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Jeff Bailey : 6/8/2005 11:00:24 PM

Program Trading Levels for Thursday ... HL Camp & Company has their computers set for program buying at $+7.86 and set for program selling at $+3.54. Today is rollover and all September contracts are now front month.

Jeff Bailey : 6/8/2005 10:45:15 PM

Pivot Matrix for tomorrow at this Link

Jeff Bailey : 6/8/2005 10:04:07 PM

Current OPEN MM Profiles found at this Link

OI Technical Staff : 6/8/2005 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The Market Monitor has been archived.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.

Tab Gilles : 6/8/2005 4:46:00 PM

20+year Treasury Bond Fund i-share Lehman (TLT) As with the $USB I mentioned yesterday 11:59AM post. I've been looking at some other possible trades as the bond market approaches a possible top in the coming weeks. Yesterday I was looking at the $USB , today I've taken the TLT and have focused in on the Jan 95 put (YLIMQ), here are the annotated charts. Link Link

Jeff Bailey : 6/8/2005 4:45:23 PM

Closing QQQQ Options Chain (update) of today's most active at this Link

Jeff Bailey : 6/8/2005 4:35:27 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 6/8/2005 4:26:48 PM

Closing Internals found at this Link

Jonathan Levinson : 6/8/2005 4:21:01 PM

Headlines:

BUSH: THERE ARE 'TROUBLING SIGNS' IN ECONOMIC OUTLOOK

BUSH: GASOLINE PRICE RISE IS A TROUBLE SPOT FOR ECONOMY

BUSH SAYS WILL STAY FOCUSED ON SOCIAL SECURIT

Jeff Bailey : 6/8/2005 4:18:51 PM

TASER Intl. (TASR) $10.67 -3.52% ... company announcing its support of the Wisconsin Dept. of Justice, Law Enforcement Standards Board's recommendations for training for employment of an electronic control device.

Jeff Bailey : 6/8/2005 4:05:19 PM

Buy Program Premium ... DIA $104.85, SPY $119.95

Jeff Bailey : 6/8/2005 4:04:25 PM

U.S. Dollar Index (dx00y) 87.96 +0.53% ... DAILY Pivot Levels for tomorrow ... 86.79, 87.33, Piv= 87.70, 88.24, 88.61.

Linda Piazza : 6/8/2005 4:00:45 PM

As I thought it might, the OEX punched up to a Keltner line currently at 565.60 to test it, and it also bounced back away from it. As one of the other writers mentioned, bulls were trying to let the clock run out before sellers could take over, and they did it, keeping the OEX above the 564.80-ish level into the close. Ready for a bounce or a breakdown tomorrow.

Linda Piazza : 6/8/2005 3:56:26 PM

You've got a tough decision to make if in an OEX bearish position. Two days when the OEX got pushed back to last-ditch support when it tried to bounce, but then that last ditch support does appear to be holding. I don't take this bullish action, of course, but there's risk of another bounce attempt tomorrow morning, too . . . and there's that broadening formation and its crazy behavior. If the OEX is pushed below 564 before the close, that might be different, but then follow-through might be limited, too. It's a risk either way--not staying in or staying in--and only you can make the decision. Maybe take partial profits at least if you haven't already done this?

Tab Gilles : 6/8/2005 3:55:31 PM

$XAU Link

Jonathan Levinson : 6/8/2005 3:46:54 PM

QQQQ is finally back above 37.70, testing resistance at today's and yesterday's prior support.

Linda Piazza : 6/8/2005 3:46:46 PM

I said earlier that I wouldn't be surprised to see the OEX pop up to the Keltner line that's currently at 565.61 (a little higher then), and it's doing that now.

Linda Piazza : 6/8/2005 3:44:04 PM

The TRAN is still just below the 200-sma by about 6 points. It may be headed down toward a test of the 200-ema and the bottom of its ascending regression channel off the spring lows, with the 200-sma at 3494.69 currently. When the TRAN moves, it moves, doesn't it?

Linda Piazza : 6/8/2005 3:39:57 PM

The OEX clings to 565.80-ish support. The SPX may be key, as it's testing the 6/06 LOD and trying to stay above that.

Linda Piazza : 6/8/2005 3:30:02 PM

The OEX still clings to support. I wouldn't be surprised to see a quick rise up toward 565.87 to test that, but I guess I wouldn't be that surprised to see the OEX drop, either. Those in bearish positions need to consider whether they'll close them out today or keep them overnight and start making plans about what needs to happen to help them make that decision.

Jonathan Levinson : 6/8/2005 3:29:53 PM

NDX volatility (QQV) remains very low, up all of .06 (or .42%) at 14.42, while the CBOE total put to call ratio has been rising, with the latest reading .95 (next due in the next 5 minutes). My guess would be that a higher p/c ratio combined with low volatility reflects more aggressive selling of puts, but when reading these secondary indicators, a guess is all it is.

Linda Piazza : 6/8/2005 3:25:10 PM

The OEX keeps clinging to Keltner and other support between 564.80 and 565.00. Those bears who haven't taken partial profit might do so here. Keltner charts suggest that as long as the OEX is producing 15-minute closes beneath a Keltner line currently at 565.88, it's likely to keep moving lower, but this is an area that has supported the OEX on daily closes for weeks now.

Jonathan Levinson : 6/8/2005 3:13:00 PM

QQQQ continues to drift just above the lows in a likely bear flag. The 30 min cycle remains stalled early in its upphase, while the 60 min oscillators are stalling in oversold territory and showing a bullish kiss. The broader daily cycle continues early in its downphase, a lower low and lower high printed for today.

Jeff Bailey : 6/8/2005 3:11:38 PM

03:00 Internals found at this Link

Jonathan Levinson : 6/8/2005 3:10:37 PM

Ten year note yields finished higher by 2.9 bps at 3.94%, a nominally higher low from yesterday's print. 3.9% remains key resistance for the daily cycle just below. Tomorrow, the Treasury will be auctioning 8B in ten year notes. Daily chart of the TNX at this Link

Linda Piazza : 6/8/2005 3:10:25 PM

SPX testing 6/06 low.

Linda Piazza : 6/8/2005 3:04:58 PM

OEX easing below the 564.80-ish area, but is still in the early week congestion zone. Continue to be careful if in bearish conditions, but so far, so good.

Jeff Bailey : 6/8/2005 3:02:29 PM

03:00 Market Watch found at this Link

Linda Piazza : 6/8/2005 2:59:31 PM

OEX's 562.51 target still set by Keltner channels. Still some tough recent support to get through to get to that target, and that support is about to be tested.

