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  Jeff Bailey   11/8/200,  7:23:33 PM
3M (MMM) $81.38 ... last tick at $82.00 after company announced $200 million stock buyback.

  Jeff Bailey   11/8/200,  6:46:19 PM
Pivot Matrix for tomorrow at this Link

  Jeff Bailey   11/8/200,  5:05:36 PM
Closing Internals at this Link

  Jeff Bailey   11/8/200,  4:15:14 PM
Current OPEN MM Profiles at this Link

Today's activity ....

Sold one (1) of the TASR Dec. $45 calls (QUR-LI) at $11.60. Using first in/first out, this would be the sale of the call purchased on 06/30/2004 for $10.50. ($1.10, or $110.00).

Raised a stop on the remaining TASR Dec. $45 call (QUR-LI) to $8.00 in an attempt to protect current gain.

Day trade long VCampus (VCMP) at $2.25, sold near the close at $2.40. ($0.15, or +6.67%).

  Jeff Bailey   11/8/200,  4:02:13 PM
VCampus (VCMP) goes out at $2.45 +52.17. Thought they'd at least print $2.50 at the close.

  Linda Piazza   11/8/200,  3:58:21 PM
Tomorrow morning, I'm not saying anything about expectations for a "sideways" market in my OEX commentary. Maybe I jinxed it. Seriously, however, during last December-to-January's push, the OEX consolidated near this same level for several days before moving again. It could happen again.

  Jeff Bailey   11/8/200,  3:56:48 PM
Bullish day trade exit alert ... for VCampus (VCMP) $2.40 bid

  Jonathan Levinson   11/8/200,  3:52:36 PM
QQQ bears need some prints below 37.88- so far this pullback is just respecting a higher low within the day's range.

  Jeff Bailey   11/8/200,  3:48:44 PM
Bullish day trade exit set up alert .... get ready to sell some strength in VCampus (VCMP) $2.33 +44.72% at $2.50 if traded. Otherwise, raise your stops to break even.

  Linda Piazza   11/8/200,  3:45:57 PM
If the OEX ends the day anywhere near its current level, it will have produced another doji. So far in this climb off the October low, the only "pullbacks" have come in the form of doji at resistance, so we can't read too much into this, but it certainly bears watching.

  Linda Piazza   11/8/200,  3:43:03 PM
On a Keltner basis, the OEX is just doing what it's been doing all day long, stringing candles in a mostly straight line that runs between Keltner support, now near 555.85 and Keltner resistance, now near 559.47.

  Jonathan Levinson   11/8/200,  3:40:07 PM
Seeing a pickup in volume here on QQQ above 38.

  Linda Piazza   11/8/200,  3:30:12 PM
The TRAN moved to a new day's high, but hasn't quite made it above Friday's high. It came within a few cents of doing so.

  Jonathan Levinson   11/8/200,  3:23:35 PM
56M QQQ shares have traded so far, less than half of Friday's 117M. Volume is so light that it appears that even the bots are snoozing.

  Linda Piazza   11/8/200,  3:23:09 PM
The TRAN has been inching up again, but hasn't made a new day's high.

  Jonathan Levinson   11/8/200,  3:16:15 PM
A short cycle upphase has formed, but surprisingly there was no followthrough on the uptick through QQQ 38.00. There's been no net movement since 9:40AM, despite a few small-ranging moves in both directions. They're just running the close today.

  Jeff Bailey   11/8/200,  3:13:10 PM
03:00 Internals at this Link

  Linda Piazza   11/8/200,  3:10:59 PM
After breaking above the descending trendline off Friday's high, the OEX hasn't made any more upward progress than it made downward progress earlier. When I said I expected sideways to slightly down, I didn't know just how sideways "sideways" could be.

  Jeff Bailey   11/8/200,  3:03:42 PM
03:00 Market Watch at this Link

  Linda Piazza   11/8/200,  3:02:10 PM
Revisiting last Wednesday's Wrap, I see that crude is still holding above the support levels in the chart included in that Wrap. Here's an updated chart (remember that I'm 30-minutes delayed) with the original annotations from last week. Link

  Jeff Bailey   11/8/200,  2:54:05 PM
S&P Retail Index (RLX.X) 452.29 +0.53% .... session highs here.

  Jonathan Levinson   11/8/200,  2:52:48 PM
QQQ is chipping away at 38 here, with the futures within spitting distance of session highs.

  Jonathan Levinson   11/8/200,  2:48:15 PM
QQQ has flatlined with a slight uptick in volume on the last push to the current 37.97. With the market this narrowly bound and quiet, any spike in volume should be enough to set up a race to support/resistance. 37.82-38.10 remains the key range for today.

