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Jeff Bailey : 4/19/2005 12:12:12 AM

Semiconductor HOLDRs (SMH) went out at $30.29 +1.27% in Monday's session. Last tick in extended hours was $30.66. WEEKLY Pivot Levels ... $28.07, $29.00, Piv= 30.81, $31.73, $33.54.

Jeff Bailey : 4/19/2005 12:10:49 AM

Texas Instruments (TXN) $22.92 Link ... after the bell, shares rose to $24.35 after the chipmaker said quarterly net income rose to $411 million, or $0.24 per share from $367 million, or $0.21 per share in the same period a year ago. Sales rose 1.2% to $2.97 billion. Looking forward, TXN said profits this quarter will be between $0.25-$0.29 per share on sales of $3-$3.24 billion. Consensus was for $0.26 per share on sales of $3.17 billion.

OI Technical Staff : 4/18/2005 9:59:59 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The Market Monitor has been archived.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.

Jeff Bailey : 4/18/2005 9:06:13 PM

AstraZeneca (AZN) $43.20 ... late this evening, National Cancer Institute halts trial for Iressa drug. Story at this Link

Jeff Bailey : 4/18/2005 5:51:23 PM

Pivot Matrix for tomorrow at this Link

Jeff Bailey : 4/18/2005 5:06:01 PM

Closing Internals at this Link ... VIX.X never did quite make it below DAILY Pivot today.

Jeff Bailey : 4/18/2005 4:45:31 PM

Closing U.S. Market Watch at this Link

Jeff Bailey : 4/18/2005 4:27:18 PM

Current OPEN MM Profiles at this Link Today's Activity ... Sold the one (1) Apple Computer AAPL July $42.50 Put (QAA-SV) at the bid of $8.10. ($+3.90, or 92.86%). Closed out (bought back) the two (2) Apple Computer AAPL May $32.50 Puts (AAQ-QZ) at the offer of $0.90. ($-0.35, or -63.64%). Day traded short the underlying shares of AstraZeneca (AZN) at $42.64, stopped at $43.20. ($-0.22, or -1.31%).

Linda Piazza : 4/18/2005 4:00:54 PM

We'll have to wait until tomorrow to see how the OEX behaves with respect to that building rising regression channel, likely a bear flag. I do want to note that the VIX finally did fall through the rising best-fit trendline off the 4/12 low, but it moved sideways after doing so. When an equity does that, I find the breakdown below the line to be suspect and often see the equity prices rise up to follow the form ascending trendline from the underside. I'm not sure how the VIX will react, but we'll see tomorrow with that, too.

Jane Fox : 4/18/2005 3:57:47 PM

The AD line is above the neutral zone at +582 which is certainly nothing to write home about. AD volume on the other hand is making new daily highs. But this is what has given me a little bit of bullishness today. Link

Linda Piazza : 4/18/2005 3:54:47 PM

One thing bothers me about the bear-flag climb in the chart linked to my 3:47 post: the OEX has been having difficulty with the 50% retracement of the last plunge, showing a tendency to flatten at the top of the supposed bear flag climb rather than rising to the top of the rising regression channel depicted there. That shows some possible weakness of the type sometimes seen before a flag fails.

Jonathan Levinson : 4/18/2005 3:54:33 PM

The cycle picture remains as mixed for QQQQ as it's been all day, with a weak/corrective 30 min upphase underway, a 60 min cycle upphase recently printing buy signals in oversold territory, and the daily cycle still in its strong downphase. Upside intraday channel resistance has declined from the 35.00-35.13 area to now overlap at 34.97. Until the lower end of the range in the 34.60 area breaks, the intraday cycles will continue to indicate a bounce, but so far that bounce has been weak and uncertain at best.

Jane Fox : 4/18/2005 3:51:38 PM

Dateline CNN Six-time Tour de France winner Lance Armstrong announces his retirement and says this year's tour will be his last race.

Linda Piazza : 4/18/2005 3:47:33 PM

If the OEX is forming a bear flag in which it will retrace a portion of the entire drop from the 4/12 high, here's how the flag and the Fib levels shape up: Link

Jeff Bailey : 4/18/2005 3:46:25 PM

Astrazeneca (AZN) $43.08 -0.78% ... a lot of action in the May $40 Puts (AZN-QH) 2,803:1,420 and May $45 Puts (AZN-QI) 526:3,109. This is an ADR and not sure how stock might trade tomorrow after overseas trade.

Jeff Bailey : 4/18/2005 3:40:04 PM

Sirius Satellite Radio (SIRI) $5.06 -1.74% ... defensive on volume.

Linda Piazza : 4/18/2005 3:39:23 PM

The OEX's moves today have morphed several times, from a possible bear-flag climb into a neutral triangle, into a possible inverse H&S (still a possibility) and now into another, larger possible bear flag. I mentioned this morning that the OEX might be trying to form a bear flag big enough to retrace a portion of the entire drop off the 4/12 high, and not just off the latest plunge, and that may be what's happening.

Jonathan Levinson : 4/18/2005 3:35:51 PM

QQQQ busted back above the 7200 tick SMA line, still at 34.80, with volume up to 101.7M shares still within this 30 cent range. It's either distribution or accumulation- the daily cycle says the former, the intraday charts say the latter. We won't know until either side blinks, signalled by a break above 34.97 or below 34.64.

Jeff Bailey : 4/18/2005 3:26:20 PM

Bearish Day Trade stop alert ... for Astrazeneca (AZN) $43.20 -0.50%

Jeff Bailey : 4/18/2005 3:11:24 PM

03:00 Internals at this Link

Linda Piazza : 4/18/2005 3:10:04 PM

The OEX's 10-minute 21-ema is now serving again as resistance, but I'm not so sure it's resistance rather than a MA around which the OEX is coiling. It may have lost some of its predictive qualities.

Jonathan Levinson : 4/18/2005 3:08:31 PM

QQQQ 100-tick chart update at this Link . The TRINQ is ticking lower here to .58, showing a light increase in buying pressure within today's sideways range.

Jeff Bailey : 4/18/2005 3:03:32 PM

03:00 Market Watch at this Link

Jeff Bailey : 4/18/2005 3:01:20 PM

Buy Program Premium .... SPX 1,146.41, DIA $100.74, QQQQ $34.76.

Linda Piazza : 4/18/2005 2:56:49 PM

Jeff, that VIX bounce also came at the ascending trendline off the 4/12 low, a trendline I've been watching today. (See my 1:01 post.) The two coincided. Link

Jeff Bailey : 4/18/2005 2:56:47 PM

Bearish day trade short alert ... for Astrazenca (AZN) $42.64 here, stop $43.20, target $40.10.