Jonathan Levinson : 6/8/2005 2:50:54 PM

So far a weak, flaggy bounce for QQQQ off the lows despite the uptick in the short cycle indicators. At a minimum, bulls need to regain confluence resistance to 37.75.

Linda Piazza : 6/8/2005 2:44:21 PM

A bounce on the OEX. I knew I didn't trust that setting of a downside target. First resistance at 566.59, and then resistance that should be strong near 567.60. This still doesn't look bullish to me, but then does it look bearish enough to break through that known support? I just don't know.

Jonathan Levinson : 6/8/2005 2:37:19 PM

A perfect mess from the intraday cycles here, with the 30 min oscillators stalling and ticking down from their earlier weak upphase, while the 60 min oscillators are trying to bottom here in oversold territory. A bounce above 37.93 would turn the 30 min cycle back up with a steep bullish divergence from here, and the short cycle indicators are trying to turn as well- but that upper target is nearly 30 cents away. 1st sign of trouble for bears will be a break above the 72 SMA at 37.80, if they can clear the broken triple bottom at 37.72-.74.

Jeff Bailey : 6/8/2005 2:37:17 PM

QQQQ Option Chain most actives (update) at this Link ... VIX.X 12.75 +2.90% at this point with high of 13.11.

Linda Piazza : 6/8/2005 2:32:54 PM

The OEX's setting of a 562.59 downside Keltner target remains tentative, an impression corroborated by known support in the 564.80-ish area. This comes from the 100-sma and the 50% retracement of the March-April slide and recent historical support, too.

Jonathan Levinson : 6/8/2005 2:31:52 PM

July crude closed lower by 1.125 or 2.09% at 52.625. 50-tick chart at this Link

Jonathan Levinson : 6/8/2005 2:30:20 PM

NYSE declining volume has just exceeded advancing volume as well. Currently, declining volume leads 1.01:1 on the NYSE and 1.56:1 on the Nasdaq.

Linda Piazza : 6/8/2005 2:27:54 PM

RUT attempting to bounce, and should find resistance now at the 624-ish level, the breakdown level out of the bigger "b" distribution pattern it formed.

Linda Piazza : 6/8/2005 2:24:18 PM

The OEX is threatening to create a new breakdown signal on its 15-minute Keltner chart with 15-minute closes beneath a Keltner line currently at 565.52. Actually, it did create such a signal with the last 15-minute period, but only minimally and it's trying to stay above that line during the current period, and I'm cautious about these signals just above known support. If that new signal is created, the downside target is 562.60, but we've heard that as a downside target multiple times over the last week without it being met. Next Keltner resistance just overhead and then at 566.84 and then much stronger near 567.50-567.80.

Jonathan Levinson : 6/8/2005 2:22:28 PM

Session low for July crude with 9 minutes to go in the day session, -1.00 to 52.75.

Tab Gilles : 6/8/2005 2:20:25 PM

Murphy Oil (MUR) Long term chart price objective $55 (split adjusted). Entered at $43.50, took some profits at $48.50. Taking some more profits at $52.50. Using 10-ema as stop, currently at $49.54. Link Link

Linda Piazza : 6/8/2005 2:16:14 PM

TRAN below its 200-sma, but only by a couple of points.

Jonathan Levinson : 6/8/2005 2:13:05 PM

July crude is back to the lows, currently -.65 at 53.10. The US Dollar Index continues higher. Link

Jonathan Levinson : 6/8/2005 2:26:41 PM

Headlines:

WHITE HOUSE STICKS WITH 3.4% GDP GROWTH EST FOR 2005

WHITE HOUSE RAISES FORECAST FOR 2005 JOB GROWTH

WHITE HOUSE SEES CPI UP 2.9% IN '05, 2.4% IN '06

WHITE HOUSE: INTEREST RATES TO RISE 'A BIT MORE'

Jeff Bailey : 6/8/2005 2:12:08 PM

02:00 Internals found at this Link

Linda Piazza : 6/8/2005 2:10:39 PM

The OEX now travels down into the congestion zone from earlier in the week, and might now slow in its descent or even mount a bounce.

Linda Piazza : 6/8/2005 2:08:56 PM

SOX dropping below 430, but far still from the low of the yesterday's last 15-minute period, with that at 427.15 and the SOX at 429.18.

Jeff Bailey : 6/8/2005 2:05:54 PM

02:00 Market Watch found at this Link

Linda Piazza : 6/8/2005 2:06:38 PM

The OEX is dropping where short-term bears wanted to see it drop. Remember that there are several types of support in the 564.80-ish level, so have your profit-protecting plans in place. Because formations such as today's that come after a steep drop tend to occur about midway through a drop, I'd expected more downside than 564.80, but what I expect and what happens may be much different. The OEX curently tests 565.71-ish next Keltner support. OEX 567.20-567.70 should be resistance now on a bounce.

Jonathan Levinson : 6/8/2005 2:05:43 PM

QQQQ loses 37.70 support, testing the 60 min channel bottom at 37.67: Link

Jonathan Levinson : 6/8/2005 2:00:38 PM

QQQQ is holding above 37.70 for its third test since yesterday. Bulls need to get back above the 72 SMA at 37.85 to confirm the bounce and stall the ongoing short cycle downphase.

Linda Piazza : 6/8/2005 2:00:15 PM

The OEX punched below yesterday's late-day low (not the LOD) but immediately bounced right back above it. If you're in a bearish position on the rollover from the 567-568 level today and are feeling uncertain about whether you want to stay in such an iffy play, now would be one place you could exit and stand aside. I'm not sure what's going to happen next, but I would expect a possible bounce attempt. The RUT, however, broke way, way below an analogous level so there's the possibility that the OEX could, too. I do understand the difference between the RUT's small caps and the OEX's big caps (smile), but I'm just saying that the formations are similar.

Linda Piazza : 6/8/2005 1:57:17 PM

That 430-ish level is providing support for the SOX again, as it did earlier today.

Jonathan Levinson : 6/8/2005 1:54:36 PM

Session lows across the board.

Linda Piazza : 6/8/2005 1:51:52 PM

The OEX, too, looks as if it's breaking lower, but also needs a new low below yesterday's late-day low of 566.08 to confirm that. Potential Keltner support at 565.88. Remember that this is happening during the typical stop-running time of day, so be careful, but these formations have looked bearish to me today. Just be prepared to protect profit near that 566 level in case they're not that bearish.

Jonathan Levinson : 6/8/2005 1:51:51 PM

Nasdaq volume breadth ticks 1.08:1 negative, in favor of declining volume.

