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  Jeff Bailey   8/23/200,  5:14:53 PM
Pivot Matrix for tomorrow at this Link

 
 
  Jeff Bailey   8/23/200,  4:40:14 PM
Closing Internals at this Link

 
 
  Mark Davis   8/23/200,  4:24:40 PM
Recap of Monday's trades: Link

Note...
Since the new format is incompatible with the old (we're counting SPX points now rather than strike price points) I'm going to start the stats from the point we switched, i.e. we're down -2.12 SPX points for today. Nothing like starting out in the hole to get you motivated (grin)

 
 
  Mark Davis   8/23/200,  4:16:29 PM
I'll go for a "do over" too Jim

 
 
  Jeff Bailey   8/23/200,  4:07:14 PM
Current OPEN MM Profiles at this Link

Today's Activity ....

Day trade long Yahoo! Inc. (YHOO) at $28.81, closed out at $28.62. ($-0.19, or -0.66%).

 
 
  Jeff Bailey   8/23/200,  3:57:42 PM
Stillwater Mining (SWC) $14.27 -4.29% .... looks like it is going to close out right at Thursday's close and just above my 38.2% fitted retracement ($14.24).

Dollar Index (dx00y) 89.09 +1.10% (30-minute delayed) pretty close to MONTHLY Pivot. I'm feeling 50/50 on SWC right now.

 
 
  Mark Davis   8/23/200,  3:55:42 PM
Day Trade Exit Point Alert -
Stopped out... @ SPX 1095.78 and break even

 
 
  Jim Brown   8/23/200,  3:55:00 PM
Reuters reporting a sustained strike by aircraft in Iraq at targets around the Najaf Mosque.

 
 
  Linda Piazza   8/23/200,  3:54:38 PM
The OEX fell below the neckline of the continuation-form inverse H&S from last week, with the bounce from the day's low bringing the OEX up to retest the neckline. The OEX turned down from that retest. That effectively negates that inverse H&S that was confirmed Friday.

 
 
  Jonathan Levinson   8/23/200,  3:53:06 PM
The 30 minute cycle oscillators have rolled over again and are in a downphase below what I believe to be a rising wedge support line. A break below the session low of 33.91 is the first step required to confirm this bearishness, however. Link

 
 
  Linda Piazza   8/23/200,  3:51:59 PM
Next Keltner support for the OEX lies at 534.71.

 
 
  Jeff Bailey   8/23/200,  3:51:52 PM
Bullish day trade exit alert ... for Yahoo! Inc. (YHOO) $28.62 at the bid.

 
 
  Linda Piazza   8/23/200,  3:51:28 PM
The SOX tests 390 again, at 390.01 as I type.

 
 
  Linda Piazza   8/23/200,  3:44:08 PM
Bulls got their fast bounce, past part of the Keltner resistance that was trying to gather on the OEX's five-minute chart, but the bounce didn't bring the OEX past all of that resistance. Resistance gathers from 535.58-536, but now support is trying to gather near 534.66, too.

 
 
  Mark Davis   8/23/200,  3:43:03 PM
stepping away for a few minutes...

 
 
  Mark Davis   8/23/200,  3:41:53 PM
Day Trade Exit Point Alert -
Cinch up your stops... to SPX 1095.78 and break even
I don't like the looks of this (so far) wimpy bounce

 
 
  Linda Piazza   8/23/200,  3:34:43 PM
A lot of Keltner resistance is trying to converge near 535.60-536. Depends on how fast the OEX gets there whether it has time to converge, but bulls want to see the OEX bounce soon and bounce hard, to get past it first.

 
 
  Mark Davis   8/23/200,  3:33:39 PM
If SPX rolls over again from these levels it looks to me like it's vulnerable to 1092.50 before it finds some decent support.

 
 
  Jonathan Levinson   8/23/200,  3:33:08 PM
The short cycle downphase contunes, but the TRIX and Macd are getting very bottomy for QQQ and the 30 min cycle channel is only beginning to flatten for QQQ. This is so far only a choppy picture, and not a particularly bearish, especially given that the Qubes remain in positive territory. A drop below 33.90 is the first step for cautious QQQ bears to painting a negative picture of the current price action.

 
 
  Linda Piazza   8/23/200,  3:32:27 PM
In order to maintain a downside target of 533.25, the OEX needs 15-minute closes beneath a Keltner line currently at 535.86. Haven't I typed this already once or twice today? Tells you what kind of day it's been, doesn't it?

While it's been a chopped-up kind of day, however, it hasn't been a bullish day, on the OEX or some other indices. We did see the limited upside on the OEX. We did see the TRAN test and then fall back from key levels.

 
 
  Mark Davis   8/23/200,  3:30:39 PM
Day Trade Entry Point Alert -
Go long now... SPX @ 1095.78, stop 1094.50

 
 
  Jonathan Levinson   8/23/200,  3:30:11 PM
Euro futures continue to get sold, now down 1.38%. Gold is down 4.20 at 411.20, silver -2.26% and HUI -2.48%. So far the dollar strength is bearish for oil, metals, bonds, and to a lesser extent, equities as well.

 
 
  Jonathan Levinson   8/23/200,  3:19:51 PM
QQQ and NQ remain the strongest of their peers, still fractionally positive against the losses being led by the Dow futures. QQQ channel support remains firm at 33.96. A break below 33.90 will change that, but so far the violume isn't strong enough over all to alter the tick-chart signals in place even half an hour ago.

 
 
  Linda Piazza   8/23/200,  3:15:04 PM
The OEX needs a quick bounce, or else it's produced a breakout signal on the five-minute Keltner charts, breaking down below one channel and setting up a downside target at the next channel's lower support. That lower support is at 532.94 currently. The OEX attempts to bounce, but will find resistance just above at 535.14, and then gathering again at 535.64-535.76.

 
 
  Jeff Bailey   8/23/200,  3:13:29 PM
TRIN 1.00.

 
 
  Linda Piazza   8/23/200,  3:12:43 PM
The BIX turns down again. Here's where it is with respect to that megaphone shape, also known as an orthodox broadening formation: Link

 
 
  Linda Piazza   8/23/200,  3:09:46 PM
The TRAN has served well as an indicator index today. If you read the Wrap that I wrote when substituting for Jim this weekend--Aren't we all glad he's back?--you know that I suggested watching the TRAN this morning for a punch up above 3100 and the top of the descending trendline off the 7/01 high, to see how the TRAN behaved at that test. The TRAN was the closest to breaking out of its descending regression channel to the upside, and has served well as an indicator index for us lately. I thought the result of that test might show us about strength or weakness in the markets, and the TRAN got slapped right down again. Now it deepens its decline, about to test the 30-dma and below the 50-dma. However, the TRAN is just dropping inside the congestion zone from the last week, so it's possible that it could find support anywhere within that zone. For now, however, the day's trading pattern has been anything but bullish.

 
 
  Jeff Bailey   8/23/200,  3:09:16 PM
Bullish day trade raise stop alert ... for Yahoo! Inc. (YHOO) $28.75 +0.48% .... to $28.60.

 
 
  Jonathan Levinson   8/23/200,  3:08:57 PM
QQQ held 34.08 support on that try even as ES and YM broke to new lows. Retesting it here as I type. 30 min channel support remains 33.97.

 
 
  Mark Davis   8/23/200,  3:07:33 PM
Day Trade Exit Point Alert -
Stopped out... SPX 1096.68, -2.12 pts

 
 
  Jeff Bailey   8/23/200,  3:06:42 PM
03:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/23/200,  3:06:05 PM
The cash bond market has just closed, with TNX up 4.8 bps or 1.13% for the day.

