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Jeff Bailey : 9/21/2005 12:41:24 AM

October Unleaded (hu05v) $2.07 +4.54% ... alert here and retraces 50% of its Katrina settlement high ($2.36) to recent settlement low of $1.78.

OI Technical Staff : 9/20/2005 9:59:59 PM

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Jeff Bailey : 9/20/2005 5:21:55 PM

Pivot Matrix for tomorrow at this Link

Jeff Bailey : 9/20/2005 4:52:23 PM

Closing U.S. Market Watch found at this Link

August 9 Closing U.S. Market Watch at this Link ...

June 30 Closing U.S. Market Watch at this Link

Jeff Bailey : 9/20/2005 4:38:45 PM

Closing Internals found at this Link

Jeff Bailey : 9/20/2005 4:14:16 PM

Current OPEN MM Profiles found at this Link ... Today's Activity ... Swing trade stopped early this morning in the 1/2 position short in the QQQQ at $33.25 ($-0.22, or -0.56%).

Swing traded long 1/2 bullish in shares of Valero Energy (VLO) at $109.45. Stop is at $107.00, targeting $113.50.

Linda Piazza : 9/20/2005 3:57:40 PM

The OEX may well end the day below the 200-sma and below that 568-ish resistance, but may still be in a bear-flag climb into that resistance.

Jeff Bailey : 9/20/2005 3:51:54 PM

October Crude Oil (cl05v) settled down $1.16, or -1.72% at $66.23.

October Unleaded (hu05v) settled down $-0.066, or -3.24% at $1.9766.

October Heating Oil (ho05v) settled down $-0.027, or -1.33% at $2.0113.

The night before Katrina hit land (08/26/05), the above contracts settled $66.13, $1.8534 and $1.8712.

Linda Piazza : 9/20/2005 3:51:50 PM

The RLX fell sharply this afternoon, too, after not quite rising high enough to retest its 200-sma and -ema's earlier.

Jonathan Levinson : 9/20/2005 3:44:02 PM

No improvement for volume breadth here, -3.35:1 on the NYSE and -1.28:1 on the Nasdaq, QQQQ's bounce developed into a short cycle upphase that is just approaching overbought territory, a quick move in the high volume here. The 30 and 60 min channels continue to point south, with the 72 SMA down to 39.05. 5-day 100 tick view at this Link

Linda Piazza : 9/20/2005 3:44:26 PM

The OEX is back to the 200-sma. Bears need to make a decision as to whether they'll hold overnight or not. As I said earlier, they need to assess their willingness to weather a bounce up to 568, the bottom of the former triangle, at least, although I'm of course not certain the OEX will get that high. As I also noted earlier, having taken partial profit, at least, will help ease the decision. Next Keltner resistance is at 567.87-568.34, near that triangle's former support, as is the 38.2% retracement of the decline off the last 15-minute high from earlier today. Depending on account characteristics and whether partial profit has been taken, and the amount of cushion on the position, holding overnight might be an okay decision, but I wouldn't do it unless I'd taken at least partial profit. Notice, however, that the OEX is nearer the bottom than the top of the descending regression channel in which it's been falling away from the September high.

Linda Piazza : 9/20/2005 3:28:40 PM

The advdec line tries to steady. The OEX bounces, not quite up to the 200-sma yet. This is a possible rollover point, of course, as is the 568 level, but bears need to know if they're willing to weather a bounce up to 568 or so before they know if the bounce is going to continue higher or not. So far, they're safe. If bears have taken partial profits, they've got more leeway and more comfort making decisions, especially as to whether they want to hold overnight.

Jonathan Levinson : 9/20/2005 3:26:40 PM

QQQQ tests lower declining support on an expanding wedge. Wish I had caught this this morning when QQQQ was testing 39.54. Another test of the low around 38.84 would be a potential long entry with a tight stop just below 38.80. Link

Linda Piazza : 9/20/2005 3:19:55 PM

The OEX's 15-minute Keltner support is at 565.36, with that line previously hit, and next resistance is currently at 567.05 on a 15-minute closing basis. This is a time for bears to protect profits, but not necessarily yet a time for a bullish play, even for scalpers. I'm expecting a bounce back to retest the 200-sma, but not sure whether that will happen before today's close, and any who went long automatically at a test of the 200-sma are already underwater and may be quite willing to sell on every approach to that average. Still, I wouldn't be surprised to see a bounce back to the 200-sma or even up toward 568. Just as I wouldn't be surprised to see a continued downturn this afternoon. Bears need to be prepared for either contingency and know what they'll do in either case.

Jonathan Levinson : 9/20/2005 3:19:15 PM

So much for the right shoulder- I didn't have time to get the entry posted.

Jonathan Levinson : 9/20/2005 3:18:14 PM

QQQQ holds at 38.90, trying to build a higher low in what would effectively be a right shoulder of a sloping reverse h&s here if 38.88 holds. Bulls need a break back above the 72 SMA, way up at 39.16, to confirm anything more than a corrective bounce/noise at the lows. Volume has dropped sharply on this move off the lows, and I have little confidence that it will hold. Volume breadth is down to -3.77:1 for the NYSE, -1.29:1 for the Nasdaq.

Jeff Bailey : 9/20/2005 3:16:44 PM

03:00 Internals found at this Link

Linda Piazza : 9/20/2005 3:11:56 PM

On any bounce, remember the OEX's 200-sma at 566.86 and the rising trendline that defined bottom support for the OEX's triangle, forming since Thursday, with that support at just over 568. A 19.1% retracement of the current drop is just under the 200-sma and the 38.2% retracement is near the triangle's former support, so those levels make sense from a Fib standpoint, too, for a retest.

Linda Piazza : 9/20/2005 3:06:43 PM

Bears, constinue to protect profits, as the OEX reaches another downside target, at 565.38 on the 15-minute Keltner channel. A bounce up to retest the 200-sma should be expected at some time, although I'm not certain whether that will happen today or not.

Jeff Bailey : 9/20/2005 3:04:29 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 9/20/2005 3:04:28 PM

I've had a long entry dialed up for the past 4 minutes, and I can't bring myself to trigger it. The channel breaches and other indications don't feel at all like fadeable moves- feels like impulsive selling instead.

Jeff Bailey : 9/20/2005 3:02:27 PM

Sell Program Premium ... DIA $104.79, SPX 1,223, QQQQ $38.93

Linda Piazza : 9/20/2005 3:00:34 PM

The OEX now has a 565.57 downside target on its 15-minute chart, pending continued 15-minute closes beneath a keltner line currently at 565.58, but it's hit its 30-minute target and so has the advdec line. The OEX has also, of course, hit its 200-sma, more importantly, as well as its 100-sma. This is not necessarily a time to reverse to a long position, but it's definitely a time to protect bearish profits.

Jeff Bailey : 9/20/2005 2:58:06 PM

Sell Program Premium ... DIA $104.85, SPX 1,223.45, QQQQ $38.99.

Jeff Bailey : 9/20/2005 2:56:21 PM

Buy Program Premium DIA $104.92, SPX 1,224.33, QQQQ $39.02

Linda Piazza : 9/20/2005 2:54:19 PM

Protect profits, OEX bears.

Linda Piazza : 9/20/2005 2:53:36 PM

OEX bears now want the OEX to produce a 15-minute close beneath the Keltner line currently at 568.67, to keep alive the downside target of 565.65, which I see it's heading toward as I type. Remember that 200-sma just below, however. Lots of potential support, which is the reason that I suggested that those who might have entered a new bearish position on the retest of the 15-minute 100/130-ema's might consider taking at least partial profit, in my 2:48:46 post. The advdec line is also fast approaching potential support.

