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  Jeff Bailey   8/24/200,  6:10:36 PM
Pivot Matrix for tomorrow at this Link

 
 
  Jeff Bailey   8/24/200,  5:20:55 PM
Closing Internals at this Link

 
 
  Jeff Bailey   8/24/200,  4:20:48 PM
Current OPEN MM Profiles at this Link

Today's Activity ....

Day trade short Dollar Tree (DLTR) at $25.04 bid, stopped $24.66 offer ($0.38, or +1.52%).

Day trade short Microsoft (MSFT) at $27.27, stop $27.44, target $27.03. Carry over to tomorrow's session. Target may change based on tomorrow morning's trade.

 
 
  Mark Davis   8/24/200,  4:18:16 PM
I'd like to take this opportunity to thank readers for all the emails I've recieved since becoming part of the team here. My OptionInvestor email address was not operational until yesterday afternoon, so if you emailed me and didn't receive an answer that is why. Many of the emails asked questions about my trading system, oscillator settings, etc. I will address this in an upcoming Trader's Corner article. In the meantime, keep 'em coming and thank you... Mark

 
 
  Mark Davis   8/24/200,  4:03:47 PM
I had to cancel that last trade because it didn't post until 16:00:11, giving no chance for cash index traders to enter.

 
 
  Jeff Bailey   8/24/200,  3:56:53 PM
Dollar Tree (DLTR) $24.65 -0.36% ... eases back toward its DAILY Pivot ($24.60).

 
 
  Jeff Bailey   8/24/200,  3:56:01 PM
QQQ $34.04 -0.14% .... follows MSFT and looks to reclaim daily pivot by the 04:00 mark.

 
 
  Linda Piazza   8/24/200,  3:55:43 PM
The OEX's five-minute Keltner resistance at 535 appears to be firming up, but I guess we'll see before the close whether it's going to hold on a five-minute closing basis or not.

 
 
  Jeff Bailey   8/24/200,  3:55:13 PM
Bearish day trade update alert .... for Microsoft (MSFT) $27.21 -0.11% ... will hold overnight as it looks like "Mr. Softy" wants to close at its DAILY Pivot.

 
 
  Mark Davis   8/24/200,  3:54:58 PM
I'm tempted to take a long and hold it overnight.

 
 
  Mark Davis   8/24/200,  3:53:56 PM
Day Trade Exit Point Alert -
Stopped out... SPX 1095.41 and break even

 
 
  Jeff Bailey   8/24/200,  3:53:48 PM
CBOE Internet Index (INX.X) 164.93 -0.22% .... just off its morning lows and DAILY S1 of 164.24.

 
 
  Linda Piazza   8/24/200,  3:53:48 PM
The TRAN is just under 3100 resistance, but has printed a tall white candle for today. Its sister index, the Dow, is just under 10,100 (as I type, anyway), but has printed a far less healthy looking small-bodied candle with a long upper shadow. The TRAN sometimes overruns resistance, so do we believe the TRAN's stronger-looking candle or the Dow's less-healthy-appearing one? Even on the TRAN, however, the candle bodies forms below 3100 (so far) and the descending trendline off the 7/01 high.

 
 
  Mark Davis   8/24/200,  3:52:48 PM
Day Trade Exit Point Alert -
Cinch up your stops... to SPX 1095.41 and break even

 
 
  Jeff Bailey   8/24/200,  3:52:39 PM
Netease.com (NTES) $33.02 -1.66% ... probes morning lows and DAILY S1 $33.02.

 
 
  Jeff Bailey   8/24/200,  3:50:29 PM
Microsoft (MSFT) $27.15 -0.33% ... sitting on its DAILY S1 of $27.13. DAILY S2 lower at $27.03.

 
 
  Jeff Bailey   8/24/200,  3:49:18 PM
Intel (INTC) $21.57 -1.37% ... gets a trade at its DAILY S2.

 
 
  Jeff Bailey   8/24/200,  3:46:50 PM
VIX.X 15.50 .... still pinned under DAILY S1 of 15.59.

Between TRIN and VIX .... 2 bears and 1 bull.

 
 
  Jeff Bailey   8/24/200,  3:46:06 PM
TRIN 1.36 ... afternoon highs.

 
 
  Jonathan Levinson   8/24/200,  3:44:55 PM
Oil is down to an evening session low now at 45.15. QQQ has regained 33.90, and bulls would be happy with that higher short cycle low at 33.86 given the current levels of the 30 min cycle oscillators. I expect a new upphase to begin forming at tomorrow's cash open.

 
 
  Linda Piazza   8/24/200,  3:43:05 PM
Here's another dreaded neutral triangle to watch, this one on the OEX's 15-minute chart: Link

 
 
  Mark Davis   8/24/200,  3:42:26 PM
Day Trade Exit Point Alert -
Go short now... SPX 1095.41, stop 1097.50

 
 
  Jeff Bailey   8/24/200,  3:40:35 PM
Bearish day trade close out alert .... for Dollar Tree (DLTR) at the $24.66 offer.

 
 
  Mark Davis   8/24/200,  3:40:12 PM
Potential Day Trade Setup Alert -
We should have gone long the minute I saw that long signal confirm, but these things are only visible in the rear view mirror, besides, there is a developing short signal now... stand by

 
 
  Linda Piazza   8/24/200,  3:38:25 PM
The TRAN inches above 3100 and tests the trendline off the 7/01 high.

 
 
  Jeff Bailey   8/24/200,  3:33:11 PM
Cyberonics (CYBX) $21.08 +10.5% ... on the move.

 
 
  Linda Piazza   8/24/200,  3:30:33 PM
Chop and more chop. The OEX is not delivering the needed lower low today, at least so far, with that failure to reach a new low of concern to those in bearish OEX plans. Begin thinking about whether you want to hold overnight if you're in a bearish play or a bullish one, for that matter. I'm seeing Keltner resistance still trying to build just over the current (534.66) OEX position, but we now we've got possible bullish divergence, Keltner-style, on this latest five-minute low, so I'm not sure that resistance is going to hold. The OEX is settling into an equilibrium position on both the 5- and 15-minute Keltner channels, which means that without a breakout or breakdown, we could be looking at a tight two- to three-point range until that breakout.

 
 
  Jonathan Levinson   8/24/200,  3:23:20 PM
Evening session high for crude oil here at 45.374.

 
 
  Mark Davis   8/24/200,  3:22:20 PM
Day Trade Exit Point Alert -
Stopped out... SPX 1094.55, +2.00

 
 
  Jonathan Levinson   8/24/200,  3:20:29 PM
I've got a headache and little patience for the current chop zone, but the 30 min chart is edifying. The 300 min stoch has reached the lowest levels in one week, but price is at a higher low for QQQ- the site of the last 300 min stochastic bottom was 33.44. The stochastic isn't bottomed here yet, but so far 33.81 is the price low and 33.90 is exerting a magnetic pull. A higher price low against this lower oscillator low would look like a bullish non-confirmation to me, another type of divergence, and will set up a retest of the most recent 33.10 short cycle high tomorrow. This divergence tells us that the daily cycle upphase is still alive and kicking. But price is going to have to cooperate- a print below the 33.38-.44 level will invalidate this scenario, while a move back above today's high will confirm it. Link

 
 
  Linda Piazza   8/24/200,  3:18:05 PM
The SOX isn't doing so hot, is it? The Russell 2000 continues to find resistance at its 200-ema. However, the TRAN continues to test 3100 and the BIX so far parks its candles right on top of the former resistance line of its megaphone shape. We're still seeing mixed signals from these indicator indices, which worries me as it may indicate that we're still going to chop around for a while. Bears certainly would like to see a new low of the day for the OEX.

 
 
  Mark Davis   8/24/200,  3:16:14 PM
Day Trade Exit Point Alert -
Cinch up your stops... to SPX 1094.55
If we're stopped out so be it... at this point I'll take the 2 points
We have a confirmed buy signal on the 1-min chart. It could easily abort but after today's wild ride I'm going to respect it.

