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OI Technical Staff : 7/8/2005 9:59:59 PM

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Jeff Bailey : 7/8/2005 7:03:20 PM

Just seeing Jonathan's 03:06:09 post regarding May consumer credit figures. I would think June figures also show some decline after a strong round of mortgage refinancing. S&P Retail Index (RLX.X) 454.73 +1.29% looks like it is setting up for a bullish holiday shopping season. Link

Jeff Bailey : 7/8/2005 6:47:04 PM

Pivot Matrix for next week at this Link

Jeff Bailey : 7/8/2005 6:39:10 PM

Closing U.S. Market Watch at this Link

Linda Piazza : 7/8/2005 4:58:16 PM

Just noticed that the Wilshire 5000 closed above the March and June intraday highs, at 12,115.55. It did not close much above those highs, however, and so could still be within a testing zone. Something to watch Monday.

Jeff Bailey : 7/8/2005 6:16:41 PM

Closing Internals found at this Link

Jonathan Levinson : 7/8/2005 4:15:30 PM

Session high for NQ futures here as another round of shorts hits the silk.

Jeff Bailey : 7/8/2005 4:11:56 PM

Current OPEN MM Profiles found at this Link

Trade Blotter of July CLOSED trades at this Link

Linda Piazza : 7/8/2005 4:00:06 PM

The OEX finished the day above the important 100-sma, below 567-568 resistance, but it was really a remarkable day.

Linda Piazza : 7/8/2005 3:51:38 PM

The OEX hit its 15-minute upside target and also that 567-568 S/R zone. It's pulling back now, but it would have to have a 15-minute close beneath the trendline currently at 565.95 before it even began to signal the barest change in uptrend.

Jonathan Levinson : 7/8/2005 3:43:16 PM

QQQQ's daily cycle is on a fresh buy signal from oversold territory, while all intraday cycles, from 60 min on down to the wavelet cycle, are buried/maxxed out or trending in overbought. A correction is due... as of a few hours ago, but within the context of the daily cycle upturn, the expectation would be for a higher low to mark the 30/60 min cycle bottoms. Yesterday's bullish doji reversal on high volume remains a good candidate for the daily cycle bottom.

Linda Piazza : 7/8/2005 3:43:01 PM

When the OEX moved above the 100-sma today, it also moved back above the 50% retracement of the decline from the March high into the April low, with that retracment level at about 564.83. The OEX now moves into a congestion zone from May and early June, and up toward the important 567-568 S/R zone that's been in place for a long, long while. The broadening formation from May and early June formed along an axis along that S/R zone, for example. The February 22 and 23 lows were 567.20 and 567.25. The April 8 and 12 highs were 567.02 and 567.04. Need I go on? Bulls need to see that 100-sma hold into the close.

Linda Piazza : 7/8/2005 3:36:19 PM

Currently, the SOX tests a descending trendline off the 12/03/04 high. The SOX breached that descending trendline on 6/23, but then fell back. The trendline is at about today's high to 442, but that's a long trendline and if I'm off just a touch in drawing that trendline, it could be a little higher or lower. I don't think the upside break would be confirmed until there's a move above that 6/23 high, perhaps.

Linda Piazza : 7/8/2005 3:30:35 PM

We won't know until the end of the current 240-minute period, but the RUT is attempting an upside breakout above the top channel resistance, now at 659.27. If that breakout is extended into the close, I'd then begin looking at a daily chart for a target, with the daily chart now showing a possible upside target of 673.34.

Linda Piazza : 7/8/2005 3:26:50 PM

RLX is bouncing from just above that 10-minute 21-ema.

Jeff Bailey : 7/8/2005 3:26:17 PM

Bullish swing trade long alert ... for 1/2 bullish position in shares of Internet Initiative Japan (IIJI) $9.26 +23.3% here, stop $8.90, target $10.50.

Linda Piazza : 7/8/2005 3:25:44 PM

According to QCharts, the advdec line is 3105, its highest value since 6/07.

Linda Piazza : 7/8/2005 3:23:56 PM

The SPX was one of the indices that had a reasonable-looking H&S on its daily chart. Unless it pulls back below 1,200 into the close, that formation may be in the process of being invalidated.

Jonathan Levinson : 7/8/2005 3:22:05 PM

The market has steadfastly refused to back off, holding just off the highs with QQQQ's 30 min channel top rising to 37.78. Bears need a break below the 72 SMA, now at 37.52 and 3 cents above daily R2. The short cycle indicators show another bearish divergence, but in trending mode, that's more the rule than the exception as price works its way higher.

Linda Piazza : 7/8/2005 3:21:56 PM

The TRAN has reached its 30-minute Keltner target. No appreciable pullback yet, but it's pausing at that target.

Tab Gilles : 7/8/2005 3:16:16 PM

$XOI/XLE/MUR Link Link Link Link

Linda Piazza : 7/8/2005 3:14:28 PM

Okay, OEX bulls. I know I've been warning you ever since the OEX moved above its 200-sma, and even some before that, but now you need to know what you want to do at the end of the day. You need to know now in case a sell-off should begin in the last minutes of trading. Will you hold over the weekend? That would scare me, with the advdec line where it's been today and hurricane and other risks this weekend, but then we haven't had the close today and who knows where the close could be. If you're not going to hold over the weekend, how are you going to exit? Going to ride it out to the end, just inching up your stops so you get taken out before the OEX drops too far, if it does start dropping? Make up your mind now.

Linda Piazza : 7/8/2005 3:10:35 PM

As long as the OEX maintains 15-minute closes above a Keltner line currently at 565.37, it has an upside target of 566.93. Does that OEX 15-minute climb ever look overextended, though!

Jeff Bailey : 7/8/2005 3:09:50 PM

03:00 Internals found at this Link ... greatest number of NHs at the big board since 03/04/05 and 427.

Jonathan Levinson : 7/8/2005 3:06:58 PM

Consumer credit fell -3B vs. a 4B expected rise.

Jonathan Levinson : 7/8/2005 3:06:09 PM

Headlines:

CREDIT DROP IS RARE, FIRST SINCE NOVEMBER 2003

U.S. MAY REVOLVING CREDIT RISES 1.1%

U.S. MAY NONREVOLVING CREDIT FALLS 3.4%

U.S. MAY CONSUMER CREDIT FALLS 1.7%

Jonathan Levinson : 7/8/2005 3:04:34 PM

Headline:

U.S. MAY CONSUMER CREDIT FALLS 1.7%

Linda Piazza : 7/8/2005 3:04:00 PM

Today, the RUT has moved above its late-December high of 656.11. Bulls want to see it stay above that level on today's close to avoid the possibility of a double-top formation. The RUT is at 660.59 as I type and facing 240-minute Keltner resistance.

Jeff Bailey : 7/8/2005 3:01:53 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 7/8/2005 3:01:51 PM

Volume has strengthened, nearing its best levels of the session for the Nasdaq with advancing volume 6.29:1 over declining. On the NYSE, it's 3.4:1.

Tab Gilles : 7/8/2005 3:00:36 PM

Update to 7/6 6:24PM post on $NASI Buy call. Using the Profund UOPIX and USPIX funds. Link Link Link

Jeff Bailey : 7/8/2005 2:58:41 PM

Dow Transports (TRAN) 3,584 +1.85% Link ... trying to reclaim their rising 200-day SMA.