Jeff Bailey : 9/20/2005 2:52:52 PM

Buy Program Premium .... DIA $105.02, SPX 1,225.61, QQQQ $39.05

Jonathan Levinson : 9/20/2005 2:52:45 PM

Session lows across the board.

Jonathan Levinson : 9/20/2005 2:51:41 PM

Volume breadth comes down to neutral for QQQQ at +1.03:1, the NYSE reading -2.43:1.

Jonathan Levinson : 9/20/2005 2:50:56 PM

The Qs are now below 30 and 60 min channel support, verging on a "crash" in these longer intraday cycles. More likely is some kind of corrective bounce up but price is heavy and voule picking up sharply.

Jeff Bailey : 9/20/2005 2:50:17 PM

TRIN 1.49 and spikes from 1.22

Jeff Bailey : 9/20/2005 2:49:39 PM

It's a dinger too!

Jeff Bailey : 9/20/2005 2:49:12 PM

Sell Program Premium ... DIA 105.00, SPX 1,226.03, QQQQ $39.13

Linda Piazza : 9/20/2005 2:48:45 PM

The OEX has dropped below the triangle's support, but just barely. It's fast approaching the 72-ema and 200-sma, however, and any who entered bearish positions on a retest of the 15-minute 100/130-ema's might consider taking partial profit now.

Jonathan Levinson : 9/20/2005 2:47:53 PM

Session lows across the board, NQ futures going red with QQQQ up .04, the last green amongst the equitty indices.

Linda Piazza : 9/20/2005 2:45:52 PM

Remember that H&S that was confirmed on the OEX on 9/14, with the OEX then consolidating below the neckline before leaping above it Friday? The OeX is finding resistance now at that former neckline, at about 569.90. The 15-minute 100/130-ema's are above at 570.68 and 570.59, and they are still providing resistance, too. The actual bottom support of the triangle that's been forming since Thursday is just above 568, at about 568.10, so any in bearish positions need to be aware of that potential support, too, should the OEX either keep sliding down along Keltner support currently at 568.99 but moving lower, or if it should even violate that support on a 15-minute close. The advdec line suggests that more downside is still possible. Although I didn't advocate a new bearish entry on a failed test of the 15-minute 100/130-ema's, any who attempted it are doing okay now, but should be aware of this current close Keltner support. Watch carefull as the advdec line approaches -900 issues, too, as that could be a bounce point for the advdec line.

Jeff Bailey : 9/20/2005 2:45:12 PM

December Fed Fund futures (ff05z) 96.00

Jeff Bailey : 9/20/2005 2:44:32 PM

Sell Program Premium ... DIA $105.23, SPX 1,228.66, QQQQ $39.28

Jonathan Levinson : 9/20/2005 2:42:39 PM

IRX now up 9.5 bps at 3.535%, TNX down .7 bps at 4.24%, still more flattening.

Jonathan Levinson : 9/20/2005 2:41:40 PM

QQQQ update at this Link , retreating from 39.40. The short cycle upphase is pretty weak so far, still mostly just chop at the pre-FOMC levels.

Jonathan Levinson : 9/20/2005 2:39:14 PM

Session high for GOOG here at 311.30, +7.51.

Jonathan Levinson : 9/20/2005 2:36:37 PM

Volume breadth -1.28:1 for the NYSE, +2.25:1 for the Nasdaq as QQQQ returns to R1 at 39.40: Link

Linda Piazza : 9/20/2005 2:34:27 PM

OEX bears or perhaps even want-to-be bears would like to see the OEX stop its advance at the 15-minute 100/130-ema's at 570.69 and 570.60 on 15-minute closes. I'm not advocating a new bearish entry, as the OEX is again squarely in the middle of its triangle, forming since last Thursday. If you have profit today, sit back and enjoy it and be careful about new positions.

Jonathan Levinson : 9/20/2005 2:32:56 PM

Crude oil finished -1.35 at 66.15, natgas -.195 at 13.07. Gold is -1.8 here at 468.60, silver -.032 at 7.369.

Jonathan Levinson : 9/20/2005 2:31:19 PM

REDMOND, Wash., Sept 20, 2005 /PRNewswire-FirstCall via COMTEX/ -- In order to drive greater agility in the execution of its software and services strategy, Microsoft Corp. today announced a realignment of the company into three newly formed divisions, each of which will be led by its own president. The Microsoft Platform Products & Services Division will be led by Kevin Johnson and Jim Allchin as co-presidents; Jeff Raikes has been named president of the Microsoft Business Division; and Robbie Bach has been named as president of Microsoft Entertainment & Devices Division. In addition, the company said Ray Ozzie will expand his role as chief technical officer by assuming responsibility for helping drive its software-based services strategy and execution across all three divisions.

MSFT -.03 at 25.97, 6 cents off the day low.

Jeff Bailey : 9/20/2005 2:27:55 PM

BIX.X 347.61 -0.06% .... session low here.

Curve flattens with 5-year up 6.6 bp, 30-year up 2.7 bp.

Linda Piazza : 9/20/2005 2:27:03 PM

If you're in a bearish play after my 10:51:18 post and didn't take profit pre-FOMC, now is a good time to take at least partial profit and ratchet down your stops. Both the OEX and the advdec line are at points that could prompt bounces, but aren't guaranteed to do so. Protect profits and don't let it turn into a loss.

Jeff Bailey : 9/20/2005 2:25:59 PM

Sell Program Premium ... DIA $105.31, SPX 1,229.44, QQQQ $39.29

Jonathan Levinson : 9/20/2005 2:25:59 PM

Not the most aggressive stance re: inflation:

Higher energy and other costs have the potential to add to inflation pressures. However, core inflation has been relatively low in recent months and longer-term inflation expectations remain contained.

This is much less hawkish than Greenspan's Jackson Hole comments.

Jeff Bailey : 9/20/2005 2:24:18 PM

Buy Program Premium ... DIA $105.37, SPX 1,230.41, QQQQ $39.34

Jonathan Levinson : 9/20/2005 2:22:53 PM

Crude oil -1.075 at 66.425 here, natgas -.195 at 13.07.

Linda Piazza : 9/20/2005 2:22:29 PM

The bottom of the OEX's triangle, forming since Thursday, is not at about 568.10, but the OEX quickly approaches the bottom of that Keltner channel that usually contains prices, with that currently at 569.21 and the OEX just a few cents above it. There could, of course, be a breakdown, with a new Keltner target of 566, but bears need to be protective of profits from this point on.

Jonathan Levinson : 9/20/2005 2:22:23 PM

Ten year note yields +2.4 bps at 4.271%, IRX +8.7 bps at 3.527%.

Jonathan Levinson : 9/20/2005 2:21:58 PM

QQQQ breaking the previous range low here, testing 39.25 support. Link

Jeff Bailey : 9/20/2005 2:21:32 PM

It's a "dinger"

Jeff Bailey : 9/20/2005 2:21:11 PM

Sell Program Premium ... DIA $105.43, SPX 1,231, QQQQ $39.29

Jonathan Levinson : 9/20/2005 2:20:41 PM

Very muted response so far for QQQQ, less than 15 cents' range on the FOMC gyrations here.

Jeff Bailey : 9/20/2005 2:19:29 PM

Buy Program Premium .... DIA $105.63, SPX 1,232.11, QQQQ $39.41

Linda Piazza : 9/20/2005 2:19:20 PM

OEX Keltner support below at 569.34, and that's a place where short-term bears might take partial profits, if they haven't already done so. Right now, though, the OEX is bouncing right back up to the 15-minute 100/130-ema's to retest them, so that the final reaction isn't yet sorted out.

