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Jeff Bailey : 8/4/2005 2:46:57 AM

Dow Transport Components sorted by 5-day Net % at this Link

Jeff Bailey : 8/4/2005 2:24:19 AM

Dow Transportation Average (TRAN) 3,802.95 -0.37% ... not much has taken place last 5 sessions. Here's my updated chart from past Market Wraps at this Link ... airliners Link were a drag today, especially DAL Link

Here's a chart of the Dow Jones U.S. Trucking Index ($DJUSTK) 277.88 -0.33%, which is up 1.91% the past 5-days and 4.65% the past 20-days. Link

Jeff Bailey : 8/4/2005 2:09:37 AM

e-mini NASDAQ (nq05u) up 1.50 points at 1,630.50.

Jeff Bailey : 8/4/2005 2:09:00 AM

e-mini S&P (es05u) up 2.00 points at 1,247.00.

Jeff Bailey : 8/4/2005 2:08:28 AM

Sept. Crude Oil (cl05u) down $0.89, or -1.43% at $61.00.

Jeff Bailey : 8/4/2005 2:03:52 AM

Wellpoint (WLP) $73.96 ... updated chart and trade comments at this Link ... what to do, or not to do. WLP is getting very close to my initial bullish target for the Sep. $72.50 Calls.

As a trader that did take a 95% profit on 2/3 of this position, it is "easier" to simply say... let's roll the dice and see if we can't get something higher at $79.22, maybe $83.86-$85.72 by Sept. expiration.

Earlier today (Wednesday) I encouraged traders to have AT LEAST TAKEN A PROFIT on part of their position. When you do that, it is a bit "easier" to then not be overly concerned with a possible broker downgrade of the stock, a geopolitical event, which could have a Sep. $72.50 Call becoming a "no bid" by expiration.

About a week ago, a Market Monitor trader wrote me an e-mail discussing some of his past option trades, and like any option trader that has been around the block a time or two, sold an entire position only to see those options turn into massive winners that could never have been imagined.

For me, it is a joy to be long a stock that has a nice bullish vertical count and is hitting 52-week highs, where sellers aren't sure where resistance is at.

For the Market Monitor Profiles I'm going to challenge WLP as we near my initial bullish target, and will RAISE BULLISH STOP to sell the remaining options should the stock trade below Wednesday's low of $73.30.

The way I look at it, even those that decide to hold on and "roll the dice," can't get hurt too bad, IF THEY'VE TAKEN A PROFIT on some of their position.

Jeff Bailey : 8/4/2005 1:20:13 AM

Pivot Matrix for Thursday at this Link

Jeff Bailey : 8/4/2005 12:56:45 AM

Current OPEN MM Profiles found at this Link ... Today's Activity ... Stopped out of the remaining 1/2 bullish position in shares of Hanover Compressor (HC) at $14.25 ($-0.28, or -1.93%).

Swing trade stopped on the 1/2 bullish position in Cisco Systems (CSCO) at $19.42 ($+0.41, or +2.16%) Still long 1/4 bullish from 07/28/05 entry at $19.23.

Jeff Bailey : 8/4/2005 12:30:31 AM

Bonso Electronics (BNSO) continued from 09:34:44 ... as I was saying (somehow I erased my reply and it never posted) is that it may not be uncommon to find yourself "filled" on an order after the regular session (04:00 PM EDT) in a thinly traded stock. I don't know if the trader had placed at good till cancel order + extended session or not, but even if the trader's order was marked "regular session only," it is possible that a market maker could have put together your order, while only 300 shares, and then wanted your business (in the form of an order execution) and marked your order as filled at your stated limit price.

Now... I will confess that Tuesday's trade was a little "slow" so I was messing around with BNSO and I had placed a GTC order at $5.86, but just as I did, another trader/market maker moved in front of me, almost as if they were trying to make me "pay up" at the then offer of $6.00.

What I'll sometimes do, and I've mentioned this to traders in the past, is to cancel my order and wait for awhile. Sometimes it is best to just "pay up" if you're really wanting to get a fill, but trade was slow, and sometimes a trader can get a feel for a stock when you mess around a bit.

Long story short .... as time passed, BNSO eventually traded $5.85, THEN I re-entered my order to buy 300 shares at $5.86, thinking that I finally had found a seller at my stated price. Yes, I was eventually filled on 300 shares at 03:52:00 PM EDT.

Now, I did profile a day trade long back on 07/11/05 for BNSO, when the company had reported quarterly earnings. That day we saw a "burst in volume" relative to what this stock normally trades on a daily basis.

Note that BNSO is not in my Current OPEN MM Profiles. The reason for this is that this stock trades way too thin for such a public forum.

I may not be the sharpest knife in the drawer, but I do know that many traders will do whatever it takes if they think they can make a buck or two. I can almost guarantee traders that if I profile a trade on BNSO when volumes are as light as they are in this stock, then a "contrarian" will most likely watch volume and up-ticks, try and get a feel for what he/she has to do in order to then try and manipulate the stock lower (in the case of a bullish profile) to then trigger our stops, which he/she would then cover into.

So... I mention stocks like BNSO and BOO as stocks I see as bullish and under accumulation. And while I hold bullish positions in BNSO and BOO, I'm not telling you where my stops are.

These stocks are not what I would consider to be "core holdings" either. They are small positions where I can afford to take some days of -10% and not "panic" since the position is smaller. I've had some trade history with BNSO as far back as when the stock traded under the symbol of BNSOF. When it get "hot" you can't get enough, and when it gets "cold" and you've got a big position, then you've got too much.

OI Technical Staff : 8/3/2005 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.

Linda Piazza : 8/3/2005 9:52:00 PM

As I thought might happen after yesterday's doji at 12,000, amid possible political turmoil, the Nikkei gapped lower and is headed down during the morning session. As I type, it's lower by 142.88 points or 1.19%, erasing most of the gains made over the previous four days. The Nikkei sometimes jumps all over the place and trades differently during the afternoon session than it did during the morning session, but it's so far trading in a far from bullish pattern over the short term. Our futures so far show a modest reaction. Our futures don't tend to react as much to moves in the Nikkei as they once did, but tend to be more reactive to European developments.

Jeff Bailey : 8/3/2005 9:34:44 PM

Bonso Electronics (BNSO) $6.00 +2.04% ... Trader Question Yesterday, I placed an limit order to purchase 300 BNSO at your $5.86 recommendation. I was surprised to find that it had filled 8 minutes after the close. Have you had this experience with thinly traded stocks?

I assume you were filled also, and I will be watching for your comments in the market monitor.

Tab Gilles : 8/3/2005 5:12:22 PM

Nasdaq Summation Index ($NASI) Bull mode, no reversal yet. Link Link

Nasdaq 100 ($NDX) Link Link

Profunds UOPIX/USPIX. Link

Jeff Bailey : 8/3/2005 4:56:54 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 8/3/2005 4:39:45 PM

Closing Internals found at this Link

Jeff Bailey : 8/3/2005 4:33:20 PM

Sina.com (SINA) $28.99 +3.83% Link ... lower at $26.80 on headline numbers of $0.17 per share vs. $0.31.

Jeff Bailey : 8/3/2005 4:30:03 PM

Algoma Steel (AGA.T) Link ... reports Q2 EPS of C$1.60 vs. C$1.93 in the same period a year ago. Sales came in at $C494.6 million vs. C$439.8 million. Company saying it will not pursue sale, declares special dividend of C$6.00 per share.

Lowering Q3 quidance, citing lower steel prices.

Tab Gilles : 8/3/2005 4:28:27 PM

Nasdaq100 ($NDX) Link Link

Will follow up later on $NASI/$NDX/UOPIX charts (referenced to 7/29 12:34PM post).

Tab Gilles : 8/3/2005 4:18:01 PM

Positive article in Barron's this week lifted MSFT shares today to a new 52 week closing high. Link Link

Linda Piazza : 8/3/2005 4:08:50 PM

Wilshire 5000 produced a doji today, at the top of a steep climb. The Wilshire 5000 doesn't always honor these with a reversal.

Linda Piazza : 8/3/2005 4:07:54 PM

The RLX closed below its 10-sma for the first time since 7/01, although it was only a minimal close below that level. The RLX remains safely within a rising regression channel off the late April low, although it's breaking down out of that too-steep-to-be-sustained one from late-June low. There's a hint of a H&S on top of the RLX's 60-minute chart, but it hasn't been confirmed yet.

Linda Piazza : 8/3/2005 4:05:28 PM

Inside day or harami for the SOX today.

Tab Gilles : 8/3/2005 4:02:59 PM

Seat just sold for record $3M on NYSE.

Linda Piazza : 8/3/2005 3:59:43 PM

Another day. For the OEX, that means another day in the 15-minute Keltner channel currently spanning from 574.60 on the downside to 577.98 on the upside, but it may close at or only slightly below the HOD.

Jeff Bailey : 8/3/2005 3:55:57 PM

Maybe those overly short bears are eager for the secondary? HC $14.71 +0.89% .... if there is any "good news" when a company dilutes shareholder equity with a secondary, it is when the company is losing money.

Linda Piazza : 8/3/2005 3:46:52 PM

The SOX has been testing a Keltner line currently at 483.14, with that line prompting a bounce this morning. A 15-minute close beneath that line would suggest a trip down to 480.17 or so, but of course that would be a 15-minute close below it in the last such period of the day, and those are not always trustworthy as to setting targets. Without such a fall into the close, that continuation-form inverse H&S remains a possibility.

Jeff Bailey : 8/3/2005 3:46:29 PM

Host America (CAFE) alert $14.25 ... when stock was halted for trade on 07/22/05, press releases mentioned that SEC halt may last until 08/04/05. Tomorrow is 08/04/05 for those that may hold bullish/bearish positions.

Disclosure ... I currently hold 200 long of the CAFEW.

Jeff Bailey : 8/3/2005 3:43:42 PM

SPY $124.58 +0.15% ...

