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  Jim Brown   9/2/2004,  5:22:48 PM
Mid Quarter Update: ALTR = Lowered Rev est to $269M, (prior guidance Rev est $277M, earnings +0.19)

  Jeff Bailey   9/2/2004,  5:04:18 PM
Intel (INTC) $21.62 +0.88% .... after-hours low so far has been $19.57, stock edging up at $20.10 here.

  Jeff Bailey   9/2/2004,  4:58:18 PM
Microsoft (MSFT) $27.62 +0.83% .... trades $27.30 in extended session.

  Jeff Bailey   9/2/2004,  4:53:37 PM
QQQ bearish speculator's alert .... this afternoon there was a "bad tick" in the QQQ to $34.47 at approximately 3:25 PM EDT.

QQQ trading $34.47 here in after-hours.

If you were/are a short-term speculator on bearish Intel (INTC) reaction, this might be the place to lock in some gains.

Quick tabulation of tomorrow's DAILY pivots are ... $33.89, $34.33, Piv=$34.61, $35.05, $35.33.

  Jeff Bailey   9/2/2004,  4:42:15 PM
Current OPEN MM Profiles at this Link

Today's Activity

Stopped out of the carryover Semiconductor HOLDRs (SMH) day trade short at $29.70. ($-0.10, or -0.34%)

Day trade long Wal-Mart (WMT) at $52.39, closed at bullish target of $52.80 ($0.41, or +0.78%)

Day trade long General Electric (GE) at $32.99, closed at $33.14 as stock hit target of $33.15 just prior to close. ($0.15, or +0.45%)

Initiating a STOP on 2 of the Netease.com (NTES) ... Dec. $30 puts ahead of tomorrow's nonfarm report. Will close out 2 IF the underlying stock of NTES trades $37.65.

I will be out of the office starting tomorrow at 04:00 PM EDT until the opening of trade on Tuesday 09/14/04.

I will develop and post other IF, THEN, ELSE trade instructions for other open positions prior to tomorrow's close.

  Jeff Bailey   9/2/2004,  4:26:00 PM
JDS Uniphase (JDSU) $3.13 -0.08% .... lower at $3.08.

  Mark Davis   9/2/2004,  4:25:12 PM
The skeptical side of me has been expecting "them" to run the indices up just until the all-clear signal is sounded before pulling the rug. Today was a great start, and possibly finish. The "bad" INTC numbers are just out. Now we find out how much has already been priced in with all the recent negative INTC press. INTC is tanking hard in AH trading, currently printing 19.75, -7.84%, after closing the day @ 21.62... quite a drop and at first glance it appears the bad news was not all priced in. If prices continue to hold at lower levels this will set the stage for a lower open and bears will wish they had shorted the close. (I hope bulls took their 1/2 profits, if not full profits, at the close).

  Jeff Bailey   9/2/2004,  4:24:54 PM
Semiconductor HOLDRs (SMH) $29.99 ... lower at..... $29.10.

  Jeff Bailey   9/2/2004,  4:24:07 PM
Intel (INTC) $21.69 .... sharply lower at $19.78.

  Jim Brown   9/2/2004,  4:19:12 PM
Text of Intel's update: Link

  Jonathan Levinson   9/2/2004,  4:17:28 PM
Still dropping: Link

  Jonathan Levinson   9/2/2004,  4:16:42 PM
QQQ drops to 34.52.

  Jim Brown   9/2/2004,  4:15:59 PM
Mid Quarter Update Alert:

INTC = $8.3-$8.6B, Margins 58%. Products selling below expectations. (prior guidance Rev est $8.9B, margins 60%, earnings +0.30)

ALTR = Lowered Rev est to $269M, (prior guidance Rev est $277M, earnings +0.19)

TXN = Rescheduled to 9/8, (prior guidance Rev est $3.32B, earnings +0.27)

IDTI warned after the bell

  Jeff Bailey   9/2/2004,  4:05:31 PM
Intel (INTC) went out at $21.62 +0.88%. Just at yesterday's highs.

Semiconductor HOLDRs (SMH) went out at $29.99 +1.48%, just at yesterday's highs.

  Mark Davis   9/2/2004,  4:05:16 PM
Have a great weekend Keene!

  Mark Davis   9/2/2004,  4:01:42 PM
An interesting side note... Dow, OEX and SPX closed very close to HOD... not the case with NDX, which closed nearly 4 points off HOD

  Jonathan Levinson   9/2/2004,  3:58:05 PM
A short cycle downphase is just getting started now on the sideways drift, or more accurately, the short cycle upphase has stalled. I'd still prefer to see a break back below 34.70 support before looking for even a short term downward bias.

  Linda Piazza   9/2/2004,  3:57:33 PM
The OEX looks as if it will end the day just under its 200-sma.

  Mark Davis   9/2/2004,  3:54:26 PM
Taking 1/2 profits on bullish positions might not be a bad idea before the close. GREED is just as much an enemy as FEAR. Once you take profits they can't take them back.
... an additional thought, volatility premiums on calls are greatly inflated right now. That may not be the case tomorrow.

  Linda Piazza   9/2/2004,  3:54:15 PM
The OEX's 15-minute Keltner chart shows first support from 543.39-543.49, roughly analogous to the first support shown on the five-minute chart. The five-minute chart shows that support could be tenuous, though.

  Jeff Bailey   9/2/2004,  3:52:47 PM
Bullish day trade target alert .... GE $33.14 here. Let it go. Traded $33.15 offer.

  Linda Piazza   9/2/2004,  3:47:22 PM
If you're going to close a bullish OEX position ahead of the close, consider whether you might want to do that soon, especially if the OEX does not achieve a new high now. The OEX is achieving five-minute closes just where bulls would want in order to see it continue to climb, above the Keltner line currently at 543.51, but some market participants with profits might soon start bailing, and you don't want to let profits go if that happens. Strongest support appears to be near 542.14, although there's intervening support at that other Keltner line I mentioned and also at 542.91.

  Jim Brown   9/2/2004,  3:44:48 PM
It is going to be a big night for chips with these mid quarter updates tonight after the bell:


  Mark Davis   9/2/2004,  3:43:25 PM
MOC orders weighted to sell side (not a surprise)
Benchmarking SPX = 1117.25
I just want to see if the MOC orders are another bear trap (which I suspect)

  Linda Piazza   9/2/2004,  3:43:03 PM
In last night's wrap, I paid some attention to the Russell 2000's daily chart. The Russell 2000 had been one of the first of the indices to approach the appropriate level for a rolldown from a horizontal neckline into another shoulder for an inverse H&S. Yet it had formed a congestion zone so long that the rolldown-into-a-shoulder scenario could no longer be given preference over the just-go-ahead-and-climb one. Horizontal resistance near 551.75-552 had proven important, as had the 50-dma, with yesterday's candle body forming mostly under that moving average even after yesterday's spike. I had wondered if the Russell 2000 had been forming a blunted right shoulder instead of pulling back to form a deeper one, and its increasingly volatile trading pattern suggested it would soon break out one direction or the other. After yesterday's fat-finger trade, perhaps we should have guessed that the breakout would be to the upside. I'm going to consider that formation a confirmed inverse H&S now, but that doesn't necessarily mean that I expect it to reach its upside target. The Russell 2000 is getting stopped today by its 100-sma, and 565-566 resistance and the 200-sma lie just ahead. I would expect a pullback from that level, if not before, and I think it's the depth of that pullback that will give us the information we need. I'm a little suspicious when indices don't do the work they need to do, and the Russell 2000 didn't, as it didn't really pull back into the needed right shoulder. Sometimes when indices take shortcuts, they have to go back and do it all over again. We'll see.

  Jonathan Levinson   9/2/2004,  3:41:16 PM
The current drop is registering so far as a wavelet downphase on QQQ, but it will take a break back below 34.70 to give us our first short cycle sell signals.

  Jeff Bailey   9/2/2004,  3:40:40 PM
QQQ $34.74 +1.37% ... fading a bit after session high of $34.88 came within a penny of WEEKLY R1.

Bears have to be thinking Intel (INTC) has some "bad news" after the bell.

  Jeff Bailey   9/2/2004,  3:39:31 PM
General Electric (GE) $33.08 +0.57% .... should close at a session high. Intra-day chart at this Link

INDU 10,280.77 +1.10% ... tight little pennant "p" on 5-minute chart.

  Mark Davis   9/2/2004,  3:39:07 PM
The bias for MOC orders will probably be meaningless today as an indicator (JMESHO)

  Jonathan Levinson   9/2/2004,  3:33:54 PM
Evening session low for Nymex crude oil here at 43.95, down .10.

