Option Investor
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  Linda Piazza   9/15/200,  5:43:29 PM
Tomorrow, we'll have the sentiment damage done by a Dow close below the 200-sma battling the usual tendency for a large-range day to be followed by a small-range day. In addition, there's that pesky tendency for an opex Thursday to be difficult to trade as the movement is often over by early or mid-morning.

The OEX confirmed the indecision seen at the top of its descending regression channel by producing a tall red candle. RSI turned down although MACD did not produce a bearish kiss and stochastics did not turn down below the signal line. Hopefully, market conditions will be such that we can get a look at TRIN and other measures of market health before making a decision, but a neutral TRIN and go-nowhere advdec line would certainly reinforce the tight-range day scenario. A bearish TRIN and advdec level would suggest that today's decline might continue. Of course, there's that other possibility, too, a rise. In fact, I wouldn't be surprised to see the OEX rise tomorrow morning, perhaps toward 543.30-544, although I'd sure want a look at the futures tomorrow morning before I promised any such thing was likely to happen. If the OEX does rise tomorrow morning toward 544, watch carefully for a rollover from that level, down through a descending line off yesterday's lows. Such a move would suggest that a continuation-form H&S was being confirmed. The downside target would be near the 540.80 S/R level that's also a downside Keltner target if another breakout occurs on the five-minute chart. A move above 545 would undo the H&S potential, however, and might suggest a move up to test the broken trendline off the 8/13 low, with that trendline now at 546.55.

Be careful of assuming that the market will obey typical technical analysis rules, however, in light of expected light volume and usual opex behaviors, coupled with that typical tendency to consolidate big losses or gains.

  Jeff Bailey   9/15/200,  4:58:34 PM
Closing Internals at this Link

  Mark Davis   9/15/200,  4:20:54 PM
I'm back in the bearish camp, for the short-term at least. SPX 1125 was an important area and took some doing to break through. We did break through but were stopped just shy of SPX 1130, the upside target for the inverse H&S on the SPX 30-min chart. Now we're back below SPX 1125 and the 1120.37 closing print is below any level that could be considered "underthrow territory", so I would consider the 1125 level to be resistance, turned support, then turned back to resistance again today. I'll look at the charts tonight but I'm thinking 1118 could be the next stop and if that fails we could drop to stronger support at 1115. Max pain for SPX is 1100... I have not found max pain to be an indicator worth trading on but it should be noted it is below current levels by a fairly hefty -20 pts. If SPX rallies back to 1125 I would probably be looking at shorting again, depending on what the charts look like when/if we get there. Right now I don't see us getting there but as always, I reserve the right to change my mind on a moments notice... based of course on sound technical analysis (grin). We may have seen the September top... stay tuned.

  Jeff Bailey   9/15/200,  4:18:52 PM
Current OPEN MM Profiles at this Link

Today's Activity ....

Day trade long Taser Intl. TASR at $42.32, stopped $41.85. ($-0.47, or -1.11%).

  Jonathan Levinson   9/15/200,  4:00:34 PM
QQQ's chart is looking considerably less bearish than that of the Dow futures. On the ES, there's a triple intraday bottom, while the Dow has broken to new lows just now. QQQ has yet to reach its previous intraday low and has not broken 35.18 support either.

  Linda Piazza   9/15/200,  3:59:15 PM
Earlier today I mentioned that SOX bulls sure wanted to see the SOX bounce strongly from its converging 20- and 30-sma's to avoid creating an evening-star pattern on its daily chart. It didn't bounce or at least couldn't sustain a bounce.

  Linda Piazza   9/15/200,  3:51:10 PM
The OEX dropped to another new low, but immediately bounced up to test resistance. From this point on, end-of-day volatility reins, however, with the results sometimes not indicative of what will happen the next day. Bears with strong gains might decide to cover in the last few minutes. Bulls who have been hanging on too long might decide to sell. New bulls might decide this is a good place to enter. We do know, however, that the action has negated the possible inverse H&S on the five- and fifteen-minute charts, suggesting that bulls can't yet muster the needed strength to confirm a bullish formation.

  Mark Davis   9/15/200,  3:50:21 PM
Stopped out @ 1120.65, +3 pts if you've been following the short play.

  Jonathan Levinson   9/15/200,  3:48:21 PM
A break through 35.18 QQQ will set up a retest of the day lows, and a break below that would establish the 35.32 level as a much lower price and oscillator high- all bearish. 35.18 QQQ is the first line in the sand.

  Linda Piazza   9/15/200,  3:48:04 PM
The BIX has apparently completed its retest of the former ascending regression channel rising from the 9/09 low, with the BIX dropping down to retest this morning's 362.74 low, with the BIX at 362.76 as I type. Be watchful as the BIX approaches this possible support level.

  Mark Davis   9/15/200,  3:47:23 PM
If you're short from 1123.25 I would lower stops to 1120.65 and lock in a +3 pt gain.

  Mark Davis   9/15/200,  3:44:26 PM
The buy signal (1-min) just aborted early... so far so good but again I remind readers that the 1-min chart is very fickle and can reverse in a heartbeat. Still, a short from 1123.25 is looking good. We just took out the 3:14 swing low @ 1121.27 and I would consider that confirmation of a trend change, although we still need to get through "underthrow" territory. If you are short from 1123.25 I would lower your stops to 1121.25 to lock in +2 pts and then exit the trade before the close if not stopped out. If you're holding Oct contracts I would consider holding overnight... your decision.

  James Brown   9/15/200,  3:43:20 PM
A couple of bullish candidates ignoring the market wide weakness today is Aetna (AET) and Anthem (ATH).

  Jonathan Levinson   9/15/200,  3:37:21 PM
The 30 minute cycle channel upphase is stalling, while the 60 min channel is only beginning to stall within its downphase. Support remains at 35.10 QQQ for both cycles.

  Linda Piazza   9/15/200,  3:34:11 PM
Both the 5- and 15-minute OEX Keltner charts show strong resistance gathering from 544.40-544.84. Never doubt that a strong buy program couldn't propel the OEX past that resistance, but as of this writing, it looked stronger than any support on the five-minute chart and somewhat stronger that 543-ish support on the 15-minute one.

  James Brown   9/15/200,  3:33:16 PM
For weeks we've been watching Golden West Financial (GDW) for a breakout over resistance at $110. That breakout came today in a big way. The stock is up 3.46% to $112.74 on strong volume. The move has produced a new double-top P&F breakout buy signal with a $129 target. GDW's next level of resistance is the $116-117 region.

  Mark Davis   9/15/200,  3:31:25 PM
CCI just printed +200 on the little spike and SPX is at the upper b-band. Bears want to see SPX roll over short of 1123.25 and a lower high... again we're at a critical juncture. This is a very difficult market to trade, especially when the big moves come right after the opening bell when most traders holding current month contracts are flat.

  Jeff Bailey   9/15/200,  3:29:03 PM
Here come the shorts just to be safe.... ... TASR $43.08.

  James Brown   9/15/200,  3:26:45 PM
Dow-component MMM is looking bearish here. Shares have failed to breakout over the $85.00 level and now the stock is slipping through its simple 50 and 200-dma's. The MACD is nearing a new "sell" signal.

  Jeff Bailey   9/15/200,  3:26:37 PM
Taser Intl. (TASR) $42.50 +20% ... mounts the charge to the close.

  Linda Piazza   9/15/200,  3:25:39 PM
If you've got a bullish short-term view, then you might see this is a misshapen inverse H&S on the OEX: Link Whether that's what it is or not, it might be important to watch to see if there's a move above the neckline to confirm short-term bullishness or if there's a negation of the formation by a further dip and new low to confirm bearishness.