 
 
  Linda Piazza   8/23/200,  3:05:56 PM
The OEX is falling below the mid-channel level on the five-minute Keltner charts, and hitting possible next support on the 15-minute ones. Those charts show that 535.23 or so may be a bounce point for the OEX, a level we already know from historical support over the last couple of days. Coincidentally, the OEX is also hitting the neckline of the inverse H&S on the 15-minute chart that it confirmed on Friday. That means that this could all just have been a retest of broken resistance to see if it now holds as support. If the OEX doesn't pull it together at that 535-535.25 support, it may be vulnerable down to 533.40 or so.

 
 
  Jonathan Levinson   8/23/200,  3:05:38 PM
Session lows for Dow and SPX futures here.

 
 
  Jonathan Levinson   8/23/200,  3:04:20 PM
Updated QQQ chart at this Link showing the first signs of trouble for the current short cycle upphase. It still looks like a break below 34.08 will kick off a new downphase- I'd want to see that level hold for at least 5 minutes, however, given how whippy and aimless the moves have been today. Volume is very light- just 67M QQQ shares traded so far today according to my IB feed.

 
 
  Mark Davis   8/23/200,  3:00:08 PM
Day Trade Exit Point Alert -
Lower your stops... SPX 1096.68
1-min CCI just printed -360... the last time we got a similar reading at 1:16 it resulted in a +4 point move

 
 
  Mark Davis   8/23/200,  2:57:23 PM
Here comes the move... in the wrong direction (for our long play)

 
 
  Mark Davis   8/23/200,  2:56:14 PM
SPX b-bands are getting pinched VERY tight... we should get a move here pretty soon

 
 
  Mark Davis   8/23/200,  2:53:40 PM
Day Trade Entry Point Alert -
Go long now... SPX @ 1098.80, stop 1097.50

 
 
  Jonathan Levinson   8/23/200,  2:50:56 PM
Nymex October oil has closed at 46.10, down 3.25% or 1.55. Link

 
 
  Jeff Bailey   8/23/200,  2:49:29 PM
October Oil futures (cl04v) 46.03 -1.47% ... correlative to dollar and session lows.

 
 
  Jeff Bailey   8/23/200,  2:48:20 PM
U.S. Dollar Index (dx00y) 89.08 +1.08% .... session high and MONTHLY Pivot.

 
 
  Jeff Bailey   8/23/200,  2:44:25 PM
Oct. Oil futures (cl04v) $46.10 -1.32% (30-min delayed) .... 60-minute interval chart with WEEKLY pivot levels at this Link

 
 
  Linda Piazza   8/23/200,  2:42:38 PM
Next OEX Keltner support below the current level appears to be in the 535.40-535.60 range.

 
 
  Jonathan Levinson   8/23/200,  2:42:29 PM
This weakness is so far registering only on the wavelet oscillators within the ongoing short cycle upphase. A break below 34.08 will start a new short cycle downphase, however. Volume is once again very light following the initial sell candle at the day high.

 
 
  James Brown   8/23/200,  2:35:34 PM
Fedex (FDX) is trading higher today up more than 3% to $81.68 on stronger than average volume. This morning the company raised its outlook for the current quarter and the year claiming business is good for its international, ground delivery and less-than truckload services (-AP). FDX has raised its quarterly earnings estimates from $0.90-$1.00 to $1.00-1.10.

 
 
  Jeff Bailey   8/23/200,  2:33:53 PM
Current OPEN MM Profiles at this Link

 
 
  James Brown   8/23/200,  2:31:05 PM
Winemaker Robert Mondavi Corp (MOND) is up more than 10.5% to $41.10 after Prudential upgraded the stock from "neutral" to "over weight". Volume more than 10 times the average with the stock trading to new 2 1/2 year highs this morning.

 
 
  Jonathan Levinson   8/23/200,  2:29:41 PM
This move above 34.20 finally whipsawed the 30 min QQQ cycle to the upside, from a much higher price and oscillator low. 30 min QQQ chart at this Link.

 
 
  James Brown   8/23/200,  2:28:33 PM
AT&T (T) is announcing it will sell its "CallAdvantage" VoIP service in Best Buy stores (BBY). Neither stock is moving on the news.

 
 
  Linda Piazza   8/23/200,  2:27:36 PM
The Russell 2000 still trades below its 200-ema, having pierced it earlier today before pulling back.

As I scan the indices, I see a mixed picture, with the SOX appearing to lead the charge higher, but the TRAN showing a troubling tendency to pull back, troubling since it's been a bellwether index lately, too.

 
 
  Mark Davis   8/23/200,  2:27:25 PM
Day Trade Exit Point Alert -
Stopped out... SPQUR (SPX Sept 1090 put) @ 12.50 and break even
We were stopped out of our short play while I was composing that rather lengthy post.

 
 
  James Brown   8/23/200,  2:26:51 PM
Boston Scientific (BSX) is up more than 2% after announcing that the FDA has approved its FilterWire EZ Embolic protection system.

An excerpt from the Associated Press article:
"...the device acts as a filter during procedures when surgeons clear a saphenous vein graft with an angioplasty balloon or prop it open with a stent. Saphenous veins, which are located in the leg, are transplanted by surgeons for use as replacement vessels during heart bypass surgery. The device, which uses a guidewire and is placed downstream of the procedure, traps material that is dislodged during angioplasty and stenting procedures to prevent it from traveling to tiny vessels in the heart and producing a heart attack."

 
 
  Linda Piazza   8/23/200,  2:25:44 PM
But the SOX is building on last week's gains, breaking out of the small bull flag on its daily chart and breaking above 390.

 
 
  Linda Piazza   8/23/200,  2:24:42 PM
The BIX is also not making great strides at building on last week's gains, printing a perfect doji today, so far.

 
 
  Jonathan Levinson   8/23/200,  2:23:52 PM
Former resistance is now support at QQQ 34.20. Testing it now.

 
 
  James Brown   8/23/200,  2:23:28 PM
FYI:

Great Lakes Chemical (GLK) has upped its antioxidant prices by 10% worldwide. (these are chemical antioxidants not the kind in your daily vitamins)

 
 
  Linda Piazza   8/23/200,  2:23:24 PM
TRAN still dipping.

 
 
  Jane Fox   8/23/200,  2:22:45 PM
Mark or just trade the futures and you don't have to worry about all that. (14:18 post) (big grin)

 
 
  James Brown   8/23/200,  2:19:26 PM
Dow-component Pfizer (PFE) is up slightly on news that the FDA has approved its Geodon drug treatment for acute bipolar mania.

 
 
  Mark Davis   8/23/200,  2:18:50 PM
*** Note to readers
Due to confusion related to entry/exit prices on some of our recent plays I'll be changing the format of future plays.
The old format for entry/exit was... "Go short now... SPQUR (SPX Sept 1090 put) @ 12.50, stop 11.50"
The new format for entry/exit will be... "Go short now... SPX 1100.20, stop 1098.20"
After issuing a buy or sell signal I will wait until it posts on the Market Monitor and then adjust the entry/exit price to whatever SPX is printing at the time the trade posted on the Monitor. We will keep track of gains/losses with +/- SPX Index points. This will eliminate any confusion as to what the entry/exit point was and will also free you to pick the strike price of your own choice.