Jonathan Levinson : 4/18/2005 2:55:33 PM

Nymex May crude closed lower by .175 at 50.325. Daily updated chart at this Link

Jeff Bailey : 4/18/2005 2:55:30 PM

Astrazeneca (AZN) $42.81 -1.40% ... active and off spike session low of $41.99 .... Natl. Cancer Institute may halt Iressa Trial.

Linda Piazza : 4/18/2005 2:47:30 PM

Here's what the OEX's 15-minute Keltner chart currently shows: The OEX is testing support near 546.75. Next resistance is at 548.04. Currently, support looks stronger than resistance, but that remains to be seen after the resistance is tested. Today, not much can be trusted.

Jeff Bailey : 4/18/2005 2:43:09 PM

VIX.X 16.86 -4.96% ... edging back higher after close encounter with its DAILY Pivot (16.42).

Jeff Bailey : 4/18/2005 2:45:16 PM

S&P Banks (BIX.X) 348.46 +0.96% ... only equity-based index (in Pivot Matrix) to achieve DAILY R1. Major indices all find sessiion selling at, or below their DAILY Pivots.

Jonathan Levinson : 4/18/2005 2:39:21 PM

QQQQ continues to slide net sideways within the intraday rectangle, currently in a short cycle downphase on the failure from a lower high at 2PM. 30 and 60 min channel support continue to line up in the 34.64 support area, however. Volume breadth remains positive, with the TRIN and TRINQ printing a neutral .89 and .67 respectively and volume breadth lightly positive, 1.4 advancing NYSE shares for each declining, 1.60 advancing on the Naz.

Linda Piazza : 4/18/2005 2:34:31 PM

The OEX's 10-minute 21-ema is no longer holding as support, but there's a potential inverse H&S on that chart, too. Mixed evidence.

Jeff Bailey : 4/18/2005 2:36:38 PM

Dow Jones ... United Steelworkers Files Unfair Labor Practice Charges Against Ormet Affiliates. DJ U.S. Steel Index (DJUSST) 147.87 +4.47% Link ...

Jeff Bailey : 4/18/2005 2:24:25 PM

10 Most Actives ... QQQQ $34.76 +0.02%, SPY $114.48 +0.28%, MSFT $24.68 +0.85%, CSCO $17.14 -0.34%, SUNW $3.51 -4.09%, INTC $22.27 +0.67%, AAPL $35.90 +1.49%, SIRI $5.19 +0.77%, LU $2.37 -1.25%, SMH $30.28 +1.23%.

Linda Piazza : 4/18/2005 2:22:49 PM

Last week, I posted two weekly charts of the TRAN, with the semi-log chart being the first to show a TRAN break of a long-term trendline. Link Now the TRAN has broken through on the arithmetic chart, too, although today it's rising to retest that trendline from below: Link

Jonathan Levinson : 4/18/2005 2:18:04 PM

Stepping away for 10 minutes.

Jeff Bailey : 4/18/2005 2:12:06 PM

10-year Yield ($TNX.X) down 0.9 bp at 4.262%

Jeff Bailey : 4/18/2005 2:16:36 PM

Dow Jones ... Fed Governor Bies ... "Fed Can Keep Raising Rates at Measured Pace." Bies adding "productivity slowing and labor costs increasing".... inflation "well contained"... consumer and business "confidence remains favorable" and has improved overall sentiment...

Linda Piazza : 4/18/2005 2:10:43 PM

The OEX continues to find support on its ten-minute 21-ema, but that holding of support continues to be less than inspiring--upper shadows, doji, red candles, etc.

Jeff Bailey : 4/18/2005 2:08:35 PM

02:00 Internals at this Link

Jonathan Levinson : 4/18/2005 2:06:55 PM

Session low for ten year bonds, TNX up to a 1.1 bp loss at 4.262%, with QQQQ spiking back to the 34.90 area: Link

Linda Piazza : 4/18/2005 2:05:46 PM

The SOX's inverse H&S has failed to confirm so far, with the right shoulder extending far enough to throw the formation into question. That too-far-extended-to-the-side right shoulder is trying to form its own inverse H&S, however, with a confirmation level soon to be tested, at about 388.62, with the SOX currently at 387.17. Those hoping for a rise in the SOX want to see this formation confirmed. The SOX may soon run into resistance near 390-393, however.

Jeff Bailey : 4/18/2005 2:01:31 PM

02:00 Market Watch at this Link

Jonathan Levinson : 4/18/2005 1:59:22 PM

Today's earlier QQQQ high fell just short of retracing 50% of Friday's decline, and on a closeup view, the current range is a flat rectangle within Friday's bearish candle between 34.63 and 34.97. The bullish interpretation would treat this as an accumulation near the lows, building "cause" for the next advance. The bearish view notes that the flag/rectangle/pennant formations as continuation pattern, and while this could be a complex bottom, the strict chart formation projects lower. A break of either end of today's range should see directional followthrough, but until it occurs, price remains at the bottom of a strong downtrend.

Jeff Bailey : 4/18/2005 1:58:03 PM

Martha Steward Living (MSO) $20.39 +4.19% ... reaches deal with Sirius Satellite Radio (SIRI) $5.25 +1.94% to create 24-hour channel featuring cooking, gardening and entertaining programming for women.

Linda Piazza : 4/18/2005 1:52:29 PM

The OEX's 10-minute 21-ema still holds as support, but still only tentatively. Since pushing above it, the OEX has been coiling, waiting for a breakout one direction or the other.

Jeff Bailey : 4/18/2005 1:51:39 PM

CRB Index (cr00y) 298.05 -0.26% (30-min delayed) ....

Jeff Bailey : 4/18/2005 1:50:41 PM

U.S. Dollar Index (dx00y) 84.00 -0.66% (30-minute delayed) ... getting data feed now.

Jonathan Levinson : 4/18/2005 1:47:39 PM

Nymex May crude oil is down .225 here at 50.275. Intraday chart at this Link

Jeff Bailey : 4/18/2005 1:45:24 PM

VIX.X 16.62 -6.31% ... has not fallen below its DAILY Pivot since early Wednesday's morning.

Linda Piazza : 4/18/2005 1:43:24 PM

The OEX still tests the ten-minute 21-ema to see if it holds as support. It is, so far, but that hold is far from convincing as yet.

Jeff Bailey : 4/18/2005 1:55:29 PM

Sturm Ruger (RGR) $6.73 +3.06% ... firearms maker Q1 net income falls 5.1%, while sales up 10%. Not seeing any news on current dividend strategy. Annual dividend $0.40 per share.

Jeff Bailey : 4/18/2005 1:34:06 PM

Mylan Labs (MYL) ... gets FDA approval for Anagrelide Hydrochloride Capsules.

