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  Jim Brown   9/27/200,  5:24:38 PM
Alert - Oil has traded at $50 on Globex

 
 
  Jim Brown   9/27/200,  4:43:51 PM
AGIX trading up $17 at $40 in after hours on news that its plaque removing drug removes plaque from arteries and could reverse atherosclerosis without surgery.

 
 
  Jim Brown   9/27/200,  4:43:06 PM
DVN announcing 2:1 split, 10% buyback and move to the NYSE exchange.

 
 
  Jim Brown   9/27/200,  4:42:13 PM
VLO raising estimates from $2.58 to over $3.00.

 
 
  Jeff Bailey   9/27/200,  4:40:40 PM
Closing Internals at this Link

 
 
  Jeff Bailey   9/27/200,  4:16:52 PM
QQQ goes out at $34.50 -0.85% ....

 
 
  Mark Davis   9/27/200,  4:16:20 PM
I was just thinking the same thing Keene. The short from 1107 looks good but now we have to deal with SPX round number support @ 1100. As Gilda Radner put it so well... "It's always SOMETHING!"
Having said that, IF we drop through 1100 like it weren't there... I guess I shouldn't count my Velociraptors before they're hatched.

 
 
  Jeff Bailey   9/27/200,  4:11:05 PM
Current OPEN MM Profiles at this Link

Today's Activity ....

Day trade short Foundry Networks (FDRY) at $9.92, closed $9.84 ($0.08, or +0.81%).

 
 
  Jeff Bailey   9/27/200,  4:02:00 PM
Buy Program Premium ... SPY 110.76, QQQ $34.47, DIA $100.10

 
 
  Mark Davis   9/27/200,  4:01:39 PM
You da man Marc... Jane and Linda are da women

 
 
  Mark Davis   9/27/200,  3:59:38 PM
Me three Marc!

 
 
  Jonathan Levinson   9/27/200,  3:59:33 PM
QQQ is at lower 30 min and 60 min channel support here, with an intraday low printed at 34.38. If the bottom doesn't drop out quickly now, be on the lookout for a bounce to the prior low of 34.48. A failure there would be very bearish, while a break above targets 34.53 and 34.58.

 
 
  Jeff Bailey   9/27/200,  3:59:27 PM
Bearish day trade close out alert ... for Foundry Networks (FDRY) here at the $9.84 offer.

 
 
  Linda Piazza   9/27/200,  3:59:09 PM
Yes, congratulations, Marc.

 
 
  Mark Davis   9/27/200,  3:58:35 PM
Lowering stop on short to 1107.01 and break even, holding overnight. I don't have the courage to try a long play here and am happy to have +4 points in the bag for the overnight hold. I seriously doubt if there will be much movement to the upside ahead of tomorrow's numbers.

 
 
  Linda Piazza   9/27/200,  3:56:48 PM
It will soon be time to make a decision about holding overnight if in a bearish OEX position. If in a position on a downside break through 533.595, you have more than a couple of points cushion as I type, but perhaps not much cushion in options prices, depending on your strike. According to some calculations and chart characteristics, the OEX might have downside to 526-527, but that doesn't mean the drop will be straight down, even if that downside is achieved. OEX 530 will likely present some bounce potential, for example, with the OEX not so far from that potential bounce level. If a position is meant to be held for several days, different considerations might come into play. If not in a trade intended to be a daytrade, I'd feel comfortable holding overnight, particularly if the Dow closes beneath 10,000. Some might choose to bracket that trade with a long position if the OEX approaches 530 at the close. Economic numbers released tomorrow morning could be market-moving, so that should be factored into any decision.

 
 
  Jonathan Levinson   9/27/200,  3:55:41 PM
Session lows across the board. Note that QQQ 34.75 got tickled only for a few seconds with a spike print at 34.74. 34.38-.40 support is coming into view.

 
 
  Mark Davis   9/27/200,  3:52:59 PM
TRIN @ 1.50... fear creeping in but we still haven't had a clean break to the downside.

 
 
  Mark Davis   9/27/200,  3:49:58 PM
Long signal developing... CCI is right but MACD still pointed down. You almost have to frontrun these things lately to get a decent entry. Frontrunning the 1-min chart... now that's a laugh!

 
 
  Jonathan Levinson   9/27/200,  3:49:12 PM
Session low for YM futures at 9987. QQQ 34.49 here.

 
 
  Mark Davis   9/27/200,  3:47:52 PM
There goes Dow 10,000

 
 
  Mark Davis   9/27/200,  3:46:44 PM
MACD bearish kiss on the SPX 1-min chart and TRIN is up to 1.41... bulls had better get with it soon. Dow 10,000 is only 2 points below. Bulls do have a couple of things going for them though; a potential double bottom on SPX right at support and the window dressing Jim mentioned earlier, however every once in a while window dressing turns into window undressing.

 
 
  Linda Piazza   9/27/200,  3:45:23 PM
While the OEX has seemingly confirmed the continuation-form H&S on its five-minute chart, the SPX has not yet confirmed a similar formation.

 
 
  Linda Piazza   9/27/200,  3:41:50 PM
The OEX hits a new low of the day.

 
 
  Mark Davis   9/27/200,  3:41:45 PM
I'd love to see SPX drop close to LOD again so I could enter a concurrent long play and lock in about +2.5 points to hold overnight but that may not happen because a -1 point drop on SPX would definitely result in the Dow moving below its LOD (not to mention below 10,000). However, if there is a support break it could be swift and scary for bulls.

 
 
  Linda Piazza   9/27/200,  3:34:19 PM
Whew, Mark. I was afraid we really did have an hour and a half.

 
 
  Jonathan Levinson   9/27/200,  3:33:06 PM
The listless 30 min cycle channel is now drifting lower after a short uptick. The 60 min channel is finally catching up, only now flattening from its downphase. I expect a directional move on a break below below 34.40 or above 34.87. Within the 34.48-34.70 range, it's just meaningless chop at this point. If the daily cycle were oversold, that chop would look like a bullish consolidation, but because there's plenty of downside left on the daily, it looks bearish.

 
 
  Linda Piazza   9/27/200,  3:32:40 PM
The OEX drops down to test the neckline of its continuation-form H&S. It needs to reach a new low of the day to confirm that formation, though.

 
 
  Mark Davis   9/27/200,  3:32:24 PM
LOL Linda... you got me!

 
 
  Linda Piazza   9/27/200,  3:30:44 PM
Mark, either this day has been a lot longer already than I thought it was or we only have 1/2 an hour for the bulls and bears to slug things out. (15:27 post.)

 
 
  Linda Piazza   9/27/200,  3:29:25 PM
The TRAN looks as if it wants to steady and head higher; the OEX as if it wants to keel over.

 
 
  Mark Davis   9/27/200,  3:27:53 PM
Bears would love to see the Dow close below 10,000 today for the headline value. Bulls want just the opposite and they have 1 1/2 hours left to slug it out.
Benchmarking... Dow = 10012.95

 
 
  Jonathan Levinson   9/27/200,  3:21:16 PM
Unless volume picks up considerably in the next 40 minutes, the Dow and Naz will go out on lower volume today. QQQ has traded 73.4M shares so far, which looks light to me so far.

 
 
  Mark Davis   9/27/200,  3:19:26 PM
The sell signal that just printed on SPX is one of the "classic looking" variety. I'd be surprised if it aborts, but it wouldn't be the first time I was surprised by the market.