 
 
  Linda Piazza   8/24/200,  3:12:32 PM
So far, the OEX's middle-width Keltner channel still slants generally lower, toward the bottom support at 532.49. First, however, the OEX now faces support from the bottom of that middle channel, a line that usually stops declines unless there's to be a breakdown, something that hasn't happened yet. Just as I suggested earlier today, have profit-protecting plans in place as this 533.50-534 level is tested.

 
 
  Jonathan Levinson   8/24/200,  3:10:00 PM
QQQ update at this Link.

 
 
  Mark Davis   8/24/200,  3:08:10 PM
This market is dragging it's heels kicking and screaming for every tick down. Sheesh!

 
 
  Jeff Bailey   8/24/200,  3:06:18 PM
03:00 Market Watch at this Link

 
 
  Linda Piazza   8/24/200,  3:06:15 PM
The OEX heads down toward 534 mid-channel Keltner support on the 15-minute chart, and toward a test of the double-bottom level.

 
 
  Jonathan Levinson   8/24/200,  3:03:36 PM
Session high for 10-yr treasuries, +.4 bps at 4.283%.

 
 
  Jonathan Levinson   8/24/200,  3:03:16 PM
Session low for INTC here. Volume has slowed to a crawl on QQQ, as it tests yesterday's low at 33.92.

 
 
  Linda Piazza   8/24/200,  3:01:39 PM
The OEX breaks minimally below the 534.50 level that has been supporting it . . . well, a bit more than minimally as I typed.

 
 
  Jeff Bailey   8/24/200,  3:00:49 PM
NASDAQ-100 component ... Ross Stores (ROST) $22.09 +1.56% ... pressing morning high of $22.11.

 
 
  Mark Davis   8/24/200,  3:00:18 PM
Day Trade Exit Point Alert -
Cinch up your stops... to SPX 1096.55 and break even
I don't care if we get stopped out at break even. I'm just not willing to give up another point to this market. We can always reenter a short from a higher level (or a long for that matter... that's how confusing this is).

 
 
  Linda Piazza   8/24/200,  2:56:42 PM
Don't look now, but the TRAN tests 3100 again, at 3099.36 as I type.

 
 
  Linda Piazza   8/24/200,  2:51:54 PM
Remember that I mentioned in the weekend Wrap, written in substitution for Jim while he was out of town, or else in my first OEX-related post yesterday, that the OEX tended to produce those well-formed morning-star formations on the weekly chart when it touched the bottom of the descending regression channel? Remember that I also mentioned that when that happened in late March, the OEX spent the next three weeks consolidating, printing doji or small-bodied candles while it chopped around during the week? Sure hope we don't have something similar happen this time, after last week completed another morning-star pattern at the bottom of the ascending regression channel. Could happen. Just hope it doesn't.

 
 
  Jonathan Levinson   8/24/200,  2:50:12 PM
The wavelet oscillator is trying to bounce within the stalled short cycle upphase. The 30 minute cycle for QQQ has paused within the ongoing downphase- that downphase was confirmed by the lower high at 34.10. Unless bulls can break that high within the next hour, that downphase should continue into tomorrow's open. Current 30 min channel ressitance is holding at 34.20 QQQ.

 
 
  Linda Piazza   8/24/200,  2:46:27 PM
The OEX is certainly lingering long enough to let that Keltner resistance build overhead. In fact, if it keeps lingering, the converging lines are going to begin separating.

 
 
  Mark Davis   8/24/200,  2:46:20 PM
I'm ready to use plastic explosives Keene

 
 
  Jeff Bailey   8/24/200,  2:45:16 PM
Day trade lower stop alert .... for Dollar Tree (DLTR) $24.63 -0.44% .... to $24.72.

 
 
  Jeff Bailey   8/24/200,  2:40:48 PM
Dollar Tree (DLTR) $24.69 -0.60% ... penny below its DAILY Pivot ($24.60), DAILY S1 lower at $24.21, but it has been a battle to this point.

 
 
  Jeff Bailey   8/24/200,  2:39:47 PM
Intel (INTC) $21.74 -0.68% .... third test of its DAILY S1 today. I think this is where SOX.X finds current session lows from.

 
 
  Linda Piazza   8/24/200,  2:39:25 PM
The OEX looks ready to test the 533.63-564.05 level.

 
 
  Mark Davis   8/24/200,  2:39:16 PM
b-bands getting very tight again so we should see a move here... please Lord, let it be to the downside.

 
 
  Jonathan Levinson   8/24/200,  2:35:32 PM
Session high for ten year treasuries here, TNX +.6 bps at 4.285%.

 
 
  Mark Davis   8/24/200,  2:33:22 PM
stepping outside for a few minutes... don't let me get stopped out or I may have to pull out what little hair I have left

 
 
  Linda Piazza   8/24/200,  2:30:25 PM
The longer the OEX lingers near the current level, the more likely the overhead resistance will have the opportunity to firm.

 
 
  Jonathan Levinson   8/24/200,  2:24:40 PM
The failure at 34.10 was a lower high, and unless the bulls can put something big together quickly (ie above 33.90), the short cycle will fail from a lower price and oscillator high. The break below 33.90 will set up a retest of the session lows, and with the 30 min cycle channel support down at 33.75 currently, it will be likely that we see them break.

 
 
  Linda Piazza   8/24/200,  2:24:15 PM
The Russell 2000 again tested its 200-ema today and again fell back from that average, with that average currently at 548.29.

 
 
  Mark Davis   8/24/200,  2:23:30 PM
SOX just made a new LOD @ 379.76

 
 
  Jeff Bailey   8/24/200,  2:22:54 PM
SOX.X 379.96 -2.59% .... didn't see the light of day above its DAILY R2 when QQQ bounced back to DAILY Pivot.

Testing the lows here.

 
 
  Jeff Bailey   8/24/200,  2:19:57 PM
Bearish day trade lower stop alert .... For Dollar Tree (DLTR) $24.70 -0.16% .... to break-even.

Troops are closing in on holy shrine in Najaf.

 
 
  Linda Piazza   8/24/200,  2:17:23 PM
I couldn't get that 14:12 post typed and uploaded fast enough. The OEX violated the support I was mentioning before I could finish the post. By the time I finished it, it was already bouncing from $0.10 above the level I was suggesting that bears be watchful for a bounce. I'm a fast typist, but sometimes no one can type fast enough.

Now the OEX tests gathering Keltner resistance from 534.97-535.20, with that resistance looking as if it might be firm enough to hold the OEX back.

 
 
  Jeff Bailey   8/24/200,  2:16:36 PM
Scratch...scratch .... VIX.X 15.44 .... still pegged near its session lows of 15.36.

 
 
  Jeff Bailey   8/24/200,  2:15:29 PM
TRIN 1.18 ... just "popped" do DAILY R2 of 1.32.

Computers have ahold of these markets today. No doubt about that.

 
 
  Jonathan Levinson   8/24/200,  2:13:50 PM
Rising trendline resistance held at 34.10, and the move back below 34.00 QQQ is taking place on solid volume. This is the long awaited wavelet cycle downphase, and unless it bottoms above 33.90, the bulls are going to have a problem on an early abort to the short cycle upphase: Link

 
 
  Jeff Bailey   8/24/200,  2:12:59 PM
Dollar Tree (DLTR) $24.68 -0.24% ... somebody pulled their bid. Session lows.

 
 
  Linda Piazza   8/24/200,  2:12:31 PM
The OEX slips back below the mid-channel level on the OEX's five-minute Keltner chart, but it's got light support just under it, too. It looks as if it was turned down below the Keltner channel that usually turns it lower, creating bearish divergence with relationship to that channel, and may now zoom down to the channel line that usually stops it on the downside. Watch that 534.40 level, though, for a rounding up into a possible right shoulder for an inverse H&S.