  Linda Piazza   9/2/2004,  3:31:10 PM
OEX bulls would like to see the OEX produce five-minute closes above the Keltner line currently at 542.96 into the close, although in that instance, that Keltner line would be rising, too. Firmer support is from 541.65-542.20, so it's possible that the OEX could be vulnerable down to that level, at least, into the close.

  James Brown   9/2/2004,  3:30:42 PM
Dow-component MMM is cracking the $83.00 level after yesterday's breakout over the simple 200-dma. The rally is now in its third week here and shares are nearing resistance at $84 and its simple 50-dma.

  Linda Piazza   9/2/2004,  3:29:00 PM
I'm glad I posted this OEX chart in my 11:32 post earlier today for those brave enough to take a long trade on an upside breakout Link but sorry that I discouraged those considering such a trade. I'm not too sorry, though, because although I've been acknowledging today that a short squeeze could produce a big gain, that was always a risky trade ahead of the Intel report and as the SPX tested its 200-sma.

Now, I have to note that the OEX has violated its five-minute Keltner channel to the upside to a bigger degree than I've seen in a long, long time. That shows the danger to bulls, especially ahead of the Intel update this evening, so make up your minds soon if you want to take profits or let it run.

  Jeff Bailey   9/2/2004,  3:28:23 PM
Intel (INTC) $21.67 +1.11% .... DAILY R1 $21.70 and WEEKLY S1 $21.76.

33-minute to the close, but going to be difficult to see a close at $21.15.

  James Brown   9/2/2004,  3:27:20 PM
CAH was on the watch list last night for a potential "fill the gap" play. The stock is up another 3.8% today and pushing through its simple 40-dma. While bulls are probably targeting the $50.00 mark watch out for the simple 50-dma near $49.

  Jonathan Levinson   9/2/2004,  3:26:00 PM
The daily QQQ chart has bollinger resistance at 35.05. 34.60-.70 is now support. This whipsaw didn't last as long as the last bull trap did back at the beginning of August, but it's close. Provided that INTC doesn't drop a bunker buster tonight, the daily cycle upphase will be restored with a close at current levels.

  Jeff Bailey   9/2/2004,  3:25:39 PM
Taser Intl. (TASR) $31.69 +14.19% .... that little pullback found buyers right at its WEEKLY R2 of $31.15.

  Jeff Bailey   9/2/2004,  3:23:56 PM
Bullish day trade raise stop alert .... for General Electric (GE) $33.09 +0.63% .... to $32.95.

  James Brown   9/2/2004,  3:23:30 PM
A few days ago we mentioned the breakout in oil giant CVX over resistance at $95.00 as a potential entry point for a run toward $100. The stock is now at $99.50 and climbing.

  James Brown   9/2/2004,  3:22:10 PM
European conglomerate Siemens (SI) has broken out above major resistance at $70.00 and its simple 100-dma and exponential 200-dma and its seven-month trend of lower highs.

  Linda Piazza   9/2/2004,  3:21:12 PM
The SPX has broken out of the Keltner channels on both the 15-minute and 30-minute charts. The last breakout on a 30-minute chart was early in June, when the SPX broke above the channel line then at 1136.77, dropped back (probably far enough to stop out the first bulls) and then climbed to a high of 1142.16 before dropping down to 1122. That's just one instance, and for all we know, it could be an aberrant one, but it shows two things: that the SPX continued climbing through several hours (but not that many points) after that breakout, but that it then tumbled hard. The breakout before that, the SPX broke out on a climb above the channel line then at 1140.62 on April 2, climbed to a high of 1144.81, and then fell to 1136.96 before climbing and breaking out again. It achieved a high of 1150.29, with the climb taking two full days after its initial breakout, before tumbling all the way to 1116.03. Similar pattern as the other example. In both instances, the SPX eventually climbed about 6 points above its initial breakout point (after first stopping out most of those entering long on the first breakout) and then tumbled hard. Be careful.

  Mark Davis   9/2/2004,  3:20:31 PM
We're working on the SIXTH bull flag/sideways consolidation on the SPX 1-min chart.

  James Brown   9/2/2004,  3:20:28 PM
you can also add GILD to that list...

  James Brown   9/2/2004,  3:19:51 PM
Hitting new highs and producing potentially tradeworthy breakouts are FAST and PCP...

  James Brown   9/2/2004,  3:17:06 PM
CNBC is reporting that Ralph Acampora sent out a bullish note to clients this afternoon.

  Mark Davis   9/2/2004,  3:15:56 PM
NDX over 1400... amazing

  James Brown   9/2/2004,  3:15:25 PM
The rally is not lost on Apollo Group (APOL). The educator is seeing its stock breakout over its 40, 50 and 200-dma's today. The next challenge is the top of the gap near $83.50.

  Mark Davis   9/2/2004,  3:12:36 PM
TRIN @ .46

  Linda Piazza   9/2/2004,  3:12:27 PM
The OEX hovers just underneath upper Keltner channel resistance, with that line at 543.16. The SPX has broken out above this Keltner line already. OEX bulls who want to see the OEX break out and continue to climb into the close want to see the OEX maintain 15-minute closes above the channel line currently at 542.05, but should recognize that firmer support does not exist until near 540.80-541.20, and the firmness of that support is questionable. If an index is strong, it bounces from the first available support, but the OEX is beginning to outstrip its support.

  Jonathan Levinson   9/2/2004,  3:11:38 PM
Friday's high has now been exceeded, and shorts appear to be covering en masse.

  Jeff Bailey   9/2/2004,  3:11:31 PM
eBay (EBAY) 89.85 +2.53% ... retraces 80.9% of June-July decline.

  Mark Davis   9/2/2004,  3:09:29 PM
We still have almost a full hour of trading... watch out for sharks ^^^^(:o^^^^

  Jonathan Levinson   9/2/2004,  3:07:04 PM
The drop in bonds steepened, with TNX now closed in the cash market up 7.1 bps at 4.194%, a 1.72% increase for the day.

  Linda Piazza   9/2/2004,  3:05:05 PM
The BIX is back above 360, at 361.48 perhaps moving back toward Tuesday's high of 362.29 and then the 3/05 intraday high of 362.64. These could provide resistance, although a move above that 3/05 high would instead be an upside breakout.

  Jeff Bailey   9/2/2004,  3:04:46 PM
03:00 market watch at this Link

Oil nearly unchanged!

  Mark Davis   9/2/2004,  3:04:31 PM
TRIN just printed .54 ... short squeeze, euphoric bulls or both? If you're in a bullish play it's time to start protecting profits.

  James Brown   9/2/2004,  3:03:09 PM
I also had an alarm go off for OSI Pharmaceuticals (OSIP). OSIP is breaking out over resistance at $62.00 and its simple 50-dma. This could be an entry point for a run toward $70.00, although I would keep a wary eye on potential resistance near $65.00.

  Jonathan Levinson   9/2/2004,  3:02:42 PM
Here comes more volume now.

  Jonathan Levinson   9/2/2004,  3:02:01 PM
The price set a new high for the move, but there's been monster volume spike such as I had expected to see for QQQ, and so there's still the possibility that this is just a throwover. Nevertheless, 34.65 should act as support.

  Linda Piazza   9/2/2004,  3:01:56 PM
The TRAN is now above the 8/03 high and above 3150, too, at 3152.26 as I type.

  James Brown   9/2/2004,  3:01:53 PM
I'm seeing National Instruments (NATI) is breaking out (in the last five minutes) above its descending trendline of resistance dating back to April. This looks like a bullish entry point.

  Mark Davis   9/2/2004,  3:01:30 PM
NDX 1400... make that 3 1/2 points away

  Linda Piazza   9/2/2004,  3:00:23 PM
Upper Keltner channel resistance on the OEX's 15-minute chart has now moved up to 543.12.

  Mark Davis   9/2/2004,  2:59:47 PM
We have a runaway freight train here...
Dow 10200... history
SPX 1111... history
Next target... NDX 1400, 5 1/2 points away

  Jeff Bailey   9/2/2004,  2:59:17 PM
Yes Mark it is. My thinking is when shorts decide to cover, all things are possible. Will be VERY interesting to see if TASR can get a close above its 50-day SMA.

  Jeff Bailey   9/2/2004,  2:57:03 PM
Dow Industrials (INDU) 10,241.45 +0.75% ... session high and DAILY R2.

