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  Jeff Bailey   10/8/200,  6:54:05 PM
Last 3 week's pivot matrix at this Link

  Jeff Bailey   10/8/200,  6:42:10 PM
Pivot Matrix for next week at this Link

  Jeff Bailey   10/8/200,  6:00:33 PM
Closing Internals at this Link

  Mark Davis   10/8/200,  4:19:12 PM
Short @ 1127.50, stop 1127.50 and break even, hold over the weekend

I never bit on the long play, and I may live to regret it, but with +5 points in the bank going into the weekend I doubt if I'll do any worse than break even. They sold off into the close and SPX printed a sell signal right before the close, otherwise I would have taken a long position.

I don't know if any of you remember but I stated here several times over the last month or so that I thought the most likely scenario was for a rally just to the point where the "all clear" signal was sounded for bulls, then the rug would be pulled. The rug is not completely pulled yet but they sure gave it a good yank over the last two days. I really don't see much support below until SPX 1115 so I'm taking a gamble here, or maybe more properly a calculated risk.

Have a great weekend and I'll see you all at the bell on Monday.

  Jeff Bailey   10/8/200,  4:18:12 PM
Current OPEN MM Profiles at this Link

Currently have an open order to sell the 5 SHY-XD at $0.60 per contract.

This week's CLOSED trades at this Link

  Jonathan Levinson   10/8/200,  4:01:40 PM
Attn our Karnspicuous reader and other goldbugs wondering about the upside spike this AM: The light volume reversal doji I noted this AM could result from a fat fingered trade or from outright manipulation or stoprunning, but from a technical standpoint it makes no difference. The almost instant rejection of the price at those highs is a bearish indicator- were it not, we would have seen a short covering moonshot to the upside caused by the upward probe. This is the obverse of those (in my opinion criminal) downside probes in the 374 area earlier this year, also on light volume. The resulting dojis saw moves higher following the rejection at the lows.

  Jeff Bailey   10/8/200,  4:01:28 PM
Sell Program Premium ... DIA $100.72 , SPY $112.55, QQQ $35.60.

  Jeff Bailey   10/8/200,  3:57:55 PM
Bearish day trade close out alert for BIIB $58.90 here.

Darned ridiculous .... "should have" faded back near $58, not hang out at $59.

  Mark Davis   10/8/200,  3:57:33 PM
Looks like I'll be taking the closing print for the long position

  Linda Piazza   10/8/200,  3:56:15 PM
Well, there was the slow grind upward finally completing on the OEX, but completing too late for us to see if it would have turned down toward 537 again.

  Mark Davis   10/8/200,  3:54:34 PM
Stopped out of short play @ 1122.50, +5... if you stayed with the original plan

  Jonathan Levinson   10/8/200,  3:51:50 PM
The short cycles are trying to put together another bounce, but 30 min channel resistance continues to point steeply lower, with the top of the channel currently 35.79, at former support.

  Mark Davis   10/8/200,  3:50:00 PM
Back... decision time
Short @ 1127.50, stop 1122.50

Make your own decision on this one (make sure you can sleep over the weekend) but here's what I'm going to do...
Short @ 1127.50, no stop, hold over the weekend
Long @ ????, no stop, hold over the weekend
I'll be taking a long position sometime before the close.

  Linda Piazza   10/8/200,  3:48:07 PM
Seven-minute Keltner resistance sinks even closer to the current OEX position with the OEX finally rising to test that resistance as I type. That resistance stretches up to 538.62 and then appears again at 539.45 and then at 540.59. The first resistance appears strong enough to hold, but I discount the worth of technical analysis in the last few minutes of trading.

  Jim Brown   10/8/200,  3:41:30 PM
FLIR getting whacked today for a -$4 loss on no news. Second day in a row for declines. Looks like October reshuffling in progress.

  Linda Piazza   10/8/200,  3:37:35 PM
Do you know yet whether you're going to hold over the weekend if you're in a bearish (or bullish) position? While we can't always know because last-minute action can change the view, having built some kind of if/then scenario allows you to plan the optimum time for exiting a position or hedging it, if you intend to take those steps. You've heard me mention enough times already that further bearish gains might be limited this afternoon, so you've had time to think about what you want to do about this afternoon.

  Linda Piazza   10/8/200,  3:34:36 PM
The TRAN is trying to manage a double-bottom formation just below 3330.

  Jeff Bailey   10/8/200,  3:32:48 PM
Sell Program Premium ... SPX 1,120.35 , QQQ $35.52.

  Linda Piazza   10/8/200,  3:31:47 PM
The slow grind (see my 15:17 post) hasn't been an upward one but a sideways one on the OEX. Meanwhile 7-minute Keltner resistance firms and turns lower toward the OEX's current position. Keltner resistance is at 538.25 and then again just under 539. I still wouldn't be surprised to see the OEX pop up once to test that 539-ish resistance before turning down again, but so far, the OEX can't produce closes above the nearest Keltner resistance, the one at 538.25.

  James Brown   10/8/200,  3:31:31 PM
While biotech giant AMGN is cracking support at $56.00 and its simple 100-dma.

  James Brown   10/8/200,  3:31:05 PM
Meanwhile Genentech (DNA), which has been down after its recent earnings report, just produced a failed rally(oversold bounce) under the $50.00 mark today.

  James Brown   10/8/200,  3:30:06 PM
The BTK biotech index is cracking technical support at its simple 40 and 200-dma's.

  James Brown   10/8/200,  3:29:24 PM
Some of the overbought sectors like Retail (RLX), Healthcare (HMO) and Defense (DFI) are certainly seeing some profit taking today.

  Jim Brown   10/8/200,  3:27:49 PM
I hate to hear that about Rukeyser because the show is the only real piece of quality content on CNBC after market hours. I have feared it for months when he did not bounce back af his surgery.

  James Brown   10/8/200,  3:25:36 PM
The 71-year old Louis Rukeyser announced today that he will not be returning to his show on CNBC. He stepped out a few months ago due to illness and back surgery. CNBC anchor Consuelo Mack will be filling in throughout the end of this year. (source: CBSMW)

  Jonathan Levinson   10/8/200,  3:22:45 PM
Session low for ER futures here- very little strength. The TRINQ is up to 2.39, showing an escalation in selling pressure, but volume has slacked off here at the lows.

  Linda Piazza   10/8/200,  3:17:59 PM
The TRAN is moving toward the day's low again.

  Linda Piazza   10/8/200,  3:17:24 PM
I wouldn't be surprised to see a slow grinding up toward next OEX resistance, perhaps near 539.25 or so, into the next few minutes, and then a downturn and decline toward 536.50-537, but that's just one end-of-day possible scenario. Beginning during the market-on-close period, I think anything goes, and I will tend to discount what I see. My personal preference in situations like these is to automatically close positions as 537-538 was hit and just begin the celebration early, knowing that I'm risking a gap down Monday morning, but willing to risk that. I'd want to start fresh on Monday. Others might employ different tactics. Whatever you do, make sure you're comfortable with the risk, including the risk that the OEX could continue lower Monday. If you're in October options, remember that risk includes several days of premium decay, because that time decay occurs over the weekend, too.

  Jonathan Levinson   10/8/200,  3:12:46 PM
Bonds close deep in the green, with TNX -11.1 bps or 2.62% to 4.133%.

  Linda Piazza   10/8/200,  3:08:24 PM
Keltner resistance on the 7-minute OEX chart is at 538.54, but is strongest at 539.13-539.22.

  Jeff Bailey   10/8/200,  3:06:43 PM
03:00 Market Watch at this Link

  Mark Davis   10/8/200,  2:59:48 PM
I have to leave for an errand... back in 30 min

  Jonathan Levinson   10/8/200,  2:59:17 PM
QQQ has already exceeded its average daily volume of 90M and is well above yesterday's 82.47M shares for the day, having traded 95.8M so far.

  Linda Piazza   10/8/200,  2:59:13 PM
It's possible that the OEX may dip all the way to 537.11 if not to 536.50 now, but anywhere through here is probably still a good place to take at least partial profits. If the OEX should dive much below 536.50, however, it sets up a target near the 50% retracement of the rally off the August low, with that level at about 533.60.

  Jeff Bailey   10/8/200,  2:58:29 PM
Bearish day trade lower stop alert .... lower stop on Biogen/Idec (BIIB) $58.78 -2.27% .... to $59.06.

  Jonathan Levinson   10/8/200,  2:58:11 PM
The CRB set a new 24 year high today, breaking 287. Gold is holding its gains, while HUI is down slightly to a 3.05% gain at 238.56.

  Linda Piazza   10/8/200,  2:54:26 PM
Here (OEX 537.72 as I type) would be a good place to begin collecting at least partial profits if in a bearish OEX position or else taking other steps such as buying a protective call.

  Mark Davis   10/8/200,  2:53:11 PM
Short @ 1127.50, lower stop to 1122.50
It's tempting to lower the stop to 1121.50 (feel free to do so), but we already have a pile of points in the bank today and I don't want to get too close to the action, get stopped out and then watch a real selling frenzy from the sidelines. BTW, you can also bank another +7 points right now if you want.

