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Jeff Bailey : 1/27/2005 12:14:00 AM

Buy/Sell Program Levels HL Camp & Company has their computers set for program buying at $1.76 and set for program selling at $-0.26.

Jeff Bailey : 1/26/2005 11:57:22 PM

March Crude Oil futures (cl05h) $48.92 +0.28% are up $0.14.

e-mini S&P futures (es05h) 1,172.75 -0.04% are off $0.50.

Pretty close to where they both were the evening of 01/23/05.

OI Technical Staff : 1/26/2005 11:16:42 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

Disclaimer: Stocks discussed in the Market Monitor are for educational purposes only and any analysis is not meant to imply a recommendation for or against that stock. The analysts in this forum as on any other website are prohibited by the SEC from giving any specific advice to ANY individual trader. All information posted is for ALL readers and is not meant to be directed to any individual. Our analysts cannot answer any email questions regarding any specific stock. Please do not ask and please do not take offense if requests are denied.

Results posted in the Market Monitor are hypothetical and OIN does not claim that any reader achieved these exact results. Due to the lag time between research, writing, posting, uploading, reading and execution there will be differences between the actual signal given and the fill achieved by the reader. Fills may be better or worse but in most cases they will be different. The writers will make every effort to give advance notice of intended signals and indicate potential price targets. Your individual results may vary depending on your activity level and aggressiveness. This forum is intended as an education service only. Trading involves risk and should not be attempted by anyone not ready to accept this risk. By acting on any signal in this forum you agree and personally accept this risk.

Linda Piazza : 1/26/2005 9:16:48 PM

After outperforming some other indices over recent days, the OEX underperformed by some measures on Wednesday. Unlike the Nasdaq, for example, the OEX did not reach a new high of the day late Wednesday afternoon. It didn't even reach an equal high. Even the Nasdaq, however, was stopped at its 30-minute 100/130-ema's Friday afternoon. As was the OEX. The OEX spent most of the day challenging those averages, forming a diamond shape at the top of its climb.

A study of the daily chart shows two days of climbs, but two days in which the day's action left upper shadows as the OEX fell back from the high of the day. The rise continues to look suspect. Here's a look from the perspective of a daily chart posted many times over the last two weeks, complete with annotations that have been there all week this week: Link

Both days, the OEX retreated from the morning high, but both days, it would have been difficult for options traders to make a profit. I did not suggest entering new bearish plays on the rollover from the morning's high for that reason. Selling the rallies still appears to be the best approach, but perhaps an approach still best passed up for all but the most adept scalper.

A move above those 30-minute 100/130-ema's might suggest a rise toward 566-568, but I don't feel comfortable suggesting longs in this climate, ahead of this weekend's event risk and when they may still be countertrend plays. We'll take a look at all of this tomorrow morning, however.

Jim Brown : 1/26/2005 6:07:08 PM

BR earnings = +1.17, est +1.13 declared 8.5 cent dividend

Jim Brown : 1/26/2005 5:29:07 PM

Alert - STM earnings = +0.20, est +0.20

Jim Brown : 1/26/2005 5:15:05 PM

Alert - VRSN raising guidance for the year on conference call

Jim Brown : 1/26/2005 5:10:47 PM

XRAY earnings = +0.83, est +0.63 Big beat!

Jeff Bailey : 1/26/2005 4:59:26 PM

Swift Transport (SWFT) $20.82 +5.36% Link ... extends gains to $21.45 after reporting quarterly earnings. (see Jim's 04:35:28)

Jim Brown : 1/26/2005 4:56:53 PM

PKI earnings = +0.33, est +0.31 Guiding lower

Jeff Bailey : 1/26/2005 6:10:10 PM

Closing U.S. Market Watch at this Link
Closing Internals at this Link
Pivot Matrix for Thursday at this Link

Jim Brown : 1/26/2005 4:48:40 PM

TALX earnings = +0.33, est +0.29 Raising guidance

Jim Brown : 1/26/2005 4:47:16 PM

OSTK announcing stock buyback ahead of earnings tomorrow

Jim Brown : 1/26/2005 4:40:27 PM

PHTN trading down -3 after earnings

Jim Brown : 1/26/2005 4:39:09 PM

SWIR earnings = +0.28, est +0.29 Guiding lower

Jim Brown : 1/26/2005 4:35:28 PM

SWFT earnings = +0.50, est +0.42

Jim Brown : 1/26/2005 4:34:49 PM

EFII earnings = +0.06, est +0.05 Guidance flat

Jeff Bailey : 1/26/2005 6:12:35 PM

Current OPEN MM Profiles at this Link
Today's Activity ....

Closed out the day trade short (carried overnight) from Tuesday in Southwest Air (LUV) at the offer of $14.28. ($+0.05, or +0.35%)

Closed out the swing trade covered call for SanDisk and the one (1) SNDK Feb. $27.50 Call (SWQ-BY) at the offer of $0.10. ($+1.05, or 1050%).

Swing trade long three (3) YELL Feb. $55 calls (YUX-BK) at the offer of $1.05.

Day traded long the underlying shares of Canadian Pacific Railway (CP) at the offer of $33.40, but was stopped at $33.30. ($-0.10, or -0.30%). ...... Should'a traded Yahoo! from $34.70 instead.