  Mark Davis   9/15/200,  3:24:33 PM
SPX is trying to print a buy signal. It's not there yet but should not be ignored. If you're short from the last sell signal @ 1123.25 an appropriate stop would be SPX 1123.25 and break even. SPX just confirmed the buy signal @ 1121.60 but it could easily abort early. If it does I would follow it down with stops and exit the short before EOD... it's just too close to opex to hold current month contracts overnight. If you're holding Oct contracts it may be worth holding overnight, especially since SPX did not reach 1125 before rolling over. I'll know more before EOD.

  Linda Piazza   9/15/200,  3:13:24 PM
Although the OEX's pattern through most of the day no longer looks bear-flag-ish on the five- and fifteen-minute charts, it does look a bit like a flag on a longer-term intraday chart. It would need to move to a new day's low to confirm a breakdown out of that formation. I'm watching the 30-minute 130-ema at 543.31, with a break of that MA serving as a first warning that the OEX could be breaking out of that formation.

  Jonathan Levinson   9/15/200,  3:12:41 PM
A move below 35.18 QQQ for 10 minutes or more would abort the 30 min cycle upphase as well.

  Mark Davis   9/15/200,  3:08:14 PM
Oops! The break came suddenly. I'd have to consider that big red candle a red flag. Bulls had better buy it quick or bears will reappear for their afternoon snack. Now I'm definitely regretting not taking the short signal... hopefully some readers did.

  Linda Piazza   9/15/200,  3:05:18 PM
Over the last hour, the 20-minute 130-ema has served as resistance for the OEX, with that average at 544.45. The OEX has reached up to touch it a couple of times, but has then dropped back each time. When it drops back, it drops back to the 30-minute 100-ema at 544.08. Now it's dropping below that average again, toward the 30-minute 130-ema at 543.31.

  Jonathan Levinson   9/15/200,  3:04:58 PM
The cash bond market has just closed, with TNX going out higher by 3.7 bps at 4.17%.

  Mark Davis   9/15/200,  3:04:39 PM
Keene I was just thinking the same thing. We are at a critical juncture here... much lower and 1-min MACD will make a bearish kiss and possibly confirm 1124 as the top of the bounce... much higher and MACD will cross up and possibly reignite the stalled rally. We should know within the next 5-10 minutes.... ticking up as I type.

  Jeff Bailey   9/15/200,  3:04:20 PM
02:55 Market Watch at this Link

HUI.X hugging its QCharts' WEEKLY R1 206.52 as support today, while the Dollar Index (dx00y) found some sellers just below its WEEKLY R1.

  Jonathan Levinson   9/15/200,  3:04:00 PM
The current weakness is another wavelet downphase- this cycle usually lasts for 20 minutes or so, and being so short, easily becomes pinned in overbought and oversold. It's just approaching oversold territory here, and the higher low at 35.25 reconfirms the short cycle upphase still progressing. The short cycle is not yet overbought, but it's getting close with little net progress in price over the past hour. A failure at or below 35.35 would likely stall the 30 min cycle upphase.

  James Brown   9/15/200,  2:58:55 PM
Copart Inc (CPRT) is down more than 13% and breaking support at $20.00 and its simple 200-dma on major volume after reporting earnings last night that beat estimates by 3 cents per share. The stock had been churning sideways in a tight range ahead of its earnings for the last four weeks.

  James Brown   9/15/200,  2:55:46 PM
Biotech stock PDLI is bucking the market-wide weakness today and breaking out over the $20.00 mark and its simple 200-dma. Actually shares have been challenging this area for the last couple of sessions but it's hitting new three-month highs today.

  Jeff Bailey   9/15/200,  2:53:22 PM
Current OPEN MM Profiles at this Link

  Linda Piazza   9/15/200,  2:52:04 PM
The OEX has so far been turned back from gathering Keltner resistance just below 545.

  Mark Davis   9/15/200,  2:51:50 PM
All the major indices 1-min charts look exactly the same on that last spike up... very overbought CCI readings, a confirmed sell signal but not much downside traction (yet). I'm beginning to regret I didn't take the short signal but it's still early... a pop to a lower high may be irresistable as a short (with a tight stop).

  Jonathan Levinson   9/15/200,  2:48:59 PM
QQQ 100-tick 2-day chart update at this Link.

  Mark Davis   9/15/200,  2:44:05 PM
SPX just confirmed a sell signal @ 1123.20

  Jonathan Levinson   9/15/200,  2:43:58 PM
Aside from the opening gap down, the current rise is steeper than the decline from the cash open. It's taken roughly half of the short cycle upphase's range to get QQQ this far, and 35.45 is still looking like a respectable challenge for bulls. But with the 30 min cycle oscillators in a young upphase, we need to watch for a higher low above 35.10 for the next short cycle decline to confirm that 30 min cycle upphase.

  Linda Piazza   9/15/200,  2:43:18 PM
On both the 5- and 15-minute Keltner charts, the OEX will hit mid-channel resistance just about the time it hits the upside target for the double-bottom formation. The five-minute chart suggests that if the OEX can sustain levels above that upside target, it might then rise toward a retest of the ascending trendline off the 8/13 low, currently just above 546.50. At this typing, that Keltner resistance looked strong enough to stop the OEX, but we've seen some stronger support overrun this morning, and it's possible that we could start seeing resistance overrun, too.

  Mark Davis   9/15/200,  2:42:58 PM
I'm seeing bearish divergence starting to show... 1124 may be the end of this run unless bulls can press higher and reverse the divergence.

  Jeff Bailey   9/15/200,  2:40:21 PM
Day trade bullish stop alert .... for Taser Intl. (TASR) $41.85

  Mark Davis   9/15/200,  2:39:53 PM
SPX was slapped back @ 1124 but Nasdaq isn't giving up any ground, making me think a decent shorting opportunity from SPX 1125 may be in the works. It's such an obvious number though that it may either roll over just short of 1125 or just above (bull trap)... or it could continue higher, but I think odds of that are slim. 1125 should be strong resistance and I'll be looking to get short at that level, especially if we are looking at overbought oscillator readings as we approach.

  Jonathan Levinson   9/15/200,  2:37:13 PM
QQQ is testing resistance at 35.34 here. Volume is picking up.

  James Brown   9/15/200,  2:35:05 PM
Cleveland Cliffs (CLF) an iron-ore miner is breaking out to new all-time highs near $75. Last week the stock broke through major resistance at the $70 level. The P&F chart points to a triple-digit target. Options are available but volume on the stock is low.

  Mark Davis   9/15/200,  2:32:10 PM
Reader Marc writes...
Watch COMP 1900. It's the only thing holding the pop back.
We're close Marc and I see Jim has noticed the same thing. Great minds think alike.

  Jeff Bailey   9/15/200,  2:31:07 PM
Bullish day trade raise stop alert .... for Taser Intl. (TASR) to $41.85.

  Jonathan Levinson   9/15/200,  2:27:17 PM
A 30 minute cycle upphase is underway for QQQ, but now it appears to be the bears running the clock with a sideways move below 35.34. Link

  James Brown   9/15/200,  2:27:13 PM
It's not optionable and volume is incredibly low but CKH is an oil-tanker stock that is breaking out over major resistance near 44.50-45.00. It almost looks like an inverse H&S pattern. The bullish P&F chart shows a quadruple top breakout buy signal and a $54 target.

  Linda Piazza   9/15/200,  2:25:59 PM
So far, the OEX has not been able to meet its expected upside target from its "almost" double-bottom formation, finding resistance below gathering Keltner resistance near 544.64-544.79. However, the OEX may not be through challenging that Keltner resistance and the 545 level. The OEX has not retraced more than 50% of the decline off yesterday's late-day last 5- and 15-minute swing highs, so it's actions cannot yet be deemed short-term bullish, but it no longer takes the form of a potential bear flag.