  Jeff Bailey   9/2/2004,  2:54:43 PM
Day trade long alert ... for General Electric (GE) $32.99 here, stop $32.88, target $33.15 by the close. DAILY R1 at $33.03, DAILY R2 is target at $33.15.

SOES bandits only as time running out, not enough intra-day upside to DAILY R2.

  Jeff Bailey   9/2/2004,  2:53:03 PM
Buy Program Premium .... SPX 1,113.95 , QQQ $34.66

  Mark Davis   9/2/2004,  2:52:41 PM
I'm also seeing bearish divergences but the current pullback is taking the same form as the previous two... a bull flag

  Jeff Bailey   9/2/2004,  2:52:30 PM
Good Gravy! .... was looking at a day trade short in Dollar Tree (DLTR) $24.76 +4.82% earlier this morning, but decided not to try and short against the RLX.X strength. Good thing.

  Jonathan Levinson   9/2/2004,  2:51:52 PM
At issue here is last Friday's high. I expect to see a burst of short covering on a break above 34.70, while a double top below it would be an invitation for the sellers to pile on.

  Mark Davis   9/2/2004,  2:49:49 PM
Jeff isn't it amazing? TASR still has the ability to make big moves.

  Mark Davis   9/2/2004,  2:48:47 PM
The SOX has completely reversed its earlier losses... too much negative INTC press?

  Jeff Bailey   9/2/2004,  2:48:12 PM
Taser Intl. (TASR) $31.33 +12.6% .... "reversing" from session high of $32.21.

  Linda Piazza   9/2/2004,  2:47:12 PM
On this pullback, those who are long the OEX want to see the OEX maintain 15-minute closes above the Keltner lines from 540.75-540.98, but will be almost as happy with 15-minute closes above the Keltner line currently at 540.09. Be careful.

  Jonathan Levinson   9/2/2004,  2:44:41 PM
QQQ is printing a new high at 34.64 here. The short cycle is still pointed upward and the 30 and 60 min channels have joined in as well, with overlapping channel resistance right here at 34.64.

  Jeff Bailey   9/2/2004,  2:44:29 PM
Bullish day trade exit alert ... for Wal-Mart (WMT) $52.80.

  Jeff Bailey   9/2/2004,  2:43:58 PM
S&P Retail Index (RLX.X) 399.40 +2.32% ... session high here. QCharts' WEEKLY R2 just ahead at 399.76.

  Linda Piazza   9/2/2004,  2:42:23 PM
The TRAN is at its high of the day, at 3140.96, charging up toward that 8/03 swing high of 3147.23.

  Jeff Bailey   9/2/2004,  2:41:36 PM
October Crude (cl04v) $44.25 +0.68% (30-min. delayed) ... did test WEEKLY Pivot of $44.10.

  Jeff Bailey   9/2/2004,  2:37:27 PM
Research in Motion (RIMM) $63.00 +3.75% Link .... gets the 3-box reversal back higher.

  Linda Piazza   9/2/2004,  2:37:21 PM
The SPX pulls back from upper Keltner-channel resistance. Those who want to see the SPX continue to move higher want to see it find support on the Keltner line currently at 1111.04 on any pullbacks, but will find cheer from 15-minute closes above 1109.72, too.

Be aware that we're seeing bearish price/MACD divergence here, but also be aware that this divergence can continue while price just keeps climbing.

  Jeff Bailey   9/2/2004,  2:35:55 PM
S&P Banks (BIX.X) 360.80 +0.35% .... pretty good move for the banks in last 20-minutes. Session highs here.

  James Brown   9/2/2004,  2:35:42 PM
Same Store Sales for August

PLCE +21.0%
GADZQ +17.3%
NMG +14.7%
WAG +9.7%
BEBE +9.2%
WLSN +9.0%
STGS +8.1%
JWN +7.2%
CLE +7.0%
BKE +6.7%
JOSB +6.4%
GES +5.9%
MIK +5.0%
BJ +4.5%
TJX +4.0%
JCP +3.8%
PSUN +3.7%
CHS +3.6%
GDYS +3.5%
FRED +3.4%
DG +2.8%
SMRT +2.4%
TGT +1.8%
CMRG +1.8%
SKS +1.7%
SCVL +1.5%
GOT +0.5%
WMT +0.5%

FDO -0.1%
KSS -0.7%
GPS -1.0%
BLI -2.0%
CHRS -2.0%
DEBS -2.4%
FD -2.4%
DUCK -2.7%
PIR -2.8%
JAS -2.9%
GYMB -3.0%
ROST -2%-5%
CBK -4.0%
RVI -4.0%
ANN -4.5%
BONT -4.6%
TLB -4.6%
ANF -5.0%
DDS -5.0%
SHRP -6.0%
MAY -6.7%
PSS -6.9%
MWRK -13.0%
WTSLA -14.8%

  Jeff Bailey   9/2/2004,  2:34:14 PM
Wal-Mart (WMT) $52.69 +0.11% ... joins the party.

  Jonathan Levinson   9/2/2004,  2:33:44 PM
QQQ is testing previous resistance at 34.60. The 34.65 level is next, followed by 34.70 which capped the daily cycle upphase when last tested. A failed retest of this level is not incompatible with a daily cycle high being formed here, but a closing break above it will undo the stochastic sell signal on the daily chart and pave the way for a test of next resistance at the 35 level.

  Linda Piazza   9/2/2004,  2:33:23 PM
The OEX has exceeded the 540.76 upside target from its continuation-form inverse H&S. (See my 11:11 post for a chart.) Like Mark (see his 14:23 post), I ignored part of the long spike down yesterday morning on the rumor, so the true upside target for the OEX was subject to interpretation. Note: the continuation-form inverse H&S I pointed out earlier is not analogous to this new one Mark has pointed out on the SPX.

  Jeff Bailey   9/2/2004,  2:33:17 PM
NYSE Composite (NYA.X) 6,506 +0.56% ... gets the trade at 50% retracement.

  Linda Piazza   9/2/2004,  2:30:10 PM
The SPX hits upper Keltner channel resistance on its 15-minute chart.

  Linda Piazza   9/2/2004,  2:29:21 PM
The OEX has not yet managed a breakout on its 15-minute chart above the channel line that usually stops it, with that breakout shown by 15-minute closes above the channel line currently at 540.40. As I type, however, the OEX is charging above that line, so it's possible that this 15-minute period will show such a close. The upside target presented by continued 15-minute closes above that channel line is 542.79, but watch the SPX, too, with relationship to its 200-sma.

  Mark Davis   9/2/2004,  2:28:50 PM
SPX 1112.07... Wow!

  Jeff Bailey   9/2/2004,  2:28:12 PM
Intel (INTC) $21.58 +0.68% .... session high.

Bulls and BEARS will be listening closely to tonight's mid-quarter update.

  Jeff Bailey   9/2/2004,  2:26:43 PM
NYSE Composite ($NYA.X) 6,499.38 +0.45% ... updated daily interval bar chart from prior Index Trader Wraps at this Link

  Mark Davis   9/2/2004,  2:23:33 PM
No guarantee this "continuation" inverse H&S pattern will play out but the upside target for SPX is 1124. Link
I discounted the very long lower wick of yesterday's false alarm terrorist news (pepper spray incident).

  Linda Piazza   9/2/2004,  2:20:23 PM
On a Keltner basis, those hoping for a continued SPX test of the 200-sma want to see the SPX find support at the Keltner lines currently at 1109.60-1110.15 on any pullbacks, although they'll take five-minute closes above the Keltner line currently at 1108.87, and will grudgingly accept closes above 1107.59.

  Linda Piazza   9/2/2004,  2:19:10 PM
The BIX has inched above 360. Because the TRAN has been such a good indicator index lately, I knew before I even looked at its chart that it would be at a new high (in comparison to recent highs), and it is. At 3139, it's rapidly approaching the 8/03 swing high of 3147.23.

  Jonathan Levinson   9/2/2004,  2:18:58 PM
The high print of 34.58 failed on the upper 30 min Keltner channel resistance, but volume is increasing and the short cycles are just starting their upswing. If QQQ doesn't fall back below 34.48 quickly, a break of 34.65 could see the 30 min channel turn back up and a break above the prior high at 34.70 could lead to a wave of short covering.

  Jeff Bailey   9/2/2004,  2:18:10 PM
NYSE Composite ($NYA.X) alert 6,502 +0.49% .... as it appraoches its 50% retracement (6,505) of March high to May lows.

  Jeff Bailey   9/2/2004,  2:16:44 PM
QQQ $34.55 +0.81% ... DAILY R1 and session highs.