Jonathan Levinson : 8/3/2005 3:43:32 PM

QQQQ clears 72 SMA resistance at 40.03: Link

Jeff Bailey : 8/3/2005 3:43:19 PM

BIX.X 362.12 -0.22% ...

Jeff Bailey : 8/3/2005 3:43:00 PM

VIX.X 11.87 +1.02% ...

Jeff Bailey : 8/3/2005 3:42:41 PM

TRIN ... 0.97 +4.3% ...

Linda Piazza : 8/3/2005 3:37:08 PM

The OEX is narrowing its trading range even more the last couple of days, staying within the upper portion of the Keltner channel that's contained most of its movements for several weeks. When I look at a daily chart, though, there doesn't seem to be a lot to make out of that unless the OEX stays there all the time that the daily RSI cycles down to oversold levels and starts up again. That would be bullish. Hasn't cycled down there yet, though.

Jonathan Levinson : 8/3/2005 3:35:51 PM

The short cycles have drifted into a buy signal, but price is holding at QQQQ 40.00 and volume has dropped off to its lowest levels of the day: Link . The 30 min and 60 min cycles are chopped up, awaiting a decisive price move below 39.85 or above 40.20.

Linda Piazza : 8/3/2005 3:29:34 PM

For those who might have missed my early morning Asia/Europe report, the Nikkei tested 12,000 last night, but fell back and closed slightly below the open, producing a doji at that 12,000 resistance. This comes amid a showdown with the prime minister and the houses of the government over a postal privatization bill. Koizumi is saying that if it's not approved, he will dissolve the lower house and consider it a call for resignation. He's driving for the vote to be held Friday, but there's chatter that it may be postponed until after the weekend. There's the possibility for a reveral signal to be confirmed tonight, then, but as I cautioned this week, the Nikkei has produced one reversal signal after another on its way higher, without ever reversing, so that should be taken with some skepticism until there's follow-through to the downside and then a failed retest.

Jonathan Levinson : 8/3/2005 3:25:06 PM

The short cycles are curling up in oversold territory, and a move above the 40.03 level should be enough to print the buy signal. If the bears are going to make a stand, this would be a good spot for it: Link

Jeff Bailey : 8/3/2005 3:23:47 PM

Who dat buying 1 of the KOKI for $1.40? Coca Kola (KO) $44.67 +0.88% ... I'm thinking a "retail short" of 100 shares that isn't sure the old highs will hold.

Linda Piazza : 8/3/2005 3:21:35 PM

RUT retesting the 15-minute 100/130-ema's again, and trying to bounce from them again, as it did this morning. They're at 683.08 and 682.08, respectively, with the RUT at 683.77.

Jeff Bailey : 8/3/2005 3:20:25 PM

Hmmmm... Sturm Ruger (RGR) $10.21 -0.09% ... session low has been $10.01.

Linda Piazza : 8/3/2005 3:17:27 PM

Jeff just noted the BIX's level, and I wanted to follow up by reminding readers of that 200-ema at 360.92, with that -ema prompting bounces for the last couple of months. The June swing low bounced from that average after touching it two days in a row. At July's swing low, the BIX was testing that average, piercing it on the 7th, dropping exactly to the bottom of its broadening formation, and then bouncing up to close at that average. And, for the previous three days, the BIX's candles have been forming along the top of that line. A close beneath it would suggest that the most recent consolidation pattern has been a "b" distribution pattern and that the BIX could fall further through that broadening formation again. A bounce above the most recent formation could suggest a trip up to retest the 200-sma.

Jonathan Levinson : 8/3/2005 3:15:52 PM

Ten year note yields finished -3.6 at 4.3%.

Jonathan Levinson : 8/3/2005 3:15:24 PM

Crude oil has reopened, printing a new low at 60.70.

Jonathan Levinson : 8/3/2005 3:14:47 PM

QQQQ breaks the previous high at 40.00 and charges to the 72 SMA at 40.03: Link

Jeff Bailey : 8/3/2005 3:14:31 PM

Cisco Systems (CSCO) $19.50 +0.05% ... back in the green.

Jeff Bailey : 8/3/2005 3:12:09 PM

BIX.X 361.61 -0.36% ...

Jeff Bailey : 8/3/2005 3:11:43 PM

VIX.X 11.95 +1.70% ...

Jeff Bailey : 8/3/2005 3:11:08 PM

TRIN 1.02 +9.67% ...

Jeff Bailey : 8/3/2005 3:10:06 PM

Little buy program just after SPY $124.37 kissed its DAILY Pivot.

Jeff Bailey : 8/3/2005 3:09:36 PM

03:00 Internals found at this Link

Linda Piazza : 8/3/2005 3:07:06 PM

The Wilshire 5000's previous LOD was 12,430.70. Now at 12,434.49.

Linda Piazza : 8/3/2005 3:05:40 PM

The OEX drifts down toward mid-channel Keltner support, with that at 575.48 on a 15-minute close. The bottom of the channel has now risen to 574.55. Some of those in rollover plays will want to exit automatically, at least part of their positions, if that level should be hit. Depending on how the OEX reacts as it drops--if it does--some aggressive traders might want to keep a partial position in case there's a downside breakdown this time.

Jeff Bailey : 8/3/2005 3:03:07 PM

03:00 Market Watch at this Link

Jonathan Levinson : 8/3/2005 3:02:21 PM

Volume has picked up a little but remains light. QQQQ is selling with no urgency whatsoever, the TRINQ edging lower to .42 as price bounces off a 39.94 low. The 39.88 low remains untested. Link

Jeff Bailey : 8/3/2005 2:58:15 PM

Dow Diamonds (DIA) $106.70 (unch) ... yepper ... DAILY Pivot $106.69

Jeff Bailey : 8/3/2005 2:56:38 PM

VXN.X 14.04 +0.64% ... QCharts' DAILY Pivot 14.02.

Jeff Bailey : 8/3/2005 2:55:08 PM

QQQQ $39.95 -0.32% ... not a bank in the bunch, and DAILY Pivot.

Jeff Bailey : 8/3/2005 2:54:29 PM

BIX.X 361.65 -0.25% ... trying to hold its DAILY S1.

Linda Piazza : 8/3/2005 2:53:20 PM

SOX still tsting the appropriate right-shoulder level for the inverse H&S. Bears want a drop to a new LOD and bulls want it to round up to a new HOD.

Jeff Bailey : 8/3/2005 2:52:16 PM

Current OPEN MM Profiles found at this Link

Jonathan Levinson : 8/3/2005 2:50:39 PM

Volume breadth -1.32:1 on the NYSE, -1.26:1 on the Nasdaq.

Linda Piazza : 8/3/2005 2:44:49 PM

RLX also testing the LOD.

Jeff Bailey : 8/3/2005 2:43:11 PM

TRIN 1.02 ... after "pop" to 1.13 (DAILY R1 is 1.14)

Jeff Bailey : 8/3/2005 2:42:32 PM

Bullish swing trade stop alert on the 1/2 bullish in Cisco Systems (CSCO) $19.42 -0.30%.

Linda Piazza : 8/3/2005 2:41:58 PM

TRAN testing the LOD.

Jonathan Levinson : 8/3/2005 2:39:39 PM

Sept. crude oil finished -.975 at 60.925, off a low of 60.85. 50-tick chart: Link

Linda Piazza : 8/3/2005 2:45:51 PM

OEX still staying in the upper half of the Keltner channel that's been containing prices. Those hoping for a rollover through the channel want a sound break below mid-channel support, now being tested, but that's layered down to 575.46. Lower channel support at 574.57, and bears should know how they'll handle that test, if it should occur, before the OEX hits that level. Trying to bounce now, though.

Linda Piazza : 8/3/2005 2:36:21 PM

SOX pausing at the appropriate right-shoulder area for its inverse H&S, but the battle isn't over yet.

Jeff Bailey : 8/3/2005 2:32:52 PM

Bullish swing trade raise stop alert ... let's raise a stop on the 1/2 position, or those shares bought on 07/26/05 of Cisco Systems (CSCO) $19.46 -0.15% ... to $19.42.

Leave the other 1/4 with stop at $18.80.

Linda Piazza : 8/3/2005 2:30:34 PM

SOX dropping heavily straight down to that right-shoulder area. Bears want it to keep dropping, to a new LOD and invalidate that formation. Bulls want it to steady now, near 483.25 and climb up to a new HOD.

Jonathan Levinson : 8/3/2005 2:29:59 PM

Session low for GE at 34.17, breaking the prior lows: Link

Jeff Bailey : 8/3/2005 2:28:55 PM

BIX.X 361.89 -0.28% ...

Jeff Bailey : 8/3/2005 2:28:37 PM

VIX.X 11.83 +0.68% ... back at DAILY Pivot.

Jonathan Levinson : 8/3/2005 2:28:09 PM

Session low for Sept. crude oil at 60.925, 2 minutes to go until the session close.

Jeff Bailey : 8/3/2005 2:27:38 PM

TRIN 1.11 +19.35% ... session high.

Jonathan Levinson : 8/3/2005 2:27:15 PM

The extreme TRINQ reading at .35 appears to have delivered all of an 8 cent drop to 40.01, with the TRINQ now up to .45, no longer extreme but still below neutral-bullish territory. That useless short cycle downphase is starting to kick in, and volume breadth is down to -1.17:1. The current low at 39.88 is just below the daily pivot, and will be the level to confirm any weakness affecting the 30 and 60 min channels. Currently, 60 min channel support is at 39.86.

Jeff Bailey : 8/3/2005 2:24:20 PM

Google (GOOG) $298.375 -0.29% ... when stock was trading $299.05 there was a "bad tick" to $295.00. I thought "key punch" error at the time, but stock has been slipping since.

WEEKLY R1 298.26 right in here.

Jeff Bailey : 8/3/2005 2:21:56 PM

NASDAQ Composite (COMPX) 2,219.04 +0.03% ... will make notes here that QCharts' WEEKLY Pivot Levels are ... 2,149 , 2,167 , Piv= 2,184, 2,202 , 2,220.