  Jeff Bailey   9/15/200,  2:19:38 PM
A Bush victory? .... Link

Pretty good follow through from the HMO's after that spread-triple top buy signal at 965.

  Jonathan Levinson   9/15/200,  2:16:47 PM
Crude oil continues lower, with a new low of 43.425 and a last trade of 43.60 here. I'm hearing that a spokesman for OPEC was saying that demand would be low in 2005, but I have no details yet.

  Jeff Bailey   9/15/200,  2:14:19 PM
Research in Motion (RIMM) $70.44 +2.62% Link ..... relative strength from a NASDAQ-100 leader.

  James Brown   9/15/200,  2:11:55 PM
Mortgage lenders CFC and NCEN are both nearing new all-time highs as they bounce back from last week's dip.

  Linda Piazza   9/15/200,  2:09:15 PM
The double-bottom formation in the OEX has been confirmed, of course, with an upside target just under 545.

  Jeff Bailey   9/15/200,  2:08:29 PM
Biotechnology Index (BTK.X) 525.64 +0.01% ... just edged green.

  Jonathan Levinson   9/15/200,  2:08:15 PM
QQQ is hovering at 35.30, but the move was enough to start the short cycle upphase. The wavelet oscillator is just reaching overbought, and this is where bulls need to keep up the heat to start that cycle trending in overbought so that the short cycle upphase can begin to strengthen.

Bonds have weakened slightly, with TNX now up 2.4 bps at 4.157%. Gold is down 1 at 406.50, while the HUI and XAU have strengthened slightly, still negative for the day.

  Jeff Bailey   9/15/200,  2:07:53 PM
02:00 Internals at this Link

  James Brown   9/15/200,  2:06:10 PM
Heads up for the bearish LXK traders out there. Once again bulls are buying the dip to LXK's long-term rising trendline of support. We made note of it in the weekend newsletter.

  James Brown   9/15/200,  2:04:01 PM
Just a reminder... the Stock Trader's Almanac records that September's option expiration Friday has the Dow Industrials down 8 out of the last 13 years. We could see the current weakness continue into the weekend.

  Mark Davis   9/15/200,  2:02:13 PM
It's very tempting to try a short right here @ 1123.20 but that was a pretty nice move and could go all the way to 1124 or 1125... at 1125 I don't know if I'd be able to resist a short with a tight stop.

  Linda Piazza   9/15/200,  1:56:21 PM
Here's where the OEX is with respect to the 30-minute 100/130-ema's: Link

  Jonathan Levinson   9/15/200,  1:56:01 PM
Session low for Nymex crude here at 43.675. Chart at this Link.

  Linda Piazza   9/15/200,  1:54:19 PM
The OEX again hits converging Keltner resistance on the five-minute chart, as well as approaching possible horizontal resistance near 543.87, the confirmation level of the potential double-bottom formation.

  Jonathan Levinson   9/15/200,  1:50:53 PM
QQQ failed at 35.25, but volume is the lightest it's been in hours and the wavelet oscillator is not following the price down for this little dip. With the 30 min cycle channel flattening and the oscillators oversold, the next likely 30 min cycle move should be to the upside, barring an oversold trending move. A break above 35.34 should get the ball rolling, but 35.25 is holding for the moment.

  Mark Davis   9/15/200,  1:46:39 PM
SPX stopped right at the 11:24 swing high @ 1122.25 and is dropping back a bit... just printed a sell signal @ 1121.85

  Linda Piazza   9/15/200,  1:45:40 PM
The OEX hasn't yet confirmed the double bottom, hesitating at the converging Keltner resistance on the five-minute chart. On the 15-minute chart, it's only one minute away from perhaps closing above the Keltner line that's currently at 543.49, it's first 15-minute close above that line all day . . . just closed above it by a few cents.

  Jonathan Levinson   9/15/200,  1:40:06 PM
QQQ has reached declining 7200-tick SMA resistance at 35.25. The short cycle oscillators are just beginning to perk up in oversold territory.

  Linda Piazza   9/15/200,  1:39:06 PM
At about the same time that the OEX hits the confirmation level of the potential double-bottom formation on its five-minute chart, it will be hitting converging Keltner resistance on the five-minute chart. If the OEX manages a 15-minute close above 543.48, though, it's suggesting a climb up to 544.08 and perhaps to 545.02, suggesting that the OEX will confirm that double-bottom and perhaps even hit the upside target suggested by such a confirmation. If the OEX does have a 15-minute close over the Keltner line currently at 543.49, this will be the first time today that the OEX will have seen a 15-minute close above that particular Keltner line.

  Mark Davis   9/15/200,  1:30:51 PM
Jonathan your chart is "purtier" than mine (I'm jealous). I'd love to use the "Neon" scheme for charts, which is black background with red and green candles. Things show up so much better... Link
... but readers who print out charts would have to buy a LOT of black ink cartridges... not good

  Jonathan Levinson   9/15/200,  1:30:40 PM
The 30 min cycle oscillators are trying to find a bottom in oversold territory, and while the 30 min channel in the QQQ chart posted below isn't yet flattened from its downphase, a move above 35.25 for longer than 3 or 4 minutes should be enough to do it. The short cycle oscillators, still trending, are taking a slight uptick, and above 35.30 we should see them turn up. A move above 35.34 for longer than a couple of minutes should do likely for the 30 min cycle indicators.

  Jeff Bailey   9/15/200,  1:29:14 PM
Day trade long alert ... for Taser Intl. (TASR) $42.32 here, stop $41.00, target $45.00.

  Linda Piazza   9/15/200,  1:28:31 PM
The SOX's attempted bounce off the nearly converging 20- and 30-sma's has not been convincing as yet.

  Jonathan Levinson   9/15/200,  1:21:06 PM
Thanks, Mark. Here's IB's 100-tick view: Link

  Mark Davis   9/15/200,  1:18:13 PM
Jonathan here's the 1-min QQQ chart showing the spikes and the MACD bullish kiss. Link

  Mark Davis   9/15/200,  1:16:48 PM
MACD bullish kiss on the 1-min QQQ chart... first sign of a "possible" break to the upside.
QQQ = 35.20
SPX = 1125.14

  Linda Piazza   9/15/200,  1:16:21 PM
The OEX has not yet confirmed the potential double-bottom formation, but it hasn't given up yet, either. The confirmation level is on a move above 543.87.

  Jonathan Levinson   9/15/200,  1:15:38 PM
My IB feed didn't pick up that second spike. Strange, that.

  Mark Davis   9/15/200,  1:13:07 PM
Jonathan I'm also showing the spike to 35.30 and then another spike to 35.35 three minutes later. Those spikes produced two CCI readings of +320 and +340... MACD is turning back down as I type but has not yet crossed. If it rolls over from here look out below but TRIN is dropping so just more confusion IMO until the logjam breaks. When/if it breaks there is a lot of stored energy for a move either way. I'm growing weary of microanalyzing so will just leave my stop in place and wait to see what happens.

  Jeff Bailey   9/15/200,  1:12:35 PM
October Crude Oil (cl04v) $44.75 +0.81% (30-minute delayed) .... a break below $44.60 could give equities a bid.

  Jeff Bailey   9/15/200,  1:06:05 PM
01:00 Internals at this Link

  Jonathan Levinson   9/15/200,  1:03:39 PM
There's corresponding volume, so it looks like a buy program just jammed the QQQ to 35.30 for a couple of seconds. It's back to 35.19 here as I type.

  Jonathan Levinson   9/15/200,  1:02:41 PM
Is that a bad print I just got to 35.30 QQQ?

  Mark Davis   9/15/200,  12:55:41 PM
stepping away for a few minutes...