Looking $34.82-$34.89 by the close

  Linda Piazza   9/2/2004,  2:15:32 PM
The OEX is now at the . . . nix that, now past the upper trendline on its symmetrical triangle. Remember the SPX is engaged in a test of its 200-sma while you make decisions about whether to enter long or not. I'm not thinking I would even though gains could be big if a short-covering squeeze gets started.

  Mark Davis   9/2/2004,  2:14:42 PM
I smell a short squeeze... once again the market surprises us

  Jonathan Levinson   9/2/2004,  2:14:24 PM
QQQ chart at this Link showing channel resistance at 34.58, just below the confluence zone at 34.60-.65.

  Linda Piazza   9/2/2004,  2:13:38 PM
So far, there's been no pullback on the SPX as it attempts to break above the Keltner resistance, but there hasn't yet been a 15-minute close above that resistance at 1108.87-1109.14, either. It looks possible that the SPX could be breaking out, however, charting up toward the next Keltner line at 1112.47. Remember the 200-sma will interfere, but if this target is correct, that might mean at least a stop-run over the 200-sma, if not further gains.

  Mark Davis   9/2/2004,  2:13:25 PM
SPX 1-min MACD just printed a bullish kiss... not good for shorts unless it turns back down very soon.

  Jeff Bailey   9/2/2004,  2:13:15 PM
Bearish day trade stop alert for the Semiconductor HOLDRs (SMH) $29.70

  Jonathan Levinson   9/2/2004,  2:12:36 PM
QQQ testing 34.48 here as the short cycles begin to perk up.

  Linda Piazza   9/2/2004,  2:09:52 PM
The BIX is attempting a climb again, posting a big gain during the last five-minute candle, but it's now up against Keltner resistance just under 360. A breakout here, accompanied by five-minute closes above the Keltner line currently at 359.44, would set up an upside target near 360.66, but so far, the BIX is turning down at that Keltner resistance.

  Jonathan Levinson   9/2/2004,  2:08:10 PM
Nymex crude is trading lower at 44.175 here, up just .40%.

  Jeff Bailey   9/2/2004,  2:06:36 PM
Taser Intl. (TASR) $32.10 +15.6% Link ... new session highs.

Bar chart technicals .... resistance from 50-day SMA $32.65 and downward trend about $32.65 just ahead. Last time TASR got a close above its 50-day SMA, stock made a decent move higher to $45.

Volume starting to build a little at 12.3 million traded.

  Jeff Bailey   9/2/2004,  2:06:03 PM
Semiconductor HOLDRs (SMH) $29.60 +0.16% ....

  Linda Piazza   9/2/2004,  2:05:28 PM
Although the OEX hasn't yet reached the descending trendline off its 8/27 high, the SPX has, and it's trying to inch above it. We'll get a preview of whether the OEX might be able to do so, too.

  Jeff Bailey   9/2/2004,  2:05:18 PM
S&P Retail Index (RLX.X) 398.15 +2.00% .... getting some trend.

  Jeff Bailey   9/2/2004,  2:04:40 PM
Broker/Dealer Index (XBD.X) 124.18 +0.05% .... edges into positive territory first time today.

  Jonathan Levinson   9/2/2004,  2:04:02 PM
QQQ is printing 34.44, which is an event of relatively towering importance compared with the 2 cent range that prevailed over the past hour. A break above the session high of 34.48 targets channel resistance of 34.57 on the way to confluence at 34.60-.65.

  Jeff Bailey   9/2/2004,  1:58:44 PM
Day trade long alert .... for Wal-Mart (WMT) $52.39 -0.45% here, stop $52.20, target $52.80.

  Linda Piazza   9/2/2004,  1:55:02 PM
I'm surprised, although perhaps I shouldn't be, to find that the SPX's 15-minute Keltner chart configuration is much different than the OEX's. Support lines are more thinly spaced on the SPX. It looks as if two resistance lines might converge near 1109 by the time the SPX could rise that far, while strongest support will have by then converged near 1103-1104. Because there's bearish divergence on the Keltner lines on this chart, it appears likely that 1109-ish resistance will hold. However, if you look at that chart from a traditional standpoint, the configuration since yesterday morning is almost that of a bullish right triangle. At any rate, 1108.90-1109 looks important from a Keltner standpoint, but we knew that anyway, didn't we?

  Mark Davis   9/2/2004,  1:50:33 PM
Here's something to keep you busy if you're getting bored...

  Linda Piazza   9/2/2004,  1:48:07 PM
On the OEX's fifteen-minute Keltner chart, support still looks stronger than resistance, with first nearby resistance about to be tested at 539.05.

Next Keltner resistance on that chart is at 540.12, the approximate current location of the top trendline on the symmetrical triangle.

  Mark Davis   9/2/2004,  1:42:39 PM
We just took out the 12:40 swing high, dropped back a bit, and are now above it again. It's hardly an impulsive move but we're headed in the right direction if you're in a bullish play. TRIN has dropped to .85

  James Brown   9/2/2004,  1:41:32 PM
Jane, that's sad news. I have very fond memories of riding jet-skis on Lake Texoma. That was a blast!

  Linda Piazza   9/2/2004,  1:41:23 PM
One warning about that symmetrical triangle that we've been watching on the OEX's 60-minute chart: Several years ago, I read an article that refuted the until-then-generally-accepted axiom that if prices don't break out of a triangle before it narrows to its apex, the pattern is defunct. The research included a study that shows a break is just as valid as the triangle moves into the final 1/3, narrowing toward its apex. (Wish I could find that article now.) However, we've all noticed times when prices just seem to trade sideways out of a triangle or other formation, and I'm not sure those breaks are really breaks. We could have something like that happen today. Currently, the lower trendline is at about 538.08 and the top trendline is at about 540.

  Jane Fox   9/2/2004,  1:40:26 PM
James (13:35 pos) there are a lot of people who will be happy to hear this news because they really don't like jet skis.

  Jeff Bailey   9/2/2004,  1:40:02 PM
Retail Index (RLX.X) 397.10 +1.73% ... busting a move higher.

  Jonathan Levinson   9/2/2004,  1:39:31 PM
James, that Polaris news is spectacular news for nature lovers. Property values around country lakes should rise on the news...

  Jonathan Levinson   9/2/2004,  1:38:25 PM
QQQ just printed 34.40 again...

Bonds have weakened, TNX now up 5.5 bps at 4.178%, while gold is down 2.70 and resting on 408 support at 408.10. HUI has lost 1.4% to 204.74, XAU -1.28% to 94.12.

  James Brown   9/2/2004,  1:38:00 PM
After a couple of days consolidating above $85.00 shares of EBAY are on the move again. The stock is within striking distance of the $90.00 level after receiving another upgrade to a "buy" this morning.

  James Brown   9/2/2004,  1:35:00 PM
It's a sad day for jet-ski enthusiasts... Polaris Industries (PII) said they would be getting out of the personal water-craft business because the market is shrinking and has been since 1996. The stock is up more than 5% to $51.00 on the news.

  Mark Davis   9/2/2004,  1:34:34 PM
Linda snookered me by anticipating my daily question re: the stop running push. I'll have to start posing the question a little earlier... lol

  James Brown   9/2/2004,  1:30:56 PM
Apparel retailer American Eagle Outfitters (AEOS) is up almost 6% to $36.19 as Wall Street upgrades the stock following yesterday's upside earnings announcement from AEOS.

AEOS is certainly out performing rivals at ANF and GPS.

  Jeff Bailey   9/2/2004,  1:29:22 PM
Research in Motion (RIMM) $62.19 +2.45% Link ... busting a move to session high here. One of the strongest stocks in the NDX.X/QQQ.

  Linda Piazza   9/2/2004,  1:27:58 PM
The OEX is getting squeezed tighter and tighter between Keltner support and resistance on the five-minute chart, with those now about equally weighted. Support still looks slightly firmer on the 15-minute chart. In anticipation of Mark putting me on the spot :-) and of the stop-running push that usually comes from 1:35-1:55, I've tried to determine which direction the push will come, but that neutral triangle on the 60-minute chart says it all: the OEX could go either way.

  Mark Davis   9/2/2004,  1:25:27 PM
We've been going sideways for the last 15 minutes and I'm still showing the potential for a nice buy signal. The sideways action is just storing up energy for whichever way this breaks. We're right at the lower b-band again but the b-bands are much tighter this time. Maybe Linda's stop-running push will break the logjam
Original Benchmark from 15 min ago = SPX 1107.54, current print = SPX 1107.71

  Jonathan Levinson   9/2/2004,  1:20:29 PM
New chart on Hurricane Frances at this Link and a Reuters story with some breathtaking satellite photos at this Link.