Jim Brown : 1/26/2005 4:31:10 PM

CNQR earnings = +0.03, est +0.01

Jim Brown : 1/26/2005 4:30:54 PM

CNXT earnings = -0.20, est -0.19

Jim Brown : 1/26/2005 4:23:10 PM

MUSE earnings = +0.03, est +0.03

Jim Brown : 1/26/2005 4:22:33 PM

VARI earnings = +0.46, est +0.42

Jim Brown : 1/26/2005 4:21:13 PM

IDTI earnings = +0.06, est +0.03

Jim Brown : 1/26/2005 4:20:14 PM

CRUS earnings = +0.03, est -0.05 with items

Jim Brown : 1/26/2005 4:19:10 PM

BSTE earnings = +0.68 , est +0.59

Jim Brown : 1/26/2005 4:17:37 PM

VAR earnings = +0.29, est +0.25

Jim Brown : 1/26/2005 4:17:13 PM

SPRT earnings = +0.05, est +0.03

Jim Brown : 1/26/2005 4:16:07 PM

Alert - LSI earnings = +0.04 , est +0.01

Jim Brown : 1/26/2005 4:16:03 PM

CVD earnings = +0.42, est +0.42

Jim Brown : 1/26/2005 4:15:25 PM

POWI earnings = +0.14, est +0.12

Jim Brown : 1/26/2005 4:14:19 PM

BCR earnings = +0.65, est +0.62

Jim Brown : 1/26/2005 4:12:27 PM

Alert - JDSU earnings = -0.02, est -0.01 guidance below estimates

Jim Brown : 1/26/2005 4:11:43 PM

Alert - DRIV earnings = +0.43, est +0.35

Jim Brown : 1/26/2005 4:11:18 PM

RNWK earnings = +0.01, est -0.01

Jim Brown : 1/26/2005 4:11:13 PM

HIG earnings = +2.00, est +1.78

Jim Brown : 1/26/2005 4:10:49 PM

VRSN earnings = +0.21, est +0.20

Jim Brown : 1/26/2005 4:07:18 PM

PLCM earnings = +0.22, est +0.21

Jim Brown : 1/26/2005 4:06:24 PM

WBSN earnings = +0.33, est +0.31

Jim Brown : 1/26/2005 4:05:47 PM

Alert - AFFX earnings = +0.41, est +0.37

Jim Brown : 1/26/2005 4:05:38 PM

GNSS earnings = +0.09, est +0.05

Jim Brown : 1/26/2005 4:05:26 PM

RBAK earnings = -0.08, est -0.10

Jonathan Levinson : 1/26/2005 4:05:09 PM

QQQQ drops sharply to 37.09, previous resistance and current 30 min channel support. A failure to bounce back above 7200 tick SMA resistance at 37.15 within the next 5-10 minutes will stall the current 30 min cycle upphase.

Jeff Bailey : 1/26/2005 4:04:47 PM

Sell Program Premium ... DIA $104.88, SPY $117.34

Jim Brown : 1/26/2005 4:04:45 PM

HRS earnings = +0.75, est +0.66 , after items a big beat, raising guidance

Jim Brown : 1/26/2005 4:03:29 PM

Alert - SBUX earnings = +0.35, est +0.34

Jim Brown : 1/26/2005 4:03:02 PM

AMCC earnings = -0.01, est -0.01

Jim Brown : 1/26/2005 4:03:14 PM

Alert - CHIR earnings = -0.04, est +0.10 big miss

Jim Brown : 1/26/2005 4:02:41 PM

VAR raising guidance

Jim Brown : 1/26/2005 4:01:57 PM

RMBS doing a $300 million offering

Jim Brown : 1/26/2005 4:00:59 PM

PHTN earnings = +0.01, est +0.02

Jim Brown : 1/26/2005 4:01:28 PM

SYK earnings = +0.40, est +0.40

Jim Brown : 1/26/2005 4:00:25 PM

SRDX earnings = +0.32, est +0.25

Linda Piazza : 1/26/2005 3:55:56 PM

Two days of strong climbs on the OEX. Will it end like the climbs seen on 1/14 and 1/18?

Jeff Bailey : 1/26/2005 3:55:45 PM

Sell Program Premium ... SPX.X 1,174.95, QQQQ $37.24, DIA $104.97

Jonathan Levinson : 1/26/2005 3:55:04 PM

QQQQ looks like it's going to go out at the highs on a breakaway gap upon- a bullish formation. There's a bullish kiss on the daily cycle stochastic, and a close above 37.40 should generate buy signals on the daily cycle oscillators.

James Brown : 1/26/2005 3:51:00 PM

It's interesting to see GE under performing today's rally.

Linda Piazza : 1/26/2005 3:49:45 PM

Oh, so close, but not there yet. The 30-minute 100/130-ema's still hold the OEX back.

James Brown : 1/26/2005 3:48:19 PM

ConocoPhillips (COP) is up 2% and breaking out over the $90.00 level. Shares are nearing new all-time highs here.

Jeff Bailey : 1/26/2005 3:46:23 PM

TRIN 0.99 +17.85% ...

James Brown : 1/26/2005 3:45:56 PM

Homebuilder BZH is rebounding sharply (+3.76%) from support at its 40-dma and the $140 level. Watch out for BZH's earnings report tomorrow. Estimates are for $4.36 a share.

James Brown : 1/26/2005 3:44:54 PM

The bounce in the DJUSHB home construction index is picking up speed. After a week of consolidating above support at the 800 level this is starting to look like a bullish entry point.

James Brown : 1/26/2005 3:42:32 PM

The recent breakdown in KCI and today's relative weakness make the stock look like a bearish candidate. Readers can watch for a drop under $65.00 as a potential entry point and target the 100-dma near $60.00. KCI's P&F chart shows a bearish triangle breakdown with a $58 target.

Linda Piazza : 1/26/2005 3:40:49 PM

That drop below the diamond's support was short-lived. The OEX hit the 30-minute 21-ema and bounced again. It's now back to a challenge of the 30-minute 100/130-ema's and has a chance of closing above them. Needs a move above the HOD to confirm that inverse H&S on the top of that chart. The OEX is within striking distance of that. I sure do hate these late-day moves, so that you never know if stops just got run at the end of the day or if the move meant something.

James Brown : 1/26/2005 3:39:25 PM

The rally in General Dynamics (GD) is picking up speed with shares now up 4.2% and breaking out over the $103.00 level (last week's resistance) and its 100-dma.

James Brown : 1/26/2005 3:38:50 PM

Dow-component JNJ is seeing some follow through on yesterday's rally with a 1.44% bump today. More importantly JNJ is now breaking out above resistance near $64.00 on above average volume. The MACD indicator has produced a new buy signal.

Jim Brown : 1/26/2005 3:42:14 PM

Some of the important earnings tonight
BR . est +1.13 - GNSS est +0.05 BCR. est +0.62 - IDTI est +0.03 CBT. est +0.53 - JDSU est -0.01 CVD. est +0.42 - MUSE est +0.03 FBN. est +0.36 - PHTN est +0.02 HRS. est +0.66 - PLCM est +0.21 HIG. est +1.78 - POWI est +0.12 LSI. est +0.01 - RNWK est -0.01 PKI. est +0.31 - RBAK est -0.10 STM. est +0.20 - SWIR est +0.29 SYK. est +0.49 - SBUX est +0.34 VAR. est +0.25 - SPRT est +0.03 AFFX est +0.37 - SRDX est +0.25 AMCC est -0.01 - SWFT est +0.42 BSTE est +0.59 - TALX est +0.29 CHIR est +0.10 - TTEK est +0.14 CRUS est -0.05 - VARI est +0.42 CNQR est +0.01 - VRSN est +0.20 CNXT est -0.19 - WBSN est +0.31 DRIV est +0.35 - XRAY est +0.63 EFII est +0.05

Jonathan Levinson : 1/26/2005 3:36:03 PM

QQQQ's just popped above 37.20 resistance, current high of 37.24. Looks like the Fed's big repo is finding a new home. If the bulls can run above 37.40, the daily cycle upphase should begin.

Jonathan Levinson : 1/26/2005 3:32:09 PM

No pullback after the lurch higher, with a current session high up at our 37.20 level. Look for 37.09 QQQQ to act as support on any pullback.