  Jonathan Levinson   10/8/200,  2:50:21 PM
35.65 QQQ is new short cycle resistance. The bullish divergences have launched new downphases from those higher lows, and are running down with the price. Lower 30 and 60 min channel support line up at 35.51 currently.

  Linda Piazza   10/8/200,  2:50:03 PM
The OEX is about to hit lower Keltner channel support on the 15-minute chart, with that support now at 537.68. The 38.2% retracement of the climb off the August low is at about 537.11.

  Linda Piazza   10/8/200,  2:48:16 PM
Unless the OEX bounces above 540.80 by the end of the day and leaves only a shadow below its daily 100/130-ema's, this fall has probably been deep enough to negate the potential inverse H&S on the OEX's daily and 382-minute charts. As I mentioned last night, it was a continuation-form inverse H&S with a head that was way out of proportion to its shoulders, so I always distrusted it, but that didn't mean I wasn't going to watch it.

Continue to put your profit-protecting plans in place as the OEX drops closer to 537-538. It's possible this could be a drop-into-the-close day, but bounce potential strengthens as the OEX approaches that zone.

  Jeff Bailey   10/8/200,  2:46:34 PM
Day trade short alert .... for Biogen/Idec (BIIB) $58.98 here, stop 59.20, target $58.01.

  Jeff Bailey   10/8/200,  2:44:58 PM
TRIN 2.29 +98% ... high of the day.

  Linda Piazza   10/8/200,  2:39:02 PM
One note, too: The Nikkei is also closed Monday, so we won't be seeing it react to today's losses in the U.S. markets. Without a Nikkei decline to match our decline, that may allow our markets to at least drift, if not attempt a bounce. This is pure conjecture, however, and the European markets will be trading.

  Stephen Tetreault   10/8/200,  2:36:18 PM
I'm looking for a bullish reversal, as we should see positioning as the bond market has closed, and it is also closed on Monday, hence hedging opportunities on crude will be diminished, hence looking at crude retracing after the weekend (if the patch remains risk free) and the hedge fund community should be able to power this market into the close....very light volume on indexes vs. Heavy Futures and Option Volume (Disclosuer, I'm long the Es at 1123.50), they are positioning themselves to power make the move leter to day into Monday on thin volume trading, as many firms are behind the trade today (they bet on the wrong side) JMHO

  Linda Piazza   10/8/200,  2:34:34 PM
OEX low has been 538.32, but it's attempting a bounce now. Turning back to the 7-minute chart, I see Keltner resistance massing from 539.46-539.81 and appearing again at 540.27. Bears want to see that hold.

  Jeff Bailey   10/8/200,  2:32:48 PM
TRIN 2.17 +88% .... back at WEEKLY R2

  Linda Piazza   10/8/200,  2:32:17 PM
Russell 2000 is testing the 80.9% retracement of its decline from its late June/early July high down to its August low. The Russell 2000 paused here on the way up and could on the way down, too.

  Mark Davis   10/8/200,  2:31:51 PM
Is the herd finally getting spooky? TRIN @ 2.21

  Jeff Bailey   10/8/200,  2:31:27 PM
QQQ $35.60 ... now looking at weekly pivot $35.50 and 5-MRT Red #6.

  Linda Piazza   10/8/200,  2:31:09 PM
SPX 200-sma approaching at 1119.63 with the SPX at 1121.84.

  Jeff Bailey   10/8/200,  2:30:16 PM
Taser Intl. (TASR) $37.51 -1.55% ....

JDS Uniphase (JDSU) $3.26 -2.1% ....

Paychex (PAYX) $30.13 -3.3% ...

Netease.com (NTEX) $39.05 -3.31% ....

Semi HOLDRs (SMH) $30.55 -4.11% ...

Pfizer (PFE) $30.04 +0.1% ....

Lehman iShare 1-3 (SHY) $81.97 +0.22% ...

  Linda Piazza   10/8/200,  2:30:07 PM
OEX 537-538 is getting closer. The 15-minute Keltner lowest support slips now to 537.81.

  Mark Davis   10/8/200,  2:29:02 PM
Beaten down bulls must be questioning whether or not to step in again here. They have been repeatedly stopped out of every attempt to go long today.

  Linda Piazza   10/8/200,  2:27:23 PM
OEX bearish traders, begin considering how you'll handle a test of 537-538. Automatic profit-taking and a little leaping around your office before closing up shop early for the day? Stepping out of positions in partial lots? Rolling into a new position, perhaps using only part of your profits? Buying a protective call? Just following the OEX lower with your stops? Some of those measures should already be in place, since bounce potential strengthens.

  Mark Davis   10/8/200,  2:24:19 PM
Short @ 1127.50, lower stop to 1124.50

  Linda Piazza   10/8/200,  2:23:51 PM
On the 15-minute Keltner chart, at least, there's nothing to support the OEX between here and 537.90-538.

  Linda Piazza   10/8/200,  2:22:27 PM
OEX bears want to see continued 15-minute closes beneath the Keltner line currently at 540.48 to preserve the downside target on that chart, now at 537.89. Bears would actually prefer 15-minute closes beneath the Keltner line currently at 539.58.

  Jonathan Levinson   10/8/200,  2:22:03 PM
Wow- the Reuters homepage is a veritable bundle of joy today :(

  Jonathan Levinson   10/8/200,  2:20:37 PM
Reuters reporting wildcat strikes by Nigerian oil workers.

  Linda Piazza   10/8/200,  2:20:14 PM
The OEX breaches the bottom support on the seven-minute Keltner chart. This is the first time today, in fact since September 28, that it has done so.

  Jeff Bailey   10/8/200,  2:20:10 PM
Sell Program Premium .... SPX 1,123.73, QQQ $35.68

  Mark Davis   10/8/200,  2:19:59 PM
New lows coming... my screen just lit up like a Christmas tree

  Jonathan Levinson   10/8/200,  2:19:30 PM
Nymex crude is trading 53.05, off a high of 53.175 on news (secondhand) that Nigeria oil talks are off the rails. Looking for confirmation now.

  Mark Davis   10/8/200,  2:18:58 PM
Stopped out of short @ 1124.50, -0.50

  Linda Piazza   10/8/200,  2:17:17 PM
One note related to options expiration: if any are in bearish OEX positions with front-month (October) options, your profit-protecting plans might embody a suggestion of Mark's yesterday. You might take profits on a dip and roll forward into November or later puts (hopefully on a bounce) if you feel there's further downside to be had. One way McMillan suggests of protecting profits is to sell all of a position and use only part of the profits to roll down into a lower strike or out into a later-month strike, and a bounce isn't necessary, although desirable in such a maneuver. That way you've pocketed some profits and they're safe, but have allowed yourself to participate in further declines if they're offered. I think that if the OEX does drop anywhere near that 538 level today, there's a big chance of bouncing from that level, so that some might elect to take most/all profits this afternoon and then wait to see what develops on Monday. That might be true if the OEX ends near the current level, too. The lower the OEX goes toward 537-538, the more bounce potential builds, although I'll consider that bounce a countertrend one until proven otherwise.

  Jeff Bailey   10/8/200,  2:16:15 PM
NDX.X .... option chain has the 1,450 calls 1,779, and the 1,475 call 1,315 and 1,375 put 1,311 equally matched.

VXN.X 20.29 -1.45% ...

  Mark Davis   10/8/200,  2:15:26 PM
Short @ 1127.50, lower stop to 1125.50
Long @ 1125.00, stop 1124.50

  Jonathan Levinson   10/8/200,  2:13:04 PM
QQQ is finding support at 35.72 QQQ and trying for a bounce. There's a new potential short cycle bullish divergence possibility, but this time resistance is at that lower 35.80 level.

  Jeff Bailey   10/8/200,  2:13:02 PM
02:00 Internals at this Link

  Mark Davis   10/8/200,  2:11:29 PM
Go long again... 1125.00, stop 1124.50

  Mark Davis   10/8/200,  2:10:21 PM
I do not understand why the market refuses to capitulate. It's just a slow grind downward. I guess that is the kind of decline that really kills bulls. They keep hoping it will turn around. If we keep grinding lower I would think the herd should spook at some point, hopefully TODAY.

  Jonathan Levinson   10/8/200,  2:08:43 PM
QQQ testing 35.72 support now. 35.80 is new resistance.

  Jonathan Levinson   10/8/200,  2:08:17 PM
Gold and silver are solid, with HUI +3.37% and XAU +2.59% currently. Gold 424.30, silver 7.285.

  Jonathan Levinson   10/8/200,  2:06:17 PM
QQQ chart updated at this Link.

  Linda Piazza   10/8/200,  2:05:37 PM
Bearish OEX traders should continue following the OEX lower with their stops. I haven't recommended another purchase of a protective call position since recommending that such a position be sold earlier today because the OEX is perhaps setting up that potential target near 538. The OEX could bounce anywhere through here, but the drop down toward 538 is looking more and more likely, so I didn't want to suggest a protective call position just yet. I may be wrong, especially since the decline continues to have a bullish falling wedge look about it, and all bearish traders should continue to have profit-protecting plans in place.