At this point of the session yesterday NH/NL were 182:15

Will also note that last week's WEEKLY R2 was 2,221, and COMPX traded as high as its WEEKLY R1 (2,200)

Jonathan Levinson : 8/3/2005 2:17:56 PM

Session low for GE just printed here at 34.22, with the Dow down 3 at 10680 while QQQQ holds at unchanged, just below the highs of the day.

Linda Piazza : 8/3/2005 2:17:47 PM

SOX pulling back slightly from yesterday's and today's HOD's, but not muc yet. Remember the potential continuation-form inverse H&S scenario on that chart, with a right shoulder yet to be formed. The appropriate right-shoulder area would likely be near the 483.25 level. Although these continuation-form inverse H&S's are perhaps not as trustworthy as others, bears on any index sharing components with or related to the SOX certainly don't want to see the SOX burst up through that neckline, at about the high of the day.

Jeff Bailey : 8/3/2005 2:09:52 PM

02:00 Internals found at this Link

Jonathan Levinson : 8/3/2005 2:08:29 PM

VXO down to 10.90, VXN 13.76. The TRIN remains neutral at .97, but TRINQ is notably lower at .35, which is an extreme reading. It's either in or near blowoff territory, or it's signalling the start of the trending move in the daily and weekly timeframes discussed earlier. More likely some kind of buying climax, but the price (and volume) will tell us.

Tab Gilles : 8/3/2005 2:06:12 PM

Biotech Index ($BTK) Link Link

Linda Piazza : 8/3/2005 2:03:13 PM

The top of the OEX's 15-minute Keltner channel has now risen to 577.74. I said I wasn't going to look too hard at that potential continuation-form inverse H&S, and I'm not, because it's forming in the midst of a consolidation zone, but it's still there. Remember that a neckline test or a minimal confirmation of such formations is often one of the two most likely points at which prices quickly reverse and end up invalidating the formation. That's happening more often lately with bearish than bullish formations, but still the possibility exists because of the way the OEX has been acting each time it breaks minimally above that upper Keltner line for the channel that's been mostly containing it.

Jeff Bailey : 8/3/2005 2:02:15 PM

02:00 Market Watch found at this Link

Jeff Bailey : 8/3/2005 1:55:20 PM

CBOE Internet Index (INX.X) 203.59 -0.12% ... still pinned under what I believe to be a "neckline" of a reverse head/shoulder pattern. (see yesterday's MM postings)

Jonathan Levinson : 8/3/2005 1:53:36 PM

QQQQ is back to the highs, the short cycle sell signal so far doing nothing for the past half hour. Volume breadth has flipped positive on both exchanges, +1.02:1 on the NYSE, +1.21:1 on the Nasdaq. Note that QQQQ volume is running well below yesterday's 79.7M share total, with just 44.1M shares traded approaching 2PM.

Jeff Bailey : 8/3/2005 1:52:49 PM

Google (GOOG) 299.55 +0.11% ... bids green. I hear dinner bells in the distance.

Linda Piazza : 8/3/2005 1:52:26 PM

Isn't it odd that a crude drop to $61.50 would help prop up the markets this afternoon, although I'm certainly not saying that it's the only factor at play? The thought of that number would have cratered the markets a while ago.

Jeff Bailey : 8/3/2005 1:51:26 PM

VIX.X 11.70 -0.42% ... session low has been DAILY S1

Jeff Bailey : 8/3/2005 1:50:40 PM

Dow Diamonds (DIA) $106.81 +0.09% ...

Jeff Bailey : 8/3/2005 1:50:07 PM

Who dat buying 10 of those KOKI? ... Coca Cola (KO) $44.64 +0.81% ... breaks to post-earnings high.

Jeff Bailey : 8/3/2005 1:47:31 PM

I almost forgot! ... "X" gets the square Link

Linda Piazza : 8/3/2005 1:45:29 PM

The RUT is so far having a slight difficulty staying above a 50% retracement of the day's range, with that midpoint at about 685.47 and the RUT now at 684.98.

Jonathan Levinson : 8/3/2005 1:44:21 PM

Crude oil up off its 61.025 low to a .325 loss at 61.575. Sept. gold is up 5 at 439.70, clearing 439 resistance, while ten year note yields are back above 4.3%, currently down 3.4 bps at 4.302%.

Jeff Bailey : 8/3/2005 1:43:47 PM

Newmont Mining (NEM) $39.98 +4.85% Link ... right back at that $40.00, which has been a major point of contention. 04/26-04/27 gap lower.

As of 06/15/05 short interest report from NASDAQ was 13.2 million, with days to cover at 2.57. Was down slightly from 05/13 short interest of 13.8 million and DTC of 2.66.

Jeff Bailey : 8/3/2005 1:35:23 PM

AMEX Gold Bugs ($HUI.X) 210.14 +5.33% ... good gravy!

Linda Piazza : 8/3/2005 1:32:39 PM

The SOX's former potential H&S with a descending neckline (15-minute chart) now is beginning to look a lot like a potential continuation-form inverse H&S with a right-shoulder still to be formed. If so, the SOX might soon find resistance near yesterday's high, and turn down into the right shoulder, at about 483.25. SOX at 486.12 as I type. Yesterday's high at 486.34. Fifteen-minute Keltner resistance at 485.83 on 15-minute closes, with next resistance above that at 487.10, the site of the ascending trendline off the highs beginning yesterday morning.

Jeff Bailey : 8/3/2005 1:32:28 PM

Bullish swing trade raise stopt alert ... With WellPoint (WLP) $74.22 +1.15% ... let's raise a stop to $2.10 on the WLP Sep. $72.50 Call (WLP-IV) currently bid/ask $3.30 x $3.50.

I would strongly suggest any trader yet to take a profit in these calls from 07/28 profile, take some profits! At some point, I would expect a broker downgrade based on some type of "valuation" call.

Linda Piazza : 8/3/2005 1:28:14 PM

OEX just drifting around within that channel. If I look hard, I can see a possible continuation-form inverse H&S, but I'm not going to look too hard as the OEX is just rattling around so far today. And a lot of days.

Jonathan Levinson : 8/3/2005 1:28:05 PM

Volume breadth is still even, -1.04:1 on the NYSE and -1.07:1 on the Nasdaq. Yesterday, the price spent all afternoon and part of the morning at current levels, as the 30 and 60 min cycles rose and topped. This morning's 15 cent gap down open was enough to bottom the 30 min cycle, while the 60 min cycle is in a sideways downphase. This is a recipe for more chop until the cycles line up together on either side. Meanwhile, the daily cycle is trending in overbought and the weekly cycle is maxxed out in overbought and on a bearish kiss. It's either an extremely bullish trending move, or the formation of a top in the longer timeframes. A close above QQQQ 40.63 (current 20-day bollinger resistance) would suggest the former, while 2 days' worth of lower lows and lower highs would suggest the latter- that, or a close below 39.50-.55. Note that 20-week bollinger resistance is at 40.24.

Linda Piazza : 8/3/2005 1:24:11 PM

MXIM and TXN, with 8.25 and 6.26% weightings in the SOX, have both hit higher highs today and neither has yet retreated far. KLAC, MRVL, and LLTC, other heavyweights in the index, are showing mixed behaviors today. BRCM is higher than yesterday, but not a new recent high and approaching an area from which it got slapped back earlier in the month. A mixture of behaviors, but I would think that it would be hard for the SOX to retreat too far as long as MXIM and TXN were surging.

Mark Davis : 8/3/2005 1:24:07 PM

Jeff, no offense taken, of course. I tend to trade on a shorter timeframe anyway, so we could both be right. I won't be short Google for long, that's for sure.

Jeff Bailey : 8/3/2005 1:24:14 PM

Disclosure : I take no offense when a fellow trader/analyst profiles a trade that is opposite of my convictions/analysis. I hope Mark Davis knows that I was only keeping with this morning's "eat my hat" theme.

I can see Mark's bearish thoughts/observations as it relates to my GOOG chart posted at 12:41:25.

However .... yesterday I showed a WEEKLY Distribution of Dorsey/Wright's BPINET and GOOG has moved to the right, now in the 20-40 area. The DAILY Distribution had GOOG moving to the right into the 0-20 area.

Jeff Bailey : 8/3/2005 1:17:19 PM

SPY $124.53 +0.11% ... came within a penny of its DAILY R1.

BIX.X 362.29 -0.17% ... sessiion high (12:35-12:40) came at 362.44, just shy of its DAILY Pivot.

For a third-straight session we see TRIN and VIX.X moving counter each other. I sense great pressure starting to build.

Jeff Bailey : 8/3/2005 1:14:33 PM

01:05 Internals found at this Link ... I'm running about 5-minutes behind this morning.

Linda Piazza : 8/3/2005 1:13:38 PM

TRAN still testing (or again testing) that 3804-3806-ish S/R zone, at 3804.30 as I type. Next 15-minute Kletner support near 3800.75 and then down to 3792.43 on a 15-minute basis.

Jonathan Levinson : 8/3/2005 1:09:39 PM

So far, this isn't the type of Pamplona-run reversal that 60 min cycle bears want to see on QQQQ, with a slow drift off the high following the test of daily R1. But the short cycle indicators are on the verge of a new sell signal, and a break below the 72 SMA 39.97 is just 10 cents away. Link

Linda Piazza : 8/3/2005 1:08:48 PM

The OEX is turning down through its 15-minute Keltner channel, the one that's contained its movements for so long, now spanning from 574.30 on the downside to 577.73 on the upside. This time, those hoping for a trip down to the lower boundary want to see the OEX get past mid-channel support, at 575.32, but with more support being tested currently and then near 576.

Jeff Bailey : 8/3/2005 1:07:09 PM

01:05 Market Watch found at this Link

Mark Davis : 8/3/2005 1:01:15 PM

Jeff, we have Google bracketed.