Jeff Bailey : 1/26/2005 3:37:15 PM

Oil Service (OSX.X) 127.88 +0.03% ... bids back green. All equity-based sectors in positive territory.

Jeff Bailey : 1/26/2005 3:24:02 PM

03:00 Internals at this Link

Jonathan Levinson : 1/26/2005 3:23:07 PM

QQQQ's setting a new high now on a surge in volume, testing upper 30 and 60 min channel resistance at 37.15.

Jeff Bailey : 1/26/2005 3:19:26 PM

Bullish day trade stop alert ... for Canadian Pac. Railway (CP) $33.30 -0.75%. ($-0.10, or -0.30%)

Linda Piazza : 1/26/2005 3:12:16 PM

I'm still not certain that the diamond shape at the top of the OEX's climb (seen on the 30-minute chart) is valid, but the OEX has just broken below the diamond's supporting line.

Jonathan Levinson : 1/26/2005 3:11:19 PM

Rising 72000 tick SMA support is up to 37.01 currently, with the 30 min cycle channel for QQQQ edging back up.

Jeff Bailey : 1/26/2005 3:09:19 PM

03:00 Market Watch at this Link

Jonathan Levinson : 1/26/2005 3:08:12 PM

QQQQ is now pulling back for a fourth time below 37.09, but perhaps more importantly, it's been bouncing above 37.02. I think it's going to break to the upside, as QQQQ has been consistently unwilling to go down today.

Jeff Bailey : 1/26/2005 3:06:12 PM

March Crude (cl05h) settles down $0.86, or -1.73% at $48.78 on the NYMEX.

Linda Piazza : 1/26/2005 3:00:32 PM

The OEX still challenges the 30-minute 100/130-ema's. Been happening since yesterday. The shape at the top of yesterday's rise still looks like a diamond to me, but it's a diamond that's serving as the right shoulder for a possible inverse H&S visible on that chart. As I said earlier today, the OEX has to sustain values above the 30-minute 100/130-ema's before you can even think of that inverse H&S as having been confirmed. Now, since those averages have drifted lower during the day, you'd also have to see the OEX above the HOD, and even then . . . I'm skeptical. The OEX would still be within the broadening formation.

Jeff Bailey : 1/26/2005 2:55:26 PM

TRIN 1.15 +36.90% ... been pressed against DAILY R2 better part of afternoon.

Jeff Bailey : 1/26/2005 2:54:44 PM

S&P Banks (BIX.X) 368.25 +0.57% ... pressed against morning highs of 368.70, but just can't make the bullish move.

Jeff Bailey : 1/26/2005 2:53:48 PM

Dow Transports (TRAN) 3,529 (unch) ... stuck here for last hour.

Jonathan Levinson : 1/26/2005 2:49:46 PM

Crude oil is closed for the daytime session, -1.66% at 48.825.

Linda Piazza : 1/26/2005 2:47:46 PM

On the 15-minute OEX Keltner chart, the channels squeeze together as they settle into an equilibrium position. MACD flattens. Right now, support appears to be massing under the OEX, but that's deceptive when the Keltner channels are in an equilbrium position. Keltner basis lines align in the middle of the channels, and the OEX sometimes passes quite easily through what had looked to be massive support or massive resistance. No clues are given by this chart.

James Brown : 1/26/2005 2:42:10 PM

Short-term traders can watch FLIR for a breakout over the $60.00 level. The slowly ascending three-month channel looks pretty consistent and its MACD is nearing a new buy signal. The next level of resistance should be the $65 level. Watch out for earnings on February 2nd.

James Brown : 1/26/2005 2:38:51 PM

General Dynamics (GD) is rebounding from a potential short-term double-bottom after reporting better than expected earnings this morning. Looks like GD has soothed fears (at least for now) that defense cuts won't impact its earnings growth for 2005. Technicals are improving and its MACD just crossed into a new buy signal. Traders might watch for a move over $103.00 as a bullish entry point. More conservative traders can wait for GD to break the trend of lower highs.

Linda Piazza : 1/26/2005 2:35:24 PM

The OEX's pattern at the top of its rise as seen on its 30-minute chart is now beginning to look a little like a diamond shape to me. They're usually bearish, but you know the drill.

James Brown : 1/26/2005 2:35:19 PM

Genentech (DNA) was added to Merrill's "Focus 1" list this morning and shares responded by opening higher. Yet the rally failed at the $50.00 mark and shares are trading near their lows for the session. The P&F chart is still bearish with a $38 target.

Jonathan Levinson : 1/26/2005 2:35:08 PM

Mitigating against the bears is that generous 6.25B add from the Fed's open market desk. Unless QQQQ gets back below 36.88, confirmed with a break of the day lows, the 30 and 60 min downphases will be a wash, and the daily cycle will begin ticking up. Bonds have not advanced appreciably today, and with the Fed's dealers flush for the day, bears have little to hope for until a downside intraday trend develops.

Jonathan Levinson : 1/26/2005 2:25:23 PM

Bonds are back to unchanged, giving back their prior gains, with TNX now up .3 bps at 4.192%. 4.16% support held.

Linda Piazza : 1/26/2005 2:24:27 PM

The OEX has not been able to break above its 30-minute 100/130-ema's. The 21-ema on that chart is moving up closer, so that the OEX is being squeezed between that support and the overhead resistance.

Jim Brown : 1/26/2005 2:23:28 PM

OPEC president saying that he expects no production cuts until at least March due to unexpected demand and problems in Iraq.

Linda Piazza : 1/26/2005 2:23:02 PM

I was just looking at the Nasdaq's chart. Over the last month, that chart looks like an ADR's, doesn't it?

Jeff Bailey : 1/26/2005 2:17:18 PM

02:00 Internals at this Link

Jonathan Levinson : 1/26/2005 2:15:58 PM

Another failure below 37.09 QQQQ, but bears need to see a break of 36.95-37.00 support to rule out a whipsaw on this wavelet dip currently in progress.

Jeff Bailey : 1/26/2005 2:11:13 PM

March Crude (cl05h) $48.25 -2.80% (30-min delayed) ... testing WEEKLY Pivot.

Linda Piazza : 1/26/2005 2:06:40 PM

The OEX still challenges those 30-minute 100/130-ema's.

Jeff Bailey : 1/26/2005 2:05:52 PM

02:00 Market Watch Link

Linda Piazza : 1/26/2005 2:05:21 PM

Jeff's 2:00 post about the transports reminded me that I'd meant to mention that in addition to announcing inventory levels of its own today, the American Petroleum Institute also announced that 2004's U.S. demand for oil increased at a pace not seen in five years, mostly on demand for on-highway diesel fuel. That's a good sign for the economy but not for lower crude prices. I'm not certain what the API projects for this year.

