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OI Technical Staff : 3/23/2005 9:59:59 PM

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Jeff Bailey : 3/23/2005 9:38:56 PM

June Crude (cl05m) $54.51 is now down 23 cents and resting on 61.8% retracement. Speaking of rest... I think I'll get some. See you in the morning!

Jeff Bailey : 3/23/2005 9:47:00 PM

Tab ... no I didn't catch Mr. Cramer tonight. I had some meetings I had to attend. But.... I would have to agree with Mr. Cramer on the "overdone." (Hey... when you're buying PHF at $9.16 and it's trading $8.72, what am I supposed to think/say?) Thus some focus today on junk bonds and PHF. We shall see. I contemplated closing out my MRK short with the covered puts, but thought I'd take a wait and see approach. I would think today's gains in PFE was "safety," but that might end up being an unpleasant surprise. Hey.... did you ever talk to your Doctor about PFE and our e-mail discussions?

Jeff Bailey : 3/23/2005 9:25:06 PM

Tab ... that (AMEX: EVV) looks like a pretty good General Bond Inv. Grade closed end fund. For those interested, here's a fact sheet Link Here's the fact sheet on PHF at this Link Several months ago I had made SPECIAL NOTE that the PHF was trading at a PREMIUM. Now it trades at a DISCOUNT. This "fluctuation" is common among closed-end funds, but why they can be useful in market analysis. Why? Here's a discussion on premium/discount. It revolves around GREED and FEAR! Link Bonds are fascinating to me. They can say so much about the market/economy.

Tab Gilles : 3/23/2005 9:03:05 PM

Jeff, Not sure if you caught Cramer tonight on "Madmoney". But, he stated that PFE, MRK and BMY were up on fears of a recession and that the brokers would be touting the drug sector as a buy tomorrow. He went on the record as saying that the market over reacted to the Fed's move and that instead of buying the drugs investors should instead buy DD, DOW, CHV and XOM....(basically XLB). I happened to look at that chart after I posted the $INDU in response to your question. Here's what I came up with. Link

XLB chart from the 3/16 post... Link

Those not familiar with XLB holdings... Link

Jeff Bailey : 3/23/2005 8:35:40 PM

Tab ... no, it was the Materials Select Sector SPDR (XLB) from 3/16/2005 04:26:59.

Jeff Bailey : 3/23/2005 5:32:51 PM

Dow Diamonds (DIA) ... most active options for today and quick look at what happened with Open Interest from yesterday's trade for yesterday's "top 5" most actives. Will have to think about this over dinner, but almost get the feel that at these higher levels of VIX.X (traded WEEKLY R2/MONTHLY R2 today then eased off) we might need to be alert to put selling and call buying. Why did open interest decline with regard to YESTERDAY's trade in the April $108 Puts (DIA-PD) when they jumped intra-day from #7 to #1. It could be a BULL that had sold to OPEN naked changed his/her mind based on Fed wording, and CLOSED out that position. Here's today's option chain at this Link

Jeff Bailey : 3/23/2005 5:05:03 PM

Pivot Matrix for tomorrow at this Link

Tab Gilles : 3/23/2005 5:02:55 PM

Pacholder High Yield (PHF) Annotated chart. Link

Tab Gilles : 3/23/2005 4:49:35 PM

Jeff, If you are refering to the $INDU chart from 3/16, I'm reposting it along with an updated chart. Link Link

On this chart of the $INDU using 150 and 200-ema note that along with MACD & RSI now maybe an opportune time to enter a long position. Link

As for PHF...I've followed the Eaton Vance Limited Duration (EVV) pays about the same rate, but is more conservative and less volatile. It ladders its portfolio as rates rise. Link

Jeff Bailey : 3/23/2005 4:44:17 PM

NYMEX had May Crude Oil (cl05k) settling at $53.81, trading up $0.50 at $54.31. June Crude (cl05m) settling at $54.74, trading up $0.49 at $55.23.

Jeff Bailey : 3/23/2005 4:31:58 PM

Closing Internals at this Link for fourth-straight session, NYSE well above that at the NASDAQ (more institutional trading taking place) and A/D line, as well as NH/NL at the big board is UGLY.

Jeff Bailey : 3/23/2005 4:22:10 PM

Closing U.S. Market Watch at this Link

Jeff Bailey : 3/23/2005 4:12:00 PM

Hey Tab .... how is that "industrial" chart looking that you were showing the other night? I might be able to use that with the PHF in the next couple of weeks.

Tab Gilles : 3/23/2005 4:07:40 PM

Russell 200 small Cap ($RUT) A look at 2 three year charts.

LOG Link

Linear Link

Jeff Bailey : 3/23/2005 4:05:39 PM

Current OPEN MM Profiles that I've made at this Link Today's Activity ... I did not profile any trades today.

Jonathan Levinson : 3/23/2005 4:03:18 PM

IB reports a spike down to 36.12 on this plunge, but it dojied back up to 36.25 and might have been a bad tick for QQQQ. The surge of volume suggests that it was the real deal. Link

Jeff Bailey : 3/23/2005 3:58:48 PM

Altair Nanotech (ALTI) $4.30 +0.7% ... pretty good burst of volume (150,000 shares) 5-minutes ago. Stock isn't moving.