Linda Piazza : 6/8/2005 1:49:48 PM

The RUT may be breaking lower out of its possible flag-like climb today. Needs a new low below the previous 623.78 LOD to confirm that.

Jeff Bailey : 6/8/2005 1:49:45 PM

Sell Program Premium ... SPX 1,198.84 , DIA 105.10, QQQQ $37.80

Jeff Bailey : 6/8/2005 1:48:42 PM

AMEX Gold Bugs ($HUI.X) 184.71 -0.02% ... reverse earlier gains. Break below yesterday's lows.

Linda Piazza : 6/8/2005 1:43:45 PM

SOX breaking below the mid-channel level on the 15-minute Keltner chart and below the rising trendline off yesterday's late-day low.

Jonathan Levinson : 6/8/2005 1:38:02 PM

QQQQ's short cycle downphase has price back below the 72 SMA but within the day's range, overall volume slowing still further despite positive volume breadth. 30 min channel support is just below at 37.77, followed by the 60 min channel bottom at 37.70. Bears need to break the session lows to avoid a likely 60 min cycle bottom's forming in that area.

Linda Piazza : 6/8/2005 1:37:57 PM

The TRAN is dropping lower, perhaps trying to steady ahead of the previous LOD, perhaps trying to reform into a wider and more stable bear flag, as I thought it might do. That's (a bear flag) what I'd consider any formation that climbs unless the TRAN climbs in a strong V-shaped climb. I can't imagine buying transportation stocks and sending it up into a V-shaped recovery after that steep decline, but then it is just above the 200-sma, so perhaps there are those who would do just that.

Jeff Bailey : 6/8/2005 1:36:32 PM

Swing trade short alert .. for Bema Gold (BGO) $2.10 -1.40% here, stop $2.23, target $1.82

Linda Piazza : 6/8/2005 1:32:47 PM

Time for a stop-running move soon. (We hope.) If there's a run to the downside and it holds, then bears have more hope. If there's a run to the downside and there's a big bounce, then bulls do. If the break is to the upside, bulls want to see it hold.

Linda Piazza : 6/8/2005 1:31:10 PM

The OEX's 15-minute Keltner channels are settling into an equilibrium position, so we may not be able to trust what appears to be support or resistance in the mid-channel area.

Jeff Bailey : 6/8/2005 1:26:00 PM

5-year auction ... U.S. Treasury auctioned off $14 billion in 5-year notes including $63.53 million of noncompetitive tenders, down from $233.93 million in noncompetitive tenders accepted at previous 05/11 auction. Bid-to-cover ratio was 2.6. High rate was 3.705%. The high rate of 3.705% was down from 3.890% at previous auction. The high rate was the lowest since 3.618% on 02/09/05.

Linda Piazza : 6/8/2005 1:18:55 PM

Coiling, coiling. That's what the RLX is doing.

Jonathan Levinson : 6/8/2005 1:18:07 PM

Yields are dropping following the 5-yr note auction and its heavy indirect bidder participation, TNX down to a .1 bp gain at 3.912% and the USD Index up sharply: Link

Jeff Bailey : 6/8/2005 1:14:12 PM

01:00 Internals found at this Link

Linda Piazza : 6/8/2005 1:13:18 PM

Dollar attempting a break higher against the yen.

Jonathan Levinson : 6/8/2005 1:13:01 PM

July crude oil held its 53 low, currently up to a 45 cent loss at 53.30.

Linda Piazza : 6/8/2005 1:12:26 PM

Bearish rising wedge? Link Careful, though, as a minimal break of the bottom trendline could see the formation broaden into a rising flag and climb through it again. A day to be careful, certainly, but this formation looks more bearish than bullish to me . . . OEX testing the bottom trendline as I type.

Jonathan Levinson : 6/8/2005 1:09:00 PM

Volume breadth remains flat in positive territory, advancing volume leading declining 2.19:1 on the NYSE, 1.78:1 on the Nasdaq. QQQQ is chopping sideways above the 72 SMA, so far a very weak/corrective 30 min cycle upphase, while the 60 min downphase stalls without reversing. Volume overall is quite light with 40.7M QQQQs traded today, well below yesterday's nearly 110M share volume

Jeff Bailey : 6/8/2005 1:09:28 PM

EMC Corp. (EMC) $14.68 +2.23% ... strong move here. (see prior MM info regarding storage survey)

Linda Piazza : 6/8/2005 1:08:23 PM

TRAN turning down from first Keltner resistance at 3564.42, but as I said earlier, it may be forming into a broader bear flag.

Jeff Bailey : 6/8/2005 1:03:28 PM

01:00 Market Watch found at this Link

Jonathan Levinson : 6/8/2005 1:03:06 PM

The 5-year treasury note auction generated a high yield of 3.705% with a 2.6 bid-to-cover ratio. Foreign central banks took down a very strong 6.9B of the 14B total.

Jeff Bailey : 6/8/2005 12:57:23 PM

July Crude (cl05n)

Jeff Bailey : 6/8/2005 12:56:30 PM

Semiconductor Index (SOX.X) 432.98 +1.27% ... h/o/d, but tentative at WEEKLY Pivot.

Linda Piazza : 6/8/2005 12:55:20 PM

The OEX is moving up toward the 50% retracement of yesterday's plunge off the HOD. This could still be part of a rising wedge shape, but if it breaks too much higher too fast, it would likely be an upside break of this. May just be part of a choppy trading pattern as the OEX's Keltner channels settle into an equilibrium position.

Jeff Bailey : 6/8/2005 12:55:14 PM

QQQQ $37.93 +0.37% ... looking DAILY R1

Jeff Bailey : 6/8/2005 12:54:25 PM

Disk Drive Index (DDX.X) 115.06 +1.54% ... bold move here after "doji day" on Monday.

Jonathan Levinson : 6/8/2005 12:48:01 PM

Big reversal in oil here, July crude down to a new low of 53.00. 50 tick chart at this Link .

Jeff Bailey : 6/8/2005 12:47:32 PM

Global / Oil ... DJ - Venezuela tax chief saying foreign oil companies could owe over $3 billion.

Linda Piazza : 6/8/2005 12:46:57 PM

The TRAN rises to test first Keltner resistance, currently near 3565, with stronger resistance from 3571-3573. The climb looks a little bear flag-ish, but I wouldn't be surprised to see a decline and then reformation into a wider bear flag that's a bit more stable.

Jeff Bailey : 6/8/2005 12:40:25 PM

Caterpillar (CAT) $96.52 +2.10% ... declares 2:1 stock split. Boosts quarterly dividend 22% to $0.50 on pre-split basis.