  Jeff Bailey   10/8/200,  2:04:39 PM
02:00 Market Watch at this Link

  Jonathan Levinson   10/8/200,  2:03:17 PM
QQQ looks like it's losing it here, less than 2 cents below 35.80 and in range for a throwunder, but the simultaneous lows in ES, INTC and GE make it look like the real thing. Volume is picking up on the sell side as I type.

  Jeff Bailey   10/8/200,  2:02:57 PM
SOX.X trades WEEKLY Pivot 391.50 here.

QQQ $35.79.

  Linda Piazza   10/8/200,  2:02:43 PM
The TRAN fell back, but is now between Keltner support down to 3330.44 and Keltner resistance up to 3344 on the 15-minute chart.

  Mark Davis   10/8/200,  2:02:41 PM
Stopped out of long play @ 1125.29 and break even

  Linda Piazza   10/8/200,  1:59:51 PM
The OEX is attempting to bounce from the bottom Keltner support on the seven-minute chart, something it's done each time it tested that support today. However, the bounce is not yet convincing.

  Mark Davis   10/8/200,  1:58:58 PM
Short @ 1127.50, stop 1127.50 and break even
Long @ 1125.29, stop 1125.29 and break even

I know the stop on the long play is really tight but LOD was 1125.22 and if we get back down to 1125.29 again I don't think we'll stop there. We have the market bracketed again with zero risk plays and a +2 point spread.

  Jonathan Levinson   10/8/200,  1:57:47 PM
35.80 QQQ is still hanging in there. There's no surge in volume, and so it still looks vulnerable- could go either way here, and the pause indicates that the market is waiting to issue its verdict. The short cycles are also on the brink. A wavelet downphase is just bottoming here.

  Mark Davis   10/8/200,  1:53:22 PM
Go long now... 1125.29

  Linda Piazza   10/8/200,  1:52:13 PM
The OEX touches the 7-minute bottom Keltner support.

  Linda Piazza   10/8/200,  1:50:27 PM
So now I know where markets go off to when they're declining? (See my question in my 13:46 post.)

  Mark Davis   10/8/200,  1:50:23 PM
There goes 1126... now let's get 1125.43 and a new LOD (watch for a possible bounce right at or just below LOD)

  Jane Fox   10/8/200,  1:50:00 PM
Do or doo doo - Jonathan I love it!

  Linda Piazza   10/8/200,  1:49:08 PM
OEX seven-minute bottom Keltner support is at 539.92. So far today, the OEX has bounced from each touch of that bottom support, but will it this time?

  Jonathan Levinson   10/8/200,  1:48:54 PM
QQQ sitting on the previous 35.80 low here. Do or doo doo time for the bulls.

  Jim Brown   10/8/200,  1:47:15 PM
CNBC has the latest apprentice casualty on air right now. I saw an interview with Bradford last week and he said the boardroom scenes take 4-5 hours to shoot. Everybody has to repeat lines, camera angles, etc, for hours until they feel they have it right. Considering it only takes about 5-7 minutes on air you wonder how much reality is really involved in this reality TV. Also, the entire cast has to stay in seclusion for the 6-8 weeks they are filming. If you are the first one fired you have to hang around in alternate quarters until all but the last weeks session is over. Rumors are that everyone has to sign a $2 million performance guarantee to maintain complete silence about the outcome until the end. That kind of club would keep anybody quiet.

  Linda Piazza   10/8/200,  1:46:46 PM
The OEX appears to be breaking through the bear flag it established after breaking above the triangle it had previously established, morphing from one formation to another. Now it's hitting a new low of the day, but be wary of a quick bounce that soon reverses this decline, as this is right smack in the prime stop-running time of day. Bears do not want to see a quick reversal. This was a test by big-money people to see if dips are going to be bought. If they are, and are strongly, then it's off to the races. If they're not, it's . . . where do markets go off to when they're declining? The 15-minute chart now does show that possible downside target near 538.08, but that requires continued 15-minute closes beneath the Keltner lines currently at 540.74 and 541.03, and will require new parameters as the afternoon goes on.

  Mark Davis   10/8/200,  1:44:55 PM
I'd really love to see 1126 taken out to give the short some juice... a new LOD would be even better but we're still chopping around and we need to get going here or will be in danger of even more chopping around... at least the TRIN is on our side and the Dow is only 1 point above a new LOD.

  Mark Davis   10/8/200,  1:39:56 PM
Short @ 1127.50, lower stop to 1127.50 and break even

  Linda Piazza   10/8/200,  1:39:32 PM
Reader Question: What parameters do you have set for the Keltner lines you are referring to?

Response: Glad you asked! Here's a link to an article detailing how I use Keltner charts and also two configurations I have tried (near the end of the article): Link This reader also wanted to know about the time intervals I use to study developments. I most typically watch three-minute, five-minute, and fifteen-minute charts for short-term developments, such as those that might help daytraders. Here's a 15-minute chart for the TRAN: Link Lately, however, I've often turned to the seven-minute chart for the OEX, as some channel lines that were being breached on the five-minute chart are holding on the seven-minute one: Link I watch both daily and weekly Keltner charts for an overall sense of where the markets might be going. Back in February, it was bearish-divergence Keltner style as compared to developments that were last seen in March 2002 that warned me that the markets might trend lower, toward the midlines of their weekly channels. That's happened.

  Jonathan Levinson   10/8/200,  1:38:11 PM
Those bullish divergences are going to abort after the weak bounce attempt. 35.99 never got tickled. Bulls can hope for a double bottom at 35.80 to attract the buy-bots, but if that level breaks, 35.72 support will be next in the crosshairs, and the short cycle oscillators are no longer deeply oversold: Link

  Mark Davis   10/8/200,  1:37:49 PM
Stopped out of long play @ 1126.86 and break even
Short @ 1127.50, stop 1128.50

  Mark Davis   10/8/200,  1:35:06 PM
Short @ 1127.50, stop 1128.50
Long @ 1126.86, stop 1126.86 and break even

It feels like something is going to give here. I don't know which way but I don't want to miss it. I'd prefer a downside break not only because the long play is set to stop out at break even, but also because a downside break could go a long way, whereas I think a long play may advance with difficulty.

  Mark Davis   10/8/200,  1:26:15 PM
Go short again... 1127.50, stop 1128.50

  Linda Piazza   10/8/200,  1:25:29 PM
Even the TRIN appears to be coiling up into a triangle.

  Jonathan Levinson   10/8/200,  1:21:24 PM
Bulls are getting nowhere fast with these short cycle divergences. The TRIX and Macd are still drifting up, but price is getting very poor traction. If bulls can't even tag the bottom of 35.99-36.02 resistance, then the failure will be very likely to at least retest the session lows. A wavelet upphase is about 80% done here, and I'd guess that there are another 5 minutes max before it rolls over.

  Jeff Bailey   10/8/200,  1:15:39 PM
01:00 Internals at this Link

  Mark Davis   10/8/200,  1:11:37 PM
Stepping outside for a few minutes...

  Jonathan Levinson   10/8/200,  1:11:30 PM
Gold is trading 424.60, and HUI and XAU are back up to a 3.42% and 2.7% gain respectively. Nymex crude is also up, currently 52.85.

  Jeff Bailey   10/8/200,  1:08:49 PM
01:00 Market Watch at this Link

  Linda Piazza   10/8/200,  1:07:55 PM
OEX bears would prefer to see the current 15-minute period close beneath the Keltner line currently at 541.32.

  Mark Davis   10/8/200,  1:07:10 PM
Long @ 1126.86, raise stop to 1126.86 and break even

  Linda Piazza   10/8/200,  1:04:53 PM
The TRAN has retraced just over 61.8% of the day's range.

  Jonathan Levinson   10/8/200,  1:04:45 PM
QQQ updated chart at this Link.

  Jonathan Levinson   10/8/200,  1:03:48 PM
QQQ has made it over 35.90, starting to make good on those bullish-D's, but volume is so far declining as price advances. I don't expect 35.99-36.02 resistance to give up easily.

  Linda Piazza   10/8/200,  1:03:24 PM
The OEX just broke above the top of the triangle at the bottom of the day's decline, but has not yet recouped even 38.2% of the day's decline. The rise off the day's low could now be resolving into a bear flag. Nevertheless, bearish OEX players need to have their profit-protecting plans in place.

  Jeff Bailey   10/8/200,  1:01:28 PM
TRIN intra-day chart with QCharts' DAILY and WEEKLY Pivot levels. Link

Thoughts for closing out QQQ bearish, along with Jonathan's oscillator observations.

  Mark Davis   10/8/200,  12:58:22 PM
Stopped out of short @ 1126.86, +6
Now long @ 1126.86, stop 1125.86

  Jeff Bailey   10/8/200,  12:56:40 PM
SOX.X 392.46 -2.7% ....

  Linda Piazza   10/8/200,  12:56:29 PM
After a brief downturn at the 38.2% retracement of the day's range, the TRAN charged back up through that level again and now approaches the 50% retracement of the day's range, just under 3340. The TRAN is at 3338.67 as I type. This thing did not want to break down.