I would caution readers on a couple of points...
1) Keep an eye on what Market/Futures Monitor writers are saying re: support/resistance levels and pick a realistic strike price. In most cases this will mean picking a strike price that is within 5-10 points of current levels on SPX. Swinging for the fences with way Out of The Money (OTM) contracts usually results in striking out. If SPX exceeds your target price that's great... you'll still make lots of money.
2) Try to split the bid if possible. Example: If the spread is 12.00/13.60 that's a difference of 1.60. Make an offer that gives the Market Maker the fatter portion of the spread, i.e. 13.00. In most cases he will take it. In a fast moving market you may not be able to do this but I urge you not to just pay what they are asking or take what they are offering.
3) Be careful to identify the "true spread", which can be difficult at times. The above example was taken from earlier quotes on SPQUR (SPX Sept 1090 put). At one point the spread showing was 12.10/12.90 when I knew the true spread was 12.00/13.60. If you entered a bid for 12.60, thinking you were splitting the bid, your order would just sit there because you'd be trying to buy the contract for about 40 cents less than what the Market Maker would need to make a fair profit. The skewed bid/ask in the above example occurred because somebody was trying to sell the contract for 12.10 and somebody else was trying to buy it for 12.90. The spread always shows the best bid/ask prices... even if they are unrealistic and have no hope of being filled they show up because the order has been placed. If you believe the spread is skewed, try looking at strike prices just above and below yours to see if you can get a more realistic idea of what the true spread is.

 
 
  Linda Piazza   8/23/200,  2:17:30 PM
Bulls need to be just as careful as bears. Although some other indices are bouncing, the TRAN is not. It's at 3081.79, still minimally below the 50-dma at 3085.39, with that average having supported the TRAN earlier.

 
 
  Jonathan Levinson   8/23/200,  2:17:25 PM
Session low for Nymex crude here at 46.05, -3.36%.

 
 
  Jonathan Levinson   8/23/200,  2:15:39 PM
The short cycle oscillators have resolved their chop to the upside and project to a test of rising 30 min channel resistance at 34.33 for starters. I expect that level to climb higher, and 34.00-34.44 is the next likely confluence resistance.

 
 
  Jeff Bailey   8/23/200,  2:14:46 PM
Day trade long alert .... Yahoo Inc. (YHOO) $28.81 here, stop $28.50, target $29.41.

 
 
  Jonathan Levinson   8/23/200,  2:12:53 PM
QQQ updated chart at this Link . Nymex crude is down 1.425 at 46.225, -2.99%.

 
 
  Linda Piazza   8/23/200,  2:09:30 PM
The OEX now hits resistance on the 15-minute Keltner chart. If this resistance holds and the OEX has 15-minute closes beneath the Keltner line currently at 537.37, the OEX will be preserving the picture of bearish divergence, Keltner style, on the 15-minute chart. Meanwhile, the 15-minute MACD tries to turn higher again. If that resistance doesn't hold, the next resistance will be encountered at a Keltner line now at 538.11 on that chart.

 
 
  Jeff Bailey   8/23/200,  2:04:47 PM
Buy Program Premium .... SPX 1,100.38 , QQQ $34.21

 
 
  Jeff Bailey   8/23/200,  2:02:52 PM
02:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/23/200,  2:02:23 PM
Session low for Euro futures here, down 1.02% at 1.2177.

 
 
  Jonathan Levinson   8/23/200,  1:58:40 PM
Here's an upside break with a new session high for QQQ. Testing 34.22 resistance.

 
 
  Linda Piazza   8/23/200,  1:58:27 PM
It pays to be leery of bearish chart developments when Jonathan mentions a big addition in overnight money from the Fed's open desk, as he did in his 9:53 post this morning. We tend to see sudden bounces like this just when a bearish formation (inverted bowl or saucer in the case of the OEX) appears to be on the verge of confirming or sometimes just after it has. Of course, the OEX had just reached the mid-channel level, and Keltner charts had been suggesting a bounce unless the OEX dipped quickly beneath 535, so maybe this was just based on technicals that others can read as well as or better than I can?

 
 
  Jonathan Levinson   8/23/200,  1:54:05 PM
WASHINGTON (CBS.MW) -- The U.S. economy is not in "jeopardy" from higher oil prices, according to Robert McTeer, the president of the Federal Reserve Bank of Dallas. The economic recovery is "in a soft spot right now, and I wish it would strengthen, but I don't think it's in jeopardy," McTeer said in a television interview with CNBC cable channel. He said that higher oil prices are "troublesome" by adding to price pressures and slowing growth. But he said oil prices were not high when adjusted for inflation.

 
 
  Jonathan Levinson   8/23/200,  1:52:34 PM
The bounce just now sets up what appears to be a neutral pennant: Link . My thinking is that this continuation pattern should break to the upside. But a break of either support or resistance line on volume should set up a directional move. We can hope, anyway.

 
 
  Linda Piazza   8/23/200,  1:52:23 PM
We're right in the stop-running time of day, which makes any sudden run-up or any sudden dip suspect. So far, this run-up isn't getting slapped right back down, however. If it doesn't, soon, then the big girls and boys know what they need to know and will attempt to send markets higher again.

 
 
  Jeff Bailey   8/23/200,  1:38:17 PM
Bullish day trade setup cancel alert .... Cancel bullish entry ($45.90) for Adobe Systems (ADBE) $45.60 -1.06% ....

 
 
  Linda Piazza   8/23/200,  1:31:57 PM
The OEX is balancing on the mid-channel level on that five-minute chart. It did get at least a short-term pop higher (lasting all of five minutes, so far), but found resistance at the first Keltner line it encountered. Bears need to see the OEX push below 535, however, or it might see more of a bounce. Keltner resistance lines are beginning to separate on the five-minute chart, and if the OEX doesn't dip soon, it might be able to get through those separating Keltner lines. If the OEX does bounce, watch that inverted saucer or bowl shape from the chart linked to my 13:27 post. Bears would want to see the OEX maintain that shape, while bulls would want to see it push above the curve of the bowl or saucer.

 
 
  Jonathan Levinson   8/23/200,  1:30:33 PM
100-tick 2-day QQQ update at this Link.

 
 
  Linda Piazza   8/23/200,  1:27:02 PM
Here's an inverted saucer or bowl shape on the OEX's five-minute chart: Link

 
 
  Jonathan Levinson   8/23/200,  1:22:05 PM
Here comes the volume now. QQQ 34.05.

 
 
  Mark Davis   8/23/200,  1:19:57 PM
stepping away for a few minutes...

 
 
  Linda Piazza   8/23/200,  1:19:05 PM
I was just about to type a note saying that this OEX decline wasn't acting like the typical decline after a third trendline break a la the correlative-fan theory when the decline decided to act just as it should. Mid-channel support is now being tested. That should be good for a reflexive pop, but the OEX will then face gathering resistance near 536. It would need to have 15-minute closes above the Keltner line now at 536.09 to turn the smallest channel on the 15-minute chart higher, and the condition is similar for the five-minute chart.

 
 
  Jonathan Levinson   8/23/200,  1:18:37 PM
I'm dubious of this break- there was no uptick in volume to confirm it.

 
 
  Jeff Bailey   8/23/200,  1:16:54 PM
Sell Program Premium SPX 1,096.92 ....

 
 
  Jonathan Levinson   8/23/200,  1:16:38 PM
QQQ is ticking below the 7200-tick SMA as I type, the first time since 10AM.

 
 
  Jonathan Levinson   8/23/200,  1:15:16 PM
The 30 min cycle downphase never ended for QQQ, but it's generating pathetic price traction. I expect the next 30 minute cycle upphase to be a doozy if this is the best that bears can do with an overbought 30 min downphase. That said, there still appear to be several hours left before this downphase will reach oversold, so there's still room for bears to do their thing. However, for the past two weeks, almost every 30 min downphase has bottomed around the midpoint of its range, never reaching oversold territory. A break below 33.90 or above 34.20 should be directional.