  Linda Piazza   9/15/200,  12:55:31 PM
OEX bears don't want to see a move above 543.87, with such a move confirming the (almost) double-bottom in the OEX, and suggesting a move up to 545 or so. That would still be lower than a 50% retracement of the decline off yesterday's last 5- and 15-minute high, but it's still not a move most bears want to wait out, if not necessary.

  Mark Davis   9/15/200,  12:53:32 PM
SPX just printed a buy signal on the 1-min chart. Personally I don't trust it although it could be the real thing. I'm lowering my stop on the short from 1123.65 (break even) to 1121.65 just in case... might as well lock in some lunch money.

  Jonathan Levinson   9/15/200,  12:50:30 PM
QQQ is bouncing from the session low of 35.10, which lined up with lower trendline and Keltner support posted earlier. Because the short cycles are so oversold, any bounce can start a new upphase, but with trending oscillators false signals are very common. I'd be looking for a move above 35.25 confirmed with a break above 35.34 for starters.

  Mark Davis   9/15/200,  12:47:26 PM
That little headfake to the upside looks like it's about to resolve to the downside... approaching LOD and currently printing... I can't type fast enough... new LOD @ 1119.93 and bouncing weakly. Bears want to see 1120 taken out decisively, bulls want to see it hold. I can't really see any substantial support until SPX 1118 (weak) and then 1115 (stronger).

  Linda Piazza   9/15/200,  12:44:35 PM
Slightly lower low on the OEX. Bears don't want to see a quick bounce. Bulls do.

  Jeff Bailey   9/15/200,  12:41:30 PM
Overstock.com (OSTK) $34.00 +2.41% .... stock has been on the move and bucking trend today.

  Jonathan Levinson   9/15/200,  12:40:54 PM
Gold has risen slightly, still lower by 90 cents at 406.60, and HUI and XAU are both slightly lower, -.96% and -1% respectively. Bonds are lower but no significantly, TNX +2 bps at 4.151%.

  Mark Davis   9/15/200,  12:39:47 PM
The current opex cycle isn't nearly as much fun as the last one is it? That could change at any moment but so far this week's trading has been very difficult, to say the least.

  Linda Piazza   9/15/200,  12:33:25 PM
OEX bears should continue lowering their stops along with the OEX. They would prefer to see a lower five-minute low produced soon, with the previous low at 542.82. Currently, Keltner charts show that nearest resistance gathers near 543.40 on the five-minute chart and nearer 543.50-543.60 on the 15-minute chart. Bears continue to see the preferred 15-minute closes beneath the Keltner line currently at 543.50, but this waiting out a new low makes bears nervous, and nervous bears can decide to cover their short positions.

  Mark Davis   9/15/200,  12:31:29 PM
Watch the LOD on SPX @ 1120.07 for a potential bounce or failure. SPX is currently printing 1120.78 and that's probably close enough to LOD for resolution of the logjam to occur at any time.

  Jonathan Levinson   9/15/200,  12:30:23 PM
QQQ 2-day 100 tick chart update at this Link.

  Jeff Bailey   9/15/200,  12:29:32 PM
Cyberonic (CYBX) $22.78 +20.46% .... stock moving past today's takeover bid of $22.00 from Advanced Neuromodulation Systems.

  Mark Davis   9/15/200,  12:27:21 PM
The lack of movement in either direction is amazing. I have to think if you "guess right", and that's all it is at this point, you will have a very nice trade sometime before EOD.

  Linda Piazza   9/15/200,  12:26:55 PM
Nope. The OEX broke through that converging support on the three-minute chart instead of bouncing from it. That support looked strong, certainly strong enough to bounce the OEX back up to test 543.50-543.60. That tells us something about the selling pressure, doesn't it?

  Jonathan Levinson   9/15/200,  12:24:00 PM
QQQ is breaking the previous low here. Channel and trendline support intraday is at 35.10 QQQ. The short cycle bullish divergences are in trouble on the Macd and TRIX oscillators, while the short cycle stochastics are just trending in oversold.

  Linda Piazza   9/15/200,  12:22:11 PM
TRIN has been moving down since about 10:35. The advdec line has been climbing since that time, but only slightly. I'm not sure either move is significant, but Jane has warned us to pay attention to the trend of the TRIN, too. In this case, it may just be pulling back from this morning's excessive level and markets could be readying for another wave of selling this afternoon, but bears should pay attention because a downward trend in the TRIN threatens them and not bulls. So far, the TRIN's empirical level is still very bearish, and so far, the OEX has not shown anything that would threaten bearish positions, but I'm not sure that the OEX is through attempting to climb within that potential bear flag. In fact, if the three-minute Keltner chart has any relevance, as it frequently does, the OEX is just about getting ready to bounce again and it may find it easier to do so than it has since early this morning. I'm not sure how far that bounce will take the OEX, but bears should have a profit-protecting plan in place in case the OEX does bounce and the bounce goes too far.

  Jonathan Levinson   9/15/200,  12:19:16 PM
Session lows for INTC and NQ here. QQQ is one cent away.

  Jeff Bailey   9/15/200,  12:19:13 PM
Taser Intl. (TASR) $42.00 +18.81% ... updated bar chart with previously shown fitted retracement at this Link

That may have been a "bad tick" at $46.00, but may make sense near-term as it relates to market maker activity.

May look to round to full on any TASR pullback to $38.16 area.

  Linda Piazza   9/15/200,  12:16:26 PM
The OEX is still closing 15-minute periods where it needs to close them, but it certainly keeps trying to push above that Keltner resistance. Further Keltner resistance is coursing down to converge with the lower line, though, with that other Keltner line now dipping to 543.95. I've been expecting a pop up to test that second Keltner resistance line on the 15-minute chart, and the last period did get close to a test of that line before the OEX dipped and closed beneath the lower Keltner resistance. I'm not sure if that was enough of a test, though.

  Mark Davis   9/15/200,  12:16:01 PM
Sideways for 2 hours now... there is definitely some pent up energy for whichever way it breaks.

  Jonathan Levinson   9/15/200,  12:14:03 PM
30 min channel resistance for QQQ has declined to 35.10 here. A break below 35.18 sets up 35.10 as the next downside target.

  Linda Piazza   9/15/200,  12:12:02 PM
The SOX is back to the 20-sma that proved so important in its trading pattern over the last month. It was just Friday that it eked out a daily close above that average for the first time since late June, and then Monday saw a strong gain that took it up to test the 50-dma. Since then, the SOX appears to be in the process of producing a possible bearish evening-star reversal signal. It's not quite in classical form, but close enough that SOX bulls need to see the SOX bounce strongly here to avoid the SOX closing with that tall red candle that it's been producing today.

  Jeff Bailey   9/15/200,  12:10:52 PM
Taser Intl. (TASR) $43.00 +21.6% ... released for trade alert.

  Jonathan Levinson   9/15/200,  12:10:17 PM
Nymex crude has eased back from its highs, currently trading +.45 or +1.01% at 44.85.

  Jeff Bailey   9/15/200,  12:07:57 PM
Altera (ALTR) $19.32 -4.26% .... moves to session low.

  Jonathan Levinson   9/15/200,  12:05:41 PM
QQQ chart update at this Link . Aside from that huge positive volume surge at 11:41, it's been a very quiet morning.

  Jeff Bailey   9/15/200,  12:05:12 PM
Taser Intl. (TASR) ... option chain. Link Not sure where stock will open when trading resumes, but I'm looking at selling a covered call in the Oct. $55, if I could get more than $2.00 or more.

As previously profiled, I'm in at Dec. $45 strike + $10.50 =$55.50, so that ($55.50) is break-even point right now.