  Linda Piazza   11/8/200,  2:40:37 PM
The OEX has just been bouncing along its five-minute 100/130-ema's all day, with those averages at 556.59 and 556.17, respectively. Traders can use those MA's for a sign that the trend has changed if the OEX drops below them. Bounces from them have been uninspiring, however.

  Jeff Bailey   11/8/200,  2:34:59 PM
02:00 Internals at this Link

  Linda Piazza   11/8/200,  2:25:39 PM
I've been waiting for an attempt to move higher so that I could watch that attempt and discover whether we see bearish divergence or other signs that a deeper pullback is in order. Is this all there's going to be? Keltner channels suggest that there could be more upside, perhaps up to 558.23 or 559.24 on the OEX.

Like many others, I see signs that the OEX is due for a much deeper pullback--RSI level and CCI level on the daily chart, for example. However, at least in the case of RSI, I can also say that I've seen times when the RSI pushed to a higher high after moving above 70 and turning below it. RSI offered a warning; it took a while for that warning to be realized. I want confirmation.

  James Brown   11/8/200,  2:23:33 PM
Bulls may want to check out Cardinal Health (CAH). The stock is up 3% after being upgraded to an "out perform" this morning. Shares are breaking above resistance near $48.50 and its simple 100-dma. These are new three-month highs.

  Jonathan Levinson   11/8/200,  2:06:23 PM
The weak and short and 30 minute cycle downphases are stalling out here after a less than stellar performance. Weak downphases are often followed by strong upphases, and the current range above 37.82 could be a potential launchpad. A break above 38.10 should kick it off, while a break below 37.82 would restore these downphases and could well be directional. Look for a surge of volume to confirm whichever break comes first.

  Linda Piazza   11/8/200,  2:06:18 PM
The OEX is breaking above the top of the descending trendline off Friday's high, but like the TRAN when it first broke above an analogous trendline today, it's inching cautiously higher rather than yet making the kind of whoosh upward we'd expect on a trendline break.

  Jeff Bailey   11/8/200,  2:04:39 PM
02:00 Market Watch at this Link

  Jeff Bailey   11/8/200,  1:58:54 PM
Taser Intl. (TASR) $56.06 +20.6% Link ... starting to "shock me."

  Jonathan Levinson   11/8/200,  1:56:01 PM
This feels like an afterhours session.

  Linda Piazza   11/8/200,  1:52:30 PM
The OEX is again testing the descending trendline off Friday's high.

  Linda Piazza   11/8/200,  1:39:45 PM
The OEX tests the descending trendline off Friday's high. Of course, it didn't really have to move up to do that. It just moved sideways long enough for the trendline to come down and meet it. Careful, we're coming into the typical stop-running time of day, so it wouldn't be impossible to find markets run up above or below a trendline, only to reverse if the breakout didn't hold.

  Linda Piazza   11/8/200,  1:35:17 PM
On the Futures side of the Market Monitor, I'm seeing a lot of discussion about crude prices and whether investors are watching them as closely. I can give you the unofficial CNBC-watching survey, at least as far as it relates to discussions in the wee hours of the morning, from the other side of the pond. Now most discussions center on the U.S. dollar, and the implications of its weakness.

Don't you always wonder, though, what the big-money people are really watching while all the rest of us are glommed onto crude prices or dollar weakness or something else?

  Jonathan Levinson   11/8/200,  1:30:02 PM
I suspect that today's large repo add from the Fed might be getting absorbed by the treasury auctions taking place today. The 6-month bill auction generated a bid to cover ratio of 1.84, the 3-month a 1.89, and the 3-year has yet to be announced.

  Linda Piazza   11/8/200,  1:23:40 PM
The TRAN did confirm is H&S on its one-minute chart and has almost met the 3572.40 downside target, at 3573.78 as I type. This shows short-term weakness in the TRAN, with even short-term weakness difficult to come by on the TRAN. We're watching the TRAN because it sometimes leads other indices.

  Jonathan Levinson   11/8/200,  1:20:36 PM
By "light", volume is currently runnin at 44.63M QQQ shares against Friday's 117M volume for the day and an average daily volume of 104.918M shares.

  Linda Piazza   11/8/200,  1:19:10 PM
Advdec line continues to decline, but so does the TRIN.

  Jonathan Levinson   11/8/200,  1:13:43 PM
Volume is still very light.

  Jeff Bailey   11/8/200,  1:11:27 PM
01:07 PM Market Watch at this Link

  Linda Piazza   11/8/200,  1:11:22 PM
The SOX is negative now, below this morning's open. It's at 416.76 as I type, still above the support of the 100-ema at 409.54. Still caught between support and resistance.