Linda Piazza : 6/8/2005 12:37:22 PM

The OEX still coils.

Jonathan Levinson : 6/8/2005 12:36:57 PM

QQQQ pulls back to test the pennant apex and 72 SMA support: Link

Jeff Bailey : 6/8/2005 12:33:43 PM

Dow Transports (TRAN) 3,560 -1.45% ... session low so far finds support at my 38.2% retracement. Looking for oversold bounce and 3-box reversal to 3,580. July Crude (cl05n) $54.40 +1.19% has also impacted commercial airlines. Link

Linda Piazza : 6/8/2005 12:25:21 PM

TRAN rising to test first Keltner resistance at 35764.71, with next and perhaps stronger resistance at 3572.84. What I would expect to happen is some back and forth as the TRAN sets up into a rising flag formaton (bearish case) or else a strong zoom up that's not retraced (more bullish case).

Jeff Bailey : 6/8/2005 12:20:34 PM

Current OPEN MM Profiles found at this Link

Jonathan Levinson : 6/8/2005 12:16:34 PM

July crude oil is down to a .425 gain here at 54.175. Ten year note yields are holding their 0.8 bp gain at 3.919%.

Linda Piazza : 6/8/2005 12:14:44 PM

Another morphing of the OEX's coiling pattern. Looking a bit more like a rising wedge, a typically bearish formation. As you see, though, it's dangerous to trust these formations too much, because they've been morphing from one thing into the next all day.

Linda Piazza : 6/8/2005 12:11:54 PM

The TRAN has still not been able to mount much of a bounce, but by one Keltner measure, it's showing a slight bit more strength than it did early. That's just slight, though. The breakout level is still near 3575, with intervening Keltner resistance still near 3566.50.

Jeff Bailey : 6/8/2005 12:09:39 PM

12:00 Internals found at this Link

Jonathan Levinson : 6/8/2005 12:06:22 PM

Session low for ZN bond futures here, -7/64 at 113 53/64, with TNX up .8 bps at 3.919%. 14B in 5-year T-notes will be auctioned today, the results of which are expected at 1PM.

Linda Piazza : 6/8/2005 12:05:50 PM

The BIX is trying to round up into the right shoulder of its potential inverse H&S again now. The neckline of its potential inverse H&S is from about 363.25-363.50, depending on how it's drawn, but with the 200-sma just above that.

Jeff Bailey : 6/8/2005 12:01:49 PM

12:00 Market Watch found at this Link

Linda Piazza : 6/8/2005 11:58:11 AM

The OEX broke over the 38.2% retracement of yesterday's tumble off the HOD, and is now back below that level. It's supported by Keltner support that looks strong, but maybe it's just settling into an equilibrium position on the Keltner charts, so that it could rattle around for a while in a small range.

Jonathan Levinson : 6/8/2005 11:56:44 AM

QQQQ is breaking north out of the pennant here. Upside channel resistance is at 37.97-38.00 on the 30 and 60 min channels: Link

Linda Piazza : 6/8/2005 11:57:01 AM

The TRAN's LOD was a few cents above 3550. It's at 3556.73 now, trying to steady. This was a big breakdown on the 15-minute chart, so it should attempt a bounce at some point, at least up to test the breakout level, which is now at about 3575.26, but there's intervening resistance, too, at 3567.27.

As I typed, the TRAN for the first time today broke over a Keltner line that's currently at 3557.39, so there's at least a tiny hint of a change in tenor.

Linda Piazza : 6/8/2005 11:54:22 AM

The OEX coils, staying mostly below the 38.2% retracement of yesterday's tumble off the HOD, at just below 568. The formation keeps morphing, now looking a bit more like a bullish right triangle than a neutral one, while the SOX's version still looks a bit more like a neutral one. Just have to wait it all out.

Linda Piazza : 6/8/2005 11:44:18 AM

The OEX and some other indices are still coiling. That includes the BIX, its potential inverse H&S now perhaps morphing into something else as they did on many indices. Nothing to do but wait it out, but bulls haven't had any more success this morning than bears did.

Jonathan Levinson : 6/8/2005 11:44:03 AM

Session high for Aug. gold here at 428.30, still testing the 428-429 confluence below the key 432-433 resistance zone. HUI and XAU are both positive, +1.41% at 187.25 and +1.32% at 86.57 respectively.

Jonathan Levinson : 6/8/2005 11:42:29 AM

QQQQ intraday chart updated at this Link with volume declining against an uptrend in the wavelet oscillator. We can expect a pennant break shortly... or a sideways drift through it.

Linda Piazza : 6/8/2005 11:32:33 AM

Just coiling. One of those days when formations keep morphing into something else, perhaps as bulls or bears momentarily gain strength. The OEX's neutralisn't triangle may now be looking more like a bullish right triangle.

Jeff Bailey : 6/8/2005 11:30:55 AM

QQQQ most active options (update) at this Link ... Yesterday's most active QQQQ options at this Link

Linda Piazza : 6/8/2005 11:25:47 AM

Although those earlier inverse H&S's degenerated into other patterns on other indices and time frames, the BIX's five-minute chart shows a potential inverse H&S now. The neckline would be at about 363.40, I think, but remember that the 200-sma is at 363.95. Right now, the BIX is challenging what had served as main support in its consolidation pattern over the last few weeks. The BIX tended to dip below that 362.50 support intraday but to close above it . . . until yesterday. The BIX is at 362.35 as I type.

Jonathan Levinson : 6/8/2005 11:26:50 AM

Volume breadth is positive and off its lows, advancing volume currently leading 2.2:1 on the NYSE and 1.44:1 on the Nasdaq, with the TRIN .73 and the TRINQ .87. With the 30 min cycle downphase stalled and the 60 min still pointing south following yesterday's steep drop, my gut feeling is that a sideways consolidation would favor a 30 min cycle upphase to follow. The doubt comes from the strong daily cycle downphase kick off that could cause the 30 min cycle downphase to trend. If that's going to happen, the session low should fail within the next hour or two.

Jeff Bailey : 6/8/2005 11:20:35 AM

Dow Transport Components (TRAN) update at this Link ... July Crude is 30-min delayed.

Linda Piazza : 6/8/2005 11:15:57 AM

TRAN hit a new LOD. Now about 8 points away from the 200-sma, about 120 points below yesterday's HOD.