Jonathan Levinson : 1/26/2005 2:04:39 PM

The previous 2 intraday highs failed at 37.08-.09 QQQQ. That level is current overlapping 30 and 60 min channel resistance, but the 30 min cycle will begin to rise within 5 minutes if QQQQ holds at or above current levels.

James Brown : 1/26/2005 2:00:30 PM

CNBC just reminded me... Google (GOOG) has a massive lock up coming on February 14th. GOOG currently has 273 million shares outstanding but on Feb. 14th a lock up expires on another 176.8 million shares. GOOG's earnings are expected on February 1st.

Jeff Bailey : 1/26/2005 2:00:17 PM

Dow Transports (TRAN) 3,530 (unch) ... come back to unchanged after near-test of 3,500.

Commercial airline and rails (see 01:48:27 day trade profile) provide bulk of stability.

Linda Piazza : 1/26/2005 1:55:21 PM

The OEX again tests its 30-minute 100/130-ema's, with those averages at 562.64 and 563.37. Bulls need to get the OEX above those averages and sustain values above them before any upside momentum can result. Bulls do not want to see the OEX roll down again from those averages.

Here's what the three-minute Keltner chart suggests is most likely. It suggests that 562.51-562.66 is resistance, and that the OEX is likely to turn down from there to retest support, with that support from 561.72-562.12. The support looks relatively firm, but a push down to 561.07 isn't precluded by that chart, as the OEX settles into an equilibrium position.

Linda Piazza : 1/26/2005 1:50:26 PM

The TRAN's test of its 100-ema has resulted in a swift climb. On the daily chart, all this zooming around has so far just resulted in a doji, though.

Linda Piazza : 1/26/2005 1:49:09 PM

The SOX is climbing again, at 396.68 as I type.

Jeff Bailey : 1/26/2005 2:39:16 PM

Day trade long alert for Canadian Pac. Railway (CP) $33.40 here, stop $33.30, target $33.85. Stock gapped higher to $34.05 at the open, then reversed to session low of $33.35.

Jonathan Levinson : 1/26/2005 1:42:30 PM

Session low for crude oil here at 48.05, currently -3.22%.

Jonathan Levinson : 1/26/2005 1:40:34 PM

QQQQ has held above the no-longer-rising 7200 tick SMA long enough to stall the rolling 30 and 60 min cycle channels. But it continues to struggle with 37.00 resistance, with the net result of a sideways drift for both the 30 and 60 min cycles. Note that QQQQ is within a couple of cents of its opening levels, holding the bulk of its gains from its gap up open. If the bears cannot do any damage with these 30 and 60 min cycle downphases, then I'd interpret that as confirmation of long-overdue daily cycle strength. To maintain a bearish bias, QQQQ will need to get down to at least the 36.60 level on this current intraday downphase- preferably back to Monday's low. Failing that, the higher 30 and 60 min cycle lows will be the first sign of daily cycle strength.

James Brown : 1/26/2005 1:37:46 PM

OI put plays ADBE, APOL and KMRT continue to display relative weakness by not participating in today's minor market bounce.

Jeff Bailey : 1/26/2005 2:37:31 PM

Pogo Producing (PPP) $42.48 -4.86% ... extends losses from yesterday after reporting weaker than expected quarterly results.

Hibernia Southcoast Capital lowered its rating on PPP to "hold"

James Brown : 1/26/2005 1:36:14 PM

Homebuilder PHM is producing a minor bounce that could be seen as a follow through on yesterday's reversal.

Linda Piazza : 1/26/2005 1:35:34 PM

The OEX did begin a bounce at 1:00, just as it did yesterday. (See my 12:53 post.) This time, however, the bounce did not bring the OEX up to a new high of the day, showing a divergence from yesterday's pattern. It's also not tumbling as quickly from the 1:30-ish level as it did yesterday, another divergence.

James Brown : 1/26/2005 1:34:29 PM

Don't forget that we plan on exiting Phelps Dodge (PD) this afternoon at the close to avoid tomorrow's earnings report.

With copper prices trading near multi-year highs PD could turn in a strong quarter. I suspect there's a chance they could announce a stock split.

James Brown : 1/26/2005 1:26:33 PM

The bounce in the SOX semiconductor index has helped push KLA-Tencor (KLAC) above the $45.00 level and the stock has broken its two-month trend of lower highs.

Jeff Bailey : 1/26/2005 1:24:49 PM

Oil Index (OIX.X) 410.61 +1.14% ... set to test its 10/07/04 relative high of 411.36.

ConocoPhillips (COP) $90.70 +2.02% percentage gainer among producers. COP reported quarterly earnings and said that higher oil prices helped boost quarterly income to $2.15 billion, or $3.51 per share versus $985 million, or $1.43 per share in the same period a year ago.

The recent quarterly EPS were well ahead of analysts' estimates of $3.07.

Jeff Bailey : 1/26/2005 1:10:09 PM

01:00 Internals at this Link

Linda Piazza : 1/26/2005 1:05:28 PM

The OEX looks as if it's trying to roll down again, looking vulnerable to lower prices, but it hasn't really broken down below mid-channel Keltner S/R on the 15-minute chart. It's just looking vulnerable to a break below that support, perhaps only to 560.80 or so, and perhaps to 558.97. So far, though, it's holding minimally to the rising trendline off yesterday's low. That rise still looks bearish rising wedge-ish to me, however. I mentioned this wedge earlier today, and now it's narrowing a bit, but won't actually reach its apex for a long, long time. If we have to wait for the OEX to move 2/3 of the way through that rising wedge before it breaks down, as sometimes happens, we'd have a long, long time to wait and the OEX would complete some miraculous feats to the upside in the meantime, while climbing within that "bearish" formation. So, I'm still watching the trendlines.

Jeff Bailey : 1/26/2005 1:02:01 PM

01:00 Market Watch Link

Jonathan Levinson : 1/26/2005 12:54:18 PM

Stepping away for 20 minutes here.

Jonathan Levinson : 1/26/2005 12:53:34 PM

Session low for GE here as QQQQ fails again below the 7200 tick SMA line at 36.94 currently. Bonds have eased off their highs, with TNX now down 1.6 bps at 4.173%. Volume is quite low, with QQQQ only traded 49.9M shares so far today (compared with yesterday's 120M and the ADV of 94.394M).

Linda Piazza : 1/26/2005 12:53:31 PM

The OEX's fifteen-minute candles are forming right along the mid-channel S/R line, just as they did through the middle of the day yesterday. Yesterday saw one more stop-running push that began on the 1:00 candle before the OEX finally keeled over and moved down in the afternoon. Is there going to be a stop-running push starting soon, following that pattern? And which direction?

Linda Piazza : 1/26/2005 12:49:08 PM

I'm writing the Wrap tonight. My dearish wish is for something definitive to happen today so I'll know what to say. I don't care which direction. If any of you could do anything to help that along, I'd be eternally grateful.