  Linda Piazza   11/8/200,  1:08:33 PM
The TRAN did form a right shoulder for that potential H&S formation. (See my 12:53 post.) It's flirting with the confirmation level, but hasn't yet confirmed and may still instead reject the formation. The significance of this is that this formation's confirmation would continue a rounding down into a lower high, below Friday's high.

  Linda Piazza   11/8/200,  1:03:45 PM
Hint: if you turn to the OEX's one-minute chart, it looks as if the OEX is actually moving.

Seriously, though, this morning showed a continuation-form H&S on the OEX's one-minute chart. That formation was confirmed, but the OEX never went much of anywhere after that confirmation, certainly not meeting the downside target. That's somewhat bullish action. The OEX may be trying to form another similar formation on the one-minute chart, but that requires a continued rounding down now and then a drop below the neckline at about 556.40. (Note: began happening as I typed.) The downside target would be about 555.55, but it's difficult to ascertain whether it would have any more chance of meeting that downside target than it did of meeting the one for the previous formation.

  Linda Piazza   11/8/200,  12:53:20 PM
The TRAN may be rounding over into a lower high on its five-minute chart, just below Friday's high. That hasn't been confirmed yet, however. We've seen bearish divergence, Keltner style, with each TRAN rise since Friday's high, and that continues now, too. This time, the TRAN reached toward, but did not touch, upper Keltner resistance on the five-minute chart. I'm not certain the TRAN has completed its efforts to climb, but the one-minute chart shows a possible H&S forming, with only one shoulder and the head yet formed. We have a right shoulder left to go.

  Jonathan Levinson   11/8/200,  12:52:54 PM
QQQ is back below 7200 tick SMA support here. 1st support is 37.88, next key support is 37.82. Volume has trailed off to the point where the bars can be obscured by bare specs of lint on my screen. Until that changes, any of these moves could gap in the opposite direction in a single tick.

  Jeff Bailey   11/8/200,  12:42:41 PM
Day trade long alert .... for VCampus (VCMP) $2.25 +39.68% here, stop $2.11, target $2.75.

1st 5-minutes from $2.12 to $2.39.

  Jonathan Levinson   11/8/200,  12:36:41 PM
Nymex crude is up to 49.125, with news that shipping through the Suez Canal is halted due to a grounded oil tanker.

  Linda Piazza   11/8/200,  12:28:41 PM
I've been saying today that I expected today to be a sideways to slightly down day, and that's what we've been getting. However, perhaps I didn't clarify that I expect the sideways to slightly down action to resolve by an attempt to push higher. When it comes, that's what I will be watching closely, to see if there's a new high and a continued push toward this year's high or a lower or equal high.

All the while the OEX has been performing this sideways trick, MACD has been turning down from the 30-minute time interval on down, completing that downturn Friday on some charts and then flattening and still sloping down on the 30-minute. It's bullish for price to hold steady while oscillators cycle down. It's possible, if the bears can't drive the OEX lower, we'll get that attempt to push higher, and that attempt could come at almost any time now. Perhaps during or after a stop-running push? Just wish I knew whether the OEX might dip to the downside first before pushing higher. I wouldn't be surprised to see a quick dip down toward 555-555.25 or just a push higher without the dip.

  Linda Piazza   11/8/200,  12:16:21 PM
The TRAN drags itself laboriously upward after breaking above the top of the descending trendline in place all day Friday. It has not yet been able to move above Friday's high. The form it's taking as it climbs looks akin to a bearish rising wedge (translation: on the TRAN, that's a bullish formation!), so the climb doesn't look healthy, but prices still move higher.

  Jeff Bailey   11/8/200,  12:15:30 PM
12:00 Internals at this Link

  Linda Piazza   11/8/200,  12:13:18 PM
Looks as if Jane (Futures side) and I were having the same thoughts at the same time! (See our 12:11 posts.) You can bet lots of others are also studying these same intermarket relationships, trying to discern something that will reveal direction and finding no clarity, either.

  Linda Piazza   11/8/200,  12:11:51 PM
TRIN flat to slightly down, advdec line trying to flatten after declining most of the day, VXO spending the day oscillating around the 14.50 neckline of its inverse H&S: not a clear picture here, either.

  James Brown   11/8/200,  12:03:20 PM
Bears are not having a good day in APOL. The stock is up 4.3% following Friday's rebound.