 
 
  Jeff Bailey   8/24/200,  2:12:18 PM
Microsoft (MSFT) $27.21 -0.11% .... sloppier than the QQQ at its DAILY Pivot of $27.23.

 
 
  Jeff Bailey   8/24/200,  2:11:12 PM
QQQ $34.05 -0.11% .... sellers stood their ground on the test back at the DAILY Pivot. Link

 
 
  Jeff Bailey   8/24/200,  2:06:46 PM
02:00 Internals at this Link

 
 
  Mark Davis   8/24/200,  2:01:54 PM
Day Trade Entry Point Alert -
Go short now... SPX 1096.55, stop 1097.50
This thing is begging to be shorted. We've had negative MACD divergence for over an hour accompanied by no less than 5 CCI readings over +200.

 
 
  Mark Davis   8/24/200,  1:57:29 PM
We got our move up with a big green 1-min candle that was slapped back immediately by an equally large red candle... that's a finger formation and it's what I feel like the market is giving me today.

 
 
  Jeff Bailey   8/24/200,  1:57:13 PM
01:55 Market Watch at this Link

 
 
  Jonathan Levinson   8/24/200,  1:55:50 PM
QQQ is testing rising trendline resistance here: Link

 
 
  Mark Davis   8/24/200,  1:54:28 PM
SPX 1-min b-bands are getting pinched again so we should see another move very soon... I'm guessing up but am too bruised up to issue a call.

 
 
  Linda Piazza   8/24/200,  1:48:58 PM
Support is trying to form below the OEX. It's not yet converged tightly, but that support ranges fairly closely from 534.77-535.20. If the OEX drops quickly and deeply, it can get through the support, but if the OEX lingers here, it might allow it to converge more tightly and firmly.

 
 
  Jonathan Levinson   8/24/200,  1:45:31 PM
Stepping away for a few moments to nurse this headache.

 
 
  Jeff Bailey   8/24/200,  1:44:34 PM
Dollar Tree (DLTR) $24.94 +0.80% ... post bearish profile high/low has been $25.12-$24.85.

DAILY R1 is $25.15, DAILY Pivot lower at $24.60.

S&P Retail Index (RLX.X) 387.75 +0.53% .... session low of 386.00 came close to DAILY Pivot of 385.37, trades its DAILY R1 right here. Session high of 390.08 pretty much pegged its DAILY R2 of 389.89.

 
 
  Linda Piazza   8/24/200,  1:42:48 PM
There's a reason I call this the stop-running time of day. The OEX ran up above a hypothetical horizontal neckline for an inverse H&S and the mid-channel level on the five-minute chart. It got slapped right back, but not far back, so I'm not sure what lesson the big girls and boys will take from this, but I think they'll try to run it up again. The OEX will hit the channel line that usually turns it lower at 535.99. Sure am glad I suggested profit-protecting procedures near 533.50-534 for those who might have entered bearish OEX plays near 537.

 
 
  Jeff Bailey   8/24/200,  1:41:29 PM
Dow Industrials 10,100 +0.27% .... just above its DAILY Pivot

SPX.X 1,096.47 +0.07% .... just tested its DAILY Pivot

QQQ $34.03 -0.17% .... didn't quite get a re-test of its DAILY Pivot. Came shy by a penning.

Micosoft (MSFT) $27.24 (unch) now. Right at its DAILY Pivot.

 
 
  Jonathan Levinson   8/24/200,  1:37:44 PM
The 30 min cycle channel is upticking now from its previous flat. Those not interested in trading this blender can wait for a break above 34.22 or below 33.90 and then trade a break above or below the day high/low, as the case may be. A break in either direction will be leading the 30 min cycle by the nose and should be directional, at least based on the current oscillator setup.

 
 
  Mark Davis   8/24/200,  1:34:18 PM
Jonathan I'll take a 5 pound box please

 
 
  Jonathan Levinson   8/24/200,  1:32:33 PM
Anyone else hitting the Advil here?

 
 
  Mark Davis   8/24/200,  1:32:11 PM
Day Trade Exit Point Alert -
Stopped out... SPX 1096.50, -1.00
What a frustrating day... shaken around like a rag doll.

 
 
  Jonathan Levinson   8/24/200,  1:29:28 PM
Here's the test of 34.05. Volume is weak, but the short cycle upphase has just confirmed. The wavelet oscillators are trending in overbought. 34.00 should now act as support. 30 min channel resistance rises to 34.16.

 
 
  Mark Davis   8/24/200,  1:25:24 PM
Jim I'm even going to be more ticked if I missed that long entry @ 1092.87, right where I though it might bounce, but the fear factor was too strong to enter another long play and the readings at the time were supporting further downside (except the ones I normally use to enter trades)

 
 
  Linda Piazza   8/24/200,  1:24:43 PM
OEX bears need to be careful if the OEX rounds down anywhere from the current level to 535.25, but then steadies at 534.40 or so and then rounds up again. There's the possibility for an inverse H&S, seen here on the three-minute chart: Link Bulls should be aware that these inverse H&S's haven't been meeting their upside targets lately, a warning sign. Their purpose appears to be to stop bears out of their plays!

 
 
  Jonathan Levinson   8/24/200,  1:20:02 PM
QQQ chart at this Link . The wavelet upphase is maxxed out, and it will take a trending move to break above 34.05 on this run. That's not difficult to do for the short wavelet cycle, but I'm still guessing at one more dip to a higher low first.

 
 
  Mark Davis   8/24/200,  1:19:22 PM
1-min CCI is once again printing over +200... we're either topping out here or this is turning into a trending move to the upside.

 
 
  Mark Davis   8/24/200,  1:16:50 PM
Day Trade Exit Point Alert -
Cinch up your stops... to SPX 1096.50
Just in case the move is to the upside

 
 
  Jonathan Levinson   8/24/200,  1:16:27 PM
QQQ ran up to 34 on what appears to have been 3 buy programs exceeding 1M shares within 3 100-tick bars, and then stopped cold and is currently chopping along just below it on light volume. The short cycles are still trying to confirm their young upphase as the wavelet upphase tops out within it. A higher low on the wavelet pullback, preferably above 33.90, should set up a break of 34 on the next try.

 
 
  Mark Davis   8/24/200,  1:15:39 PM
We're going to move here very soon. B-bands are as tight as I've seen them in weeks on the 1-min chart.

 
 
  Linda Piazza   8/24/200,  1:11:09 PM
The OEX didn't quite dip as low as bears might have wished on the close during the last 15-minute period, but the OEX is finding resistance at two converging Keltner lines near 534.81 on the five-minute chart. Although the smallest Keltner channel on that chart is moving up currently, it's zig-zagging back and forth through a channel that's generally been moving down all day. One of the lines at which the OEX currently finds resistance is the midline of that channel, not of the broadest channel, so it's good news for bears if the OEX continues to find resistance at that 534.80-ish level on five-minute closes. It's possible, however, that the OEX could rise all the way to the mid-channel level for the widest of the channels on that chart, with that level at 535.20.

 
 
  Jonathan Levinson   8/24/200,  1:08:18 PM
The 30 min NQ chart Link shows the 300 minute stochastic testing the pattern of rising oscillator lows here. Again, a break above 34.00-.05 QQQ will coincide with an oscillator bottom respecting the trend of the past two weeks. A break lower from here will threaten it.

 
 
  Jeff Bailey   8/24/200,  1:08:17 PM
Starting to look very similar to yesterday's session.

Welcome back Jim!!!!

 
 
  Jeff Bailey   8/24/200,  1:06:20 PM
01:00 Internals at this Link

 
 
  Jonathan Levinson   8/24/200,  1:00:03 PM
Return to the session low for gold, -7.7 or 1.86% at 405.20.