Jeff Bailey : 3/23/2005 3:51:09 PM

Starbucks (SBUX) $51.61 -0.09% ... looked like bulls were going to spit out the hot brew this morning as the stock approached its rising 200-day SMA ($50.50) earlier this morning.

Linda Piazza : 3/23/2005 3:49:27 PM

I don't know if anyone has said anything lately, but I did want to remind readers planning trades or currently in trades that we have a holiday March 25.

Jeff Bailey : 3/23/2005 3:49:04 PM

Merck (MRK) $32.09 +0.34% ... has given up gains, but off afternoon low of $32.00 even.

Jeff Bailey : 3/23/2005 3:47:45 PM

Pfizer (PFE) $26.03 +2.39% ... pressing session high on heavy volume today. Percentage gainer among DIA $104.70 +0.14% components.

Linda Piazza : 3/23/2005 3:46:19 PM

Not much change since my last post. As I had worried, that sideways trade out of the bear-flag formation did not result in a deep dip, at least not yet. The danger now is that the shallow dip may have encouraged bulls to try to send the OEX higher and that it might try to climb the flag's former support from the underside. This isn't strongly bullish behavior, but bears do need to have their profit-protecting plans in place.

Jeff Bailey : 3/23/2005 3:44:19 PM

Sun Microsystems (SUNW) $4.10 +1.73% ... nice recovery from this NDX/QQQQ component. Brisk volume last 20-minutes.

Jonathan Levinson : 3/23/2005 3:39:41 PM

QQQQ's gyrations appear bearish in view of the repeated failures below 36.50, and the overbought 300 min stochastic is showing a bearish kiss. The daily cycle continues to point south despite today's bullish doji. The premarket lows could well prove to be a low for the daily cycle, but the intraday cycles combined with the overhang at 36.50 suggest a pullback first.

Jeff Bailey : 3/23/2005 3:39:13 PM

BP Plc. (BP) $62.10 -2.23% ... off lows of $61.71 after explosion at its Texas City refinery. The refinery produces approximately 30% of BP's North American supply and 3% of the entire U.S. supply. Its daily output of crude oil stands at 435,000 barrels.

Jeff Bailey : 3/23/2005 3:31:48 PM

Corning (GLW) $10.86 -1.0% ... probing Monday's lows. 5-minute chart intervals show "dojis" at Tuesday's open and another last 10-minutes. One at $10.80, now at $10.84. Has to be one of those two brokers that upgraded the stock defending it don't you think? If they, or their clients break......

Jeff Bailey : 3/23/2005 3:27:03 PM

Newmont Mining (NEM) $42.01 -1.63% Link ... sold those calls a little early, but NEM giving it up here.

Jonathan Levinson : 3/23/2005 3:25:29 PM

30 min channel support has dropped to QQQQ 36.25 here with price holding below 7200 tick SMA resistance 36.40. 36.25 was morning support and has yet to be tested, with price back into the wedge after cracking support 15 minutes ago.

Jeff Bailey : 3/23/2005 3:22:56 PM

Bema Gold (BGO) $2.63 -4.36% ... little gold miner that tends to find bullish speculation when gold stocks are "hot." Was monitoring to see if "right shoulder" of reverse head/shoulder might holds at $2.75. Nope!

Jeff Bailey : 3/23/2005 3:19:32 PM

Applied Materials (AMAT) $16.25 +2.78% .... a major NDX/QQQQ component announced it will offer a stock dividend for the first time in company history. AMAT said it will pay a $0.03 per share quarterly dividend. The dividend will be paid June 8 to stockholders of record May 18. AMAT also announced its board had approved a $4 billion share repurchase, replacing a $3 billion plan that had been about 1/3 exercised.

Jonathan Levinson : 3/23/2005 3:15:06 PM

Session low for April gold at 424.40, HUI-1.37% at 203.35, XAU -1.43% at 94.41.

Jeff Bailey : 3/23/2005 3:10:29 PM

03:00 Internals at this Link

Jonathan Levinson : 3/23/2005 3:09:03 PM

QQQQ's breaking lower rising wedge support on the 100 tick chart: Link . The 30 min channel is ticking lower, and will kick off a downphase failing a bounce back above 36.40 within the next 5-10 minutes.

Jeff Bailey : 3/23/2005 3:02:53 PM

03:00 Market Watch at this Link

Linda Piazza : 3/23/2005 3:00:47 PM

Notice that on this chart, the OEX's climb looks like a bear-flag climb up through this descending regression channel: Link When seen on a 5-minute chart, the OEX has broken below the support of that flag, but the break has been a sideways break, always suspect in my view. Too many of those have been traps, only to see prices move higher again. So, be suspect, but also note a couple of other points from that chart: The OEX is at the midline of that regression channel, a potential resistance area and one that coincides with the 38.2% retracement of the last decline. Also note the 60-minute CCI hooks down just the slightest bit--just as hint of a downturn. Bears want to see that hint turn into something stronger, and they also want to see the OEX break out of this sideways trading pattern to the downside. There's something I just don't quite trust about this sideways break, but it's entirely possible that the OEX will drop to 558.18-558.74 at least.