Linda Piazza : 8/3/2005 1:05:46 PM

So far, the OEX is not breaking above the top of the Keltner channel that's contained it for several weeks, with the top of that channel now at 577.72, much less closing a 15-minute period above it. It did, however, reach a high a dime above yesterday's. OEX at 576.96 as I type. Bears want support at 576.78 to give way on 15-minute closes. This behavior is why I didn't think trading the OEX at all a particularly good idea today, although bears hoping for a rollover through that channel haven't lost all hope just yet. I thought today might be one of those days when the OEX might rattle around even more erratically than it has been.

Tab Gilles : 8/3/2005 12:58:17 PM

ISHARES LEHMAN 20 YR (TLT) Link

Jonathan Levinson : 8/3/2005 12:56:21 PM

LOL!

Jeff Bailey : 8/3/2005 12:56:01 PM

Laughing at this morning's Futures Monitor postings.

Well... I've got to take Drake out to take care of some business. Will save a treat for Mark Davis and his GOOG puts. (grin)

Linda Piazza : 8/3/2005 12:54:47 PM

RLX rising to test the 50% retracement of its rally from the 7/27 low into the new high of 489.34 on 7/29. That midpoint is at about 484.50 with the RLX sinking back just a little as I typed, and now at 483.63. Bears want that 50% level to hold and for the RLX to finally drop below 479. It's also retesting the 15-minute 100/130-ema's from the underside.

Linda Piazza : 8/3/2005 12:49:37 PM

The Wilshire 5000 punched to a slightly higher high, above yesterday's 12,471.50 high, with the DWC HOD at 12,478.26 so far. Daily Keltner resistance at 12,486.73 on daily closes, with that mostly containing the Wilshire 5000 on those closes, and with next resistance at 12,558.78 if that's soundly breached on a daily closed. A daily close below 12,377.93 erases the higher of those two targets, though. DWC at 12,471.46 as I type.

Jeff Bailey : 8/3/2005 12:47:16 PM

Cisco Systems (CSCO) $19.58 +0.46% Link ... highs of session. Looks to make a higher low for a fifth-straight session. 08/01/05 "Doji" close looking pivotal.

Linda Piazza : 8/3/2005 12:43:24 PM

The BIX still chops higher, not quite at the 15-minute 100/130-ema's yet. Theyr'e at 361.80 and 363.17, respectively. The 200-ema has been such strong S/R over the last couple of months that this bounce attempt could be expected again. The BIX is consolidating above that average in what could be a "b" distribution pattern or maybe an attempt to consolidate before a stronger bounce. The direction fo the breakout will tell us, but if the breakout is above yesterday's high, to the upside, the BIX is going to butt right up against the 200-sma a few points higher, with that average at 364.51.

Jonathan Levinson : 8/3/2005 12:42:59 PM

There was a big volume surge on the move to the highs, but I can't tell if what I'm seeing is the result of the IB snafu or genuine market action. If it was the latter, then there's a chance that we've just seen the terminal blowoff to complete the 60 min cycle upphase. If so, then the price shouldn't hang around up here for long- a break back below 39.97 should confirm it. Link

Jeff Bailey : 8/3/2005 12:41:25 PM

Google (GOOG) $298.50 -0.23% ... now with both a bull (blue) and bear (red) 38.2% fitted retracement at this Link

Linda Piazza : 8/3/2005 12:40:28 PM

The TRAN did not punch to a new high, at least not yet.

Linda Piazza : 8/3/2005 12:39:48 PM

The SPX has soundly rejected its potential H&S, akin to the one that the OEX had been building, punching to a slightly higher high than the 7/28 high of 1245.15. It's at 1245.12 as I type. Still basically within that consolidation pattern at the top of the recent climb.

Jonathan Levinson : 8/3/2005 12:35:39 PM

Session highs across the board, QQQQ testing yesterday's highs following this morning's higher low.

Linda Piazza : 8/3/2005 12:35:25 PM

SOX testing the top of this morning's gap lower.

Linda Piazza : 8/3/2005 12:34:32 PM

OEX testing Keltner resistance at 577.32 on the 15-minute chart, next resistance at 577.65, and currently shows a hint of Keltner-style bearish divergence that will be erased if the OEX strongly pierces the upper of those two lines.

Linda Piazza : 8/3/2005 12:33:12 PM

The RUT has risen to retest a best-fit rising trendline off the lows since Friday, with the RUT having broken below that trendline this morning. Trendline at about 686.08, with the RUT currently at 685.80.

Linda Piazza : 8/3/2005 12:31:53 PM

SOX-drive MXIM to a new high.

Jeff Bailey : 8/3/2005 12:31:13 PM

Google Inc. (GOOG) $298.44 -0.25% ... here's a "clean" chart with a bear fit 38.2% retracement at this Link ... I will add a bull fit 38.2% in a minute. See what we get and if it makes any sense.

Linda Piazza : 8/3/2005 12:30:47 PM

SOX testing 15-minute Keltner resistance at 485.19 on 15-minute closes, with the SOX at 485.61 as I type. Next 15-minute Keltner resistance at 486.37, near the top of an ascending trendline off the highs since early yesterday morning. There's some hint of Keltner-style bearish divergence on that 15-minute chart, so if that's to continue, the SOX might even find resistance at this Keltner line or would just touch or pierce it, but not close much above it. If the move is stronger, that bearish divergence is undone.

Jonathan Levinson : 8/3/2005 12:30:34 PM

Ten year note yields hold below 4.3%, -4.1 bps at 4.295%. Crude oil is printing a session low at 61.125, -.775, while Sept. gold prints a high at 439.60.

Jonathan Levinson : 8/3/2005 12:29:45 PM

Volume breadth is now lightly positive, +1.07:1 on the NYSE and +1.16:1 on the Nasdaq.

Jonathan Levinson : 8/3/2005 12:28:07 PM

IB is finally back online, QQQQ testing 40.11 here at the high. Cecause of the IB outage, I've lost all the data of the past half hour, and so have a single candle to reflect the move. Link

Linda Piazza : 8/3/2005 12:26:59 PM

SOX now rising to test the day's high of 484.99, just rising above it as I type.

Jeff Bailey : 8/3/2005 12:26:14 PM

S&P Depository Receipts (SPY) $124.68 +0.23% ... new 52-weeker alert.

Linda Piazza : 8/3/2005 12:21:09 PM

Bears couldn't get the job done once again, and bulls are going to give it a try now. The OEX isn't moving much, trapped between Keltner support and resistance, but yesterday's front-runner the SOX is attempting to rise to test the gap from this morning, perhaps pumped up by MXIM's retest of yesterday's high. MXIM has come within a penny of yesterday's high.

Jeff Bailey : 8/3/2005 12:20:10 PM

12:05 Internals found at this Link

Jonathan Levinson : 8/3/2005 12:19:07 PM

Flying blind thanks to IB.

Linda Piazza : 8/3/2005 12:16:45 PM

Nothing's going on with the OEX. If it continues sideways much longer, it will invalidate the potential H&S just because the movement has been prolonged too long in time.

Jeff Bailey : 8/3/2005 12:11:12 PM

HMO Index (HMO.X) 1,537.05 +1.04% Link ... challenging its trending lower 21-day SMA here.

Jonathan Levinson : 8/3/2005 12:09:09 PM

IB has just crapped out again.

Jonathan Levinson : 8/3/2005 12:08:50 PM

Volume breadth offers no clues, still lightly negative at -1.1:1 on the NYSE and -1.14:1 on the Nasdaq.

Linda Piazza : 8/3/2005 12:08:11 PM

Yesterday's SOX-drive MXIM has risen to test yesterday's high, but hasn't yet quite been able to touch it.

Jeff Bailey : 8/3/2005 12:07:32 PM

12:05 Market Watch found at this Link

Jeff Bailey : 8/3/2005 12:04:19 PM

Google, Inc (GOOG) ... here's a chart I had put together on 05/11/05 Link ... what I'm doing is looking at "history" to try and get a feel for SIMILARITY, or DIVERGENCE, to then predict the future.

At this point (08/03/05) I'd be saying "Ugh! $287.75" if short/put.

Jeff Bailey : 8/3/2005 11:58:11 AM

Good Gravy! ... reading some GOOG commentary from 05/10/05 08:54:48 ... Link

Linda Piazza : 8/3/2005 11:53:35 AM

OEX still rolling into the right shoulder, but hasn't confirmed, of course, and there's reason for bearish concern in this right-shoulder area, as this is the point at which prices sometimes shoot higher to invalidate the formation.

I'm stepping away for a few minutes.

Jeff Bailey : 8/3/2005 11:56:01 AM

Google (GOOG) $297.67 -0.50% ... here's a 30-minute interval chart with QCharts' WEEKLY Pivot Levels. Also in place on this chart is "old" 100% of bullishly fit retracement (when I was profiling puts at much lower level in early May 05/09/05). Chart at this Link ... in a minute, I'll follow with my GOOG chart with a "bear fit 38.2%," which would have $300.85 a potential key near-term level of resistance.

Tab Gilles : 8/3/2005 11:46:49 AM

EUR/USD Link

GLD Link

Chart from 7/12 Link

Linda Piazza : 8/3/2005 11:43:17 AM

The OEX turns down at what would be an appropriate right-shoulder level or maybe just a little higher than would be liked for the H&S on its 15-minute chart, but this just-turning-over point is one in which many potential H&S's are invalidated by a sharp rise. This formation has a descending neckline and can actually be discerned more easily on a line drawing than on a bar chart. The neckline is currently at about 575.20, but is descending.

Jonathan Levinson : 8/3/2005 11:40:41 AM

Session high for ten year notes aat 110 57/64, TNX losing 4.3% support and now down 4.4 bps at 4.292%. QQQQ is coiling in a pennant here on the 100 tick chart, the short cycle indicators currently chopped up and directionlesss: Link

Linda Piazza : 8/3/2005 11:39:54 AM

TRAN still testing that 3804-3806 resistance area, at 3805.92 as I type. Next resistance up near 3813 on a Keltner basis.