 
 
  Mark Davis   8/24/200,  12:58:38 PM
We're getting zero traction so far on the short play. It's very frustrating to have missed that bounce right where I expected it might occur, but the fear factor was heavy. So far it would have been good for +2 1/2 points (where's that cat)?

 
 
  Jeff Bailey   8/24/200,  12:58:36 PM
12:55 Market Watch at this Link

 
 
  Jonathan Levinson   8/24/200,  12:57:40 PM
QQQ is up to 34.00 here, the start of confluence to 34.10. But the short cycle oscillators are just starting an upphase from deep in oversold territory, and a print above 34.05 should confirm the signals and project to 30 min channel resistance at 34.15 currently.

 
 
  Linda Piazza   8/24/200,  12:55:52 PM
The OEX did bounce out of that possible "b" distribution/basing pattern, as I'd suspected it might do. Fifteen-minute Keltner resistance is trying to gather near 535.17-535.44, but bears would really have preferred a 15-minute close beneath the channel line currently at 534.48. The OEX has four or five minutes to accomplish that bears' goal, but I'm not sure whether it's going to do that or head on up to test the resistance.

 
 
  Jonathan Levinson   8/24/200,  12:54:50 PM
Session lows for crude oil, down 2.17% or 1 point to 45.05.

 
 
  Mark Davis   8/24/200,  12:52:54 PM
Potential Day Trade Setup Alert -
Short signal developing... stand by

 
 
  Jeff Bailey   8/24/200,  12:50:11 PM
VIX.X 15.62

 
 
  Jeff Bailey   8/24/200,  12:49:33 PM
TRIN 1.32 ... slips back to its DAILY R2.

SPX 1,095.12 , QQQ $33.96.

 
 
  Jeff Bailey   8/24/200,  12:45:18 PM
U.S. Dollar Index (dx00y) 89.37 +0.33% (30-minute delayed) .... just off a session high of 89.40.

AMEX Gold Bugs ($HUI.X) 199.92 -2.4% .... session lows with DAILY R2 199.76.

 
 
  Jonathan Levinson   8/24/200,  12:45:02 PM
We have a sideways short cycle upphase in progress on QQQ, and so far no attempt on 34.00 resistance. Until the 34-34.05 level breaks, this will continue to look like a corrective bounce within a so-far strong 30 min cycle downphase. Link

 
 
  Jeff Bailey   8/24/200,  12:39:01 PM
12:00 Internals at this Link

 
 
  Mark Davis   8/24/200,  12:34:50 PM
FYI... LOD for SPX (so far) was 1092.87, which closely corresponds to a small area of congestion @ 1092.50 on the 10-min chart. If we bounce from here I'm going to find the neighbor's cat (the one who does his business in my rose bed) and punt him through the hedge... JUST kidding!

 
 
  Jonathan Levinson   8/24/200,  12:32:24 PM
Session low for gold, euros and Canuck bucks here. Down is now down 7.40 or 1.79% at 405.50.

 
 
  Linda Piazza   8/24/200,  12:31:47 PM
Is this a "b" distribution pattern on the OEX's five-minute chart or base-building before a climb? Because the OEX is forming that rectangular pattern at the mid-channel level on the 15-minute chart, I'd guess that the five-minute pattern is probably some sort of consolidation before a bounce attempt, but we have to wait until the OEX breaks out one direction or the other, above 533.85 or below 533.40, to be sure. Bears want to see the OEX close five-minute periods below the Keltner line currently at 533.89.

 
 
  Mark Davis   8/24/200,  12:28:50 PM
I broke my own trading rules this morning because of my upside bias, based in part on the past two SPX daily chart "b" distribution patterns which were good for +70 pts and +63 pts respectively, from the bottom of the bulb, and also my suspicion that a short from SPX 1100 was just "too perfect" and might be a bear trap.

SOX and TRIN were both pointing down and the SPX 1-min CCI never printed a -200 reading which is a key factor for me to issue long signals. It has just printed consecutive readings of -260 and -280, complete with a bullish MACD cross and I would normally be issuing a long signal here but SOX and TRIN are still both decidely bearish. This looks more like a trending move than an inflection point and trending moves tend to produce false buy/sell signals on the 1-min chart, so I'm going to stay flat. I don't want to chase this down after a -7 point move. We had a couple of good weeks and now we've given some back. I will now write 100 times on the blackboard... "Plan your trade and trade your plan." Good advice from Jane.

 
 
  Jonathan Levinson   8/24/200,  12:25:14 PM
Gold, euros and the Dow futures continue lower. It looks like the binary dollar relationship is back with a vengeance. However, the daily cycle upphases for the indices remain strong for the time being.

 
 
  Jonathan Levinson   8/24/200,  12:18:43 PM
Nymex crude update at this Link . Currently trading 45.70.

 
 
  Jeff Bailey   8/24/200,  12:15:05 PM
Current OPEN MM Profiles at this Link

 
 
  Jonathan Levinson   8/24/200,  12:13:04 PM
Session lows for ES and euro futures here.

 
 
  Jonathan Levinson   8/24/200,  12:12:31 PM
Any lower for the QQQ here and the right shoulder of the reverse h&s will break to the downside.

 
 
  Jeff Bailey   8/24/200,  12:08:54 PM
VIX.X 15.78 .... intra-day chart with DAILY Pivots at this Link

 
 
  Linda Piazza   8/24/200,  12:07:46 PM
The chart linked to my 10:03 post shows that the OEX has now touched a potential bounce zone. Have profit-protecting plans in place if in a bearish play from near 537. If the OEX should breakdown now, it sets a possible downside target near 532.38, according to the five-minute chart, and nearer 530-531 according to the 30-minute bar chart, so that profit-protecting plan might be one that lets you continue to participate in the play if the OEX does break down, such as selling a partial position, buying a bracketing and protective call (understand first how the tactic would work), etc. The downside target is lower even than that according to the 15-minute Keltner chart, but that's all conditioned upon a breakdown, which hasn't happened yet.

 
 
  Mark Davis   8/24/200,  12:05:59 PM
Day Trade Exit Point Alert -
Stopped out... SPX 1094.00, -1.70
That was like a guillotine. The end came suddenly and swiftly.

 
 
  Linda Piazza   8/24/200,  12:03:30 PM
The OEX is mostly showing five-minute closes beneath the Keltner line currently at 534.70, with bears preferring to see the OEX close beneath that line. It's again about to test Keltner support, gathering just under it, down to 534.08, but the 15-minute view shows that the OEX might well drop lower, to 533.50 or so, before it finds support. Note: Began dropping as I typed. If the OEX does drop to that level and if some are in bearish plays from near 537, have a profit-protection plan in mind for a test of that zone. Either follow the OEX lower with your stops (always a good idea, of course), sell all the position automatically at that point and step aside to look for another point at which to enter after a potential bounce, sell part of the position, or even use a tactic like Mark's bracketing tactic, buying a call at that level, and then setting stops that will take you out of the unprofitable position.

 
 
  Mark Davis   8/24/200,  12:02:49 PM
It's looking like you may get that wish... great call this morning on the short play

 
 
  Jeff Bailey   8/24/200,  12:02:07 PM
12:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/24/200,  12:01:01 PM
This sideways drift is starting to look like (among other unrelated things) a right shoulder of a reverse head and shoulders pattern, with the neckline at 33.99 QQQ. A break above that level on expanding volume would target 34.15.

 
 
  Mark Davis   8/24/200,  11:57:54 AM
Jim at least you're bored with +5 1/2 pts in your pocket (grin)... That's a good kind of bored

 
 
  Jeff Bailey   8/24/200,  11:53:30 AM
U.S. Dollar Index (dx00y) 89.16 +0.11% .... easing back from session highs. Here's updated chart with WEEKLY/MONTHLY Pivot retracement. Link

WEEKLY R1 just about the middle of larger triangle.