Linda Piazza : 4/18/2005 1:30:30 PM

The OEX currently tests the 10-minute 21-ema to see if this former resistance now holds as support. That MA is at 548.50 and the OEX is currently at 549.12.

Jeff Bailey : 4/18/2005 1:23:55 PM

Current OPEN MM Profiles at this Link

Jonathan Levinson : 4/18/2005 1:23:40 PM

QQQQ just bounced from the 7200 tick SMA, rising sharply. It's all noise below that 34.96 resistance line, however: Link

Jonathan Levinson : 4/18/2005 1:22:47 PM

Indirect bidders/foreign central banks took down 2.7B of the 3 month t-bills and 3.5B of the 6 month t-bills, just over 1/5th of the total auctioned today. Currently, ten year treasuries are creeping higher off the lows, TNX down 2.4 bps at 4.249%.

Linda Piazza : 4/18/2005 1:19:30 PM

Fifteen-minute Keltner support now sists near 547.50, resistance may eventually firm near 551.25.

Linda Piazza : 4/18/2005 1:16:06 PM

Gravestone doji produced on the last 15-minute candle. Not a comfortable candle for those hoping for a bounce. Any confirmation signal requires confirmation, however, and the OEX currently attempts to rise.

Jeff Bailey : 4/18/2005 1:16:31 PM

Maverick Tube (MVK) $30.08 +3.72% ... bulls were stopped on 1/2 bullish position at $29.00 on Friday as stock fell to as low as $27.79 intra-day. Today... Raymond James upgrades stock to "strong buy" from "market perform." Stock spike to $31.79 at the open. If still long and not stopped out, I would have profiled the SELLING OF $32.50 COVERED CALLS after Friday's break of trend.

Jonathan Levinson : 4/18/2005 1:14:09 PM

Another failure at the previous high, the 3rd such intraday reversal: Link

Jeff Bailey : 4/18/2005 1:12:15 PM

01:00 Internals at this Link

Linda Piazza : 4/18/2005 1:09:21 PM

Here is what the OEX's fifteen-minute Keltner chart currently shows: The OEX currently tests resistance, but stronger resistance is higher, up near 551.37 currently, a zone of known S/R. Above that, Keltner resistane is way above, at 555.20-555.90, but still descending sharply, so that it might have dropped into the 553-554 zone by the time that could be tested. Support is trying to firm below the OEX, at 547.50-548.25.

Jonathan Levinson : 4/18/2005 1:09:09 PM

The 3 month t-bill auction fetched a bid-to-cover ratio of 2.1 on the 16B sold. The 6 month t-bill auction generated a 2.25 bid-to-cover ratio on the 14B sold. I will post the indirect bidder/ foreign central bank participation in a few minutes.

Jeff Bailey : 4/18/2005 1:04:23 PM

01:00 Market Watch at this Link

Linda Piazza : 4/18/2005 1:01:37 PM

Interestingly enough, the VIX is descending to test the ascending trendline it built off the 4/12 low, with that trendline currently at about 16.30 if a best-fit basis is used. The VIX is at 16.74 currently, and the 38.2% retracement of the VIX rally doesn't occur until about 15.75.

Jonathan Levinson : 4/18/2005 1:00:54 PM

Ten year treasuries have just dived, TNX up to a 1.5 bp loss at 4.258%. The treasury auction results will be in shortly.

Jonathan Levinson : 4/18/2005 12:59:12 PM

Volume breadth is back to positive on the NYSE and Naz, 1.79 in favor of advancing shares for the NYSE, 2.5 for the Nasdaq.

Linda Piazza : 4/18/2005 12:57:57 PM

The OEX confirmed the double-bottom formation by a few cents . . . so far. Heading higher as I type.

Jonathan Levinson : 4/18/2005 12:57:45 PM

QQQQ retests 34.90, current upper rising 30 min channel resistance. The upper violation should see resistance assert itself here, but because of how oversold all these cycles still are, my guess is that it will continue to edge higher unless 7200 tick SMA at 34.77 gets broken. Link

Linda Piazza : 4/18/2005 12:55:48 PM

Initial signs of a change in trend underway on the OEX's 15-minute Keltner chart and on the ten-minute chart. They need to be sustained, however. A move above 549.56 will confirm a double-bottom shape on the OEX, with that confirmation level about to be tested.

Jeff Bailey : 4/18/2005 12:55:28 PM

Dow Diamonds (DIA) $100.712 +0.01% ... inch green. Updated WEEKLY/MONTHLY Pivot retracement at this Link

Linda Piazza : 4/18/2005 12:49:16 PM

The OEX attempts to erase the breakdown signal on its 15-minute Keltner chart, but there has as yet been no 15-minute close back above the breakout level or the confirming move above the Keltner line currently at 549.01. At the same time, the OEX attempts a move above the 10-minute 21-ema, with success on both attempts signaling a possible change in tone. "Possible," only, though.

Jonathan Levinson : 4/18/2005 12:46:15 PM

QQQQ edges its way back above the 7200 tick SMA here, but volume has been declining for the past 20 minutes. That should change if this slow climb can surpass 34.85.

Linda Piazza : 4/18/2005 12:41:07 PM

For the second time today, the OEX tests the 10-minute 21-ema, an average that has stopped OEX advances for several days. That average is currently at 548.13, and bears don't want to see sustained values above it, although the OEX has occasionally popped above it for a few minutes over the end of last week.

Jonathan Levinson : 4/18/2005 12:36:22 PM

The Treasury is auctioning another 30B in 3-month and 6-month t-bills. I'll post the results when they're released just after 1PM.

Jonathan Levinson : 4/18/2005 12:33:57 PM

QQQQ edges its way higher, approaching the flattening 7200 tick SMA resistance at 34.77. QQQQ's 30 min cycle oscillators have printed an oversold buy signal, but with price not advancing, this looks like more noise within the trending downphase from Friday. As for the 60 min cycle oscillators, they have yet to twitch. Currently, channel resistance is at 34.85 for the 30 min, 34.96 for the 60. Volume is back to a normal rate, with 68.4M QQQQs traded so far- compare to Friday's mammoth 170.3M total.

Jeff Bailey : 4/18/2005 12:35:07 PM

Pacholder High Yield (PHF) $8.90 +0.67% Link ... updated relative strength chart of PHF verus 10-year Yield ($TNX.X) at this Link Note: 21-day SMA ABOVE 50-day SMA benchmarks of 09/23/03, 07/02/04, 2/01/05. 21-day SMA BELOW 50-day SMA benchmarks of 04/15/04, 11/23/04, 03/09/05.

Linda Piazza : 4/18/2005 12:27:28 PM

Still no follow-through as yet on the OEX's decine. There's also no new sustained push above the ten-minute 21-ema, currently at 548.15. A test of that MA will also constitute a retest of the previous support for the triangle.