  Linda Piazza   9/15/200,  12:00:28 PM
Here's how the OEX looks right now with respect to its 30-minute 100/130-ema's: Link The red trendline is one version of the rising trendline off the 8/13 low, broken this morning. The current potential bear flag is rising from the 130-ema, up toward the 100-ema.

  Linda Piazza   9/15/200,  11:56:30 AM
With one four-cent exception, the OEX is still producing 15-minute closes beneath the Keltner line that bears most want to see those candles close beneath. That line is now at 543.67. The next Keltner resistance, currently at 544.03, is cycling down to meet the other line. Resistance and support lines separate a bit, though, on that 15-minute chart, as the OEX attempts a possible bear-flag rise off today's low. One problem for bears lies in deciding where to put stops to protect profit. If this is a bear flag, it could retrace as much as 50% of the decline that preceded it, with that decline a steep one. If you consider the decline that preceded it to be the decline off yesterday's last five-minute high, one legitimate possibility, then the OEX could move as high as 545.33, the 50% retracement of that decline, as long as it was moving higher in the tight back-and-forth of a typical bear flag, and still be a potential bear flag. That's a lot of profit to give up, however. If you consider the last decline preceding this bear flag to be the decline that started after the last tepid rise on the five-minute chart, a decline that started on the 10:15 candle, then the 50% retracement level is at 543.76. The OEX did retrace higher than that, but only five-minute candle shadows reached that high. The candle bodies themselves formed beneath that 50% retracement line. These are a couple of possibilities to consider, but no "right" level exists. A lot depends on account size, the intention to daytrade or position trade, the expiration date of the option purchased, and other factors.

  Jonathan Levinson   9/15/200,  11:55:36 AM
NQ to a session low here but not QQQ.

  Jeff Bailey   9/15/200,  11:53:20 AM
Xilinx (XLNX) $27.14 -6.54% .... moves to session low.

  Mark Davis   9/15/200,  11:51:17 AM
My screen looks like they've halted the entire market... everyone watching Martha???

  Jeff Bailey   9/15/200,  11:50:37 AM
Taser Intl. (TASR) $38.00 +7.49% ... still halted. Here's recent news article regarding news of England's Home Secretary authorizing the TASER M26 stun gun usage by police. Link

  James Brown   9/15/200,  11:47:36 AM
I noticed that Mark but I can't see why the NASDAQ would halt shares for that reason.

  Mark Davis   9/15/200,  11:46:29 AM
James Reuters is reporting that the UK has approved Taser stun guns.

  James Brown   9/15/200,  11:44:02 AM
Shares of TASR have been halted.

  Mark Davis   9/15/200,  11:40:05 AM
SPX has just printed a sell signal, although on days like today 1-min charts become very unreliable as a TA tool. They work best for picking inflection points in the chop. Once a market begins trending they give lots of false signals both ways... for now I'm going with the trend until the trend changes.

  Jonathan Levinson   9/15/200,  11:39:34 AM
The 30 min cycle oscillators are continuing their downphase, but the bulls have been running the clock for the last 2 hours with little net change during that time. If 35.18 QQQ support is going to hold, I'll be looking for a 30 min cycle upphase to kick off early this afternoon, and a test of 35.45 resistance followed by 35.65. A lower high below yesterday's high would signal daily cycle weakness, while a higher high above that 35.70 level would extend the ongoing daily trending move in that timeframe.

  Linda Piazza   9/15/200,  11:35:51 AM
The just-concluded 15-minute period saw an OEX close $0.04 above the Keltner line that bears most wanted to see that period close beneath, but the OEX is headed lower beneath that Keltner line again. The current 15-minute pattern looks like a possible bear flag, and it could retrace significantly more of the decline than it has so far without undoing that possibility, however. If 15-minute closes continue above that Keltner line, currently at 543.69, then bears continue to hope to see 15-minute closes beneath 544.15.

  Mark Davis   9/15/200,  11:30:45 AM
The only positive sign I can see at this point is the positive MACD divergence for the last 1 1/2 hours. We're starting to see a slight uptick here but it is producing overbought CCI readings. We may be seeing the initial stages of a bounce but if it rolls over from here look out below. The move could be pretty strong considering the last hour has been sideways, storing up energy, and the fact that SPX has been unable to mount any serious upside movement in that hour. I have my stop set @ break even... 1123.65, maybe a little too close to the action but if the stop is taken out I'll be looking to get short again on a failure in the 1125 area.

  James Brown   9/15/200,  11:29:16 AM
FYI... early this morning the U.S. issued a travel warning for Indonesia.

  James Brown   9/15/200,  11:27:45 AM
Uh-oh! Investors don't appear happy with Reynolds American (RAI) mid-quarter update today. The company reaffirmed guidance and shares are down 1.9% and giving up all of yesterday's gains. Currently the stock is trying to bounce from $73.80 where it found support a couple of days ago.

  Jonathan Levinson   9/15/200,  11:27:31 AM
QQQ update at this Link showing a descending channel break to the upside, but a failure so far at 35.34. The short cycle oscillators are still trying to perk up, but no real movement in price so far.

  Linda Piazza   9/15/200,  11:24:18 AM
OEX bears would like to see a 15-minute close beneath the Keltner resistance line that the OEX is currently testing, with that line at 543.75 as I type. If that doesn't happen, then they want to see a 15-minute close beneath the Keltner line currently at 544.28. It will take a 15-minute close above the Keltner line currently at 545.30 to turn the smallest Keltner channel higher again, though.

  Jonathan Levinson   9/15/200,  11:24:06 AM
QQV is up 4.7% at 18.7 currently. VXO +8.58% at 14.55.

  James Brown   9/15/200,  11:23:37 AM
Best Buy Co (BBY) is up more than 4% and breaking out over its simple 200-dma after reporting earnings this morning. Wall Street was looking for 52 cents a share. BBY turned in 53 cents on revenues of $6.08 billion, which is just a hair under consensus. Management guided in-line for the next quarter.

  Linda Piazza   9/15/200,  11:22:11 AM
After falling out of its bear flag and below the neckline of a H&S on its 30-minute chart, the BIX is now attempting to complete an evening-star reversal pattern on its 30-minute chart, heading up again to test that broken support. This 30-minute period is not finished yet, though, and the BIX needs to maintain the current 30-minute period's tall white candle to complete that reversal signal.

  James Brown   9/15/200,  11:20:10 AM
Nice timing.... now that semiconductor-chip maker NVDA has filled the gap from early August UBS has downgraded the stock to a "reduce".

  James Brown   9/15/200,  11:18:59 AM
Jim Jubak on CNBC saying there is a supply-demand squeeze in the trucking business. There are not enough trucks or more specifically there aren't enough drivers for the demand out there right now. He suggests that trucking companies should do well as we move into their busy season (Q4 shopping season). He likes ABFS and YELL and believe they have another six months to run higher.

  Linda Piazza   9/15/200,  11:18:41 AM
The OEX continues to be pressured lower by the Keltner resistance lines currently near 543.36, continuing to show five-minute closes beneath this first Keltner resistance it's encountering on the five-minute chart. I'm not certain, though, that it will continue to do so, and that it might not pop up to test next Keltner resistance, with those lines now near 543.87. . . may be doing so as I type.

  Jonathan Levinson   9/15/200,  11:16:38 AM
The Fed has announced a coupon pass in the amount of 800M, which is a permanent market operation that adds permanent liquidity. For today, the net change is now +1.05B.

  James Brown   9/15/200,  11:15:37 AM
Guidant (GDT) is up 1.5% and hitting new three-month highs after the FDA approved a wider group of potential patients for GDT's defibrillators and heart-therapy devices.

  James Brown   9/15/200,  11:12:02 AM
Prudential is upgrading some oil refiners... Valero (VLO), Sunoco (SUN) and Tesoro (TSO).