  Jeff Bailey   11/8/200,  12:02:51 PM
12:00 Market Watch at this Link

  James Brown   11/8/200,  12:01:49 PM
Cisco Systems (CSCO) is up 3.95% to $15.00 and challenging resistance near $15.50 just one day ahead of its earnings report. Wall Street is expecting earnings of 21 cents a share due out Tuesday night.

  Jeff Bailey   11/8/200,  11:56:21 AM
Swing trade raise bullish stop alert .... for the one (1) remaining TASR Dec. $45 Call (QUR-LI) ... to $8.00.

TASR $55.19 +18.73% here.

  Linda Piazza   11/8/200,  11:47:42 AM
The OEX is still between Keltner support and Keltner resistance. That resistance on the 7-minute chart may be thinning a little, suggesting that the OEX may at least attempt a bounce.

  Jonathan Levinson   11/8/200,  11:47:42 AM
The 30 min, 60 min and short cycle oscillators are all sideways at this point, but once again this sideways move is to the benefit of the bulls as it occurred during what should have been prime time for the bears. While there's room for a directional drop on a move below 37.82, the bears have been unable to challenge that level for hours. Above 38.04, look for a volume surge to kick off an upside breakout. Bears should also be concerned about that large 11.25B overnight repo added today, as it could lead to an upside surge in the afternoon.

  Jeff Bailey   11/8/200,  11:38:10 AM
Swing trade sell/close 1 TASR call alert ... sell 1 of the TASR Dec. $45 calls (QUR-LI) at the bid of $11.60. Using first in-first out, this would be the one purchased on 06/30/2004. ($1.10, or +10.48%)

TASR $54.50 +17.2% here

  Linda Piazza   11/8/200,  11:37:01 AM
The VXO has moved above the 14.50 neckline for its inverse H&S again.

  Linda Piazza   11/8/200,  11:34:59 AM
The OEX is still trading between Keltner support and Keltner resistance on the five and seven-minute charts. The advdec line still heads lower, which should be troublesome to anyone in a bullish trade, but other information gives a more mixed picture.

  Jonathan Levinson   11/8/200,  11:33:51 AM
Session high for Nymex crude at 49.55, -.05 for the day.

  Linda Piazza   11/8/200,  11:22:36 AM
Here are new benchmarks to watch on the OEX, with the blue 100-ema and purple 130-ema congruent with the bottom support of the new symmetrical triangle on the OEX's five-minute chart: Link Bullish above and bearish below those averages might be one way to measure action, but anyone entering a play today in either direction should be aware of the possibility of being whipsawed or else having option price deflate while the indices trade sideways.

  Jonathan Levinson   11/8/200,  11:22:12 AM
Nymex crude is bouncing from support at the 48.625 low, currently trading 49.225. I'm reading articles discussing YUKOS, Nigeria, rising Chinese demand, but the bottom line is that 48-49 is a solid confluence support zone until broken.

  Linda Piazza   11/8/200,  11:15:43 AM
The advdec line keeps sinking, at -1055 as I type. That's not bullish, so if the advdec line is leading the markets anywhere, it's leading down. I'm still thinking that neither bulls nor bears will profit much in the current environment, though, with a mixture of indications but that could change this afternoon.

  Linda Piazza   11/8/200,  11:13:25 AM
The VXO finally followed the other volatility indices and fell. It's back below the neckline of its inverse H&S, at about 14.50, with the VXO at 14.16 as I type. So far, this market action is still following the sideways-to-slightly down day pattern that I expected to see, but the TRAN may be trying to front-run a push higher for the other indices, seeing if it can stick. If the move down didn't work, it wouldn't be unusual for big-money people to try a run up and see if it sticks. I'm still thinking choppy, but if we see new highs, that could change.

  Linda Piazza   11/8/200,  11:05:55 AM
At 419.50 as I type, the SOX pauses beneath the top of trendline of its rising wedge and the 200-ema, with that average at 426.05. The SOX has not topped Friday's high. It's got support beneath that the 100-ema at 409.59, so it's between support and resistance.

  Jonathan Levinson   11/8/200,  11:04:41 AM
Dec. gold has recovered part of its earlier decline, now down 1.1 to 433.20, with silver up .014 to 7.519. HUI is down .64% to 236.82, XAU -.07% to 106.79.

  Linda Piazza   11/8/200,  11:02:55 AM
Our the last few minutes, the TRAN has been attempting an upside break out of the triangle it's been building at the top of its climb. The TRAN hasn't made any more progress to the upside, however, than the OEX made to the downside.

  Jeff Bailey   11/8/200,  11:01:08 AM
Taser Intl. (TASR) $53.65 +15% .... edges above near-term "zone of resistance" from $50.97-$53.16.