  Mark Davis   9/2/2004,  1:18:48 PM
I've been enjoying a running Intel conversation over the past few days with one of our astute readers and he brings up some good points...

Hey Mark, I hate to bug you on this again, but yes there is negative broker comments on Intel, but investor sentiment is hugely optimistic. In the 22.50 strike alone we have a pc ratio of .25 with a staggering 4 times more calls than puts purchased today. The overall ratio stands at .60. Couple that with a very low VXN and most likely a lousy unemployement number tomorrow and everyone expecting a rally on the last day before labor day... I would not chase longs. In fact, there will probably be short covering into the close and that would be a great time to short, as long as we close below 1112 SPX. Marc

Thanks Marc (and congrats on the great first name)

  Jeff Bailey   9/2/2004,  1:18:08 PM
Bearish day trade lower stop alert for the Semiconductor HOLDRs (SMH) $29.46 -0.3% as they start to soften here. Lower stop to $29.70.

  Jonathan Levinson   9/2/2004,  1:15:16 PM
That gentle cresting 30 min channel still looks bearish to me Link but the fact that the short cycle downphase has been this weak for the past nearly 2 hours is bullish. With price still respecting its 7 or so cent range, I suppose it's OK that I've begun talking to myself as of a few minutes ago.

  Jeff Bailey   9/2/2004,  1:11:55 PM
Intel (INTC) $21.42 -0.09% .... I'm going to predict a $21.20 close.

If so, should like up with SMH near $29.20.

  Jeff Bailey   9/2/2004,  1:08:05 PM
Semiconductor HOLDRs (SMH) $29.51 -0.13% ....

  Jeff Bailey   9/2/2004,  1:07:18 PM
October Crude futures (cl04v) $44.70 +1.59% (30-min delayed) ... slips back under its DAILY R1.

WEEKLY Pivot $44.23 has not been tested since opening of regular session.

  Linda Piazza   9/2/2004,  1:06:55 PM
The BIX is still headed down, near the low of the day, with the TRAN headed up, near the high of the day. The SOX sort of just sits there. No clarity from a look at these indicator indices.

  Jeff Bailey   9/2/2004,  1:05:50 PM
01:00 Internals at this Link

  Mark Davis   9/2/2004,  1:05:48 PM
If the 1-min MACD can turn back up and cross we will have a pretty good buy signal. If not then we could be starting a downtrending move. My bias remains UP for now but that could change quickly. We're right at the lower b-band as I type this. If we bounce from here it will generate a buy signal. We should know in the next few minutes.
Benchmarking... SPX = 1107.54

  Linda Piazza   9/2/2004,  1:04:38 PM
The OEX's fifteen-minute Keltner chart shows support at 538.04-538.40, with the OEX about to test that support. It's not quite as firm as it was earlier, but it still looks firmer than resistance. However, it might be possible for the OEX to slip beneath a couple of those slightly separating lines now, so that they form resistance rather than support. For now, support looks firm enough to hold, but barely, and it perhaps wouldn't hold if there were a strong push downward.

  Jeff Bailey   9/2/2004,  12:56:55 PM
12:50 Market Watch at this Link

Retailers pressing session high. Heavyweights WMT $52.33 -0.57% and HD $37.17 +0.78% move different directions.

Sounds similar to NTES $36.30 +0.88% and SOHU $14.50 -0.54% of late.

  Jonathan Levinson   9/2/2004,  12:56:47 PM
Yukos: Production in Danger of Stopping 2 September 2004, 12:51pm ET , EDGAR Online Link

Nymex crude is currently trading 44.575, up 1.31% and well off its 45.30 high.

  Mark Davis   9/2/2004,  12:46:40 PM
Jim the frying pan can be fun (for spectators)... Link

  Mark Davis   9/2/2004,  12:41:04 PM
The markets seem to be under "Intel Lockdown" today with a slight bullish bias. I'd be surprised to see a major selloff after the Intel news since there has been so much negative press in recent days. The mid-quarter update would have to be a complete disaster IMO. In the light of that my best guess is we break out of this range to the upside... emphasis on "guess".

  Jonathan Levinson   9/2/2004,  12:40:30 PM
The current wavelet bounce within what appears to be a sideways short cycle downphase launched from the 34.36 QQQ level. I see a potential head and shoulders if the bounce fails at 34.43 or below 34.45, while it will become rectangle if 34.48 is tagged again. A breakout above 34.48 on expanding volume targets 34.60-.65, with 34.70 the current daily cycle top. Link

  Jeff Bailey   9/2/2004,  12:34:02 PM
Current OPEN MM Profiles at this Link

  Linda Piazza   9/2/2004,  12:31:07 PM
The OEX's five-minute Keltner bands have narrowed, ringing the OEX around with support and resistance, so that a breakout seems as if it must occur. It's trying an upside breakout now. On the 15-minute chart, the OEX has settled into an equilibrium position, and it can sometimes maintain that equilibrium position through several hours or even an entire day's trading while the OEX cycles in a three-point range. Support still looks slightly stronger than resistance on that chart.

  Jonathan Levinson   9/2/2004,  12:27:03 PM
Session low for bonds here, with TNX up 4.9 bps at 4.172%, a 1.19% move today.

  Jeff Bailey   9/2/2004,  12:25:18 PM
October NY Harbor Gasoline (hu04v) $1.219 +2.52% (30-min. delayed) ... off session high of 1.235 and looks like some sellers at DAILY R2 1.233. WEEKLY R1 just above at 1.248.

  Linda Piazza   9/2/2004,  12:24:32 PM
The OEX is moving toward the supporting trendline on the symmetrical triangle on its 60-minute chart, but it hasn't hit it yet: Link This is occurring on a day when it's going to be tough to trust any development, and it's happening during a time period of the day when it's tough to trust any development, so be aware of the risks if you're considering an entry on either an upside or downside break of that triangle. Because the upside break would likely come just ahead of the SPX's test of its 200-sma, that's a particularly risky trade, but actually both risk being whipsawed out of a trade that turned out to be nothing more than a stop-run, soon reversed.

  Jeff Bailey   9/2/2004,  12:22:53 PM
October Crude (cl04v) 30-minute delayed chart just captured at this Link

5-minute intervals with DAILY and WEEKLY Pivots.

  Jonathan Levinson   9/2/2004,  12:22:05 PM
Stevie Ray Vaughan 5x, including once opening for Dire Straits in 1984. Allman Brothers Band in 1991, Phish opening for Santana in Vermont in 1992. Would have loved to see the Guess Who, but I was in diapers then :)

  Jonathan Levinson   9/2/2004,  12:20:46 PM
QQQ is sliding sideways, which isn't news, but the move has now flattened the 30 min, 60 min and short cycle oscillators following their upward runs. 30 min support is at 34.20, resistance 34.59. That looks bearish to me, coming as it does at the top of a runup, with 34.45 resistance tested but not broken.

  Jeff Bailey   9/2/2004,  12:15:09 PM
12:00 Internals at this Link

  Jeff Bailey   9/2/2004,  12:13:09 PM
TRIN / VIX.X very good correlations today.

Right now... both pegged just under their DAILY Pivots.

I've set alerts on both just above today's highs.

Also have my buy/sell program premium al_rts set up.

  Jane Fox   9/2/2004,  12:11:23 PM
How many of us remember that song?

  Jane Fox   9/2/2004,  12:09:49 PM
Dateline WSJ NEW YORK -- For the official band of the Republican National Convention, choosing songs can be perilous. To introduce First Lady Laura Bush Tuesday night, bandleader Jon Simpson wanted to play "American Woman" by The Guess Who. Then he read the lyrics:

Don't come a hangin' around my door
Don't wanna see your face no more
I don't need your war machines
I don't need your ghetto scenes
Colored lights can hypnotize
Sparkle someone else's eyes
Now woman, get away

The band quickly switched to "Isn't She Lovely" by Stevie Wonder.

  Linda Piazza   9/2/2004,  12:08:33 PM
Careful, bulls. Crude is hitting $45.00 again.

  Linda Piazza   9/2/2004,  12:04:48 PM
The TRAN is still up today, and the BIX is still lower, with the BIX near its low of the day, at 358.79 as I type. The SOX has not yet risen to test its 20-dma today, as it did yesterday. It's in the red, but only lightly so. Mixed indications from our indicator indices.