Linda Piazza : 7/8/2005 2:52:27 PM

The RLX is so far maintaining values above its 10-minute 21-ema, with that average at 453, and the RLX at 453.91. Still watching. Bulls want the RLX to keep bouncing from that average.

Jonathan Levinson : 7/8/2005 2:50:07 PM

Ten year notes are selling more aggressively now, down to 112 3/64, TNX up 7.8 bps at 4.109%, +1.94% today. Next resistance is at 4.14% following the break of 4.10% resistance.

Jonathan Levinson : 7/8/2005 2:48:33 PM

August crude close -1.125 at 59.60. Updated 50 tick chart at this Link

Jeff Bailey : 7/8/2005 2:48:57 PM

Symantec (SYMC) $21.97 +2.95% Link ... might be a bullish trade if COMPX Link can get the 2,100 close.

Similar MACD setups. SYMC could dart toward 200-day SMA next week.

Jonathan Levinson : 7/8/2005 2:47:31 PM

The short cycle indicators are set up for a bearish divergence on this higher high if QQQQ returns to daily R2 from here. 30 min channel resistance is in play, but the 30 min cycle appears to be trending as well. This action all confirms the daily cycle upturn, but in the meantime, the intraday cycles are due for a correction. Link

Linda Piazza : 7/8/2005 2:37:13 PM

I find days like today painful. As I said earlier, it's not that my personal positions are threatened, with the possible exception of a RUT bear call position if this keeps up next week. I wouldn't find this painful, either, if I were in a bullish OEX trade or had recommended one to readers, but I really do believe we have to wait for a close above that 100-sma before we get too bullish here. (Don't believe me? Then look at 6/28 & 29.) The waiting is just frustrating while the OEX is zooming higher and I know I could have told readers this morning to expect a climb all the way up through the recent consolidation pattern rather than having told them I didn't know what would happen after the test of the 200-sma, which I did expect to happen. Plus, this just moves the OEX right back inside that broadening formation and all the congestion from May and early June. So, I'm on the sidelines, waiting until the close, anxious to examine charts after we see what the close brings us, a little skeptical with the advdec line showing a bit too much exuberance (IMO) in light of this week's events and a hurricane that might impact crude costs, etc.

Jeff Bailey : 7/8/2005 2:36:41 PM

I wonder if Keene knows if there's a "PPT" for the gold bugs (did you read last night's Wrap)? HUI.X 199.60 -0.30% ...

Jonathan Levinson : 7/8/2005 2:29:52 PM

Session low for ten year notes at 112 13/64, TNX up 6.4 bps at 4.095% here. Crude oil has dived into the close, -1.125 at 59.60 with seconds to go.

Jeff Bailey : 7/8/2005 2:28:22 PM

If anyone is questioning my QQQQ short profile from yesterday .... I don't blame you at all.

Linda Piazza : 7/8/2005 2:27:21 PM

SOX finally approaching the 30-minute upper Keltner resistance, now at 440.43. It's now at 440.00. Earlier this morning, I was doubtful of the 30-minute target being met because of the shape of the candles, but it's chugged up there after all.

Jeff Bailey : 7/8/2005 2:27:50 PM

NASDAQ Comp. (COMX) 2,104.30 +1.37% Link (10-point box) ... threatens a close above the 2,100 level.

NASDAQ Comp. Bull % ($BPCOMPQ) was reading strongest since turning up Link ... probably gets another "X" tonight.

Linda Piazza : 7/8/2005 2:23:57 PM

The RUT now nearly touches the 240-minute upside target of 658.72, with the RUT now at 658.43. Link

Linda Piazza : 7/8/2005 2:22:16 PM

The TRAN approaches the 3584.43 upside target on its 30-minute Keltner chart. It's at 3584.48 as I type.

Linda Piazza : 7/8/2005 2:21:33 PM

RLX bounced from above the 10-minute 21-ema, not even making a close approach before heading higher. On the 15-minute chart, it's going nearly straight up.

Jeff Bailey : 7/8/2005 2:23:39 PM

Internet Initiative (IIJI) $9.17 +22% Link ... big volume today of 10-million plus. Recovering from recent gap down on news that the company suspended IPO in Japan on lack of interest. Today's high of $9.22 marks a 38.2% retracement of recent decline.

Jeff Bailey : 7/8/2005 2:18:56 PM

02:00 Internals found at this Link

Jonathan Levinson : 7/8/2005 2:17:00 PM

QQQQ tests upper flattened 30 min channel resistance here at 37.64.

Jonathan Levinson : 7/8/2005 2:13:28 PM

Session low for August crude oil at 60.10, .625, with 17 minutes left in the session.

Linda Piazza : 7/8/2005 2:12:24 PM

OEX maintaining values above the 100-sma.

Tab Gilles : 7/8/2005 2:10:29 PM

General Electric (GE) Link

American Int'l Group (AIG) Here's a chart I posted back on 6/21. Link

current chart... Link

Jeff Bailey : 7/8/2005 2:06:54 PM

SPY $120.97 +0.85% Link ... I didn't notice yesterday's huge volume. I did notice yesterday that the low didn't quite hit the $118.17 level (large blocks from early April). Look at that MACD trying to curl above zero. Oooooeeee!

Jeff Bailey : 7/8/2005 2:03:30 PM

02:00 Market Watch found at this Link

Jonathan Levinson : 7/8/2005 2:01:30 PM

Hoenig's statement could obviously have very bullish implications, suggesting that the Fed is in less of a hurry to continue its rate raising campaign. QQQQ is printing a session high here.

Jeff Bailey : 7/8/2005 2:00:49 PM

Gander Mountain (GMTN) $12.18 +5.54% Link ...

Jeff Bailey : 7/8/2005 1:58:21 PM

Cabela's (CAB) $21.96 +3.09% ... challenges its trending lower 200-day SMA. Link

Linda Piazza : 7/8/2005 1:58:14 PM

Forgot to mention earlier that the TRAN not only invalidated the potential H&S on its 30-minute chart, but also did not spend any length of time at the right shoulder area before it shot up and invalidated the formation. Most times, even if it's going to be invalidated, there's some hesitation at the right shoulder level. There was one 30-minute small-bodied candle and that was it. The TRAN is rushing up toward a test of its 200-sma and perhaps more important 100-sma, at 3578.52 and 3600.68, respectively. The TRAN is at 3569.09 as I type.

Jonathan Levinson : 7/8/2005 1:58:04 PM

Headlines:

FED'S HOENIG: U.S. ECONOMY IS STRONG

FED'S HOENIG: FOMC CAN 'LIVE WITH' CORE CPI INFLATION

Jonathan Levinson : 7/8/2005 1:54:08 PM

QQQQ volume has just made it to 1/2 of yesterday's 120.2M share total.

Jonathan Levinson : 7/8/2005 1:49:52 PM

August crude oil is back to a .275 loss at 60.45. The last bounce failed at a lower high below the current 61.85 session high. 50 tick chart at this Link

Jonathan Levinson : 7/8/2005 1:47:27 PM

The SOX is edging lower while QQQQ just slides sideways along daily R2. The 72 SMA has made it up to daily R1 at 37.33, with 30 min channel resistance peaking at 37.60. The bears should be applying more pressure than they have so far here at the top, which suggests that the current consolidation could be a bull flag. The picture is bullish above the current session high, bearish (on a 30/60 min cycle basis only) below.