Linda Piazza : 1/26/2005 12:46:04 PM

The OEX is finding resistance at its 30-minute 100/130-ema's today but is finding support (on a 30-minute closing basis) at its 30-minute 21-ema. It's currently attempting to rise from that average, although not too successfully today.

Jonathan Levinson : 1/26/2005 12:45:50 PM

QQQQ has so far failed below declining 7200-tick SMA resistance, but refuses to fall away. On the 30 minute chart, a break below 36.75-.80 would represent a break of what I believe to be a small bear wedge rising off the Monday. A break above 37.20 would invalidate it if that occurs first. The 30 min cycle downphase that kicked off earlier this morning is so far weak, but I believe that to be the result of the 60 min cycle taking longer to make its turn.

Linda Piazza : 1/26/2005 12:36:44 PM

The TRAN is trying to pull up ahead of 3500, at 3504.16 as I type.

Jeff Bailey : 1/26/2005 12:27:51 PM

S&P Banks (BIX.X) 367.65 +0.40% ... mid-point of today's range and WEEKLY Pivot right here.

Jeff Bailey : 1/26/2005 12:28:59 PM

10-year yield ($TNX.X) down 1.8 bp at 4.171% ... session lows and DAILY Pivot here.

5-year yield ($FVX.X also down 1.8 bp at 3.685%

Tab Gilles : 1/26/2005 12:37:35 PM

$COMPQ/$NASI I'm still bias to further downside on the Nasdaq. Link

Linda Piazza : 1/26/2005 12:16:35 PM

The TRAN is right at its 100-ema, actually easing a little below it as I type. Further support lies at 3500 and at the 38.2% retracement of the August rally, at 3492.37.

Jonathan Levinson : 1/26/2005 12:14:09 PM

QQQQ is testing descending 7200 tick SMA resistance at 36.95 from below. A break and hold above this level is needed to stall the 30 and 60 min downphases that are trying to get started. A lower high to the bounce will confirm these downphases.

Linda Piazza : 1/26/2005 12:13:56 PM

The SOX has come all the way up to retest the H&S neckline.

Jeff Bailey : 1/26/2005 12:13:34 PM

S&P 100 Index (OEX.X) 562.00 +0.38% ... gets a little bounce after session low of 561.12 and slight undercut of WEEKLY Pivot (561.32)

Jonathan Levinson : 1/26/2005 12:12:46 PM

Ten year treasuries continue to rise, TNX now down 2 bps at 4.169% and heading for a retest of 4.16% support. Hold remains firm, up 4.5 at 426.90 with HUI +1.09% at 203.29.

Jeff Bailey : 1/26/2005 12:12:15 PM

12:00 Internals at this Link

Linda Piazza : 1/26/2005 12:06:33 PM

There's no more follow-through to the downside than there has been to the upside. On the SOX, for example, there was a confirmed H&S, a retest of the H&S and then a new LOD. What more could a bear ask to see? Follow-through. The SOX is now back above that LOD, perhaps establishing a descending regression channel on the three-minute chart. When we see a tight pattern of lower highs and lower lows after a climb, we have to suspect a possible bull flag, so if the SOX doesn't follow-through with a precipitous drop, bears are going to need to worry that the H&S has resolved into a bull flag.

Jeff Bailey : 1/26/2005 12:03:30 PM

12:00 Market Watch at this Link

Jeff Bailey : 1/26/2005 11:56:36 AM

Sell Program Premium ... SPX.X 1,171.12, QQQQ $36.85, DIA $104.84

Jonathan Levinson : 1/26/2005 11:52:59 AM

QQQQ is printing new lows here as ten year treasuries print new highs. 30 min channel support has fallen to 36.77, and the 60 min channel is beginning to tick lower, support down to 36.8. That negative bias should continue below QQQQ 36.95.

Linda Piazza : 1/26/2005 11:50:11 AM

The SOX dipped to a new LOD, but is trying to bounce now. Not particularly successfully just yet.

Jeff Bailey : 1/26/2005 11:49:14 AM

TRIN 1.13 +34.52% ... still edging higher above 1.0

Linda Piazza : 1/26/2005 11:48:12 AM

The SOX's high of the day has been 387.68, with the SOX currently at 395.36. But was this a H&S that confirmed earlier, with the neckline being tested now? Link

Jeff Bailey : 1/26/2005 11:45:15 AM

March Unleaded (hu05h) 1.3640 +0.33% (30-minute delayed) ... has been bumping up against WEEKLY R2 ($1.3680).

Spiked to session high of 1.3730 just after 10:30 AM inventory report.

Jeff Bailey : 1/26/2005 11:48:31 AM

March Crude Oil (cl05h) $49.28 -0.73% ... gets a bounce from session low of $48.70 and the conventional (BLUE) 38.2% retracement.

Futures still holding a BULLISH bias.

Unless it gives up that level, have to think SPX 1,175 a major point of resistance.

Linda Piazza : 1/26/2005 11:32:32 AM

The OEX now tests 15-minute Keltner support. The interpretation of its top trendline of the broadening formation as a neckline for a possible inverse H&S now looks a little less likely. While it's not impossible for prices to pull back into a second right shoulder, this formation is dragging out a bit in time. Bulls need to get this confirmed and the OEX safely above its 30-minute 100/130-ema's or weaker bulls are going to lose faith and bail.

Jeff Bailey : 1/26/2005 11:28:38 AM

S&P 500 Index (SPX.X) 1,172.00 +0.31% ... session high of 1,175.68 fell shy of its WEEKLY Pivot (1,177.15).

Same for SPY and session high of 117.50.

Jonathan Levinson : 1/26/2005 11:27:18 AM

QQQQ is now testing the previous low. While I expect more net sideways action as the 60 minute cycle continues to form its top, a failure below 36.87 should target the 36.82 30-min channel bottom and speed the intraday bearish rollover.

Jeff Bailey : 1/26/2005 11:26:57 AM

S&P 100 (OEX.X) 561.54 +0.29% ... after session high of 563.54, comes back to session low and sets up for test of WEEKLY Pivot (561.32)

Linda Piazza : 1/26/2005 11:26:01 AM

The TRAN just hit a new LOD a few minutes ago. It's got the 100-ema at 3509 to provide potential support.

Linda Piazza : 1/26/2005 11:22:44 AM

The TRAN heads back toward its day's low again.

Linda Piazza : 1/26/2005 11:18:50 AM

The OEX heads down to test the Keltner support that had been trying to converge on the chart linked to my 11:06 post. That Keltner support is now strongest from 561.30-561.75, but there's light support at the current OEX level, too. The 15-minute OEX candles continue to show upper shadows or other signs of indecision.