  Jonathan Levinson   9/15/200,  11:11:51 AM
The wavelet cycle for QQQ is just starting a downphase here.

  Mark Davis   9/15/200,  11:10:50 AM
B-bands are getting pinched very tight here. If bulls don't press very soon I think we will be looking at the next leg down.

  James Brown   9/15/200,  11:10:39 AM
Morgan Stanley is downgrading auto-parts markers Delphi (DPH) and Visteon (VC) to equal-weight this morning. Remember that it was only a couple of weeks ago that General Motors cut its Q4 production numbers.

  James Brown   9/15/200,  11:07:48 AM
Dow-component Verizon Communications (VZ) is suffering a bit. Shares are down 2% and breaking round-number support at $40.00 after Deutsche Bank downgraded VZ to a "hold".

  Jonathan Levinson   9/15/200,  11:06:40 AM
Below 35.18, the bullish divergences should begin to roll over, which would be the start of a bearish short cycle trending move for QQQ.

  Linda Piazza   9/15/200,  11:06:16 AM
The OEX is attempting a flag-ish type climb, so far turning back at the first Keltner resistance it encountered on the five-minute chart, with those Keltner lines near 543.45. I'm not certain that the OEX is through challenging that resistance, but if it breaks above it, next resistance on that chart is at lines currently from 543.84-544.03.

  Jeff Bailey   9/15/200,  11:05:47 AM
11:00 Internals at this Link

  Jonathan Levinson   9/15/200,  11:02:24 AM
The short cycle oscillators are looking bottomy, with with a bullish divergence on the short cycle Macd and TRIX divergence against the lower price lows of the past hour. A move above 35.34 QQQ targets 35.45, above which the short cycle upphase will be confirmed.

  Jeff Bailey   9/15/200,  10:57:39 AM
10:52 Market Watch at this Link

  Linda Piazza   9/15/200,  10:57:11 AM
The Russell 2000 hit its 200-sma at 566.50, or rather came within a quarter of hitting it. The Russell 2000 has been attempting a bounce since then, although it's a rather tepid bounce so far. That bounce began on the 10:35 five-minute candle, as did the OEX's, the Dow's, the SPX's . . . you get the message. The approaches of these indices to their 200-sma's are potential bounce points, and potential bounce points for all the indices and not just the one in question, so it pays to watch.

  Linda Piazza   9/15/200,  10:53:22 AM
All day, the OEX has been tumbling and then attempting a rise or at least a steadying that usually occupies or four five-minute bars. The current attempt to steady has progressed longer, and so may be slightly stronger. Nearest resistance on the five-minute Keltner chart lies at 543.48-543.59 and then again at 544.15-544.22. Bears want to see five-minute closes beneath one of those two resistance zones, preferably below the lowest. Remember that Keltner lines are dynamic and that these zones will shift slightly as the OEX moves.

  Jonathan Levinson   9/15/200,  10:53:20 AM
QQQ 100-tick 2-day chart update at this Link.

  Jeff Bailey   9/15/200,  10:49:19 AM
Altera (ALTR) $19.50 -3.36% .... "like stock" to XLNX. WEEKLY R1 $20.15, WEEKLY Pivot $18.83. Session low so far has been $19.34.

Thinking if XLNX gives up its WEEKLY Pivot, ALTR vulnerable to its WEEKLY Pivot.

  Jeff Bailey   9/15/200,  10:44:36 AM
Xilinx (XLNX) $27.43 -5.54% .... if looking for one stock "to blame" for weakness in SOX.X and QQQ, this would be it today.

Session low has been $27.18, with WEEKLY pivot holding support at $27.17.

SOX.X 382.86 -2.7% ... session low has been 381.92

  Jonathan Levinson   9/15/200,  10:39:52 AM


Crude is up 75 cents to 45.15 currently, a 1.69% move.

  Jonathan Levinson   9/15/200,  10:36:07 AM
QQQ has also broken its previous lows, but the process has been laborious so far. While the 30 min bearish divergence is cofirmed with a 30 min cycle downphase in progress, the selling hasn't been as sharp as I would have otherwise expected. A break below 35.18 will get the ball rolling, however, and the gap down open at 35.45 was never retested. The outlook is bearish below that level, and particularly so if we break 34.92 today. New lows across the board here as I type.

  Linda Piazza   9/15/200,  10:35:45 AM
Now that there's a breakdown signal on the OEX's five-minute Keltner chart, I'm turning to the 15-minute chart to set a potential new target, based on channel support on that chart. As long as the OEX maintains 15-minute closes beneath the Keltner line currently at 544.03, bears can target 540.30. Bears want 15-minute closes beneath that level or at least beneath the channel line currently at 545.08.

Bear in mind the strong historical support from 540.80-542, with bounce potential anywhere within that zone. Keltner's don't show historical S/R levels but instead are based on moving averages. Sometimes they amaze me when they show no support where I would think there should be support or when they suddenly converge near historical support.

  Linda Piazza   9/15/200,  10:32:15 AM
The Russell 2000 nears a test of its 200-sma, with that average at 566.50 and the Russell 2000 at 568.22. The Dow continues to fall lower beneath its 200-sma. The SPX is still almost 6 points above its 200-sma at 1115.03. Bears should be particularly watchful of further index tests of their 200-sma's.

  Linda Piazza   9/15/200,  10:30:15 AM
The OEX tests its 10-dma at 543.88. The OEX has occasionally pierced this average over the last month, but has not closed beneath it since mid-August. This could be a possible bounce point, too, then, or a possible sign that the trend has changed. If there's a five-minute close beneath 543.92 (as there was as I typed), the OEX has created a breakdown signal on the five-minute chart. Bears should therefore be following the OEX lower with their stops. Usually these breakdown signals suggest that risk has shifted to those in bearish positions, but since Keltner channels were created to identify and trade breakouts, it doesn't usually suggest that it's time to shift sides. Bears are at risk of a bounce at any time, but bulls are at risk of trying to catch a falling knife.

A special note to bears about risk. The TRIN is approaching levels not seen since 8/30, as Jane or others may have already noted. Although the OEX slipped a little lower on 8/31 and consolidated at that slightly lower level, it then began a climb straight up into the recent high. While I would only use this as a warning to guard bearish profits and not as a sign that bearish plays should necessarily be exited this moment and bullish ones entered, it does serve a possible warning. It could also just be saying that selling pressure is intense.

  Mark Davis   9/15/200,  10:26:09 AM
SPX printed another buy signal at the last swing low but I don't trust it. Today looks like a trending day, and a fairly strong one at that. I took a short postition on that very weak bounce to 1123.65. I don't see much to support the index until about SPX 1118 so that's my first downside target, followed by pretty strong support @ 1115.

  Jeff Bailey   9/15/200,  10:25:32 AM
Current OPEN MM Profiles at this Link

  Jonathan Levinson   9/15/200,  10:24:59 AM
QQQ is back to session lows at 35.27, failing from a lower high. Next support below this level is 35.18, following which there's stronger support in the 34.92-.93 area.

  Linda Piazza   9/15/200,  10:23:09 AM
The TRAN bounced back from the day's low and is kind of holding steady at the 3223-3225 level, where it's been opening and closing over the last week. For a long while, I've had a horizontal S/R line drawn at this level, as it showed some importance in the late 90's. (I haven't had that line drawn that long, though!) Anyone doubting that the market has a long memory only needs to watch the last four days of trading when there have been opens, closes, and oscillations around that line. Some daily chart oscillators are showing tentative bearish divergence with comparison to the early July swing high, with prices slightly higher now and oscillator highs lower, but that divergence can be erased.

  Jonathan Levinson   9/15/200,  10:20:30 AM
Session low for ES here. QQQ is holding at 35.31.