Jonathan Levinson : 9/20/2005 2:19:20 PM

Headlines:

FOMC HIKES RATES BY QUARTER POINT TO 3.75%

FOMC: KATRINA WILL CAUSE SHORT-TERM, NOT LONG-TERM DISTRESS

FOMC: RATES CAN STILL BE RAISED AT 'MEASURED' PACE

FOMC SAYS RATES STILL 'ACCOMMODATIVE'

FOMC VOTE NOT UNANIMOUS, GOV. OLSON DISSENTS

FOMC: KATRINA MAY ADD TO ENERGY PRICE VOLATILITY

FOMC: HIGHER ENERGY COSTS MAY ADD TO INFLATION THREAT

Jonathan Levinson : 9/20/2005 2:18:35 PM

Full statement at this Link

Jonathan Levinson : 9/20/2005 2:18:19 PM

WASHINGTON (MarketWatch) - The Federal Open Market Committee increased its target for overnight interest rates by a quarter percentage point to 3.75% Tuesday. This is the eleventh straight meeting with a quarter-point rate hike. The Fed funds rate is now at its highest level since June 2001. The increase in the federal funds rate was expected by traders and economists on Wall Street. There was one dissent. Fed governor Mark Olson preferred that the Fed stand pat. The committee once again concluded its monetary policy stance remains accommodative and that this "accommodation" can be removed "at a pace that is likely to be measured."

Linda Piazza : 9/20/2005 2:18:14 PM

Initial reaction is negative, but that's not always the final reaction. OEX bears that held on to all or part of their position now do not want to see a quick reversal.

Jeff Bailey : 9/20/2005 2:17:59 PM

Sell Program Premium ... DIA $105.53, SPX 1,231.74, QQQQ $39.32

Jonathan Levinson : 9/20/2005 2:17:26 PM

.25 bp hike.

Jeff Bailey : 9/20/2005 2:17:03 PM

02:00 Internals found at this Link

Jonathan Levinson : 9/20/2005 2:17:03 PM

Awaiting the announcement.

Linda Piazza : 9/20/2005 2:13:30 PM

The OEX did bounce as expected from the 15-minute 100/130-ema's. It's facing first Keltner resistance at 571.27 on 15-minute closes, but as I said earlier, all bets are off now, until after the announcement and we see where the dust settles.

Jonathan Levinson : 9/20/2005 2:05:14 PM

A short cycle bounce is due here. Bulls need a break above the 72 SMA at 39.42 for confirmation, while bears need a break below 39.25 to set it trending in oversold.

Jeff Bailey : 9/20/2005 2:04:32 PM

02:00 Market Watch found at this Link

Jonathan Levinson : 9/20/2005 2:02:08 PM

Keene, the trick to speed reading is not "pronouncing" the words in your head as your eyes move over the words. It feels like you haven't read it, but your mind retains most what the eyes pass over.

Jonathan Levinson : 9/20/2005 2:00:06 PM

Volume breadth is mixed, with the NYSE at -1.12:1 and the Nasdaq down to +2.02:1 here.

Linda Piazza : 9/20/2005 1:59:22 PM

The advdec line tests next support as the OEX tests support, too, at the 15-minute 100/130-ema's. The OEX's mid-channel level on the Keltner channels is at 570.64 on 15-minute closes, so roughly analogous with the 100/130-ema's. The OEX also approaches support on the 30-minute chart, from 570.02-570.73. That support looks stronger than nearby resistance on the 30-minute chart, but the post-FOMC reaction could quickly change that, just as it could quickly send the OEX higher, punching through resistance. From this time on, until we see the reaction and let things settle down, all bets are off as to chart characteristics and what they show.

Jane Fox : 9/20/2005 1:56:49 PM

Dateline WSJ Rita strengthened into a growing hurricane Tuesday as it lashed the Florida Keys with flooding rain and strong wind, threatening the island chain with a storm surge and sparking fears the storm could eventually bring new misery to the Gulf Coast.

The National Hurricane Center said Hurricane Rita has strengthened to a Category 2 storm with top sustained winds of 100 mph.

Thousands of residents and tourists had fled the Keys in advance of Rita, which forecasters said could dump up to eight inches of rain on parts of the low-lying island chain. Rita could continue gaining strength as it crosses the warm Gulf of Mexico for a weekend landfall, most likely in Texas although Louisiana or northern Mexico could end up in the path of what could become a major hurricane.

Linda Piazza : 9/20/2005 1:52:02 PM

The SOX is slipping back below the 15-minute 100/130-ema's, but it's not slipping too far yet, just as it couldn't move too far above them this morning. The SOX's 30- and 50-sma's are below, at 470.02 and 470.38, with the SOX currently at 472.48.

Jeff Bailey : 9/20/2005 1:52:31 PM

Swing trade long alert for 1/2 bullish position in shares of Valero Energy (VLO) $109.45 here, stop $107, target $113.50. (options just seem way too expensive). Unleaded has made a new session high.

Disclosure ... I currently hold a bullish position in VLO. I was short yesterday too.

Linda Piazza : 9/20/2005 1:50:17 PM

OEX testing the 15-minute 100/130-ema's now, at 570.71 and 570.61. In my 1:42 post, I was mistakening looking at the 30-minute versions. Now is the time to make up your mind, bears, as to whether you'll take partial or complete profit or wait out the FOMC decision.

Jonathan Levinson : 9/20/2005 1:48:07 PM

QQQQ's 30 min cycle has rolled over, while the 60 min continues to lag as it did earlier this morning, currently point north as the channel begins to stall in its rise. 39.30 is the current interstection of those two key channels, and represents the top of confluence support to 39.25. Complicating this cautiously bearish picture is the bottomy short cycle, which is showing slight bullish divergences as the indicators gather in oversold territory. Link

Linda Piazza : 9/20/2005 1:42:40 PM

OEX bears would now like a move below the 15-minute 100/130-ema's at 570.24 and 569.89, respectively, but watch for a potential steadying or bounce from that level. Those in a bearish play need to consider whether they'll take profits--partial or complete--as this support is tested pre-FOMC. There's no guarantee that anything to do with pre-FOMC trading will follow through post-FOMC release. Bears would like to see the advdec line soundly below +500 and the OEX below those 15-minute averages soon, but I'm not sure that will happen pre-FOMC announcement. As I said a few minutes ago, the OEX's current location near the center of that triangle that's been forming since Thursday allows for a lot of volatility either direction without the triangle's support or resistance being broken after the FOMC announcement. There's no right or wrong decision about holding onto a bearish play entered earlier this morning, as that depends on your trading style, your entry, the number of contracts you entered and your account size, for example.

Jonathan Levinson : 9/20/2005 1:39:12 PM

Foreign central banks took a very small 876K of the 8B in 4-week T-bills auctioned today. The bid to cover was a respectable 3.16, with the bills selling at a high-rate of 3.21% yielding 3.263%. Currently, 13-week bill rates are up a whopping 7.5 bps at 3.515%, while the TNX is up 1.9 bps at 4.266%.

Jeff Bailey : 9/20/2005 1:37:07 PM

Huskey Energy (TSE:HSE) $62.20 +0.56% ... comes back to morning highs.

Valero (VLO) $109.35 -1.72% ... comes to mid-point of intra-day range.

Jonathan Levinson : 9/20/2005 1:31:18 PM

Crude oil -1.35 here at 66.15, off a low of 65.05, natgas -.265 at 13.005, off a low of 12.56.

Linda Piazza : 9/20/2005 1:28:00 PM

Often I see the OEX jammed up underneath next strong resistance or pushed down to next strong support into the FOMC meeting, ready to go either direction. As maddening as that can be at times, it looks now as if the OEX will be maneuvered into the middle of that triangle that's been forming since Thursday, barring a big move before 2:15. The trouble with that is that gives traders no close stops by which they can judge if their guesses are right and allows for a lot of volatility after the announcement without that triangle being violated. The parameters are now at just under 573 on the topside and about 568.10 on the downside, but they'll narrow a little more before the announcement.

