yesterday's resistance, while a continued push above them suggests that we could see the test of 530-533, with the lower end of that zone marking the 50% retracement of the decline since 8/04.

 
 
  OI Technical Staff   8/10/200,  9:01:41 PM
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