  Linda Piazza   9/15/200,  10:16:53 AM
The OEX's drop today has been so quick that I'm waiting for resistance lines to converge to give you a good idea of where strongest resistance might lie overhead. So far, resistance tries to converge at 545.02-545.15. More resistance lies at a line now at 545.45. As long as the OEX maintains five-minute closes beneath those levels, preferably below the line currently at 545.15, it's still likely to head down toward next Keltner support, currently at 544.00.

  Jeff Bailey   9/15/200,  10:13:46 AM
10:00 Internals at this Link

Yesterday's Internals at this Link

  Linda Piazza   9/15/200,  10:13:13 AM
The OEX has already exceeded the 544.90-ish downside target of this H&S-ish formation: Link

  Mark Davis   9/15/200,  10:12:52 AM
The biggest gainer by far this morning is $TRIN, currently printing 1.54, +87.80%. It's too bad $TRIN doesn't have an option chain.

  Jonathan Levinson   9/15/200,  10:09:46 AM
QQQ is bouncing from a retest of 35.27 support, and double bottoms can sometimes serve as a launchpad for the buybots. However, the volume is so far very weak on this rebound, and it feels corrective so far. The short cycle downphase continues, and it will take a move at least above 35.45 to get an upphase started.

  Linda Piazza   9/15/200,  10:07:31 AM
The BIX has broken beneath the neckline of its H&S on its 30- and 60-minute charts and below the possible bear-flag that brought it off its 9/09 low.

  Linda Piazza   9/15/200,  10:06:34 AM
Perhaps someone has already noted this, but the Dow has broken beneath its 200-sma at 10,285.60, with that number provided by Stockcharts.com. The SPX and Russell 2000 are still above their 200-sma's.

  Jeff Bailey   9/15/200,  10:06:31 AM
10:00 Market Watch at this Link

  Jeff Bailey   9/15/200,  10:03:58 AM
Taser Intl. (TASR) $38.00 +7.5% ... works its way above bearish resistance trend.

Little "zone of resistance" from fitted retracement here $37.36-$38.16.

Break above this paves way to $42.00.

  Linda Piazza   9/15/200,  10:03:20 AM
This isn't even a measured distribution type bounce on the OEX, at least not yet. It's not any kind of bounce. It looks more like a "b" distribution pattern that just failed to the downside as the OEX continues its slide down toward next Keltner support at 544.03 on the five-minute chart.

I have to correct a post I made earlier about the 30-minute 100/130-ema's. That was actually the 20-minute 100/130-ema's. I'd been experimenting last night, finding a great correlation with those averages. It's been hard to find a time when the OEX hasn't at least paused through about an hour at the 30-minute 100/130-ema's if not bounced from them. Still, the OEX is heading right back down as I type to test the 20-minute 130-ema at 544.65 . . . oops, it's slipping through it now, heading toward the 30-minute versions. The 20- and 60-minute actually have more correlation with trading patterns lately, though, than the 30-minute ones, with the 60-minute 100/130-ema's now at 541.85 and 540.70, respectively.

  Jonathan Levinson   9/15/200,  9:59:43 AM
Nymex crude currently trading -.05 at 44.35.

  Jonathan Levinson   9/15/200,  9:59:26 AM
QQQ 100-tick 2-day chart update at this Link.

  Jeff Bailey   9/15/200,  9:55:57 AM
Taser Intl. (TASR) $37.00 +4.66% Link .... testing bearish resistance trend here.

  Jonathan Levinson   9/15/200,  9:54:05 AM
The Fed has announced a 7B overnight repo against the 6.75B expiring, for a small net add of 250M.

  Linda Piazza   9/15/200,  9:50:12 AM
What I would expect now is a labored climb, perhaps in some sort of measured distribution pattern. Hopefully, it will be of a form that will allow us to note a breakdown, such as a bear flag, or an upside breakout, if the OEX should surprise us.

  Mark Davis   9/15/200,  9:49:32 AM
SPX has just printed a buy signal but that was a pretty nasty open. Hopefully we will get a bounce here but so far it is weak. It wouldn't take much more downside to turn the very tentative buy signal into a MACD bearish kiss, resulting in an early abort. Bulls do not want to see Monday's swing low @ 1123.35 taken out. TRIN is printing 1.40

  Jonathan Levinson   9/15/200,  9:48:59 AM
Volume is relatively lighter on the bounce, but a light volume bounce is still a bounce. The short cycle oscillators are oversold and so far only the wavelet oscillator is registering the move off the lows, but above 35.45 we should have a new short cycle upphase in progress.

  Linda Piazza   9/15/200,  9:48:50 AM
After overshooting that descending trendline off the 8/13 low, the OEX is only now attempting a bounce during this first reversal period of the day. Nearest Keltner resistance on the five-minute chart lies at 545.39-545.57, with that trendline just over that, at about 545.80. I'm going to be following the 30-minute 100/130-ema's, too, as the OEX hit those averages and is bouncing exactly from the 130-ema at 544.65. The 100-ema on that chart is at 545.28. I expect some consolidation and/or a bounce now, but now we have to question whether the bounce will be up to the 200-sma again or only to that former supporting trendline. Of course, we also have to keep an open mind and realize that the OEX and other indices could surprise us all and zoom straight past both those levels.

  Jonathan Levinson   9/15/200,  9:44:14 AM
QQQ bounced from 35.27, and is now testing 35.34 from below.

  Jonathan Levinson   9/15/200,  9:43:26 AM
Gold is holding its earlier losses, down 1.40 at 406.10, with HUI down .61% at 207.47 and XAU -.63% at 94.1. 408 resistance was not broken yesterday, and weak support is at 405, followed by strong support at 398-402.

  Linda Piazza   9/15/200,  9:41:55 AM
After overshooting the neckline of its inverse H&S on its five- and fifteen-minute charts in the last five minutes of trading yesterday, the TRAN immediately turns back below that neckline this morning, dropping back to the right shoulder level. While a second right shoulder could be forming, and the TRAN is trying to firm up at Keltner support just above 3218, this isn't bullish behavior.

  Jeff Bailey   9/15/200,  9:41:35 AM
Pepsico (PEP) $49.76 -1.56% Link .... lower in sympathy with KO.

  Jeff Bailey   9/15/200,  9:39:54 AM
Coca-Cola (KO) $40.55 -5.41% Link .... 52-week lows and breaks some formidable support with spread-triple bottom sell signal at $42.00.

  Jonathan Levinson   9/15/200,  9:39:14 AM
35.34 is getting tested here, with a session low currently printing 35.32. 35.27 is confluence from yesterday, following which 35.18 comes into view.

  Linda Piazza   9/15/200,  9:38:57 AM
The BIX tests bottom support of the rising regression channel on its 30- and 60-minute charts, a possible bear flag. It's continued a bit too long to be a bear flag, but it hasn't been able to maintain values above a 50% retracement of the decline that preceded it, so it meets the parameters by that measure, at least. Banks performed strongly in Europe, but a downturn in banking stocks did contribute to the afternoon plummet in the Nikkei last night. Mixed expectations across the globe. Note: As I typed, the BIX began falling beneath that support, but hasn't confirmed it by a 30-minute close below it.

  Jeff Bailey   9/15/200,  9:37:40 AM
Sector weakness has SOX 386.72 -1.72%, Networking (NWX.X) 222.89 -1.57% and Combined Telecom (IXTCX) 177.76 -1.32% early losers.

No sectors up more than 1%.

  Linda Piazza   9/15/200,  9:36:41 AM
The OEX has now set up a potential downside target of 544.31. Resistance could now be expected to be found near 545.80-545.90.

  Jonathan Levinson   9/15/200,  9:36:17 AM
Session lows for QQQ, as well as euro and CDN dollar futures here.