  Jeff Bailey   10/8/200,  12:55:57 PM
NYSE Comp. (NYA.X) 6,660.62 +0.09% .... hasn't wanted to give up opening tick low of 66,51.20, did get re-tested at about 11:40 PM EDT.

  Jeff Bailey   10/8/200,  12:54:24 PM
AMAT $16.30 -5.06% ... session low here.

  Mark Davis   10/8/200,  12:53:02 PM
Short @ 1132.86, lower stop to 1126.86
Go long with a touch of 1126.86

  Linda Piazza   10/8/200,  12:52:28 PM
Is this triangle at the bottom of the OEX decline valid? Link The bottom trendline is actually an extension of the rising trendline off the 9/28 low, so is a relatively long-term and therefore more important trendline.

  Jeff Bailey   10/8/200,  12:50:59 PM
NASDAQ-100 Index option action the Oct. 1,500 calls (ndv-jj) $0.80 moving in volume of 1,000

  Jonathan Levinson   10/8/200,  12:50:23 PM
Shorts who feel inclined to press their bets would place stops just north of the key confluence resistance, say around 36.05. I'd be inclined to just ignore the oversold short cycle bullish-divergences, but extension on the 30 min cycle- buried in oversold- makes a strong bounce that much more likely.

  Jeff Bailey   10/8/200,  12:46:41 PM
Ok Jonathan.... .... Day trade bearish close out alert for the QQQ $35.83 -1.13% here.

Did kiss $35.80 just minutes ago, and several observation of support have been holding.

  Linda Piazza   10/8/200,  12:44:11 PM
The OEX approached its day's and attempts another bounce.

  Jonathan Levinson   10/8/200,  12:43:44 PM
There are short cycle bullish divergences galore on the QQQ chart- TRIX, Macd, stochastic, the works. A break above 35.98 will kick off a short cycle upphase, and the 30 min cycle is oversold as well. In other words, a strong upward break to last approximately 1 day could launch from these levels, and a move above 35.99-36.02 would be the first step.

  Linda Piazza   10/8/200,  12:42:16 PM
The OEX tests the neckline of the formation displayed in the chart linked to my 12:34 post. A move above 541.47 would be needed to confirm that formation. So far, however, the OEX turns back from a test of the neckline.

  Mark Davis   10/8/200,  12:41:35 PM
You can drive yourself nutso on a day like today trying to scrutinize 1/4 point moves. If I try another long play somebody please slap me. I'm staying short and if I get stopped out so be it.

  Jeff Bailey   10/8/200,  12:40:18 PM
ST Micro (STM) $17.89 +0.16% Link .... only SOX.X component to post green.

Applied Materials (AMAT) $16.31 -4.95% Link .... still weakest today.

Maxim Integrated (MXIM) $43.25 -1.99% ... just gave a double-top buy signal at $45 yesterday (traded $45.04), but we can get the impression that sector bulls still not overly sure of things.

  Linda Piazza   10/8/200,  12:38:02 PM
The TRAN hit the 38.2% retracement of its day's range almost exactly and then turned down. Its 15-minute pattern now looks like a potential bear flag building off the test of one breakdown level on the 15-minute chart. I've got an al_rt set for a TRAN move below 3330, because a 15-minute close below the Keltner line at 3330.16 would set up that next breakdown target of 3296-3300 for the TRAN.

  Jeff Bailey   10/8/200,  12:36:52 PM
S&P Insurance ($IUX.X) 313.98 (unch) .... tests openin session low. AIG $67.27 +0.68% Link received an upgrade this morning.

  Jonathan Levinson   10/8/200,  12:35:44 PM
Session low for QQQ and NQ here. 30 min channel support is down to 35.70.

  Mark Davis   10/8/200,  12:35:13 PM
Here's the move and it is indeed down... how far will it go???

  Linda Piazza   10/8/200,  12:34:23 PM
Like Mark, I'm questioning my suggestion that any who bought protective call positions on their OEX bearish plays near 540.80 consider closing out those positions if the OEX didn't soon bump over 541.50, because now there's this potential inverse H&S on the OEX's one-minute chart: Link Bears want the OEX to continue dropping toward the day's low . . . with a drop beginning after I uploaded the chart and as I finished this post.

  Mark Davis   10/8/200,  12:32:44 PM
B-bands are as tight as they have been all day... we may see a move away from 1127 here pretty soon. CCI and TRIN say down (but they lie sometimes)

  Jonathan Levinson   10/8/200,  12:31:33 PM
QQQ flatlined below 35.90. Link

  Jeff Bailey   10/8/200,  12:30:17 PM
NASDAQ-100 option chain update Oct. 1,450 still most active of those shown from last night. Oct. 1,450 call $10.20 (1,491 : 2,558), but the Oct. 1,375 put $1.30 moves up to #2 (1,059 :4016).

Split these two strikes and I get 1,412.50.

  Mark Davis   10/8/200,  12:28:46 PM
Starting to slide again...

  Linda Piazza   10/8/200,  12:28:00 PM
The OEX needs to move over the last one-minute high at 541.47 or it sets up the possibility that it could be rolling down again, perhaps just to retest the day's low. Those who might have bought a protective call position might give some consideration to closing out that position without a quick move above that last one-minute high.

The TRAN his the 38.2% retracement of its day's range as I type.

  Jim Brown   10/8/200,  12:27:46 PM
FR Board: Speech by Vice Chairman Ferguson
Safeguarding Good Policy Practice through Maintaining Flexibility Link

  Linda Piazza   10/8/200,  12:23:14 PM
The TRAN has risen almost to a 38.2% retracement of the day's range, at about 3337, with the TRAN at 3336.26 as I type. The TRAN's pattern narrows as it climbs, warning of a potential bearish rising wedge.

  Jeff Bailey   10/8/200,  12:22:55 PM
SOX.X 393.35 -2.48% .... came close to WEEKLY Pivot with session low so far of 391.53. Not sure if traders saw the SOX.X chart from 11:00 AM EDT update with conventional retracement, so here it is. Link

  Linda Piazza   10/8/200,  12:20:58 PM
The OEX may already be dropping out of the possible bear flag that it established as it began climbing off the day's low, but it's traded sideways since and could be just reforming that flag into a wider flag. It could perhaps need to drop to 540.70-540.90 to reestablish support before widening it. A drop much below that would undo the flag possibility, though.

  Jeff Bailey   10/8/200,  12:20:50 PM
Bearish day trade cancel target alert .... Cancel the QQQ bearish target of $35.80 at this point. We're at a big support level right here, and if broken, more than likely would see a QQQ further below $35.80.

Bearish day trade lower stop alert

But lets lower our stop to $36.15.

  Jeff Bailey   10/8/200,  12:18:34 PM
Updated e-mini NASDAQ (nq04z) 10-min delayed ... at this Link Rather incredible.

  Mark Davis   10/8/200,  12:15:57 PM
I'm not sure if I just dodged a bullet (got out break even) or shot myself in the foot (exited too early) with the attempted long play from 1127. We could definitely go higher from here but SPX just printed a sell signal right @ 1127 and the index is going sideways.

  Linda Piazza   10/8/200,  12:11:01 PM
The OEX rises off the morning's low of 540.50. Those in bearish positions would like to see the OEX retrace no more than 50% of the day's range, with that 50% mark at about 542.18. They'd prefer to see the OEX retrace 38.2% or less, with the 38.2% mark at about 541.78.

  Mark Davis   10/8/200,  12:09:17 PM
Stopped out of long play @ 1127 and break even

  Mark Davis   10/8/200,  12:08:40 PM
Short @ 1132.86, lower stop to 1128.86
Long @ 1127, raise stop to 1127 and break even

  Jeff Bailey   10/8/200,  12:08:23 PM
12:00 Internals at this Link

  Mark Davis   10/8/200,  12:04:28 PM
Now long @ 1127, stop 1126

  Linda Piazza   10/8/200,  12:03:52 PM
VIX at 14.68; VXO at 14.65.

  Jeff Bailey   10/8/200,  12:01:49 PM
12:00 Market Watch at this Link

  Mark Davis   10/8/200,  12:00:57 PM
Go long with a touch of 1127, stop 1126

  Jonathan Levinson   10/8/200,  11:56:03 AM
The short cycle Macd and TRIX oscillators are doing a slow, weak rollover after the latest abortive bounce attempt on QQQ. There was no volume spike at the current 35.829 low, and I see little to suggest a high odds bounce attempt from here. 30 and 60 min channels continue to decline steeply- current support lines up with 35.72 QQQ.

  Linda Piazza   10/8/200,  11:52:05 AM
Here's a SOX 382-minute chart I've been posting over the last week: Link

  Linda Piazza   10/8/200,  11:45:49 AM
Bearish OEX traders still need that profit-protecting plan in place. Those who want to stay in longer-term but want to protect against a potential bounce could choose this 540.80 level at which to buy a protective call position.

