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  OI Technical Staff   12/30/20,  11:49:23 PM

Click here for bonus info: Link

 
 
  Linda Piazza   12/30/20,  7:33:07 PM
A strong end-of-day sell-off plunged the OEX below its five-minute 100/130-ema's, all the way to mid-channel support on the 15-minute Keltner channels. That plunge also sent the OEX back to retest a descending trendline off the 11/27 high, a trendline it had broken through early in the morning. Near mid-morning, I questioned whether indices might not be near their high of the day, and they were. We saw the chop I expected to see the rest of the day until that last 15 minutes. The downdraft brought the SOX back below its 200-sma after punching through it earlier in the day, a pattern that was seen earlier in December, too. The TRAN, as expected, printed another doji after yesterday's. Other indices mustered a little more strength, such as the GHA, GSO, and RLX, although they, too, face resistance of their own and aren't yet in the clear.

Now what? That mid-channel Keltner level might provide a bounce tomorrow if the OEX opens above it. If the OEX should gap below it, say below 575.80, it then looks vulnerable to the midline of its rising regression channel, at about 573 currently. If the OEX bounces, we'll look at possibilities for rollovers, but any plays remains risky this week in the low-volume environment.

 
 
  Jeff Bailey   12/30/20,  5:30:00 PM
Pivot Matrix for tomorrow at this Link

 
 
  Jeff Bailey   12/30/20,  4:53:40 PM
Closing Internals at this Link

 
 
  Jeff Bailey   12/30/20,  4:21:11 PM
Current OPEN MM Profiles at this Link

Today's Activity ...

Swing trade long 1/2 bullish in shares of Peregrine Pharma (PPHM) at the offer of $1.16, stop $1.10, targeting $1.39

Swing trade bullish call for 1/2 bullish position in the CD May $25 Calls (CD-EE) at the offer of $0.75. No stop, targeting $27.

 
 
  Jeff Bailey   12/30/20,  4:09:30 PM
Sell Program Premium ... DIA 107.81 , SPY 121.09

 
 
  Linda Piazza   12/30/20,  4:00:11 PM
True to its often-seen pattern, the TRAN printed another doji after yesterday's doji following a tall white candle. If the TRAN stays true to form, there may be another day or two of doji or small-bodied candles or even a true decline.

 
 
  Linda Piazza   12/30/20,  3:58:01 PM
Really will be touch and go with the SOX with respect to its 200-sma. It's at 431.72 as I type, with the 200-sma at 431.49.

 
 
  Jeff Bailey   12/30/20,  3:53:25 PM
Russell 2000 Growth iShares (IWO) ... going for a third-straight close of $67.74.

 
 
  Jeff Bailey   12/30/20,  3:50:21 PM
VIX.X 12.40 +6.79% ... another obscure day for the VIX.X.

Most actives today are the SPX Mar. 1,025 puts 14,350 : 66,398

SPX Mar. 1,200 calls 11,183 : 38,593

SPX Dec. 850 puts 11,001 : 61,939

Current March Max Pain for the SPX is 1,175

 
 
  Linda Piazza   12/30/20,  3:48:16 PM
In my 10:25 post, I wondered if indices weren't sitting somewhere near their highs of the day and if we wouldn't see chop the rest of the day. Many were near their highs, as it turned out. Even the RLX, having just reached a new high of the day, really isn't much above that 10:25 level.

 
 
  Linda Piazza   12/30/20,  3:44:55 PM
Will the SOX make it with a close above the 200-sma? I bet there are efforts to make sure that happens, but it's going to be touch and go with the SOX only a little more than a point above that average.

 
 
  Jeff Bailey   12/30/20,  3:43:16 PM
3M (MMM) $83.00 +0.28% ...

 
 
  Linda Piazza   12/30/20,  3:42:29 PM
A few minutes ago, the Dow slipped back below its five-minute 100/130-ema's. It's moved back above them now, but as I mentioned earlier today, the Dow had already begun showing some weakness with respect to these averages, in that its bounces from them were getting tamped down, topping out at lower highs. Market bulls don't want to see it roll down below them again, but we have that expected support at 10,800 if they do. When studying Keltner lines on the 15-minute chart, I note that the Dow's bounces from the mid-channel basis line are also getting tamped down. Some bearish divergence is showing up there, so that I'm not so sure that the mid-channel support, now from 10,806-10,816, is going to continue to hold. The Dow showed the same characteristics December 17-20 and then broke higher anyway on the 21st, so bearish divergence is just a potential warning sign and nothing more. Still, it's there.

 
 
  Jeff Bailey   12/30/20,  3:42:21 PM
20 minutes to get the OEX up to its WEEKLY R1 of 580.18. That still wouldn't be enough to get a DAILY R2 of 584 for tomorrow though.

 
 
  Linda Piazza   12/30/20,  3:31:52 PM
Those who bought the OEX today on an inside-day breakout haven't yet gotten much for their efforts. Perhaps the reason I distrust them is because I'm mostly watching them on the OEX and this isn't an unusual occurrence.