Jeff Bailey : 3/23/2005 2:59:39 PM

Dow Diamonds (DIA) $104.61 +0.07% ... Here's an updated 30-minute chart of the DIA at this Link

Jeff Bailey : 3/23/2005 2:51:00 PM

Current OPEN MM Profiles that I've made at this Link

Jonathan Levinson : 3/23/2005 2:45:13 PM

Stepping away for 20 minutes.

Jeff Bailey : 3/23/2005 2:42:27 PM

Pacholder High Yield (PHF) $8.70 -1.91% ... here's the CURRENT 30-minute interval chart at this Link This will conclude analysis of PHF, but it was a KEY observation that may have saved some overly bearish traders in May. Now we test. Lots of work for bulls to do at this point. Equity traders will want to understand these dynamics too and continue to test/monitor.

Tab Gilles : 3/23/2005 2:37:04 PM

Semiconductor Holders (SMH) Nice rally today. Link

50% Fib Retrace holding as support as highlighted last Friday. Link

Linda Piazza : 3/23/2005 2:36:45 PM

The BIX has bounced, too, and now challenges 350. Lots of indices near potential resistance levels. The BIX's straight-down decline over six trading sessions, however, suggests that it might have a bigger retracement than this to retrace, but perhaps in the see-sawing, up-one-day-down-the-next pattern of a bear flag. That's still to be decided.

Jonathan Levinson : 3/23/2005 2:36:13 PM

QQQQ 100-tick chart update at this Link

Linda Piazza : 3/23/2005 2:34:29 PM

The SOX remains above its 200-sma, challenging the 50-dma now.

Jeff Bailey : 3/23/2005 2:31:43 PM

Pacholder High Yield (PHF) ... here's 30-minute chart of PHF dating back to May-June of 2004. Same chart shown at 02:21:47, but now zooming in on 30-minutes. Chart at this Link . I'll follow with a "this is now" chart in a minute.

Jonathan Levinson : 3/23/2005 2:29:01 PM

AMAT has announced board approval of a stock buyback program of up to 4B to end in March 2008. As well, a quarterly dividend of 3 cents per share will be paid on June 8 to shareholders of record on May 18.

Jeff Bailey : 3/23/2005 2:21:47 PM

Pacholder High Yield (PHF) $8.75 -1.35% ... here a DAILY Interval bar chart that I've been using since May of last year. Noting past entry points and exit points. Positive implications here at $8.75. Link

Tab Gilles : 3/23/2005 2:22:54 PM

GOLD & EUR/USD As posted this morning (1:09 AM)...watch the Fibonacci retracement level of 1.2968 for near term support. Getting a bounce there. Still targeting $420 on $GOLD or 42 on GLD as a downside target. Need we forget that Korea, China and Japan talk of diversifying into other currencies, or Buffet and Gates corncen of US deficit and a lower dollar? I believe that the CPI core is temporary, due in part to oil and commodities. And like Jim Brown's comments that oil will be pulling back short term, I back that outlook. Even today's EIA report that crude capacity is up. I see the CPI coming down in coming months and the dollar continuing it's decline.

Those that follow my posts will recall my call for a "Double Top" on the $WTIC back on 3/10 (4:02 PM post) Also. my call on MUR Murphy Oil 3/20 11:10PM post.

The Material Select Sector XLB is nearing a BUY as mentioned on chart posted 3/16 4:26 PM.

Link of the daily EUR/USD chart, but as I'm typing, it is now retesing lows of the day again @ 1.2968. Link GLD Link

Jeff Bailey : 3/23/2005 2:19:33 PM

02:00 Internals at this Link

Linda Piazza : 3/23/2005 2:17:31 PM

The OEX currently tests the 38.2% retracement of the plunge that immediately preceded the climb. The flag that it's been forming as it climbs has support at about 559.60, so that a breakdown below that constitutes a breakdown out of the flag. I have some qualms about acting on that breakdown, however, if it should occur. Today's low was nearly Keltner support on the daily chart, and on the 15-minute one, support is trying to firm from 558.36-558.88. I'd watch the advdec line, too, and would want to see a break of the advdec's ascending trendline off the day's low, too, to corroborate OEX support break. At the least.

Jeff Bailey : 3/23/2005 2:15:42 PM

Dow Diamonds (DIA) $104.74 +0.20% ... reclaimed WEEKLY S1 for 15 minutes. Let's see if bulls can't show a little conviction and get a kick back higher here. PHF $8.71 -1.8% ...

Jonathan Levinson : 3/23/2005 2:12:49 PM

TNX is creeping back higher, currently up 1.5 bps at 4.625% as crude oil holds just above the lows, still down an impressive 2.35 or 4.19%. QQQQ is chopping along below rising trendline and horizontal confluence resistance at 36.50- conveniently, the 30 and 60 min cycle channel tops are at that level too. Link

Jeff Bailey : 3/23/2005 2:06:44 PM

02:00 Market Watch at this Link

Jonathan Levinson : 3/23/2005 1:51:03 PM

The QQQQ 36.40 line, even the 36.40-.45 band, is simply not behaving as a reverse h&s neckline should. The 36.50 overhang appears to be squelching any bullishness below it. Link

Jonathan Levinson : 3/23/2005 1:37:58 PM

QQQQ 100-tick chart update at this Link with price dipping below the 7200 tick SMA as the 30 min channel flattens.