  Linda Piazza   10/8/200,  11:44:24 AM
The TRAN still isn't confirming a new downside target and still clings to the breakdown level. There's no definitive answer as to whether it will break down or bounce, since its 15-minute candles sit right on the Keltner lines that produce the signals.

  Jonathan Levinson   10/8/200,  11:40:14 AM
Session low for NQ here.

  Tab Gilles   10/8/200,  11:40:00 AM
Attached is a chart of the GHA and my observations. The GHA makes up 37.25 of the NASDAQ 100 as the largest sector weighting. I'm looking for a pullback to the 20-ema. Link

  Linda Piazza   10/8/200,  11:33:06 AM
In addition to the potential support detailed in my 11:28 post, the OEX also now tests the 100/130-ema's on its daily chart, with those averages at 540.72 and 540.65, respectively. A strong draft below those averages would wipe out the potential inverse H&S on that daily chart, as it would signify a downturn below the appropriate right-shoulder level.

  Linda Piazza   10/8/200,  11:30:32 AM
Careful, market bears. The TRAN did not participate in that last tumble. It's still trying to cling to one breakdown level on its 15-minute chart, with that breakdown setting a downside target just below 3300. It looks entirely possible that the TRAN will eventually break and start that new leg down, but it hasn't yet.

  Jonathan Levinson   10/8/200,  11:30:06 AM
Gold is holding up, +4.7 at 424.30 currently. Note the high volume on today's move, with 1577 e-mini contracts traded so far. The trouble is that if gold closed right now at current levels, there would be a high volume doji reversal for the day at the top of its current run below the high of 428.20. Of course, a gravestone doji requires a negative print, and here gold is positive, but the move nevertheless reflects a high-speed, high-volume rejection from the high.

  Linda Piazza   10/8/200,  11:28:06 AM
The OEX is fast approaching/entering the 540.80 S/R number and the ascending trendline off the 9/28 low, with that trendline now at about 540.40. Bears should have profit-protecting plans in mind as this potential bounce zone is approached. Following the OEX lower with stops is one of the simplest.

  Jonathan Levinson   10/8/200,  11:27:51 AM
Session low for ES and NQ futures here- QQQ is 1 cent away from its 35.86 low. Still looking good for a test of 35.79 and 35.72 support.

  Mark Davis   10/8/200,  11:23:07 AM
If you're feeling brave this could be a good place to try a long play (SPX 1127 area). Personally I'm not going to try and get cute... the TRIN is just too high.

  Linda Piazza   10/8/200,  11:18:45 AM
NDX 100 less than 2 points away from its 200-sma as I type, and was earlier less than 1 point away.

  Mark Davis   10/8/200,  11:18:30 AM
There goes Dow 10100... TRIN @ 2.17

  Linda Piazza   10/8/200,  11:17:10 AM
Thanks, Jonathan, for your input about the repo today.

  Linda Piazza   10/8/200,  11:16:07 AM
OEX bears would certainly like to see continued fifteen-minute closes beneath the Keltner line currently at 542.58, but should probably assess their willingness to stick around for a test of 543.30-543.80, too. The OEX's decline is beginning to take on a bit too much of a bullish falling wedge look to the liking of those in bearish positions, but we've seen a number of these wedges break to the wrong direction lately, too.

  Jonathan Levinson   10/8/200,  11:13:32 AM
Linda, note that the Fed's 1.25B net repo add isn't a very big deal. While it will certainly be a help rather than a hindrance to the markets, it's a small amount by the Fed's standards. I'd be inclined to consider it neutral.

  Jonathan Levinson   10/8/200,  11:11:53 AM
Look for new resistance from 35.99-36.05, former strong support. QQQ's short cycle oscillators are nearing the bottom of their range in a strong downphase, with the previous attempted upphase aborting almost immediately after it kicked off. Crude oil is down to 52.275, further off its highs.

  James Brown   10/8/200,  11:10:52 AM
Dueling analysts? Yesterday BAC upgraded HOTT to a "buy". Today Wachovia downgrades the stock to an "under perform".

  Linda Piazza   10/8/200,  11:10:18 AM
Referencing Mark's 11:05 post and Marc's 11:08 one (possibly on the Futures side), Jonathan's 10:18 post about the Fed's net infusion of cash today might be one clue as to whether a meltdown pre-debate will be allowed or not.

  Jeff Bailey   10/8/200,  11:05:54 AM
11:00 Market Watch at this Link

  Linda Piazza   10/8/200,  11:05:16 AM
The TRAN's 15-minute Keltner chart now shows a possibility that the TRAN could tumble down into a retest of 3395-3300. It's hanging on by the fingernails (front bumpers? tire treads?) to the breakdown level necessary to confirm that possible downside target. Fifteen-minute closes above the Keltner line currently at 3332.93 or particularly above the Keltner line currently at 3339.25 would put that downside target in more doubt.

  Mark Davis   10/8/200,  11:05:11 AM
We're on the verge of a serious breakdown IMO. It probably won't happen (because I think it will) but I'm watching Dow 10100 to see if it holds.

  Jonathan Levinson   10/8/200,  11:03:24 AM
Nasdaq TRIN (TRINQ) currently 1.34, reflecting only light selling pressure so far.

  Linda Piazza   10/8/200,  11:02:09 AM
GE, MER, and CSCO still test their weekly 200-sma's, with CSCO now a few cents below its 200-week SMA. Weekly MACD appears flat on all three.

  Mark Davis   10/8/200,  11:00:07 AM
I just corrected some erroneous numbers in my 10:55 post

  James Brown   10/8/200,  10:59:34 AM
LLTC is rolling over under the simple 200-dma for the sixth time since April.

  Linda Piazza   10/8/200,  10:59:28 AM
The OEX again attempts a downside breakout on the five-minute Keltner channels, and needs a five-minute close beneath the Keltner line currently at 541.12 to accomplish that breakout. Continue to follow the OEX lower with your stops.

  James Brown   10/8/200,  10:58:25 AM
Starbucks (SBUX) surged to a new all-time high this morning after UBS upgraded the stock from "neutral" to a "buy" and raised its price target to $56.

  Mark Davis   10/8/200,  10:58:07 AM
Stopped out of long play @ 1127.68, -1

  Linda Piazza   10/8/200,  10:57:19 AM
The GSO is now testing its 200-sma, sinking a little below it. The GSO was turned back this week at a descending trendline that has been in place since early 2002, with the 200-week sma lurking just above that trendline. The GHA has been dropping for two days now, too, but remains above both the 200-day and 200-week sma's.

  James Brown   10/8/200,  10:56:25 AM
Prudential starts coverage of semiconductor maker KLAC with an "over weight" rating today but shares of KLAC are down 3.7% as the SOX sinks lower.

  Jeff Bailey   10/8/200,  10:56:13 AM
That Monster Worldwide index has been seriously off the past two months. August looked very weak, nonfarm was to upside. September looked strong, September nonfarm weaker than expected.

  Mark Davis   10/8/200,  10:55:46 AM
Short @ 1132.86, stop 1132.86 and break even
Long @ 1128.68, stop 1127.68
We have the market bracketed with +4 points guaranteed. I had to try the long play because we were right at the edge of the cliff and I've learned from the school of hard knocks that we rarely fall off. If we do suffer a rare cliff dive then we still have the short working for us.

  Linda Piazza   10/8/200,  10:54:21 AM
NDX 100 approaches its 200-sma, now only a little more than 3 points below.

  Jeff Bailey   10/8/200,  10:54:14 AM
VIX.X 13.98 -3.58% ..... SPX.X 1,128.73

  Jeff Bailey   10/8/200,  10:53:27 AM
Paychex (PAYX) $30.27 -2.85% ... slips back below its 50-day SMA.

  Jonathan Levinson   10/8/200,  10:53:19 AM
The 30 min cycle downphase rolled back lower, but it's not sufficiently oversold to constitute a genuine trending move. The 60 min cycle downphase is in full bloom has yet to reach oversold.

  Jeff Bailey   10/8/200,  10:52:42 AM
Disk Drive Index (DDX.X) 110.68 -1.54% .... about to test the 110 level which was May and June resitance recently broken to upside.

  Jeff Bailey   10/8/200,  10:51:15 AM
SOX.X 392.99 -2.57% ... nearing WEEKLY Pivot (391.50) and rising 21-day SMA (391.48)

QQQ $35.92 -0.88% ...

  Jeff Bailey   10/8/200,  10:49:54 AM
TRIN 1.80 +53.84% .... WEEKLY Pivot levels are Piv = 0.82 R1= 1.30, R2= 2.17

  James Brown   10/8/200,  10:48:46 AM
Copper prices are really on the move. The metal is surging another 2.27% to $1.46 a pound this morning. These are multi-year highs. Shares of Phelps Dodge (PD) continues to climb and is bouncing from the 95 level.

  Jonathan Levinson   10/8/200,  10:48:39 AM
QQQ is breaking below the premarket low of 35.99 and is heading for 30 min channel support now. If it doesn't bounce quickly, the channels will turn down steeply. Next fib support is 35.79 and 35.72.