 
 
  Linda Piazza   12/30/20,  3:26:08 PM
The DRG, the pharmaceutical index, does battle with its 200-sma today, too. The SOX isn't alone. The DRG has been climbing off October's low in a rising regression channel that's bringing the DRG up into 320-324 horizontal resistance. Near the top of that horizontal band or perhaps slightly above it, the DRG will face a descending trendline off the October 2000 high. Another, lower trendline suggested a neckline for an inverse H&S with a declining neckline. The DRG broke through that about this time last year, but it's been dropping along the neckline ever since. That's a looong bull flag, if that was supposed to be what it was, and it managed to finish forming a head (right after its breakout) and potential right-shoulderish formation (current rise) on that weekly chart, with that formation conflicting with the already confirmed inverse one. To me, it looks as if there was some hesitancy (a year's worth) after that confirmation and I don't think we can necessarily count on the upside target being met any longer. Still, a break over that last descending trendline off the October 2000 low would be a start at looking more bullish. I continue to have some concerns as long as the DRG is below the 200-week sma, however, with that at 335.53, and for now, all we can note for certain is the the DRG has been in a year-long descending regression channel.

 
 
  Jeff Bailey   12/30/20,  3:12:40 PM
03:00 Internals at this Link

 
 
  Linda Piazza   12/30/20,  3:05:29 PM
The RLX continues to skip along the top of the three-minute 100/130-ema's, coming down again to retest them midday and then climbing again. The OEX climbed after yesterday's late-day climb above its five-minute versions, although the climb hasn't exactly been stellar. I noted yesterday that the Dow seldom spent more than a day trading below its five-minute versions and today it did manage to stay above them most of the day, but each bounce from them today seems a little less vigorous, as if it's already losing strength again. The TRAN has shown little vigor with respect to these averages today, too, actually sinking below them to test 3800 earlier in the day. Most indices hold up with respect to these averages, but they're not showing great vigor, either.

 
 
  Jeff Bailey   12/30/20,  3:03:40 PM
03:00 Market Watch at this Link

 
 
  Linda Piazza   12/30/20,  2:54:35 PM
The RLX, a leading index lately, is zipping up toward its 11/15 high of 465.07, with the RLX at 464.17 as I type. As well as being a potential breakout point, this is likely resistance. The RLX already has a rounding cup formation, and it's possible that it's going to need a handle to go with that cup, so it wouldn't be unexpected to see it pull back for a few days to retest the trendline it broke through and recharge itself before going much higher than that November high. That may depend on what happens after it pokes over the lip of that cup formation. A pullback that's too deep or too prolonged will begin to suggest a double-top formation.

 
 
  Linda Piazza   12/30/20,  2:43:25 PM
The OEX is jammed up against Keltner resistance again on the 15-minute chart. That resistance looks tougher than the immediate support, so the OEX is going to need to exhibit more strength than it has so far today to shove much higher than the day's high.

 
 
  Jeff Bailey   12/30/20,  2:42:53 PM
UQM Tech (AMEX:UQM) $2.60 +18.72% ... another one on Jim's list? Coloradans will know this one. Not sure if Lee Iococca still a majority shareholder or not.

Used to be called Unique Mobility

 
 
  Linda Piazza   12/30/20,  2:39:32 PM
Would have been nice to grab a few thousand shares of NVR back last June, right, James? (See James' 14:34 post.)

 
 
  Jeff Bailey   12/30/20,  2:37:23 PM
Yak Comm. (YAKC) $7.55 +22.95% ... chew'n them up and spit'n em out. Link (using Mark's Mutley from yesterday)

See these 21-day, 50-day and 200-day SMA's?

Link , Link , Link

 
 
  Jim Brown   12/30/20,  2:35:15 PM
With the volume on the NYSE only 700 mil and the Nasdaq barely over a billion this suggests tomorrows volume is going to be really bad. It should offer those fund managers a prime opportunity to paint the tape for the year end close without much effort.

 
 
  James Brown   12/30/20,  2:34:38 PM
Whoa! One stock in desperate need of a stock split is builder NVR. Shares are up $315 to $765 since July.

 
 
  Linda Piazza   12/30/20,  2:29:58 PM
That little run higher was reversed. The possibility of an OEX intraday double-top exists, to be confirmed on a drop below 576.83. Today, few chart developments are being fulfilled, however. Just lots of aimless wandering.

 
 
  Jim Brown   12/30/20,  2:29:51 PM
Jim Rodgers in an interview on CNBC echoed my sentiments on my Oil Crisis report. England, despite the big discoveries in the North Sea will be a net oil importer within two years. The oil in the North Sea is already gone in most cases and the rigs are being shut down. There is a big furor now in England because the operators want to just sink them instead of dismantle/move them. Billions of dollars of equipment now worthless. They estimate $50-$75 million each for the big ones to dismantle them instead of sink them in place.

Bottom line, the field is drying up and there is not any new field to move them to. Oil is going up, way up, very soon. Those in the right stocks will make a lot of money.