 
 
  Mark Davis   8/24/200,  11:50:38 AM
Day Trade Exit Point Alert -
Lower your stops... to 1094
Last time we got a little too close to the action and were stopped out. This will allow for a little "underthrow". We just got a CCI reading of almost -300 so maybe we're close to a short-term bottom. Many times the SECOND CCI reading of -200 or so is the real bottom.

 
 
  Jonathan Levinson   8/24/200,  11:49:39 AM
Daily chart of Dec. gold at this Link.

 
 
  Jonathan Levinson   8/24/200,  11:48:43 AM
Gold has broken 408 support, now down 5.5 to 407.40. Silver has gotten clocked for 2.79%, currently -.188 at 6.552.

 
 
  Mark Davis   8/24/200,  11:41:16 AM
I'm starting to see bullish MACD divergence on the smallest of timeframes (1-min), which diminishes it's importance, but at least it's something. I'd like to see the last 3 swing highs taken out in the SPX 1096.25 area but I see we're turning back down and threatening a MACD bearish cross (1-min). If it turns into a bullish kiss we may have a chance but the longer we move sideways the more I think we're headed lower.

 
 
  Jonathan Levinson   8/24/200,  11:39:55 AM
Closeup of today's 100-tick QQQ and the break back above descending resistance: Link

 
 
  Jonathan Levinson   8/24/200,  11:36:12 AM
Descending trendline resistance on the 100-tick QQQ is breaking to the upside here in what appears to be a descending expanding wedge since 10:45AM. The short cycles are once again trying to put together an overdue upphase, but if it fails to clear 34.00-.05, then I expect a test of 33.80 for the next wavelet downphase. The short cycle continues to fight it out with the descending 30 min cycle.

 
 
  Linda Piazza   8/24/200,  11:33:46 AM
We're getting that dreaded sideways trade out of the regression channel depicted on the chart linked to my 10:03 post. I've been warning of this possibility all morning, as such a sideways break sometimes precedes a climb back along the underside of the rising regression channel. It's normal to see a retest of broken support, but bears do not want to see the OEX climb the underside of the channel any more than they want to see it climb within the channel.

 
 
  Jonathan Levinson   8/24/200,  11:31:50 AM
The 30 min cycle continues lower on the NQ futures Link , so far delivering solid downside price traction on those bearish divergences noted earlier.

 
 
  Linda Piazza   8/24/200,  11:31:50 AM
The TRAN is back below its 50-dma. At least, I believe it is. Because QCharts frequently does not include all daily bars on the TRAN's chart, I have to revert to a 390-minute chart (390 minutes in a trading day). Averages are close, but not always exactly congruent.

 
 
  Mark Davis   8/24/200,  11:30:47 AM
Day Trade Entry Point Alert -
Go long now... SPX 1095.70, stop 1094.50
If this one fails I'm done for the day

 
 
  Jim Brown   8/24/200,  11:30:28 AM
That last little market bounce came on news that the IRAQ president made a surprise visit to see the IRAN president to seek a peaceful solution to the border crisis.

 
 
  Jonathan Levinson   8/24/200,  11:28:17 AM
Bonds are holding their earlier lows, with TNX currently up 2.5 bps at 4.304%, ditto gold at 408.40, -4.50 on solid volume of 1,271 December '04 e-mini contracts.

 
 
  Jonathan Levinson   8/24/200,  11:25:11 AM
Nymex crude is currently down .225 at 45.825. Chart update at this Link.

 
 
  Jonathan Levinson   8/24/200,  11:23:57 AM
Added a descending resistance line to the 2-day 100-tick QQQ chart. Link . The bearish short cycle trending move continues below 33.95 QQQ.

 
 
  Mark Davis   8/24/200,  11:23:19 AM
Day Trade Exit Point Alert -
Stopped out... SPX 1094.50, -0.84

 
 
  Linda Piazza   8/24/200,  11:21:59 AM
The OEX is now below yesterday's low, but not below 534.

 
 
  Linda Piazza   8/24/200,  11:21:15 AM
The OEX did have five-minute closes below the Keltner line that bears would want to see stop the OEX. Now support is trying to firm near 534.26-534.36, just under the OEX, so that the OEX could attempt another bounce. If it doesn't break through that support soon, it may bounce all the way back to the mid-channel level, currently at 535.45-535.63.

 
 
  Jonathan Levinson   8/24/200,  11:21:05 AM
That break back below 33.90 actually gapped the offer lower by a few cents. Chart coming right up. Link

 
 
  Jonathan Levinson   8/24/200,  11:20:22 AM
If the current low of 33.85 breaks, we'll get a trending downside move for the short cycles which are currently maxxed out in oversold. It might be happening here as I type.

 
 
  Mark Davis   8/24/200,  11:19:38 AM
The expected bounce came right at the second retest of yesterdays LOD @ 1094.73 (actual LOD for today was 1094.79), but it's now stalling at the last swing high at 1096.18. If we can take that out we may get some traction to the upside. TRIN and SOX are both looking bearish but SOX did a similar double bounce @ LOD. We need to get going to the upside quickly or this may be a very short play (pardon the unintentional pun)

 
 
  Jonathan Levinson   8/24/200,  11:17:35 AM
There's a bullish divergence on the wavelet oscillator for QQQ, suggesting that a new short cycle upphase is building. Once again, an upside break of 34.00-34.05 is the minimum level from which to be thinking even short cycle bullish thoughts, as the 30 min cycle channel is still sloping steeply downward.

 
 
  Jeff Bailey   8/24/200,  11:11:26 AM
11:00 Internals at this Link

 
 
  Linda Piazza   8/24/200,  11:09:23 AM
The OEX has not yet confirmed its break out of the channel depicted in the chart linked to my 10:03 post by moving below either yesterday's low or 534. Bears would like to see that happen, but it appears the bounce up to test broken support may occur first.

 
 
  Linda Piazza   8/24/200,  11:08:03 AM
Mid-channel Keltner resistance tightens, now from 535.65-535.76, but bears would really prefer five-minute closes beneath the Keltner line currently at 535.10.

 
 
  Mark Davis   8/24/200,  11:07:33 AM
Day Trade Entry Point Alert -
Go long now... SPX 1095.34, stop 1094.50

 
 
  Jonathan Levinson   8/24/200,  11:06:55 AM
Session low for INTC and QQQ just printed on a break of 33.90. Next support is 33.80, below which we should get a retest of 33.64 and possibly 33.38-44 support.

 
 
  Jeff Bailey   8/24/200,  11:03:53 AM
11:00 Market Watch at this Link

 
 
  Jonathan Levinson   8/24/200,  10:57:30 AM
The short cycle TRIX oscillator is looking particularly oversold here, and the current wavelet bounce is beginning to persuade me of the short cycle's potential strength against the 30 min downphase in progress on QQQ. However, it will take a break above 34.00 and 34.10 to get things rolling to the upside, and the entire range from 34 to 34.10 is now confluence resistance.

 
 
  Mark Davis   8/24/200,  10:52:53 AM
This is a scary looking decline. Price has simply walked down the lower b-band on the 1-min SPX chart since the housing numbers came out. Yesterday's low @ 1094.87 should provide a bounce and it appears we're getting that bounce right now, but oscillators aren't even approaching oversold levels yet.

 
 
  Linda Piazza   8/24/200,  10:51:55 AM
The OEX hit the Keltner channel line that usually stops it to the downside and now turns up to test gathering resistance in the mid-channel level, a to-be-expected event. That resistance gathers from 535.40-536.00, but bearish traders would most like to see five-minute closes beneath the channel line currently at 535.40.

 
 
  Linda Piazza   8/24/200,  10:50:10 AM
Subscriber T.G., a trader who keeps up-to-date on all kinds of developments, sends this helpful link for those who want to follow developments in crude: Link Thanks, T.G.