Jeff Bailey : 3/23/2005 1:40:50 PM

Here he comes .... Pacholder High Yield (PFH) $8.69 -2.02% .... If you have a charting system that allows you to look at 30-minute intervals, go back and look at May of last year. I'll follow with my chart in a minute, but PHF may get a bounce to $9.00. Use 21, 50 and 200-pd SMAs. Let's face it. When I bought 1,000 shares the other day (3/17/05) at $9.16, I gave somebody smarter than me an up-tick.

Jonathan Levinson : 3/23/2005 1:25:10 PM

TNX edges lower toward unchanged and daily gravestone doji territory, currently up just .9 bps at 4.619%. Link

Linda Piazza : 3/23/2005 1:19:58 PM

The OEX has stabilized long enough that 15-minute Keltner lines have snaked below it, now looking like relatively strong support, from 558.40-559.30. Watch the 560.50-ish level that's the 38.2% retracement of the last plummet and the 561.60-ish level that's the 50% retracement. If the OEX gets past those and especially if it gets past the 61.8% retracement up near 562.70, something more bullish than a mere retracement of the last plummet might be going on. The OEX might be "fixin to," as President Bush might say (as a Texan, I can say that, too), retrace a bigger drop than that last plummet.

Jeff Bailey : 3/23/2005 1:12:00 PM

01:00 Internals at this Link

Jonathan Levinson : 3/23/2005 1:05:34 PM

Zooming out, today's bounce looks like a "b" distribution/bear flag bounce for QQQQ. If the daily cycle oscillator wasn't approaching the bottom of its range, I'd be more skeptical of the bounce than I am. The 30 min cycle upphase continues to hold, but the 60 min is lagging, and until the daily cycle actually turns up, the intraday bounce will remain countertrend. The 36.40-.45 intraday top zone remains key, but I suspect that part of the hesitation is the overhang at 36.50 from yesterday's pre-FOMC range. Link

Jeff Bailey : 3/23/2005 1:03:32 PM

01:00 Market Watch at this Link

Jonathan Levinson : 3/23/2005 12:55:45 PM

QQQQ 100-tick chart update at this Link

Jeff Bailey : 3/23/2005 12:55:24 PM

Crude Oil analysis ... a settlement below $54.51 today will have momentum bulls assessing downside to $51.96. Further pullback in oil could give slight bid back to Treasury bonds, which we do see in the longer-dated 30-year ($TYX.X) with yield now down 1.8 basis points at 4.873%. However, I would think for meaningful equity rally to take place (lower oil, inflation fear subside in Treasury market) then "junk bonds" should be doing better than they are right now. Pacholder High Yield (PHF) $8.61 -2.93%

Jeff Bailey : 3/23/2005 12:51:05 PM

The time stamp comparison between June Crude Oil trade at my 61.8% retracement ($54.51) is pretty darned close to when that "buy program" premium was generated. Gives me a feel that my retracement is in play. What do you think? 5-minute interval chart at this Link

Jonathan Levinson : 3/23/2005 12:48:13 PM

The US Dollar Index remains very strong in its bullish daily divergent upphase. 84 resistance is being tested now, above which next confluence is at 85.30-.40. Link

Jeff Bailey : 3/23/2005 12:39:02 PM

Airline Index (XAL.X) 48.45 +2.1% ... late last night (see bottom of today's MM) I alerted traders to possible reversal in oil. Airlines have been holding tough last four weeks. Link Linda has commented for months how strong the Dow Transports (TRAN) have been (trucking, railroad), and it may be that the XAL.X is best representer of "oil/fuel" relationship.

Jonathan Levinson : 3/23/2005 12:36:53 PM

TNX continues to edge its way lower, now up 1.3 bps at 4.624%. Lower yields and lower oil should be weights off the equity indices, but the Dow industrials remain red here, the SPX and COMPX barely positive.

Jeff Bailey : 3/23/2005 12:32:08 PM

June Crude (cl05m) $54.40 -4.09% (30-minute delayed) ... slips below the 61.8% "fitted retracement". When was that "buy program premium?"

Jonathan Levinson : 3/23/2005 12:28:57 PM

QQQQ 100 tick update at this Link

Jonathan Levinson : 3/23/2005 12:21:18 PM

Crude oil is down 4.15% here to 53.70, off a session low of 53.425.

Linda Piazza : 3/23/2005 12:22:06 PM

The OEX still climbs in a measured distribution form toward a 38.2% retracement of the plunge that immediately preceded the climb. Bears looking for a new entry would want to see a breakdown before the 50% retracement, preferably. I warn, though, that the daily Keltner support is near the day's low, so anyone considering a bearish entry should be forewarned to protect profits near today's low. I'm not able to watch moment-by-moment developments today, and so would likely not be viewing the markets at any breakdown level out of the flag and judge whether it looked likely to carry far.

Jeff Bailey : 3/23/2005 12:14:21 PM

12:00 Internals at this Link

Jeff Bailey : 3/23/2005 12:12:28 PM

Just a little one, or so it looks.

Jeff Bailey : 3/23/2005 12:11:55 PM

Buy Program Premium ... SPX 1,174.15, DIA $104.69, QQQQ $36.43.

Marc Eckelberry : 3/23/2005 12:22:16 PM

We were stopped out of LU at 2.69, of course now back up and MSFT as well, but it has been a crazy couple of days. If you don't follow the futures side, be aware that the DOW found support this morning at the 200 day ema, 10432.