 
 
  Linda Piazza   12/30/20,  2:22:58 PM
The TRAN has been climbing as the advdec line did, but the TRAN threatens to rollover below the HOD.

 
 
  Jeff Bailey   12/30/20,  2:20:17 PM
Current OPEN MM Profiles at this Link

 
 
  James Brown   12/30/20,  2:12:26 PM
EBAY has shown some strength the last three sessions and is trying to breakout over the $118 level. Its MACD is nearing a new buy signal soon.

 
 
  Jeff Bailey   12/30/20,  2:12:14 PM
02:00 Internals at this Link

 
 
  Linda Piazza   12/30/20,  2:09:29 PM
The SOX still has suspicious difficulty getting too far above that 200-sma.

 
 
  Jeff Bailey   12/30/20,  2:03:21 PM
02:00 Market Watch at this Link

 
 
  Linda Piazza   12/30/20,  2:00:28 PM
The advdec line has been climbing since shortly before noon and is now at the HOD.

 
 
  James Brown   12/30/20,  1:54:07 PM
OI call play IBM is up 0.7% and within 2 cents of our target at $99. We will exit at $99.00.

 
 
  James Brown   12/30/20,  1:53:02 PM
OI call play GOOG is up another $3 to $195.77 and breaking out from its recent three-day consolidation.

 
 
  James Brown   12/30/20,  1:52:07 PM
OI call play FRE is also trading near all-time highs today up 0.7%.

 
 
  Linda Piazza   12/30/20,  1:52:00 PM
That move came courtesy of a currency move or else they both occurred in tandem. We're right in stop-running time on the markets, though, so be careful about making suppositions.

 
 
  James Brown   12/30/20,  1:51:14 PM
OI call play ETR is breaking out over resistance at $68 to hit new all-time highs.

 
 
  Linda Piazza   12/30/20,  1:49:41 PM
The dollar is making a move again, weakening against the yen and euro. Any other week, I'd say that might get equities moving one direction or another, but they seem stuck . . . oh, here goes the OEX climbing as I type.

 
 
  Linda Piazza   12/30/20,  1:48:52 PM
The OEX did break out of that one-minute channel I mentioned earlier in my 13:12 post. It hit the upper Keltner trendline, but it had pushed that trendline a little higher than the 577.50-ish upside target by the time it got there. Now the OEX hits 577.40-ish support and bounces up to test resistance again, but looks vulnerable to 577.30 or so unless it can show one minute closes above the Keltner line currently at 577.51. Beyond that, it's just impossible to say much about what the OEX might do.

 
 
  Mark Davis   12/30/20,  1:46:58 PM
It's a rare day to see the OEX leading the pack isn't it Linda? Flight to safety?

 
 
  Linda Piazza   12/30/20,  1:36:23 PM
The TRAN fell to just below 3800 about mid-morning and then began climbing. It's just inched above a 50% retracement of the day's range. Market bulls want to see the TRAN reach a new high of the day. I'm not expecting to see big gains on the TRAN today, however, so wouldn't expect it to move much above the HOD.

 
 
  Jeff Bailey   12/30/20,  1:14:23 PM
01:00 Internals at this Link

 
 
  Linda Piazza   12/30/20,  1:12:29 PM
I've had to dial down to a one-minute OEX Keltner chart to see any "action," and even there, there isn't much. The OEX bumbles between lines defining a channel about $0.25 wide. It looks as if the OEX should break out of that channel soon, but shortest term targets are only 577.53 on the upside and 576.80 on the downside, with those targets predicted by Keltner channels but roughly matching the targets you'd expect from a rectangular pattern breakout of this width rectangle.

 
 
  Jeff Bailey   12/30/20,  1:06:19 PM
01:00 Market Watch at this Link

 
 
  Linda Piazza   12/30/20,  12:55:03 PM
The SOX comes back to test the 200-sma, with the SOX at 431.67 as I type and the 200-sma at 431.49.

 
 
  Linda Piazza   12/30/20,  12:52:59 PM
The advdec line climbs again.

 
 
  Linda Piazza   12/30/20,  12:47:48 PM
So far, the TRAN still has a doji as a daily candle.

 
 
  Linda Piazza   12/30/20,  12:44:19 PM
The RLX isn't showing much leadership so far today. It punched higher but is now only about $0.60 above yesterday's close, having fallen back a bit from the HOD. That HOD was under the 11/15 high of 465.07.

 
 
  Jeff Bailey   12/30/20,  12:41:57 PM
Swing trade bullish call alert for 1/2 bullish position (three) in the Cendant (CD) $23.31 +1.79% ... CD May $25 Calls (CD-EE) at the offer of $0.75.

Disclosure : I do currently own an investment stake in several real estate developments (via limited partnership), that Cendant Corp. (CD) also has an investment stake in.

 
 
  Linda Piazza   12/30/20,  12:38:27 PM
For more than an hour, the OEX has traded in a $0.25 rectangular trading range. Rectangular ranges allow us to set targets. When the OEX breaks to the upside or downside, we can expect a target . . . $0.25 away from the breakout point.