 
 
  Jonathan Levinson   8/24/200,  10:49:47 AM
Former support at 34.00 should now act as resistance on the current wavelet bounce. If it breaks, look for a move to 34.06 to test the short cycle downphase.

 
 
  Jeff Bailey   8/24/200,  10:46:49 AM
TRIN 1.22

 
 
  Jonathan Levinson   8/24/200,  10:45:40 AM
Next support is 33.90-.92, which lines up with 60 min channel support and price confluence at former resistance. The 30 min channel is rolling here on QQQ, suggesting that this level as well as 33.80 support will be tested. The short cycle, however, is now oversold, and could generate either chop or a bounce- the question is whether it will begin trending under the higher volume breakdown in the longer cycles. My guess is that it will. Link

 
 
  Jeff Bailey   8/24/200,  10:45:23 AM
Day trade short alert ..... for Dollar Tree Stores (DLTR) $25.07 +1.33% .... short at the bid to a $25.00 limit, stop $25.42, target $24.51.

 
 
  Linda Piazza   8/24/200,  10:45:05 AM
The OEX has broken out of the rising regression channel depicted on the chart linked to my 10:03 post. Traders should wait for a move below yesterday's low or perhaps even below 534 as confirmation. What bears do not want to see now is a prolonged period of sideways trading as that sometimes precedes a bounce up to follow the underside of the rising channel.

 
 
  Linda Piazza   8/24/200,  10:42:30 AM
I've talked some about the correlative-fan theory lately, about how important the third trendline break off a rally can be. Here's an example from the SOX: Link We should also be watching this in reverse, watching for the third upside break above a trendline off a move lower, as a sign that the decline is ending.

 
 
  Jonathan Levinson   8/24/200,  10:39:50 AM
QQQ update at this Link . The bounce came from 33.98, right on 30 min channel support. But volume is declining on the bounce, and I have no confidence that it will hold.

 
 
  Linda Piazza   8/24/200,  10:36:25 AM
The OEX now approaches the Keltner line that usually stops it to the downside, with that Keltner line at 534.58. A brief piercing of that line wouldn't necessarily break the support as long as the OEX had five-minute closes back above it or at it. A breaking of that support line suggests a downside target of 532.64. As I type, however, the OEX is showing some tentative bullish divergence, Keltner style, on the five-minute chart, so it may be that the bounce up to gathering resistance near 535.70-536 will occur first.

 
 
  Jeff Bailey   8/24/200,  10:35:55 AM
TRIN 1.07

 
 
  Jeff Bailey   8/24/200,  10:35:20 AM
SOX.X 328.73 -1.9% ... session low and DAILY S2.

QQQ $34.01 -0.23%.

 
 
  Jonathan Levinson   8/24/200,  10:34:27 AM
Session low for NQ futures here at 1369, just now losing 1370 support. Ditto ES below 1096. QQQ is testing 30 min channel support now at 34.

 
 
  Linda Piazza   8/24/200,  10:33:51 AM
No OEX bounce so far. Keltner resistance now builds overhead from 535.74-536.17, and bears want to see five-minute closes beneath that line currently at 536.17.

 
 
  Jeff Bailey   8/24/200,  10:33:39 AM
Day trade short alert ..... for Microsoft (MSFT) $27.27 +0.11% ... at the bid, stop $27.44, target $27.03.

 
 
  Jonathan Levinson   8/24/200,  10:31:23 AM
Rising 30 min channel support for QQQ is up to 33.99 currently, while 60 min support is at 33.94. Channel resistance is up to 34.40, which lines up with confluence resistance discussed yesterday. The break of 34.10 occurring as I type has stalled the short cycle upphase in progress, but it will take a move below 33.99 to get a new downphase started. This is an extremely whippy area, with the short cycle and 30 minute cycles fighting for direction.

 
 
  Linda Piazza   8/24/200,  10:29:20 AM
The OEX hits possible mid-channel support. On any bounce, bears want five-minute closes beneath the channel line currently at 536.35.

 
 
  Jeff Bailey   8/24/200,  10:28:58 AM
Bullish day trade cancel alert ... for the QQQ. Cancel bullish entry QQQ $34.13

 
 
  Jeff Bailey   8/24/200,  10:28:15 AM
TRIN 1.04

 
 
  Jeff Bailey   8/24/200,  10:26:26 AM
SOX.X 384.93 -1.32% .... looks destined for DAILY S2 (382.74).

QQQ $34.14 +0.14% ...

 
 
  Mark Davis   8/24/200,  10:25:34 AM
Day Trade Exit Point Alert -
Stopped out... SPX 1098.06, +1.00

 
 
  Jeff Bailey   8/24/200,  10:24:21 AM
VIX.X 15.56 -2.01% .... edges below DAILY S1 15.59.

 
 
  Mark Davis   8/24/200,  10:22:25 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPX 1097.06, to 1098.06
If we're going to break down here let's at least grab a point

 
 
  Linda Piazza   8/24/200,  10:21:52 AM
The OEX is turned back again at the midline of the regression channel shown on the 30-minute chart linked to my 10:03 post. MACD threatens to make a bullish cross above the trendline drawn on that chart, while RSI threatens the opposite: to turn down along a descending trendline off its highs since 8/18. Mixed signals. Can't we get a day when all works together? I still think this might be a good level for a bearish OEX entry, as long as one understands the risk of an abrupt move up to 540-541, too. Something doesn't feel quite right in here, so only those who are willing to take that risk or the risk of interminable choppiness should consider bearish entries. Note: the OEX dropped toward the mid-channel support as I typed, with that support at 535.80, and a possible bounce point. Next resistance looks like 536.53 or 537.28-537.61. TRIN rises.

 
 
  Mark Davis   8/24/200,  10:19:37 AM
SOX just made a new LOD... this is not good for bulls

 
 
  Jeff Bailey   8/24/200,  10:18:56 AM
10:15 Market Watch at this Link

 
 
  Linda Piazza   8/24/200,  10:14:31 AM
The TRAN broke momentarily above 3100, but is back below it now, after having touched the descending trendline off the 7/01 high. I still think the TRAN might be a key index to watch with regard to that descending trendline and the 3100 level.

 
 
  Jonathan Levinson   8/24/200,  10:13:08 AM
QQQ chart update at this Link.

 
 
  Jeff Bailey   8/24/200,  10:12:53 AM
10:00 Internals at this Link

Yesterday's Internals at this Link

 
 
  Linda Piazza   8/24/200,  10:12:34 AM
The OEX is pushing up into fifteen-minute Keltner resistance, but the Keltner lines are still rising, so it's not clear whether they'll stop the OEX. On the five-minute chart, the OEX is back at the channel line that usually stops it, but a five-minute close above that channel line, currently at 537.54, would set up a higher target, near 538.73. Right now, the five-minute chart continues to show bearish divergence, Keltner style, while the fifteen-minute one's outlook is less clear, but still showing tentative bearish divergence, Keltner style.

 
 
  Jonathan Levinson   8/24/200,  10:11:14 AM
Session high for NQ futures here. QQQ's 30 min channel resistance now lines up with 60 min resistance at 34.36.

 
 
  Jonathan Levinson   8/24/200,  10:10:31 AM
A 6.5B overnight repo results in a net 1.75B drain against the 8.25B expiring. This is a relatively small net amount compared with what we've seen recently.

 
 
  Mark Davis   8/24/200,  10:06:05 AM
Now we'll find out what this market is made of. We have the disappointing housing numbers as a great excuse to sell off. If the market can shake these numbers off and break out above SPX 1100 I would consider that a pretty bullish move.

 
 
  Linda Piazza   8/24/200,  10:03:43 AM
So far, this chart is beginning to look more bearish to me, too, except for MACD's attempt to print a bullish cross above its trendline: Link Be wary of a "breakdown," though, that does nothing but move sideways prior to a move higher along the underside of the channel.