 
 
  Linda Piazza   9/27/200,  3:19:20 PM
The TRAN and OEX could now be beginning a rollover into right shoulders for their potential H&S's, but neither has confirmed and both could still reject the formation. I'm not being ambiguous or dodging a guess here: the truth is that until the formations have confirmed or been rejected, we just don't know which way these indices will go.

 
 
  Jonathan Levinson   9/27/200,  3:18:22 PM
Nymex crude has opened lower, currently down .10 at 49.55 for the evening session.

 
 
  Linda Piazza   9/27/200,  3:14:29 PM
Symmetrical triangle on the BIX's five-minute chart.

 
 
  Linda Piazza   9/27/200,  3:13:14 PM
Is MU the first chip stock to report in this cycle? It reports after the bell Wednesday.

 
 
  Mark Davis   9/27/200,  3:13:12 PM
SPX has just printed a short signal on the 1-min chart @ 1106.30

 
 
  Jeff Bailey   9/27/200,  3:11:38 PM
03:00 Internals at this Link

 
 
  Mark Davis   9/27/200,  3:10:15 PM
Exiting long early @ 1106.48, +2.25

 
 
  Linda Piazza   9/27/200,  3:10:00 PM
The OEX hit the potential right-shoulder level for its continuation-form H&S on its five-minute chart and did get slapped back. Let's see if the resistance holds.

 
 
  Mark Davis   9/27/200,  3:09:20 PM
Short @ 1107.01, stop 1108.01

 
 
  Linda Piazza   9/27/200,  3:08:51 PM
The TRAN has come right back up to a 50% retracement of the steep decline off Friday's high . . . and is popping above it as I type. Unless the TRAN is quickly slapped back, this may be undoing the possibility of a H&S on its five-minute chart. The 50% retracement is at about 3188.43.

 
 
  Mark Davis   9/27/200,  3:05:33 PM
Short signal very close to confirming... I may jump in early with a bracketing play.

 
 
  Jeff Bailey   9/27/200,  3:05:07 PM
03:00 Market Watch at this Link

 
 
  Mark Davis   9/27/200,  3:04:06 PM
I started out the day -5 points, just broke even, then pulled into the green slightly... just enough to pay for a large bottle of Maalox.
Still long from 1104.23 and will most likely hold overnight.

 
 
  Jonathan Levinson   9/27/200,  3:03:31 PM
It's impressive to see session highs and lows being retested hours later and holding to the penny for reversals- we've seen that twice today, and if not for the brief doji spike to 34.74, it would have been three times. 34.60 QQQ is being tested now from below, with a wavelet upphase extended but not yet topped. I'd expect a rollover by 34.62, above which it will begin trending in overbought to target 34.70 again.

 
 
  Linda Piazza   9/27/200,  3:00:39 PM
The OEX, too, has a potential H&S formation on its five-minute chart, but its H&S is a continuation-form one. I don't completely trust these, but they should be watched anyway. A move much above 533.25 would undo the possibility while a drop below the day's low would be needed to confirm the formation.

 
 
  Jeff Bailey   9/27/200,  2:58:33 PM
JDS Uniphase (JDSU) $3.29 -1.79% .... was some chatter this morning that company's quarter was "on track," and that company could provide some upside results.

JDSU reports quarterly earnings after the bell on October 27 with consensus looking for a loss of $0.01 per share.

 
 
  Linda Piazza   9/27/200,  2:57:20 PM
TRAN still may be following the form of a H&S on its five-minute chart, with that formation part of a second right shoulder for a larger H&S on its 60-minute chart.

 
 
  Mark Davis   9/27/200,  2:55:20 PM
CCI +230... it didn't take much to print a short-term overbought reading. TRIN 1.30... the only good thing I see is a possible double bottom @ 1104.25. I'll seriously consider going short again @ 1106 if the oscillators look ripe (IF we even get that high).

 
 
  Linda Piazza   9/27/200,  2:47:34 PM
The TRAN is above 3180 again but still below the appropriate right-shoulder level for a H&S on its five-minute chart.

I'll be away for 10-15 minutes.

 
 
  Mark Davis   9/27/200,  2:47:06 PM
If this thing rolls over again I'll... I'll...

 
 
  Jonathan Levinson   9/27/200,  2:46:40 PM
Above 34.53 QQQ, look for resistance at 34.58. Sure would be nice to get some range to allow me to stop counting pennies.

 
 
  Mark Davis   9/27/200,  2:45:42 PM
Exiting short early, +1.00

 
 
  Jeff Bailey   9/27/200,  2:42:45 PM
Day trade short alert .... for Foundry Networks (FDRY) $9.92 bid, stop $10.02, target $9.68.

 
 
  Jonathan Levinson   9/27/200,  2:37:32 PM
QQQ bounced from 34.48, matching but not exceeding the morning low. I use the word "bounce" loosely- it's going to take more than 3 or 4 cents to pull the Qubes back from the edge. The short cycle oscillators are rolling over in a new downphase, and given how the previous upphase was, it's looking ominous for bulls here. Look for support below 34.48 at 34.38, 34.25 and 34.10.

 
 
  Mark Davis   9/27/200,  2:37:10 PM
stepping outside for some fresh air... will keep the window open and volume up so I can hear a1erts.

 
 
  Linda Piazza   9/27/200,  2:36:55 PM
When I said that I thought the TRAN might steady at 3180 or "a little lower than that," I hadn't meant as low as 3177.50, but a steadying there and a rolling over below 3185-3187 still fits with the possible outcome I was outlining. Now I'm looking for a possible rollover from a lower level, perhaps at 3180 but perhaps a bit higher. This was all predicated on the possibility that this second right shoulder for the TRAN (60-minute chart) was itself taking the formation of a H&S. A move above the 3188.50 level would call into question the H&S formation on the five-minute chart.

 
 
  Mark Davis   9/27/200,  2:35:44 PM
SPX has just printed a buy signal on the 1-min chart.

 
 
  Mark Davis   9/27/200,  2:32:29 PM
Setting stops to break even...
Long @ 1104.23, stop 1104.23
Short @ 1106, stop 1106

 
 
  Mark Davis   9/27/200,  2:27:24 PM
Long @ 1104.23, stop 1103.23

 
 
  Linda Piazza   9/27/200,  2:26:53 PM
New low on the OEX, but it's attempting to bounce back to 532.

 
 
  Jeff Bailey   9/27/200,  2:26:21 PM
Sell Program Premium ... SPX 1,104.21 , QQQ $34.49

 
 
  Jonathan Levinson   9/27/200,  2:26:16 PM
Sessions lows across the board here- Dow futures are a few points away.

 
 
  Jonathan Levinson   9/27/200,  2:25:21 PM
QQQ is testing the previous low at 34.53 and breaking it as I type. Session lows are 3 cents away at 34.48.

 
 
  Linda Piazza   9/27/200,  2:25:03 PM
Here's what I see on the TRAN's five-minute chart: a possibility that the TRAN could steady somewhere near 3180 again, perhaps just under that, and climb again, perhaps just to 3185-3187, before rolling down again or shooting up past 3192. The second possibility is a steadying at 3180 and then a keeling over after only a minimal bounce or consolidation attempt. We'll soon see.

 
 
  Mark Davis   9/27/200,  2:25:00 PM
Short @ 1106, stop 1107
I can't get these things typed fast enough.