Jonathan Levinson : 8/3/2005 11:30:37 AM

Oct. gold is holding a 3.8 gain at 438.50, engulfing yesterday's doji star as the daily cycle approaches overbought territory. 439 is next resistance, 20 cents above the session high, followed by stiffer resistance at 444, at descending trendline resistance. Link

Jeff Bailey : 8/3/2005 11:40:18 AM

Hanover Compressor (HC) $14.58 (unch) ... while having been stopped out in opening minutes of trade at $14.25 on news of pending secondary offering, HC back to unchanged.

Traders/investors that may still be holding a position, I'd seriously consider selling $15 Calls on thought that secondary gets done somewhere between $14-$15

MONTHLY Pivot Levels ... $10.28, $12.41, Piv= $13.58, $15.71, $16.88.

Linda Piazza : 8/3/2005 11:25:41 AM

BIX bouncing from its 200-ema test and also from the test of Friday's low. It hasn't confirmed a double-bottom formation yet, though, and will face the 15-minute 100/130-ema's before doing so, with those averages at 362.87 and 363.26, respectively. BIX at 362.08.

Linda Piazza : 8/3/2005 11:23:31 AM

OEX testing Keltner resistance at 577.07 on 15-minute closes. Same old, same old for the OEX. Just a lot of bumping around within that channel that's contained it so long. There's a hint of bearish Keltner-style divergence as this test occurs, and the OEX hasn't really invalidated the potential H&S on the 15-minute chart, but it's getting close. It has tended, however, to form rough H&S's as it tests the top of this channel, and rough inverse H&S's as it tests the bottom, so this is a pattern that's indicative of what it's done lately before rolling through to the bottom of the channel. That's about all that can be said so far, and this OEX behavior is the reason that I suggested earlier today that those who don't have to be in the markets all the time might just stand aside until there's a clear impulsive move and then a failed retest, one direction or the other.

Jonathan Levinson : 8/3/2005 11:22:16 AM

QQQQ bounces back to 40.00 from a higher intraday low after an abysmally weak 30 min cycle downphase. A failure from a lower high could confirm the 30 min downphase, but so far it's been entirely corrective this AM. Link

Jane Fox : 8/3/2005 11:13:42 AM

Jonathan - Merci

Jonathan Levinson : 8/3/2005 11:13:07 AM

Jane, and anyone else having IB trouble, try closing and restarting IB. If all else fails, reboot and restart- that worked for me this AM.

Jeff Bailey : 8/3/2005 11:12:37 AM

Yesterday's Internals found at this Link

Jeff Bailey : 8/3/2005 11:11:47 AM

11:00 Internals found at this Link

Jeff Bailey : 8/3/2005 11:08:38 AM

Delta Airlines (DAL) $2.45 -3.16% ... notable new 52-weeker at the big board.

Jonathan Levinson : 8/3/2005 11:08:27 AM

Despite several tests this AM, 4.3% support continues to hold on the ten year note yield, TNX down 3.6 bps at 4.30%.

Jonathan Levinson : 8/3/2005 11:07:36 AM

Volume breadth -1.18:1 on the NYSE and -1.13:1 on the Nasdaq.

Linda Piazza : 8/3/2005 11:07:30 AM

Also with some trepidation, I mention that many indices have possible H&S's at the top of their climbs on the 15-minute charts, most with descending necklines. The SOX and OEX are examples.

Linda Piazza : 8/3/2005 11:05:52 AM

On a Keltner basis at least, the RUT is underperforming some other indices today. It has Keltner support at 681.69-682.14, and it's trying to bounce above that but facing 684.50-684.66 next resistance. It's at 683.56 as I type. It still remains within its long-term rising regression channel, above both the 10 and 21-dma's and above the best-fit trendline on its bearish (she says, with some trepidation) rising wedge's best-fit supporting trendline, so it's certainly not showing terrible behavior, but it's not leadin to the upside, either, but rather to the downside by some measures.

Jeff Bailey : 8/3/2005 11:03:43 AM

11:00 Market Watch found at this Link

Jonathan Levinson : 8/3/2005 11:02:02 AM

Sept. crude down to a .075 gain at 61.975, off its low of 61.35.

Linda Piazza : 8/3/2005 11:01:29 AM

RLX still below its 10-sma, still above 480.

Linda Piazza : 8/3/2005 11:00:23 AM

OEX just hanging in space between 15-minute Keltner support and resistance, with next support at 576.10 and next resistance at 576.89 and the OEX at 576.37.

Jeff Bailey : 8/3/2005 11:00:16 AM

WellPoint (WLP) $73.78 +0.55% ...

Tab Gilles : 8/3/2005 11:00:39 AM

Time Warner (TWX) Monday- I questioned if TWX was breaking out of it's downtrend channel? Link

Today's news of a loss and settelement payments has appeared to held off any breakout. Link Link

Jeff Bailey : 8/3/2005 10:59:51 AM

Cigna (CI) $114.80 +5.90% ... continues to surge.

Jonathan Levinson : 8/3/2005 10:57:34 AM

Back to find MSFT at session highs, up 2.2% here at 27.40, QQQQ at gap resistance at 40.03. 30 min channel resistances lines up with the 60 min channel top at 40.10, but those levels will rise as QQQQ holds above the 72 SMA at 39.95.

Linda Piazza : 8/3/2005 10:56:08 AM

Instead of testing its upside gap from yesterday, SOX-driver MXIM has risen to test this morning's slight downside gap, testing the bottom as I type.

Linda Piazza : 8/3/2005 10:54:53 AM

Now is the time we get to see if the markets really meant that slight downturn this morning, by the height to which these bounces go.

Jeff Bailey : 8/3/2005 10:53:26 AM

Utility Index (UTY.X) 440.37 +1.27% ... surging to new all-time high.

Linda Piazza : 8/3/2005 10:52:59 AM

The OEX has popped above the Keltner line currently at 576.08, but hasn't yet closed above it. Next Keltner resistance at 576.94 and then at 577.49 on 15-minute closes.

Jonathan Levinson : 8/3/2005 10:52:25 AM

Hearing from others that IB is out- trying a reboot.

Jeff Bailey : 8/3/2005 10:52:09 AM

VIX.X 11.79 +0.34% ... session low.

Jeff Bailey : 8/3/2005 10:50:33 AM

QQQQ $40.01 -0.17% ...

Jeff Bailey : 8/3/2005 10:50:11 AM

Pacholder High Yield (PHF) $9.83 +0.71% ... good gravy! Ticking to a 4.5 month high.

Jeff Bailey : 8/3/2005 10:48:43 AM

NYSE Composite (NYA.X) 7,559.89 ... session and all-time high.

Linda Piazza : 8/3/2005 10:47:06 AM

RUT also trying to bounce from the 15-minute 100/130-ema's, at 682.45 and 681.26, respectively, with the RUT LOD at 682.63.

Jeff Bailey : 8/3/2005 10:47:47 AM

Coca Cola (KO) $44.31 +0.06% ... edges green after session low of $43.87.

Dow 30 breadth still negative at 18:12. MSFT $27.33 +1.90%, SBC $24.84 +0.72% ... MMM $74.33 -0.72%, PFE $26.75 -0.70%, HD $42.12 -0.68%

Linda Piazza : 8/3/2005 10:45:46 AM

The TRAN is still trying to steady at and rise from its 15-minute 100/130-ema's. These averages have played a part in bouncing various indices or marking a short-term change in behavior since early July. They're at 3800.77 and 3795.30 for the TRAN, and it's now at 3804.76, rising into that 3804-3806 next resistance zone.

Jonathan Levinson : 8/3/2005 10:45:02 AM

Still no pulse from IB.

Jeff Bailey : 8/3/2005 10:44:40 AM

S&P Depository Receipts (SPY) $124.39 ... comes back to unchanged. See last night's notes regarding 12-month high short interest.

Jonathan Levinson : 8/3/2005 10:39:10 AM

Just lost my IB feed.

Linda Piazza : 8/3/2005 10:36:40 AM

The BIX shows contradictory chart characteristics on its 15-minute chart. It's broken below a rising trendline off Friday's 3:45 low, but there are some Keltner-style bullish divergences on that chart, too. That may at least suggest that the BIX is going to try to rise from its 200-ema and retest nearest Keltner resistance, first at 361.80 and then 362.30-362.40 on 15-mintue closes. BIX at 361.33 as I type.

Jonathan Levinson : 8/3/2005 10:35:04 AM

QQQQ zigged and zagged, but remains within its premarket range. The short cycle upphase continues to deliver nothing more than sideways chop, but the 72 SMA is down to 39.96, above which the 30 min cycle downphase will stall. Link

Linda Piazza : 8/3/2005 10:32:40 AM

The RLX is currently below its 10-sma. It bounced from this average both Monday and Tuesday, but hasn't so far today. OEX bulls need the RLX. It may find support near 480 and then attempt to bounce up into a right shoulder for a possible H&S on the 60-minute chart, with the RLX now at 482.25.

Jonathan Levinson : 8/3/2005 10:31:39 AM

Headlines:

U.S. DISTILLATE STKS UP 1.5 MLN BRLS: ENERGY DEPT

U.S. GASOLINE STKS DOWN 4 MLN BRLS: ENERGY DEPT

U.S. CRUDE STKS UP 200,000 BRLS LAST WK: ENERGY DEPT

Jonathan Levinson : 8/3/2005 10:31:15 AM

Sept. crude holding a 50 cent gain at 62.40 in the wake of the release.

Jonathan Levinson : 8/3/2005 10:30:24 AM

From the EIA website:

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) inched up by 0.2 million barrels from the previous week. At 318.0 million barrels, U.S. crude oil inventories remain above the upper end of the average range for this time of year. Total motor gasoline inventories fell by 4.0 million barrels last week, putting them in the lower half of the average range. Distillate fuel inventories rose by 1.5 million barrels last week, and are near the upper end of the average range for this time of year. A sharp increase in low-sulfur distillate fuel (diesel fuel) more than compensated for a decline in high-sulfur distillate fuel (heating oil). Total commercial petroleum inventories rose by 4.9 million barrels last week, and are at the upper end of the average range for this time of year.