  Jeff Bailey   9/2/2004,  11:58:53 AM
11:56 Market Watch at this Link

  Jonathan Levinson   9/2/2004,  11:55:10 AM
Fla. Orders Evaucation As Hurricane Nears

2 September 2004, 11:51am ET , AP Online Link

  Jeff Bailey   9/2/2004,  11:49:18 AM
Financials a little soft again here.

BIX.X 358.81 -0.2% , XBD.X 123.86 -0.2%, IUX.X 312.96 -0.06%

  Linda Piazza   9/2/2004,  11:46:57 AM
As I thought might happen when I made that 11:20 post, the OEX appears to be moving down to test the mid-channel support on its 15-minute Keltner chart again. If the OEX should fall further, just below that 538-ish test, at about 537.50, the OEX will also be testing bottom support of the neutral triangle that I depicted in the chart linked to my 11:25 post.

  Jeff Bailey   9/2/2004,  11:39:37 AM
Semiconductor HOLDRs (SMH) $29.55 (unch) .... made current session high of $29.69 30-minutes ago.

Technical note: If a trader will take a conventional retracement from the 52-week low of $28.30 (08/13/04) to the recent bounce high of $30.99 (08/23/04), that retracement bracket looks to be very much in play.

61.8% retracement is at $29.33 (support) and 50% at $29.64 has been serving some near-term resistance, where yesterday's high gets marked at 38.2% retracement of $29.96.

Beautiful zones created with your pivot levels. Simply beautiful.

  Jeff Bailey   9/2/2004,  11:38:36 AM
QQQ $34.39 +0.35% .... about 40-minutes ago, QQQ made its current session high at $34.48. Not quite its DAILY R1 of $34.54.

Bears may leverage a short here.

  Jeff Bailey   9/2/2004,  11:36:51 AM
October Crude Oil futures (cl04v) $44.85 +1.93% (30-minute delayed) ... session highs here.

  Linda Piazza   9/2/2004,  11:32:42 AM
Those who want a trade today despite the concerns about whipsawing markets ahead of the INTC update tonight might watch for a break out of the triangle depicted in the chart linked to my 11:25 post. Be prepared with account-appropriate stops, however, in case the break is nothing more than a stop-run that's soon reversed. You don't want to follow it all the way to the other side of the triangle and then to a possible breakout the other direction. Be sure your account can stand whipsaws before considering it. Then be prepared with a profit-protecting plan when the 534.50 zone is approached to the downside if the break is that direction and if the 540.80 zone is approached to the upside, if the break is in that direction. Consider first whether you'll make this a daytrade, and how late in the day you would take a trade on such a breakout. In other words, have a plan in place before you even consider such a risky trade. Enough caveats to scare you off? Good, because only aggressive traders should be trading on a day like today.

A special concern attends an upside breakout, because it would probably come just ahead of an SPX test of its 200-sma, and that's not a trade I'd want to take just ahead of such an important test for the market.

  Jonathan Levinson   9/2/2004,  11:27:05 AM
Chart of Nymex crude at this Link.

  Linda Piazza   9/2/2004,  11:25:48 AM
Here's a big symmetrical triangle to watch on the OEX's 60-minute chart, with that triangle formed over this week: Link

  Mark Davis   9/2/2004,  11:22:59 AM
It hasn't happened yet but we're very close to a short-term trend change

  Jonathan Levinson   9/2/2004,  11:22:33 AM
Crude oil is up to 45.175 here, +2.67%, with a session high of 45.30 so far.

  Jonathan Levinson   9/2/2004,  11:22:09 AM
QQQ chart update at this Link.

  Linda Piazza   9/2/2004,  11:20:29 AM
There's the slightest hint of weakening in the OEX's Keltner charts. The OEX maintains fifteen-minute closes just where bulls would hope that it would, above the Keltner line currently at 538.96. Support just above and below 538 still looks stronger than resistance. Yet the bearish divergence continues, and the top line of the smallest Keltner channel hooks down. This is micro-managing and those bullish signs still remain, but since my thought is that, unless a short-covering squeeze gets carried away, resistance is likely to hold, I'm on the lookout for these signs. At the least, they indicate a possible move down to test that support again.

  Jonathan Levinson   9/2/2004,  11:13:17 AM
Volume has picked up since the bounce from 34.36 QQQ, but only slightly, and I have no confidence yet in the move above 34.43. This whole area is a great big chop zone, and a breakout above 34.70 (or a breakdown) would clarify matters immensely. If the bullish scenario is to play out, 34.43 and 34.30 in particular should act as support now.

  Linda Piazza   9/2/2004,  11:11:08 AM
Yesterday afternoon, I pointed out a weird continuation-form inverse H&S on the OEX's five-minute chart, and said that although there were some difficulties with its shape, including the steeply descending neckline, we shouldn't ignore that formation. The OEX did move through that neckline this morning. So what would the upside target be? Should we include that one 13:10 piercing candlestick that dropped below 537 in calculating the upside target? I think I'd tend to ignore that candlestick, and instead calculate the distance from the neckline down to 537, adding that difference to the point where there was a neckline break this morning. Using that as a calculating method, the upside target would be about 540.76. Here's a chart: Link Remember that I'm not particularly trustful of this formation to meet its upside target, especially since some Keltner-style bearish divergences continue to show up on the Keltner charts, but now we can use it to help us watch whether bullish hopes are fulfilled or not.

  Jeff Bailey   9/2/2004,  11:01:41 AM
10:50 Market Watch at this Link

  Jonathan Levinson   9/2/2004,  11:01:16 AM
Here's the break above 34.43. The bottom of the wavelet pullback was 34.36 QQQ within the still-trending short cycle upphase.

  Mark Davis   9/2/2004,  10:57:30 AM
It's only 8AM and I'm already yawning

  Jonathan Levinson   9/2/2004,  10:55:22 AM
Session high for INTC ghere at 21.48.

  Linda Piazza   9/2/2004,  10:54:05 AM
Keltner support strengthens enough near 537.90-538.25 that the OEX may not need to actually dip down to that support now, but instead may find support nearer the Keltner 15-minute line currently at 538.82, at least on fifteen-minute closes.

  Jonathan Levinson   9/2/2004,  10:50:17 AM
The drop from 34.43 to the current 34.39 has the short cycle upphase flattened at what could well be the top, given the overbought and recently trending short cycle oscillators. Key here will be whether 34.30 to 34.33 holds on a retest.

  Jonathan Levinson   9/2/2004,  10:45:04 AM
QQQ is just sitting on the line: Link . The 30 and now 60 min channels are sloping up, and it's starting to feel like QQQ wants to try for a break above resistance. Next strong resistance is at 34.60-.65.

  Jeff Bailey   9/2/2004,  10:44:19 AM
Current OPEN MM Profiles at this Link

  Linda Piazza   9/2/2004,  10:43:26 AM
The SOX hasn't yet challenged its 20-dma today, with that average having been important resistance over the last couple of months. The 20-dma is at 379.38, with the SOX currently at 373.93 as I type. While a move over the 20-dma might be a first step in showing strength, it would really be a close above that average that would be the most important first step. Even then, the SOX has many hurdles to get through in the form of multiple nearby strong resistance levels. Intel has a lot of weight on its shoulders as it prepares its mid-quarter update, but shorts also have a lot of profit, needing protection.

  Jonathan Levinson   9/2/2004,  10:40:49 AM
My prayers go out to our readers in the southeast. The rest of us should be busy counting our blessings.

  Mark Davis   9/2/2004,  10:38:07 AM
BTW Jonathan, thanks for the great hurricane links

  Jeff Bailey   9/2/2004,  10:36:45 AM
Semiconductor Index (SOX.X) 373.36 -0.21% .... hasn't been able to trade DAILY Pivot (374.26) so far this session.

  Jeff Bailey   9/2/2004,  10:34:21 AM
Semiconductor HOLDRs (SMH) $29.52 -0.10% ... battling with DAILY Pivot

  Jane Fox   9/2/2004,  10:31:23 AM
Mark great scenario (post 10:28). I also agree with the slipping and fainting stuff.

  Jonathan Levinson   9/2/2004,  10:31:01 AM
QQQ couldn't break yesterday's high: Link

  Linda Piazza   9/2/2004,  10:30:19 AM
OEX 539.55 did turn out to be the top of the first advance. (See my 10:21 post.) Now the OEX retreats toward the 537.90-538.50 Keltner support shown across the five-and 15-minute charts. About mid-way through that support zone looks to be the firmest support.