 
 
  Jonathan Levinson   8/23/200,  1:10:29 PM
CRAWFORD, Texas, Aug 23 (Reuters) - Russian President Vladimir Putin told U.S. President George W. Bush on Monday that Russian oil companies were boosting production as well as exports and would continue to do so.

"President Putin noted Russian oil companies are increasing production and exports and will continue to do so," White House spokesman Scott McClellan told reporters at the president's Texas ranch.

Nymex crude currenrly -1.05 or -2.15% at 46.60.

 
 
  Jeff Bailey   8/23/200,  1:04:05 PM
01:00 Internals at this Link

 
 
  Linda Piazza   8/23/200,  1:01:50 PM
The OEX again looks vulnerable to the mid-channel level on the five-minute chart, but that mid-channel level has been climbing all day while the OEX alternately appears to head down toward it and then swings up again. The mid-channel level is currently 535.33. If the OEX should break through that level and sustain five-minute closes below that level, it has vulnerability down to a Keltner line currently at 532.89, but that hasn't happened yet.

 
 
  Jonathan Levinson   8/23/200,  1:01:23 PM
Still very light volume as QQQ drifts back below the 34.10 level. Price is currently testing the rising 7200-tick SMA at 34.08. The 30 min channel remains flat, but will rollover on a break below 34.05.

 
 
  Linda Piazza   8/23/200,  12:57:40 PM
By the way, the correlative-fan theory works with declines, too. The first trendine formed during decline is usually too steep to be maintained, etc.

 
 
  Jim Brown   8/23/200,  12:57:23 PM
Just hitting the wires: Russian president Putin says Russia will increase exports to help with prices

 
 
  Linda Piazza   8/23/200,  12:55:16 PM
The correlative-fan theory doesn't always work, but here's what I'm watching today with respect to that theory: Link To review, that theory says the first rally (or decline) usually forms a too-steep-to-maintain trendline that's broken. A second trendline is formed, but it's often too steep to maintain, too, and it's broken, forming a third trendline. It's upon the break of that trendline that the trend has changed. Note: It's being broken as I type.

 
 
  Jeff Bailey   8/23/200,  12:55:15 PM
01:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/23/200,  12:52:45 PM
Gold is flatlined just above 412 support, currently down 3 at 412.40. This would look like a run-of-the-mill bullish retracement of part of last week's substantial gains were it not for the toppiness in the 10-day stochastic discussed in the weekend Futures Wrap. The TNX is down from its intraday highs but still up 5 bps or 1.18% for the day. I expect a rising TNX to continue to have a deleterious effect on gold and silver prices, at least so long as the daily cycles on these assets remain in sync.

 
 
  James Brown   8/23/200,  12:51:26 PM
Here's a breakdown for anyone following the Google process. There is a lot of stock coming for sale in the very near future. 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

Total new shares going into the market = 265 million

Their initial IPO last week was for only 25 million shares.

 
 
  Jim Brown   8/23/200,  12:48:28 PM
With the amount of GOOG stock coming to the market over the next three months Abbe had better sell quickly or that investment could be substantially less. James posted a breakdown of the lockup release dates last week and it was a huge number.

 
 
  Jane Fox   8/23/200,  12:43:48 PM
How many times have you kicked yourself for not taking a trade that would have been widely profitable. Well here is a story from the WSJ that should make you feel a little better.

Five years ago, Emily Cikovsky took cash instead of Google stock. She and an associate moonlighted for Google, preparing PowerPoint slides and speaking notes that co-founders Sergey Brin and Larry Page used to announce their first venture-capital funding. They were willing to pay her in stock options, she says. Instead, she sent them a bill for about $4,000.

Her associate, Abbe Patterson, did take Google stock options for this and related public-relations tasks. Forgoing a $5,000 fee, she took options for 4,000 shares. After two stock splits, she has 16,000 shares. They're now worth $1.7 million.

 
 
  Jeff Bailey   8/23/200,  12:43:35 PM
Wake up Jeff! ... I've deleted 12:37:32 post regarding GSO.X daily pivots. I apologize as I had turned on WEEKLY Pivots.

12:15:18 comments were correct.

 
 
  Jonathan Levinson   8/23/200,  12:42:55 PM
Stepping away for 5 minutes here.

 
 
  Jonathan Levinson   8/23/200,  12:38:25 PM
QQQ has drifted on light volume through rising triangle support.

 
 
  Linda Piazza   8/23/200,  12:33:30 PM
The TRAN is less than 2 points off its low of the day, less than five points above the 50-dma, currently at 3085.55, with the TRAN at 3090.27.

 
 
  Linda Piazza   8/23/200,  12:27:12 PM
The OEX is approaching nearest Keltner support on the five-minute chart, with that support down to 536.06. A drop much below that would again set up a possible downside target near the mid-channel support, with that support now having moved higher, to 535.20.

 
 
  Jane Fox   8/23/200,  12:25:26 PM
Dateline WSJ - MOSCOW -- Despite dire warnings from the Russian company's management, oil-sector observers don't believe OAO Yukos's woes will have a short-term impact on its crude-oil output and exports -- largely because the country's government has too much to gain from maintaining steady production at the oil giant.

Yukos managers last month warned that the company was running out of cash and could face production shutdowns unless its accounts were unblocked. Fears of supply disruptions from Russia's top oil producer helped boost world crude prices to records, prompting the Bush administration to signal its concern about the impact of the Yukos affair in a flurry of calls to the Kremlin. China, which gets all of its Russian oil from Yukos, also sought guarantees about the stability of exports.

 
 
  Jeff Bailey   8/23/200,  12:24:04 PM
12:00 Internals at this Link

 
 
  Jonathan Levinson   8/23/200,  12:23:37 PM
QQQ is now resting on the rising triangle support line, with volume again slowed to a crawl. The last volume spike was on the sell side, but it too remained quite small. The short cycle oscillators are chopped up by the sideways drift and will follow the price at this point, as will the now-flattened 30 min channel with resistance at 34.31 and support at 33.96.

 
 
  Linda Piazza   8/23/200,  12:18:07 PM
The bulls couldn't break the OEX out of that triangle to the upside, so now the bears are going to try it to the downside. So far, support is holding there, too. On a day like today, I wouldn't be surprised to see a downside or upside break morph into a rectangular pattern, just as this morning's potential H&S morphed into the symmetrical triangle. Until bulls and bears battle it out and one side wins, we could have this sort of trading pattern.

 
 
  Jeff Bailey   8/23/200,  12:15:18 PM
Adobe Systems (ADBE) $45.76 -0.71% .... intra-day chart with Daily Pivots and upper 5-mrt at this Link

 
 
  Linda Piazza   8/23/200,  12:09:35 PM
I'm trying to keep an eye on the TRAN, slapped back from its attempt this morning to break above the descending trendline from the 7/01 high, but finding support at the 50-dma. This index can move fast when it begins to move, and I've been watching it as a bellwether index lately.

 
 
  Linda Piazza   8/23/200,  12:07:00 PM
The OEX just attempted another break outside of that symmetrical triangle and was pushed back again, but now gives it another try. It certainly wants to break higher, but has to stop getting slapped back first.

 
 
  Jeff Bailey   8/23/200,  12:04:55 PM
Adobe Systems (ADBE) $45.86 -0.49% .... DAILY Pivot $45.88.