 
 
  Jonathan Levinson   9/27/200,  2:19:32 PM
HUI and XAU have entered negative territory, -.46% at 214.58 and -.21% at 96.1 respectively. Gold is up .50 at 410.30.

 
 
  Tab Gilles   9/27/200,  2:19:12 PM
Interesting chart for the XLB: Link

 
 
  Jonathan Levinson   9/27/200,  2:16:50 PM
Bulls need to hold 34.53. All the gains since noon have just been eliminated within 10 minutes.

 
 
  Mark Davis   9/27/200,  2:16:39 PM
Stopped out @ 1105.78, +1
This just isn't my day

 
 
  Jonathan Levinson   9/27/200,  2:15:06 PM
QQQ 2-day 100-tick update at this Link.

 
 
  Jonathan Levinson   9/27/200,  2:14:10 PM
Marc, the daily cycle downphase is still quite young, and the 30 min upphase attempt has been a no-show so far. These are both very bearish for anything longer than a short-term daytrading basis. While we're at it, even the short cycle upphase has been a no show, adding less than 25 cents off the lows for QQQ. The bias is bearish below 34.87-.90, and below 34.75 QQQ looks extremely weak.

 
 
  Linda Piazza   9/27/200,  2:13:35 PM
Mark, I don't have an official play going, so don't know what individual traders are deciding, but I imagine many OEX players who might have taken a breakdown short entry on the break below 533.595 this morning would still be in that play. The OEX hasn't yet violated the bottom of last week's 534-536.24 trading range, much less broken out through the top again. Some may have given up in exasperation, particularly as options prices have drifted lower as the OEX drifts aimlessly.

 
 
  Mark Davis   9/27/200,  2:12:45 PM
Another big red candle but this time they didn't buy it immediately. Looks like I bailed too early on the short. Two hours left for the bulls to press and they'd better get with it. If we get another CCI reading above +200 (or close) I'll consider going short again.

 
 
  Linda Piazza   9/27/200,  2:07:54 PM
Now bears want to see a new OEX low.

 
 
  Jeff Bailey   9/27/200,  2:07:51 PM
02:00 Internals at this Link

 
 
  Mark Davis   9/27/200,  2:02:10 PM
SOX just hit 380 again

 
 
  Linda Piazza   9/27/200,  2:00:13 PM
The Dow attempts to break out of its possible bull flag to the upside. Watch the last five-minute high at 10,043.

 
 
  Mark Davis   9/27/200,  1:59:48 PM
Exiting short early @ break even

 
 
  Jonathan Levinson   9/27/200,  1:58:21 PM
QQQ has managed to hold a 4 cent range for nearly one hour.

 
 
  Linda Piazza   9/27/200,  1:56:51 PM
The OEX's five-minute candles are miniscule again.

 
 
  Linda Piazza   9/27/200,  1:55:41 PM
The TRAN again drops below the 50% retracement of the steep decline off Friday's high, without yet having reached above the 61.8% retracement of that decline. The smallest channel has turned lower again on the TRAN's five-minute Keltner chart.

 
 
  Linda Piazza   9/27/200,  1:53:36 PM
The mid-channel level on the OEX's seven-minute chart is at 534.44. If the OEX breaks to the upside out of the possible bull flag, look for resistance there.

 
 
  Jonathan Levinson   9/27/200,  1:51:00 PM
Ten year yields ticked briefly over 4.0% but are falling back again, currently down 4.6 bps or 1.14% to 3.985%.

 
 
  Mark Davis   9/27/200,  1:48:26 PM
My long play is still active from 1104.88. I had set an alarm @ 1107 to trigger a short and assumed when it went off I had been stopped out of the long. The swing low for SPX was 1106.98, .10 pts above my stop. I entered the short ahead of my alarm. Sorry for the confusion.

Long @ 1104.88, lowering stop to 1105.88
Short @ 1107.76, stop 1108.86

 
 
  Linda Piazza   9/27/200,  1:35:52 PM
The OEX pullback could still be a bull-flag pullback before another assault on the 534 level, but five-minute closes beneath the Keltner line currently at 532.96 would make that less likely.

 
 
  Jonathan Levinson   9/27/200,  1:35:36 PM
A 30 min cycle oscillator upphase is trying to confirm for QQQ with the proxy channel still flat in this slightly-positive sideways drift. I'm not impressed with the setup from a bullish angle, given the ongoing synchronous 60 min and daily cycle downphases. Bulls need to see north of 34.75 for at least 10 minutes in order to generate more than just a potential throwover- cautious bulls will want to see 34.87-.90 broken first. Note that the short cycles are near the midpoint of their range and should be overbought by the time QQQ reaches 34.75, if it does so at all.

 
 
  Mark Davis   9/27/200,  1:34:23 PM
Hey we both have the same name... why not? LOL

 
 
  Mark Davis   9/27/200,  1:33:27 PM
Stopped out of long @ 1106.78, +2

 
 
  Mark Davis   9/27/200,  1:32:55 PM
There it goes... short @ 1107.76

 
 
  Linda Piazza   9/27/200,  1:32:52 PM
The TRAN is caught between 3180 support and 3200 resistance.

 
 
  Mark Davis   9/27/200,  1:30:55 PM
Sell signal developing... CCI is set up correctly but MACD needs to cross down to confirm and it has just crossed up (barely, and that could easily reverse)

 
 
  Mark Davis   9/27/200,  1:27:49 PM
B-bands converging again, this time in the 1107.50 area. I'm guessing further upside, based solely on the large "finger" formation printed @ 12:45PM

 
 
  Jonathan Levinson   9/27/200,  1:27:31 PM
Nymex crude is down to 49.20 currently, +.66% with 1 hour to go of the daytime session. Gold is down to 410.70, +.90 or .22%, while silver is holding at 6.55, +1.99%. HUI and XAU are both fractionally positive.

 
 
  Linda Piazza   9/27/200,  1:22:12 PM
The OEX's pullback beneath the mid-channel Keltner level on the five-minute chart may be taking the form of a bull flag. Five-minute closes beneath the 533 level will turn the smallest Keltner channel lower again.

 
 
  Mark Davis   9/27/200,  1:18:51 PM
Raising stop on long play to 1106.88, locking in +2

 
 
  Mark Davis   9/27/200,  1:16:59 PM
I'll be going short with an SPX trade @ 1107, irregardless of what my 1-min trading system tells me

 
 
  Jonathan Levinson   9/27/200,  1:15:02 PM
QQQ is respecting a pattern of higher lows here. A print below 34.57 is necessary to break it.

Bonds are coming back off their highs and just now testing 4.0% resistance.

 
 
  Mark Davis   9/27/200,  1:14:16 PM
Here comes another little push... C'mon Seabiscuit!

 
 
  Jeff Bailey   9/27/200,  1:10:56 PM
01:00 Internals at this Link

 
 
  Linda Piazza   9/27/200,  1:06:27 PM
The TRAN is now above a 50% retracement of the steep decline off Friday's high. I knew this climb didn't look like a bear flag. The index has not yet retraced more than 61.8% of the decline, but it if should, then standard technical analysis suggests that it may retrace all of it. I think 3200-3212 may prove difficult, however.

The TRAN has a H&S-ish formation with a descending trendline on its 60-minute chart. I think today's sharp bounce, coming as it did from the neckline of that formation, is an attempt to reject the formation. If the TRAN should shoot much above Friday's 3209.92 high, it will be rejecting that formation, but so far, the TRAN's pattern remains within the realm of a possible H&S formation.