Linda Piazza : 7/8/2005 1:45:05 PM

OEX pulling back now for a test of the 100-sma. Bulls don't want to see the OEX fall below that, or only temporarily if it does. The 100-sma is at 564.26 with the OEX at 564.53.

Linda Piazza : 7/8/2005 1:43:51 PM

RLX still holding above the 10-minute 21-ema, wit this pullback so far no more than a slight pullback. The RLX is sometimes important in OEX behavior, so that's why I watch it. Bulls (OEX and others) want to see the RLX bounce from its test of the 10-minute 21-ema at 452.15, if that occurs. The RLX is at 452.82 as I type.

Jeff Bailey : 7/8/2005 1:41:51 PM

Thinking about some GRMN on a pullback too ...

Jeff Bailey : 7/8/2005 1:40:29 PM

Garmin Ltd. (GRMN) $48.43 +1.95% Link ... thinking about taking all my "hunting/fishing hot spots" that I've stored on my GPS device and plugging them into the new Google Earth Plus Link

Jonathan Levinson : 7/8/2005 1:36:44 PM

Stepping away for 10 minutes.

Jeff Bailey : 7/8/2005 1:35:35 PM

Current OPEN MM Profiles found at this Link

Linda Piazza : 7/8/2005 1:26:30 PM

The RLX has been skipping higher along its 10-minute 21-ema as it trended higher since yesterday morning. That average is now at 451.97, with the RLX pulling slightly off its day's high. It's now at 452.97, and OEX bulls would like to see it rebound from that 21-ema again if it dips that far.

Jonathan Levinson : 7/8/2005 1:22:34 PM

This small pullback isn't the sudden stampede-reversal that bears are looking for, and it has yet to register in even the short cycle indicators. But because the 60 min cycle should be ending its upphase at these levels as well, there's the chance that we'll see a sideways "weightless" period that's so common at 60 min cycle tops and bottoms. But, in that event, the current highs should not be broken again. Confirmation will come on a break below the 72 SMA, currently up to 37.28 QQQQ. Link

Jeff Bailey : 7/8/2005 1:22:08 PM

Southwest Airlines (LUV) $13.78 +0.07% ... edges green.

Note/Update ... previously profiled bearish trade was closed out earlier this morning.

Linda Piazza : 7/8/2005 1:22:05 PM

RUT 240-minute Keltner target now 658.55, but that suggests that the RUT's climb could be approaching a short-term high, at least. The last time the RUT touched that line, on 6/17, it immediately pulled back, consolidated a while, and then fell into the 6/27 low. If it's more bullish this time, it could set up Keltner-style bullish divergence by actually piercing the channel line or even closing above it, but the RUT has adhered to this 240-minute chart's outer support and resistance on 240-minute closes since last December, the last time it was breaking above the outer channel's resistance. It can happen, obviously, but doesn't often happen, also obviously. If the RUT is going to set up Keltner-style bearish divergence, it would not quite touch it or barely do so.

Linda Piazza : 7/8/2005 1:14:15 PM

The OEX hit the bottom of May's and early June's congestion zone and now hesitates. Bulls don't want to see it pull back below the 100-sma and stay there into the close of the day. That would constitute another failed test of that average. The advdec line's approach to 3000 still worries me on behalf of the bulls among our readers. Of course, if that's the plunge protection team buying and not just everybody and his sister (smile) that would ever want to buy to be long or cover a short, I guess they can go on pumping up that advdec line.

Jeff Bailey : 7/8/2005 1:11:59 PM

01:00 Internals at this Link

Jonathan Levinson : 7/8/2005 1:04:56 PM

Session low for August crude oil, -.575 at 60.15.

Linda Piazza : 7/8/2005 1:02:26 PM

SOX target 440.21 according to its 30-minute Keltner chart, a target that will be maintained as long as the SOX prints 30-minute closes above a Keltner line currently at 435.49. The target is also possible resistance, so bulls should maintain their profit-protecting plans.

Jeff Bailey : 7/8/2005 1:01:53 PM

01:00 Market Watch found at this Link

Jim Brown : 7/8/2005 1:02:13 PM

The Dow has hit strong resistance at 10430, Naz 2100 and SPX 1210. I recommended last week to enter short positions between 1210-1215 and we have finally made the trip back to that level. The rebound off yesterday's lows has been amazing but like Marc said it is likely the biggest short covering day of the year. With everyone setting up to be short from July to October all those positions have now been erased. I am short today from ES 1214. Let's see if it works out. There is still a possibility that we will go higher but the markets would have to bust 10430/2100 to do it.

Jonathan Levinson : 7/8/2005 1:00:52 PM

The Nasdaq printed a high of 2100, SPX 1210.49, Dow 10436.

Jonathan Levinson : 7/8/2005 12:59:08 PM

The trouble with trending oscillators is that they look reading to reverse at almost every moment, a technical "wall of worry" that bulls climb. The short cycle indicators look like they've had it here, but that's been the case for an hour as the price trended higher. The 30 min cycle needs a print below the 37.20 level (72 SMA) in order to reverse. Above that, any pullback should be treated with skepticism.

Linda Piazza : 7/8/2005 12:57:19 PM

Advdec line approaching 6/07 (open) and 6/28 (close) highs. Both (6/07 open and 6/28 close) were near swing highs, so be careful, bulls. Sometimes there's further carry-through the rest of the day, but sometimes not. Sorry for all the warnings, none of which have been realized by lower prices today, but can't help myself.

Jonathan Levinson : 7/8/2005 12:51:31 PM

Volume breadth is stronger still, now 4.1:1 for advancing NYSE volume, 5.08:1 for the Nasdaq. Overall volume has picked up but is still light at 55.8M QQQQ shares so far.

Linda Piazza : 7/8/2005 12:48:57 PM

RUT moving up toward a test of the 658.50-ish target established by one Keltner chart (240-minute). Link

Jonathan Levinson : 7/8/2005 12:48:53 PM

QQQQ is printing a new session high here at 37.54, with the 30 min cycle indicators maxxed out in overbought territory and on the verge of trending, the 60 min cycle indicators reaching their tops in overbought, and the short cycles pinned to the ceiling in a trending move. The daily cycle indicators are on a fresh buy signal, and appear to be the dominant force today. 5-day 3-min view of QQQQ at this Link

Linda Piazza : 7/8/2005 12:45:35 PM

No fear of weekend events, including a hurricane. No fear of rising crude and how that might affect future earnings. I think we're getting carried away, too, and today am confused when juggling what I see on the charts and what I think I ought to be seeing. Makes me distrustful and hyper-alert to those bearish divergences and other nagging signs, but so far, those fears about the climb not being sustainable are not being realized. Maybe it's that whole wall-of-worry thing that's sending markets higher, and I certainly saw 2003's rally get started without me being fully on board, but I agree with futures writers commenting on how carried away the markets are getting. I'm not holding onto some bias because I'm hoping the markets will go a certain way because of personal options positions. Other than a RUT bear call spread that I'm beginning to worry about a little, all my index positions are safe into June opex, so this isn't personal bias and hope.

Jeff Bailey : 7/8/2005 12:44:09 PM

Swing trade entry point alert ... should be long 1/2 bullish in shares of Yahoo! Inc. (YHOO) $34.63 (unch) ... on trade at $34.60.

Jeff Bailey : 7/8/2005 12:41:03 PM

American Intl. Group (AIG) $60.09 +1.38% Link ... sets up for test of 200-day SMA ($60.99).