 
 
  Jim Brown   8/24/200,  10:03:28 AM
GOOG -2 for the day and -4 points off its opening high.

 
 
  Jeff Bailey   8/24/200,  10:00:38 AM
Bullish day trade setup alert .... for the QQQ $34.21 +0.12 .... go long on pullback at $34.10, stop $33.99, target $34.42.

 
 
  Jim Brown   8/24/200,  10:00:10 AM
Existing Home Sales for July = 6.72M (-2.9%)

 
 
  Linda Piazza   8/24/200,  9:58:59 AM
The OEX turned up again just ahead of that Keltner support, a sign of strength, usually. If you read my OEX-related post last night, though, you know that because of historical patterns, I'm wary that we might be caught in chop for a week or two, and I'm especially wary of that when I see mixed signals, which many other writers are pointing out. That says to me that no one--including the big boys and girls responsible for enough volume to create the breadth indicators we watch--knows for sure what's going to happen. Again, I think this 537-ish zone should be strong enough to stop the OEX, but there are conflicting signs that it could push up to 540-541, too. I'm seeing Keltner-style bearish divergences, but we've seen some puzzling behavior of the type we sometimes see when markets are being supported and higher is the direction, no matter what charts say. I sure will be interested to read Jonathan's post about the Fed infusion or lack of infusion of cash, too, as that's been a helpful indicator lately.

 
 
  Mark Davis   8/24/200,  9:57:32 AM
The fur is really flying as bulls and bears slug it out on the 50 yard line

 
 
  Mark Davis   8/24/200,  9:54:35 AM
Day Trade Exit Point Alert -
Cinch up your stops... SPX 1097.06, to 1097.06 and break even

 
 
  Jeff Bailey   8/24/200,  9:53:07 AM
Current OPEN MM Profiles at this Link

 
 
  Jonathan Levinson   8/24/200,  9:51:27 AM
QQQ 100-tick chart updated at this Link.

 
 
  Jonathan Levinson   8/24/200,  9:50:10 AM
Nymex crude oil updated chart at this Link.

 
 
  Jeff Bailey   8/24/200,  9:49:26 AM
Semiconductor Index (SOX.X) 388.92 -0.29% ....

QQQ $34.18 +0.26% ....

 
 
  Jonathan Levinson   8/24/200,  9:48:31 AM
The Fed's open market desk has 8.25B in overnight repos expiring today. We await the 10AM announcement to see whether there will be a net addition or drain. As well, we get the existing home sales data at 10AM, est. 6.81M.

 
 
  Linda Piazza   8/24/200,  9:48:08 AM
The OEX looks as if it's going to head right back down and test that 535.63-536.04 Keltner support. If that fails, a test of 534.58 might be in order, with a test of 533 next, if that support fails.

 
 
  Jeff Bailey   8/24/200,  9:45:17 AM
TRIN 0.72 .... (DAILY Pivots shown in last night's Index Trader Wrap match those of QCharts today).

 
 
  Jonathan Levinson   8/24/200,  9:43:49 AM
Bonds remain weak, with TNX up 2.4 bps at 4.303%, as does gold, with Dec. gold futures down 3.50 to 409.40. Next support is 408, followed by 405. HUI is down 1.38% at 202.02, XAU down .88% at 92.97.

 
 
  Linda Piazza   8/24/200,  9:41:55 AM
The OEX moved a little past the 537.17 level that marked the Keltner channel line that usually stops it, but closed the five-minute period at that line and now turns down below it. Unlike some other indices, the OEX has not yet matched yesterday's high before it was turned down again. We're still in the zone that I think should be tough resistance for the OEX, but I can't preclude a push up to 540-541, either. The BIX is higher, although not above yesterday's high. The TRAN is higher, although far from yesterday's high and not yet challenging 3100. The SOX lingers near yesterday's close, but semi-related stocks performed pretty well, if on low volume, in Asian and European trading. It all looks tentative to me, but I sure am leery of suggesting bearish trades with a TRIN at 0.65.

 
 
  Jonathan Levinson   8/24/200,  9:41:41 AM
I'd look for a move back below 34.10 QQQ to stall out the current 30 min cycle upphase trying to build. This current zone between 34.10 and 34.30 is a chop zone in which both the 30 min and short cycles are searching for direction.

 
 
  Jonathan Levinson   8/24/200,  9:36:44 AM
On the NQ futures (proxy for QQQ using premarket data) the 30 min cycle has whipsawed to the upside. 30 min channel resistance rises to 34.32, support to 33.92. A short cycle upphase is trying to get started with the downphase now stalled.

 
 
  Linda Piazza   8/24/200,  9:36:37 AM
The TRAN again moves higher this morning, but hasn't yet challenged 3100 again.

 
 
  Linda Piazza   8/24/200,  9:33:26 AM
The OEX shot past that trying-to-firm Keltner resistance at the open. Unless the OEX is slapped back immediately, something that doesn't appear to be happening as I type, that should-have-been resistance will firm up as support instead. Just above 537, the OEX approaches a Keltner line that often turns it back.

 
 
  Linda Piazza   8/24/200,  9:31:01 AM
Well, I took so long making up my mind that the OEX has already opened, but here's what I was thinking: With futures higher this morning, it's possible that the OEX may first test resistance trying to gather near 535.56-535.82. A gap above that level would turn those Keltner lines into possible support lines and a strong thrust through them near the open would do the same, with resistance lines then much thinner above that level. A tentative climb is going to give them time to firm up, however. The 15-minute chart suggests that as long as the OEX has 15-minute closes beneath the Keltner line currently at 535.61, it's maintaining a possible downside target of 533.25 or so. That support still climbs. Both the five- and fifteen-minute Keltner charts show bearish divergence, Keltner style, but it's possible that a dip to central support on the 15-minute chart won't be much of a dip, because the central channel lines continue climbing. A breakdown below the central Keltner channel would be more serious.

 
 
  Mark Davis   8/24/200,  9:30:18 AM
Day Trade Entry Point Alert -
Go long now... SPX 1097.06, stop 1094.50

 
 
  Keene Little   8/24/200,  9:29:27 AM
Mark, I know what you mean about these distribution patterns. It could be considered a consolidation pattern in which case price will continue in the direction it entered the pattern, as you and Linda have been discussing. Could get interesting right here.

BTW, hit return after your link on your post so that the link works correctly (I know this because I had the same problem with my posts).

 
 
  Mark Davis   8/24/200,  9:27:18 AM
Potential Day Trade Setup Alert -
I'm going to issue a long signal for SPX at the bell... I would suggest using SPTIA (SPX Sept 1105 call)

 
 
  Mark Davis   8/24/200,  9:22:23 AM
Keene this is an old chart that looks at "b" distribution patterns, more specifically the two previous "b" distribution patterns which are most similar the one we are currently in, or possibly coming out of. Link
I've been thinking since we blasted off the bottom of the bulb that the market may go much higher than SPX 1100, which is just "too perfect" as a short setup and makes me suspicious. I can redraw the chart to bring it up to date but wanted to get it up before the market opens.

 
 
  Jonathan Levinson   8/24/200,  9:16:19 AM
Need to step away for 30 minutes. I will be back after the open.

 
 
  Jonathan Levinson   8/24/200,  8:53:03 AM
Aug. 24 (Bloomberg) -- A $350 billion pension shortfall among U.S. companies may force the federal agency that insures retirement plans to seek a taxpayer bailout similar to the one during the savings and loan crisis, according to the Cato Institute, a Washington-based policy research group.

The federal agency, the Pension Benefit Guaranty Corp. had a record deficit of $11.2 billion last year after taking over plans for 152 companies such as Bethlehem Steel Corp. and US Airways Group Inc. Without changes to funding and premium rules, the PBGC's deficit is likely to swell to $18 billion in the next 10 years, and may reach more than $50 billion, said Richard A. Ippolito, chief economist at Cato.