 
 
  Jeff Bailey   9/27/200,  1:03:27 PM
01:00 Market Watch at this Link

 
 
  Jonathan Levinson   9/27/200,  12:57:10 PM
QQQ spiked above the previous high by 3 cents, setting the new high at 34.74, 1 cent below 34.75 confluence from Friday's lows. The short cycles have perked back up, and with QQQ pulling back to 34.68 currently, bulls and bears will be watching for the level from which the current wavelet cycle bottoms. A bounce from above 34.58 would suggest another bullish attempt on the day highs, while a failure below it will be another short cycle rollover. Above 34.75, 34.87 is the next strong resistance level. Link

 
 
  Linda Piazza   9/27/200,  12:53:24 PM
The OEX heads up toward the mid-channel level on the five-minute chart, with that at 534.10. I'm noticing that the OEX somehow adheres to the mid-channel level on the 7-minute chart better, with that one at 534.64.

 
 
  Mark Davis   9/27/200,  12:50:36 PM
That was one heck of a head fake... I'll consider it bullish until proven otherwise.

 
 
  Mark Davis   9/27/200,  12:41:22 PM
I almost took a short position again @ 1107... stepping outside for some fresh air.
If I come back and see SPX @ 1105 I'm going to be "ticked" off

 
 
  Linda Piazza   9/27/200,  12:40:51 PM
All that 15-minute resistance that had been holding the OEX back is now beneath the OEX, perhaps serving as support. The mid-channel level on the five-minute chart now descends to 533.98-534.08.

 
 
  Jeff Bailey   9/27/200,  12:39:05 PM
Perot Systems (PER) $15.10 +10.13% Link .... Upgraded by KeyBanc to "buy" from "hold" and $17 price target following PER's positive guidance.

PER sees Q3 EPS of $0.21 to $0.23 versus consensus of $0.18 and prior guidance of $0.17-$0.18. Guidance raised primarily due to increased technology spending from its clients, which is faborably impacting commercial accounts and consulting revenue. PER also said beneficial impact from a reduction in income tax expenses related to prior periods will have quarterly results improved more than previously expected.

 
 
  Mark Davis   9/27/200,  12:34:50 PM
B-bands rapidly converging just below SPX 1107... which way will it break? MACD has crossed back down but there was never a CCI reading above +200 (although it came VERY close... maybe close enough???) We'll find out soon.

 
 
  Mark Davis   9/27/200,  12:30:58 PM
Still waiting for that sell signal that never comes (intraday today). It was very close on that spike just above 1107. I hope I don't live to regret not taking it (a short @ 1107) but I would have been breaking my own trading rules. I've already done that once today and paid the price.

 
 
  Jeff Bailey   9/27/200,  12:28:58 PM
Lehman iShares 1-3 (AMEX:SHY) $82.05 +0.04% Link ....

 
 
  Jonathan Levinson   9/27/200,  12:28:05 PM
Stepping away for 15 minutes here.

 
 
  Jeff Bailey   9/27/200,  12:24:28 PM
Netease.com (NTES) $37.00 -3.06% ... testing its rising 21-day SMA Link with today's trade at $37 a 3-box reversal after test of bearish resistance trend. Link

Hans Seng ($HSI.X) 13,022 -0.34% Link easing back after recently exceeding its bullish vertical count of 13,300.

 
 
  Jonathan Levinson   9/27/200,  12:20:22 PM
Following Keene's comment, a failure to touch the previous double top high for QQQ would be very bearish on an intraday and short cycle basis as well.

 
 
  Mark Davis   9/27/200,  12:19:09 PM
We could start seeing some short covering here pretty soon if we continue much higher (big IF).

 
 
  Linda Piazza   9/27/200,  12:18:55 PM
There's the first fifteen-minute close above that converged Keltner resistance on the 15-minute chart. Now we should turn to the five-minute chart and note the mid-channel level since short-term oversold conditions suggested that the mid-channel level would eventually be retested. Resistance converges there at just over 534. I thought the mid-channel level would probably sink to at least that level before that 534-536 consolidation band could be tested. It's amazing how often Keltner lines converge with historical S/R. Mid-channel resistance is still sinking, but could steady as the OEX begins to climb. I'm not a countertrend-long person, but if you are and if you've decided to buy the OEX here, have some plan in place for how you'll handle that 534-536 resistance zone, as it could be tough.

 
 
  Jeff Bailey   9/27/200,  12:18:48 PM
Paychex (PAYX) $29.81 -0.86% ....

 
 
  Jeff Bailey   9/27/200,  12:17:12 PM
JDS Uniphase (JDSU) $3.30 -1.24% ....

 
 
  Jeff Bailey   9/27/200,  12:14:56 PM
Taser Intl. (TASR) $38.70 -1.3% .... no negative mention in this weekend's Barron's that I can find.

 
 
  Linda Piazza   9/27/200,  12:14:23 PM
I always look dumb when I refer to Dow theory. I do know that we have to talk about closes and not intraday divergences when we talk about official Dow theory, although I still think it's instructive to watch intraday divergences, even if not "official." However, reading one of Leigh's articles a month or two ago, I see that he noted that we're supposed to be talking about monthly closes. Not a great market-timing tool for daytraders or swing traders, then, is it? I'm joking around, but I do think we ought to watch both indices, and we should probably be paying more attention to the utilities, too.

 
 
  Jeff Bailey   9/27/200,  12:13:51 PM
Stillwater Mining (SWC) $14.20 +1.28% .... December Palladium (pa04z) 226.25 +1.11%

 
 
  Jonathan Levinson   9/27/200,  12:12:38 PM
Nymex crude is down to 49.25 here, up .375 or .77%.

 
 
  Mark Davis   9/27/200,  12:11:58 PM
That was the one Marc.

 
 
  Jonathan Levinson   9/27/200,  12:11:47 PM
The wavelet cycle upphase on the previous chart Link led QQQ right back through 34.58-.60 resistance. Bears will be hoping for a failure from a lower high (below 34.70), while a break above the high will have to deal with 34.75 and last week's key 34.87-.90 resistance level.

 
 
  Jeff Bailey   9/27/200,  12:11:40 PM
12:00 Internals at this Link

 
 
  Mark Davis   9/27/200,  12:10:54 PM
Approaching the SPX 1106 area again. IF we can take that level out a long play may get some traction but if we roll over again it won't look good for bullish plays.

 
 
  Jonathan Levinson   9/27/200,  12:09:59 PM
QQQ 100-tick 2-day chart update at this Link.

 
 
  Mark Davis   9/27/200,  12:07:55 PM
Linda I can't remember who the guest was but Bloomberg TV had someone on over the weekend who said whenever the Dow and TRAN were out of sync it usually meant distribution was taking place. I haven't done any back testing to check this... just reporting what he said.

 
 
  Linda Piazza   9/27/200,  12:04:55 PM
I agree, Marc, with regard to the Dow. The TRAN is once again amazing to watch, though. After reaching a new low today, it's ping-ponged higher, bouncing almost straight up to a 50% retracement of the decline off Friday's high. The Dow headed back below 10,000 might take some of the drive (pun intended) out of the transports, but I'm keeping a close watch on the TRAN, probably for the same reason you watch it, because it sometimes leads the Dow. These two need to get in synch.