Jonathan Levinson : 9/20/2005 1:24:58 PM

Jeff, volume-wise, QQQQ's put to call ratio looks quite high at the 38 and 39 strikes, which should be supportive, particulary with the QQV negative today- looks like institutional selling of OTM puts. Open interest is also much higher on the put side, which should also be supportive.

Jeff Bailey : 9/20/2005 1:23:30 PM

01:00 Internals found at this Link

Jonathan Levinson : 9/20/2005 1:23:18 PM

A big sell program here has seen almost 3M QQQQ shares traded on a negative tick, drilling price down to 39.30 QQQQ and bouncing slightly as I type. Link

Linda Piazza : 9/20/2005 1:23:27 PM

The OEX's 15-minute 100/130-ema's, which are important in the OEX's trading pattern, are at 570.71 and 570.61, respectively. Any who might have tried a bearish play after my 10:51:18 post need to consider whether they'll go ahead and exit the position if the OEX should dip there pre-FOMC or hang on. The OEX was in the 572.35-572.52 range the minute after that post was uploaded, so perhaps you've been able to recoup commissions at least, if not profit. OEX at 571.08 as I type, approaching that potential support. Make your decision soon.

Jeff Bailey : 9/20/2005 1:11:11 PM

VXN.X 14.35 -2.31%

Jeff Bailey : 9/20/2005 1:10:57 PM

Jonathan ... anything strike you as suspicious in the QQQQ option chain today?

Linda Piazza : 9/20/2005 1:09:41 PM

The OEX continues to find resistance on 15-minute closes at a Keltner line currently at 571.68, with further resistance at 572.13 and 572.65. Support continues to try to firm, too, though, with that support from 570.63-571.23. This sandwiching between support and resistance is a familiar sight pre-FOMC, and it's possible that the OEX will trade sideways over the next hour. The advdec line, though, has reached a bounce-or-drop point, and its trajectory should be watched closely.

Jonathan Levinson : 9/20/2005 1:05:46 PM

QQQQ's gone net nowhere through a wavelet upphase here, the short cycle Macd still buried in oversold. Volume has dropped off, and I'm not expecting much in the way of movement here. Link

Jeff Bailey : 9/20/2005 1:04:30 PM

01:00 Market Watch found at this Link

Linda Piazza : 9/20/2005 12:57:07 PM

The TRAN has also been climbing all day. It's also been dealing with Keltner resistance all day, at a channel level that usually stops it. It's been nudging that Keltner resistance higher, even if it hasn't been quite able to break convincingly through it, with that Keltner resistance currently at 3623.69 on 15-minute closes and with the TRAN currently at 3625.42. The 200-sma is about 13 points above. (QCharts is leaving out a daily bar, skewing the average somewhat.) The TRAN is still just churning around in its most recent consolidation pattern, not breaking out either direction. Watch the 72-ema at 3654 for an upside break, but the most recent pattern has included a downturn from resistance offered by either the 200-sma or that 72-ema.

Jeff Bailey : 9/20/2005 12:55:04 PM

13-week Treasury YIELD ($IRX.X) up 7.5 bp at 3.515%.

Jeff Bailey : 9/20/2005 12:53:26 PM

December Fed Fund Futures (ff05z) still quiet and unchanged at 96.05.

Jeff Bailey : 9/20/2005 12:48:45 PM

Current OPEN MM Profiles found at this Link ... Earlier this morning we were stopped out of the 1/2 position short in the QQQQ from $39.03 at $39.25 ($-0.22, or -0.56%).

Linda Piazza : 9/20/2005 12:47:24 PM

Potential bounce point or stronger rollover point being approached by the advdec line.

Linda Piazza : 9/20/2005 12:43:55 PM

The BIX is jammed right underneath 350, and right underneath the 61.8% retracement of yesterday's steep fall. At 349.90 as I type, it's just slightly below the 350.00 HOD.

Jonathan Levinson : 9/20/2005 12:39:21 PM

Volume breadth is -1.05:1 on the NYSE, +2.93:1 on the Nasdaq. QQQQ's short cycle indicators are no longer bearish, actually neutral-bullish here: Link

Linda Piazza : 9/20/2005 12:34:43 PM

The last OEX 15-minute close remained below the Keltner line currently at 571.77, but support is trying to firm from 570.60-571.26, too, as the advdec line approaches another potential support level. OEX bears want continued 15-minute closes beneath that Keltner level or below 572.28 or 572.67 if that first resistance doesn't hold.

Linda Piazza : 9/20/2005 12:30:55 PM

SOX still holding at the 15-minute 100/130-ema's at 472.51 and 473.19, respective. Still can't move much above them, but isn't falling below them.

Linda Piazza : 9/20/2005 12:23:01 PM

OEX attempting to stabilize and bounce from the 15-minute 21-ema at 571.35. If it does bounce, bears want a lower or equal high, with bearish divergence. The advdec line is sinking into potential support, too, so either a bounce or else a steeper decline could be in the works, depending on how it handles the +600 area. Advdec line at +897 as I type.

Linda Piazza : 9/20/2005 12:15:57 PM

If you're an OEX trader who tried a bearish OEX play after my 10:51:18 post, then you should be aware of potential support approaching from 570.57-571.22. If your intention was just to scalp a point or two, you might consider enacting your plans as that support is approached. If your intention was to hang in, then you would like any bounces to stay beneath 571.79 on 15-minute closes, or at least beneath 572.34-572.78.

Jeff Bailey : 9/20/2005 12:13:54 PM

12:00 Internals found at this Link

Jonathan Levinson : 9/20/2005 12:11:28 PM

Back. QQQQ's volume has been weak, but heavier than I recall from recent FOMC days. Price is breaking down only minimally considering how overbought the short cycle indicators had been. A weak downphase here portends bullishly for the next upphase, but I'm reserving judgment as we approach the 2:15 announcement. Link

Linda Piazza : 9/20/2005 12:06:49 PM

The BIX is still testing the previous HOD, with that HOD at 349.91 and the BIX at 349.85. The BIX needs to fall before we can expect too steep of a fall from the OEX.

Jeff Bailey : 9/20/2005 12:03:58 PM

12:00 Market Watch at this Link

Linda Piazza : 9/20/2005 12:03:54 PM

The SOX still holds above the 15-minute 100/130-ema's at 472.49 and 473.19, respectively. It's not making much progress above them, though, with the SOX currently at 473.72.

Linda Piazza : 9/20/2005 12:02:58 PM

TRIN is trying to climb toward the HOD again, too.

Linda Piazza : 9/20/2005 12:02:07 PM

OEX bears didn't quite get their wish, with a 15-minute close beneath a Keltner line currently at 571.97. That support held into the just-completed 15-minute period's close. Support is there, currently being tested again, with resistance at 572.67 on 15-minute closes. The advdec line sinks into possible support, at 642-940.

Tab Gilles : 9/20/2005 11:56:11 AM

Eaton Vance Limitied Duration Fund (EVV) Link

Linda Piazza : 9/20/2005 11:52:31 AM

Advdec line dropping below first support, but the pullback still isn't precipitous and next strong support approaches between +560 to +920. Advdec line at 1087 as I type. The OEX isn't exactly pulling back precipitously, either. So current OEX bulls can take cheer in that fact, and current OEX bears can take cheer in the fact that the Keltner resistance currently at 572.67 on 15-minute closes continues to hold. There's still no swaying of the probable outcome toward one side or another. OEX bears would like to see 15-minute closes beneath the keltner line currently at 571.98 as a first step.