  Linda Piazza   9/15/200,  9:35:04 AM
The OEX has dropped exactly to the rising trendline off the 8/13 high. I would expect consolidation or a bounce attempt from this level, and that's when we'll see what this market really has in store, in my opinion. A drop through this trendline would mark a change in trend, but the OEX would then soon move into levels where there might be multiple support zones.

A special note: on a quick drop this morning, during amateur hour, premiums are sure to be inflated. Those hoping for a new bearish entry might hope for a bounce and rollover, at which time premiums might be less inflated. That may not happen, of course, if bearishness is strong enough, and the OEX does not appear to be dropping beneath that trendline. Those already in bearish positions should be making plans to protect profit in case there's a strong bounce during the first reversal of the day.

  Jeff Bailey   9/15/200,  9:34:27 AM
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  Jonathan Levinson   9/15/200,  9:33:13 AM
There's no bounce so far, and the 30 min cycle channel for QQQ is now pointing lower. It will take a move to the 35.60 QQQ area to abort the downphase. Next confluence suipport is at the 35.34 level.

  Jonathan Levinson   9/15/200,  9:27:46 AM
Bearish divergence in the 30 min chart of the NQ futures (proxy for QQQ using premarket data): Link

  Jane Fox   9/15/200,  9:22:54 AM
Dateline WSJ - VIENNA, Austria -- OPEC will increase the cartel's oil production by one million barrels a day to meet the global demand for oil, Kuwait's oil minister said Wednesday.

Sheik Ahmad Fahad al-Ahmad al-Sabah, Kuwait's oil minister, said the cartel agreed to the decision to raise output by nearly 4%, adding it would take effect Nov. 1.

The decision will increase OPEC's self-imposed output limit for all its members, except Iraq, from 26 million barrels a day to 28 million barrels, bringing the cartel in line with actual output, which stands at more than 27.4 million barrels. A decision whether to increase the price band would be made at a meeting Dec. 6 in Cairo, Egypt.

  Linda Piazza   9/15/200,  9:21:06 AM
With futures lower this morning, we'll look first for an OEX test of Keltner support near 546.70 on the five-minute chart. A decline beneath the Keltner lines currently at that level, complete with five-minute closes beneath those lines, might set up a test of that rising trendline off the 8/13 low, with that line currently crossing at about 545.75. I would expect at least consolidation or a tepid bounce attempt from that level, if not something more. Be reminded that anyone taking bearish positions in this market is doing so ahead of a test of the 200-sma on the SPX and the Russell 2000, and possibly the Dow, although the Dow's 200-sma is not so far below the current position and KO's warning this morning may help push it closer. Those approaching 200-sma's may be all the more reason to expect bounce attempts, although the season's pattern would suggest that they'll eventually fall. We'll just have to see, though, remaining open to the possibility that indices are going to break to the upside instead.

  Jonathan Levinson   9/15/200,  9:20:02 AM
Equities are slightly lower, but most notably not any higher following the 9:15 data, and so there will be a gap down cash open. QQQ is sitting on 30 and 60 min channel support here, and a failure to bounce back into the gap immediately from 9:30 will see the 30 min channel (currently flat) roll over.

  Jim Brown   9/15/200,  9:15:12 AM
Industrial Production = +0.1%, (est +0.4%, last +0.4%)
Capacity Utilization 77.3%

  Jonathan Levinson   9/15/200,  9:10:29 AM
Awaiting the Industrial Production and Capacity Utilization data in 5 minutes.

  Linda Piazza   9/15/200,  8:57:53 AM
The MBA Refinancing Index was released this morning. Mortgage application volume declined due to the holiday-shortened week, the MBA announced. The composite number fell a seasonally adjusted 2 percent from the previous week. The seasonally adjusted Purchase Index and Refinance Index fell 4.3 and 1.2 percent, respectively. The average interest rate for 30-year, fixed-rate mortgages fell to 5.68 percent from the previous week's 5.79 percent.

  Jonathan Levinson   9/15/200,  8:49:14 AM
Bonds remain weak, with ten year note yields (TNX) currently higher by 1.8 bps at 4.151%.

  Jonathan Levinson   9/15/200,  8:33:27 AM
Bonds are at session lows, with TNX up 1 bp at 4.143%. Equities didn't dip much on the data and are holding the bulk of their pre-data losses.

  Jonathan Levinson   9/15/200,  8:32:40 AM

  Jonathan Levinson   9/15/200,  8:31:40 AM






  Jonathan Levinson   9/15/200,  8:10:51 AM
We await the 8:30 release of July business inventories, est. .8% and the Empire State Index, est. 20. At 9:15 we get Industrial production for Aug., est. .5%, and Capacity utilization, est. 77.4%.

  Jonathan Levinson   9/15/200,  8:09:12 AM
Equities are lower today, with ES trading 1126.75, NQ 1429.5, YM 10299 and NQ -.23 at 35.40. Gold is down 1.20 at 406.30, silver -.015 at 6.221, ten year treasury bonds -.046 at 112.594 and Nymex crude oil -.075 at 44.325.

  Linda Piazza   9/15/200,  7:20:24 AM
Good morning. The Nikkei opened in the red as oil prices rose ahead of this week's OPEC meeting and Ivan's landfall, and after further attacks on Iraqi pipelines. After opening, the Nikkei attempted a push toward 11,300, and then dropped through the rest of the day, closing on its low of the day. It closed down 137 points or 1.21%, at 11,158.58. Early in the session, Toyota and Fuji Photo dropped, as did most exporters, especially tech stocks. Canon and Toshiba both declined after announcing planned investments in their joint venture on flat-panel screens. Toyota Motor announced that it would begin manufacturing its Prius hybrids in China by the end of 2005. Toward the end of the session, banks also turned lower, contributing to the plummet at the end of the session. Seven-Eleven Japan was an early gainer after a newspaper report that the company would raise its dividend payment after seeing half-yearly profits rise, and it closed higher by 0.9%.

Other Asian markets turned in mixed performances. The Taiwan Weighted fell 0.82%, and South Korea's Kospi fell a more modest 0.09%, both slipping lower after index compiler FTSE declined to raise their status to developed market status. Singapore's Straits Times rose 0.49%, but Hong Kong's Hang Seng declined 0.48%. China's premier reportedly soothed investors by saying steps would be taken to protect their interests and guarantee sound progress in capital markets. The Shanghai Composite rose 4.22%, to 1,355.226.

Currently, most European bourses trade higher. In the U.K., banks trade higher, with HBOS surprising markets after saying that it was not going to bid against Spain's Banco Santander for Abbey National. Speculation rose about other banks that might now enter the bidding for Abbey National. Many financials also rose in Europe, with Deutsche Bank gaining after a CSFB upgrade to neutral from underperform. Banco Santander wasn't one of the banking stocks that gained in early trading, however, with the bank declining 1.5% at one point this morning after it detailed its plans for Abbey. Oracle competitor SAP rose. Luxury goods makers showed mixed performances after LVMH Moet Hennessy reported earnings that JPMorgan characterized as good in the headline numbers but disappointing in the divisional split. In the airline industry, Alitalia continued a strong run this week after reportedly coming to an agreement with its pilots, but French engine maker Snecma is being impacted by a US Airways bankruptcy.

As of 7:17 EST, the FTSE 100 had gained 23.80 points or 0.52%, to trade at 4,569.40. The CAC 40 traded higher by 3.69 points or 0.10%, at 3,711.71. The DAX traded higher by 8.69 points or 0.22%, at 3,956.44. The FTSE 100 has been on an upward trajectory all day while the CAC 40 and DAX have been turned down from overhead resistance ahead of the OPEC meeting.

  OI Technical Staff   9/14/200,  9:50:39 PM
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