Jeff Bailey : 8/3/2005 10:27:37 AM

In consultation with Drake the dog on just what to do with my one (1) PetSmart (PETM) $28.61 -3.24% Link January $30 call.

He thinks we need to go over and price some of his favorite toys priced in China to see if margins are under pressure.

Linda Piazza : 8/3/2005 10:25:55 AM

The TRAN usually adheres fairly well to the Keltner S/R on its 15-minute chart. It's now testing mid-channel S/R as we head into inventories numbers. A sustained drop below and 15-minute close below the Keltner line currently at 3792.18 suggests a drop down to 3756.86, but be careful of assumptions as we await inventories numbers. Also, the TRAN's 10-sma is at 3778.73, between the current level and that downside target. The TRAN is at 3797.60 as I type.

Jeff Bailey : 8/3/2005 10:24:28 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 8/3/2005 10:23:36 AM

SOX just hit a new LOD, piercing the 61.8% retracement of yesterday's range again, but then quickly bouncing right back up to the midpoint, at about 482.30. The SOX is at 482.29 as I type.

Tab Gilles : 8/3/2005 10:23:21 AM

$SOXX Link

SMH Link

Materials Select sector (XLB) Link Link

Jonathan Levinson : 8/3/2005 10:20:43 AM

Sept. crude oil is up .375 at 62.275, today's high 62.50 and low 61.80.

Jonathan Levinson : 8/3/2005 10:20:11 AM

Session high for ten year notes at 110 27/32, TNX down to 4.302% and now testing 4.3% support.

Jonathan Levinson : 8/3/2005 10:17:52 AM

The short cycle indicators are on a bullish cross but so far generating poor traction below 39.97 resistance. Link

Linda Piazza : 8/3/2005 10:17:21 AM

OEX still doing okay for those who hope for a downturn through the Keltner channel that's been containing it for several weeks. It's testing mid-channel support and trying to bounce from that, but so far finding resistance at 576.03 on 15-minute closes, where short-term bears hope it will. Remember that inventories numbers can change everything, either direction. OEX at 575.90 as I type. As I mentioned in my first OEX-related post this morning, trading is iffy right now.

Jeff Bailey : 8/3/2005 10:16:22 AM

S&P Insurance (IUX.X) 334.72 +0.15% ... edges green.

S&P Banks (BIX.X) 361.02 -0.52% ... session low.

Jeff Bailey : 8/3/2005 10:15:23 AM

Global ePoint (GEPT) $7.25 +3.71% ... "bad tick" to $8.00.

Jeff Bailey : 8/3/2005 10:14:36 AM

SAP Aktiengesell (SAP) $43.63 +0.87% ... fills its downgrade gap from 07/23 call out of Morgan Stanley.

Linda Piazza : 8/3/2005 10:12:55 AM

SOX bouncing from a 61.8% retracement of yesterday's range, up to retest the 50% retracement, this time from the underside. It's minimally above that 50% retracement as I type, with that at 482.30 and the SOX at 482 . . . oops, lost it, and is now at 482.23.

Jeff Bailey : 8/3/2005 10:12:42 AM

10:00 Internals found at this Link

Linda Piazza : 8/3/2005 10:08:45 AM

TRAN at 3795.23, slipping just below the 15-minute 100/130-ema's, but not by much. Still within testing range.

Jonathan Levinson : 8/3/2005 10:05:52 AM

Headlines:

U.S. JULY ISM SERVICES EMPLOYMENT 56.2% VS 57.4% JUNE

U.S. JULY ISM SERVICES NEW ORDERS 61.9% VS 59.5% JUNE

Jonathan Levinson : 8/3/2005 10:05:32 AM

Nasdaq volume breadth is holding just barely negative at -1.05:1, price refusing to break the premarket lows as the short cycle indicators gather in oversold territory. Link

Jeff Bailey : 8/3/2005 10:04:16 AM

10:00 Market Watch found at this Link

Linda Piazza : 8/3/2005 10:03:37 AM

OEX testing mid-channel support down to 575.03 on 15-minute closes. If the OEX should drop below this on a close, next support is 573.74, the bottom of the channel that has been containing most OEX movements for three weeks. Those in bearish positions should have profit-protecting plans in place for a test of that channel line, if it occurs. Decide ahead of time if you want to automatically exit, just lower stops, exit part of a position and lower stops on the rest, etc. As I type, the OEX is trying to bounce, and nearest resistance is 576.07 on a 15-minute close.

Jonathan Levinson : 8/3/2005 10:02:13 AM

No net change from QQQQ at 39.91 here, TNX holding its 2.5 bp decline at 4.311%.

Jonathan Levinson : 8/3/2005 10:01:40 AM

Headlines:

U.S. JULY ISM SERVICES 60.5% VS 62.2% IN JUNE

U.S. JULY ISM SERVICES BELOW CONSENSUS 61.4%

Linda Piazza : 8/3/2005 10:01:16 AM

SOX has now retraced 61.8% of yesterday's range. Top of the gap for the SOX is at 478.25, with the SOX at 481.28. If the SOX should continue declining, watch for possible gap support there.

Jonathan Levinson : 8/3/2005 10:01:13 AM

ISM Services 60.5 vs. 61 exp., prior 62.2.

Jonathan Levinson : 8/3/2005 10:00:47 AM

Headlines:

U.S. JULY LAYOFF PLANS DOWN 7% TO 102,971: CHALLENGER

U.S. JULY LAYOFFS UP 48% FROM JULY 2004

U.S. LAYOFF PLANS UP 18% YEAR-TO-DATE: CHALLENGER

Jeff Bailey : 8/3/2005 10:00:12 AM

Sell Program Premium ... SPX 1,240.99, DIA $106.42, QQQQ $39.90

Linda Piazza : 8/3/2005 9:59:45 AM

Part of the SOX's strong gain yesterday was prompted by MXIM's spectacular gap higher, with MXIM having an 8.25% weighting in the SOX according to the information I have. As I type, MXIM declines toward the top of that gap, at 44.55, yesterday's low. Gaps, particularly such big ones, can have gap support at the top, midpoint, or bottom, and at Fib levels within the gap. Watch for possible support at the top of the gap, with MXIM now at 44.70. SOX bulls don't want to see MXIM drop below the midpoint of yesterday's gap higher, I would think, with that midpoint at about 43.40.

Jeff Bailey : 8/3/2005 9:58:42 AM

S&P Banks (BIX.X) 361.78 -0.31% ...

VIX.X 11.90 +1.27% ... defensive look into the weekly energy inventory figures.

Jonathan Levinson : 8/3/2005 9:58:18 AM

The Fed has announced a 9.5B overnight repo to replace the 7B expiring, for a net add of 2.5B today.

Jonathan Levinson : 8/3/2005 9:57:04 AM

Volume breadth has firmed here, now -1.2:1 on the NYSE and -1.08:1 on the Nasdaq.

Linda Piazza : 8/3/2005 9:56:50 AM

The SOX is dropping this morning, gapping slightly lower, but it's still finding support on the midpoint of yesterday's range and it's still above that top trendline of the rising regression channel on the weekly chart. Take that approximate 478.15 top of that trendline with a grain of salt, though, as this is a long-term trendline on a weekly chart, and when translated to a daily chart, just a little bit of a wrong angle on that trendline can make several points' difference. Since this is a weekly chart, the weekly close is also what's important and not intra-week movements if we're to determine whether the SOX has broken to the upside out of this channel. That doesn't help bears trying to make decisions on positions in trouble, however, so be careful with your stops. Note: As I typed, the SOX inched just below the midpoint of yesterday's range, but by less than a point.

Linda Piazza : 8/3/2005 9:53:24 AM

The Wilshire 5000 dropped heavily during the first 15-minute period, too, but dropped only to an ascending trendline off 15-minute swing lows since 11:00 yesterday. It's attempting a bounce from that trendline, now at about 12,438.75, with the DWC at 12,442.06 as I type.

Linda Piazza : 8/3/2005 9:51:29 AM

TRAN took a big hit this morning and dropped below 3804 and 3800, both. It's testing the 15-minute 100/130-ema's that have been prompting bounces on so many indices, with those at 3800.96 and 3795.20, and the TRAN currently at . . . well, just bounced to 3800.32 as I typed.

Jonathan Levinson : 8/3/2005 9:51:03 AM

QQQQ's 30 and 60 min channels are pointing lower, but price is net unchanged from premarket levels and the short cycle downphase is looking bottomy in oversold territory. The 10AM and 10:30AM data should provide a spur. Bears need a break of the current channel bottoms at 39.85, bulls need to see north of 40.02 to confirm a new short cycle upphase and stall the longer intraday cycles.

Linda Piazza : 8/3/2005 9:50:15 AM

Remember that we still have potentially market-moving releases at 10:00 and 10:30 this morning.

Jeff Bailey : 8/3/2005 9:52:50 AM

Hanover Compressor (HC) alert $14.30 -1.92% ... saying it plans to sell about 11.18 million common shares, subject to market conditions, and will use the proceedes to repay existing debt. Company will grant underwriters an option to purchase up to an additional 1.68 million common shares to cover over-allotments, if any. HC currently has about 87.04 million shares outstanding. Credit Suisse and J.P Morgan will act as joint book-running managers of the offering.

What do you think? They'll price it somewhere between $14 and $15 is my thought. WEEKLY Pivot $13.99 if they do it this week.

Linda Piazza : 8/3/2005 9:48:03 AM

OEX closed a 15-minute period below the Keltner line currently at 576.27, so currently follows the path that those who are playing the channel (bearish entries on top touch, bullish on bottom) are getting the first confirmation. Support is firming from 575.03-575.58, however, so without a strong swoosh down, that line may get retested.