Jonathan Levinson : 3/23/2005 12:03:47 PM

QQQQ's extending what would be the right shoulder of the possible reverse h&s, but not invalidating it yet. So far, the short cycle downphase has been weak and choppy within the 30 and 60 min cycle upphases, but the failures below 36.40 have them hesitating as well. Link Barring a high volume break above 36.40 or below 36.20, this is a good recipe for continued sideways chop.

Jeff Bailey : 3/23/2005 12:03:16 PM

12:00 Market Watch at this Link

Jeff Bailey : 3/23/2005 12:00:54 PM

June Crude Oil (cl05m) $55.40 -2.32% (30-min delayed) ... resting on its WEEKLY S1 of $55.33. I get the feeling that traders and computers taking a deep breath today. Letting things settle down a bit after yesterday's wild session.

Jeff Bailey : 3/23/2005 11:57:06 AM

QQQQ $36.25 +0.33% .... session low kissed its WEEKLY S1 of $36.08.

Linda Piazza : 3/23/2005 11:52:25 AM

The OEX does appear to be setting up into a flag-like formation as it tries to climb. Time to snap a Fib retracement bracket on the last plunge, post-FOMC announcement. The 38.2% retracement is at about 560.50 and the 50% retracement at about 561.60, but currently the OEX struggles with strong Keltner resistance up to about 559.30.

Linda Piazza : 3/23/2005 11:50:00 AM

I'm having difficulties with my email today. I can see the email and write replies, but somehow the replies are not getting out. I'm working from out of town, and so don't have access to the information I need to check the account and see what's wrong.

Jonathan Levinson : 3/23/2005 11:45:13 AM

The CRB's getting slammed again, currently down 5.29 at 307.73 with cocoa, coffee and crude oil leading to the downside, cocoa down 7.74% today.

Jeff Bailey : 3/23/2005 11:44:27 AM

30-year YIELD ($TYX.X) unchanged at 4.891%. Its WEEKLY R2 is at 4.901%, or 49.01.

Jeff Bailey : 3/23/2005 11:43:31 AM

5-year yield ($FVX.X) up 5.5 bp at 4.331%. It's WEEKLY R2 is 43.13, or 4.313%.

Jeff Bailey : 3/23/2005 11:39:15 AM

10-year yield ($TNX.X) up 2.5 bp at 4.635% and hanging around correlative WEEKLY R2/MONTHLY R2. Pacholder High Yield (PHF) $8.64 -2.59% ... Its WEEKLY S2 is $8.75.

Jonathan Levinson : 3/23/2005 11:36:09 AM

QQQQ 100-tick chart update at this Link

Linda Piazza : 3/23/2005 11:35:45 AM

Reader Question: How would you determine the absolute median price of the OEX- or any index on any given month? Would you consider the daily pivot? Weekly pivot? Monthly pivot? Here is a little background for the question. I trade credit spreads on indexes. If I can determine an average price for an index on a monthly basis, I can determine what strikes to trade .

Response: Interesting question. By the construction of its formula, a pivot would be an average of the high, low and close of a certain period [Pivot = (High + Low + Close)/3]. By definition, a median price would be found by considering all the prices for a certain period and finding the price in the middle, the one at which there were an equal number of prices higher and lower during a certain period. It's an interesting question to consider how you would find that for a month's trading pattern, however. Would you take that month's closing values, array them and determine the middle or median value? Would you use an average of the day's high and low for each day and then find a median price of the month's trading days? Is there an indicator that does this automatically, one that I don't use?

So what is the difference between an average and a median price? Why use one or the other? Why is this reader concerned about a median price? Imagine that the OEX was essentially range-bound, but had some wacky days when it gapped and traded way outside the range for the rest of the month, only to climb back inside that range. The average would be skewed by those wacky outside-the-range days, but the median price would be less likely to be skewed.

However, I'm wondering if I'm understanding the readers' question as it was intended, and perhaps interpreting it too literally. Either an average or a median price is just a single price point. It doesn't indicate anything about whether the OEX is volatile or trades in a narrow range for a period of time, needed information if the reader wants to establish credit spreads above and below the expected range for a month. Perhaps this reader is more interested in finding the range for a typical or particular month? In that case, I might tend to look at pivot analysis, if you're a pivot analysis fan, or even Donchian channels (set on a 21-period length and using the daily chart, it's going to give you the range for the previous 21 days; set on 3 and viewed on a monthly chart, it's going to give you a range for the last three months) or even take a look at ATR on a monthly chart, which will give you the current average true range for a month's worth of movement on the OEX. Currently that's at 24.83.

Do the other writers have any other ideas that might be more helpful? I'm officially on vacation, working from out of town and on little sleep due to the joyous birth of a new grandchild, so I may be missing something obvious here.

Jeff Bailey : 3/23/2005 11:22:24 AM

Most Actives ... QQQQ $36.37 +0.66%, SPY $117.32 +0.35%, ORCL $12.51 +0.08%, SUNW $3.98 -1.24%, MSFT $24.24 +1.04%, AGR.A $1.50 -0.66%, JDSU $1.70 -0.58%, INTC $23.30 +1.21%, LU $2.72 -0.72%, SMH $32.52 +1.49%.