Relative Strength vs. DIA Link has been strengthening of late with "buy signal" in mid-May. Same for RS against the SPY Link

Linda Piazza : 7/8/2005 12:38:17 PM

The RUT is now above Wednesday's high and above the midline of its rising regression channel. Bulls want to see it hold those values, continuing to climb through its rising regression channel. One Keltner projection shows 658.40-658.50 as possible resistance, so keep a watch on your profits if bullish. On that chart, the pullbacks after hitting that resistance have been to or toward (not always quite hitting it) a Keltner line currently at 636.50.

Linda Piazza : 7/8/2005 12:34:53 PM

OEX well above its 100-sma now, and bulls want to see it hold above that into the close today. The OEX now moves into the congestion zone from May and early June, so that gains might slow.

Linda Piazza : 7/8/2005 12:32:42 PM

Still watching, but the SOX may be in the process of erasing that Keltner-style bearish divergence on the 15-minute chart. On the 30-minute one, the upper target is now 440.11, with the SOX at 437.87.

Jonathan Levinson : 7/8/2005 12:31:28 PM

QQQQ is now printing above daily R2, still above rising upper 30 and 60 min keltner resistance: Link

Linda Piazza : 7/8/2005 12:29:02 PM

The SOX is again hitting the top resistance line on the 15-minute chart, and all those worries and warning signs were for nothing. Unlike the Nasdaq, that had been showing Keltner-style bullish divergence with respect to its tests of a Keltner channel on the 30-minute chart, however, the SOX has been showing Keltner-style bearish divergences with respect to its tests of the upper channel line on the 15-minute channel. So far, that continues, but I'm watching the current test to see what happens this time.

Jeff Bailey : 7/8/2005 12:29:07 PM

iShares Russell 2000 Growth (IWO) $66.78 +1.30% ... very strong. I don't know if traders made note, but the late-afternoon profile that I made on 06/30/05, there was a sudden burst of put buying on this contract with two rather large put trades (looked institutional, not retail unless big speculator). Since that time, the IWO hasn't seen much below that $65.00 strike.

I've profiled two (2) options, but if I had five or more, I'd be cutting out, or reducing positions. Could sell July $65 Puts of equal amount too, but with volatility measures now lower, not sure it worth the effort.

Linda Piazza : 7/8/2005 12:26:53 PM

Advdec line still chugging higher.

Jonathan Levinson : 7/8/2005 12:26:20 PM

Volume breadth strengthens further, now positive 4.08:1 on the NYSE and 4.0:1 on the Nasdaq.

Jeff Bailey : 7/8/2005 12:23:40 PM

U.S. Energy (USEG) $3.72 -0.53% ... despite higher oil prices, this uranium miner has found little bullish speculation since profiled. Notes here are that SMALL bullish positions only, be willing to "sit on it" until speculation arrives. I'll stick with current MM Profiled stops, but I just want to make sure this is NOT a core holding of trader/investor.

Linda Piazza : 7/8/2005 12:20:45 PM

In my 10:59 post, I linked a 30-minute Keltner chart of the Nasdaq, showing that it was facing resistance that had held since late June, but commenting that it had been showing Keltner-style bullish divergence with each test of that black channel line. If that was to continue, I noted, the Nasdaq would begin printing some 30-minute closes above that Keltner line. It did that on the last 30-minute close, just barely, and now climbs strongly above that channel line now at 2088. If the Nasdaq maintains 30-minute closes above that channel line, it's set an upside target of 2105.32.

Jonathan Levinson : 7/8/2005 12:20:31 PM

QQQQ's still hanging above the top of the 30 min channel band, usually a move that reverses almost immediately except in the strongest of trending moves. Bears need a move below 37.25 to suggestt that this isn't occurring here. The failure to reverse from the upper keltner breach is bullish. Link

Jeff Bailey : 7/8/2005 12:17:17 PM

PETsMart (PETM) $31.00 +1.10% Link ... Testing its 200-day SMA. Disclosure: Still hold previously profiled calls in presonal account. Have established a stop now at $29.75, thinking the recent low had better be the bottom.

Linda Piazza : 7/8/2005 12:12:28 PM

The OEX is at the important 100-sma, the first time it's even touched it since 6/29. That MA is at 564.26, and a daily close above it would be the first one since 6/22. The OEX is at 564.24 as I type, still testing that average.

Jeff Bailey : 7/8/2005 12:12:04 PM

12:00 Internals found at this Link

Jonathan Levinson : 7/8/2005 12:09:04 PM

On this volume surge, QQQQ's volume has just surpassed 1/3 of yesterday's big 120.2M shares.

Jonathan Levinson : 7/8/2005 12:06:30 PM

Ten year note yields +5.2 bps at 4.083%, bonds sinking as equities rise. Gold has ticked negative from unchanged territory, while crude oil is down to a .70 gain at 61.425.

Jeff Bailey : 7/8/2005 12:03:49 PM

12:00 Market Watch found at this Link

Jeff Bailey : 7/8/2005 12:02:28 PM

Buy Program Premium

Jonathan Levinson : 7/8/2005 12:02:21 PM

Session highs across the board, QQQQ taking out Wednesday's highs and testing daily R1 at the 30 min channel top here: Link

Tab Gilles : 7/8/2005 12:01:48 PM

GOLD Index ($GOX)/ Placer Dome (PDG) Link Link

Jeff Bailey : 7/8/2005 12:02:01 PM

Bearish swing trade stop alert for the QQQQ $37.28

Linda Piazza : 7/8/2005 11:58:20 AM

The RLX looks today as if it's breaking to the upside out of the diamond shape on top of its climb off the April low. You just can't trust a good diamond any longer, can you? It has not confirmed its breakout by a move above the June high of 455.65, but since this index is sometimes important to the OEX's behavior, it should probably be watched today. Bulls don't want to see a quick reversal now that there's been a tentative break to the upside, as that would suggest a stop-running move, and they do want to see a move above that June high (not necessarily today).

Linda Piazza : 7/8/2005 11:53:36 AM

The Wilshire 5000 is at 12,040.50, having reached a HOD of 12,046.70, a few points above Wednesday's high. The Wilshire is in double-top territory, then, but not pulling back yet, or at least not more than a few points.

Jonathan Levinson : 7/8/2005 11:51:20 AM

HOUSTON, July 8 (Reuters) - Chevron Corp. (CVX.N: Quote, Profile, Research) said Friday it was evacuating all offshore workers from the central U.S. Gulf of Mexico, in addition to those being taken from the eastern Gulf, ahead of Hurricane Dennis, which has become a dangerous category 4 storm.

All Chevron workers in the central and eastern Gulf are expected to onshore by Saturday morning, spokesman Matt Carmichael said.

Link

Linda Piazza : 7/8/2005 11:50:09 AM

The RUT approaches Wednesday's 654.32 high, with the RUT at 652.60 as I type.

Linda Piazza : 7/8/2005 11:48:01 AM

OEX testing the top of the descending regression channel in which it's been trading since late June. The top of that channel is at about 564, with 30-minute Keltner resistance at 563.79 (on closes) and with the important 100-sma at 564.25.

Jeff Bailey : 7/8/2005 11:47:18 AM

StreetTracks Gold (GLD) $42.23 -0.33% ... sitting right on its WEEKLY S1.