 
 
  Jeff Bailey   12/30/20,  12:35:29 PM
Cendant (CD) $23.30 +1.79% Link ... another failed head/shoulder top pattern (head $23.50, neckline $22)?

Bears now faced with a much larger reverse head/shoulder (head $20, neckline $23)?

Up just a little from January, so may not be subject to tax-gain selling in January.

 
 
  Jeff Bailey   12/30/20,  12:33:22 PM
Steel stocks ... AKS $14.18 -10.47% and ZEUS $26.29 -9.53% ... percentage losers after Wall Street Journal suggested that China may once again become a net exporter of steel.

 
 
  Jeff Bailey   12/30/20,  12:30:20 PM
Torch Offshore (TORC) $1.15 -27.67% ... one of the few NASDAQ-listed stocks getting "torched" and a new 52-week low.

 
 
  Jeff Bailey   12/30/20,  12:28:54 PM
Evergreen Solar (ESLR) $4.55 +11.79% ... wonder if this one is on Jim Brown's list.

 
 
  Linda Piazza   12/30/20,  12:28:18 PM
I have to step away for about ten minutes.

 
 
  Linda Piazza   12/30/20,  12:27:51 PM
The SOX is less than a point above its 200-sma now.

 
 
  Jeff Bailey   12/30/20,  12:22:25 PM
Phazar-ians? .... Phazar Corp. (ANTP) $52.07 +15.8% Link

 
 
  Linda Piazza   12/30/20,  12:18:38 PM
The OEX comes back toward the 577 level, but I think the H&S on the OEX's five-minute chart fizzled out. Typical for a day like today. The right shoulder elongated with the bears unable to confirm the formation, and the OEX trades between what would have been the neckline and what would have been the right shoulder. Most of the day's trading has held above 577.00 resistance turned support, however, something else in the bulls' corner, but the current test of 566.90-577 should be watched.

 
 
  Jeff Bailey   12/30/20,  12:15:42 PM
12:00 Internals at this Link

 
 
  Linda Piazza   12/30/20,  12:06:23 PM
For those watching only the options side of the Monitor, check Keene's 12:03 post on the futures side for a holiday schedule.

 
 
  Jeff Bailey   12/30/20,  12:04:36 PM
12:00 Market Watch at this Link

 
 
  Linda Piazza   12/30/20,  11:58:00 AM
The OEX is taking that run higher toward the top of a possible right shoulder that I thought it would take. The attempted neckline break was bought, so this was expected. Let's see if approaches to 577.50 are sold. That right shoulder is getting a little elongated, though.

 
 
  Linda Piazza   12/30/20,  11:54:18 AM
The advdec line just confirmed its own H&S, and sometimes these formations on the advdec line do have some import in determining equity behavior. Possible support (if we can talk about support for the advdec line) at about +300, with bears wanting to see the advdec line below that and then going negative.

 
 
  Linda Piazza   12/30/20,  11:50:26 AM
The SOX has been flatlining most of the day after the first surge brought it above the 200-sma. If I look at the price pattern itself, it's reminiscent of a rounding-top pattern on the five-minute chart, but if I then glance down, I see that MACD has been rounding down while prices have held relatively steady, and that's more bullish than bearish. Of course, if I then glance over, I note the bearish price/MACD divergence on that five-minute chart, so I'm back to looking at the pattern as a potential rounding-top formation. The truth is, I think the SOX would have rounded over but for that 200-sma just beneath. From here out, it depends on the resolve of the bulls versus the bears. Bulls have been buying as it dipped toward the 200-sma, keeping it from keeling over, but they need to maintain that buying behavior. At some point, I wouldn't be surprised to see a stop-run below the 200-sma and the outcome of that stop-run determining what happens from then on. Will it be bought or sold?

 
 
  Jeff Bailey   12/30/20,  11:39:12 AM
Peregrine Pharma (PPHM) $1.22 +6.08% ... little pop to its 21-day SMA

wondering if buyers can get the push to the 50-day SMA like JDSU did yesterday?

 
 
  Linda Piazza   12/30/20,  11:35:13 AM
Is the OEX in the process of forming that right shoulder? It could be, but it also resisted falling through the neckline a few minutes ago. I suspect that it's going to attempt to invalidate the formation by running higher, so let's see if that works any better than the confirmation did.

 
 
  Linda Piazza   12/30/20,  11:23:01 AM
Interesting. Miniature potential H&S on the advdec line's three-minute chart, with the advdec line also rising into a right shoulder as I type.

 
 
  Linda Piazza   12/30/20,  11:21:26 AM
The OEX charges straight up toward the 575.50 level.

 
 
  Linda Piazza   12/30/20,  11:17:46 AM
The OEX attempts a bounce now, and bulls should be watchful as that 577.50 level is approached, if it is. Three-minute charts did show bearish price/MACD divergence as the head was produced.