 
 
  Mark Davis   9/27/200,  12:04:52 PM
Dow 10,000 and SPX 1105 are trying to hold on by their fingernails but I don't like the SOX below 380.

 
 
  Jonathan Levinson   9/27/200,  12:04:43 PM
YM is now trading both sides of 10000, with QQQ now testing 34.58-.60 resistance from below. The 30 min and 60 min cycle oscillators continue to point south, and the short cycle upphase proved to be merely corrective. Bears will want to see a retest of 34.48 support to seal the deal- more sideways chop could begin to look consolidative if the day lows don't get taken out within the next hour or so.

 
 
  Jeff Bailey   9/27/200,  12:02:24 PM
12:00 Market Watch at this Link

 
 
  Linda Piazza   9/27/200,  11:59:30 AM
TRAN trying to steady at a 38.2% retracement of this morning's climb, just below a 38.2% retracement off Friday's steep decline.

 
 
  Linda Piazza   9/27/200,  11:58:23 AM
Dow headed back for a retest of 10,000.

 
 
  Mark Davis   9/27/200,  11:51:03 AM
Lowering stop on long play from 1104.88 and break even to 1103.88 (just below LOD)
I just came within 5 cents of getting stopped out... a little too close to the action for my liking.

 
 
  Jonathan Levinson   9/27/200,  11:50:07 AM
QQQ is testing 34.58 support here. A wavelet downphase is just reaching the bottom of its range here, but the short cycle upphase has stopped. Next target is 34.52 to start the wavelet trending in oversold.

 
 
  Mark Davis   9/27/200,  11:45:40 AM
We rolled over right at the 10:38 swing high of 1106 and change, a predictable point for a pause. I was very tempted to enter a short at that level but didn't because the buy signal hadn't aborted yet (it has now) and the 1-min chart never came anywhere near printing a sell signal. On days like today you may not need a sell signal (just follow the trend) but I prefer to stick with a trading system that works for me. I was +20 last week and am -5 so far today with a no risk long play from 1104.88 so will probably wait for that sell signal that may never come.

 
 
  Jonathan Levinson   9/27/200,  11:44:23 AM
QQQ 2-day 100-tick update at this Link.

 
 
  Jeff Bailey   9/27/200,  11:40:59 AM
11:00 internals at this Link

 
 
  Linda Piazza   9/27/200,  11:38:18 AM
The SPX and OEX indices have misshapen reverse H&S-ish formations at the bottom of their declines, so misshapen that it's difficult to determine where their necklines should properly be placed. Still, I take these as signs that bulls are trying to marshal their forces. A drop to a new low would undo that possibility, showing us that bulls still don't have much force. On the OEX, a climb above 533 would probably confirm the formation, although such a confirmation would set an upside target only at the bottom of the 534-536-ish rectangular formation in which it had traded since Thursday afternoon. This is another reason to assess willingness to stay in a bearish position for that retest, though.

 
 
  Jonathan Levinson   9/27/200,  11:36:10 AM
QQQ double topped at 34.70-.71 there and is currently back down to 34.62. A print below 34.58 should stall the short cycle upphase, while a move below 34.52 for 3-5 minutes should kick off a new downphase.

 
 
  Linda Piazza   9/27/200,  11:33:21 AM
The last fifteen-minute period closed with the OEX at the Keltner line that's currently at 532.61 (then at 532.62), not above that line. The 15-minute Keltner resistance still looks strong and is still holding. The TRAN's action bears watching, though, as that wasn't any bear flag in which it climbed straight up toward a 50% retracement of the steep decline off Friday's high.

 
 
  Linda Piazza   9/27/200,  11:30:08 AM
The TRAN zoomed all the way past the 38.2% retracement of the steep decline off Friday's high and kept going, climbing straight up toward a test of the 50% retracement. That test comes at just under 3188.50, with the TRAN at 3185.67 and dropping as I type.

 
 
  Linda Piazza   9/27/200,  11:28:04 AM
It's possible that in a minute or two, we may see our first OEX fifteen-minute close above the Keltner line currently at 532.62. Bears then hope to see fifteen-minute closes below 532.91 resistance, but the OEX might be breaking through that 15-minute resistance, as I mentioned that I expected it to do at some point. Let's see.

 
 
  Mark Davis   9/27/200,  11:26:46 AM
Raising stop on long play to 1104.88 and break even.

 
 
  Jonathan Levinson   9/27/200,  11:25:18 AM
QQQ now 1 cent below the session high.

 
 
  Jonathan Levinson   9/27/200,  11:22:17 AM
Nymex crude +.575 at 49.45 here.

 
 
  Jonathan Levinson   9/27/200,  11:20:36 AM
Interesting to see the S&P futures leading to the downside again. QQQ is trading 34.65, with its session high currently at 34.71. The short cycle upphase has made it roughly to the midpoint of its range, and bulls will need to get above that 34.75 level before it rolls over to avoid what would look like a very likely retest of the session lows.

 
 
  Linda Piazza   9/27/200,  11:18:25 AM
TRAN really zooming higher here, but now touching a 38.2% retracement of its steep decline from Friday's high. This could be a point at which it pauses or pulls back.

 
 
  Mark Davis   9/27/200,  11:17:01 AM
Setting stop on long play from earlier...
Long @ 1104.88, stop 1103.88

 
 
  Linda Piazza   9/27/200,  11:15:05 AM
The OEX continues to test 15-minute Keltner resistance, from 532.68-532.95. That resistance currently looks strong enough to hold back the OEX. At some point, I expect the OEX to break through and attempt to test the mid-channel level, at least on the five-minute chart. That's at 534.55 on the five-minute chart, but still descending quickly. If such a test were to occur soon, that would mean that such a test would be a retest of the broken support from the 534-536 rectangular band in which the OEX traded from Thursday's afternoon until this morning. If the OEX doesn't break through soon, though, the mid-channel level will descend further before it can be retested. So, I think bears should be assessing their willingness to stay in for a retest of that rectangular consolidation zone to see if it now holds as resistance.

 
 
  Jonathan Levinson   9/27/200,  11:09:17 AM
This sideways drift in QQQ has been sufficient to stall the 30 min cycle channel downphase, with support currently at 34.40 and resistance 34.79, just above Friday's confluence resistance at 34.75.

 
 
  Jonathan Levinson   9/27/200,  11:08:26 AM
Session high for euro futures, +.37% to 1.2302.

 
 
  Mark Davis   9/27/200,  11:07:38 AM
There has been bullish MACD divergence since 13 minutes after the opening bell. It should start to kick in at some point but is showing no sign of doing so yet... well, maybe a smidge. Since LOD @ 1104.30 we have had two higher highs and two higher lows and are currently putting in a third higher high.

 
 
  Jeff Bailey   9/27/200,  11:07:05 AM
11:02 Market Watch at this Link

 
 
  Jonathan Levinson   9/27/200,  11:03:39 AM
Gold printed a session high of 412 and is currently holding at 411.50. Above 412, next resistance is the 414-5 level. Bulls want to see 408 support, and ideally 410 hold on any pullback to continue the pattern of higher lows. Silver is up a whopping 2.21% to 6.565, while HUI is up .61% to 216.99 and XAU +.75% to 97.02.