  Mark Davis   10/8/200,  10:48:32 AM
Go long now @ 1128.68, stop 1127.68

  Jeff Bailey   10/8/200,  10:46:54 AM
5-year yield ($FVX.X) 3.394% down 13 bp and sitting right on 33.84 retracement and 200-day SMA.

SHY $81.97 +0.24% .... testing both 21-day SMA and 50-day SMA.

  James Brown   10/8/200,  10:45:10 AM
OI put play FLIR is down 2.9% and is breaking support near $57.50 and its simple 100-dma.

  Mark Davis   10/8/200,  10:44:51 AM
Again I'm tempted to go long here @ 1129.63 but I look at the TRIN and it scares me.

  James Brown   10/8/200,  10:43:46 AM
Readers can keep an eye on GDW. Our target is the $115.50-116.00 range and the stock is up 1% to $114.63.

  Linda Piazza   10/8/200,  10:43:23 AM
The OEX saw a relatively big drop yesterday, big enough to form a bearish engulfing candle, so it wouldn't be surprising to see a tighter range today. If so, we could already have seen most of that range covered, with perhaps a deeper dip down toward 540-541 not out of the realm of possibility and maybe a bounce attempt from there, ultimately producing a doji or other indecision-type candle. I didn't think this tighter-range day as likely today as at other times in similar circumstances because of the importance so many had given the jobs numbers and then the tie-in with the presidential debates tonight, but now I'm wondering. TRIN looks as if there could be a bigger drop coming, though. Plus, I have my own chart-o-meter unofficial guideline, too. (Ever notice how often charts, trading platforms slow down as/just before a strong move occurs?) Just be aware of this tight-range possibility when you're making trading decisions today.

  Mark Davis   10/8/200,  10:42:29 AM
Here's a chart I drew yesterday after the bell... Link

  Jonathan Levinson   10/8/200,  10:41:51 AM
QQQ chart update at this Link.

  Jeff Bailey   10/8/200,  10:41:34 AM
NDX.X 1,447.21 -0.59% .... the Oct. 1,400 calls (ndt-jr) volume at 300, 1,450 calls (ndt-js) 259.

VXN.X 20.33 -1.26% ... so I've got to be thinking selling of the calls.

  Mark Davis   10/8/200,  10:39:44 AM
SPX is trying to hold the line, literally... the DOWNTREND line from the March highs sits @ 1130.30. If that gives way the bullish case isn't dead but it might need some oxygen.

  Jeff Bailey   10/8/200,  10:36:50 AM
Day trade short alert for the QQQ $36.04 here, stop $36.20, target $35.80.

  Linda Piazza   10/8/200,  10:35:36 AM
The NDX 100's 200-sma is at 1441.65, with the NDX 100 currently at 1450.02, so some traders, even those not trading the QQQ's or NDX 100 component stocks, might set an al_rt at that level to watch for bounce potential.

  Mark Davis   10/8/200,  10:35:11 AM
I wonder how many bulls chased the train, thinking it was about to get away from them... more than a few I would guess. That leaves the door open for a serious decline if sentiment changes. I also wonder how many over anxious shorts jumped in at the bell, only to have to cover almost immediately... possibly part of the reason for the strong bounce. I'm still amazed at the ability of this market to shake off bad news, especially with TRIN @ 1.64.

  Jonathan Levinson   10/8/200,  10:31:41 AM
The extreme oversold condition that followed the jobs report is now absent. QQQ is back to the top of lower confluence support, while the TRINQ is down to 1.23- this just above neutral territory.

  Jeff Bailey   10/8/200,  10:31:41 AM
QQQ $36.08 -0.44% ..... sessiion low was opening tick at $36.02

  Jeff Bailey   10/8/200,  10:30:59 AM
SOX.X 395.34 -1.98% .... does make a session low.

  Jeff Bailey   10/8/200,  10:30:01 AM
VIX.X 13.88 -4.27% ... not sure if that was a bad tick on the VIX.X or not, but it just jumped to 14.43 now back lower.

SPX.X 1,130.88 here.

  Linda Piazza   10/8/200,  10:28:12 AM
SOX at a new daily low.

  Jeff Bailey   10/8/200,  10:27:31 AM
NASDAQ-100 Index (NDX.X) 1,451.71 -0.27% .... of those options I showed late last night (10:32:45), the Oct. 1,450 call 255:2,558 is the most active with last $15.20.

the Oct. 1,475 calls are next at 62:5,302 last $5.50.

  Linda Piazza   10/8/200,  10:26:28 AM
The TRAN has now given up the 3350 test, at 3343.65 as I type. Market bears want to see a new daily low.

  Jonathan Levinson   10/8/200,  10:26:00 AM
This is so far a weak short cycle upphase in progress, and it will abort on a break below the session low. If the 60 min cycle dominates, we could be looking at a trending oversold move for the 30 min cycle, which would set up a test of 35.85 channel support at minimum.

  Jonathan Levinson   10/8/200,  10:24:29 AM
Nymex crude is moving back up, currently 52.75.

  Jeff Bailey   10/8/200,  10:23:46 AM
VIX.X 13.87 -4.34% ... sitting right on DAILY S1 for last hour of trade.

SPX most active options have Dec. 1,050 puts (3,051 : 47,276), Oct. 1,125 puts (1,783 : 22,099) and Oct. 1,120 puts (1,650 : 11,200)

  Linda Piazza   10/8/200,  10:20:48 AM
The TRAN still battles that 3350-3352 Keltner resistance, and is beginning to turn down, but it needs to show five-minutes closes beneath the Keltner line currently at 3346.84 before we can even begin to believe in the downturn.

  Mark Davis   10/8/200,  10:20:22 AM
"Hair" cut is probably accurate Linda. His coif looks like one hair wrapped round and round and round.

  Jim Brown   10/8/200,  10:19:27 AM
FR Board: Speech by Governor Bernanke
Panel discussion: What Have We Learned Since October 1979? Link

  Linda Piazza   10/8/200,  10:18:41 AM
He has to get a better haircut before I'd take him seriously, Mark.

  Jonathan Levinson   10/8/200,  10:18:18 AM
The Fed has added no further repos to the 7.75B already announced, for a net gain of 1.25B for the day.

  Mark Davis   10/8/200,  10:18:08 AM
Congrats Linda... you're fired! Link

  Linda Piazza   10/8/200,  10:17:58 AM
Thanks, everyone. Jim, it seems as if it were just yesterday for me, too. I still think of myself as the representative for those self-taught traders still trying to learn from my "elders" in the trading and technical analysis fields, although I'm an elder here age-wise.

  Jim Brown   10/8/200,  10:16:24 AM
Congratulations Linda! I am sure readers are looking forward to the next two years. I am amazed at how fast time flies. Seeme like it was just a couple months ago.

  Linda Piazza   10/8/200,  10:15:03 AM
OEX bulls and bears, watch this potential formation: Link

  Jeff Bailey   10/8/200,  10:14:52 AM
10:00 Internals at this Link

Yesterday's internals at this Link

  Linda Piazza   10/8/200,  10:13:09 AM
The OEX is poised between strongest nearby support and strongest nearby resistance on its five-minute Keltner chart, but under the mid-channel level, so still within the bearish side of those channels.

  Jane Fox   10/8/200,  10:11:03 AM
Heh Linda congrats.

  Linda Piazza   10/8/200,  10:10:14 AM
I'm celebrating an anniversary this week, having now been writing for OptionInvestor for two years.

  Tab Gilles   10/8/200,  10:08:16 AM
RUT chart could there be another down draft coming? Link

  Jonathan Levinson   10/8/200,  10:08:04 AM
30 min and 60 min channel downphases continue on QQQ, with 30 min support currently down to 35.85, well below 60 min support at 36.02. The largest volume spikes have been to the upside, but pressure remains on the sell side with the TRINQ currently up at 1.53.

  Linda Piazza   10/8/200,  10:06:35 AM
The TRAN still battles 3350-3352 resistance.

  Linda Piazza   10/8/200,  10:05:24 AM
TRIN moves higher again.

  Jeff Bailey   10/8/200,  10:04:44 AM
10:00 Market Watch at this Link

  Linda Piazza   10/8/200,  10:04:26 AM
The SOX was turned back from 400, but it could still be forming a bear flag that rises up within this morning's gap. Bears want to see the SOX move no higher than midway into that gap while bulls want to see the entire gap closed.

  Mark Davis   10/8/200,  10:02:59 AM
Short @ 1132.86, lower stop to 1132.86 and break even
We nailed the top (fingers crossed)

  Linda Piazza   10/8/200,  10:02:12 AM
The TRAN did bounce from within the zone noted in my 9:39 post, but it's now facing strong Keltner resistance near and just above 3350. Market bulls want to see it top the last five-minute high at 3355.57 while bears want a rollover beneath 3352.

  Jonathan Levinson   10/8/200,  10:00:53 AM



  Mark Davis   10/8/200,  10:00:32 AM
Go short again @ 1132.86, stop 1133.86

  Linda Piazza   10/8/200,  9:58:42 AM
It obviously would have been better to hold onto that protective call position for a while. The OEX now shoots above the 543.34 level at which bears would have liked to see it turned back on 15-minute closes, but we've still got a couple of minutes left in the current 15-minute period. Next 15-minute resistance is at 544.16-544.56.