 
 
  Jeff Bailey   12/30/20,  11:11:39 AM
11:00 Internals at this Link

Yesterday's internals at this Link

 
 
  Linda Piazza   12/30/20,  11:11:39 AM
The SOX is still about a point above its 200-sma, but off its day's high.

 
 
  Linda Piazza   12/30/20,  11:11:02 AM
TRAN negative now. I didn't expect it to get too far to the upside today. After printing a doji the day after a tall white candle, it usually follows with doji or other small-bodied candles or else actually declines.

 
 
  Linda Piazza   12/30/20,  11:08:38 AM
The OEX has fulfilled at least part of the bulls-don't-want-to-see scenario. It's drifted down to an appropriate H&S neckline. If it should bounce again, bulls should remain aware of the possibility that it could be forming a right shoulder. Bulls should likely expect some hesitation at that right-shoulder level, near 577.50. Keltner lines suggest there should be hesitation there, too. The question will be whether the OEX can eventually push through that level and negate the formation or whether it will round over into a right shoulder.

The other possibility is that the OEX just falls without ever forming a right shoulder.

 
 
  Jeff Bailey   12/30/20,  11:04:53 AM
11:00 Market Watch at this Link

 
 
  Jeff Bailey   12/30/20,  10:54:50 AM
HL Camp & Company has their computers set for program buying at $3.42 and selling at $1.52.

Thought they might have been taking the rest of the week off as they hadn't posted them this morning.

On Wednesday, HL Camp said NSC, CSC, OMX, RSH, PFE, FDX and ALL were OEX stocks that were bought the most during buy programs executed by program trading firms.

G, C, GD, F, DOW, BA, USB and HNZ were stocks that were sold the most during sell programs executed by program trading firms.

 
 
  Linda Piazza   12/30/20,  10:53:44 AM
As you watch the action on the OEX, keep the bulls-don't-want-to-see scenario in my 10:41 post in mind.

 
 
  Jeff Bailey   12/30/20,  10:53:28 AM
QQQQ $40.01 -0.02% ... SOX.X 432.82 +0.53% and BTK.X 546.69 -0.26% provide the mixed look. Breadth for QQQQ is postive, but just fractions at 55:45.

NASDAQ-100 Heatmap at this Link

 
 
  Linda Piazza   12/30/20,  10:45:43 AM
TRAN has a doji for the day now.

 
 
  Linda Piazza   12/30/20,  10:41:26 AM
Here's what OEX bulls don't want to see happen: They don't want to see the OEX decline now to about 576.80-577.00 and then climb, say to 577.50 and then roll down again. Be aware of that possibility. I can't help remaining distrustful this morning of anything I'm seeing and I think that's wise for anyone during a holiday week, but none of the bearish possibilities have yet come true while many of the bullish ones have. Just protect those profits, though, and remain cautious.

 
 
  Jeff Bailey   12/30/20,  10:38:05 AM
The reason I said "Tsk, tsk, tsk" Linda is that PPHM traded to the upside of the "inside day," and I'm looking for relief of tax-loss selling to have the stock trending higher.

While PPHM is not a component of the BTK.X, or BBH, I would like to see the BTK.X hold this 545 neckline of the reverse h/s, get some momentum going to the upside, and perhaps in January, get some of that large short interest in PPHM to take profits in early January.

PPHM's "like stock" ENMD Link got some pretty good upside action from the $2.00 level (also an inside day).

 
 
  Linda Piazza   12/30/20,  10:37:53 AM
The OEX did break out of that bull flag to the upside. Despite my distrust and confusion, it behaved just as it should have behaved, so I'm glad I at least noted the flag for the benefit of less distrustful readers. Bulls need to see the OEX clear the 577.75 Keltner channel resistance it's approaching on a 15-minute closing basis. If it pulls back instead, they want to see 15-minute closes above the Keltner lines currently at 576.27 and preferably above the one at 576.90 or so. They need to have profit-protecting plans in place as 579.50 is approached, if it is. Exercise some caution here, though, in this light-volume environment.

Hey, Jeff, have you got some kind of padding underneath your office chair in case you have to fall down if the OEX hits 584? The weekly Keltner chart suggests that 581.30 might be tough resistance, but that's on a weekly close, and a candle could certainly spike to 584 and then move down inside the channel line again by the weekly close.

 
 
  Linda Piazza   12/30/20,  10:32:44 AM
Jeff, I haven't reviewed them (inside day trades) in a while because I gave them up a year or two ago, but I don't rely on stochastics much any more, so that wouldn't be it. Stochastics used to be my favorite indicator and I didn't much like MACD. However, MACD was my friend during 2003 when I'd look at charts and see them extended in a way that was just scary, but there was MACD, pointing up still. I like to watch CCI and RSI trendline and formation breaks, too, and of course watch those 100/130-ema's on several time period charts. My (anecdotal only) impression over the last months is that we often see an inside-day breakout early in the morning when some economic news is due, as happened this morning, so I'd have to attribute my distrust now at least partly to that.