"If exposures create claims that reach catastrophic levels, taxpayers will be called upon to provide a bailout," Ippolito said.

Link

 
 
  Jonathan Levinson   8/24/200,  8:39:25 AM
QQQ is higher now, currently 34.23, +.13, while gold and treasuries are lower. It appears that equities are trading higher with the USD Index. Actually, the USD Index, gold, treasury yields, and equities are all following their respective daily cycles: USD up, TNX up, equities up, gold down.

 
 
  Jonathan Levinson   8/24/200,  8:34:14 AM
Nymex crude oil futures at this Link.

 
 
  Jonathan Levinson   8/24/200,  8:20:17 AM
A break above 34.25-34.30 should be enough to turn the 30 min channel from down to up, and would threaten the upper rising bear wedge resistance line as well. Bulls should be out of the woods if they can generate a 30 min candle above the 34.30 level. Next resistance above would be 34.40-.44 QQQ.

 
 
  Jonathan Levinson   8/24/200,  8:17:33 AM
The Naz futures 30-min chart is showing negative divergences within what appears to be a bear wedge: Link . This is in the context of the ongoing daily cycle upphase. The lower support line at 1370 NQ lines up with 33.90 QQQ, a break below which brings in an implied target as low as 1302 NQ / 32.40 QQQ. A break to those lows would threaten and probably abort the daily cycle upphase were it to occur, but the first test is a break of 1370 / 33.90 on strong/expanding volume. That 33.90 QQQ level conveniently lines up with the lower channel support line of what is so far proving to be a merely corrective 30 min cycle downphase.

 
 
  Jonathan Levinson   8/24/200,  8:01:18 AM
Equities are higher this AM, with ES trading 1099.75, NQ 1376, ES 10108 and QQQ up .09 to 34.19. Gold is down 2.90 to 410, silver -.05 to 6.69, ten year treasuries down .14 to 112.25, and crude oil -.125 to 45.925.

We await the 10AM release of Existing Home Sales for July, est. 6.81M, down from June's 6.95M.

 
 
  Linda Piazza   8/24/200,  6:52:55 AM
Good morning. The Nikkei made another assault on 11,000 in early trading Tuesday morning, achieving a slightly higher high than Monday's within a few minutes of the open. That slightly higher high was to be the head of a H&S formation, however, and the Nikkei then spent a great part of the day trading in the red, making it back into positive territory before the close. The Nikkei closed higher by 24.36 points or 0.22%, at 10.985.33.

The banking sector was touted as being responsible for the afternoon climb, as market watchers anticipated that Sumitomo Mitsui would announce the terms of its bid for UFJ Holdings. That speculation sent banking stock higher after early losses. After the close, Sumitomo Mitsui proposed a 1-to-1 merger. In a climate of retreating crude prices, auto manufacturers and techs gained, with computer-related stocks performing especially well. Announcing plans to raise production capacity and a price hike in the 2005 Prius hybrid, Toyota Motor led car manufacturers higher. Although Wal-Mart suffered a tough day Monday on U.S. bourses, the company's possible interest in struggling Japanese retailer Daiei was enough to send Daiei higher by 8.2%. Yesterday it had looked as if the company might not be able to avoid a bailout by the state-run IRC, with three creditors refusing to accept Daiei's own restructuring plan, and with Daiei plunging 24.2%.

Other Asian markets were mixed, although the ones typically followed on this page all closed in the green. The Taiwan Weighted gained 0.68%, and South Korea's Kospi gained 0.60%. Singapore's Straits Times gained 0.22%. Hong Kong's July consumer prices rose 0.9% from the year-ago level, signaling that Hong Kong's long period of deflation may be ending, and the Hang Seng climbed 1.73%. After approaching the bottom of its 1,300-1,800 long-time range yesterday and then coming within a point or two of the low of that consolidation pattern today, China's Shanghai Composite posted gains of 1.45%.

Currently, European bourses are mixed, too, but the ones commonly followed on this page are flattish to higher. Declining oil prices helped car and tire manufacturers, but techs have reportedly had spotty performance. Infineon's CEO stated that the U.S. chip market may grow 25-30% by 2006, but not by 2004. Infineon and STMicroelectronics both gained in early trading. After the bell, SAP announced a deal with the U.S. Postal Service, with Peoplesoft perhaps passed over, some speculated, because of uncertainty about Oracle's bid for Peoplesoft. In the U.K., potential bank mergers are in the news, as they are in Japan, with HBOS this morning saying that it would make an offer for Abbey National, countering Banco Santander's offer. CNBC Europe released that news, with that news not yet confirmed by print articles. Banks were higher on the speculation that offer might be made. Luxury goods makers performed well, although Swatch Group saw only slightly higher prices after its earnings announcement. Swatch saw European consumer behavior as stable and slightly improving.

As of this writing, the FTSE 100 was higher by 7.60 points or 0.17%, at 4,412.90. The CAC 40 was higher by 10.33 points or 0.29%, just testing the 3,600 level, at 3,600.02. The DAX was higher by 20.63 points or 0.55%, at 3,792.77.

 
 
  Linda Piazza   8/23/200,  9:31:31 PM
Monday, the OEX printed a small-bodied candle at resistance. The day's action hooked daily RSI lower, and turned 30- and 60-minute RSI down, too. On both a daily Keltner and bar chart, the OEX appears to be trying to make it up to test 540-541 resistance, with the OEX's 50-dma at that level along with Keltner and historic resistance. I'm not sure it's going to make it up there, however, as the 535-537 resistance band may be too much for the OEX, and the other indicator indices we've been watching present a mixed picture. The TRAN, Russell 2000, and BIX all turned down, but the SOX squeaked by with a close only cents above 390, although off the high of the day. So far, the OEX has been completing daily closes below a Keltner line currently at 536.14, not quite able to make it up to the mid-channel level on the daily Keltner chart.

As I and others mentioned in this weekend's newsletter, the OEX and some other indices completed beautifully formed morning-star patterns on their weekly charts. While trading in the current descending regression channel on the daily chart, the OEX has tended to form those morning-star patterns, or patterns similar to that reversal pattern, as it hits the bottom of the descending regression channel. When it did so in late March, it then spent three more weeks consolidating while the channel line came down to meet it, rather than climbing to meet that channel line. I hope we're not in for three weeks of consolidation now, but it's possible.

Next somewhat firm support is in the 533.80-534. Resistance is trying to firm near 535.50-536. The current fifteen-minute pattern could be a bear flag. If so, the OEX is likely to turn down below that trying-to-gather resistance. A break of the Keltner channel line now near 534.66 would set up a possible test of 532.80-533.

Here's a more traditional look at the OEX's 30-minute pattern: Link Notice the H&S-like formation on the MACD on this 30-minute chart. A break of the MACD neckline simultaneous with or shortly after a break out of the ascending regression channel would confirm that breakdown, while a bullish MACD cross at the trendline would tend to confirm an attempt to move back up through the channel. The MACD formation was easier to pick out than the more-jittery RSI one, but RSI tends to lead while MACD tends to be late, so perhaps watch RSI, too. Use a break of 534 to confirm the breakdown out of the channel. On this chart, support below 534 looks strongest at 530-531, but RSI suggests at least a bounce attempt from higher, near 533, and 533 also shows up as potential strong support on the daily chart, with the 30-dma also located at that level. Any considering or already in bearish positions should be aware of bounce potential in that area.

I'm still worried about getting caught in the chop right now, as I think some indices are still pulling in different directions. Watch the SOX, TRAN, Russell 2000, and BIX, among other indices, for a sense of whether these indicator indices are moving in the same direction or are opposing each other. Since I still feel that upside might be limited, I'm especially leery of long plays, at least ahead of the market open, until we see what breadth indicators look like.

 
 
  OI Technical Staff   8/23/200,  6:27:07 PM
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