Jeff Bailey : 7/8/2005 11:45:30 AM

Alcoa (AA) $27.07 +3.75% ....

Jonathan Levinson : 7/8/2005 11:45:11 AM

Yesterday's big put to call ratio readings are history today, with a low printed in the 2nd half-hour at .57 for the CBOE total put to call ratio. The latest reading printed .79, on the rise for the past hour. With QQV and VXO lower, my guess is that we're seeing institutional selling of puts beginning to accelerate.

Tab Gilles : 7/8/2005 11:45:00 AM

Biotech Index ($BTK) continues to rally. Link Link

Russell 2000 ($RUT) Resistance at 655. Link Link

S&P 500 ($SPX) Yesterday's canle - "Bullish Hammer"- an important reversal day. Is only so if today's follow thru candle remains up.Remaining above the 50 and 20-ema's is bullish. Can the $SPX retest it's recent high of 1220? Link

Murphy Oil (MUR) Continues to trade above $55 on a daily chart. Link Weekly chart... Link

$WTICweekly chart... Link

Jeff Bailey : 7/8/2005 11:44:50 AM

Placer Dome (PDG) $15.41 +0.85% ... largely "gold" producer, but also some copper.

Phelps Dodge (PD) $97.50 +1.24% ... holding near session highs. More of a copper producer.

Jeff Bailey : 7/8/2005 11:43:09 AM

AMEX Gold Bugs ($HUI.X) 200.33 +0.05% ... gives back early morning gains. Now sitting on WEEKLY Pivot.

Jeff Bailey : 7/8/2005 11:41:27 AM

Bullish swing trade long setup alert for 1/2 position in shares of Yahoo! Inc. (YHOO) $34.48 -0.43% ... if the stock trades $34.60. Stop goes at $33.90, targeting $36.50.

Linda Piazza : 7/8/2005 11:40:59 AM

Instead of charging straight up to the top resistance on the 15-minute chart, the SOX is now topping out on 15-minute closes on a lower Keltner line, currently at 436.25, with top resistance on that chart at 436.84. There's no real weakness here, but still just some little nagging signs that keep me watching, and this is one of those signs. So is the current price/MACD bearish divergence on that 15-minute chart. We all know that prices can continue climbing while those divergences continue, at least for a longer while than we want to hold onto bearish positions, but all this keeps catching my attention.

Jonathan Levinson : 7/8/2005 11:36:54 AM

Session highs across the board again, QQQQ still chewing away at Wednesday's highs. Volume breadth is up to a 3.36:1 advancing volume lead on the NYSE, 2.84:1 on the Nasdaq. QQQQ's short cycles are buried in overbought at this point, trending, while the 30 and 60 min channels continue to rise. The 60 min indicators are just reaching overbought territory now.

Linda Piazza : 7/8/2005 11:34:42 AM

It's still hard for me to have too much confidence in the upward movement, since it's just bringing the OEX up through the most recent consolidation pattern, to test the important 100-sma again. Today could give us some answers, but here's a chart showing the action: Link Here's how I would describe this action. The OEX had been trading within a rising regression channel off the April low. It had also been finding daily support along the 100-sma. It broke down out of that channel and below the 100-sma almost simultaneously. Since then, each test of the 100-sma has resulted in a daily close below that now-proven-important daily average. We're seeing a strong zoom higher today, but then we did also on 6/28 and 7/05. So, I'm reserving judgment. There could be a break to the upside and there could be one to the downside. That's what consolidation patterns are all about. They're a period when bulls and bears are evenly matched and have to fight it out. I do have to say that it's somewhat in the bulls' favor that the OEX has traded sideways out of that channel rather than down out of that channel, and that the longer the sideways trading goes on, the less like a "b" distribution pattern the consolidation looks, but I don't think the "b" distribution pattern interpretation is yet invalidated. The day is early yet and we may have some answers by the close, but bulls should definitely know now how they'll protect profits from now up until the test of the 100-sma, if that should occur today.

Jeff Bailey : 7/8/2005 11:32:21 AM

Tempted to sell QQQQ July $37 puts

Jeff Bailey : 7/8/2005 11:31:51 AM

NASDAQ Comp. (COMPX) 2,086 +0.50% ... intra-day action shows COMPX opening above the 2,076.85 level, and pullback found buyers right there. "Same as" QQQQ $37.00 for the most part.

Jonathan Levinson : 7/8/2005 11:20:49 AM

Ten year notes have slipped again, TNX rising to a 4.2 bp gain at 4.073%. Crude oil is up .825 at 61.55, off a session high of 61.85.

Linda Piazza : 7/8/2005 11:17:38 AM

SOX still maintaining upside targets of 436.72 on the 15-minute Keltner channel and 439.82 on the 30-minute one, but candles still show some hesitancy, too. That just makes me somewhat distrustful of the 30-minute target, anyway, although nothing else says the target should be distrusted.

Jeff Bailey : 7/8/2005 11:14:26 AM

Sirius Satellite Radio (SIRI) $6.91 +4.06% ... moves aggressively higher into 01/07-01/10 gap

Linda Piazza : 7/8/2005 11:13:26 AM

The TRAN has a potential H&S on its 30-minute chart, at the top of the climb off the late-June low. There was bearish price/MACD divergence as the head was formed. The TRAN is now at/near the appropriate right-shoulder level, and I would think that whether the TRAN is going to eventually confirm or invalidate this formation, we might expect a number of 30-minute candles to form near the current level as bulls and bears battle it out and the outcome is decided. The TRAN is at 3530.91 as I type, facing 15-miute Keltner resistance at 3532.53.

Jeff Bailey : 7/8/2005 11:11:47 AM

11:00 Internals found at this Link

Jonathan Levinson : 7/8/2005 11:09:10 AM

Volume is very light overall, despite a tall red volume candle printing here: Link . The intraday cycle setup is not yet bearish, but it's certainly growing extended on the long side, while the daily cycle is trying to put together its first steps of a new upphase. A bullish break above Wednesday's highs would the first confirmation that the bulls are winning- alternately, an intraday 30/60 min cycle pullback finishing at a higher low inside yesterday's doji tail would do it.

Jeff Bailey : 7/8/2005 11:02:39 AM

11:00 Market Watch found at this Link

Linda Piazza : 7/8/2005 11:01:44 AM

The OEX did close the last 30-minute period above the Keltner resistance line at 561.84, the first time it's done so since way back on 6/23. It faces stronger resistance at 563.62-564.00, however. There's still a need to have profit-protecting plans in place if in bullish positions.

Linda Piazza : 7/8/2005 10:59:01 AM

A view of the Nasdaq as it faces 30-minute Keltner resistance: Link The Nasdaq faces significant Keltner resistance now at the black channel line. There's the slightest hint of Keltner-style bullish divergence with each test of the upper black channel line here, however. Note that on the test in late June, prices didn't quite test the channel line, and then on July 6, they were piercing it, but then pulling back? Prices were showing more strength with regard to that channel line. If that bullish divergence is to continue, we might see some candles closing above the black channel line. If not, the Keltner-style bullish divergence is erased. Bulls should have profit-protecting plans in place in case this proven resistance does hold, however.

Linda Piazza : 7/8/2005 10:55:11 AM

SOX again at the top of the 15-minute Keltner channel that turned it back earlier today, with the top of that channel at 436.63 and the SOX at 436.19. The SOX still maintains its 30-minute upside target, now at 439.78, but it has to conquer this 15-minute resistance first. The two charts don't often conflict quite this way.