Linda Piazza : 6/8/2005 11:15:09 AM

Take a deep breath. After this morning's excitement, at least if you were watching the TRAN's dive, some markets are coiling. The OEX is, turning down below the 38.2% retracement of the decline off yesterday's plunge off the HOD into the closing low, but finding support at the mid-channel level. I think it's going to take a decline below yesterday's late-day low to confirm a breakdown out of that formation. The upside break is perhaps even more difficult to quantify. The 50% retracement of the last plunge is at about 568.58 and the 61.8% retracement at about 569.15.

Jeff Bailey : 6/8/2005 11:15:07 AM

11:00 Internals found at this Link

Linda Piazza : 6/8/2005 11:08:03 AM

TXN may be narrowing its wide consolidation pattern today into a triangle, too.

Linda Piazza : 6/8/2005 11:06:46 AM

The OEX is coiling at the bottom of the drop off yesterday's high, incorporating the bulb of yesterday's "b" distribution pattern into the neutral triangle at the bottom of that decline. Bulls are still trying and the outcome either way is not certain, I don't think.

Jeff Bailey : 6/8/2005 11:05:47 AM

11:00 Market Watch at this Link

Linda Piazza : 6/8/2005 11:05:13 AM

The TRAN still tries to steady, but hasn't been able to build on the climb started during the last 15-minute period. Not yet. If it starts a strong bounce soon, it can probably get through some level of Keltner resistance (these aren't hocus pocus, drawn out of nowhere, but rather based on moving averages and multiples of those), but if it lingers too long, that resistance will have time to firm.

Jonathan Levinson : 6/8/2005 11:04:08 AM

QQQQ is pausing just below its 72 SMA with the short cycle indicators still choppy as a wavelet upphase begins to top out: Link . By comparison, the SOX is looking stronger, on a short cycle upphase and just off its session high. Link

Jeff Bailey : 6/8/2005 11:03:15 AM

Swing trade sell naked put alert ... and ten (10) of the El Paso EP July $10 Puts (EP-SB) at the bid of $0.10. EP $11.17 +6.07% here.

Linda Piazza : 6/8/2005 11:01:36 AM

SOX rising to test mid-channel Keltner resistance at 433-433.70. The SOX dipped too far for its inverse H&S to look classic, but the quick bounce from below 430 back above it left only a candle shadow at the too-low level. Perhaps we can still consider the potential inverse H&S to be valid, but even if it is, it hasn't been confirmed.

Linda Piazza : 6/8/2005 10:59:42 AM

And bears were right to be concerned with the OEX. The OEX has shot up to test the 38.2% retracement of the decline off yesterday's high and also the bottom of that "b" distribution pattern. Not what bears want to see, but it was suggested by the failure to move to a new low. Still not a lot of clarity, to my way of thinking.

Jonathan Levinson : 6/8/2005 10:57:11 AM

Ten year notes edging sideways/lower, with TNX now up 0.9 bps at 3.92% and holding a narrow range for the day: Link . July crude oil is holding most of its gain, +.75 at 54.50.

Jeff Bailey : 6/8/2005 10:57:17 AM

El Paso (EP) $11.23 +6.64% ... surging. Technicals ... has retraced 50% of its Feb-April decline.

Jeff Bailey : 6/8/2005 10:55:11 AM

Arvinmeritor (ARM) $16.92 +17.58% ... specialty products/service provider for light vehicles jumping after upbeat forecast.

Linda Piazza : 6/8/2005 10:55:30 AM

TRAN beginning a bounce this 15-minute period. Keltner lines are skewed, of course, but first Keltner resistance on the 15-minute chart, which works amazingly well for the TRAN under normal circumstances, is at 3568.48, with stronger resistance converging at 3579-3582 and then near 3600. Link

Jonathan Levinson : 6/8/2005 10:47:28 AM

QQQQ update at this Link , bouncing from a nominal new low but close enough to qualify as a double bottom. 72 SMA resistance is down to 37.89, above which a new short cycle upphase will kick off and the 30 min downphase will stall.

Jeff Bailey : 6/8/2005 10:46:47 AM

Buy Program Premium ... SPX 1,200.33 , DIA $105.19, QQQQ $37.81

Linda Piazza : 6/8/2005 10:46:24 AM

There's still the possibility for a rollover on many markets, but not strong corroboration yet (with the exception of the TRAN, of course), and there's danger to bears in that they're refusing to actually move lower than yesterday's late-day lows. The supply and demand is apparently a little more balanced than bears would like. The OEX remains within its broadening formation, so this kind of jumping around and uncertainty is to be expected. Weird trading behaviors are the norm, not the exception, in broadening formations.

Jeff Bailey : 6/8/2005 10:44:10 AM

Google (GOOG) $283.17 -3.41% ... 11th most active

Jeff Bailey : 6/8/2005 10:43:34 AM

10 Most Actives ... JDSU $1.56 +2.63%, QQQQ $37.77 -0.05%, HCBK $11.20 +2.09%, CSCO $19.59 +0.92%, INTC $27.04 +0.67%, SUNW $3.61 (unch), SPY $120.28 +0.12%, IMCL $34.91 +15.81%, SMH $34.47 +0.70%, MSFT $25.48 -0.11%

Jonathan Levinson : 6/8/2005 10:42:59 AM

Headlines:

API: DISTILLATE SUPPLIES UP 3.1 MILLION BARRELS

API: CRUDE SUPPLIES DOWN 13.8 MILLION BARRELS

API: GASOLINE SUPPLIES UP 1.1 MILLION BARRELS

Linda Piazza : 6/8/2005 10:41:06 AM

Danger to OEX bears: the OEX is at that rising trendline, but just will not drop. Not yet. SPX is clinging to 1200 or trying. It's at 1198.85 as I type and needs to get below yesterday's low, I think, before any real drop would begin. Even then, it moves right away into a congestion zone, and has potential Keltner support at 1196.76.

Linda Piazza : 6/8/2005 10:38:34 AM

TRAN slightly below the 50-sma, still above the 200-sma at 3542.64, with the TRAN at 3554.75 as I type.

Jonathan Levinson : 6/8/2005 10:37:54 AM

Volume breadth is still positive, but barely so on the Nasdaq, advancing volume leading 1.04:1, while on the NYSE it leads 1.69:1.

Linda Piazza : 6/8/2005 10:37:37 AM

RLX diving. The RLX is important to the OEX, I believe.

Linda Piazza : 6/8/2005 10:36:59 AM

The BIX has erased most of the day's gains.