Linda Piazza : 9/20/2005 11:48:51 AM

Like Jane, I watch charts to make up my mind about what's going to happen, but I do remember once, long ago, before I knew any better, ignoring a FOMC meeting and its implications. I was caught unaware, relying only on charts. And, so, I limit risk when trading on FOMC days, if I trade at all. I've been trying to decide what I expect to come out of this meeting today, though, and it seems to me that any outcome has the possibility of being disappointing. If rates are raised in the face of the challenges facing our nation post-Katrina, some will likely be disappointed. If the rates aren't, some are likely to be worried about what the Fed sees.

It makes little difference what I think, though. Look at what's happened with the DAX, with post-election uncertainty slated to continue at least until early October, when Dresden (I believe?) votes, and perhaps after that. The DAX acts as if it's all good news.

Linda Piazza : 9/20/2005 11:44:31 AM

Advdec line again testing support, now at about 1215, with the advdec line at 1242. Bears want it to sink and the OEX to sink with it. Bulls want it to find support here, as it's done all day. The OEX continues to find resistance on 15-minute closes at a Keltner line currently at 572.65, with the OEX currently at 572.48, but it's not giving up the challenge of that resistance, either. Something's got to give, and I'm not sure yet which it will be.

Tab Gilles : 9/20/2005 11:36:36 AM

Nasdaq100 ($NDX) As stated on previous MM 9/15 11:34PM, 9/16 5:39 PM & 9/20 12:57 AM. Even though I exited the long position (UOPIX) I was hesitant going short with the $NASI signaling. Basing this on the Option expirations and FOMC meeting and the $NDX chart mixed signals. Again on sidelines watching. Link

Linda Piazza : 9/20/2005 11:35:34 AM

The OEX still faces resistance it can't seem to break while the advdec line still tests support that seems to hold. A mixed picture here. One is going to have to give. Wouldn't be surprised to see another push higher, but watch for a quick reversal if that happens.

Linda Piazza : 9/20/2005 11:33:03 AM

Overnight, we contacted a lot of friends and relatives in the Port Arthur area, where both my husband and I grew up and where his relatives still live. They're all refinery workers, with Port Arthur being a refinery town, so much so that in 2002, the Sierra Club named it as leading the nation in pollution from manufacturing industries. They're the major employer in the area, with some changing hands over the years, so that I'm not sure the list is still current, but with a 2003 list including Premcor Refining, BASF Corporation, Atofina Petrochemicals, Chevron Phillips Chemical Corp., Hunstman Petrochemical Corp., and Motiva Enterprises as being among the chemical companies operating in the area. I had thought from my childhood days that there were only five refineries in the area, so I'm not certain of the list. These do not include the Houston-area refineries such as the one in Deer Park. Port Arthur, like inner city New Orleans, suffers from some of the same socio-economic difficulties in evacuating large numbers of people. It's low-lying, although not in a bowl as is New Orleans. Within the last few years, my husband's family once tried to evacuate the area, but couldn't make it out because of traffic concerns and had to turn back. I wouldn't imagine that the devastation would rival that of New Orleans if a hurricane should hit there, but it certainly wouldn't be a good thing, either, for the citizens in that area, or for our nation's refining capacity.

Linda Piazza : 9/20/2005 11:17:29 AM

Another OEX close beneath the Keltner line currently at 572.63, important on 15-minute closes, but the OEX is still right there, nudging that resistance higher cent by cent, toward the 573-ish resistance offered by the narrowing triangle forming since Thursday. The OEX is at 572.55, and OEX bears want to see the OEX exhaust itself battering against that resistance and fall back, while OEX bulls want a strong break above it. The advdec line is not currently falling back enough to give bears a good feeling.

Jeff Bailey : 9/20/2005 11:16:56 AM

11:00 Internals found at this Link

Linda Piazza : 9/20/2005 11:13:22 AM

It's once again a BIX move higher that's helping prop up the OEX and send it higher, too. The BIX is about to test the 21-sma that had stopped all advances since 7/27, with Friday's push through it and close above it the first time since 7/27. Yesterday, the BIX dropped right back below it again, of course. That average is now at 350.14, with the BIX now at 349.76. The BIX has now retraced more than 50% of yesterday's decline, testing the 61.8% retracement, at 350.00.

Linda Piazza : 9/20/2005 11:10:06 AM

SOX still testing those 15-minute 100/130-ema's, not able to move much after breaking above them, but not falling back below them, either. Still watching.

Linda Piazza : 9/20/2005 11:09:01 AM

OEX still testing Keltner resistance currently at 572.61 on 15-minute closes, nudging that resistance higher, and toward the 573-ish top of the triangle forming since Thursday. So far, the OEX produces 15-minute closes beneath that Keltner line, unable to pop through it, but it could just nudge it where it wants to go. Even stronger resistance at 573.49 on 30-minute closes, which would constitute a test of Friday's 573.44 high.

Jeff Bailey : 9/20/2005 11:06:47 AM

11:00 Market Watch found at this Link

Linda Piazza : 9/20/2005 11:06:25 AM

The advdec line now again tests first potential support at +1190, with the advdec line at 1335 as I type, all this on QCharts. Bears want the advdec line to fall steeply through that potential support and bulls want a bounce.

Jeff Bailey : 9/20/2005 11:03:23 AM

Valero (VLO) $108.93 -2.07% ... getting hit back lower today. Some cite Rita's slight change in course for weakness in energy complex today.

OSX.X 175.63 -0.75% Link ... was developing bearish divergence from MACD, but sector bears jittery as price mattered most.

Linda Piazza : 9/20/2005 11:01:08 AM

The OEX had a little running gap this morning on its 15-minute chart and has now dropped to test that gap. The pullback isn't major at all and is in a corrective-type form . . . and the OEX just inched up a little again as I typed, although not above the previous HOD. As this 15-minute period draws to a close, it's still finding resistance at the Keltner channel line that usually contains upside moves, with that line currently at 572.58 on 15-minute closes. There are of course breaches of this line, but they're usually eventually turned back before reaching the Keltner target that's set by such breakouts. The 30-minute channel's resistance is even stronger, and it's at 573.45 on 30-minute closes.

Jonathan Levinson : 9/20/2005 10:58:26 AM

Closeup view of this range which may be a descending/bearish triangle for QQQQ. A break below 39.45 with a rise in volume should be a good short entry: Link . I have to leave for an appointment, but should be back by noon at the latest.

Jonathan Levinson : 9/20/2005 10:53:20 AM

Still no resolution to the range, but the pattern is printing lower highs as the trending short cycle weakens and ticks lower: Link

Jeff Bailey : 9/20/2005 10:56:31 AM

U.S. Steel (X) $42.76 -5.50% ... after the company warned that Q3 earnings would fall below prior forecast, citing a "significant decline" in income for its flat-rolled and European segments.

The company has not given specific figures. Current consensus was for the company to earn $1.44 per share on revenue of $3.38 billion.

The steel-maker did say it still plans to fire up its Gary Works blast furnace and its European U.S. Steel Kosice mill is scheduled to return to production in mid-October.

"Order rates have strengthened both domestically and in Europe and are expected to support higher operating levels when the two blast furnace projects are completed and the furnaces are returned to production," the company said. "Tubular markets and operations remain strong."

Linda Piazza : 9/20/2005 10:51:17 AM

The advdec line is again headed toward a test of first potential support, at about 1170, with the advdec line now at 1339. OEX bulls want to see the advdec line hold above that support. OEX bears want to see it drop. The OEX has approached the top of the triangle that's been forming since last Thursday and has hit the Keltner resistance that usually contains it, but the advdec line hasn't yet dropped far enough to signal that it might be ready to drop and bring equities down with it. If you're the kind of trader who likes to hit certain levels with a trial play, then this is one level to test a bearish OEX play, with a stop a quick account-appropriate amount above that triangle's resistance at about 573.05 now, but there's still the possibility for a push higher on the advdec line and the OEX, too. Some charts suggest that as a probability, while the OEX's 15-minute Keltner resistance continues to hold on 15-minute closes (pending the current close).