 
 
  Linda Piazza   9/27/200,  11:02:17 AM
The SOX is trying to steady at the converged 10- and 20-dma's, currently at 380.90 and 380.21, with the SOX at 380.46 as I type. The SOX pierced both averages this morning, but has been attempting a bounce. That bounce has taken the SOX into the morning's gap as it tries to fill it. It has already filled more than 61.8% of the gap, showing some strength, and currently pulls back into a possible bull flag before attempting the top-of-the-gap level again. Watch for a move above that gap and the downtrend line from about 1:30 Friday afternoon or for a breakdown out of the flag for signs of short-term strength or weakness, with such strength or weakness perhaps impacting other markets, too.

 
 
  Mark Davis   9/27/200,  10:59:11 AM
Just in case some of you think I've completely lost my marbles, I'm planning on entering a concurrent short play if we EVER get a sell signal (other than the one I missed on Friday). At this point SPX looks vulnerable to 1050 but I don't try to trade +/-60 point moves. I just try to chip away at the smaller ones as they present themselves.

 
 
  Linda Piazza   9/27/200,  10:55:13 AM
Keltner resistance continues to firm up above the OEX on the 15-minute chart, from 532.74-533.06. So far, the resistance looks strong enough to repel the OEX, but bears would like to see continued 15-minute closes beneath the Keltner line currently at 532.74.

 
 
  Jonathan Levinson   9/27/200,  10:51:44 AM
A short cycle upphase is in progress on QQQ, but traction is weak so far. The 30 and 60 min proxy channels are sloping downward here, and as I mentioned earlier, until those channels turn decisive up, any short cycle bounce should be merely corrective/sideways/weak. That scenario is playing out so far this morning.

 
 
  Jonathan Levinson   9/27/200,  10:50:23 AM
Nymex crude has pulled back to its current 49.375, up .50 or 1.02%- back to earlier morning levels.

 
 
  Jonathan Levinson   9/27/200,  10:49:43 AM
QQQ chart update at this Link.

 
 
  Linda Piazza   9/27/200,  10:47:05 AM
The BIX attempted a climb above its 50-dma today, but is back below it again and is back slightly in the red again. The BIX looks as if it might be attempting to rise in a bear flag to retrace part of the recent steep losses.

 
 
  Mark Davis   9/27/200,  10:46:26 AM
The persistent buy signal from 9:43AM just aborted, although I wouldn't be surprised to see it turn back up again here at support.

 
 
  Linda Piazza   9/27/200,  10:44:45 AM
The OEX tests the day's low, but the TRAN is climbing in a flag-like formation from its day's low, up toward Friday's low.

 
 
  Linda Piazza   9/27/200,  10:42:32 AM
The OEX attempted an upside break out of the symmetrical triangle, but couldn't maintain that upside break. It is maintaining five-minute closes beneath the Keltner line currently at 532.59, the first resistance on the five-minute chart.

 
 
  Linda Piazza   9/27/200,  10:36:42 AM
The OEX coils up into a symmetrical triangle on the five-minute chart.

 
 
  Jonathan Levinson   9/27/200,  10:34:28 AM
Session high for bonds, with ZN futures printing 113.55 and TNX -4.4 bps to 3.987%.

 
 
  Linda Piazza   9/27/200,  10:28:41 AM
The TRAN did drop below Friday's low. It's at 3168.28 as I type, above the 3153-ish level that marks the 38.2% retracement of its rally off the August low.

 
 
  Jonathan Levinson   9/27/200,  10:28:33 AM
QQQ has just broken prior resistance, now up to 34.64 with the first short cycle buy signals printing now. The wavelet oscillator never rolled over, instead trending in overbought. Above the premarket range to 34.67, there's still resistance at 34.75, being Friday's lows.

 
 
  Linda Piazza   9/27/200,  10:26:37 AM
OEX bears would like to see continued five-minute closes beneath the Keltner line currently at 532.71, a line now being tested, or below the line currently at 532.95.

 
 
  Jeff Bailey   9/27/200,  10:21:26 AM
VIX.X 14.88 +4.2% .... daily pivot levels as follows ... 13.73, 14.00, Piv = 14.34 , 14.61, 14.95.

 
 
  Jonathan Levinson   9/27/200,  10:21:11 AM
QQQ has broken the previous high by all of a penny, still hanging onto that 34.58 level from earlier. A wavelet upphase is close to topping out here, but there's a pattern of higher wavelet lows developing which suggests the onset of a new short cycle upphase. Bears need to see the previous low at 34.48 broken on the imminent wavelet downphase to start the short cycles trending in oversold.

 
 
  Jeff Bailey   9/27/200,  10:18:33 AM
Current OPEN MM Profiles at this Link

 
 
  Linda Piazza   9/27/200,  10:18:21 AM
The OEX's Keltner channels show resistance trying to firm overhead, up to 533.56 and then again at 534.50. We may be about to see if it's going to hold.

 
 
  Jeff Bailey   9/27/200,  10:13:16 AM
10:00 Internals at this Link

Friday's internals at this Link

 
 
  Linda Piazza   9/27/200,  10:12:59 AM
The 61.8% retracement of the OEX's rally off the August low is at just over 530, so OEX bears should have a plan in mind for how they'll handle a test of that level, coinciding with historical S/R, if it is tested.

 
 
  Mark Davis   9/27/200,  10:12:52 AM
Readers keep in mind I am only posting a portion of what I'm doing in my own account (the SPX part). The only person posting official trades is Jim.

 
 
  Mark Davis   9/27/200,  10:10:38 AM
Long again @ 1104.88

 
 
  Mark Davis   9/27/200,  10:09:55 AM
Stopped out @ 1104.93, -2 (watch it reverse now... sigh)

 
 
  Mark Davis   9/27/200,  10:09:14 AM
The buy signal still has not aborted, although it is close. I need to print something on the inside of my eyelids so I don't forget... "The SECOND CCI print over/under 200 is usually the real reversal signal."

 
 
  Linda Piazza   9/27/200,  10:08:54 AM
Dow at just above 10,000. Bears, beware. If there is ever a bounce signal, this could be one.

 
 
  Linda Piazza   9/27/200,  10:07:30 AM
Hey, Mark, I was in your camp, thinking that we'd likely get a bounce. At least that's what I would have said Friday evening through yesterday evening. That's what I was hoping, too, for the sake of those wanting new bearish entries. I thought a rollover entry safer than a breakdown one.

 
 
  Linda Piazza   9/27/200,  10:05:23 AM
TRIN certainly isn't favoring the bearish camp just yet. Advdec is.

 
 
  Mark Davis   9/27/200,  10:04:57 AM
Stop scaring me Linda. Halloween is still a month away.

 
 
  Linda Piazza   9/27/200,  10:03:45 AM
Crude at $49.58, up 0.70.

 
 
  Jeff Bailey   9/27/200,  10:02:31 AM
10:00 Market Watch at this Link

 
 
  Jonathan Levinson   9/27/200,  10:01:03 AM
New home sales 1.184M, est.1.155M.

 
 
  Linda Piazza   9/27/200,  10:00:06 AM
Remember Friday morning when I mentioned that I was using the time while markets consolidated trying out new chart settings? One was suggested by another writer a number of months ago, using Fib numbers for time intervals. I studied the NDX's 100/130-ema's on a 382-minute chart and found what I thought was a strong correlation. This morning's NDX move was a gap below those averages, so I think the correlation still holds: Link This isn't a proven correlation and I'm not a frequent follower of the NDX, but I post it for those of you who are and who might find it one more tool to check out.