Jeff Bailey : 1/26/2005 11:18:02 AM

11:00 Internals at this Link

Jonathan Levinson : 1/26/2005 11:10:37 AM

QQQQ backed down from the previous high and is now down a dime from its print of 37.08. The rejection at the high is as steep as the bounce that preceded it. The 30 min cycle is chopping sideways within the still rising 60 min cycle. A sideways drift here should coincide with the 60 min channel topping out, provided that the current high doesn't get exceeded by much or for long.

Jeff Bailey : 1/26/2005 11:07:06 AM

TRIN 1.05 +25% ... high of day.

Jeff Bailey : 1/26/2005 11:06:39 AM

Sell Program Premium .... SPX.X 1,174.73, QQQQ $37.03, DIA $105.10

Linda Piazza : 1/26/2005 11:06:20 AM

A 15-minute OEX Keltner chart: Link

Jeff Bailey : 1/26/2005 11:04:52 AM

11:00 Market Watch Link

Jonathan Levinson : 1/26/2005 11:04:12 AM

A steep bounce is printing here from the latest dip to 36.95. Current session high of 37.09 is 4 cents away, with QQQQ just breaking back above rising 7200 tick resistance.

Jeff Bailey : 1/26/2005 11:01:05 AM

Sell Program Premium .... SPX 1,174.39, QQQQ $36.95, DIA $105.12

Jeff Bailey : 1/26/2005 11:00:14 AM

3M (MMM) $83.82 +1.21% ... makes its way back up into "zone of resistance" from $83.80-$84.97. Link

Jonathan Levinson : 1/26/2005 10:56:26 AM

QQQQ is testing 37.00 from below here.

Linda Piazza : 1/26/2005 10:55:27 AM

The TRAN isn't going to give us any clues, either. It's wiggling around above 3520. The chart has a little of the look of a bearish right triangle, with lower highs, but there's nothing definitive there yet.

Jonathan Levinson : 1/26/2005 10:52:02 AM

QQQQ bulls need to clear 37.00 to prevent the 30 min cycle channel from rolling over here- the upper channel band has already begun to tick down, currently at at 37.11, with support declining 3 cents to 36.85.

Jonathan Levinson : 1/26/2005 10:50:12 AM

Headline:

10:48am BUSH ENDS PRESS CONFERENCE

Jeff Bailey : 1/26/2005 10:47:29 AM

Oshkosh Truck (OSK) $72.66 +3.39% ... builds on yesterday's gains.

Jeff Bailey : 1/26/2005 11:32:44 AM

Swing trade call option alert ... for Yellow Roadway (YELL) .... taking three (3) of the YELL Feb. $55 calls (YUX-BK) at the offer of $1.05.

YELL $52.25 -0.28% .... targeting $60.00.

Linda Piazza : 1/26/2005 10:45:06 AM

There's a lot of uncertainty still in the market, typified in the OEX by four 15-minute candles all indicating uncertainty--small real bodies, upper or lower shadows, etc. Studying the 15-minute Keltner chart, 563.70-564.00 looks like next resistance, with support trying to firm from 560.75-562.00 and with some uncertainty as to which is stronger on that chart.

Jeff Bailey : 1/26/2005 10:44:22 AM

March Crude Oil futures (cl05h) $48.80 $-0.84. Gives back yesterday's $+0.83 gain.

Jeff Bailey : 1/26/2005 10:43:02 AM

Energy futures spiked higher on inventory reports, but have started to abate.

Jonathan Levinson : 1/26/2005 10:42:10 AM

Session high for Feb. gold here at 427.30 on strong volume of 1618 e-mini contracts.

Jeff Bailey : 1/26/2005 10:42:03 AM

Sector weakness ... Oil Service -0.71%, Natural Gas -0.28%, Brokers -0.14%

Linda Piazza : 1/26/2005 10:41:15 AM

Still watching the TRAN as a sensitive early indicator to both crude prices and economic developments. It's managing to hold above its low of the day, but only barely.

Jonathan Levinson : 1/26/2005 10:40:08 AM

Crude oil is down 1.41% here at 48.95. Current high 49.70, low 48.825.

Linda Piazza : 1/26/2005 10:37:13 AM

The TRAN approaches its low of the day.

Jonathan Levinson : 1/26/2005 10:34:32 AM

Headlines:

10:32am U.S. CRUDE STK UP 3.4 MLN BRLS LAST WK: ENERGY DEPT

10:32am U.S. DISTILLATE STK DOWN 2.3 MLN BRLS: ENERGY DEPT

10:32am U.S. GASOLINE STK DOWN 2.3 MLN BRLS: ENERGY DEPT

Linda Piazza : 1/26/2005 10:32:57 AM

Remember crude inventories this morning. Looking for numbers.

Jeff Bailey : 1/26/2005 10:31:48 AM

Sell Program Premium ... SPX 1,173.51 , QQQQ $36.94

Jonathan Levinson : 1/26/2005 10:31:47 AM

QQQQ is breaking 35.95 support, breaking the previous low. 30 min channel support is up to 36.88 currently, but that level will begin to drop in 5-10 minutes if QQQQ holds below 36.95.

Linda Piazza : 1/26/2005 10:31:49 AM

Seeing upper shadows again on the 15-minute OEX candles. I don't like not having suggested that readers participate in yesterday's gains, but I also don't like the whole uncertainty of the behavior seen on the 15-minute chart, punctuated by those upper shadows. It's beginning to look to me as if the OEX is narrowing its range as it climbs now, a rising wedge that's still broad and so still might have some climbing to do. A rising wedge climb is not a healthy climb, though, but climb it does. I'm not certain about the shape, but within that broadening formation, the OEX has obviously spent more time testing the upside since yesterday morning than the downside, and it's the rise from yesterday's low that's beginning to take on that rising wedge. Both it and the broadening formation have the same topside line.

Tab Gilles : 1/26/2005 10:28:25 AM

$SPX/$VIX 60 minute and daily charts. Link Link

Jonathan Levinson : 1/26/2005 10:28:14 AM

The Fed's open market desk has announced an overnight repo of 7.25B, for a generous net add of 6.25B for the day.

Jeff Bailey : 1/26/2005 10:24:08 AM

Current OPEN MM Profiles at this Link

Linda Piazza : 1/26/2005 10:23:31 AM

I've changed to a three-minute Keltner chart, trying to get a better short-term view on the OEX. There's not a lot of information there, except that the OEX needs to maintain levels near this morning's high, because support thins below current levels.

Jeff Bailey : 1/26/2005 10:19:01 AM

VIX.X 13.18 -6.25% ... plunging

Jonathan Levinson : 1/26/2005 10:18:52 AM

Session high with ES futures testing 1176 and QQQQ just below the current 37.09 high. 37.10 is first confluence resistance, with the 30 min channel top now stabilizing at 37.15.

Linda Piazza : 1/26/2005 10:16:41 AM

The OEX still tests its 30-minute 100/130-ema's at 562.76 and 563.55, respectively. It hasn't yet touched the top of its broadening formation. The advdec line had headed higher again and pauses now.