Linda Piazza : 4/18/2005 12:25:15 PM

The SOX is attempting to steady at the January low, which also happened to be at/near the 50% retracement of the SOX's rally off the October 2002 low into the January 2004 high. That Fib level is at about 385.02, an estimated number since I snapped the Fib bracket and didn't calculate it exactly. On a 15-minute chart, the SOX has a rough inverse H&S that has not yet been confirmed. Bears and bulls alike might watch the formation, keeping in mind that any bounce now might be an automatic one at perceived support--a technical bounce.

Jeff Bailey : 4/18/2005 12:13:17 PM

12:00 Internals at this Link

Jonathan Levinson : 4/18/2005 12:11:42 PM

Volume breadth has weakened, with the NYSE TRIN up to .96 and the TRINQ up to .71. Declining NYSE volume has overtaken advancing volume 1.03:1, while there are still 1.13 advancing Naz shares for each declining.

Linda Piazza : 4/18/2005 12:09:17 PM

I've been playing around with Fib levels on the TRAN, looking at the monthly chart. The TRAN's rally took it from the March 2003 low all the way into this March's high, a two-year rally. Wow. A 38.2% retracement of that rally is at about 3140. The TRAN is already below the 23.6% Fib level Marc has been mentioning as important lately, sitting below the 200-ema and -sma as I type. The TRAN appears to be trying to steady today, printing a doji as I type, but if it does, it's likely to find resistance at the 200-ema and -sma at 3460.55 and 3476.53, respectively. The TRAN may have much more downside to go, if it rolls down again after a retest of those averages.

Jeff Bailey : 4/18/2005 12:06:23 PM

12:00 Market Watch at this Link

Jonathan Levinson : 4/18/2005 12:00:20 PM

QQQQ is bouncing here after printing a lower doji to 34.65: Link . The first goal for a bounce is 34.80, a break above which would confirm the double bottom and kick off a new short cycle upphase.

Linda Piazza : 4/18/2005 11:57:39 AM

The OEX's 15-minute Keltner channel still shows Keltner resistance to be strong, with that resistance currently from 547.93-548.28, but it's a bit troublesome (to those hoping for more downside) that there was no follow-through after the OEX hit a new LOD.

Jeff Bailey : 4/18/2005 11:56:05 AM

Dow Diamonds (DIA) $100.26 -0.43% ... MONTHLY S2 here. Just off session low of of $100.11.

Linda Piazza : 4/18/2005 11:50:50 AM

Immediate bounce on the after reaching a new LOD, but so far, the OEX is finding resistance at three-minute resistance near 546.75. So far. Be careful. The ten-minute 21-ema is now at 548.54, with that average providing resistance for days.

Jonathan Levinson : 4/18/2005 11:44:43 AM

QQQQ is back to testing its prior low, breaking it as I type. Channel support lines up with the earlier morning low at 34.64, but a failure to bounce within the coming minutes will see those levels begin to decline. Bulls need to see this level hold as a double bottom. Link

Jeff Bailey : 4/18/2005 11:48:35 AM

Dow Diamonds (DIA) components sorted by PRICE weighting at this Link . Only Citigroup (C) Link , General Electric (GE) Link , Merck (MRK) Link and Pfizer (PFE) Link showing gains over last 5 sessions. DIA looks vulnerable to that $96.00 strike. (03/22/05 Option Chain) at this Link

Linda Piazza : 4/18/2005 11:43:32 AM

The OEX approaches the LOD. Those who might have entered a new play based on the triangle breakdown really need to see a pronounced new LOD--may be happening as I type.

Linda Piazza : 4/18/2005 11:41:24 AM

The OEX is breaking down out of that symmetrical triangle, but hasn't confirmed by a new LOD.

Jonathan Levinson : 4/18/2005 11:40:57 AM

The US Dollar Index is testing the water below 84, down off its Friday highs above 85. A G7 meeting is always good to roil the currency markets, despite the relatively little that this one appears to have accomplished. USD Index chart at this Link . Gold is currently up 3.80 at 429.50m silver made it to a high of 7.069 but is back to fractional negative at 7.058, while HUI is up 2.63% at 185.31.

Jeff Bailey : 4/18/2005 11:40:06 AM

Sell Program Premium .... SPX 1,141.60, DIA $100.25, QQQQ $34.75

Linda Piazza : 4/18/2005 11:34:15 AM

Keene's probably right about the possibility for symmetrical triangles to form. We may be seeing the OEX, too, form into a symmetrical triangle at the bottom of its range. If so, the expected (but not given) breakout would be to the downside. The OEX nears a test of the support of its triangle (at about 547.40 currently), but anyone considering any kind of bearish play today in case of such a breakdown should be aware of the potential for a bounce to begin at any time, should be particularly watchful as the LOD is retested, and should have profit-protecting plans in place for any test of the 543.50-545.75 level, if that's tested.

Jeff Bailey : 4/18/2005 11:29:37 AM

Target (TGT) $48.31 +0.64% ... retailer saying all products containting Pseudoephedrine will be placed behing pharmacy counter. Story at this Link

Jonathan Levinson : 4/18/2005 11:26:29 AM

QQQQ intraday 100-tick chart update at this Link , price back below the 7200 tick SMA resistnace at 34.85. So far, the 34.96-.98 area has been a brick wall- bulls need to keep bouncing from higher lows in order to more aggressively attack it.

Jeff Bailey : 4/18/2005 11:22:29 AM

Most Actives ... QQQQ $34.82 +0.23%, SPY $114.49 +0.29%, INTC $22.33 +0.94%, MSFT $24.66 +0.81%, SIRI $5.23 +1.55%, CSCO $17.27 +0.40%, AAPL $35.44 +0.19%, SMH $30.42 +1.70%, ORCL $11.87 +1.45%, AMAT $14.98 +3.37%

Linda Piazza : 4/18/2005 11:20:41 AM

No change in trend yet, although the OEX keeps challenging the resistance that has been holding it back since midday on Wednesday.

Tab Gilles : 4/18/2005 11:20:31 AM

Linda, Nice observation on DD.[10:37:04 AM] Here's an annotated chart. Link

I track the Materials Sector (XLB), heres a DD/XLB chart. Link XLB holdings Link Link

Jeff Bailey : 4/18/2005 11:18:34 AM

Friday's Internals at this Link

Jeff Bailey : 4/18/2005 11:17:23 AM

11:00 Internals at this Link

Jonathan Levinson : 4/18/2005 11:14:28 AM

Daily chart of May crude oil at this Link , testing rising support at 50 after printing a new low for the move overnight at 49.65.