  Jonathan Levinson   10/8/200,  9:58:19 AM




  Mark Davis   10/8/200,  9:58:02 AM
Stopped out @ 1131.95, +3 ... unbelievable!

  Linda Piazza   10/8/200,  9:56:08 AM
The OEX's daily 100/130-ema's are at 540.76 and 540.68. Historical S/R and various versions of trendlines and Keltner support levels also come into play around that level, with 540.80 once being an OEX number I've typed quite frequently because of its significance. A bounce from or from above that number is also an appropriate right-shoulder level for a potential inverse H&S, so I would be particularly watchful for bounce potential on any approaches to that number without being wedded to the idea that the OEX will bounce. The OEX has at times (9/22, 10/1) fallen or risen quite easily through those averages, but at other times, they're significant in its trading pattern. This is a suggestion about managing risk, not a prediction of likely action.

  Jonathan Levinson   10/8/200,  9:56:08 AM
Yesterday's expiring 6.5B overnight repo has been replaced by a 7.75B 6-day repo for a net 1.25B gain. However, there's still room for an overnight repo to follow it up, which could add substantially more liquidity to the markets should it occur- I'll be watching for a 10AM announcement on this. Also, there's the August wholesale inventories report due at 10.

  Mark Davis   10/8/200,  9:52:34 AM
Raise stop on short play to 1131.95... I'm kind of in disbelief here and thinking we may see a swoosh down later after they suck in a few more longs. If you think we're headed higher feel free to leave the stop @ 1130.95 but I want to give it a little wiggle room.

  Jeff Bailey   10/8/200,  9:51:03 AM
VIX.X 14.09 -2.82% .... DAILY Pivot levels as follows .... 12.92, 13.77, Piv = 14.21 , 15.06, 15.50.

  Jonathan Levinson   10/8/200,  9:48:47 AM
Gold is trading 424.10 here, with HUI up 3.23% to 238.99 and XAU +2.38% at 104.56.

  Jonathan Levinson   10/8/200,  9:46:10 AM


  Jonathan Levinson   10/8/200,  9:44:29 AM
Just lost my IB feed- coming back now, but keep stops on your open positions/orders.

  Linda Piazza   10/8/200,  9:43:53 AM
The OEX's 15-minute chart is suggesting that if the OEX closes this 15-minute period beneath the Keltner lines currently at 542.13-542.26, it's setting up a potential downside target of 538.61. It has not yet closed a 15-minute period below those lines, and may not, since it's now testing them again. Even if there is a breakout on this chart, down toward that designated target, I'd sure have profit-protecting plans in place ahead of 538.61, from the current level, all the way down.

If there's no 15-minute close beneath those lines, the OEX may be headed up for a test of 543-ish resistance.

  Jonathan Levinson   10/8/200,  9:43:21 AM
QQQ still having trouble with the 36.11-.14 confluence zone.

  Jeff Bailey   10/8/200,  9:41:58 AM
Swing Trade exit SHY puts alert ..... Place an order to sell the 5 Lehman 1-3 year iShares Dec. $82 puts (SHY-XD) at $0.60.

  Mark Davis   10/8/200,  9:41:18 AM
Short @ 1134.95, lower stop to 1130.95

  Linda Piazza   10/8/200,  9:39:56 AM
After yesterday's tweezer-top reversal signal, the TRAN continues lower this morning, finally dropping to and now below the 3340 level that Keltners had predicted it would see. Next Keltner support for the TRAN is due between the current level and 3329.70, with the TRAN now at 3333.56.

  Mark Davis   10/8/200,  9:38:57 AM
I'm surprised 1129 is holding but I sure don't feel like going long with TRIN @ 1.60

  Jeff Bailey   10/8/200,  9:38:38 AM
VIX.X 14.40 -0.68% ....

TRIN 1.82 +55.5% ....

  Linda Piazza   10/8/200,  9:36:45 AM
No downside breakout yet on the OEX's five-minute chart. The OEX did pierce the breakout level, but the five-minute close was above it. It's still being tested, but bears would like to see a five-minute close beneath the line currently at 541.85, with that line likely to be pushed slightly lower as the OEX declines.

  Jeff Bailey   10/8/200,  9:36:20 AM
NYSE Comp. ($NYA.X) 6657.96 +0.05% ... only major to hold a gain.

NASDAQ Comp. (COMPX 1,942.67 -0.3% ....

  Linda Piazza   10/8/200,  9:35:16 AM
The OEX struggles with 542.07 first Keltner resistance. Next Keltner resistance above that is at 542.65-542.73.

  Jonathan Levinson   10/8/200,  9:35:12 AM
2-day chart of QQQ at this Link.

  Mark Davis   10/8/200,  9:34:23 AM
Long @ 1130.60, out @ 1129.83, -0.77

  Jonathan Levinson   10/8/200,  9:34:11 AM
QQQ held the 36.00 line and is now bouncing back to test former strong support in the 36.11-.14 zone.

  Jeff Bailey   10/8/200,  9:33:17 AM
Sell Program Premium .... SPX 1,129.18, OEX 541.73, QQQ $36.08.

  Linda Piazza   10/8/200,  9:32:47 AM
With the OEX opening not too far below yesterday's close, bearish traders might consider closing out protective bullish calls bought near yesterday's open, as advised in my 9:21 post.

  Jonathan Levinson   10/8/200,  9:31:05 AM
Daily chart of YG gold e-mini futures are this Link.

  Mark Davis   10/8/200,  9:29:57 AM
Short @ 1134.95, lower stop to 1131.95
Long @ 1131.60, close out the position on the opening print

  Mark Davis   10/8/200,  9:24:36 AM
Well it appears the dye is cast for today and it doesn't look good for bulls at this point. Futures are continuing to slide, currently down -3.00. That's a -5 point drop since the Jobs Report and -8 points since just before GE reported earnings (futures were up +5.10 @ 1335.50 about 1/2 hr before GE reported).
There is one number hidden inside the Jobs Report I was hoping would have an ameliorating effect on the downside surprise.
This means there were 236,000 additional jobs created in the first 9 months of 2004 that they haven't counted yet. That's not too bad when you think about it... over 26,200 extra jobs per month, but evidently it's not enough to turn the tide.
Wall St. now looks ahead to another tough debate for President Bush tonight. No matter who you like personally for the next President you need to realize Wall St. wants Bush. The reason is that Bush is perceived as business friendly and a proponent of lower taxes. Kerry is perceived as a proponent of higher taxes and as the odds for a Kerry victory go up the odds for a stock market rally go down. Paradoxically Kerry will also be able to blame Bush for this.

  Linda Piazza   10/8/200,  9:21:28 AM
OEX bearish traders who might have bought protective calls at the close yesterday might consider selling those protective calls at the open if the OEX opens near yesterday's close. That would take advantage of usually inflated options prices at the open to minimize losses on the protective position. If the OEX should gap lower, however, toward 540-541, the trader has a quandary. That's the very level at which I'd suggest profit-protecting measures for bearish traders, with one of those measures possibly being the purchase of a hedging call position to lock in some profits. It's your call (pun intended) if the OEX should gap lower into that 540-541 level, deciding whether you want to hope for an attempted gap fill to sell that protective position or sell it at the open.

All bearish traders should have profit-protecting plans in mind from the OEX's closing level yesterday down to 539.50, as strong bounce potential exists in this zone and perhaps gets stronger the deeper the OEX moves into the zone. Those measures can be as simple as following the OEX lower with your stops, and as complex as you want them to be. If a bounce begins, all but the most adept scalpers should probably stand aside. We have the potential for an inverse H&S to be forming on the daily chart, but yesterday's bearish engulfing candle wasn't an encouraging development. Until the neckline of that potential formation, the 200-sma, and the 9/13 high are breached, I'll consider all bounces to be countertrend moves.

  Jane Fox   10/8/200,  9:19:54 AM
Dateline WSJ Krispy Kreme Doughnuts Inc. Friday said it was notified by the Securities and Exchange Commission that it had entered a formal order of investigation concerning the company.

The Winston-Salem, N.C., doughnut maker didn't provide any further information.

In July, the SEC began an informal inquiry into Krispy Kreme's lowered earnings guidance and the way the company buys back franchises. Officials at Krispy Kreme have defended their accounting methods and handling of franchise buybacks. Krispy Kreme said then that it is fully cooperating with the SEC.

Krispy Kreme, a once-hot doughnut retailer that has been struggling to reverse a sales slowdown and declining earnings, earlier this week brought in two new independent directors to launch an internal investigation of the company's franchise repurchases and concerns raised by the doughnut chain's auditor. The two directors will make up a newly formed special committee and already have hired an outside law firm, the company said.

  Jonathan Levinson   10/8/200,  9:10:40 AM
QQQ is now working on the lower 36.00-.05 confluence we've been discussing. The shape of the 60 min cycle downphase suggests that it will get broken. Bonds have doubled their earlier gains, with TNX now down 10.6 bps or 2.54% to 4.136%. Gold is currently trading 424.5.