 
 
  Jeff Bailey   12/30/20,  10:26:37 AM
I will agree with you on the GSO.X Linda. Yesterday my face started scrunching, I started to stoop over in a hunchback manner, and I thought I heard the chime of church bells.

 
 
  Jeff Bailey   12/30/20,  10:25:15 AM
Inside Day .... when you reviewed those trades Linda, could you figure out "what went wrong" compared to the winning trades? MACD setup? Stochastics? Sector?

 
 
  Linda Piazza   12/30/20,  10:25:00 AM
I think Jeff and I can probably agree that the GSO right shoulder is extending way too far. The GSO is near yesterday's high, not yet above it. The GHA is above yesterday's high, but not yet above a possible bull flag's resistance. The TRAN, as I mentioned earlier, is at a new relative high today, but not zooming up yet, and I don't really expect it to do so because of its usual tendency after printing a doji the day after a tall white candle. I'm wondering if we're not seeing indices sitting somewhere near their highs of the day, with some chopping around due for the rest of the day. On days when I find matters this confusing early in the day, that's sometimes what occurs, my personal "Linda confusion" index. I used to try to fight my way to some conclusion until I realized that was my conclusion: something was leading me to believe more in choppy behavior than a directional one. I'll see if something changes my mind later.

 
 
  Jeff Bailey   12/30/20,  10:22:46 AM
Current OPEN MM Profiles at this Link

 
 
  Linda Piazza   12/30/20,  10:17:54 AM
The OEX's five-minute chart shows a likely bull flag pulling back from resistance with the OEX trying to break through the bull flag resistance as I type, but not yet making a convincing job of it.

I have to say that I'm just plain confused this morning, and so reluctant to say too much, afraid that I have some bias that I haven't been able to ferret out that's making me confused. Maybe it's all as clear as day what's going on and where markets are headed today, but I sure can't figure it out. The OEX looks as if it spiked up this morning above the 577-ish neckline of an inverse H&S without ever bothering to form the right shoulder, but now it's not going much of anywhere after such a seemingly bullish event. On the 15-minute Keltner chart, support below near the 576 level looks stronger than nearby resistance, but the OEX can't really pull clear of that trendline off the 11/27 high, either. If that's just a bull flag, then it's forming along that trendline after it broke through and then the OEX is likely going to attempt to climb, perhaps toward the top of its two-months-in-the-making ascending regression channel. Top resistance there is 579.44 as I type, also top Keltner resistance on the 15-minute chart. It's got some congestion to get through first, and it's just not reacting as I'd expect, but . . . well, heck, I don't know what. So far, it all looks bullish. This hesitation doesn't feel that way, and too many indices face too much important resistance for me to feel confident of that, though.

 
 
  Linda Piazza   12/30/20,  10:08:03 AM
I'm just frankly puzzled by equity markets' failures to react to anything. Crude pops yesterday and equity investors don't seem to notice. Dollar dives and they don't seem to notice.

 
 
  Linda Piazza   12/30/20,  10:06:22 AM
The dollar dives against the yen and euro.

 
 
  Linda Piazza   12/30/20,  10:04:25 AM
Because I'm not a fan of inside-day theory, Jeff? (See Jeff's 10:03 post.) Been faked out a time or two too many, myself only to see the things reverse.

 
 
  Jeff Bailey   12/30/20,  10:03:09 AM
Tsk....tsk.. tsk... Linda. (10:00:36)

 
 
  Linda Piazza   12/30/20,  10:03:06 AM
U.S. Dec Chicago PMI 61.2 against expectations for 63.1.

 
 
  Jeff Bailey   12/30/20,  10:02:29 AM
10:00 Market Watch at this Link

 
 
  Linda Piazza   12/30/20,  10:02:26 AM
Headlines declare that the U.S. Help-Wanted Index has matched its four-decade low, falling a point to 36.

 
 
  Linda Piazza   12/30/20,  10:00:36 AM
If you're a fan of inside-day theory (I'm not), then you're long a whole lot of things this morning. Be wary of the move above yesterday's inside day on the OEX and other indices being a fake-out move. Careful going into the 10:00 numbers.

 
 
  Linda Piazza   12/30/20,  9:58:09 AM
The BIX pushed a little above the 12/22 high and now has retreated below that high. It hasn't retreated far, but there's a possibility now of a double-top formation on the 60-minute chart due to some bearish price/oscillator divergences showing up. Both RSI and CCI turn up again, however, beginning to break through descending trendlines. These leading indicators have a pesky little tendency to redraw themselves so that when you look at a chart later, the development (in this case, an upward break of a descending trendline) you could have sworn was there is no longer there. Therefore, I'm not counting too strongly on those tentative trendline breaks, but if they hold, they suggest upward pressure despite the current bearish divergence. Confusing? Isn't everything these days? That's what's leading to this choppy behavior.