Jeff Bailey : 4/18/2005 11:12:17 AM

CRB Index (cr00y) ... similar to Dollar Index (dx00y) ... no quote feeds coming through this morning.

Linda Piazza : 4/18/2005 11:10:59 AM

Another instance of the 10-minute 21-ema holding as resistance, during the previous 10-minute period. That average is now at 549.30.

Linda Piazza : 4/18/2005 11:09:36 AM

Since I'm anticipating that a bigger retracement at some point and since the OEX's current zig-zagging move is bigger than the previous tight ranges of higher highs and higher lows as it formed each flag, I'm wondering if this flag won't be wider and won't retrace a portion of the whole drop from the 4/12 high rather than a portion of the last drop from the Friday morning high. Hope that makes sense. Anyway, I've snapped a Fib bracket on the decline from the 4/12 high to this morning's low. If there's no new low this morning, the 38.2% retracement of that entire decline lies at about 554.25. We know already from Keltner and historical evidence that 553-554 should be resistance, if they're reached.

Jeff Bailey : 4/18/2005 11:09:06 AM

Sell Program Premium ... SPX 1,145.05, DIA $100.55, QQQQ $34.87

Jonathan Levinson : 4/18/2005 11:06:54 AM

MMM announced earnings of $809 million or $1.03 per share, up from 90 cents or $722 million the year earlier. Estimates were for $1.01 per share, but revenue came in light, rising 4.06% from $4.94 billion to $5.17 billion. Analysts were looking for $5.26 billion. MMM's getting slammed, -5.02 at 76.80, off a low of 76 this morning.

Jeff Bailey : 4/18/2005 11:05:48 AM

Sell Program Premium ... SPX 1,147.04, DIA $100.70, QQQQ $34.92

Jonathan Levinson : 4/18/2005 11:03:03 AM

Volume breadth is positive for a change, with 1.7 NYSE advancing shares for each declinining, 2.7 for the Nasdaq. The Nasdaq TRIN is down to .44, showing strong but not extreme buying pressure.

Jeff Bailey : 4/18/2005 11:01:53 AM

11:00 Market Watch at this Link

Linda Piazza : 4/18/2005 11:00:41 AM

The OEX is attempting that higher low. Not sure if it will hold, but it's trying, as I suspected it would do. (Don't give me too much credit if it does, because I suspected the same thing Friday.) The OEX has not yet erased its breakdown signal on the 15-minute Keltner chart with a close above 549 or even moved above the 10-minute 21-ema, with that average at 549.47, so there's nothing yet that says the trend has changed.

If the OEX should continue to climb and break through those levels, realize that so far, that climb is taking the shape of a back-and-forth movement indicative of measured distribution, making it still appropropriate to look for a rollover point, although perhaps not until a higher climb.

Jeff Bailey : 4/18/2005 10:59:24 AM

I'm not getting any U.S. Dollar Index (dx00y) data feeds. 10:00 AM EDT U.S. Market Watch quote probably incorrect.

Jonathan Levinson : 4/18/2005 10:59:12 AM

QQQQ spikes back up above 7200 tick SMA resistance after finding support at a higher low above the 34.63 morning low. Bulls need a break above 34.97 to above falling into a sideways/narrowing pennant.

Tab Gilles : 4/18/2005 10:59:04 AM

Murphy Oil (MUR) Weekly chart... Link

Daily chart... Link

Jonathan Levinson : 4/18/2005 10:56:34 AM

Session high for gold here, +2.90 at 428.60, with HUI now up 2.07% at 184.29 and XAU +1.74% at 87.89. Crude oil is up .30 at 50.80 for the May contract, off a high of 51.15.

Linda Piazza : 4/18/2005 10:55:12 AM

There's been some discussion about buy-and-hold strategies on the Futures side. Here's what Mauldin and co-author of two chapters, Ed Easterling, have to say about a buy-and-hold strategy, using an analogy of Dallas area weather, an analogy that will strike home to anyone living in Texas:

"Would you like to live in paradise? There's a place where the average daily temperature is 66 degrees, rain occurs on average once every five days, and the sun shines most of the time.

"Welcome to Dallas, Texas. As most know, the weather in Dallas wouldn't qualify as climate paradise. The summers begin their ascent almost before spring arrives. On some days, the buds nearly wilt before turning into blooms. During the lazy days of summer, the sun frequently stokes the thermometer into triple digits, often for days on end. There are numerous jokes above the devil, hell, and Texas summers.

Once winter is in full force, some days are mild and perfect golf weather. Yet others present frigid temperatures, snow, and the occasional ice storm. It's good for business at the local auto body shops, though it makes for sleepless nights for the insurance companies. Certainly the winters don't match the wind chills of Chicago or the blizzards of Buffalo, but the climate in Dallas is far from paradise as its seasons ebb and flow.

"For the year, though, the average temperature is paradise.

"Contrary to the studies that show investors they can expect 7 percent or 9 percent or 10 percent by staying in the market for the long run, the stock markets isn't paradise, either. Like Texas summers, the stock market often seems like the anteroom to investment hell.

"While historically the average investment returns over very long terms of times have been some of the best available, the seasons of the stock market tend to cycle with as much variability as Texas weather. The extremes and the inconsistencies are far greater than most people realize. . . the stock market rarely gives you an average year."

Jonathan Levinson : 4/18/2005 10:51:09 AM

Bonds are rebounding, trading opposite stocks for the past half hour after holding in lockstep for most of the morning, with TNX back down to a 3.8 bp loss at 4.235%. Intraday QQQQ and ZN 10-year bond future chart comparison at this Link

Linda Piazza : 4/18/2005 10:44:03 AM

We're about to see if the higher or equal low holds on the OEX, or whether we'll instead see a test of the 543.50-545.75 next support zone, predicted as such by the weekly Keltner chart.

Jonathan Levinson : 4/18/2005 10:43:52 AM

QQQQ is chopping sideways just below 7200 tick SMA resistance, just enough to stall the young 30 min channel upphase and roll the short cycle over. The longer intraday channel bottoms line up around 34.66 currently- which lines up with the morning lows. A break below that would signal a resumption of Friday's slide.

Jeff Bailey : 4/18/2005 10:41:11 AM

Gamestop (GME) $25.21 +16.70% Link ... surging after announcing it would buy rival Electronics Boutique (ELBO) $56.74 +37.96% Link for $1.44 billion in cash and stock. Analysis: for BOTH stocks to be up this much, a signal from MARKET that it LOVES the deal.