Linda Piazza : 9/20/2005 10:46:23 AM

DAX just hit a new HOD, but still is within an equal-ish double-top level. If it keeps climbing, it will hit the top of the gap down from Monday, with that at Friday's close at 4,986.50. Extreme political uncertainty doesn't appear to matter, either, as the DAX charges up toward 5,000 again.

Linda Piazza : 9/20/2005 10:42:34 AM

The SOX is retesting those 15-minute 100/130-ema's, but it hasn't fallen back below them again. They're at 472.35 and 473.16, respectively, with the SOX at 473.40 and with this being the first time since 9/15 that the SOX has closed a 15-minute period above these averages. SOX bulls now don't want a reversal back below those averages.

Linda Piazza : 9/20/2005 10:37:33 AM

The last 15-minute period, the OEX couldn't close above the Keltner resistance now at 572.53 on 15-minute closes. It's challenging that again, with the OEX at 572.52. Again, this is either breakout or rollover territory, and conservative bulls might be taking at least partial profit here.

Jonathan Levinson : 9/20/2005 10:37:01 AM

The month symbol is "X" for November contracts.

Jonathan Levinson : 9/20/2005 10:36:39 AM

QQQQ's range is 39.45-39.54 in what is either a complex top or a bull flag/ "p" accumulation pattern. Volume breadth is so strong that it could be in blowoff territory, but the fact that it's been strengthening from the open makes it look bullish. I'm tempted to short this range, but the shape of the 60/30 min cycles and the volume breadth are keeping me out. Link

Linda Piazza : 9/20/2005 10:30:23 AM

During this 15-minute period, the SOX has pushed above its 15-minute 100/130-ema's, averages that had been holding it back on tests since Thursday morning. Those averages are at 472.33 and 473.15. SOX bulls want to see the SOX hold above those averages and do not want to see a quick reversal down through them again. SOX at 473.83 as I type, down from 474.18 high, approaching Friday's last 15-minute swing high of 474.71.

Jeff Bailey : 9/20/2005 10:30:02 AM

10 Most Active ... CNXT $1.94 +19.01%, QQQQ $39.52 +1.10%, JDSU $1.87 +4.46%, STEM $5.85 +18.25%, SPY $123.52 +0.34% (not yet to WEEKLY Pivot), SEBL $10.33 +0.58%, TPX $12.47 -23.87%, CSCO $18.33 +0.88%, MSFT $26.18 +0.69%, SIRI $6.85 +2.23%

Jonathan Levinson : 9/20/2005 10:27:41 AM

Volume breadth up to +1.56:1 for the NYSE, +5.04:1 for the Nasdaq.

Jonathan Levinson : 9/20/2005 10:27:08 AM

Session low for crude oil at 65.80, natgas holding a .475 loss at 12.79.

Jonathan Levinson : 9/20/2005 10:26:39 AM

VIENNA, Austria (AP) -- OPEC agreed Tuesday to make available 2 million extra barrels of oil a day in an effort to reassure markets edgy over supplies for the winter and storms threatening refineries along the U.S. Gulf Coast.

The Organization of Petroleum Exporting Countries said it would offer the extra oil for three months starting Oct. 1, but that its output ceiling would remain unchanged at 28 million barrels a day, in a bid to ease fears of insufficient supply and high prices ahead of the winter heating season.

Linda Piazza : 9/20/2005 10:26:07 AM

My 10:21 post brings up a matter that I've been meaning to address. Our website responds rather quickly, but by the time we writers compose a post, edit it, even if it's only a cursory edit, and then upload a post, prices can have changed, sometimes radically. So, we may have a posted time stamped and then a price mentioned that wasn't available or applicable at that time stamp. I'm a fast, fast typist, but even I see big discrepancies sometimes in my posts, and the futures writers sometimes have big ones, too, the way the futures move.

Jeff Bailey : 9/20/2005 10:21:56 AM

10:00 Internals found at this Link

Yesterday's Internals found at this Link

Linda Piazza : 9/20/2005 10:21:56 AM

Currently, the OEX tests the top of that same old Keltner channel that usually contains its movements. That's currently at 572.51 on 15-minute closes, with the OEX at 572.60 currently and with several minutes left in this 15-minute period. I wouldn't be surprised to see it rise up to test the boundaries of that triangle, either, but bulls need to have profit-protecting plans in place now. In almost all cases when the OEX tests the boundaries of this particular channel, it's a good idea to take at least partial profit and raise stops on the rest, if not exit the whole position. If you're in a bullish OEX position, you might consider taking partial profit now and ratcheting up those stops. There could be a breakout, of course, and the risk you're taking is that you won't be participating fully in such a breakout. If I'd entered a bullish position this morning, I'd be taking that partial profit, for sure, if not full profit, being that it's an FOMC day and I'd be antsy about protecting profits.

Jonathan Levinson : 9/20/2005 10:15:57 AM

New highs for QQQQ at 39.46, but volume is light. The lower stop out rate suggested strongly that there will be no rate hike, as the stop out rate tends to creep up to the target rate in time for the FOMC announcement. Yesterday's QQQQ high has just been exceeded as I type. Link

Linda Piazza : 9/20/2005 10:15:30 AM

So far, short-term OEX bulls have had no worries. Each little pullback in the advdec line is met with only sideways movement in the OEX and each little jot higher in the advdec line is met with a push higher on the OEX. So far, the advdec line has not pulled back, far, either, currently printing its second doji of the day.

Note, though, that the OEX is approaching the Keltner target and resistance currently at 572.43. The top of the triangle in which it trades is at about 573.10-573.30, depending on how it's drawn.

Linda Piazza : 9/20/2005 10:10:58 AM

Advdec line beginning to pull back now, but I wouldn't call that pullback steep yet. First potential support near +1100 already being approached, with the advdec line at 1262 as I type.

Linda Piazza : 9/20/2005 10:08:28 AM

Subscriber D.C. has just pointed out the TRIN's level, at 1.26 as I type.

Linda Piazza : 9/20/2005 10:06:56 AM

Still watching the SOX. It's a little above the 50-sma now, as well as the 30-sma. SOX at 470.67 as I type, with the 50-sma at 470.35. The 21-sma is near next horizontal resistance at 472.21, with the Keltner 15-minute chart suggesting a possible upside target near 472.76, if the SOX can maintain 15-minute closes above the Keltner line currently at 469.68.

Jeff Bailey : 9/20/2005 10:06:46 AM

10:00 Market Watch found at this Link

Jonathan Levinson : 9/20/2005 10:04:16 AM

Ten year notes have strengthened slightly, TNX down to a .6 bp gain at 4.253%, and QQQQ hit a high of 39.34 as the 60 min cycle rises up to join the 30 in a new upphase. R1 is at 39.39 here, with upper 30 min channel resistance up to 39.36. The short cycle upphase has maxxed out and is now trending in overbought, with Nasdaq volume breadth up at +3.08:1. Link

Linda Piazza : 9/20/2005 9:59:36 AM

No pullback during this 15-minute period on the advdec line. The OEX and advdec line both will likely produce a doji during the current 15-minute period. Bulls want a push higher from the close of this 15-minute period; bears want a drop from the close of this 15-minute period.

Jonathan Levinson : 9/20/2005 9:57:17 AM

The Fed announces a 5B overnight repo for a net drain of 4.5B today, but the demand for money declined another 4 bps on treasury collateral with the stop out rate down to 3.49, suggesting no rate hike for today. Only a few hours left to go.