Jeff Bailey : 6/8/2005 10:36:25 AM

Sell Program Premium ... SPX 1,198.22 , DIA $105.02, QQQQ $37.74

Linda Piazza : 6/8/2005 10:36:21 AM

SOX dropping back to retest that rising trendline (neckline?) off the 5/27 low. That trendline is at about 430, but there needs to be a drop below yesterday's low before a move back below that trendline is confirmed, I think.

Linda Piazza : 6/8/2005 10:34:30 AM

The OEX gaps below the rising trendline off the 6/06 low, but let's see if it stays there and then reaches a new low below yesterday's or if it bounces right back above that trendline. Bears need to see a drop, badly, and then they need to be prepared for potential support at 565.57, according to the 15-minute Keltner charts, at least.

Linda Piazza : 6/8/2005 10:32:39 AM

CNBC talks about how surprising the crude inventories numbers were, but it wasn't a surprise to big investors in transportation stocks, was it? They've been bailing since yesterday morning.

Jonathan Levinson : 6/8/2005 10:32:11 AM

Oil to a new session high of 54.60, equities diving to new lows with QQQQ tagging 37.71, currently up to 37.73.

Linda Piazza : 6/8/2005 10:31:55 AM

And the TRAN continues lower.

Jonathan Levinson : 6/8/2005 10:31:35 AM

Headlines:

DOE: GASOLINE SUPPLIES DOWN 100,000 BARRELS

DOE: U.S. CRUDE SUPPLIES DOWN 3 MILLION BARRELS

Jonathan Levinson : 6/8/2005 10:30:21 AM

Crude oil leaps to 54.375, a new session high- still waiting for the figures.

Linda Piazza : 6/8/2005 10:29:42 AM

OEX roling down, but not fast enough to please bears who probably would have preferred a new LOD before inventories numbers were released. This makes yesterday's last 15-minute candle below the rising trendline off the 6/06 low look like an aberration. So far, though, mid-channel resistance holds.

Jeff Bailey : 6/8/2005 10:27:32 AM

TASER Intl. (TASR) $10.50 -5% ... turns defensive.

Jonathan Levinson : 6/8/2005 10:27:31 AM

Oil inventory data due shortly. Currently, July crude is down 30 cents at 53.45, off a low of 53.075.

Linda Piazza : 6/8/2005 10:24:21 AM

With the TRAN plunging so steeply, all the way down to test its 50- and 200-sma's, being now just above them, I would think it's primed for at least a technical bounce, no matter what those inventories show. Not sure of that, of course, but wouldn't that seem likely? It is perhaps the type of bounce we see and the size of that bounce that tells us about next direction. I don't know that I'd be all that anxious to buy transportation stocks this morning.

Jeff Bailey : 6/8/2005 10:22:58 AM

Dow Transport Components (TRAN) at this Link ... "truckers" show early weakness.

Linda Piazza : 6/8/2005 10:21:51 AM

Hint of an inverse H&S on the SOX's 15-minute chart, too, with neckline just below the 433.29-433.82 Keltner mid-channel resistance and the SOX currently testing the appropriate right-shoulder area at about 431. SOX bulls don't want to see a drop much below 430 as that would likely invalidate the formation.

Linda Piazza : 6/8/2005 10:20:08 AM

Dow holding up fairly well with its sister index plunging. There's even a hint of an inverse H&S on the 15-minute chart, with the Dow dropping now toward the right-shoulder level. Dow bulls don't want to see a drop below the morning's open, though, as that would invalidate the formation.

Jonathan Levinson : 6/8/2005 10:18:51 AM

QQQQ peeked its head above the 72 SMA but failed 2 cents later, currently back below it. The current decline this morning is choppy and uncertain, with the short cycle indicators similarly directionless. Yesterday's low at 37.73 will be key- a break below it would see a resumption of yesterday's decline, while a higher low this morning would allow the 30 min cycle to begin firming.

Jeff Bailey : 6/8/2005 10:18:07 AM

Yellow Roadway (YELL) $51.16 -3.92% Link ...

Linda Piazza : 6/8/2005 10:18:01 AM

TRAN only a few points above its 200-sma now. It's fallen more than 100 points off yesterday's early morning high.

Linda Piazza : 6/8/2005 10:17:13 AM

The OEX's mid-channel Keltner resistance is holding, but OEX bears really need to see the OEX roll down quickly and move through yesterday's low. Volume patterns sure aren't supporting great confidence in a downturn here, and there's a mixture of evidence from various indicator indices.

Jeff Bailey : 6/8/2005 10:17:17 AM

J.B. Hunt Transport (JBHT) $18.24 -8.14% Link ...

Linda Piazza : 6/8/2005 10:15:35 AM

Yesterday, the RLX spiked up a little more than a point above the top of January's huge gap, but it was slapped back down, and it's now back within the consolidation pattern it's been forming since Thursday. Friday's big bearish engulfing candle at the top of a climb should have resulted in a decline, but it didn't. Monday was an inside day. Yesterday's push above the high of the inside day should have been a bullish signal, but the RLX fell back. A lot of confusion from chart signals here, but this index is important to OEX behavior, too, so I'm watching.

Jeff Bailey : 6/8/2005 10:11:40 AM

10:00 Internals found at this Link Yesterday's Internals found at this Link

Linda Piazza : 6/8/2005 10:10:12 AM

TRAN at the midline of its rising regression channel it's been in since April, holding juusst above the 50- and 200-sma's. It looks as if it's broken below its broadening formation, but looks can be deceiving in these.

Jeff Bailey : 6/8/2005 10:07:58 AM

VIX.X 12.29 -0.80% ... DAILY Pivot Levels ... 11.16, 11.78, Piv = 12.09, 12.70, 13.02.

Linda Piazza : 6/8/2005 10:07:19 AM

SPX facing many types of resistance here at 1200.74, of course, including Keltner resistance up to 1201.80.

Linda Piazza : 6/8/2005 10:05:38 AM

SOX moving up to challenge the HOD and then Keltner resistance near 433-434.

Jonathan Levinson : 6/8/2005 10:05:05 AM

Volume breadth is positive today, advancing volume leading declining 2.31:1 on the NYSE and 2.4:1 on the Nasdaq with the TRIN and TRINQ in neutral bullish territory, .77 and .72 respectively.

Linda Piazza : 6/8/2005 10:04:50 AM

TRAN still dropping. Kind of amazing to watch.

Jonathan Levinson : 6/8/2005 10:03:12 AM

Ten year treasury yields currently +.4 bps at 3.915%.

Jeff Bailey : 6/8/2005 10:02:50 AM

10:00 Market Watch found at this Link

Linda Piazza : 6/8/2005 10:02:11 AM

OEX turning down, only slightly, from mid-channel Keltner resistance.