  Jeff Bailey   11/8/200,  10:58:58 AM
10:55 Market Watch at this Link

  Jonathan Levinson   11/8/200,  10:57:30 AM
QQQ chipping away at 38.00 resistance now. The short cycle downphase has stalled.

  Linda Piazza   11/8/200,  10:53:06 AM
I always distrust a breakdown below a trendline when that breakdown results in sideways trade. That's what's happening now on the OEX. On a Keltner basis, the OEX is between Keltner support near 554.50 and Keltenr resistance near 559, with MACD flat and not giving help as to eventual direction.

  Jeff Bailey   11/8/200,  10:52:24 AM
Taser Intl. (TASR) $52.65 +13.25% ... probing WEEKLY R2 ($52.42).

  Linda Piazza   11/8/200,  10:48:40 AM
Still sideways.

  Jeff Bailey   11/8/200,  10:43:45 AM
Pfizer (PFE) $27.96 -2.88% Link ... lower after Friday's disclosure that it received a letter from NY Attorney General requesting documents and information related to clinical trials for indications other than those approved by the FDA. Also disclosed it received similar letter from Connecticut Attorney General regarding its Zoloft drug.

  Linda Piazza   11/8/200,  10:40:52 AM
More sideways. I'm caught on the phone, but still watching.

  Jonathan Levinson   11/8/200,  10:38:23 AM
Nymex crude is down 1.86% at 48.65, a session low. But QQQ can't stay north of 37.96 for longer than a few seconds. The short cycle downphase getting very poor traction, however, and bears are going to have to do a lot better than this to avoid another rocket ride higher on the next upphase when it comes around.

  Jeff Bailey   11/8/200,  10:29:42 AM
Taser Intl. Call option stop alert update

I want to have one (1) of the call options with a stop at TASR $48.50.

I want to have another (1) stop on the call options bought on 10/25/04 at $6.00.

I will update both of these in my MM profile tracker.

  Jeff Bailey   11/8/200,  10:25:38 AM
10:00 Internals at this Link

  Jonathan Levinson   11/8/200,  10:24:59 AM
QQQ had bounced at 37.82 support and rolled over below 37.96, but in a range this narrow a single tick could generate a breakout. Look for a move below 37.82 to confirm a directional move lower, while bulls need to clear 37.96, 38.00 and then the session high at 38.10 to reignite the 30 min cycle upphase.

  Jeff Bailey   11/8/200,  10:21:11 AM
Current OPEN MM Profiles at this Link

  Linda Piazza   11/8/200,  10:20:36 AM
The VXO has held above that neckline level, but the VIX and VXN both turned tail, with the VXN now below Friday's low. I haven't watched the VXN enough to know whether this morning's low is low enough to be bearish from a contrarian point of view.

What do you say, Jonathan?

  Jonathan Levinson   11/8/200,  10:18:14 AM
Look for a lower high on this bounce at or below 38 to confirm the new short cycle downphase that has just kicked off.

  Jonathan Levinson   11/8/200,  10:09:58 AM
QQQ is breaking 7200-tick SMA support after a weak bounce just now, currently down to 37.87. The short cycle oscillators are trying to launch a downphase here- a move below 37.82 should do it. The 30 min cycle channel still points up, but is stalling in its upphase on the pullback.

  Jonathan Levinson   11/8/200,  10:05:38 AM
The Fed's open market desk has ponied up a whopping 11.25B overnight repo to replace the large 7B expiring for a net add of 4.25B for the day.

  Linda Piazza   11/8/200,  10:04:51 AM
After the first retracement of the day, which didn't produce much in the way of gains for the OEX, it's again testing and slipping just beneath that rising trendline off the last five-minute low of 11/02. It's moving down into that Friday morning gap, with the top of the gap at about 556.29 and the bottom at about 555.42, and with the Friday low at 554.72. That's a lot of potential support to chop through today. My view for today is for sideways-to-lower, perhaps setting up a bigger retreat to come, but I'm not sure that bigger retreat is coming just yet. VXO does suggest something is underway. CCI has turned down below 200 again, RSI hooks down, but RSI is fickle, and might turn right back up and pretend it had never turned down at all. I'm keeping my eye on everything, but I still worried that bulls won't just give up and hurting bears might take the first opportunity get out, making today a choppy day. History suggests this is the appropriate stopping place for a sideways to slightly down correction, too, because this rise is mimicking that in mid-December-to-January, and this is right where markets stopped to take a breather before shooting higher then, too.