Jonathan Levinson : 3/23/2005 11:19:09 AM

QQQ 36.40 could be a neckline. If so, a high volume break above it could have an implied target as high as 36.90. However, the 30 and 60 min cycles are so far much more timid than that would suggest. Link

Jeff Bailey : 3/23/2005 11:13:22 AM

11:00 Internals at this Link Yesterday's Internals at this Link

Jonathan Levinson : 3/23/2005 11:10:20 AM

Ten year treasury yields are down to a 2.5 bp gain at 4.635%, well off the highs. On the daily chart, this is printing a tall upper doji shadow which, combined with the bearish stochastic divergence, signals caution for bond bears/TNX bulls. A close in negative territory would result in a tall gravestone doji, but the session isn't yet half done: Link

Linda Piazza : 3/23/2005 11:03:31 AM

The OEX is trying to convert that potential continuation-form H&S at the bottom of its decline into a double-bottom formation. A move above 559.31 would confirm it. Still keep seeing signs that the OEX is trying to steady, but if bulls take too long with this, bears might become emboldened again. If a bounce gets underway, bears should start covering and we'll get a better glimpse of the type of formation it's setting up.

Jeff Bailey : 3/23/2005 11:02:54 AM

11:00 Market Watch at this Link

Jonathan Levinson : 3/23/2005 11:00:59 AM

QQQQ update at this Link

Jane Fox : 3/23/2005 10:52:21 AM

Thank you for the TRIN readings Linda.

Linda Piazza : 3/23/2005 10:49:51 AM

The OEX's three-minute chart now shows a potential continuation-form H&S at the bottom of the decline. A new LOD would confirm it. A move above 559.31 would invalidate it.

Jonathan Levinson : 3/23/2005 10:47:27 AM

The 30 min cycle upphase is so far corrective for QQQQ, but it's early to count out the bulls- the 60 min channel generally takes longer to turn and often results in chop near the 30 min tops and bottoms. If that's the case here, we should not see the earlier lows broken. QQQQ is looking much stronger than its peers so far, holding on the 7200 tick SMA for its pullbacks and respecting 36.25 support.

Jonathan Levinson : 3/23/2005 10:43:42 AM

The DOE reports crude inventories +4.1M barrels for the week, gasoline inventories -4.1M barrels and distillates -2.8M barrels.

Jeff Bailey : 3/23/2005 10:42:04 AM

Dow Diamonds (DIA) $104.36 -0.17% ... AXP $50.24 -1.87%, XOM $59.86 -1.70%, AA $30.49 -1.51%, DD $51.02 -1.37% .... PFE $25.71 +1.14%, IBM $90.32 +0.91%, AIG $56.72 +0.92%

Linda Piazza : 3/23/2005 10:32:32 AM

The TRAN bounced from above 3700, and has inched back above its 30-sma again. Its bounce so far looks like a bear flag climb when viewed on a 15-minute chart, however.

Jeff Bailey : 3/23/2005 10:30:50 AM

Current OPEN MM Profiles that I've made at this Link

Linda Piazza : 3/23/2005 10:29:58 AM

SOX above the 200-sma.

Linda Piazza : 3/23/2005 10:29:18 AM

No steadying yet in the advdec line. A worrisome sign for the markets, but it is approaching extreme levels.

Jonathan Levinson : 3/23/2005 10:28:48 AM

Session low for Nymex crude here at 54.525, -1.5.

Jeff Bailey : 3/23/2005 10:26:49 AM

Agere Systems Class A (AGR.A) $1.50 -0.66% ... showing a block of 25 million shares from 10:10-10:15. #2 on most active. I don't see any news of a spot secondary.

Linda Piazza : 3/23/2005 10:25:06 AM

Checking in for a moment. The OEX did rise, but now eases a little. It may be trying to form some kind of measured distribution type rise, which those wanting to see a new bearish entry would like to see.

Jonathan Levinson : 3/23/2005 10:15:41 AM

QQQQ 100 tick chart update at this Link with the short cycle maxxing out within the 30 and 60 min cycle upphases. If the bulls can hold above 36.25 support, it should begin trending.

Jeff Bailey : 3/23/2005 10:13:24 AM

10:00 Internals at this Link

Linda Piazza : 3/23/2005 10:09:34 AM

Stepping away for a while. I'll check in as often as is possible. Bears, continue to follow the OEX lower with your stops, being aware of the possibility of a countertrend bounce.

Jonathan Levinson : 3/23/2005 10:06:33 AM

QQQQ cleared 37.25 and failed at upper channel resistance, with the 30 min channel ticking up. The upphase should continue above 7200 tick SMA support at 36.15. Link

Linda Piazza : 3/23/2005 10:06:18 AM

The OEX still looks like an index that's trying to steady to me. I've no idea whether it will be successful in doing so, but the action on the 15-minute candles suggests the effort, and that effort is occurring at known daily Keltner potential support.

Jonathan Levinson : 3/23/2005 10:04:14 AM

Existing home sales 6.79M vs. 6.70M exp.