Linda Piazza : 1/26/2005 10:13:08 AM

The TRAN undid its H&S confirmation. It's back above the neckline again . . . unless it's forming a different H&S and I had my neckline drawn wrong. Watch how it behaves just above 3540 to see whether it keeps moving higher or rolls down.

Jeff Bailey : 1/26/2005 10:12:10 AM

10:00 Internals at this Link

Jonathan Levinson : 1/26/2005 10:05:31 AM

Headline:

10:04am BUSH URGES CONGRESS TO ACT SOON ON SOCIAL SECURITY

Jonathan Levinson : 1/26/2005 10:04:36 AM

Session highs across the board, QQQQ at 37.04. 30 min channel resistance has risen into the 37.10-.20 confluence, currently up to 37.17.

Jeff Bailey : 1/26/2005 10:02:43 AM

10:00 Market Watch at this Link

Linda Piazza : 1/26/2005 10:03:55 AM

Here's where the OEX is on an old chart, with some old support and resistance levels marked, with the original annotations: Link If the OEX can break past this resistance and sustain those levels (I'll need to see it above the broadening formation and 30-minute 100/130-ema's before I'm confident that's occurring), it looks possible for it to climb toward 566-568, but that still looks as if it's within a potential right-shoulder level. Until proven otherwise, it looks like a countertrend move.

Jonathan Levinson : 1/26/2005 10:01:00 AM

The president is about to commence the 10AM press conference. It can be viewed live on the internet on Cspan3.

Linda Piazza : 1/26/2005 9:59:52 AM

The TRAN is pulling up again ahead of 3520.

Jeff Bailey : 1/26/2005 9:59:25 AM

VIX.X 13.54 -3.69% .... Daily Pivot Levels ... 13.67, 13.88, Piv= 14.08, 14.29, 14.49.

Noting correlative matrix support at DAILY S2 and WEEKLY Pivot has been violated. Call buyers/put sellers picking up their activity.

Jonathan Levinson : 1/26/2005 9:57:34 AM

The Fed has 5.5B in expiring repos today and has just announced a 4.5B 7-day repo. This results in a net drain of 1B, though it's still possible that the desk will announce an overnight repo in the next few minutes. I'll post an update should that occur.

Linda Piazza : 1/26/2005 9:55:43 AM

Careful, bulls. Looks to me as if the TRAN may have confirmed this H&S: Link

Linda Piazza : 1/26/2005 9:53:26 AM

The advdec line begins keeling over again . . . we could just recycle yesterday's comments, so far.

Linda Piazza : 1/26/2005 9:49:11 AM

Does anyone else feel as if they're repeating all the things said yesterday morning? So far, the OEX holds near the high of the day, but so far, resistance, holds, too. One form of that resistance is historical resistance but is also the 30-minute 100-ema at 562.75.

Linda Piazza : 1/26/2005 9:44:03 AM

So far, the OEX still pushes toward the top of the broadening formation, also serving as the neckline for a possible inverse H&S. In fact, there are two versions of inverse H&S's, one visible on the 15-minute chart, with that version the right shoulder for a larger inverse H&S. I'm watching the 30-minute 100/130-ema's, with those averages near the neckline for the larger inverse H&S. They're at 562.76 and 563.56, respectively, and I think the OEX would need a thrust above both before we could consider that larger inverse H&S truly confirmed.

Jeff Bailey : 1/26/2005 9:45:45 AM

SanDisk (SNDK) $21.20 -5.7% .... little bounce underway.

earnings have been mixed among flash and SNDK hasn't said a thing (positive or negative).

Jonathan Levinson : 1/26/2005 9:45:50 AM

Gold is just off its 426.8 high, trading up 3.5 at 425.90 currently with HUI +1.53% at 204.17 and XAU +1.35% at 93.02. Ten year treasuries have flipped back to negative territory, TNX +.7 bps at 4.192%.

Jeff Bailey : 1/26/2005 10:30:06 AM

Day trade short close out alert ... for Southwest Air (LUV) at the offer of $14.28. ($+0.05, or +0.35%)

Jonathan Levinson : 1/26/2005 9:39:21 AM

Here's the pullback to the upper 30 min channel top at 35.95. Bears need to get back below 36.90 to stall the current upside reversal, while a move below 7200 tick SMA support at 36.80 would begin generating 30 min cycle downticks. To the upside, 37.10 remains the number to beat.

Jeff Bailey : 1/26/2005 10:29:37 AM

Covered call close out alert ... With SanDisk (SNDK) $21.00 -6.53% getting hit lower, I want to CLOSE out/buy back the one (1) SNDK Feb. $27.5 Call (SWQ-BY) at the offer of $0.10. ($+1.05, or +1,050%)

Linda Piazza : 1/26/2005 9:38:16 AM

On the first morning push, the OEX broke fairly easily through Keltner resistance mentioned in my 9:27 post. We still have a while before the first 15-minute period closes, and bulls want to see a close above that resistance, now near 561-561.63.

The top of the broadening formation is now at about 564.

Jonathan Levinson : 1/26/2005 9:37:33 AM

WASHINGTON (AP) -- All of the people killed in the crash of a U.S. Marine helicopter in western Iraq are believed to be U.S. Marines, a senior administration official said Wednesday. It was the deadliest crash of a U.S. military helicopter in Iraq. Link

Jeff Bailey : 1/26/2005 9:36:21 AM

Southwest Air (LUV) indicating $14.36

Jeff Bailey : 1/26/2005 9:34:59 AM

Murphy Oil (MUR) $83.53 ... delayed opening.

Jonathan Levinson : 1/26/2005 9:34:53 AM

Like yesterday, QQQQ's holding its gap up open, cracking 37.00 resistance as I type. It's currently above 5 cents above upper 30 min channel resistance, and if it doesn't fail within the next 10 minutes, will suggest another upside trending move in the 30 min cycle.

Jeff Bailey : 1/26/2005 9:34:11 AM

Southwest Air (LUV) $14.25 ... delayed opening.

Linda Piazza : 1/26/2005 9:33:51 AM

The OEX opens and climbs right back to the resistance zone from yesterday, giving it another try.

Linda Piazza : 1/26/2005 9:33:14 AM

I note a reference that President Bush will be holding a press conference at 10:00. I don't see a topic listed.