  Jeff Bailey   9/2/2004,  10:30:14 AM
10:00 Internals at this Link

Yesterday's Internals at this Link

  Mark Davis   9/2/2004,  10:28:31 AM
The markets are like a group of mountain climbers today. The lead climber is just short of the summit and running out of oxygen. Either he is going to faint and slip or the next climber below him will arrive with a fresh bottle of oxygen. So far I'm voting for a fainting spell. Even if the oxygen arrives the top of the mountain is very near... take a few pics and head back down.

  Jeff Bailey   9/2/2004,  10:26:25 AM
Taser Intl. (TASR) $30.30 +9.2% ... here's my updated bar chart with fitted retracement at this Link

  Jeff Bailey   9/2/2004,  10:24:22 AM
Taser Intl. (TASR) $30.00 +8.8% Link ... gets the double top buy signal.

  Jonathan Levinson   9/2/2004,  10:21:59 AM
Session high for QQQ here at 34.34, testing yesterday's high. Link

  Linda Piazza   9/2/2004,  10:21:04 AM
On the OEX's 15-minute chart, support near 537.90-538.20 still looks firmer than nearby resistance, but the five-minute chart shows that 539.55-539.77 resistance may be about equal to nearby support, suggesting that zone might top out this very short-term advance until the OEX pulls back again toward 538.20-538.50 or so. Is that an area at which one should enter a long position prior to hoped-for further advances? I don't believe so, although any short-covering squeeze today could produce mighty profits. It's just too iffy to assume there will be that squeeze to bump indices above resistance. The SPX is just points below its 200-sma, not a wise place at which to enter new long positions although we're talking about the OEX and not the SPX.

  Jeff Bailey   9/2/2004,  10:19:22 AM
Semiconductor HOLDRs (SMH) $29.45 -0.33% .... daily pivot levels as follows. $28.70, 29.14, Piv= 29.59, 30.03, 30.48

  Linda Piazza   9/2/2004,  10:14:32 AM
Having the TRAN chart updating was too good to be true, so I'm back to using the 390-minute chart again today. However, the TRAN again opened above 3100 and now is at 3126.68, just below yesterday's 3132.60 high. The TRAN just won't give up, will it, especially surprising with crude up $0.55, at $44.55 as I type. Be careful about assuming that the TRAN can maintain its climb if crude continues to climb, however. That uncoupling of the inverse relationship between crude action and equity action may be beginning, if market participants feel that crude's rise is temporary and perhaps the last hurrah, but that's a dangerous assumption.

  Jeff Bailey   9/2/2004,  10:13:55 AM
Taser Intl. (TASR) 28.90 +4.14% ... has seen some strong volume in early trade.

  Jonathan Levinson   9/2/2004,  10:13:14 AM
The short cycle oscillators are getting extended to the upside here, with QQQ so far unable to tag even the 34.40 level. The 30 min cycle channel is still sloping higher, and so the short cycle bias remains to the upside. There's still the chance of an upside trending move for the short cycle, but so far, the listlessness in QQQ isn't encouraging. Again, this is a chop zone, and the picture will clarify on either an upside break of 34.70 or a downside break of 33.80.

  Mark Davis   9/2/2004,  10:10:58 AM
The previously mentioned CCI and MACD divergences have not disappeared, nor has the sell signal, although it tried to abort several times. Since we're so close to yesterday's highs I'd have to give the divergences more weight than usual until proven differently.

  Linda Piazza   9/2/2004,  10:10:54 AM
The BIX attempted another move back over 360 this morning, but couldn't sustain that. It's challenging the 10-dma as I type, with that average at 359.12 and the BIX at 359.28.

  Linda Piazza   9/2/2004,  10:06:45 AM
Back. The good news is that I don't appear to have any viruses. The bad news is that the problem with my connection appears to be the fault of my broadband provider, so I'm on dial-up for the near future.

As I expected pre-market, the OEX dipped down to test the 538-538.40 support zone showing up on both five- and fifteen-minute Keltner charts and then began climbing into resistance during the first retracement of the day. Support lines are beginning to separate a bit, but support near 537.90-538.25 still looks relatively firm. If the OEX can maintain five-minute closes above 538.85, it looks as if the 539.70-539.75 area will be the next Keltner resistance band it might challenge. So far, however, Keltner-style bearish divergence continues on that chart, so I'm not sure that it can maintain those five-minute closes. Remember that these bearish divergences warn only, while price should be the ultimate guide.

  Jeff Bailey   9/2/2004,  10:05:38 AM
10:00 Market Watch at this Link

Overnight high for October Crude Oil futures (cl04v) was $44.79. Pretty close to the $44.75 level noted in last night's Index Trader Wrap.

  Jonathan Levinson   9/2/2004,  10:04:56 AM
Session low for euro futures here at 1.2155, -.25% for the session.

  Jonathan Levinson   9/2/2004,  10:03:08 AM
Nymex crude oil is pulling back, now up .45 at 44.45. Chart at this Link.

  Jonathan Levinson   9/2/2004,  10:02:01 AM






  Jonathan Levinson   9/2/2004,  10:00:40 AM
Session low for gold, high for QQQ and NQ, QQQ just breaking 34.30.

  Jim Brown   9/2/2004,  10:00:06 AM
Alert - Factory Orders = 1.3%, (est +1.1%, last +0.7%)

  Jonathan Levinson   9/2/2004,  9:55:42 AM
The Fed has announced an overnight repo of 9.5B, and so all of the 24.5B expiring has been replaced, no net change for the day.

  Mark Davis   9/2/2004,  9:55:08 AM
I'm seeing CCI and MACD negative divergence on the SPX 1-min chart. This doesn't mean price HAS to go down, but it does make it more likely until the divergence disappears.

  Jonathan Levinson   9/2/2004,  9:54:48 AM
34.30 is looking like key resistance here. There's more resistance at 34.33 QQQ, but I expect a burst of volume if we get a break above 34.30 for longer than a couple of seconds. We'll see. Data due in 6 minutes.

  Jeff Bailey   9/2/2004,  9:52:35 AM
S&P Retail Index (RLX.X) 394.80 +1.15% Link ....

  Jonathan Levinson   9/2/2004,  9:48:36 AM
There's a weak upward drift in equities toward unchanged, and gold is up a few cents to 409.80, with HUI -.77% at 206.06 and XAU -.92% at 94.46. TNx is up 2.8 bps to 4.151%. There's data due at 10AM as well as the remainder of the Fed's repo announcements, and so I expect some movement by then.

  Jeff Bailey   9/2/2004,  9:45:36 AM
Semiconductor HOLDRs (SMH $29.36 -0.64% .... DAILY Pivot levels as follows. $28.70, 29.14, Piv= 29.59, 30.03, 30.48

  Jim Brown   9/2/2004,  9:43:29 AM
Linda is having Internet problems this morning and will be back in the monitor when her current challenge is corrected.

  Jonathan Levinson   9/2/2004,  9:42:16 AM
QQQ 2-day 100-tick chart at this Link.

  Jeff Bailey   9/2/2004,  9:40:51 AM
S&P Retail Index (RLX.X) components at this Link after many report sales.

  Jonathan Levinson   9/2/2004,  9:39:06 AM
Very quiet open today.

  Mark Davis   9/2/2004,  9:37:32 AM
SPX is printing a sell signal right out of the gate, MACD just crossed down to confirm

  Jonathan Levinson   9/2/2004,  9:35:51 AM
Good news:

NEW YORK (CBS.MW) -- Armed hostage-takers have freed 26 women and children from a Russian school where hundreds of others were held captive by gunmen, Agence France-Presse reported, citing news agencies.

  Jonathan Levinson   9/2/2004,  9:33:44 AM
The Fed has ponied up 15B in 14-day repos against the 24.5B expiring for the day. I expect the remaining short term repos to be announced at 10AM.

  Jonathan Levinson   9/2/2004,  9:28:08 AM
The same cycle ambiguity from yesterday's close persists this morning. The bounce yesterday afternoon whipsawed the 30 min cycle to the upside, and that whipsaw stalled the daily cycle downphase on its bearish kiss. If you squint, there's a bearish cross on the 10-day stoch, but to call it a true sell signal, we'd want to see the 33.80 QQQ level broken to the downside on a closing basis at the very least. In effect, the cycles are mixed, and I'm not inclined to rely on them. I find the light volume and violent swings to be bearish, but that's more of a gut feeling. In cases like this, it's safest to follow a breakout- in this case, I'd be watching fpr a break above 34.45 to target 34.60-.65, or below 34.05 to target 33.90 and 33.80. A move below 33.80 or above 34.70 should be directional, and unfortunately, the cycles I track give no indication here as to which is more likely to be broken first.