Those who are afraid that this is "the" correction beginning and who want to step into bearish plays on that trendline break should be aware of the possibility that the OEX might not go much of anywhere to the downside. Those who don't should be aware that they might be missing that first chunk of the downside before they get their wanted confirmation. Tough choice. I'm on the wait-it-out side for all but scalpers, though.

  Jeff Bailey   11/8/200,  10:04:08 AM
10:00 Market Watch at this Link

  Jonathan Levinson   11/8/200,  10:01:51 AM
7200-tick SMA support being tested right here for QQQ and NQ. It's already been broken on ES futures.

  Jeff Bailey   11/8/200,  10:01:30 AM
Swing trade long alert Taking one (1) of the iShare Russ. 2000 Growth (IWO) Link May $63 Calls (IWO-EK) at the offer of $4.40 ($4.10 x $4.40)

IWO $62.39 here.

  Jonathan Levinson   11/8/200,  9:58:29 AM
7200 tick SMA support is at 37.89 QQQ, below which the 30 min cycle channel should begin to stall. Lower 30 min channel support is up to 37.77.

  Jonathan Levinson   11/8/200,  9:54:55 AM
QQQ is following bonds back down, now testing the 37.94-.96 level noted earlier.

  Jonathan Levinson   11/8/200,  9:54:03 AM
Session low for ZN bond futures, TNX up 3.4 bps at 4.22% here.

  Jeff Bailey   11/8/200,  9:54:00 AM
VIX.X 14.39 +3.97% .... Daily Pivot levels .... 13.12, 13.49, Pivot = 13.79 14.16, 14.46.

  James Brown   11/8/200,  9:53:15 AM
The very overbought Polaris Industries (PII) is down 4% to $62.99 after being downgraded to a "sell" this morning by BAC.

Shares closed just under $66 on Friday, which is above the median analyst price target at $62.

  James Brown   11/8/200,  9:51:36 AM
ELBO is up 9% to $39.95 this morning after raising earnings guidance for both its Q3 and Q4 results. Shares are hitting new two-year highs.

  Linda Piazza   11/8/200,  9:51:22 AM
The advdec line has climbed--all the way up to a wildly enthusiastic +123 issues! So far, nothing much to see from that, except that there isn't a wildly enthusiastic buying spree going on.

  Jonathan Levinson   11/8/200,  9:49:52 AM
Look for higher QQQ support at 37.94-.96 on any pullback.

  Jeff Bailey   11/8/200,  9:49:21 AM
Swing trade place partial position stop alert .... let's place a stop on one (1) of the TASR Dec. $45 calls (QUR-LI) should the stock itselft trade $48.50.

TASR $50.35 +8.19% here.

  James Brown   11/8/200,  9:49:21 AM
Troubled insurer Marsh McLennan Co (MMC) is due to report earnings tomorrow. While earnings may not be so important their guidance will be and any reaction to the Spitzer investigation.

Speculators may want to consider the following strategy. MMC has coiled into a VERY narrow range near $27.50. One could buy the November $30 call for 25 cents and the November $25 put for 25 cents and if MMC produces a big move either way it could be a winner.

  Jonathan Levinson   11/8/200,  9:48:12 AM
Gold is down 1.90 at 432.40, HUI -.85% at 236.33 currently. Bonds remain weak, TNX +2.8 bps at 4.214%.

  Linda Piazza   11/8/200,  9:45:23 AM
VXO inverse H&S and neckline: Link

  James Brown   11/8/200,  9:44:06 AM
U.S.Steel (X) is up 4.7% to $42.26 and gapping above resistance at $42.00. These are new six-year highs for shares of X. Looks like there were positive comments on the steel industry in Barron's over the weekend.

  Linda Piazza   11/8/200,  9:43:51 AM
Careful, bulls. The VXO just jumped above the neckline for its inverse H&S on its 10-minute chart, neckline at about 14.50.

  Jonathan Levinson   11/8/200,  9:43:38 AM
Here comes that uptick in the 30 minute cycle channel. Resistance has climbed to 38.10 QQQ.

  Linda Piazza   11/8/200,  9:41:23 AM
The OEX again slips below that ascending trendline. It's also below a shorter-term ascending trendline that formed Friday. I continue to be worried about a more sideways than down correction this morning, however, with possible Keltner support trying to firm near 555-556. The 15-minute MACD has been turning down since Friday morning, with the only result being a sideways correction.

  James Brown   11/8/200,  9:41:12 AM
Traders were quick to buy the dip in IBM this morning. Shares bounced from $92.50 just after the open.

  Jonathan Levinson   11/8/200,  9:39:32 AM
QQQ is below its premarket lows, heading for a test of rising 7200 tick SMA support here.