Linda Piazza : 4/18/2005 10:37:04 AM

A while ago, DD broke out of its year's long trading zone, breaking above $45 and then $50.00. I had mentioned the breakout, the then-$65.00 upside P&F target, and the tendency of stocks to establish a new trading zone roughly equal in size to the last one after breaking out. This would have meant a possible 10-point gain for DD. I had mentioned that traders needed to wait for a pullback and that I would be watching for a long entry. I haven't mentioned any such long entry, although DD did pull back to the 50% retracement of the breakout and pause there, because the chart just didn't look right. And it wasn't. DD has pulled back all the way to almost $46.00 this morning, bouncing strongly from its 200-sma as I type. However, this is a nearly complete retracement of its breakout, and sets up the possibility of a H&S on its daily chart. Getting in on the last test of $46.00 as it moved up would have presented strong gains, since it eventually moved above $54.00, but not now. That's why I've been silent on a bullish entry on DD after promising weeks ago to watch for such an entry.

Jeff Bailey : 4/18/2005 10:34:59 AM

Current OPEN MM Profiles at this Link

Jonathan Levinson : 4/18/2005 10:33:56 AM

May crude oil is higher here, up .225 at 50.725.

Jeff Bailey : 4/18/2005 10:30:32 AM

Sirius Satellite Radio (SIRI) $5.30 +2.91% ... back at Friday's opening high.

Linda Piazza : 4/18/2005 10:30:12 AM

The OEX does turn down from the resistance I've been noting. Now we see if there's an equal or higher low or a move to a new low and perhaps toward the next 543.50-545.75 support level.

Jonathan Levinson : 4/18/2005 10:27:12 AM

QQQQ's short cycle is rolling over here, testing 34.85 support 3 cents above the 7200 tick SMA support. A bounce from here would confirm the upturn in the 30 min channel, while a break below will close a short cycle bear trap, targeting 30 min channel support at 34.73.

Linda Piazza : 4/18/2005 10:24:49 AM

The OEX has hit the 38.2% retracement of the last plunge and 15-minute Keltner resistance and approaches the ten-minute 21-ema. It's pausing at the resistance that appeared to be strong on the 15-minute chart. Just as happened Friday, I find myself fearing that any rollover will just be to form a higher or equal low, and so am not confident of suggesting a new bearish entry. I missed the opportunity to make that suggestion Friday. Hope I'm not doing the same today, but the advdec line currently climbs. I see the possibility for a move down to 543.50-545.75 if there is a rollover, but just can't feel good about the possibility for the rollover to that level with the advdec line performing as it currently is. Hope I'm not sorry, as we're still within the post-opex settlement period this morning.

Jeff Bailey : 4/18/2005 10:24:22 AM

Apple Computer (AAPL) $35.30 -0.14% ... my decision to close out both put option open positions was ENTIRELY account management related. Would be looking LONG PUT again on anything above $38.50

Jonathan Levinson : 4/18/2005 10:16:24 AM

QQQQ just printed a bad tick to 35.10, just below the 35.13 confluence that also lines up with the 60 min channel top. Quotetracker users can click on the intraday chart and hit ctrl-shift-H to remove it if it scattered your indicators.

Tab Gilles : 4/18/2005 10:13:46 AM

$VXN Daily chart follow-up to 10:02AM weekly chart. Link

Jonathan Levinson : 4/18/2005 10:12:41 AM

Crude oil has reopened, with the May contract holding its earlier loss, -.15 at 50.35. Gold has advanced while silver hangs at the lows, and HUI and XAU are moving higher, HUI +1.61% at 183.46 and XAU +1.46% at 87.65. Ten year notes have pulled back, TNX up to a .3 bp loss at 4.243%. QQQQ is chasing the 30 min channel top higher, up to 35.00 now with QQQQ on a session high of 34.96.

Jeff Bailey : 4/18/2005 10:10:51 AM

10:00 Internals at this Link

Linda Piazza : 4/18/2005 10:07:45 AM

The OEX rises, pausing currently at the five-minute 21-ema, not having yet risen to the ten-minute version. This is just below the 38.2% retracement of the last plunge, with that level at about 549.22. The 50% retracement is at about 550.10.

Jeff Bailey : 4/18/2005 10:04:07 AM

VIX.X 17.88 +0.16% ... DAILY Pivot Levels ... 13.85, 15.56, Piv= 16.42, 18.13, 18.99.

Jonathan Levinson : 4/18/2005 10:04:36 AM

QQQQ now tests 34.91 resistance, with the 30 min channel showing its first upticks. This should continue to develop into the long-overdue 30 min cycle upphase so long as any pullback bounces from above the 7200 tick SMA support- currently at 34.75.

Tab Gilles : 4/18/2005 10:15:06 AM

Murphy Oil (MUR) Now testing 150-ema. Link Link

Jeff Bailey : 4/18/2005 10:02:48 AM

10:00 Market Watch at this Link

Tab Gilles : 4/18/2005 10:02:03 AM

$VXN Fear has built, but will it go higher? Link

Linda Piazza : 4/18/2005 9:57:32 AM

The OEX's ten-minute 21-ema is at 550.28, with this average having stopped (with minor incursions above it) OEX bounces since midday on Wednesday.

I'm wondering if the OEX might not find resistance at that 549-550 region, but then attempt to find a higher or equal low before attempting a bounce again. If it can't mount a strong bounce that surges through that resistance, that may be what happens. Then we'll have to see if it's successful at holding to a higher or equal low.

Jeff Bailey : 4/18/2005 9:56:05 AM

Bearish put stop alert ... on the one (1) Apple Computer AAPL July $42.50 Put (QAA-SV) at the bid of $8.10.

Jonathan Levinson : 4/18/2005 9:55:23 AM

The Fed has announced a 6.75B overnight repo, for a net drain of 5.25B for the day.

Jonathan Levinson : 4/18/2005 9:54:44 AM

QQQQ spikes up above 7200 tick SMA resistance here. After the morning high of 34.84, next stop is the 30 min channel resistance 7 cents above. Link

Linda Piazza : 4/18/2005 9:54:19 AM

Here's a look at the OEX's daily Keltner chart: Link As I type, the OEX again attempts a bounce. The 15-minute Keltner chart shows resistance gathering from 549.43-550.00.

Jonathan Levinson : 4/18/2005 9:52:19 AM

The Fed's big 12B weekend repo expires this morning, but there's been no announcement yet as to its disposition- should be any minute now.

Linda Piazza : 4/18/2005 9:49:11 AM

Advdec line diving.

Jeff Bailey : 4/18/2005 9:50:20 AM

Apple Computer (AAPL) alert $34.62 -2.03% .... Closing out the two (2) Apple AAPL May $32.50 puts (AAQ-QZ) at the offer of $0.90. Place a profit stop at $8.10 on the one (1) remaining AAPL July $42.50 Put (QAA-SV) $8.50 x $8.60.