 
 
  Jeff Bailey   9/27/200,  9:59:55 AM
Wynn Resorts (WYNN) $49.62 +3.82% Link ... Deutsche Securities raises price target to $65 from $46. Firm's recent visits to Las Vegas and Macau positive with escalating land values on the Las Vegas strip and soon to be announced Phase II project in Las Vegas providing momentum. Firm sees incremental value coming from developing opportunities in Macau. Deutsche maintained it "buy" rating and said stock could hit $75 by 2007.

 
 
  Mark Davis   9/27/200,  9:56:42 AM
SPX has printed a buy signal @ 1106.80 that has not aborted yet. MACD lines look like a single line. Until MACD crosses back down (and stays down) the buy signal is alive.

 
 
  Jonathan Levinson   9/27/200,  9:56:36 AM
QQQ 2-day 100-tick chart update at this Link.

 
 
  Jonathan Levinson   9/27/200,  9:53:34 AM
9 minutes until the housing data. QQQ hit a low of 34.48, on the 161.8% fib line from Friday's low. The last plunge to the lows kicked off after a series of failed attempts to regain 34.58, which now becomes lower resistance.

Meanwhile, gold continues to chip away at last week's high, with today's high at 411.80.

 
 
  Linda Piazza   9/27/200,  9:53:32 AM
Here's a look at measuring characteristics related to the possible "b" distribution formation on the OEX's 60-minute chart: Link

 
 
  Mark Davis   9/27/200,  9:51:46 AM
I took that long play right after the bell based on a CCI reading of -540 and TRIN dropping into neutral territory, currently printing .87. I can't ever remember losing money betting against a CCI reading of -500 (or +500)... I hope today isn't the first time (grin). I'm starting the week -3 points in the hole thanks to holding a long position over the weekend.

 
 
  Linda Piazza   9/27/200,  9:47:55 AM
The TRAN approaches Friday's late afternoon low, with that low at 3172.37 and with the TRAN currently at 3174.02.

 
 
  Linda Piazza   9/27/200,  9:42:02 AM
Time for the first retracement of the day. OEX bears want to see the OEX turned back at the bottom of the 534-536 (536.24, actually) consolidation band from Thursday and Friday.

 
 
  Linda Piazza   9/27/200,  9:40:58 AM
My expectation last night, especially as our futures were holding up fairly well as the Nikkei declined again for the seventh straight session, was that we'd see consolidation or maybe even the beginning of that bounce I've been hoping to see on the OEX. Although I don't tend to trade countertrend bounces, my outlook for what would happen on the OEX probably fit fairly well with Mark's for the SPX. That, coupled with the fact that I don't trust first-five-minute moves and the Dow's close approach to 10,000, doesn't leave me with a comfortable feeling about this breakdown entry, but there were solid reasons to consider it and that's why I've been mentioning it. I'd sure be following the OEX down with my stops and set them at breakeven as soon as possible, though.

 
 
  Jonathan Levinson   9/27/200,  9:38:50 AM
QQQ is down to fib support at 34.53. The short cycle is oversold but not yet maxxed out- while a short cycle bounce can start at anytime, it can get more oversold than the current levels. Given the synchronous 30 min, 60 min and daily cycle downphases, I'm guessing that any bounce is going to be very weak. Bulls wuill need to see QQQ north of 34.87 to suggest that the 30 minute cycle has turned up on more than a merely corrective basis.

 
 
  Mark Davis   9/27/200,  9:37:32 AM
Going long here @ 1106.93, stop 1104.93

 
 
  Linda Piazza   9/27/200,  9:33:04 AM
The OEX opens and drops below the confirmation level for a breakdown entry. I don't trust these early-morning moves, so guard your position carefully, particularly with the Dow approaching 10,000. Depending on account parameters, I would set a stop just over the top of Friday's consolidation zone if your account or your nerves can take that heat.

 
 
  Jonathan Levinson   9/27/200,  9:32:38 AM
Session highs for gold at 411.40 and ten year bonds, TNX -2.1 bps.

 
 
  Jonathan Levinson   9/27/200,  9:31:07 AM
QQQ is breaking below 34.60 here. We recall the 34.45 confluence zone from weeks past. There's fibonacci support first at 34.53. The 30 and 60 min cycles continue their synchronous downphases. Given that the daily cycle is pointed south as well, this is prime time for the bears.

 
 
  Mark Davis   9/27/200,  9:30:11 AM
Here's something I wrote up over the weekend on SPX. It looks pretty stupid at this point and I considered not posting it but what the heck... it was what I came up with after taking a close look at the charts. Maybe there is something of value in there somewhere.

By the time I post this on the Market Monitor Monday morning we may already know if my weekend analysis of SPX is correct or just a lot of wishful thinking (I’m holding a long position over the weekend that was already -1 points underwater at EOD Friday). If the futures are up strongly Monday morning then I may have made the right decision to hold over the weekend. If they are down strongly then I blew it. If they are flat we’ll have to wait and see what develops.

I scrutinized the SPX charts more closely than a film of Sasquatch over the weekend and here are a few observations... call them “possible future scenarios” based on past performance. The charts suggest the most likely scenario (by a hair) is we rally back up to about 1130 before resuming a strong downtrend that could take SPX as low as 1050 before the Presidential election.

The first chart is a daily SPX chart drawn last Wednesday 09-22-04 that revisits the last few "b" distribution patterns and how SPX has reacted after bouncing off the bottom of the bulb. Link
As you can see, each "b" distribution pattern has resulted in a strong bounce off the bottom of the bulb, followed by a shallow retracement (about 38.2%), then another small rally approximately equal to the number of points in the retracement before the downtrend resumes. Since Thursday’s HOD @ 1131.50 we have retraced 21.39 points to 1110.11... a 30.21% retracement, very similar to the last two retracements before reversing back up. The question is will SPX behave the same way as the last two times and now rally about +21.39 points (to 1130.50 on the nose) before resuming the downtrend, or will it just continue to tank on Monday, or will it reverse upward and not stop @ 1131.50 but continue on to the upside target of the daily inverse H&S pattern all the way to SPX 1160? That’s a big question but it should be answered definitively by the early part of next week.

The second chart, also drawn on Wednesday, is another look at the "b" distribution patterns, but from a Fibonacci perspective. Again, it suggests the possibility of a small rally to about 1130 before resuming the downtrend, assuming the current chart pattern behaves the same as the last two similar configurations. Link

The third chart drills down to the 5-min level and shows a series of higher highs and higher lows, suggesting the possibility that a small rally may have already begun, starting Friday morning. Link

Now we go to Candlestick Analysis. Friday, SPX printed a "bullish inverted hammer/gravestone doji" on the daily chart. This is a bullish reversal pattern with low to moderate reliability. It occurs in a downtrend and here's what it looks like... Link I went back and checked the last 11 times SPX printed similar looking candle patterns and was surprised with the results. This indicator is supposed to be of “low to moderate reliability” but 9 out of the 11 previous patterns showed SPX up the next day and only two were down. The average gain on the 9 up days was just over 10 points while the average loss on the 2 down days was -4 points.

The last chart is another daily chart of SPX showing the current and previous Inverse H&S patterns... Link As you can see we are at a critical juncture. A big red candle on Monday or Tuesday, decisively violating the neckline of the inverse H&S pattern, would pretty much confirm further downside and put me into “sell any rally” mode, while a nice up day Monday or Tuesday would put me into at least a very short-term bullish mode.