Linda Piazza : 1/26/2005 9:27:57 AM

Futures are higher this morning, despite tentativeness in European trading, but nothing I see here radically changes my outlook for the day, that trading might be particularly dangerous while the OEX is within that broadening formation. I was reading the outlook of one currency market guru this morning, and his service has decided to stay in cash until after the Iraqi elections, as there's just too much uncertainty in that market. He's basing his decision on fundamentals: I'm basing my outlook on chart formations. Both show the possibility for some uncertainty. Here's my post from last night for those who did not read it before it was archived:

The OEX closed Tuesday at the midpoint of its 6.5-point range. That's an equivocal ending. An ambiguous one. An unclear one. Add to that the fact that the OEX trades within a broadening formation visible on the 15-minute chart, testing the top trendline several times today before falling away, and within yet-another potential right-shoulder level for yet-another H&S on the daily chart, and the ambiguity grows. About all we can say about Tuesday's trading is that 557-ish support held and 563-ish resistance did, too. Actually on a daily closing basis, the 560.80-561.60 resistance held.

As I said near the close of the trading day Tuesday, nothing has been decided, in my opinion. The 15-minute Keltner chart shows that unless the OEX can maintain 15-minute closes above the Keltner line currently at 560.74 and preferably above the one currently at 561.76, it looks vulnerable down to 558.29, and perhaps even to 555.31, where Keltner support coincides with the support of the broadening formation. Fifteen-minute closes above 561.76 suggest that a higher target, 563.19-564.00 might be reached. Today, the OEX came within $0.21 of the Keltner upper target on this chart, so the Keltner lines here are showing some relevance.

Tomorrow might be particularly difficult to trade. I think we may have just had an oversold bounce today, one that met with selling when the institutional players came into the market near the close. That action reinforced my distrust of long plays right now while the OEX could just be building another right shoulder. I think the time is approaching when long plays will be right, but I'm just not sure that now is that time. I'm not sure that there's not a lower low in the making for the OEX, a low near 550-552. I'll watch carefully for the possibility that continued pushes up toward 562-563 might be opportunities for new bearish plays, but even here I'll be careful and may miss a play setup. Players need as much confirmation as possible while the OEX remains within that broadening formation. The very nature of that formation shows that stops keep getting run only to see the index immediately reverse. I wouldn't want to have just suggested entering a new bearish play when a new stop-run ensued. Breakouts above the 563-ish resistance might send the OEX all the way up toward 567-568, one appropriate level for the top of a right shoulder.

Jeff Bailey : 1/26/2005 9:26:41 AM

Pre-market most actives ... SIRI $5.88 -5.7%, ORCL $13.99 +2.9%, CSCO $17.78 +1.4%, INSP $45.00 +20.7%

Jonathan Levinson : 1/26/2005 9:17:58 AM

Session high for ten year bonds here at 111 31/32, with TNX -.8 bps at 4.141%.

Jeff Bailey : 1/26/2005 9:16:25 AM

Program trading levels ... HL Camp & Company has their computers set for program buying at $+1.76 and set for program selling at $-0.16.

Jonathan Levinson : 1/26/2005 8:35:10 AM

Session high for gold and silver here. QQQQ never broke the 36.99 high, currently down to a 25 cent gain at 36.96.

Jonathan Levinson : 1/26/2005 8:03:07 AM

Session highs for Nasdaq and R2K futures, with QQQQ hitting a high as I type at 36.99. 37.00 is first resistance, 37.10 yesterday's high and the start of confluence to 37.20. Based on my reading of the daily chart, a close above 37.40 would most likely kick off the overdue daily cycle upphase for QQQQ.

Jonathan Levinson : 1/26/2005 7:46:51 AM

Equities are higher, ES trading 1173, NQ 1503, YM 10498 and QQQQ +.23 to 36.94. Gold is up .90 to 423.3, silver +.064 to 6.759, and ten year notes are down .1562 to 111 51/64. Crude oil is down .375 to 49.275.

There are no major economic reports scheduled for today.

Linda Piazza : 1/26/2005 6:56:51 AM

Good morning. The overnight session produced many economic releases, including Japan's trade surplus, the U.K.'s GDP, and Germany's Ifo Institute number, with Japan's number showing a troubling decline in exports. Despite that news, the Nikkei gained 0.88%. Other Asian markets moved higher, too, except for China's. European markets trade cautiously, however, not able to hold onto early highs. Our futures flat-lined, displayed the usual volatility near the European open, and now are modestly higher. As of 6:40 EST, gold was up $1.40, and crude, down $0.31 to $49.33. More detail about Asian and European markets follows in succeeding paragraphs.

Last night, Japan's Ministry of Finance released figures showing that the trade surplus increased 1.8% as exports grew 8.8% from the year-ago level, and imports, 10.9%. December's exports declined 5.6% from November's, and imports, 6%. Economists and analysts mentioned yen strength as impacting those exports and crude price strength as impacting imports. Despite that news, yesterday's strength in the dollar against the yen helped Japanese exporters in early trading. The Nikkei gapped higher and climbed, then flat-lined near the high of the day, perhaps flat-lining as that dollar strength ebbed somewhat. It closed higher by 99.66 points or 0.88%, at 11,376.57. Many car manufacturers gained, although Mitsubishi Motors wasn't one gaining. It dropped ahead of its earnings report.

Most other Asian markets closed higher, too, as investors viewed TXN's earnings announcement in a positive light. Chip-related stocks tended to gain. The Taiwan Weighted gained 0.91%, and South Korea's Kospi climbed 1.30%. Singapore's Straits Times rose 1.03%, and Hong Kong's Hang Seng gained 0.29%. China's Shanghai Composite was the only Asia bourse to decline, dropping 0.98%.

European markets currently trade cautiously either side of the flat-line, reacting to earnings reports and economic releases. In the U.K., the National Statistics Office announced that Q4 GDP grew 0.7%, more than the expected 0.6%. Preliminary estimates for 2004 were for a 3.1% growth. Growth in the services industry was touted for the higher-than-expected growth, with the picture looking different in the production industries where the volume of output slipped 0.5%.

Also in Europe, Germany's Ifo report measured 96.4, slightly higher than the expected 96.2. Some had feared the number would decline. The Ifo Institute credits stronger domestic demand, with the exports expectations weakening somewhat, echoing information yesterday when the German government lowered estimates for that country's 2005 economic growth. The government had reported that exports did not increase as much as expected. The expectations component of the Ifo climbed to 97.6 from a revised-higher 96.5. The business conditions index declined.

Investors showed disappointment with Germany's SAP's outlook on margins. Also weighing on market sentiment was an announcement by German insurer Allianz that it would reduce its exposure to equities. In France, Danone dropped after announcing that it would take a hefty charge. Although Asia car makers tended to climb despite climbing crude prices, European car makers did not follow that trend and eased. Drugmaker Sanofi-Aventis and other companies received better receptions after their earnings reports, at least in earliest trading, but indices weren't able to hold onto early gains.

As of 6:40 EST, the FTSE 100 traded 0.90 points or 0.02% higher, at 4,844.10. The CAC 40 traded 1.43 points or 0.04% lower, at 3,880.61. The DAX had slipped 0.65 points or 0.02%, to 4,233.30.

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