 
 
  Jeff Bailey   8/23/200,  12:03:57 PM
TRIN 0.80 ....

 
 
  Jeff Bailey   8/23/200,  12:03:13 PM
VIX.X 16.12 ... session low, moves below its DAILY Pivot.

 
 
  Jonathan Levinson   8/23/200,  12:01:33 PM
30 min delayed USD Index chart at this Link . Gold is back above 412, currently 412.20, silver -2.12% at 6.726, and Nymex crude off its lows, -1.15 at 46.50 here.

 
 
  Jeff Bailey   8/23/200,  12:00:53 PM
Day trade long setup alert .... Adobe Systems (ADBE) $45.80 -0.62%. Go long on trade at $45.90, stop $45.60, target $46.80.

 
 
  Jonathan Levinson   8/23/200,  11:58:53 AM
I've drawn a rising support line off today's lows at this Link , and if it's the support line of a rising triangle, 34.20 should be key resistance above which a high volume break would set up a move to 34.30 channel resistance and 34.40-.44 confluence on the 30 minute chart. A break below 34.08-34.10 would invalidate it.

 
 
  Linda Piazza   8/23/200,  11:55:40 AM
I feel better about having conflicting feelings about market direction this morning. So did all the buyers and sellers, apparently.

 
 
  Jeff Bailey   8/23/200,  11:49:43 AM
11:00 Internals at this Link

 
 
  Jonathan Levinson   8/23/200,  11:49:03 AM
Bonds continue to weaken, with TNX now up 6.4 bps or 1.51% to 4.295%.

 
 
  Mark Davis   8/23/200,  11:46:49 AM
Day Trade Exit Point Alert -
Stopped out... SPTIA (SPX Sept 1105 call) @ 13.00 and break even

 
 
  Mark Davis   8/23/200,  11:44:25 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPTIA (SPX Sept 1105 call) to 13.00 and break even

 
 
  Linda Piazza   8/23/200,  11:42:55 AM
Here's the symmetrical triangle I'm watching on the OEX's five-minute chart. Note that there's already been one attempted break to the upside, pushed back. Link

 
 
  Jonathan Levinson   8/23/200,  11:42:20 AM
Volume has slowed to a craw, sufficiently so to stall my volume-based 100-tick QQQ chart. The 30 min channel has risen to 33.95 support/34.30 resistance, while the short cycle upphase takes a breather in the upper end of its range but not yet overbought. Link

 
 
  Mark Davis   8/23/200,  11:30:43 AM
Day Trade Entry Point Alert -
Go long now... SPTIA (SPX Sept 1105 call) @ 13.00, stop 12.00

 
 
  Linda Piazza   8/23/200,  11:23:25 AM
It looks as if the OEX, at least, might now be trying to settle into a symmetrical triangle at the top of its rise, as noted on the five-minute chart.

 
 
  Linda Piazza   8/23/200,  11:14:23 AM
The OEX hits closest Keltner support, and finds itself in the same position it was in earlier today. Five-minute closes beneath the Keltner line now at 536.36 are needed to keep the OEX pointed toward next Keltner support, now at 534.85, having risen from the 534.50-ish level from this morning. Bulls instead want five-minute closes above that Keltner line and preferably above the one at 536.82, to break the OEX out in the upside direction.

 
 
  Mark Davis   8/23/200,  11:12:17 AM
Day Trade Exit Point Alert -
Stopped out... SPTIA (SPX Sept 1105 call) @ 13.00, -3.70%

 
 
  Jeff Bailey   8/23/200,  11:11:51 AM
11:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/23/200,  11:09:51 AM
The current chop looks the result of a juxtaposed short cycle upphase and a still-intact 30 min downphase. If the price can hold at or above 34 for the next 10 minutes, I expect the 30 min downphase to abort. Below 34, the next test is 33.90, below which we should see some downside acceleration. So far, the 30 min downphase is extremely weak. Link

 
 
  Jonathan Levinson   8/23/200,  11:07:49 AM
WASHINGTON, Aug 23 (Reuters) - The U.S. Treasury Department said on Monday it will sell $24.00 billion of two-year notes on Wednesday, Aug. 25.

The notes will be issued on Aug. 31.

Proceeds from the sale will be used to refund $26.73 billion of publicly held notes maturing on Aug. 31 and to pay down about $2.73 billion.

The notes announced on Monday mature Aug. 31, 2006.

 
 
  Linda Piazza   8/23/200,  11:03:51 AM
The TRAN hasn't been able to climb back above 3100 and the descending trendline off the 7/01 high. So far, there was just that expected (by me, anyway) poke above that resistance and an immediate rebuffing to send it back below.

 
 
  Linda Piazza   8/23/200,  11:00:54 AM
So far, the OEX continues finding resistance where Keltner resistance should be found, but I don't yet have complete confidence that resistance will continue to hold. Keltner lines are converging, but they're still all turning higher, hinting that the OEX could stay beneath them and still climb. The 15-minute chart has been showing bearish price/MACD divergences at each peak since 8/17. Sometime or other, the underlying weakness suggested by the bearish divergence will reassert itself and the OEX will decline and find firmer support before climbing again. It may be beginning now, as bearish divergence, Keltner style, now begins to show up for the first time, too, but there's possible vulnerability (for those in bearish positions) up to 540-541.60, too. Strongest resistance appears to be in the 537-537.60 region, with support at 536 and again at 534.80 or so.

 
 
  Jonathan Levinson   8/23/200,  11:00:03 AM
Nymex Oct crude is down 1.25 or 2.62% here at 46.40.

 
 
  Jonathan Levinson   8/23/200,  10:57:06 AM
Gold is breaking 412 support here, currently down 3.80 at 411.60, with HUI down 2.66% and XAU -2.16%. Bonds continue to weaken as well, TNX up 5.8 bps at 4.289%. If this is the start of a new daily cycle upphase for TNX, as I believe it to be, then the pattern we're seeing today could last for another 2 weeks or so- being yield up/bonds down, gold down, currencies down, USD up, and equities? Sideways up perhaps. Equities are the wildcard, because their daily cycle upphase seems to be out of sync with all of the others- it's ahead by approximately a week and a half.

 
 
  Mark Davis   8/23/200,  10:56:29 AM
stepping away for a few minutes...

 
 
  Jeff Bailey   8/23/200,  10:55:33 AM
VIX.X 16.14 .... session low and trades its QCharts Daily Pivot.

TRIN 0.72 .... below its QCharts Daily Pivot (1.12) where session low has been 0.66.

Looking at a potential day trade long in Adobe Systems (ADBE) $45.82 -0.58% ....

 
 
  Mark Davis   8/23/200,  10:54:00 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPTIA (SPX Sept 1105 call) to 13.00

 
 
  Mark Davis   8/23/200,  10:51:55 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPQUR (SPX Sept 1090 put) to 12.50 and break even

 
 
  Jonathan Levinson   8/23/200,  10:49:30 AM
The 30 minute cycle downphase for QQQ is so far failing to ignite the markets and is so weak that it risks whipsawing to the upside here. The daily cycle upphase has been very strong and continues to so be. If the 30 min cycle downphase can't do better than this, I'll be expecting a break of 34.22 resistance on expanding volume to bring us to a test of 34.40-.44 next.

 
 
  Linda Piazza   8/23/200,  10:38:09 AM
We still have battling H&S and inverse H&S's across the OEX's intraday charts. We have Friday's continuation-form inverse H&S, confirmed before Friday's close, and now a tentative H&S showing up on the five-minute chart. I hate seeing these conflicting formations because they suggest choppy trading conditions. This morning, I think we had some sorting-out to do before the markets decided where they wanted to go.