  Linda Piazza   9/2/2004,  9:10:16 AM
It's always difficult to gauge where markets are likely to open based on the behavior of futures, especially when futures are only lightly positive or lightly negative. However, with futures down slightly, there's a chance the OEX might dip down near the opening to test that gathering Keltner support near 538 on the five-minute chart and from 537.80-538.20 on the 15-minute chart. Unless there's a gap-down move, which seems unlikely at this point, or else a strong and immediate down-thrust, which also seems unlikely at this point, that support is likely to hold on the first test. Although it's possible that any bounce will just continue all day, past resistance, all the way up to the 200-sma, it's difficult to recommend a long play so near that resistance, and perhaps the safest assumption should be that it will be likely to hold this time, too.

We'll then have to see how the OEX performs on the first reversal of the day, likely after it finishes testing the gathering support, but it appears likely that it might then rise to test that resistance. Keltner charts are currently configured to show it easier for the OEX to rise to test that resistance than to drop too far below 538. The OEX remains mired in its latest congestion zone, and we should anticipate difficult trading conditions while it remains within that zone. Any attempt to test resistance will likely be accompanied by stop-running attempts to break out, perhaps or perhaps not successful. That depends on how many shorts panic and decide to cover their positions, among other factors. It's difficult to anticipate the reaction ahead of Intel's after-the-close update, and that difficulty was demonstrated in overnight trading. In Japan, computer-related stocks bounced, but elsewhere in Asia and Europe, they declined. Different reactions to the same upcoming event, and unless you have a crystal ball that predicts how U.S. markets will react, today might be a day to be particularly cautious about initiating trades.

  Linda Piazza   9/2/2004,  8:52:46 AM
I was just listening to NPR, to a reporter just outside the school in Russia. The interpretation there, not confirmed, is that the explosions as well as sporadic gunfire and the refusal of food and water are meant to rev up the stakes before the attackers make their demands. They have not yet done so. As stated, this was the reporter's conclusion after talking to people on the scene, and not confirmed. No one knows for sure what's happening inside. The report also stated that the number of hostages is probably far greater than the official announcement. Locals believe that between 750-1,000 people have been taken hostage and that the government has been deliberately downplaying the number of hostages. Only about 50 of the school's normal 800 students were able to escape, and many parents were with their children on the opening-day ceremonies.

  Jonathan Levinson   9/2/2004,  8:34:00 AM
The futures are lower on the data, with QQQ down .09 to 34.18 here. Gol dis unchanged, bonds are slightly higher but still negative, and crude oil is higher to a session high of 44.625.

  Jonathan Levinson   9/2/2004,  8:30:55 AM



8:30am U.S. 4-WEEK AVG. JOBLESS CLAIMS UP 6,250 TO 343,000




  Jonathan Levinson   9/2/2004,  8:20:54 AM
The Fed has a large 24.5B in various term repos expiring today. I'd be surprised to see a large expiry, as the Fed has been maintaining or expanding the repo pool every day for the past several sessions. I'll report on the announcements as they come out this morning to determine the net change for the day.

  Jonathan Levinson   9/2/2004,  8:07:13 AM
I've just come across this amazing "live" java image of the satellite imagery of the hurricane: Link

  Jonathan Levinson   9/2/2004,  7:57:26 AM
Equities are flat, with ES trading 1106.75, NQ 1378.5 and YM 10170, QQQ +.01 at 34.28. Gold is down 1.10 at 409.70, silver flat at 6.79, bonds down .046 at 113.5625 and crude oil up .525 at 44.525.

We await the 8:30 release of revised Q2 productivity, est. +2.7% and initial claims, est. 340K. At 10PM we getFactory orders, est. 1.1%.

Headline just printing as I type:


  Linda Piazza   9/2/2004,  6:51:35 AM
Good morning. The Nikkei opened more than 50 points in the green, but dropped suddenly into negative territory about midway through the morning session. The Nikkei climbed off that low through the afternoon session, closing higher by 25.40 points or 0.23%, at 11,152.75, but it did not achieve its high of the day again.

Articles mentioned weaker U.S. car sales and rising crude costs for the susceptibility to a decline. Car makers and some other exporters dropped in early trading, with their declines countered by a rise in computer-related stocks. Some believe that any negative news that Intel might deliver has already been priced into the market, but that rise was perhaps also produced by profitable shorts deciding to cover ahead of Intel's update. One computer-related Japanese stock not climbing was Kyocera, a manufacturer of semiconductor parts, telecommunications equipment and electronic components. CSFB downgraded the stock to a neutral rating from its former outperform rating. Some banks also fell, but Shinsei Bank rose 0.2% after an announcement that it might take an at least 51% stake in Showa Leasing.

Other Asian markets did not show the same behavior among computer-related shares, as Samsung Electronics, Taiwan Semiconductor, and Chartered Semiconductor all closed lower. Other Asian bourses were mixed. The Taiwan Weighted lost 0.09%, but South Korea's Kospi gained 0.79%. Singapore's Straits Times hit a 3-1/2-year high, climbing 0.59%. Hong Kong's Hang Seng fell 0.19%, but China's Shanghai Composite climbed 0.49%.

Currently, European bourses mostly trade in the green, with that performance due to the performance of defensive shares, including utilities and food-related companies. Many chip-related shares dropped in early trading, including ASML and STMicroelectronics. CSFB trimmed STMicro's rating to a neutral rating from its former outperform one. Other stocks appeared to react to individual developments or earnings announcements. Car stocks traded according to their sales performances released yesterday. Volkswagen also dropped as a result of its replacement in the Dow Jones Euro Stoxx 50 by bank Credit Agricole. Credit Agricole gained, also benefiting from a Morgan Stanley upgrade ahead of the French bank's earnings next week. Luxury goods maker Pinault-Printemps-Redoute, owner of the Gucci brand, missed forecasts and dropped almost 5% in early trading. Air France's shares were steady after its earnings report. The company reiterated its full-year target if the average market price for oil is at $40 for that period, and said that each change of $1.00 in oil price would impact the company by $5 million per month.

As of this writing, the FTSE 100 has gained 12.20 points or 0.27%, to trade at 4,514.20. The CAC 40 has gained 16.98 points or 0.47%, to trade at 3,630.21. The DAX has gained 7.98 points or 0.21%, to trade at 3,825.60.

  Linda Piazza   9/2/2004,  2:20:41 AM
The OEX is trapped in a consolidation zone that is producing choppy trading: Link As long as the OEX remains trapped in that consolidation zone, the choppy trading conditions are likely to continue. The trouble is that the OEX's zone is less clearly defined than that on some other indices, so when has the breakout occurred? The bulk of the zone lies between 536.50 and 541, but the zone is actually bounded by the 30-sma at 533.10 and the 100-sma at 542.17.

The OEX may still be turning down into another shoulder for an inverse H&S, toward 530-532, but traders should be aware of the possibility that the OEX could push above the supposed neckline, up toward the 200-sma, currently at 545.80.

That's a look at what's happening based on the daily chart. Here's a look at the 120-minute chart: Link I mentioned earlier this week that this potential H&S was a far-from-classic formation, but despite the run-up past 540, that formation might still have some viability, especially when determining whether there's been a breakout or breakdown. A push above the head would indicate an upside breakout and a fall below the 120-minute 100-ema, confirmed by a break below 533.79 would indicate a downside breakdown. There's danger with those assumptions, as the 533.78 breakdown would come just ahead of the 30-dma, but that's the best we can do.

As Wednesday ended, Keltner support was gathering near 537.80 on the OEX's 15-minute chart, so that it looked more likely for the OEX to climb, perhaps after a dip to that level, than for it to decline, at least in early trading. The five-minute chart suggested that the OEX would find it easier to climb than decline, too, so unless something happens overnight or pre-market that changes that outlook, a test of resistance may be in store. From this vantage point, the presence of that incipient H&S indicates that resistance would most likely hold and the OEX will likely round down from somewhere below 541. However, with Intel's update expected after the close tomorrow, anything could happen, including a massive short squeeze that catches fire and sends all indices higher. Be sure to watch crude costs and the SPX with relationship to its 200-sma before jumping on a supposed upside breakout, if one should occur, and always remain aware of that Intel update expected after the close. You don't want to jump on a long play when the SPX is $0.50 below a test of its 200-sma and may get turned around at that level, for example.

  OI Technical Staff   9/2/2004,  2:20:27 AM
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