Linda Piazza : 8/3/2005 9:43:48 AM

The BIX is falling back today from its test of the 15-minute 100/130-ema's at the close yesterday, but the BIX has not yet violated its (possible bear) flag's supporting trendline, now at about 361.64. It briefly pierced this trendline this morning, but then bounced up a little. BIX at 361.94 as I type, with the 200-ema's proven support waiting below at 360.93 and the 100-sma's at 359.37.

Jeff Bailey : 8/3/2005 9:45:16 AM

Hanover Compressor (HC) $14.26 -2.19% ... session low came in first 5-minutes to $14.00. I'm going to place a stop at $14.20 in my personal account, but record the $14.25 stop for MM profiles. I'm very "underweighted" any type of energy exposure in my personal holdings.

Linda Piazza : 8/3/2005 9:41:06 AM

DJUSHB dropping back from yesterday's end-of-day challenge of 1100. It's testing a potential H&S neckline that's right at the boundary of its long-term rising regression channel and also 15-minute 100/130-ema's. The DJUSHB briefly broke out of this channel this week, but then climbed back inside it. The 100/130-ema's are at 1093.09 and 1092.08, but the daily 21-sma has been roughly congruent to the bottom of the DJUSHB's rising support all the way up since May, and so I'd think that there would need to be a close below that average at 1077.89 before we could even begin to think that the DJUSHB was breaking out of that channel. DJUSHB at 1092.87 as I type. I'm watching this to show whether some key high-flying indices are maintaining upside trends or beginning to show any sense of pulling back.

Jonathan Levinson : 8/3/2005 9:41:05 AM

QQQQ holds within its premarket range. 39.97 is upside resistance below the 72 SMA at 40.01: Link

Jonathan Levinson : 8/3/2005 9:40:12 AM

Ten year notes extend their gains, now up 5/32 at 110 47/64, TNX now down 2.5 bps at 4.311%.

Jonathan Levinson : 8/3/2005 9:39:09 AM

Volume breadth is lightly negative, -1.55:1 on the NYSE and -1.12:1 on the Nasdaq, TRIN and TRINQ neutral at .97 and .69 respectively.

Linda Piazza : 8/3/2005 9:35:57 AM

SOX trying to bounce from an exact test of the midpoint of yesterday's range. If the bounce continues, bulls want a higher high; bears, a lower one.

Linda Piazza : 8/3/2005 9:35:08 AM

Big drop in the RLX, bringing prices below the rising trendline off the Aug 1 low. That trendline is now at about 485.23, with the RLX at 483.81 as I type, and perhaps headed down to retest those important 15-minute 100/130-ema's, at 482.81 and 481.01, respectively. OEX bears want to see the RLX below 479, however.

Jeff Bailey : 8/3/2005 9:38:29 AM

Bullish swing trade stop alert for Hanover Compressor (HC) $14.09 at $14.25.

Jeff Bailey : 8/3/2005 9:33:21 AM

WellPoint (WLP) $73.40 +0.04% Link ...

Linda Piazza : 8/3/2005 9:32:46 AM

SOX dropping,having now fallen more than 38.2% of yesterday's range. A 50% retracement is at about 482.30, and such 50% marks sometimes offer support. If there's a SOX bounce, SOX bears want to see a lower high.

Linda Piazza : 8/3/2005 9:31:41 AM

The OEX opens lower and heads down through its Keltner channel on its 15-minute chart. It needs a 15-minute close beneath a Keltner line currently at 576.42 to make a bet that it will be more likely to challenge 575-ish Keltner support than 577.25-ish Keltner resistance.

Jeff Bailey : 8/3/2005 9:32:39 AM

Cigna (CI) $113.00 +4.24% Link ... gaps to all-time high after the employee benefits provider reported quarterly results that beat Wall Street's estimates.

Jeff Bailey : 8/3/2005 9:29:39 AM

Light Crude Oil Continuous ($WTIC) ... conventional $0.25 box chart at this Link should find support firming at $59.75-$60.00, with bullish vertical count hinting at $66.50.

$0.50 box, which removes some noise at this Link

$1.00 box at this Link

Jonathan Levinson : 8/3/2005 9:26:28 AM

From the MBA's website:

WASHINGTON, D.C. (August 3, 2005) - The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending July 29. The Market Composite Index - a measure of mortgage loan application volume - was 752.1, a decrease of 0.3 percent on a seasonally adjusted basis from 754.3 one week earlier. On an unadjusted basis, the Index decreased 0.3 percent compared with the previous week but was up 20.7 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index increased by 1.9 percent to 494.5 from 485.1 the previous week whereas the Refinance Index decreased by 3.0 percent to 2250.3 from 2320.3 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which decreased 0.4 percent to 1130.1 from 1134.9 the previous week, and the Government Index, which increased 2.1 percent to 121.3 from 118.8 the previous week.

Jonathan Levinson : 8/3/2005 9:24:11 AM

Don't forget the petrol inventory data today at 10:30AM. Crude oil supplies are expected to have fallen 1.6M barrels in the week ended July 29. Distillates are expected to increase 1.9 million barrels.

Jeff Bailey : 8/3/2005 9:22:13 AM

Utilities Select Spyders (AMEX:XLU) $32.59 Link ... 2,000,000 shares crossed the wire at 09:02:00 AM EDT.

Jeff Bailey : 8/3/2005 9:20:34 AM

Reebok Intl. (RBK) $43.95 Link ... surging to $57.34 in pre-market trade after the athletic shoe maker said it received a friendly take over offer from adidas-Solomon in a deal valued at $3.8 billion ($59 a share).

Jeff Bailey : 8/3/2005 9:15:49 AM

Program Trading Levels for Wednesday ... HL Camp & Company has their computers set for program buying at $+3.54 and set for program selling at $+1.14.

Jonathan Levinson : 8/3/2005 9:12:41 AM

Calpine (CPN) reports a Q2 loss that widened from 28.7M or 7 cents in Q2 2004 to 298.5M or 66 cents per share. The loss net of discontinued operations was 51 cents, worse than estimates of a 29 cent loss. CPN is down 48 cents or 12.37% in premarket trading.

Jonathan Levinson : 8/3/2005 9:06:03 AM

Crude oil holds its gains, +.50 at 62.40 here, off a session high of 62.50.

Jonathan Levinson : 8/3/2005 9:02:15 AM

Ten year notes have crept up another 1/64 to 110 23/32, with TNX now down 1.1 bps to 4.325%. This week's range bottom is at 4.3%, resistance at 4.35%. Link

Jonathan Levinson : 8/3/2005 8:55:34 AM

QQQQ's 72 SMA got pulled up to 40.03, and price is holding well below it, currently testing the channel bottom at 39.92. The 30 min cycle oscillators have kicked off a downphase from a lower cycle high against the higher price high, while the 60 min cycle indicators are overbought but not yet showing any sign of rollover. If this weakness persists for the first 20-30 mins of the cash session, the 60 min cycle will join in to the downside.

Jane Fox : 8/3/2005 8:55:03 AM

Dateline WSJ Today's expected announcement that the U.S. will bring back the 30-year Treasury bond after a four-year hiatus could help secure Americans' pension benefits, boost Wall Street profits and even increase long-term interest rates.

Which isn't to say the return of the "long bond," as it is often referred to by traders, would be a triumph for Uncle Sam. The government would effectively be recognizing a need to finance large budget deficits far into the future. Still, it would be good news for many investors and for people who make their living trading bonds.

Jane Fox : 8/3/2005 8:51:39 AM

Of course if this continues we have a flattening of the yield curve and eventually it will become inverted. History has shown us that if we get an inverted yield curve within 6-12 months we have a recession. I'm sure the FED understands this though.

Jane Fox : 8/3/2005 8:46:18 AM

Dateline WSJ As the Federal Reserve prepares to raise short-term interest rates again next week, officials there increasingly believe the bond market, which sets long-term rates, is diluting their efforts to tighten credit and contain inflation.

The result: The longer the bond market keeps long-term rates unusually low, the further the Fed is likely to raise the short-term rates it controls in an effort to keep the economy from overheating. Conversely, sharply higher bond yields would encourage the Fed to stop raising short-term rates.

This dynamic marks a striking break from the past when the Fed typically saw sharply higher bond yields as a reason to lift short-term rates further and low yields as a reason to worry about the economy.

Fed officials say future rate moves mostly depend on what data indicate about growth and inflation. With inflation low but the economy steadily using up unused capacity, officials plan to keep raising short-term rates to "neutral," a level thought to be between 3% and 5% that neither stimulates nor restrains economic growth. The bond market's unusual behavior is complicating that strategy by making it harder to know where neutral is.

Some policy makers worry that bond yields are being kept in check by overly complacent investor sentiment which could rapidly dissipate, pushing up mortgage rates and shaking the housing market. Indeed, some Fed officials see similarities between the attitudes of bond investors today and of stock investors in the late 1990s.

Linda Piazza : 8/3/2005 8:44:02 AM

Before I begin, I have to say that my concentration on the OEX in my MM commentary has somewhat confused my interpretation of what's going on in the markets. The OEX is just not doing what the other indices have been doing, and so that's weighed down my opinion of what's going on in the broader markets, perhaps more than it should have done. If I were a RUT trader or commentator, I would have clearly been able to pick out the trend and would be stating emphatically that no trend change has yet been evidence. Scary as the RUT's nearly straight-up climb has been, I'd have been more comfortable buying the dips. The OEX has been much trendless, just oscillating around. But since I primarily comment on the OEX, let's look at it, starting with a longer-term view of what's happening, but starting first with its bigger sibling, the SPX.