Jeff Bailey : 3/23/2005 10:02:20 AM

10:00 Market Watch at this Link

Linda Piazza : 3/23/2005 10:01:44 AM

To give myself a fresh look and because the Dow usually adheres fairly well to a 15-minute Keltner charts' resistance and support levels, I turned to look at the Dow's 15-minute Keltner chart. I see that a breakdown signal has been created on that chart, with the Dow needing a 15-minute close above the Keltner line currently at 10,485.45 to erase that breakdown signal. The breakdown signal has been confirmed on the 30-minute chart, too, and will be on the 60-minute one with a first-hour close beneath the Keltner line currently at 10,469.25. No sign of steadying yet on these charts, but remember the 200-ema just below, too. Bears should continue to follow the Dow lower with their stops, having profit-protecting plans in place.

Jonathan Levinson : 3/23/2005 9:59:08 AM

April gold is up to a 4.8 loss at 426.80, with HUI down .34% at 205.47 and XAU -.45% at 95.35. Crude oil is down 1.61% at 55.125 here.

Linda Piazza : 3/23/2005 9:57:04 AM

As others have pointed out, the Dow hovers just above its 200-ema and 200-sma, with those at 10,430.39 and 10,376.21.

Linda Piazza : 3/23/2005 9:55:24 AM

SOX is at its 200-sma.

Linda Piazza : 3/23/2005 9:54:49 AM

The TRAN's steep drop soundly rejected the inverse H&S that was trying to build. Not good for market bulls of any stripe.

Jonathan Levinson : 3/23/2005 9:53:35 AM

The Fed has replaced the 3.75B overnight repo expiring with a 2.25B overnight repo for a net 1.25B drain today.

Jonathan Levinson : 3/23/2005 9:52:44 AM

Existing home sales due in 8 minutes, est. 6.7M.

Linda Piazza : 3/23/2005 9:51:24 AM

The OEX's 15-minute chart shows a series of candles that visually depict the OEX's efforts to steady, including two doji. Bears, have profit-protecting plans in place. As has been true lately, any bounce should be viewed as a countertrend one, and therefore risky to trade with options. An upside move could be explosive, but could also be choppy and its movements difficult to predict.

Jeff Bailey : 3/23/2005 9:49:34 AM

Pacholder High Yield (PHF) $8.56 -3.49% ... geting "junked" this morning. Treasuries reversing earlier weakness with 30-year YIELD ($TYX.X) down 1.1 bp at 4.88%.

Jeff Bailey : 3/23/2005 9:47:11 AM

U.S. Energy (USEG) $6.30 -5.26% ....

Linda Piazza : 3/23/2005 9:47:02 AM

No steadying in the advdec line yet.

Jeff Bailey : 3/23/2005 9:45:47 AM

Starbucks (SBUX) $51.18 -0.92% ... Thomas Weisel initiates coverage with "outperform" rating.

Jonathan Levinson : 3/23/2005 9:44:08 AM

New high for QQQQ, taking a run at 36.25 resistance: Link

Jeff Bailey : 3/23/2005 9:43:55 AM

Hewlett Packard (HPQ) $19.74 -1.34% ... percentage loser among Dow components after Sanyo Electronics and Seiko Epson cut their earnings outlook for 2005.

Linda Piazza : 3/23/2005 9:42:20 AM

The OEX tests daily Keltner support. Daily resistance looks as if it's trying to firm first near 561.15 and then perhaps near 564, depending on how fast the OEX might rise . . . or, of course, on whether it does rise or not. A daily close beneath the Keltner support currently being tested would set up a new breakdown signal on the daily chart. This is support that usually holds the OEX, so it's going to take a strong thrust to get through on it on a daily close, but perhaps not on an intraday move. On a bounce, look for a rollover.

Linda Piazza : 3/23/2005 9:39:24 AM

If the TRAN is going to form an inverse H&S at the bottom of its decline on the 60-minute chart, then it needs to steady off here, near 3750. The TRAN is at 3750.11 as I type. A drop below 3731 will invalidate the formation.

Linda Piazza : 3/23/2005 9:37:03 AM

SOX attempting to climb once again toward its 200-sma. Watch that test.

Linda Piazza : 3/23/2005 9:36:18 AM

BIX slightly negative, but perhaps trying to steady.

Jonathan Levinson : 3/23/2005 9:35:18 AM

QQQQ's started a short cycle upphase from here, with the 7200 tick SMA turning up and the oscillators rising. A break of 36.25 resistance will confirm it, but it will have to hold in order to attack the combined 30 and 60 min channel resistance at 36.32.

Linda Piazza : 3/23/2005 9:33:23 AM

Advdec line drops strongly at the open. Waiting to see the trajectory of its actions, though.

Linda Piazza : 3/23/2005 9:31:52 AM

No, the OEX does not move to complete the morning star formation first thing. As I mentioned earlier, daily Keltner support is down at 557.07 (slight change since the open), so downside could possibly be limited today.

Linda Piazza : 3/23/2005 9:30:21 AM

I'll try to stick around for the opening. The OEX's last 15-minute period produced a doji at the bottom of a drop. Market watchers will now be waiting to see if the first 15-minute period completes a morning-star pattern. First 15-minute resistance is near 559.64, then at 560.51 and then somewhat stronger at 561.46.

Jeff Bailey : 3/23/2005 9:25:26 AM

XM Satellite Radio (XMSR) $28.04 ... higher at $28.95 after announcing that Korean automaker Hyundai will include its radios as standard equipment in all its U.S. cars next year.