Linda Piazza : 6/8/2005 10:01:42 AM

TRAN still dropping.

Jonathan Levinson : 6/8/2005 10:01:36 AM

Wholesale inventories +.8%, est. .4%, prior revised up from .4% to .6%.

Linda Piazza : 6/8/2005 10:01:17 AM

The TRAN's 50-dma and 200-sma aren't far below, at least at the rate that the TRAN is moving, at 3555.82 and 3542.72. That could be a bounce point, of course. The TRAN is moving lower within a bearish broadening formation, so you can't necessarily trust this "breakdown."

Jonathan Levinson : 6/8/2005 10:00:47 AM

The Fed has announced a 3.25B overnight repo against no expiries today, for a net add in that amount.

Jeff Bailey : 6/8/2005 10:15:08 AM

Landstar System (LSTR) $31.31 -6.70% Link ... transportation service provider downgraded at Bear Stearns to "peer perform" from "outperform," with firm citing less near-term upside potential. Bear saying while it still sees potential upside to current earnings estimates based on continued gross and net operating margin from increasing transportation yields, it expects gross revenue growth to continue to decelerate.

Linda Piazza : 6/8/2005 9:59:46 AM

As it very often does, the TRAN is moving big ahead of the release of the inventories numbers. This time, it's moving big to the downside, having fallen below 3600 this morning and dropping all the way to 3571.96 as I type. There's been a Keltner breakdown. The TRAN sometimes continues and sometimes reverses such moves after the release of the inventories numbers--just depends on what those numbers are and what the market expected. Apparently some are fearful that the numbers won't be a plumped up as some had thought.

Jonathan Levinson : 6/8/2005 9:59:20 AM

Back. QQQQ bounced off the lower 30 min channel support at 37.80, currently testing 72 SMA resistance at 37.90: Link . 30 min cycle bulls need to clear that level for a retest on 37.97-38.00 confluence, above which the 30 min channel should turn up.

Linda Piazza : 6/8/2005 9:58:02 AM

Keltner resistance for the OEX from 567.56-567.99. Bears want to see that hold on 15-minute closes, as it did earlier this morning. Bulls want to see the OEX run up higher and hold above that resistance zone.

Linda Piazza : 6/8/2005 9:56:37 AM

The advdecv is now moving the same direction as the advdec line--up. The OEX is moving up, too, back into that mid-channel and historical Keltner resistance.

Linda Piazza : 6/8/2005 9:54:37 AM

BIX making big gains this morning, but testing Keltner and 200-sma resistance. RLX going a little big of everywhere, but ending up near the day's start. It tried a move up and fell back, and then a move down and leaped up.

Linda Piazza : 6/8/2005 9:52:48 AM

I'm not used to watching TXN on a 15-minute Keltner chart, but it leaped right up into a snarl of central channel Keltner lines this morning and it is getting snarled there, from 27.70-27.88, on 15-minute closes.

Linda Piazza : 6/8/2005 9:51:09 AM

SOX trying to rise again. Currently inching above a trendline drawn off the lows since 5/27, a line that had formed a neckline for a rough H&S.

Linda Piazza : 6/8/2005 9:42:46 AM

OEX dropping back from central Keltner resistance and from the bottom of yesterday's "b" distribution pattern.

Linda Piazza : 6/8/2005 9:42:12 AM

SPX dropping back from a Keltner line at 1201.15 (and another at 1201.92) on the 15-minute chart.

Linda Piazza : 6/8/2005 9:40:15 AM

OEX testing Keltner resistance from 567.56-568.02. Bears want a 15-minute close below the highest of these, at least. Bulls want a 15-minute close above them. The zooming movements over the last 24 hours have skewed these Keltner channels, however, and I'm not sure they're as useful as they should be. If internals were more corroborative, this would have been a good place to test a short, but the advdec line still shoots higher, although my chart shows that advdecv heads down. Some doubt, then?

Linda Piazza : 6/8/2005 9:37:58 AM

BIG, TXN-propelled bounce on the SOX. Keltner resistance coming up near 433-434, with the SOX at 432.26 as I type.

Linda Piazza : 6/8/2005 9:36:59 AM

BIX bouncing strongly, testing 200-sma and Keltner resistance from the underside. RLX can't hold onto its gains.

Linda Piazza : 6/8/2005 9:33:45 AM

The OEX tests Keltner resistance and also the bottom of yesterday's "b" distribution pattern. A rollover here might suggest an eventual test of 562.46, but I'm not getting a strong feeling either way yet from the internals or other developments.

Linda Piazza : 6/8/2005 9:31:39 AM

OEX bouncing right away toward Keltner resistance at 567.56-568.00.

Linda Piazza : 6/8/2005 9:10:37 AM

First, before I provide this update, I want to caution that there are multiple possibilities for market-moving events this morning. We have economic numbers at 10:00, as Jonathan has already noted, and crude inventories numbers at about 10:30. The U.S. dollar is showing signs of trying to steady this morning, although I'm far from certain those efforts will be successful. In addition, some big moves are going on with European bonds, particularly German ones, and I'm not certain whether those moves (moves into bonds and out of equities, some theorize) will be echoed here, too, or opposed, if European bonds are being favored over U.S. ones. Those compose lots of different permutations of underground forces to be applied to our equity markets today. As I've noted before, I'm no economist and don't have a wide background in these areas, but that doesn't mean that I'm going to ignore the possibility that some of this could be working to either support or pressure our equities.

Now for the update. Yesterday morning, the OEX moved back up through its broadening formation, momentarily piercing the top rising trendline and then dropping right back through the formation. It left a bearish long upper candle shadow. However, the OEX ended the day still within the formation, although near the bottom. It ended just below daily Keltner resistance at 566.49, the third day in a row that it's ended below that resistance. As long as it's closing beneath that resistance, it still looks vulnerable to 560.49-562.23 daily Keltner support. Currently, that 560-ish and above support looks strong enough to support the OEX, if tested. Those in a bearish play should know ahead of time how they'll deal with that level if it's tested. That could also be an appropriate right-shoulder area for the potential inverse H&S on the daily chart, another reason to protect profits in that area.

The best bearish entry was yesterday's fall back through 570 after topping that level or else the breakdown out of the "b" distribution pattern formed yesterday afternoon after the first steep drop. If the OEX should test 567.50-568 and round down from that this morning and if internals support such a play, another new bearish entry might be offered, but be very careful with such entries while the OEX is within that broadening formation. There's the possibility this morning, with today's higher futures levels, that the OEX is going to climb right up through that broadening formation again, but with potential resistance in the 568-569-ish level and with the rise already possibly underway near the open, and with yesterday's quick zoom down again, I don't know that I'd risk an early morning long entry ahead of inventories numbers. I'm growing less and less certain of whether that 566-570-ish range will hold and whether buying support and selling resistance at the boundaries will remain a good idea.