All of this needs to be taken into context with seasonal (negative) factors and also the fact that this is a Presidential election year (positive). Add to that the fact that oil is all anybody is talking about lately. A Bloomberg piece on Friday afternoon stated that a record (59) analysts expected oil to top $50/bbl next (this) week. Are 59 analysts enough to make a “consensus” and tip the boat over? The puzzling rise in the $TRAN despite rising oil prices suggests that is a possibility. Another factor to consider is that earnings warnings are almost over and it’s time for real earnings to start trickling in. This is the last week of warnings before real earnings and it’s possible that investors will ignore bad news (especially if they blame hurricanes Charley, Frances, Ivan and Jeanne). The SOX has rallied from 350 to over 400, dropped back to 380, and it’s unclear whether support will hold this week, but one thing is for sure... people have been nibbling already. NSM and other select Semis are up almost +25% in the last couple of weeks and the Russell is also holding tough (so far). Will the sluggard Dow be pulled up by continued accumulation of beaten down tech stocks or will the techs be pulled down by the Dow? It’s definitely a bifurcated market with many swirling influences. Terror risk is bound to increase as the elections draw near in Iraq and the US but some of that may have already been factored into the market. A major terror attack on US soil could really put fear into the market but the lack of a major attack could also bring sideline money back into the market. So many factors, so little time... that’s why I like to keep my focus short-term and trade with the trend. Despite all the outside noise I believe the charts are the thing to keep your eye on. They record every trade and have no agenda. One last thought... CBOT data has shown commercials getting more bearish while retail is getting more bullish. This is normally a warning to get short but if I remember correctly the commercials were on the wrong side of the bet in March 2003 while the little guy made the correct call on market direction. I’m hearing almost nothing but negativity lately and the market loves to do just the opposite of what the crowd expects.

 
 
  Linda Piazza   9/27/200,  9:28:07 AM
Some companies hope to squeeze under the radar by warning or announcing deleterious news late Friday. ClearOne Communications (CLRO) was one, saying that it's making progress toward being able to file reaudited financial statements, but it won't be able to do so by the end of September, as it had earlier estimated it might do. Digital electronic products designer and seller ESS Technology (ESST) lowered its Q3 outlook.

 
 
  Linda Piazza   9/27/200,  9:26:48 AM
Although I, too, have a bearish intermediate outlook, I sure wish the OEX would bounce and relieve some short-term oversold pressure and afford want-to-be bears a new entry. The OEX ended Friday at the bottom of the rectangular 534-536 consolidation band, so there's not much wiggle room to the downside before breaking to the downside out of that band. The 50% retracement of the rally off the August low at 533.595, and that 50% retracement sometimes provides a power bounce or consolidation point. Those seeking breakdown entries might want to wait until a move through that 50% retracement level.

 
 
  Linda Piazza   9/27/200,  9:22:06 AM
My sympathy goes out to those among our subscribers in areas impacted by Hurricane Jeanne, as well as by the other hurricanes this season. I just talked to my brother, who is again without power at his home, but is otherwise okay other than the need to clean up debris. I hope our subscribers have suffered only minimal effects.

 
 
  Jonathan Levinson   9/27/200,  9:20:33 AM
Nymex crude +.825 or 1.69% to 49.70.

 
 
  Jonathan Levinson   9/27/200,  8:34:11 AM
Session high for Nymex crude, +.50 at 49.375, +1.02%.

 
 
  Jonathan Levinson   9/27/200,  8:09:28 AM
Using Friday's high and low as a reference, QQQ has next fibonacci support at 34.63, the 127.2% retracement off the low, below which is 34.58. I'd been using 34.65 as next downside confluence support, which is close enough. The 30 and 60 min cycles continue in their downphases, with 30 min channel support also at 34.63 QQQ.

 
 
  Jonathan Levinson   9/27/200,  8:04:34 AM
We await the 10AM release of New Home Sales for August, est. 1.150M.

 
 
  Jonathan Levinson   9/27/200,  8:02:49 AM
Equities are lower, with ES trading 1109, NQ 1398.5, YM 10027 and QQQ -.15 to 34.66. Gold is up .20 to 410, silver +.003 to 6.426, ten year notes +.031 to a session high of 113.2344 and Nymex crude +.425 to 49.30 per barrel.

 
 
  Linda Piazza   9/27/200,  6:55:04 AM
Good morning. With a few exceptions, bourses across the globe have been hit by higher oil prices and have been in retreat during the overnight session. Our futures held up fairly well until the European open, when they began dropping.

More detail follows in the next paragraphs. With stocks hit by higher crude prices and worries over the October 1 release of the quarterly Tankan survey, the Nikkei opened below 10,900, attempted to regain that level and then dived to its low of the day. In addition, the Cabinet Office and Ministry of Finance released a survey that revealed that business confidence may have fallen, including confidence among large manufacturers. Auto manufacturers and airlines headed lower. The Nikkei spent the next few hours steadying just above that low of the day and then climbed into the close. It closed lower by 35.84 points or 0.33%, at 10,859.32. The Nikkei has fallen for seven straight sessions and hit its lowest close since August 18.

Other Asian markets turned in mixed performances, with more closing in the red than in the green. The Taiwan Weighted lost 0.73%. South Korea's Kospi was closed today and will be closed through Wednesday on a holiday. Singapore's Straits Times closed higher by 0.50%, but Hong Kong's Hang Seng dropped 0.34%. China's Shanghai Composite dropped 0.57%.

Currently, European bourses also turned in mixed performances, but the ones commonly followed in the early-morning report all trade in negative territory. Germany's Ifo indicator for business climate declined but by a less-than-expected amount, but oil prices pressure equities. Chip-makers declined. Construction stocks were helped throughout Europe by Mexico Cemex's decision to buy Britain's RMC Group. Much attention was paid on CNBC Europe through the night to German retailer Karstadt Quelle's steep decline after a board chairman noted the company's restructuring plans, saying that the company was in a struggle to survive.

As of 6:52 EST, the FTSE 100 trades lower by 34.70 points or 0.76%, at 4,543.40. The CAC 40 trades lower by 22.88 points or 0.62%, at 3,650.63. The DAX trades lower by 41.65 points or 1.07%, at 3,868.65.

 
 
  Linda Piazza   9/26/200,  11:40:11 PM
For early next week, I'm hoping for an OEX bounce up toward 538-540 and a consolidation prior to a rollover from there. That would be an ideal new bearish entry, if offered. A breakdown entry would be offered on a rollover through the 60-minute consolidation zone's lower boundary at just above 534, but since the 50% retracement of the rally off the August low lies at 533.595, I think it would be best to wait for a confirming rollover through that level for a breakdown entry. Let's see what tomorrow brings. We'll follow it blow-by-blow. Although I'm hoping for a bounce, I will consider it a countertrend bounce if it occurs, so I do not suggest long positions for any but the most adept scalpers, lucrative as they might turn out to be.

Our patience Friday and a before-the-open plan that incorporated a probable consolidate-the-losses day with the hope of a bounce kept us from agonizing over each zig and zag of the markets. Now we hope that Monday and perhaps Tuesday set us up for the perfect directional play.

 
 
  OI Technical Staff   9/26/200,  11:39:59 PM
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