Jonathan Levinson : 3/23/2005 9:18:04 AM

Session high for gold here, -3.10 at 428.5, silver up to a 5 cent loss at 7.015.

Jonathan Levinson : 3/23/2005 9:00:46 AM

QQQQ is bouncing to to retest yesterday's closing levels from below: Link The daily cycle downphase is just entering oversold territory, while the 30 min cycle downphase continues to work its way lower. There's a potential bullish divergence in the 30 min cycle if the price turns up and the next upphase kicks off from here.

There's confluence support to 35.70 from October 2004's range, and if those levels are reached, both the 30 min and daily cycles should be maxxing out in oversold. The next upphase should tell us a great deal- a weak/sideways/corrective upphase will confirm a new downtrend, while a strong bounce will restore the bulls. Judging from the strength of the move down in bonds/up in yields, I'm guessing that it will be the former, but in either case the 35.70 area should provide strong support for the intraday and daily cycles.

Linda Piazza : 3/23/2005 8:52:51 AM

I'm still on vacation, but will try to post as frequently as possible to help out where I can.

After the FOMC decision, the OEX appeared to be turning down within this channel and continued that downturn through the end of the day: Link The daily close created a breakdown signal on the daily Keltner chart with a current downside target of 556.60, nearly reached Tuesday. It also approached the January low of 556.47, so bears should be prepared for a potential bounce. I still consider it a countertrend bounce, if it occurs, with resistance likely to be encountered near 564 and then again from 569-571.50, according to the daily Keltner chart.

Jonathan Levinson : 3/23/2005 8:48:27 AM

Crude oil is down another 1.65% here to 55.10, gold down 1.2% to 426.4, silver -1.49% to 6.96. QQQQ is down .30% to 36.02.

Jonathan Levinson : 3/23/2005 8:44:52 AM

TNX is up 6.4 bps here, a 1.39% jump. 20-day 30-min chart of the TNX at this Link

Jonathan Levinson : 3/23/2005 8:33:56 AM

New highs for the USD Index: Link

Jonathan Levinson : 3/23/2005 8:32:37 AM

Session low for ten year bonds at 108, TNX +5.7 bps at 4.667%, a 1.24% jump in the past 2 minutes. QQQQ's at a low of 35.96.

Jonathan Levinson : 3/23/2005 8:31:54 AM

Another upside surprise in the inflation data. The y-o-y change in the CPI is 3%, 2.4% for the core rate. For the PPI, it was 4.7% as reported yesterday.

Jonathan Levinson : 3/23/2005 8:30:30 AM

CPI + .4%, est. +.3%

Core CPI + .3%, est. +.2%

Jonathan Levinson : 3/23/2005 8:29:40 AM

Session lows for gold ans silver here, ten year notes ticking negative with TNX up 0.1 bps at 4.611% and session high for YM futures.

Jonathan Levinson : 3/23/2005 8:11:21 AM

I was up for part of the night with a migraine that is just starting to recede. I'll be keeping an eye on the charts, and hopefully be back to full strength as the morning progresses.

Equities are mixed, but off their evening lows. QQQQ is trading 36.09, down 4 cents. Gold and silver are both down, gold off a low of 425.50, with ten year bonds unchanged.

The CPI is due at 8:30, followed by Existing Home Sales.

Linda Piazza : 3/23/2005 7:10:36 AM

Good morning. The Nikkei dropped heavily last night, hurt by U.S. weakness and its own economic release. Most other Asian markets closed lower, too, and European markets currently show weakness. Our futures are modestly higher. As of 6:56 EST, gold was down $5.20 as the dollar strengthened overnight, and crude, down $0.91 to $55.12. More detail about Asian and European markets follows in succeeding paragraphs.

Following through on post-FOMC weakness in the U.S. and impacted by its own economic data, the Nikkei dove Wednesday morning, dropping 160 points by the opening of the afternoon session. The Nikkei climbed off that low, closing lower by 102.85 points or 0.87%, at 11,739.12. February's merchandise trade surplus dropped 21.7% when compared to the year-ago period against expectations of a 4.8% decline. That produced an annual increase of 1.7%, with expectations having been for a 6.2% gain. January's annual rate had been for 3.2% growth. Exporters led declines.

Most other Asian markets dropped. The Taiwan Weighted gained 0.01%, but South Korea's Kospi dropped 1.39%. Singapore's Straits Times fell 1.44%, and Hong Kong's Hang Seng lost 1.25%. China's Shanghai Composite declined 0.44%.

European markets drop this morning, too. In the U.K., retailers have been hit as several warn of a difficult trading environment. Inflation-sensitive stocks drop. In stock-specific news, airline Deutsche Lufthansa bucks the downtrend and gains after announcing that it will buy Swiss International Air. Although Morgan Stanley defended pharmaceutical group Schering earlier in the week, Deutsche Bank cut its rating of the company today, and the stock dropped. Other changes by analysts included a J.P. Morgan upgraded of Renault, a Morgan Stanley upgrade of French water utility Veolia Environment and a Morgan Stanley downgrade of Group Danone.

As of 7:02 EST, the FTSE 100 had lost 39.20 points or 0.79%, to trade at 4,898.10. The CAC 40 had dropped 27.20 points or 0.67%, to 4,019.98. The DAX had fallen 26.31 points or 0.61%, to trade at 4,294.38.

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