Jonathan Levinson : 6/8/2005 8:46:54 AM

I need to step out of the office and won't be back until 10AM.

Jonathan Levinson : 6/8/2005 8:39:39 AM

QQQQ is holding the bulk of its gains, currently pulling back from the declining 72 SMA below 38.00. The current bounce is so far reflected only as a short cycle upphase which should be growing tired by the opening bell. The 30 and 60 min cycle downphases yesterday generated solid traction and are not yet oversold, suggesting that any short cycle bounce should be corrective here. All of this is occurring within the broader context of the daily cycle downphase, which is still very young and has plenty of room to run. On the bullish side, that downphase, only a few sessions old, could be taking the shape of a bull wedge projecting back to Friday's highs, but there are too few data points to lend any confidence to the interpretation. If yesterday's highs get taken out on high volume, that may be what's going on. Daily NQ chart at this Link

Jonathan Levinson : 6/8/2005 8:31:01 AM

We will get the EIA petroleum inventory data for the latest week shortly past 10:30 today, with Reuters citing analyst expectations for a 300K barrel increase in crude supplies and a 600K barrel increase in gasoline supplies.

Jonathan Levinson : 6/8/2005 8:27:34 AM

September ZN bond futures (ZNU5) are trading a session low, -1/32 at 113 29/32, with TNX up 0.5 bps at 3.916%, at the middle of yesterday's range. A lack of significant downside in the ten year yield/upside in the ten year bond should see the daily cycle turn more decisively up- yield bears/bond bulls would need a retracement of Friday's TNX bounce from 3.8%. So far, however, the 3.9% support line has been firm. Daily chart at this Link with today's candle a small green dot, a couple of minutes old.

Jonathan Levinson : 6/8/2005 7:57:12 AM

Session low for July crude oil, -.65 at 53.10.

Jonathan Levinson : 6/8/2005 7:41:46 AM

Equities are up, ES trading 1202.75, NQ 1542, YM 10532 and QQQQ +.18 at 37.97. Gold is up .70 to 427.5, silver -.022 at 7.421, ten year notes +3/16 to a session high of 113 49/64.

We await the 10AM release of Wholesale Inventories for April, est. +0.4%.

Linda Piazza : 6/8/2005 7:10:35 AM

Good morning. Overseas markets have been somewhat bifurcated overnight. The Nikkei and other Asian markets tended to gain, while this morning, European markets tend to decline. One article attributes the European declines to a move into European bonds, particularly German ones. Our futures are positive, drifting sideways up into the European open and then bumping higher. As of 6:56 EST, gold was up $0.20, and crude, down $0.61 to $53.15. More detail about Asian and European markets follows in succeeding paragraphs.

The Nikkei zoomed up in early trading Wednesday. It drifted sideways to slightly down the rest of the day, but closed higher by 63.58 points or 0.57%, to 11,281.03. Semi-related stocks performed well after TXN's update after the close Tuesday. Goldman Sachs raised ratings on two non-bank financial stocks and other similar issues saw gains, too. The May 1-20 trade balance revealed that exports rose 6.3% year over year, and imports zoomed 23.1%. A measure of money supply growth and liquidity showed money supply growth slowing from April's and liquidity dropping. One article thought this slowing in liquidity measures could perhaps be pegged on something other than comparisons with stronger comparisons from the year-ago period, and thought the numbers ought to be monitored. Another article noted that central bank officials are studying the effect of a fall in the euro/yen pair on Japanese exporters.

Most other Asian markets gained, too. In addition to the TXN news, Samsung Electronics' statement that supplies of NAND semiconductors will cause shortages and an analysts' statement that supply will not be able to meet demand for NAND semiconductors throughout this year helped to support semi-related stocks throughout Asia. The Taiwan Weighted gained 0.92%, and South Korea's Kospi gained 0.55%. Singapore's Straits Times dropped 0.39%, however, but Hong Kong's Hang Seng gained 0.44%. China's Shanghai Composite gained a whopping 8.21%. Speculation arose that the government is taking steps to push up stock prices after the recent decline to eight-year lows. Last week, one day's gains were similarly attributed to an article in which the government was seen to be urging buying of equities. This week's announcement was a change in the government's policy, allowing companies to buy back and write off their own shares. Of course, the government had helped to trigger the sell-off, at least in part, by acting to sell off some of the non-tradable shares it owned.

European markets turn lower, with some reports noting that some investors are piling into European bonds. This morning, the German 10-year is seeing its yield drop further after breaking a key 3.20% level earlier this week, and one article notes that European bonds outperform even the U.S. ones. Semi-related stocks perform well, both due to TXN's performance and a UBS upgrade of STMicroelectronics. Despite that sector performance and an easing in crude prices ahead of today's inventories numbers, company news hits sentiment. The U.K.'s William Morrison Supermarkets fell heavily in early trading after noting its difficulties integrating Safeway and warning of the impact that would have on earnings. French cognac manufacturer Remy Cointreau eased lower after disappointing in its earnings. Other news was better, although some stocks reacted to good news by staying steady rather than gaining. Siemens was one of those, steady after Morgan Stanley raised its price target. IAC/InterActiveCorp has divested itself of a 5.4% position in Vivendi Universal Entertainment, with the unit now 100% owned by NBC Universal. Vivendi was steady. The U.K.'s Royal Bank of Scotland rose after it updated, and European airline Air France-KLM rose after announcing passenger figures for May.

As of 6:51 EST, the FTSE 100 had dropped 16.20 points or 0.32%, to 5,009.00. The CAC 40 had dropped 5.06 points or 0.12%, at 4,175.68. The DAX had declined 8.55 points or 0.19%, to 4,557.46.

Jeff Bailey : 6/8/2005 3:55:46 AM

Oil + Yield + Dollar = SPX (Update) montage at this Link ... cursor tracking set at this afternoon's weakness in the SPX.X. I (Jeff Bailey) would have to think either option expiration related (morning and afternoon action), or somebody knows something about tomorrow's energy data inventory figures (afternoon action).

Jeff Bailey : 6/8/2005 3:22:38 AM

China's Shanghai Composite ($SSEC) 1,115.58 +8.21% Link ... Global markets Link Texas Instruments (TXN) earnings and comments cited for gains.

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