Linda Piazza : 4/18/2005 9:47:23 AM

The OEX preserves the breakdown signal on its 15-minute Keltner chart. Resistance has now descended to 549.35-551.20. That resistance currently looks strong enough to stop any bounce, but so far, it's not even getting tested.

Jonathan Levinson : 4/18/2005 9:45:28 AM

Bonds are holding their gains, ten year note yields (TNX) down 4.4 bps at 4.229%, a 1.03% drop. The daily cycle downphase is down to oversold territory, with today's gap lower completely beneath the lower bollinger support at 4.254%. Daily chart of the TNX at this Link

Linda Piazza : 4/18/2005 9:44:21 AM

One problem with the weekly Keltner support that the OEX now approaches is that the OEX soundly violated tha support twice last year. Still, it's there, and could prompt a bounce. We may be looking at an eventual low near 527, but I'm not thinking yet that it will come without a bounce somewhere along the way.

Jonathan Levinson : 4/18/2005 9:43:30 AM

Gold is holding its gains while silver hangs in the red. The miners are up, however, HUI +.53% at 181.51 and XAU +.61% at 86.92. The CRB is up fractionally, +.15 at 298.98, with strength in lean hogs, FCOJ and cocoa futures. May crude oil finished the overnight session -.15 at 50.35.

Linda Piazza : 4/18/2005 9:40:57 AM

The OEX is not holding onto all this morning's gains. We have not seen a big enough bounce to suggest a new bearish entry, unfortunately, that has high odds for success, with next support perhaps at about 547 and then from 543.50-545.75, and then with the possibility of that V-shaped bounce that Keene mentioned earlier. I would consider such a bounce a technical one only until proven otherwise, but that wouldn't mean that it couldn't be sharp.

Jeff Bailey : 4/18/2005 9:43:58 AM

Dow Diamonds (DIA) $100.52 -0.18% ... session low. 3M (MMM) $78.25 -3.22% Link ... lower after posting quarterly net income of $809 million, or $1.03 a share, compared to $722 million, or $0.90 per share in the year-ago quarter. Consensus was a profit of $1.01 per share. MMM also affirmed prior guidance/outlook.

Linda Piazza : 4/18/2005 9:37:50 AM

CNBC commentators were all talking about last week's action in the TRAN, but we've been talking about the TRAN's warning signs on these pages for months, with many of us paying attention to the TRAN's actions. I have been posting charts for weeks showing that the TRAN has been showing signs of being at/approaching a major swing high on a monthly and weekly basis, touching an upper envelope line that usually marks such major swing highs.

Jeff Bailey : 4/18/2005 9:39:32 AM

IMS Health (RX) $24.52 +3.50% Link ... Bear Stearns raising to "outperform" from "underperform."

Jonathan Levinson : 4/18/2005 9:36:48 AM

QQQQ 100-tick chart update at this Link , testing 7200 tick SMA resistance.

Linda Piazza : 4/18/2005 9:33:12 AM

A tepid rise so far on the OEX this morning. Currently, 15-minute Keltner charts show resistance looking relatively strong from 550-550.48. Expect some erratic trading patterns this morning during opex settlement.

Jonathan Levinson : 4/18/2005 9:30:44 AM

Note that the put to call ratio went out at 1.42, and never got south of 1.3 after the opening 1.14 print. These are extreme readers and should be signalling caution for bears. The influence of op-ex Friday no doubt impacted the numbers, and this is a secondary indicator at best, but clear registers as yet another of the shorter term oversold indications we've been noting.

Tab Gilles : 4/18/2005 9:29:10 AM

So...was Friday the bottom?

Perhaps, but my best guess is that it is a tradable bottom. Looking at the $COMPQ, a bounce at the 1900 level would be a 61.8% retracement from the 08/04 low of 1750.

This chart of the $COMPQ/$NAHL weekly with weekly ema (redline) is at -250, buy level. However, the 10 week-ema (blue line) has not yet crossed under the -100 level. I would like to see the MACD crossover and confirm any reversal. I'm expecting a trade bounce here up to the 2000 level. Link

The $NAHL daily chart as I've presented several time last week has not reaced the -100 level. I'd like to see that occur, however, it would not be necessary to have this market rally, just keep an eye on this indicator. Link

Now looking at other factors that have me bullish on the longer term. Interest rates have come down on the $TNX and $FVX. Link Link Inflation is not really a threat as previously thought. Market sentiment, via AAII is at a 13 year low reading of 16% Bullish. The 3 week ma on the AAII is over 160%. Link

Oil has come down from $58. Ge reported earning which grew at 25%! For a slowing economy is that bad? GE is a proxy for our economy and I'd say that with all things considered this market has over reacted and that this week should present a great buying opportunity. That said could the markets go lower? Sure they always go further to the up and downside than we expect.

I posted this SPX chart on Friday and target 1142 as the 61.8% retacement level as the 1st downside target followed by by the 1125, to complete the H&S pattern. Link

Jeff Bailey : 4/18/2005 9:39:05 AM

Adobe Systems (ADBE) $60.66 Link ... marked lower at $55.95. (#3 most active)

Jeff Bailey : 4/18/2005 9:38:39 AM

Macromedia (MACR) $33.45 Link ... #2 among most actives. Stock jumping to $37.60 after Adobe Systems (ADBE) said it would buy the company for $3.4 billion in stock.

Jeff Bailey : 4/18/2005 9:38:14 AM

CV Therapeutics (CVTX) $20.73 Link ... higher at $23.20 and atop this morning's most active list after company announced that a clinical trial found its Ranexa treatment to reduce the frequency of angina attacks in patients compared with a placebo.

Jonathan Levinson : 4/18/2005 9:10:02 AM

So far earnings are looking good today, with positive news from the banks as well as GLW, which upped guidance, and CHKP, which reported a big jump in net profit and beat by a penny. QQQQ is hanging 1 cent below unchanged, coiled below the declining 7200 tick SMA resistance at 34.81. The bounce has left a bullish doji hammer on today's very young daily candle, way too early to attribute any weight to it, and the 30 and 60 min cycle oscillators remain buried in oversold territory. The first step for bulls will be a break of the upper 30 min channel at 34.90, confirmed by a move above 35.00 confluence. 60 min cycle bulls need to see 35.13 resistance broken to break the trending decline in that longer intraday timeframe.