  Jonathan Levinson   10/8/200,  8:50:54 AM
Session high for silver at 7.327, gold currently 425.50 off a high of 428.20.

  Jonathan Levinson   10/8/200,  8:49:55 AM
36.11 QQQ breaking now.

  Jonathan Levinson   10/8/200,  8:43:29 AM
Support has come in from a low of 36.11 QQQ (surprise surprise). The question now is whether that was the terminal move to bottom the 30 min cycle downphase in effect from yesterday. It may have been, except that the 60 min cycle downphase is still young. I'm thinking that the bias remains to the downside below 36.40.

  Jonathan Levinson   10/8/200,  8:36:37 AM
Session high for gold at 421.5, +1.90 here.

  Mark Davis   10/8/200,  8:35:02 AM
Bad Jobs number and a lower revision for July/Aug on top of it. Kerry is somewhere on his knees giving thanks right now.

  Jonathan Levinson   10/8/200,  8:33:52 AM
Bond are higher, TNX -5 bps to 4.194%. Gold is up 1.10, Nymex crude higher at 52.475, and QQQ at a session low of 36.14 currently, right on support to 36.11. The largest move is in bonds.

  Jonathan Levinson   10/8/200,  8:31:47 AM


8:30am DEC. NASDAQ 100 FUTURES DOWN 3.50 AT 1,459.00








  Jonathan Levinson   10/8/200,  8:31:05 AM
Equities are diving on the news. Nonfarm payrolls reported as +96K, downside surprise.

  Jonathan Levinson   10/8/200,  8:27:19 AM
Bonds and foreign currency futures are beginning to rock ahead of the 8:30 data. Equities have advanced and bonds remain net unchanged in the past half hour.

  Jonathan Levinson   10/8/200,  8:01:07 AM
Equities are higher with ES trading 1133.75, NQ 1465.5, YM 10143 and QQQ +.08 at 36.32. Gold is down 20 cents at 419.4, silver flat at 7.21, ten year notes higher by .08 at 111.86 and Nymex crude -.3 at 52.375.

The September employment report is looming at 8:30: Nonfarm payrolls est. 150K, unemployment rate est. 5.4%, hourly earnings +.3%, average workweek est. 33.7. At 10AM, we get wholesale inventories, est. .8%.

  Linda Piazza   10/8/200,  7:01:38 AM
Good morning. Performances in global bourses have been uneven overnight, with many Asian bourses turning lower and many European bourses higher, although even those European bourses were characterized as treading water ahead of the U.S.'s jobs number. Travel-related issues generally took a hit after bombings in Egypt and Paris. Our futures drifted slightly higher while Asian markets trade and added slightly to gains as European markets opened. Crude dropped shortly after European markets opened, too, perhaps accounting for gains in both the U.S. futures and European markets, but crude has been climbing again over the last couple of hours. As of 6:58 EST, crude was up $0.12 to $52.79, and gold was unchanged. More detail about Asian and European markets follows in succeeding paragraphs.

With Softbank promising that it will lower prices for some phone services beyond prices offered by NTT and KDDI, Japanese telephone stocks declined. UFJ Holdings continued its decline after the FSA barred it from lending to new corporate clients in Tokyo and Osaka for six months beginning October 18 and Tokyo's District Public Prosecutors' Office raided the offices of its UFJ Bank. Exporters sank on fears that rising crude prices will hurt global economic growth. Gains in some petroleum-related companies offset those losses, although others did not build on recent gains, but still the Nikkei opened in negative territory and stayed there throughout the day except for two brief climbs into positive territory. The Nikkei never gave up, however, and mounted a late-day climb off its low of the day, managing a close only 5.24 points or 0.05% in the red, at 11,349.35. The Nikkei will be closed Monday for a holiday.

Other Asian markets turned in mixed performances, although most bourses commonly watched in these posts declined. The Taiwan Weighted was almost flat, dropping 0.01%. South Korea's Hynix Semiconductor received an upgrade on its ratings by Standard & Poor's Ratings Services, resulting in a gain of 4.8%. Still, the Kospi fell 0.45%. Singapore's Straits Times lost 0.09%, and Hong Kong's Hang Seng dropped 0.60%. China's Shanghai Composite climbed 1.88%, however, in its first day open since a long holiday.

Currently, European bourses are mixed, but the ones typically followed in these posts turn higher. Explosions in Egypt and outside the Indonesian Embassy in Paris weighed on travel-related stocks. The U.K.-based Hilton fell, with the bombing in Egypt occurring at a Hilton resort. The CFO of Deutsche Lufthansa and the official company stance appeared to differ as the CFO said in an interview that rising crude costs would impede the company's efforts to meet its operating profit target for the year, with the company reiterating its forecast after the interview. In the U.K., oil unions end a two-day warning strike, with oil major Shell affirming that the strike had not affected production or export shipments. Also in the U.K., listed insurers detailed the hits taken by this season's hurricanes, but also noted the anticipated positive effect on rate levels.

As of 6:58 EST, the FTSE 100 had climbed 15.50 points or 0.33%, to 4,714.20. The CAC 40 had gained 7.20 points or 0.19%, to trade at 3,765.90. The DAX had gained 13.93 points or 0.34%, to trade at 4,057.29.

  Jeff Bailey   10/7/200,  10:32:45 PM
Here are a few things I'll be monitoring into next week's expiration.

I've taken the NDX.X option chain, and sorted by October's open interest. Link

The winning trade TODAY was to sell the Oct. 1,475 calls. Again, that was TODAY.

Now.... here's my e-mini NASDAQ-100 futures chart with previously shown dual retracement. Recent 4 sessions "don't make sense," so I have some work to do. Link

Here I show with one additional "fitted 38.2", where if fit the 38.2% at the 09/14/04 settlement high. Link

Do you wonder why the nq04z is finding support the past 4-days around the 10/01/04 settlement of 1,456.50? Take an inverse fitted 38.2% retracement from the contract high of 1,532.50, and fit the 38.2% at the inflection low settle close from 07/26/04 and 1,378.00. See the resulting 19.1% at 1,455.25? Here's that chart. Link

Longer-term support.... is the 1,377, say 1,375. Review the above charts and look for it. Dorsey/Wright uses a 25-point box scale for their NDX.X chart. Here it is Link

  Linda Piazza   10/7/200,  10:05:37 PM
Thursday, the OEX created a bearish engulfing candle under the 200-sma on the daily chart. That looks bad for bulls and good for bears (the opposite of what I inadvertently said in my 15:54 post today!). However, the OEX ended in a potential bounce zone and tomorrow's numbers could perhaps produce that bounce. That could set up a retest of resistance. The resistance would likely first be found near 544-544.50, and those wanting new bearish entries could watch for a rollover from that level. If the OEX climbs past Thursday's mid-afternoon high at 544.79, however, want-to-be-new bears should perhaps stand aside and wait for a retest of the broken rising trendline off Tuesday's low. That trendline now crosses at about 546.40, but will be rising through the day and might soon be underneath the 200-sma again. Rollovers beneath the 200-sma and the Thursday's opening high would also be possible new bearish entries, while a push above the 200-sma and the 9/13 high would possibly make appropriate breakout bullish entries.

A special concern to those in bearish plays or considering new bearish entries is this potential formation: Link This is a continuation-form inverse H&S, and the head is way out of proportion to the shoulders, so there are several reasons to distrust this formation, but distrusting it doesn't mean I'm ignoring it. That would be ignoring bullish potential, and that's an unwise thing to do. A move above the 200-sma and 9/13 high will confirm this potential inverse H&S, setting up a potential additional 18 points of upside.

Bears want to see a quick move below 540 and the appropriate right-shoulder level, while bulls want to see the OEX steady at that 540-543 and then turn up. Bulls should be aware of the potential for this formation to be undone by a fall below the appropriate shoulder level or by another rejection at the neckline level.

What about bullish entries? I mentioned the breakout entry over the 9/13 high, but what about an entry from this potential bounce zone reached Thursday afternoon? For a while now, I've been considering bullish entries to be countertrend entries, and the downturns from the 200-sma and today's bearish engulfing candle tend to confirm that impression. I suggested near the close Thursday that those carrying bearish positions overnight and considering hedging their positions with a long do so, but that was a "just in case" hedge in case tomorrow sees blow-out numbers and a blow-out upside reaction. Such a hedge might need to be closed early tomorrow morning, depending on how futures look and how the open proceeds.

Where it gets more difficult is in looking for new bearish breakdown entries. I don't see a strong likelihood that we'll see one tomorrow, although I'll keep on the lookout. Such a breakdown entry would almost have to be to be way down at 539.50. There's much potential for a bounce from the current level down through several points, getting stronger as 539.50 is approached. Weekly Keltner channels and weekly MACD are flat-lined, not giving much sense of ultimate direction, but the historical and Keltner support in that area combine with a rising trendline off the 9/28 low, crossing at about 540, so there's still bounce potential from that level.

  OI Technical Staff   10/7/200,  10:05:26 PM
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