Jonathan Levinson : 7/8/2005 10:52:33 AM

Session highs across the board, volume breadth positive 3.07:1 on the NYSE and 2.77:1 on the Nasdaq. The TRIN and TRINQ are in bull territory but not extreme, .65 and .56 respectively. NDX volatility (QQV) has ticked negative, -.09 at 14.

Linda Piazza : 7/8/2005 10:49:50 AM

The OEX is currently above the 30-minute Keltner line currently at 561.82, the line that has been holding the OEX back on 30-minute closes since 6/29. We haven't seen a 30-minute close yet, so that might be important to watch. The OEX now moves up into a band of resistance from multiple causes--Keltner, MA, etc., but shows no sign of turning back yet.

Jeff Bailey : 7/8/2005 10:47:38 AM

Amex Gold Bugs ($HUI.X) 201.91 +0.84% ... on 30-minute interval chart, it has printed a "doji" last half-hour at 202.42. Just below downward trend at 204.00.

Linda Piazza : 7/8/2005 10:44:52 AM

Here's what I show on the TRAN's daily chart: a rise up to retest broken support from its rising regression channel and of various MA's. Link This doesn't look like the picture of strength from this market-important index, although the TRAN did hold up well yesterday and showed some bullish divergences with price/oscillators on the June low. It also remains above the 200-ema and the 3500 level. Watch for a breakout back above the important 100-sma at 3600.21 or else a rollover down toward 3400 as a guide for other market action.

Linda Piazza : 7/8/2005 10:44:17 AM

The SOX is climbing, but the 15-minute CCI shows a potential CCI ghost (H&S on the CCI) as it does. It doesn't really matter what warning signs we might see that there's something wrong with the SOX's climb as long as it keeps climbing, does it? Still, there is that warning, even if the warning isn't quite confirmed.

Jonathan Levinson : 7/8/2005 10:44:08 AM

QQQQ's 30 min cycle looks to have topped this morning, while the 60 min is still running higher. QQQQ bears will likely press in today's premarket high range, which sets a double top with Wednesday's high. But a break above the current 30 min cycle top at 37.29 should set them covering, and would confirm an upturn in the bottomy daily cycle.

Jeff Bailey : 7/8/2005 10:44:29 AM

Swing trade short adjust stop alert ... for Placer Dome (PDG) $15.55 +1.70% ... to $15.60. My thoughts here is that gold stock's early strength should fade if we can get further selling in the Treasury bond market.

Linda Piazza : 7/8/2005 10:35:16 AM

The SOX hasn't yet been able to retest the day's high, although it maintains upside targets at or above that level, depending on the chart interval watched. The 15-minute candles are all showing upper shadows over the last 45 minutes, with the current one also now showing a shadow, so that there's the impression of a laborious climb higher to retest the HOD.

Jeff Bailey : 7/8/2005 10:34:27 AM

QQQQ short update alert $37.16 +0.26% .... will look to cover on any further pullback to $37.00. WEEKLY Pivot would be nice at this point.

Linda Piazza : 7/8/2005 10:33:01 AM

OEX charging up to test that 30-minute Keltner line that has held it back on the last two swing highs, since 6/29. That Keltner line is now at 561.81 and it's held the OEX back on 30-minute closes since late June. Will it today? We're about to see, but be aware of further and stronger resistance near 563.50-564.00.

Jeff Bailey : 7/8/2005 10:31:41 AM

Airline Index (XAL.X) 46.11 -0.23% ....

Jeff Bailey : 7/8/2005 10:31:19 AM

Dow Transports (TRAN) 3,520.75 +0.04% ...

Jonathan Levinson : 7/8/2005 10:31:17 AM

Stepping away for 10 minutes.

Jeff Bailey : 7/8/2005 10:30:41 AM

Bearish Put close out alert .... Let's close out the four (4) Southwest Air LUV Dec. $15 Puts (LUV-XC) at the bid of $1.65.

LUV $13.60 -1.23%

Linda Piazza : 7/8/2005 10:30:35 AM

VIX dropping again. On Thursday and Friday before opex week, though, I always wonder if VIX action has something to do with opex activity, and so tend to discount it a bit.

Linda Piazza : 7/8/2005 10:29:06 AM

One thing about the RUT is that it's got a nicely defined rising regression channel in which it's moved since climbing off the April low. Right now, the midline of that channel is at about 653.33, near Wednesday's high, if I've placed the cursor correctly. From 5/18-6/23, the RUT traveled mostly in the upper half of that rising regression channel, a sign of a strongly performing entity, but from 6/23 to now, the RUT has traveled mostly in the lower half of that channel, a possible sign of a weakening entity. Therefore, the midline of that channel and Wednesday's high might be particularly important to watch if the RUT continues to rise, as might the lower boundary of that channel, now at about 640.80. I'd pay particular attention to the 240-minute 50-sma (I know, odd chart interval to watch), currently at 635.89, because the last swing low saw the RUT bounce from that average.

Jeff Bailey : 7/8/2005 10:23:04 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 7/8/2005 10:22:32 AM

So far, the SOX is looking as if it might make another stab at the day's high and 436.40 Keltner resistance on the 15-minute chart. Still not so sure about the 439-ish target on the 30-minute one, though.

Linda Piazza : 7/8/2005 10:18:48 AM

OEX back above the 200-sma, retesting the day's high, but below the 561.82 next 30-minute Keltner resistance. (Note: the OEX dropped back to the 200-sma as I typed.) This resistance is topped by 563.48, with that second resistance level near the top of a QCharts-drawn descending regression channel in which the OEX began moving on about 6/23 (and briefly violated yesterday).

Jonathan Levinson : 7/8/2005 10:18:16 AM

QQQQ bounces again from the 72 SMA, but the short cycle indicators and channel are already starting to roll over. Bulls need to take out the upper short cycle channel resistance at 37.14 to reverse it back up. Link

Linda Piazza : 7/8/2005 10:15:46 AM

The SOX still just barely maintains its breakout signal on the 30-minute chart, but that's a highly suspect signal now, because the previous 30-minute's candle produced that long upper shadow and this one is at least currently showing a doji at the breakout level. Some indecision there. It could of course be resolved one way or the other by the end of this 30-minute period, but it remains untrustworthy now.

Jeff Bailey : 7/8/2005 10:13:20 AM

10 Most Active ... QQQQ $37.03 -0.08%, SPY $120.00 +0.07%, INTC $26.85 +1.09%, JDSU $1.50 -0.66%, SEBL $8.60 -2.16%, CSCO $18.87 +0.15%, MSFT $24.73 +0.32%, GE $34.68 +1.46%, SIRI $6.79 +2.25%, ORCL $13.40 +0.82%

Jonathan Levinson : 7/8/2005 10:12:17 AM

August crude is currently +.80 at 61.525, 20 cents off the session high.

Jonathan Levinson : 7/8/2005 10:11:07 AM

Volume breadth has weakened within positive territory, advancing volume leading 1.8:1 on the NYSE and 1.16:1 on the Nasdaq.

Jeff Bailey : 7/8/2005 10:09:55 AM

Banking Upgrades ... from Sanders Morris Harris on WFC, SIVB, SBIB ... to "buy"

Jeff Bailey : 7/8/2005 10:08:59 AM

10:00 Internals found at this Link

Linda Piazza : 7/8/2005 10:06:14 AM

RLX dropping after piercing 450 and testing the top of this week's consolidation pattern. It's back near the opening level, testing that.