As others have mentioned, the SPX is approaching a 61.8% retracement of its bear-market decline, with that number near 1252, according to a snapped-on Fib chart and not a more exact calculated number. SPX 1250 might be both a price magnet and potential resistance. The OEX hasn't matched the SPX's performance by far. It's still below a 50% retracement, not so far above the 38.2% retracement at 561.23. It's moving up into a long-term resistance band on the monthly chart, roughly from 577.40-578.60, but expanding some on either side of that band. For example, the July 1998 swing high was 582.27, before the fall into that year's October low. November 1998 closed at 577.19 and December opened there. All through August 2001-April 2002, the OEX was seeing almost every month open or close within that band, although there were intra-month spikes both below and above it. The OEX then fell away to its bear-market low. In January 2004, the OEX saw a high of 573.44 before it fell away into 2004's low. December 2004-March 2005, the OEX was producing monthly candles that spiked up into that zone but that fell back with candle bodies opening or closing at or just below that resistance zone. It's a powerful zone. Perhaps it's time for the OEX to finally punch above it, but I'd be awfully careful with bullish positions here.

With that caution expressed, the OEX's monthly pattern may resemble a cup-and-handle formation, a typical continuation-form pattern. The handle may be too big in relationship to the cup part to make it a classic formation, giving some doubt as to whether it will resolve to the upside. Bulls haven't been able to get the job done as soon as they should, perhaps. On a daily chart, the OEX remains within the rising regression channel that's been forming since early July as the OEX challenges this resistance. The OEX did not reach a new high yesterday and did not break above this zone. It's in a broadening formation, but one that's broadened way too far in relationship to the rise that preceded it. Because of that, we can't be sure that it has any validity other than to show us that breakouts and breakdowns have been difficult to identify since late May, when this began forming. The daily chart is just a mess since November or December of last year, with prices just rattling around sort of within a rectangular formation, with most price movement between 556 and 579 or so. There was one big spike to the upside and one to the downside.

So that's the picture. About all we can conclude is that the OEX has been consolidating for a long, long time, and that it's facing massive resistance, and that spikes outside this consolidation have up to now been reversed after several days or weeks. Looking at that chart, it's no wonder that OEX traders have had a hard time for a couple of years now. Let's consider a shorter-term chart, the 15-minute Keltner chart. Twice yesterday, the OEX rose to test the upper resistance of the channel that has been containing it for several weeks now. Once, it actually broke above that resistance for a few minutes, but I warned readers that it looked as if it might reverse back inside, and it did. It tested that channel line late yesterday again, actually reaching a new HOD and then falling back, but not far. On a 15-minute close above that Keltner line, now at 577.32 on a 15-minute close, the OEX sets an upside target of 579.48, but that's a target that's plowing right thought that long-term resistance band, and I don't trust it. If the OEX is going to break through that band and soar higher, we can then expect a pullback--perhaps not immediately--and retest of that long-term resistance, and a successful retest would mark the right time to enter a long position. If you want to consider a long position on a 15-minute signal, go ahead, but you risk getting chopped to pieces as the OEX decides whether it's going to break through or rollover.

Until there's a strong move down and then a retest that fails at an equal or lower high, we don't have a signal that a rollover is in progress, either. Now might be a good idea to wait it out and let those bulls and bears chop each other to pieces. When one has emerged victorious from this OEX battle with that resistance band, and has then come back to kick the vanquished one to make sure it's still dead (a retest), that's the time to enter. Those of you who don't have to be in the market every day might wait for that clearer picture. Those who do have to be in the market every day might continue to trade that 15-minute Keltner channel's boundaries (now 577.32 and 573.79 on 15-minute closes), selling high and buying low, until the OEX changes that pattern. Another option is trading breakouts of that channel, but in either case, be sure you have your stops in place and know that you'll adhere to them.

Jonathan Levinson : 8/3/2005 8:27:31 AM

Session highs for Oct. gold at 437.50 and Sept. silver at 7.328, ten year notes holding light gains with TNX down .2 bps at 4.334%.

Jonathan Levinson : 8/3/2005 7:29:39 AM

Equities are lower, ES trading 1244.5, NQ 1627.5, YM 10675 and QQQQ -.12 to 39.96. Gold is up 1.7 to 436.4, silver +.025 to 7.286, ten year notes +5/64 at 110 43/64 and crude oil is up .575 to 62.475.

We await the 10AM release of ISM Services, est. 61.

Linda Piazza : 8/3/2005 6:46:20 AM

Good morning. The Nikkei finally touched 12,000 last night, but then fell back and closed a few points below its opening level, creating a doji for the day at 12,000 resistance. Other Asian markets were mixed. European markets decline today. Our futures are slightly lower as of 6:31 EST. As of the same time, gold is higher by $1.90. Ahead of today's inventories numbers, crude is higher by $0.37, to $62.26. More detail about Asian and European markets follows in succeeding paragraphs.

Although crude had moved higher during the overnight session, the Nikkei opened just under 12,000, at 11,987.98, and spent the rest of the morning session trying to achieve that level, but it wasn't to hit that target until early in the afternoon session. Immediately after hitting its 12,009.56 high of the day, the Nikkei dove almost 60 points, with a late-day buying spurt then bringing it up off that low of the day in what must have been a challenging trading day on the Nikkei. The day's candle was a doji at 12,000 resistance, after a strong climb, so market investors will be interested in seeing if there's a completion of a possible evening-star pattern on the daily chart tomorrow. As I mentioned earlier this week, the Nikkei has produced many a reversal signal on its way higher without reversing, so it's difficult and dangerous to put too much credence in a possible reversal signal at this point. Still, it's something to watch.

A battle is brewing in Japan over a postal privatization bill. Prime Minister Junichiro Koizumi spoke at a Q&A session Tuesday. According to the Japan Business News Online, the prime minister has threatened to dissolve the lower house for a general election if the upper house does not pass the bill. He reportedly considers a vote against the bill as a call for retirement. The vote is to be conducted Friday as Koizumi wants, but some chatter this morning indicates there may be a move to postpone the vote to next week, something Koizumi doesn't want. The same source reports the Bank of Japan's current-account balance might dip below the liquidity target. July's Small Business Confidence was to be released Wednesday, but I haven't found any notation about that number.

Mining, steel stocks, and automakers led early gainers, and most ended the day positive. An article on Bloomberg noted that Toyota Motor Corp, Nissan Motor Co. and Honda Motor Co. lost market share to U.S. competitors in July. Each of the three posted sales gains of at least 8%, however, with sales for all Japanese and South Korean car manufacturers rising 9.1% over the year-ago level, but those summer discounts from U.S. manufacturers cut into market share. Ford, DaimlerChrysler, and GM all saw gains in the double-digits. This month marked the first time since 2002 that the Asian automakers lost market share in the U.S. two months in a row to their U.S. counterparts. However, sales were still strong among the Asian manufacturers without the need to offer discounts, so the automakers benefited in Wednesday's trading. Suzuki Motor Corp. announced earnings yesterday that pleased investors, with those investors having their first opportunity Wednesday to react to those earnings. Profit rose to the highest level in more than two years. Toyota was due to report later in the day. Bridgestone reported that it would build a factory in southern China, with that factory slotted to produce the steel cords for bus and truck tires, and Bridgestone posted a positive day, too.

In the semi-conductor sector, Tokyo Electron gained in early trading after MXIM raised expectations for sales. Casio Computer Co. and Tohoku Electric Power Co. fell in early trading after disappointing with their earning reports. In other news, Mitsubishi Corp. announced that its wholly owned subsidiary Diamond Generating Corp. would buy Calpine's interest in a cogeneration plant in Morris, Illinois. A Marketwatch.com article noted that this would Mitsubishi's tenth investment in power-plants in the U.S. Mitsubishi Corp. gained in early Japanese trading after gaining yesterday in U.S. trading. KDDI also was involved in M&A news, with the company trading lower on speculation that it might by a TEPCO telecom subsidiary.

Other Asian markets were mixed. The Taiwan Weighted gained 1.77%, but South Korea's Kospi lost 0.15%. Singapore's Straits Times declined 0.50%, and Hong Kong's Hang Seng fell 0.12%. China's Shanghai Composite rose 0.33%.

European markets decline ahead of ECB and BOE rate decisions expected tomorrow. The ECB is not expected to change its monetary position, while some expect the Bank of England to cut rates by 25 basis points. In Europe, the Eurozone and individual country July services PMI figures have been coming in. France's was much worse than expected, dropping to 55.3 from the previous 57.9 when an unchanged number had been expected. Italy's rose to the benchmark 50.0, improving as had been expected. Germany's has risen to 53.8 although business expectations declined, the employment component remained beneath that benchmark 50.0 and the prices charged did not gain in proportion to the jump in input costs, suggesting that costs could not be passed on. The Eurozone figure rose to 53.5 from June's 53.1, with business expectations dropping to its lowest level since last November, and the inflation-measuring component showing a rise. Other components were more positive. The U.K.'s number rose to 56.3 from the previous 55.8, although here, too, business expectations eased a little. This number increased fears that the Bank of England may not cut rates as has been hoped. Although some hope and believe that the Bank of England may cut rates, others worry that data will encourage the BOE to keep rates steady, a disappointment if that happens. The Eurozone's June retail sales climbed 0.4% month over month and 0.9% year over year, although both were lower than May's revised-lower rate.

Some articles also mention negative reactions to M&A news and some earnings reports as leading to the pullback in European indices. Germany's Adidas-Salomon AG said that it will buy U.S. rival Reebok, with Adidas-Salomon dropping. Altana fared better after its announcement that it would acquire specialty chemicals company Eckart Gmbh, with Altana soaring after the announcement. Altana will spin off two divisions after the acquisition. CSFB fell after its earnings report revealed that the drop in net profit was more than expected. Ireland's Allied Irish Banks PLC also dropped, although it raised earnings guidance for the year as part of its report. British bank HBOS didn't see much reaction after its earnings report, although it inched a little higher. German car manufacturer BMW's report was greeted with a sell-off after it reported falling pre-tax profit and net profit. Sales were between the expected range. BMW expects to see flat earnings for the year. Miner Rio-Tinto beat expectations and rose in early European trading. Satellite broadcaster BSkyB dropped after its report.

As of 6:34 EST, the FTSE 100 was lower by 11.70 points or 0.22%, at 5,315.80. The CAC 40 was lower by 15.87 points or 0.35%, at 4,487.46. The DAX was lower by 14.66 points or 0.30%, at 4,918.21.

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