Jonathan Levinson : 9/20/2005 9:55:26 AM

Linda, I agree with your analysis. Gold is barely rising at all in CAD, ditto for silver, because the CAD is relatively strong as well- which is why CEF continues to do nothing despite the rallies in gold and silver in other currencies. The move in gold in USD is the result of stronger demand for gold in other currencies, and it needs to be computed on a currency by currency basis.

Linda Piazza : 9/20/2005 9:52:40 AM

No appreciable pullback in the advdec line yet, but this is the 15-minute period when such a pullback often begins after the advdec line has hit the resistance it hit this morning. Watching for that possibility, but I wouldn't necessarily term it a probability. It was enough of a possibility to keep me personally from a long position at the open, though.

Linda Piazza : 9/20/2005 9:47:18 AM

The RLX hasn't done much this morning, hanging around near the flat-line area. The BIX is posting a small gain.

Linda Piazza : 9/20/2005 9:46:41 AM

SOX testing the former rising trendline off the August low and the converging 30- and 50-sma's, at 469.93 and 470.33, respectively, with the SOX at 469.84.

Linda Piazza : 9/20/2005 9:45:21 AM

I'm watching for the possibility that the advdec line has hit resistance and could pull back steeply, perhaps after another punch higher. If it does, and if you're bullish and trading pre-FOMC today, consider not buying the dips if the OEX pulls back steeply while the advdec line does. If the advdec line does sink, I'll let you know when I think the advdec line might be hitting support and how it's handling that, and you can make a decision then. I won't be recommending any positions pre-FOMC, I don't think, but am glad to give both bearish and bullish traders input, according to what I see.

Jeff Bailey : 9/20/2005 9:43:19 AM

Bearish swing trade put lower target alert for the Goldman Sachs GS Oct. $100 Put (GS-VT) to $0.15 per contract. Currently $0.00 x $0.05

Jonathan Levinson : 9/20/2005 9:39:34 AM

Yesterday's 39.30 pivot looks like stiff resistance here and this opening strength looks suspicious, but with the 30 min cycle in a young upphase, nowhere near overbought, I'm inclined toward patience this AM.

Linda Piazza : 9/20/2005 9:37:09 AM

The OEX is chugging right toward its potential 572.27 Keltner target, toward the 573.30-ish top of the triangle into which it's settled. Unfortunately, another indicator I watch is signaling the potential for the early pop to be the only pop. I'll need to see more information as the day proceeds, but it sure stayed my hand about personally entering a long position. I'd already stated this morning that I'd be cautious about suggesting any positions for others, either, pre-FOMC.

Jonathan Levinson : 9/20/2005 9:35:39 AM

Volume breadth is +1.75:1 on the NYSE and +3.88:1 on the Nasdaq.

Jeff Bailey : 9/20/2005 9:33:54 AM

Bearish swing trade stop alert for the QQQQ $39.25 here.

Linda Piazza : 9/20/2005 9:33:32 AM

The OEX didn't open above the 15-minute 100/130-ema's, but it's pushing above them now. Trouble is that some of the other signs I watch are giving mixed signals at the open. Not confident at all of that push to the 572 level or 573.30 level, although a 15-minute close above a Keltner line currently at 570.27 sets up an upside Keltner target of 572.20. Some indicators are showing the possibility of a pop-and-drop day or at least the expected pop-and-sit-there day.

Jonathan Levinson : 9/20/2005 9:31:24 AM

QQQQ continues its decline from its 8:30 highs, having just traded a session low at 39.16 and 14 cents above its 72 SMA. QQQQ bulls need to hold price above 39.02 in order to maintain the 30 min cycle upphase and give the 60 min cycle a chance to turn up to join it. The short cycle upphase has not yet reversed, but has entered overbought territory. Link

Jeff Bailey : 9/20/2005 9:29:55 AM

Goldman Sachs (GS) $118.28 ... called higher at $120.40 after the broker reported Q3 profits of $3.25 (consensus was $3.25 per share), or $1.61 billion, which was up 83% from the same period last year. Revenues were up 61% to $7.29 billion, from $4.53 billion.

Jonathan Levinson : 9/20/2005 9:28:32 AM

Headline:

TROPICAL STORM RITA NOW A HURRICANE: HURRICANE CENTER

Jeff Bailey : 9/20/2005 9:26:55 AM

QQQQ is trading higher at $39.21. I'm going to keep a bearish stop firm at $39.25 with DAILY R1 still higher at $39.34. A "bearish fit 38.2%" retracement (see nq05z) would have 19.1% on the QQQQ at $39.26.

October Unldeaded (hu05v) is getting hit lower, down 10 cents, or -4.90% at $1.94.

10-year yield ($TNX.X) is up 1.2 bp at 4.259%.

Linda Piazza : 9/20/2005 9:26:39 AM

If the OEX should open above 570.27, there's a chance that it could be on its way to test the top of the neutral triangle I mentioned earlier, although 572 may be tough resistance to get past. The climb could happen early, and then the OEX could just sit for a while pre-FOMC. I'd have to see how the internals look before I had any idea how likely a test 572-573.30 resistance was to be tested this morning, but it's a possibility that's setting up. If it's going to happen, chances are that only those already in bullish positions can benefit, though, and I'd advise caution against entering any new positions on this morning of a FOMC meeting.

Fundamentally, I'm worried about the many worries facing investors this morning, but look at the DAX steadily chugging its way higher (although it's currently coiling) after Monday's strong gap lower due to election uncertainties that persist. So, I'm just looking at charts and they show that possibility of a push toward a test of resistance, if certain conditions are met. The trouble is that by the time traders assure themselves they're being met, the move may be over.

Jeff Bailey : 9/20/2005 9:17:07 AM

Program Trading Levels ... HL Camp & Company has their computers set for program buying at $+7.11 and set for program selling at $+4.83.

Linda Piazza : 9/20/2005 8:58:58 AM

Yesterday, the OEX erased all of Friday's gains intraday, but then bounced from the bottom of Friday morning's gap and closed just a few cents below the 50-sma. The 72-ema and 200-sma support were also waiting just below that gap. The bounce could have been anticipated, but the OEX still ended the day below the midpoint of Friday's range. The day wasn't bullish.

Now what? First, caution should be the word of the day ahead of an as-yet-unknown path for Rita and as-yet-unknown Fed decision. The OEX ended at the mid-channel level on its 15-minute chart and near it on the 30- and 60-minute charts, not giving many clues as to next direction. RSI ended near the neutral level on all three charts, too. There just wasn't much evidence to go on as the day ended, but the action overall was certainly anything but bullish. One problem is the OEX's tendency to move big, crossing the 72-ema, as it did on 9/06, and then consolidate for several weeks. An extremely bullish day is often followed by an extremely bearish day, and vice versa, with an occasional doji starring the pattern. Some traders switch camps daily with each swing back and forth. Not me. I'm back to being a "chopper," considering it likely that the OEX will continue to chop around above the 72-ema and 200-sma and below resistance . . . well, until it doesn't. This is impression is corroborated by the presence of a possible H&S on the daily chart, with the OEX now in the right-shoulder level, a level that often sees some chop as the top of the should is flattened prior to either confirmation or invalidation of the formation.

There's some hint of the OEX narrowing its consolidation into a triangle shape, with top resistance at about 573.30 currently and bottom support at about 568. Watch for the possibility that the OEX might chop around within that formation pre-FOMC, and then break afterwards. I'm going to be cautious about entering or suggesting new plays this morning because of that chopping-around possibility within a narrowing triangle. If the triangle's support or resistance are broken post-FOMC meeting and traders elect to take a position in the direction the triangle is broken, be wary of possible quick reversals. The first post-FOMC move is not always the final one.