 
 
  Mark Davis   8/23/200,  10:36:29 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPQUR (SPX Sept 1090 put) to 12.00

 
 
  Linda Piazza   8/23/200,  10:33:15 AM
Keltner resistance held, and now we have tentative bearish divergence, Keltner style, on the five- and fifteen-minute charts to go along with the bearish price/MACD divergence on the fifteen- through 60-minute charts.

 
 
  Jonathan Levinson   8/23/200,  10:30:23 AM
Daily trendline resistance on the Dow. Look for a break of 10140-150 resistance on expanding volume for continued bullishness: Link

 
 
  Jonathan Levinson   8/23/200,  10:28:24 AM
The move stopped cold at Friday's high for QQQ, but the volume on the pullback is weak so far. 34.20-.22 continues to look like the upside line in the sand on this move.

 
 
  Mark Davis   8/23/200,  10:27:45 AM
Day Trade Entry Point Alert -
Go short now... SPQUR (SPX Sept 1090 put) @ 12.70, stop 11.50

 
 
  Linda Piazza   8/23/200,  10:27:00 AM
The Russell 2000 is lower this morning, possibly turning down below the 200-ema, with that average at 548.37. The Russell 2000's trading pattern has shown some correlation with this less-watched average over the last month. As I mentioned in this weekend's Wrap, the Russell 2000 is the closest index to a possible horizontal neckline for a potential inverse H&S, so if it's going to pull back into another shoulder, it's near the point at which it might do so. Here's a chart with the 200-ema the green average on this chart, with the added comment that the Russell 2000 has been moving up again as I typed: Link

 
 
  Jonathan Levinson   8/23/200,  10:25:56 AM
I used to rake it in at the old Merisel and Ingram Micro shows back in the early 90's. I got a "Wordperfect 6.0 for Dos" baseball cap that someone offered to buy from me last year for $75. I refused. One year, it was a 9600-baud USRobotics modem sharing kit worth several hundred dollars. The good ole daze.

 
 
  Jonathan Levinson   8/23/200,  10:22:23 AM
Session high for QQQ at 34.15 here.

 
 
  Mark Davis   8/23/200,  10:21:19 AM
Potential Day Trade Setup Alert -
Short signal developing... if we go short it will be with SPQUR (SPX Sept 1090 put)

 
 
  Jim Brown   8/23/200,  10:21:05 AM
I got plenty of goodies but I would say they were tamer than usual. Media was the real give away. Brand name DVD-R media was under 75 cents per disk with estimates of 50 cents before year end. This was down from nearly $4 less than a year ago.

 
 
  Linda Piazza   8/23/200,  10:21:01 AM
The OEX is facing Keltner resistance again, from 536.66-537.39. It's not converging tightly enough that I could say definitively that it's going to hold, but it's certainly tight enough that it has a chance of holding.

 
 
  Jonathan Levinson   8/23/200,  10:16:57 AM
Jim, how was the "SWAG" factor at the conference? Did they load you up with goodies, or were the giveaways tamer than usual?

 
 
  Jim Brown   8/23/200,  10:15:38 AM
I was at a tech conference last week partially sponsored by Sony. While there were many amazing new products the one that struck me the most was the 4GB flash memory cards for digital cameras. The 1x1 inch flash cards with 4GB of memory are available from Lexar and Sandisk already and they are not cheap. With a price range from $929 to $1129 each you would really have to have a strong desire to pony up your credit card for a pocket full of these chips.

More important for the general consumer and the reason for this comment is the price squeeze ahead for those "less than monster" flash cards. A 128M card is now $39 or less. This will pressure the profits of chip companies making these chips. BUT, stretch this analogy into the computer field and you can bet the PC chip makers are going to see the same profit squeeze while the consumer will be rewarded with ever growing products at cheaper prices. This should force some more consolidation in the chip industry or nobody will be making any money.

 
 
  Jonathan Levinson   8/23/200,  10:15:04 AM
October crude futures are down .95 at 46.725 here, -1.99%.

 
 
  Jonathan Levinson   8/23/200,  10:14:30 AM
If this bounce fails from a lower high (below 34.15), then a test of 33.80 QQQ is in the cards. Above 34.15, look for a test of 34.20-.22, above which 30 min cycle will whipsaw to the upside.

 
 
  Linda Piazza   8/23/200,  10:13:40 AM
Keltner resistance lines separate now on the OEX five-minute chart, with short-term up looking easier than short-term down, and with a likely five-minute close above the Keltner line currently at 535.82. Closes beneath that line were needed to keep alive the vulnerability to 535.46.

 
 
  Jonathan Levinson   8/23/200,  10:10:46 AM
The short cycle oscillators in that chart just posted are still running lower but are showing a small bullish divergence on the Macd histogram. 33.80 could wind up holding, given the oversold levels being reached here on the short cycle downphase- I would have expected more weakness than this, given the synchronous 30 min cycle rollover.

 
 
  Mark Davis   8/23/200,  10:09:55 AM
SOX is making another new HOD... (NOW I'm stepping away for a few minutes)

 
 
  Jeff Bailey   8/23/200,  10:09:27 AM
Current OPEN MM Profiles at this Link

 
 
  Linda Piazza   8/23/200,  10:08:14 AM
The TRAN is back below that descending trendline off the 7/01 high, with that behavior not looking particularly bullish, of course. Market bulls don't want a second shoe to fall by seeing the BIX back inside this formation: Link

 
 
  Mark Davis   8/23/200,  10:08:11 AM
stepping away for a few minutes...

 
 
  Jonathan Levinson   8/23/200,  10:06:27 AM
QQQ chart update at this Link.

 
 
  Jonathan Levinson   8/23/200,  10:03:43 AM
Descending 30 min channel support is almost lined up with flattening 60 min support at 33.81. A break below that level should see an acceleration to the downside- but look for an increase in volume to confirm the break.

 
 
  Linda Piazza   8/23/200,  10:02:03 AM
I wanted to remind readers of something that I mentioned earlier today: the bullish behavior on the Nikkei and in the European indices was accompanied by volume that was described as "thin" and "light" in the various articles. That may just be a product of the summertime trading pattern, but it can be a warning, too.

So far, the OEX is maintaining the five-minute closes needed to suggest a possible test of 534.46. The Keltner line we're watching is now at 535.89, and the OEX needs to maintain five-minute closes below that line in order to maintain that vulnerability down to 534.46.

 
 
  Jeff Bailey   8/23/200,  10:02:02 AM
10:00 Market Watch at this Link

 
 
  Jim Brown   8/23/200,  10:01:13 AM
After being away from the markets for a week and seeing the monster rebound on the nightly news I came back home this weekend and spent several hours trying to find a real reason for the rally. While there were many potential events I kept arriving at the decision that it was just an oversold bounce. The Olympics were underway with no hint of terror news and traders were relieved. The Dow held at 9800 support and the SPX at 1060. Both were strong support levels. Once the rebound found legs the shorts were squeezed and sellers moved to the sidelines.

This week could be a different story. Oil may be down today but I am still looking for a $50 print soon. The Republican convention starts on Monday with the crowd beginning to build starting on Saturday. The Olympics will be winding down and any potential terror event is running out of time. Bottom line for me is increased event risk as the week progresses and there is going to be a shortage of positive stock news to move us higher. Just an opinion but that is the way I am looking at it today.