  Jonathan Levinson   11/8/200,  9:37:59 AM
MSFT seems to be holding down the NQ and QQQ this morning in the wake of its antitrust news regarding Netware and, allegedly on the horizon, Wordperfect office suite.

  Linda Piazza   11/8/200,  9:37:03 AM
The OEX is slipping slightly below the trendline off the last 11/02 five-minute low, but let's see what happens during the first retracement of the day, due to begin in seven or eight minutes. No, we don't have to wait. The OEX is already bouncing back into the triangle formed Friday and back above that trendline. Today may be a really difficult day to gauge. Markets may want to go down, but shorts are going to be jittery, anxious to cover, and bulls aren't going to give up easily.

  Linda Piazza   11/8/200,  9:31:01 AM
The OEX opens and heads down to test that ascending trendline off the last 11/02 late-afternoon low.

  Linda Piazza   11/8/200,  9:28:36 AM
Friday afternoon, the indices tended to drift sideways rather than mount a real retreat and that's what they did in the overnight sessions, too. We have dollar weakness worrying overseas markets, with their exporters suffering on prospects of an unfavorable exchange rate, but during 2003, we saw some periods with our markets rallying on dollar weakness due to the favorable rates offered to our multinational companies. This time, there's a difference, however, with some economists in Europe and Asia theorizing that the firming in their currencies will help them deal with higher oil prices. Will our markets feel more of an impact from crude prices, then? While crude prices have retreated, they haven't retreated too far or soon enough to keep some companies from reporting on the impact that higher crude has had on their earnings. I'm far from an expert in any of this and am just trying to sort through the various ramifications, representing those of you out there who are self-taught and still learning.

I posted my thoughts on the OEX in my 22:56 post last night. Those thoughts haven't changed much with overnight action, but as I study charts this morning, I'm again reminded of that high daily RSI and the high CCI level, too, indicating overbought conditions. I think the rally is living on borrowed time until there is either a sideways consolidation or a pullback to work off those overbought conditions, but the futures action overnight lends me to believe that today, at least, would be more of a choppy, sideways/down kind of day than a deep pullback. Let's see what TRIN and advdec and other measures show us as the market opens, however.

  Jonathan Levinson   11/8/200,  9:24:08 AM
The 30 min cycle for QQQ is drifting sideways-up, with resistance currently at 38.07 on both the 30 and 60 min channel tops. If bulls can hold the price over 38 for longer than 10 minutes, we should see the channels shift more decisively upward. 7200 tick SMA support is below at 37.84, below which channel support should settle at 37.60.

  Jeff Bailey   11/8/200,  8:52:39 AM
Taser Intl. (TASR) $46.49 .... #3 most active at $49.10. Tranportation Security Admin. approves TASER devices for use on aircraft.

  Jeff Bailey   11/8/200,  8:51:57 AM
Novell (NOVL) $6.86 .... quick jump to most active at $7.60.

  Jonathan Levinson   11/8/200,  8:35:34 AM
The US Dollar Index (cash basis) is testing the 84 level from below after bottoming at 83.75 overnight. Link

  Jonathan Levinson   11/8/200,  8:04:53 AM
Equities are lower, ES trading 1164.50, NQ 1529, YM 10365 and QQQ -.03 to 37.95. Gold is down 40 cents to 433.90, silver -.025 to 7.48, ten year notes at a session low of 112.25 and Nymex crude -.65 to 48.95.

There are no major economic reports scheduled for release today.

  Linda Piazza   11/8/200,  7:01:03 AM
Good morning. Performances in the global bourses proved mixed in the overnight session, but exporters around the globe have been pressured by the dollar's weakness. The dollar was reaching new recent lows against many currencies. Our futures have drifted slightly lower during the overnight session. As of 6:53 EST, gold was down $0.80 and crude, down $0.54 to $49.07. More detail about Asian and European markets follows in succeeding paragraphs.

Monday morning, the Nikkei opened just below 11,100, but then tumbled quickly into negative territory and kept tumbling all day. The Nikkei closed just off its low of the day, down 77.94 points or 0.70%, at 10,983.83. During the overnight session, the dollar fell to a six-month low against the yen. The dollar's weakness against the yen pressured exporters, but investors were also wary ahead of Friday's Japanese GDP for the just-concluded quarter. Most auto makers declined. Mitsubishi's earnings announcement was due in the afternoon, with the automaker dropping ahead of that announcement. When that earnings announcement came, Mitsubishi Motors reported a widening first half loss from the year-ago level, and also lowered its sales and net loss forecast for the full year. Honda had gained early in the session on speculation about its expansion plans into China, but lost those gains to close lower by 0.6%.