A couple of notes: The SOX closed below its 50-sma and below the rising trendline off the August low. If it climbs this morning, watch the SOX's relationship to the 50-sma. The RLX fell below its 200-sma and confirmed a H&S on its daily chart, although it bounced from 435-ish support. If it continues climbing, it could retest that neckline and the 200-sma. The TRAN closed well below its 200-sma but bounced again from its 200-ema, as it did last week and seems mired in a congestion zone between the 72-ema's resistance at 3653.02 and the 200-ema's support at 3576.21, so I don't know that we can draw much information from the TRAN until it breaks out one direction or another.

Jane Fox : 9/20/2005 8:49:41 AM

Dateline WSJ Oil prices surged as a new storm, Rita, headed toward the Gulf of Mexico, and OPEC ministers meeting in Vienna all but admitted they have no real means to cool red-hot petroleum markets.

The looming new threat to Gulf oil facilities eclipsed efforts by ministers of the Organization of Petroleum Exporting Countries to craft a reassuring message reiterating they would produce more oil if needed. It also underscored the U.S.'s dependence on the Gulf region, home to about a quarter of the nation's oil and natural-gas production and a large number of refineries.

The price of U.S. benchmark crude-oil futures for October delivery shot up $4.39 a barrel on the New York Mercantile Exchange -- the highest one-day rise in nominal terms since it began trading oil futures in 1983 -- settling at $67.39. Gasoline and heating-oil futures also rose sharply.

Linda Piazza : 9/20/2005 8:48:51 AM

Good Morning America features a report on China's economy this morning. Much of the information we already know, being tuned in to China's growing economy. However, one startling bit of information is that, by the population terms that the program thought satisfied parameters for a "major urban center," the U.S. has nine and China has 174.

Jonathan Levinson : 9/20/2005 8:45:49 AM

QQQQ's 30 min cycle has turned up and is roughly half way through its upphase, while the 60 min cycle hasn't even twitched yet, still in its downphase. It's pretty common to see the intraday cycles grow chaotic and choppy ahead of a fed announcement, and I doubt we're going to see a tradeable move this morning. The daily cycle remains in the opening stage of its new downphase. 100-tick QQQQ chart at this Link

Jonathan Levinson : 9/20/2005 8:32:09 AM

Headline:

'MINIMAL' IMPACT FROM KATRINA ON AUG. HOUSING DATA

A yawn from the markets on the slight miss, with TNX up 1.4 bps at 4.261% and QQQQ +.16 at 39.25. Crude oil is down 1 at 66.50, natgas -.485 at 12.78.

Jonathan Levinson : 9/20/2005 8:30:54 AM

Headlines:

U.S. AUG. HOUSING STARTS FALL 1.3% TO 2.009 MILLION RATE

U.S. AUG. BUILDING PERMITS FALL 2.2% TO 2.124 MILLION RATE

Jonathan Levinson : 9/20/2005 8:21:58 AM

Ten year notes hold a small loss at the cash open, with TNX quoted +1.4 bps at 4.261%, testing resistance here.

Jonathan Levinson : 9/20/2005 7:52:51 AM

Equities are up, ES trading 1240.75, NQ 16.06.5, YM 10632 and QQQQ +.16 at 39.25. Gold is up 1 at 471.40, silver -.03 at 7.371, and ten year notes down 1/64 at 110 3/4. Crude oil is down .925 at 66.575, and natural gas is down .325 to 12.94.

We await Housing Starts and Building Permits at 8:30, est. 2.025M and 2.129M respectively.

Linda Piazza : 9/20/2005 7:20:58 AM

Good morning. The Nikkei hit a four-year intraday high and a four-year closing high last night, closing beneath the next resistance level after a strong gain. Most other Asian markets closed higher, with China's an exception. Most European markets gain, too, despite some troubling developments. As of 7:08 EST, gold was higher by $1.80, to $472.20, and crude, lower by $0.99, to $66.40. More detail about Asian and European markets follows in succeeding paragraphs.

Before the Nikkei opened last night after its three-day holiday, reports centered on North Korea's announcement that it would abandon nuclear weapons if the U.S. and Japan committed to working jointly to establish diplomatic relations with the country and if the U.S. assured the country that it would not invade or attack. Some reports indicated skepticism about the ability to verify that North Korea was truly abandoning the program. The agreement was barely hammered out before North Korea began imposing new conditions, however. Japan stated that the country's demand for civil reactors before any dismantling of weapons occurred was not a condition it thought reasonable, with that demand one that could undo the whole agreement.

Focusing on market-specific news, some felt that machine tool firms would upgrade earnings soon based on strong orders. Some speculated that manufacturers of LCDs would change their focus to models smaller than PCs. Six Japanese, U.S. and European banks announced that they would offer yuan forward foreign exchange trading in China to some clients, with Japan's Tokyo-Mitsubishi and Sumitomo Mitsui Banking Corp. being among those six banks. Some even wondered if Japanese equities were overbought and subject to a "dive," as one source noted.

If Japanese equities are due for a dive, it wasn't happening Tuesday. The Nikkei gapped higher, and was soon climbing above 13,000. Some believe 13,000 to be a psychological S/R level rather than a technical one, with stronger resistance from 13,180-13,225, and the Nikkei almost hit that with a high of the day at 13,159.39. According to Marketwatch.com, that was a four-year intraday high, and the closing level was a four-year high, too. The Nikkei closed a little off that high of the day, but still 189.89 points or 1.47% higher, at 13,148.57. After the close, the Bank of Japan's Mizuno had encouraging things to say about the current recovery, its resiliency to shocks, and domestic demand's part in that recovery. Mizuno is one of a group that believes that the CPI could show gains earlier rather than later, showing that Japan is moving out of a deflationary period, but believes that quantitative easing should not be ended until several months of CPI growth.

Most other Asian markets were higher, with China's one exception. Friday's G7 meeting will likely focus on currency flexibility, with increased calls again for further revaluation of the yuan and the currencies of other emerging Asian countries. The statement will likely include another warning against excessive volatility in exchange rates, however. The Taiwan Weighted gained 1.16%, and South Korea's Kospi rose 1.43%. Singapore's Straits Times climbed 0.39%, and Hong Kong's Hang Seng gained 1.73%. China's Shanghai Composite dropped 0.66%, however.

Most European markets climb despite lots of problems to consider. This morning, September's ZEW German investor confidence dropped to 38.6 from August's 50, impacted by rising crude and the growing uncertainty after last weekend's election. A decline had been expected, but only to 45, so the drop was much deeper than expected. Much focus remains on the ambiguity of Germany's election results, and now widens to a discussion of how that will impact the EU. A clear Merkel victory had been counted upon in some circles, with Merkel intending some reforms that would have been in line with those the U.K. wants, for example. Some speculate now that the election will result in a grand coalition of both major parties and that the coalition would more likely be led by Merkel. Further machinations and coalition-building may threaten that outcome, however. Germany's Siemen's announced yesterday that it would cut jobs by 2,400 amid a climate of a rising unemployment rate. An economic institute trimmed its estimates for this year's growth to 0.6% and next year's estimate, too.

In the U.K., the RICS August House Price Balance climbed to a -26 from July's revised higher -34. Both that study and another done yesterday have mentioned increased interest due to the August rate cut. In this latest study, the ratio of completed sales to unsold property climbed to 30%, its highest level this year. This created a sense that the housing market was stabilizing again.

As of 7:09 EST, the FTSE 100 was higher by 0.50 points or 0.01%, at 5,430.20. The CAC 40 was higher by 16.59 points or 0.37%, at 4,522.27. The DAX was higher by 17.72 points or 0.36%, to 4,943.85. Since yesterday morning, the DAX has been climbing up within the huge gap down Monday morning, but today it's coiling near the mid-point of that gap.

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