 
 
  Linda Piazza   12/30/20,  9:53:15 AM
The TRAN has pushed to a new relative high today, after yesterday's doji, but its gains so far have been modest. Usually after printing a doji after a tall white candle, the TRAN either prints a series of doji or other small-bodied candle in a straight line or actually retreats. Therefore, I'm not expecting big upward movements from the TRAN today. Market bulls do not want to see it turn negative.

 
 
  Jeff Bailey   12/30/20,  9:52:52 AM
VIX.X 12.26 +5.42% .... Daily Pivot Levels .... 11.52, 11.60, Piv = 11.69, 11.77, 11.86.

 
 
  Linda Piazza   12/30/20,  9:50:32 AM
The SOX is above its 200-sma this morning, with that average at 431.49 and the SOX currently at 432.97, easing a little from the HOD. Twice this month, the SOX has punched above that average intraday, but closed either below it or at it, so bulls can't quite count their chickens . . . or would that be calves? . . . just yet.

 
 
  Linda Piazza   12/30/20,  9:48:11 AM
This morning, the VIX decided to join the VXO and gapped higher, above Tuesday's level the bulk of Tuesday, a day after the VXO did. Not the VXN, however. It's headed lower. Is it going to be one of those days again?

 
 
  Linda Piazza   12/30/20,  9:46:02 AM
Jane has mentioned the 10:00 economic release. Be careful ahead of that release. Markets are buoyed by some overnight and early morning developments, but could still be deflated in this light-volume environment.

 
 
  Jeff Bailey   12/30/20,  9:44:58 AM
Pfizer (PFE) $27.10 -0.55% ....

 
 
  Linda Piazza   12/30/20,  9:43:26 AM
The OEX currently tests that 577.00-577.25 resistance. It's punched above a descending trendline off the early morning 12/27 high, but is retreating as I type. I'm watching on a 15-minute chart, seeing if it leaves only a candle shadow above that trendline or if the candle body closes above it. That trendline is now at about 577.

 
 
  Linda Piazza   12/30/20,  9:41:03 AM
Concerning Japan's intervention or non-intervention into the currency markets, Reader V.P. sent along an AFX article saying that Japan's Minister of Finance claimed that the MoF did not intervene in the forex markets from November 27 to December 28, but would be monitoring currencies during the New Year holiday. According to the article, that increased speculation that Japan could intervene during the holiday. I'd been picking up rumors here and there of that possibility, too. Of course, rumors are just that until verified. Thanks, V.P.

 
 
  Jane Fox   12/30/20,  9:36:20 AM
The National Association of Purchasing Management of Chicago is due to release its December purchasing managers' index at 10 a.m. EST. (Consensus 63.0 vs. prior 65.2)

 
 
  Jeff Bailey   12/30/20,  9:35:40 AM
Swing trade long alert ... for a tax-loss bounce ... 1/2 bullish position in Peregrine Pharma (PPHM) Link at the offer of $1.16, stop $1.10, target $1.39.

 
 
  Linda Piazza   12/30/20,  9:32:52 AM
The OEX climbs toward likely short-term 577-577.15 resistance.

 
 
  Jeff Bailey   12/30/20,  9:32:44 AM
200-day SMA alert .... Tyson Foods (TSN) $18.06 +0.22% ...

 
 
  Jeff Bailey   12/30/20,  9:29:35 AM
Horizon Offshore (HOFF) $0.48 ... surging to $1.17 and most actively traded pre-market after the marine construction company said it had agreed to install a gas transportation pipeline running 579 kilometers from Lagos, Nigeria to Takoradi, Ghana. HOFF received the contract from the West Africa Gas Pipeline Co. Ltd., a consortium of Chevron Texaco. Terms of the deal were not disclosed.

 
 
  Jeff Bailey   12/30/20,  9:25:30 AM
Pfizer (PFE) $27.26 ... lower at $27.00 after company said sales for its arthritis drug Celebrex fell 56% last week.

 
 
  Jeff Bailey   12/30/20,  9:21:44 AM
CMGI (CMGI) $2.60 ... "hot" at $2.81 in pre-market. No. 3 most active.

 
 
  Linda Piazza   12/30/20,  9:18:36 AM
For those who didn't catch Jonathan's post day before yesterday, he's out through the end of this week. The rest of us on the MM will try to help fill his shoes, too, but that's going to be difficult to do.

 
 
  Linda Piazza   12/30/20,  9:16:26 AM
Below, I'm including my OEX post from last night for those who didn't get an opportunity to view it before yesterday's MM was archived. I also wanted to note a few developments this morning that might prove beneficial for the equity markets. First, unemployment claims unexpected dropped 5,000 against an expected rise. A decline in crude prices might be at least partly attributable to an overnight Lehman Brothers prediction that global demand in 2005 would decline 200,000 barrels a day due to higher prices this year. Boeing was a big decliner yesterday due to news that China had all the aircraft needed and would not be buying more, but overnight China stated that it would be placing orders in 2005, but not accepting delivery until 2006. The following paragraphs include the post originally made last night. All in all, these early morning developments should be positive for equities, but yesterday they didn't seem to be reacting to any gyrations, including those in crude or currencies. Overnight futures action did little to clarify matters, so we'll want to see how markets set up this morning.