Other Asian markets turned in mixed performances. The Taiwan Weighted gained 0.10%, but South Korea's investors were also worried about the dollar's weakness against their currency. The Kospi dropped 1.69%. Singapore's Straits Times fell 0.29%, but Hong Kong's Hang Seng gained 0.66%. China's Shanghai Composite declined 0.07%, with the bourse trying to steady above 1,300.

Currently, European bourses turn in mixed performances, with many trading near the flat-line level. Investors share the concern of Asian markets, as the dollar reached record lows against the euro. All night, television commentators discussed the implications of the weakening dollar on foreign markets.

Individual stocks reacted to news or earnings announcements. German reinsurer Munich Re rose after an earnings announcement that beat expectations for third-quarter profit but that included a lowered 2004 profit forecast. France Telecom declined after announcing plans to sell its position in Tower Participations, with a portion of the gains to be returned to shareholders. In the U.K., BT Group announced its attention to buy Infonet (IN), and was trading down as often happens with the acquiring company. British Airways eased after its earnings announcement and its statement that it would not pay a dividend. Airlines throughout Europe had been reacting to announcements of October passenger load information. Elan (ELN) released one-year data of its Phase III trial of its multiple sclerosis drug, and rose by more than 10% at one point this morning.

As of 6:53 EST, the FTSE was down 11.60 points or 0.24%, to 4,728.20. The CAC was up 2.04 points or 0.05%, to 3,783.03. The DAX was up 9.94 points or 0.24%, to 4,073.52.

  Linda Piazza   11/7/200,  10:56:12 PM
Higher daily low on the OEX, confirmed by a higher daily high: downtrend banished. Those two suggest that it's time to switch to a buy-the-dips tactic rather than a sell-the-rallies one. Daily RSI levels--at overbought levels seen only twice this year--suggest that we'd certainly better remain aware that the current rally could end. The previous two times the 9-period daily RSI was above 70, it eventually tumbled, but neither time did it immediately tumble. Ride the upward trend while the OEX rises, but be ready for a reversal when it occurs.

When the OEX began moving up from the 522 level in early December, 2003, it climbed straight into the 563 level before it pulled back even minimally, and then moved up to a new high before it began the almost-year-long retreat. The OEX appears to be repeating that same pattern from early December of last year, so we have to be aware that although the OEX looks overbought according to RSI and other measures, we have last year's example to show us that it can continue to climb and become even more overbought. Interestingly, that period that began last December was one of the only two other periods in a year when RSI has measured above 70. During that period, the RSI hit 70 when the OEX was at about 535. The OEX climbed from the 535 level when RSI first hit 70 until its eventual 573.44 high before beginning that tumble. Sure wouldn't have wanted to use RSI-above-70 as a market-timing tool, although it did provide a warning.

So did a reversal begin Friday? There's no evidence yet that it did. For those of you who follow CCI, daily CCI levels also indicate overbought conditions with CCI measuring 216.33, but CCI has not yet turned down, either. We should be on the watch for a downturn below 70 on the RSI and for a CCI downturn, too. Watch VXO, too, with the VXO perhaps trying to form an inverse H&S on its intraday charts. Until we see some of these signs confirm a potential reversal, we shouldn't jump too readily on the bearish side of the camp.

However, it's possible that the OEX did begin at least a pullback or consolidation, interestingly in the same area in which it began a small pullback early this year, during the December-to-January rally. If it did, the 38.2% retracement of the current rally lies at about 545.60, near the 200-sma at 546.06. The 50% retracement is at 541.07, near the 540-541 S/R zone, but I rather suspect that on first retreat, the OEX may never get that far, but may attempt to find support instead either near 554.75 or near 550. Those numbers are drawn from Keltner evidence and from the location of the OEX 15-minute 100/130-ema's, at 550.88 and 549.07, respectively.

The OEX's three-, five-, and seven-minute charts showed bearish divergence, Keltner style, all day Friday. A decline below the rising trendline off the 11/02 high, with that trendline currently at about 556.80, may be a sign that the pullback or sideways consolidation is beginning. For the time being, until we get more confirmation that the overbought conditions are predicting an imminent rather than sometime-in-the-future reversal, any bearish plays should be considered countertrend plays. Traders should expect choppy trading conditions and should consider the possibility that reversals might appear to get started, only to go nowhere. A move to a new high Monday would be a rejection of even a minimal pullback or consolidation.

  OI Technical Staff   11/7/200,  10:56:04 PM
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