Linda Piazza : 7/8/2005 10:04:31 AM

Advdec line dropping now. The OEX is back below its 200-sma after having pierced it, but still above the 200-ema at 559.46.

Jonathan Levinson : 7/8/2005 10:04:01 AM

Session low for QQQQ at 37.01, coming in for a test of 72 SMA support at 36.99. The short cycle indicators are looking toppy and starting to roll over.

Jeff Bailey : 7/8/2005 10:02:38 AM

10:00 Market Watch at this Link

Linda Piazza : 7/8/2005 10:01:27 AM

SOX did pull back from the top resistance on the 15-minute chart. It pulled back far enough to put its 30-minute breakout into question, although it did end the 30-minute period above a Keltner line currently at 433.73, maintaining the breakout signal and upside target of 439.43 on this chart. As I said, though, this questions the breakout's sustainability. The signal isn't erased, but it's just a weak and perhaps-not-to-be-trusted one.

Jonathan Levinson : 7/8/2005 10:01:21 AM

Headlines:

U.S. MAY WHOLESALE SALES UP 7.3% FROM YEAR-AGO

U.S. MAY WHOLESALE INVENTORIES RISE 0.1%

U.S. MAY WHOLESALE SALES UNCHANGED AT $295.5 BILLION

Jonathan Levinson : 7/8/2005 10:00:40 AM

Wholesale inventories .1% vs. .5% exp.

Linda Piazza : 7/8/2005 9:58:59 AM

This SOX chart suggests that it may soon be time for a pullback, although the 30-minute chart suggests an eventual upside target near 439. Not sure which to trust. Note: The SOX began easing a little as I began saving and then uploading the chart, so the first bit of the pullback will show on the chart, although when I first typed those comments, the SOX was jammed against the top, purple line. Link

Jonathan Levinson : 7/8/2005 9:58:16 AM

Awaiting Wholesale Inventories in 2 minutes, est. .5%, prior .8%.

Jonathan Levinson : 7/8/2005 9:56:57 AM

The Fed has just announced a 4.75B weekend repo to replace the 10.25B expiring from yesterday for a net drain of 5.5B today.

Linda Piazza : 7/8/2005 9:52:56 AM

OEX above the 200-sma now, approaching 30-minute Keltner resistance at 561.83. Still no sign of a pullback as yet.

Jeff Bailey : 7/8/2005 9:52:11 AM

VIX.X 12.14 -2.8% ... DAILY Pivot Levels ... 11.82, 12.20, Piv= 12.91, 13.29, 14.00

Linda Piazza : 7/8/2005 9:49:41 AM

Since 6/29, the OEX has been finding resistance on each swing high on a 30-minute Keltner line currently at 561.83, on 30-minute closes, of course. A 30-minute close above that Keltner line would constitute a change in pattern, then, but there's next 30-minute resistance at 563.43.

Linda Piazza : 7/8/2005 9:45:44 AM

OEX at the 200-sma. No sign of a rollover in progress. Not yet, anyway.

Jonathan Levinson : 7/8/2005 9:44:58 AM

Advancing volume leads 2.55:1 on the NYSE and 2.46:1 on the Nasdaq, TRIN .73 and TRINQ .49. Volatility is higher, QQV +3.76% at 14.62 despite the strength in price.

Linda Piazza : 7/8/2005 9:43:52 AM

SOX continuing higher after confirming its continuation-form inverse H&S, but it's now moving into a test of Wednesday's 434.26 high, with the SOX now at 434.47. SOX bulls want to see a continued move higher, while bears want to see a downturn now in a potential double-top formation.

Linda Piazza : 7/8/2005 9:42:06 AM

The TRAN is lower this morning, but only slightly. It's above the 200-ema at 3500.15, with the TRAN at 3514.59.

Jonathan Levinson : 7/8/2005 9:41:07 AM

On the "PPT" issue, the question of whether the Working Group on Capital Markets exists or not is moot: Link . When and whether the Working Group is coordinating the bids is rarely known, and for all but the largest of traders it's irrelevant whose money it is that moves the tape.

Linda Piazza : 7/8/2005 9:40:26 AM

The OEX is at mid-channel resistance from 560.01-561.19, testing that resistance. It looks as if it may have attempted an upside breakout out of the presumed bear flag, but now faces significant Keltner, MA, and historical resistance.

Jeff Bailey : 7/8/2005 9:38:10 AM

Bearish swing trade stop alert ... for Bema Gold (BGO) at $2.29 offer.

Jonathan Levinson : 7/8/2005 9:37:26 AM

Ten year treasuries have recovered impressively from their earlier losses, TNX currently down to a 1.4 bp gain at 4.045%. Daily chart of the TNX at this Link

Linda Piazza : 7/8/2005 9:37:24 AM

OEX above the 200-ema, below the 200-sma, with that 200-sma at 560.91 and the OEX at 560.13.

Linda Piazza : 7/8/2005 9:36:40 AM

The RLX may also be confirming a continuation-form inverse H&S this morning, but the RLX's one is particularly untrustworthy. That's because yesterday, just before the close, the RLX confirmed that formation, then pulled back below the neckline again. That neckline appears to be at about 449.27, if I'm pinpointing it correctly. The RLX is at 449.79 as I type, about to face 450-452 resistance.

Linda Piazza : 7/8/2005 9:34:50 AM

The RUT gaps higher this morning, just above 650. Bulls want to see continued gains, but the RUT faces 651.18 and 653.19 Keltner resistance on the 30-minute chart, a chart that sometimes has resonance for the RUT.

Linda Piazza : 7/8/2005 9:33:33 AM

The SOX has a continuation-form inverse H&S on its 15-minute chart, with this morning's open and small climb looking like confirmation of that formation. I don't trust these formations, but they at least do show us something about bullish intentions and their ability to produce follow-through. Now SOX bulls do not want to see a quick pullback and do want to see a high above Wednesday's.

Linda Piazza : 7/8/2005 9:31:37 AM

The OEX opens inside its possible bear-flag formation.

Jonathan Levinson : 7/8/2005 9:31:04 AM

Session lows across the board. QQQQ bears need to see QQQQ south of the 72 SMA at 36.96 to stall the 30 min cycle upphase.

Jeff Bailey : 7/8/2005 9:27:54 AM

Bearish swing trade adjust stop alert .... for the QQQQ short. Raise stop to $37.28 on the remaining 1/2 short position.

QQQQ $37.08 pre-market trade here.

Linda Piazza : 7/8/2005 9:09:44 AM

Yesterday, the OEX returned to its pattern of big move within a consolidation zone/doji at the perimeter/big move/doji at the perimeter, etc. This time, it returned to that pattern in a dramatic way, though, didn't it? This doji was a long-legged one, springing up from OEX support.

That spring looks bullish on the daily chart, but bears might point to the close just below the 200-ema and -sma's, at the bottom of the recent consolidation pattern, and just cents above the 50% retracement of the decline off the Wednesday high. Bears might suggest that former support held as resistance. On intraday charts, the rise looked corrective and fit many parameters of a bear-flag rise, so there is mixed evidence. I rarely discount candles that spring up so strongly from support, but yesterday's emotion-based trading and the mixture of evidence detailed above prevents me from trusting that spring too much.