A small-bodied candle at resistance: That's what the OEX produced Wednesday, with the daily candle a harami or inside-day candle. Many other indices produced doji, with those indices including the TRAN, SPX, GSO and DJUSHB's, perhaps among others. Some indices showed more strength, with the RLX and SOX being among those indices, but altogether it was a day in which indices chopped between support and resistance. Perhaps it was just to me, but the OEX appeared to be choppier than some others, whipping back and forth across its five-minute 100/130-ema's while others tended to either find support or resistance at those averages. The OEX is mired within its latest congestion zone, however, and perhaps that choppiness was to be expected.

Before committing to a direction tomorrow, traders want to see some congruence between the OEX and other indices--either more bearish as a group or more bullish as a group rather than a mixture. Some congruence in internals might be helpful, too. A break out above 578.25 looks bullish, but you know how poorly breakout plays have performed lately. A breakdown below 573.85 or so looks bearish, but breakdowns might not work any better. Bounces from that support or rollovers from that resistance might make better entries, if offered, but the best bet might be to abstain from trading in a light-volume environment. Let's look tomorrow morning.

 
 
  Jane Fox   12/30/20,  8:34:23 AM
Dateline CNN Tsunami death toll now estimated at more than 115,000, officials in affected areas say.

 
 
  Linda Piazza   12/30/20,  7:04:57 AM
Good morning. The Nikkei climbed in a half-day session that marked its last trading day of the year. Other Asian markets showed mixed performances, and European markets trade somewhat cautiously this morning. Our futures have stayed relatively steady all night, with a slight dip near the European open. As of 6:34 EST, gold was down $1.40 and crude, down $1.10. More detail about Asian and European markets follows in succeeding paragraphs.

In a half day of trading that will mark its last trading day until January 4, the Nikkei opened back above 11,450, the level at which it had consolidated most of Wednesday before the late-day sell-off. It closed higher by 107.20 points or 0.94%, at 11,488.76. The bourse gained as the dollar firmed against the yen amid speculation that the Bank of Japan would intervene or had intervened. Exporters and banks gained. Shipping stocks were hit by a newspaper report that ocean freight rates dropped more than 50 percent this month. This information came from a formulation, the Worldscale schedule, used to determine shipping rates of crude from the Middle East to Japan. Some speculate that imports of raw materials have reached a peak.

Other Asian markets were mixed. The Taiwan Weighted gained 0.20%, and South Korea's Kospi climbed 1.32%. Singapore's Straits Times gained 0.18%. Hong Kong's Hang Seng fell 0.72%, and China's Shanghai Composite declined 0.05%. Yesterday, Boeing was hit by news that China had all the planes it needed for next year, but China spelled out its position, saying that it would not take delivery next year, but would place orders next year for delivery in 2006.

Many European markets trade cautiously this morning. In an article for the WSJ, German Chancellor Schroeder stated that currency issues will be one focus of an upcoming G8 meeting in January. Some insurers or reinsurers continue a rebound as Swiss Re gave a low estimate for the financial impact it expects from the tsunami. In the U.K., many homebuilders climbed in early trading, perhaps in a sell-the-rumor, buy-the-fact effect after Nationwide gave figures on housing prices, saying they fell 12.7% in 2004 and 0.2% in December. The lender expects housing prices to climb by 2% in 2005.

As of 6:54 EST, the FTSE 100 had climbed 1.20 points or 0.02%, to 4,821.00. The CAC 40 had climbed 5.28 points or 0.14%, to 3,832.44. The DAX had climbed 8.97 points or 0.21%, to 4,256.72.

 
 
  Jeff Bailey   12/29/20,  1:54:56 AM
February Crude Oil (cl05g) Updated daily interval chart at this Link

 
 
  Jeff Bailey   12/29/20,  12:21:25 AM
12/29/04 from more recent 11/29/04 Sector Bell Curve from Dorsey/Wright at this Link

 
 
  Jeff Bailey   12/29/20,  12:10:25 AM
12/29/04 and 12/29/03 Sector Bell Curve from Dorsey/Wright and Associates at this Link

 
 
  Jeff Bailey   12/29/20,  9:54:45 PM
Swing trade bullish call place stop alert ... After writing Wednesday evening's Index Trader Wrap Link I will place the following two (2) stop profit orders on the two (2) IWO May $63 Calls (IWO-EK).

On the one (1) call bought on 11/08/04, placing a stop at IWO $65.45.

On the one (1) call bought on 11/10/04, placing a stop at IWO $64.75.

I will probably look to exit one (1) of these calls, should the IWO trade $70.00 in the next two weeks.

Current OPEN MM Profiles at this Link with updated stops for the IWO calls.

 
 
  Jeff Bailey   12/29/20,  9:43:04 PM
Pivot Matrix for tomorrow at this Link

 
 
  OI Technical Staff   12/29/20,  7:45:19 PM
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