 
 
  Jonathan Levinson   8/23/200,  9:58:24 AM
This weakness feels very ominous this morning. But so far, the selling has yielded a small inside harami against Friday's daily candle print- on the daily chart, this is a small sideways correction so far. But of course, the day is young. The 30 min cycle says that there should be more selling to come.

 
 
  Mark Davis   8/23/200,  9:58:07 AM
The SOX is still green, along with the trannies, and TRIN remains in bullish territory. I'm not sure if that's objective observation or just grasping at straws. Stay tuned.

 
 
  Linda Piazza   8/23/200,  9:56:43 AM
According to the OEX's five-minute chart, the OEX now looks vulnerable down to 534.48. However, maintaining that outlook requires that the OEX continue with five-minute closes beneath the Keltner line currently at 536.03.

 
 
  Linda Piazza   8/23/200,  9:54:59 AM
The TRAN tests 3100 again, currently at 3100.16.

 
 
  Jeff Bailey   8/23/200,  9:54:58 AM
Nasdaq-100 Tracker (QQQ) $33.93 -0.23% ... with updated weekly pivot retracement at this Link

 
 
  Mark Davis   8/23/200,  9:54:18 AM
TRIN continues to drop, currently printing .70, but so far isn't helping much with price. The late Friday afternoon swing low was 1097.95... below that I will begin to lose confidence in our long play --- Oops! there it goes... SPX currently printing 1097.60

 
 
  Linda Piazza   8/23/200,  9:53:55 AM
I've now corrected the link in my 9:51 post.

 
 
  Jonathan Levinson   8/23/200,  9:53:44 AM
The Fed's open market desk has added 8.25B in overnight money to 3B expiring for a net gain of 5.25B for the day.

 
 
  Jonathan Levinson   8/23/200,  9:52:10 AM
The lack of downside followthrough will be consistent with a 30 minute cycle rollover provided that the 33.20-.22 level doesn't get violated by any bounce. There's usually a "weightless" chop period of 1-3 hours at the top of a 30 min cycle upphase as the broad channel makes the turn. Resistance at the top of that channel is down to 34.20, support down to 33.87.

 
 
  Linda Piazza   8/23/200,  9:51:59 AM
Here's where the TRAN is with respect to that descending trendline off the 7/01 high: Link Market bulls want to see the TRAN steady here, above 3100, and begin to climb again or else this begins to look like a failed push above that trendline. It's natural to see a trendline retested, but now that the first retracement period of the day is nearing completion, the TRAN needs to climb again.

 
 
  Jonathan Levinson   8/23/200,  9:47:48 AM
Session lows for QQQ at 33.95 here, with the wavelet upphase whipsawing and setting up a test of 33.90 support. Rising 60 min channel support is at 33.80, but the break of 33.90 should set the stage for a more extended decline under the influence of the overdue 30 min cycle downphase.

 
 
  Mark Davis   8/23/200,  9:45:57 AM
SPX was slapped back right at 1100, where I suspected it would be. As long as it doesn't drop back too far our long play has a chance. If we break 1100 it may turn into support.

 
 
  Linda Piazza   8/23/200,  9:45:28 AM
During the first retracement of the day, the OEX begins pulling back from below that Keltner resistance. It has held through the first retracement of the day. Now we need to see if 535.60-ish first support holds. Below that is 534.20-534.47 support, and then strongest support is in the 532 region. Bearish divergence shows up on 15- through 60-minute charts.

 
 
  Jonathan Levinson   8/23/200,  9:43:55 AM
Gold is holding most of its losses but has yet to violate 412 support, currently down 2.30 at 413.10. HUI is down 1.79% at 205.74, XAU -1.29% at 94.58.

 
 
  Jonathan Levinson   8/23/200,  9:41:17 AM
Crude oil is weaker, now down .875 at 46.775 for the October Nymex contract.

 
 
  Linda Piazza   8/23/200,  9:41:07 AM
The SOX inches up, but is still below the 388.40-ish area that has been resistance lately.

 
 
  Jonathan Levinson   8/23/200,  9:39:43 AM
A break above 34.10 sets us up for a retest of Friday's QQQ high at 34.15, above which is that 34.22 Keltner target. So far, this buy program is registering only as a wavelet bounce.

 
 
  Jeff Bailey   8/23/200,  9:39:38 AM
TRIN 0.79 ....

 
 
  Mark Davis   8/23/200,  9:39:33 AM
Day Trade Entry Point Alert -
Go long now... SPTIA (SPX Sept 1105 call) @13.50, stop 12.50

 
 
  Linda Piazza   8/23/200,  9:38:41 AM
The TRAN is testing that descending trendline off the 7/01 high, inching above it as I type.

 
 
  Linda Piazza   8/23/200,  9:36:10 AM
The TRAN moves closer to 3100, and a test of the top of its regression channel in place since late June.

 
 
  Jeff Bailey   8/23/200,  9:35:56 AM
TRIN 1.04

 
 
  Linda Piazza   8/23/200,  9:35:05 AM
Welcome back from me, too, Jim.

As I suspected, the OEX is moving up toward resistance up to 537 on the five-minute Keltner chart, and as I suspected, that resistance looks just a little less firm than it did pre-market. It is still possibly firm enough to stop the OEX, but I can't rule out a test of the 540-541 region, depending on what happens at that 537 region and during the first pullback.

 
 
  Jonathan Levinson   8/23/200,  9:32:02 AM
Not a lot of strength at the open. A break below 33.90 for 5 mins should kick off the 30 min cycle downphase for QQQ- above 34.15 sets up a test of 34.22 channel resistance, but that should be the top of this 30 min cycle upphase if we see it.

 
 
  Mark Davis   8/23/200,  9:30:51 AM
I was thinking the same thing re: a textbook entry short. I'm always suspicious of those "slam dunks". This is an old chart but illustrates what happened the last two times SPX came out of deeply oversold conditions from the bottom of the bulb of a "b" distribution pattern. Link
The market may surprise us all.

 
 
  Jim Brown   8/23/200,  9:25:03 AM
I think you did a great job on the setup. 1103-1105 should be a textbook short and that worries me to have a picture perfect entry right out of the gate.

 
 
  Mark Davis   8/23/200,  9:23:34 AM
Jim we were just setting things up for your short entry.

 
 
  Mark Davis   8/23/200,  9:21:48 AM
Welcome back from me also Jim. I suppose now that the cat is back, the mice will have to behave themselves (grin)

 
 
  Linda Piazza   8/23/200,  9:18:37 AM
Futures are slightly higher this morning, and crude futures for October delivery are near Friday's close. Although I'm never good at guessing where the OEX might open based on the SPX futures, those two in combination might suggest that the OEX will open near the close or perhaps slightly higher. If so, it could rise first toward a test of gathering Keltner resistance from 536.37-536.96. That resistance looks relatively firm, but if the OEX should gap open above them--an event that seems unlikely at this moment--or zoom above them in early trading, it's possible that they won't be as strong as they look now. For now, however, it appears that the gathering Keltner resistance will serve as the first place from which the OEX might consolidate or pull back during the first retracement of the day. By then, TRIN might have settled down and we might information from other breadth indicators to help guide us.

If I look only at these intraday charts, I'd say that the OEX is due for a retracement, perhaps to 534, perhaps even to 532. If I look at the weekly chart, I see that such a retracement would be working against the reversal signal produced last week. Let's get some more information before we make up our minds.

 
 
  Jonathan Levinson   8/23/200,  9:17:32 AM
Refreshable view of the USD Index (30 min delayed) at this Link.

 
 
  Jonathan Levinson   8/23/200,  9:16:49 AM
Welcome back, Jim. You've been missed.