Linda Piazza : 4/18/2005 8:58:30 AM

Friday, the OEX dropped below the important 555.50-ish area (long-term S/R carried over from a monthly chart), hesitated for a while near the 200-sma, and the fell into the close. On the OEX and other indices, technical damage was done. That damage consists of traditional chart analysis, saying that a close beneath the 200-sma is bearish, and Keltner damage, creating a downside breakout on the daily Keltner chart. Without a hard bounce Monday, a Keltner downside target just below 527 is set. If the formation on the daily chart was a H&S with a blunted right shoulder, the downside target would be even a bit lower, giving corroboration to the sub-527 target. Selling rallies continues to be the best tactic to employ, although each day brings the OEX closer to a consolidation or bounce day. After such a drubbing, a several-day bounce wouldn't be unexpected. But will it begin today? After NQ futures dropped to just a touch above 1400 and YM futures dropped to 10,020, they've been bouncing, so we know that investors want to bounce the indices, but do they just want to bounce them long enough to sell after the cash open?

The weekly Keltner chart shows that important support exists from 543.50-545.75, in case the cash open should not follow through on the bounce currently going on in the futures. If there is carryover of that bounce, resistance currently exists from 550.60-551.00, according to the 15-minute Kelter chart and presumably at the 200-sma. Those who want new entries will likely want new bearish entries, so watching for a rollover from one of those levels might be the bet for a new entry. Also watch the ten-minute 21-ema, currently at 551.29. That average has been stopping OEX advances since midday last Wednesday. Logic suggests that it must be time for the OEX to break through that average to the upside and bounce harder for a while, but logic may not play much of a role when a get-me-out mentality might exist.

One special caution: we might see some post-opex volatility early this morning. Be careful of making assumptions too soon this morning. If looking for a rollover play, be aware that the OEX could pause at one of those resistance levels, appear to rollover, and then climb again, if the rollover doesn't happen quickly enough. Be willing to step back out if it appears that a stronger bounce might occur. We're due one sometime or another, and one that could be violent, but one that's likely to be a relief bounce only.

Jonathan Levinson : 4/18/2005 8:22:00 AM

QQQQ made it to a high of 34.84 and has pulled back to 34.72. Bonds remain strong, however, with the cash market opening with TNX down 3 bps to 4.245%, a .66% drop here.

Jonathan Levinson : 4/18/2005 8:04:07 AM

Session highs across the board with all futures green and QQQQ up 3 cens to a high of 34.77.

Jonathan Levinson : 4/18/2005 7:56:48 AM

Positive earnings results from BAC and STI are no doubt contributing to the bounce, with ES ticking positive here to 1143.75. QQQQ is up to a .05 loss at 34.69. BAC reported a 75% jump in Q1 profit y-o-y, citing growth in consumer banking and its acquisition of FBF. Quarterly net income rose from 91 cents per share or $2.68 billion to $1.14 per share or $4.7 billion, which results included a charge of $112 million or 2 cents per share for merger and restructuring costs. Estimates were for 97 cents EPS.

Jonathan Levinson : 4/18/2005 7:29:40 AM

Equities are lower but well off their overnight lows, ES curently trading 1140.25, NQ 1409.5, YM 10051 and QQQQ -.13 at 34.61. Gold is up 2.20 to 427.90, silver is down .013 at a session high of 7.05, ten year bonds are up 28/32 to 111 9/32 and crude oil is down .425 at 50.075.

There are no major economic reports scheduled for release today.

Linda Piazza : 4/18/2005 7:15:23 AM

Good morning. Foreign markets have been bleeding red all night. This weekend was busy with economic and geopolitical meetings. China did not attend the G7 meeting, presumably ducking more pressure to unpeg its currency from the dollar. The G7 meeting resulted in the commentary that has become standard, calling for more global growth, a rebalancing of fiscal imbalances and a need for China to revaluate the yuan. In China, anti-Japanese demonstrations intensified, and a meeting of government representatives did not resolve the differences. The Nikkei lost 3.80% and closed below 11,000, with all other Asian bourses dropping, too. European markets dive this morning. Our futures bleed red this morning, too. However, those futures dropped, steepened the drop near the European open, coiled, and then appear to be attempting upside breakouts out of those coils, with their ability to maintain those upside breakouts as yet unproven. As of 6:27 EST, gold was up $0.50 and crude, down $0.68, to $49.81. More detail about Asian and European markets follows in succeeding paragraphs.

All weekend, newspaper reports had detailed ongoing anti-Japan protests in China, heightened by Japan's seeking of a permanent spot on the U.N.'s Security Council, but also by Japan granting drilling rights in disputed territories. The Japanese Embassy in Beijing had been targeted. Government officials in each country blamed the other for the rancor. The Nikkei plummeted Monday morning and was testing 11,000 by the close of the morning session, but it didn't stop there. It closed lower by 432.25 points or 3.80%, at 10.938.44. One economist blamed the fall on declining interest by foreign investors in Japanese stocks. The Bank of Japan's chief economist spoke out, too, reassuring investors that the current accommodative policy would be continued until certain conditions are met, including the stabilization of the CPI over 0.0%, and he reiterated his previous statements that the mechanizations are in place for a recovery. Losses were broad, as might be imagined, but Japan's largest tanker owner, Mitsui O.S.K. Lines, was hit particularly hard by the China/Japan row. China is Japan's biggest trading partner, according to a Marketwatch.com article.

All other Asian markets declined. The Taiwan Weighted fell 2.94%, and South Korea's Kospi dove 2.35%. South Korea's Samsung fell more than 3%, receiving a downgrade by at least four firms after Friday's Q1 earnings report. Singapore's Straits Times declined 1.98%, and Hong Kong's Hang Seng plummeted 2.08%. China's Shanghai Composite fell 1.58%.

European markets dive this morning, too, with techs and autos being two hard-hit sectors. One economic number released today showed that inflation excluding food, energy, alcohol and tobacco climbed to 1.6% year over year from February's 1.4%, with this number so far staying below the ECB's desired upper limit for price stability. The headline number had risen above the ECB's desired 2%, to 2.1%, with energy costs the main driver to that higher headline number. One media reports suggests that Germany will lower its official GDP forecast for this fiscal year when it publishes its new forecasts later this month. Although there's been a denial by a government official, the government's estimates have been out of line with those of other entities, such as the IMF's. In the U.K., housing prices rose 1.3%, but that resulted in a 7.0% annual rate, still lower than has been seen recently.

In company-specific news, Philips Electronics dropped heavily after reporting earnings that included flat sales and a 79% decline in Q1 profits. M&A speculation swirled around British media group Parson Plc, rumored to be considering a sale of its Financial Times newspaper division, and Vivendi, rumored to be stalled in its talks to establish a shared ownership of one of its units with a French media group. Retailer Gus had reportedly agreed to buy a number of Littlewoods stores, and the gaming sector saw deal talk, too.

As of 6:58 EST, the FTSE 100 had dropped 81.20 points or 1.66%. The CAC 40 had fallen 82.73 points or 2.05%, to 3,949.55. The DAX had declined 103.15 points or 2.39%, to 4,209.10.

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