As of the first roughing-out of this report, done yesterday shortly after the close, I already thought that it was possible that today would see follow-through testing of the 200-ema and -sma's, and futures suggest that possibility, too. However, it's hard to project further than that if the OEX bounces this morning, something that's not guaranteed, no matter what futures say. If the OEX bounces past those averages, it's still only traveling through the recent consolidation pattern, until and unless it produces daily closes above that 100-sma at 564.38. The daily Keltner chart suggests that the OEX will face significant resistance (on daily closes) from 561.42-563.60.

The close at the bottom of the recent consolidation range and beneath the 200-ema and -sma's brings up the possibility of a rollover beneath one of those resistance levels, although futures don't suggest an immediate rollover. According to the OEX's daily Keltner chart, the OEX remains vulnerable to a downside target of 549.46 as long as it's producing daily closes below the Keltner levels listed in the previous paragraph, but if there's a rollover, profit-protecting plans should be in place for a test of yesterday's low, if that should be reached, and then the 549.46-552 levels.

I want to see what internals look like this morning, but I think I'd look for a rollover, perhaps beneath the 200-ema and -sma's this morning, ahead of the weekend risk and with crude rising. If there's no rollover, I think I'd stand aside. Long options plays just don't seem like good risks ahead of the weekend and while the OEX is climbing up through a recent consolidation zone. This doesn't mean that I am absolutely convinced that the OEX will plummet. It can still break out of that zone to the upside, but we just don't know yet. I'm a bit on the side that yesterday showed us some vulnerability to more downside, but that can be countered by the evidence of dip-buying seen yesterday. I'm just talking about what the charts are showing today, a Friday deep into the opex cycle.

Jonathan Levinson : 7/8/2005 8:37:29 AM

I'm not sure how to read this correctly, but it appears from this Link that the birth/death adjustment for this month's employment report was +184K. If the headline number was +146K, does that mean that the actual/unadjusted number was -38K?

Jonathan Levinson : 7/8/2005 8:34:01 AM

Ten year notes are up to a 23/64 loss at 112 17/64, TNX up 6.2 bps at 4.093%. Gold is down 1.5 to a session low of 422.70, QQQQ down to a 16 cent gain at 37.22.

Jonathan Levinson : 7/8/2005 8:31:47 AM

Headlines:

U.S. JUNE FACTORY JOBS FALL BY 24,000

U.S. JUNE SERVICES JOBS RISE BY 150,000

U.S. JUNE AUTO MANUFACTURING JOBS FALL 18,000

U.S. JUNE FACTORY DIFFUSION RATE LOWEST SINCE OCT. 03

US JUNE NONFARM PAYROLLS UP 146,000 V 194,000 EXPECTED

U.S. JUNE UNEMPLOYMENT RATE 5%, LOWEST SINCE SEPT. 01

U.S. JUNE AVERAGE HOURLY EARNINGS UP 0.2%

U.S. JUNE AVERAGE WORKWEEK UNCHANGED AT 33.7 HRS

U.S. APRIL, MAY PAYROLLS REVISED UP BY 44,000

Jonathan Levinson : 7/8/2005 8:25:49 AM

Session highs for equities, QQQQ at 37.25, low for gold and silver, August gold down 70 cents to 423.50 here.

Jonathan Levinson : 7/8/2005 8:19:14 AM

Ten year notes are hanging on the lows, -17/64 at 112 23/64. August crude is holding its gain, as are equities and even gold is up 40 cents. Other than the persistent weakness in bonds, there have been no huge spikes to suggest a "sneak-peak" trade ahead of the employment report. So far, the dollar, equities and commodities are trading strong against weak treasuries.

Jonathan Levinson : 7/8/2005 7:44:13 AM

Equities are up, ES trading 1206.25, NQ 1518.5, YM 10361 and QQQQ +.15 at 37.20. Gold is up 30 cents to 424.5, silver -.004 at 6.983, ten year notes -3/16 at 112 7/16 and crude oil is up .425 at 61.15.

We await the 8:30 releases of Nonfarm payrolls, est. 195K, the unemployment rate, est. 5.1%, hourly earnings, est. .2%, the average workweek, est. 33.8, and at 10AM, Wholesale Inventories, est. .5%. At 3PM, we get Consumer Credit, est. 4B.

Linda Piazza : 7/8/2005 7:08:27 AM

Good morning. The Nikkei closed in negative territory, hit by a worse than expected factory machinery orders number. Most other Asian markets declined, too. European markets post strong gains. Our futures are higher, up $28.00, $3.00 and $5.50 for the Dow, SPX and Nasdaq, respectively. The OECD's May leading indicator today showed the Eurozone component easing, and the U.K.'s and Japan's falling, but the U.S. component rising to 101.6 from the previous 101.5. As of 6:46 EST, gold was higher by $0.30, and crude, up $0.62 to $61.35. More detail about Asian and European markets follows in succeeding paragraphs.

Although opening in negative territory, the Nikkei soon climbed, but its climb was over once May's factory machinery orders were released. That release showed orders falling a seasonally adjusted 6.7%, far more than the expected 2.4% decline. The core number fell 2.7% year over year. In addition, May's overall household spending fell 2.0% year over year, an improvement over April's steeper decline but still worrisome to those hoping for stronger household spending. Real wage earners' household spending fell 2.0%. By the close, the Nikkei was lower by 24.15 points or 0.21%, at 11,565.99. Retailer Ito-Yokado reported an 18% rise in Q1 profit, and that company's stock had led early gainers. Seven-Eleven Japan, a unit of Ito-Yokado, reported a 9.3% gain in Q1 net income, with that income boosted by the U.S. chain's sales.

Most other Asian markets fell, too. Two sources that I use for quotes for foreign exchanges give slightly differing quotes this morning. As a result, I will not give specific levels for those Asian exchanges as I cannot easily determine which quotes are correct.

European markets climb, with a CNBC Europe commentator noting this morning that the FTSE 100 has recovered to the flat-line level from yesterday's loss. Other sources remark on some uncertainty about the gains in the face of rising crude costs, however, with bonds not retreating as expected with such strong equity gains. This morning, the Eurozone component of the OECD's leading indicator number slipped to 104.8 in May, from a revised-lower 105.0 from April. Germany's May trade surplus has narrowed, with exports rising to what one source terms its highest ever growth rate, but with import growth also surging. The thought is that export growth won't contribute much to Q2 GDP growth in Germany and that growth might fall below the growth seen in the first quarter.

Travel-related stocks, in particular, were regaining some of yesterday's losses, as were insurers. In stock-specific news, SG Securities and West LB upgraded Duetsche Boerse, adding their upgrades to Deutsche Bank's earlier in the week, and the Boerse's stock rose in early trading. The news wasn't so good from Taylor Nelson Sofres, a market research firm, with that company warning of weaker-than-anticipated performance in the U.K. and U.S. The company expects revenue growth and operating margin improvement to be weighted toward the second half. The stock sank after the announcement. Morgan Crucible Company, a specialty materials company, noted a weakening European environment but said that Asian and North American environments were still strong. After reiterating that it would meet expectations, the stock rose in early trading.

As of 6:48 EST, the FTSE 100 was higher by 61.40 points or 1.19%, at 5,219.70, just below Wednesday's 5,229.60 close. The CAC 40 was higher by 60.45 points or 1.43%, at 4,281.07. The DAX was higher by 45.70 points or 1.01%, at 4,575.88.

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