 
 
  Jonathan Levinson   8/23/200,  9:08:29 AM
Euros and CDN dollar futures are just off session lows as well- so we see bonds, metals and currencies down. So far, this lines up with the impending daily cycle upphase for the USD Index and TNX and downphase for gold discussed in the weekend Futures Wrap, but we obviously need to see followthrough in the price.

 
 
  Jonathan Levinson   8/23/200,  9:03:37 AM
Bonds are weak this morning, session lows just printing for ZN futures with TNX up 5 bps or 1.18% at 4.281%. Gold is also weak, session low here at 412.40, down 3. A move below 412 opens to door to a retest of 408, below which I expect a daily cycle downphase to kick off.

 
 
  Jonathan Levinson   8/23/200,  8:35:43 AM
QQQ continues higher here, up to 34.10. 30 min channel resistance is up to 33.22, and the 30 min cycle oscillators are topped out and on the verge of trending, with a bearish Macd divergence as well. A move to that upper level, if it occurs, should hit solid resistance and, if it breaks back below 34.10, should set up a good short entry from which to ride the now-due 30 minute cycle downphase. Link

 
 
  Jonathan Levinson   8/23/200,  8:07:40 AM
Equities are higher, with ES trading 1099, NQ 1370.5, YM 10115 and QQQ +.04 at 34.05. Gold futures are down 2 to 413.4, silver -.062 to 6.81, 10-yr bonds -.25 to 112.4688, euros -.38% to 1.2256 and crude oil -.70 or 1.47% to 46.95.

There are no major economic reports scheduled for today.

 
 
  Linda Piazza   8/23/200,  7:09:06 AM
Good morning. Before Japanese markets opened Monday morning, articles mentioned expectations that those markets would gain, and that's exactly what they did in early trading. The Nikkei spent the morning session testing 11,000, tested it once again in early afternoon, and then turned down to close at 10,960.97, still higher by 71.83 points or 0.66%. Those gains were made with lower volume, however. Last week, a French minister had quantified the effect of a certain oil price on France's GDP, and Sunday, Japan's Economy Minister did the same, reportedly saying that a $10 gain in the price of crude trims GDP expansion by 0.4%.

Many stocks reacted to specific news. UFJ Holdings fell and Mitsubishi Tokyo gained, the two stocks reacting to their integration plans decided upon after signing their basic merger agreement last week. Retailer Daiei's three top creditors will seek help from the state-run IRC, the Industrial Revitalization Corp, rather than approving Daiei's restructuring plan, sending the troubled company's stock more than 24% lower. Reportedly, NTT DoCoMo will use Motorola's handsets beginning next spring for its G3 FOMA mobile service. NTT DoCoMo closed lower by 0.5%, after having been higher earlier in the day. One tiremaker, Sumitomo Rubber Industries, gained after mentioning plans to meet growing demand, while Bridgestone fell after a fire injured 13 people and destroyed a portion of a plant in Fukuoka.

Most other Asian markets gained as techs tended to perform well. The Taiwan Weighted gained 0.68%. South Korea's Kospi was flat, but Singapore's Straits Times gained 0.33%. Hong Kong's Hang Seng gained 0.44%, but China's Shanghai Composite was down 1.22%. At a close of 1,325.413, the Shanghai Composite is now at the bottom of the roughly 1,300-1,800 range in which it's traded since late 2001. Link

Currently, European bourses all trade higher on volume that is also described as low, with techs and airlines higher as crude costs remained below last week's high. Air France and Deutsche Lufthansa both gained, with the two dipping last week after announcing new fuel surcharges to cope with rising fuel costs. In the U.K., British Airways was also helped after it avoided a strike by check-in staff. Monday UBS and Merrill Lynch touted chip and medical equipment manufacturer Philips Electronics. UBS upgraded it, and Merrill Lynch added it to its European focus list, with Philips gaining as a result in early trading. In other stock-specific news, GlaxoSmithKline was gaining as a result of a U.S. District Court ruling that the company termed favorable in a patent litigation case with Teva Pharmaceuticals over a chemotherapy drug. Another patent case is still in trial.

Currently, the FTSE 100 trades higher by 47.50 points or 1.09%, at 4,416.70. The CAC 40 trades higher by 55.11 points or 1.56%, at 3,593.13. The DAX trades higher by 62.67 points or 1.69%, at 3,775.28.

 
 
  Linda Piazza   8/22/200,  10:21:42 PM
The OEX ended Friday within a resistance band from 535-537 showing up on the daily Keltner charts, but with the possibility that the OEX and that resistance band, too, could be shoved up to 540-541 before enough resistance converges to hold the OEX back. Historical resistance, the 50-dma, and Keltner resistance all gather in that area. Daily oscillators presented the possibility of more upside before a rollover, with the possibility of a push all the way up to the 200-dma not ruled out. The weekly chart showed a completed morning-star reversal formation. Yet the daily chart Keltner chart also shows resistance near that 535-537 area, and the daily bar chart shows the possibility for an inverse H&S, presenting the possibility of a pullback to form another shoulder anywhere from the current level up to 541.60 or so.

In the last 15 minutes of trading Friday, the OEX headed lower, setting up a potential test of the 535 support and then the 534.50 support if that didn't hold. That support comes from Keltner support as well as historical support. The 5-minute chart showed Keltner resistance beginning to gather from 536.37-536.96, and beginning to firm up enough to possibly stop the OEX if it should open below that level and attempt a bounce first before reestablishing support.

However, we know how well we can trust the last few minutes of trading on a Friday afternoon, particularly an opex Friday. I'd like to see how things shake out early tomorrow morning. For now, the Keltner chart looked as if the OEX might be headed down toward 534.50-535.00 to reestablish support and then rise again toward a possible neckline of a potential inverse H&S. I've been saying since Wednesday that I expected limited upside, and the OEX is still less than two points above Wednesday's close. I still expect limited upside, but "limited" can mean different things to different people, and I can't rule out a possible test of 540-541.60, the 200-dma or even the top of the descending regression channel. I had expected this 535-537 level to hold, but had suggested that it was possible that the OEX could rise up to 540-541 before stalling, if it's going to stall. The 30- and 60-minute charts show candles that are beginning to look spiky with upper shadows, sometimes a tell-tale sign that the OEX is weakening. Bearish price/RSI divergences were beginning to show up on those 30- and 60-minute charts.

Those divergences can continue while prices climb, but they're enough evidence to make me leery of suggesting that aggressive traders might go long on dips to 534.50-535, especially with potential upside limited. The daily bar chart suggests that pullbacks to 534.50-535 might make decent bullish entries, but Keltners suggest oversold conditions on a short-term basis, and there are all those spiky candles and bearish divergences on the 30-minute chart. Let's see how things look tomorrow morning. Watch the TRAN, as I wouldn't be surprised to see a spike up to 3100-3110 to test the top of its descending regression channel, ahead of a similar test on other indices. That TRAN test could tell us much about what to expect from other indices.

 
 
  Jeff Bailey   8/22/200,  6:16:49 PM
nq04u ... settled 1,367.50 on Friday, trading 1,368.00 here (10-minute delayed).

 
 
  Jeff Bailey   8/22/200,  6:15:27 PM
es04u settled at 1,098.75 on Friday, trading 1,098.50 bid (10-minute delayed).

 
 
  Jeff Bailey   8/22/200,  6:13:07 PM
S&P 500 Index (SPX.X) ... with updated WEEKLY Pivot levels at this Link

 
 
  OI Technical Staff   8/20/200,  7:50:08 PM
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