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OI Technical Staff : 9/22/2005 9:59:59 PM

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Jeff Bailey : 9/22/2005 6:35:52 PM

Closing U.S. Market Watch at this Link

Jeff Bailey : 9/22/2005 6:31:52 PM

Closing Internals found at this Link

Jeff Bailey : 9/22/2005 4:49:15 PM

Continental Airlines (CAL) $9.68 -2.32% Link ... Company saying it continues evacuation process at its Houston, TX hub. "We are committed to the safety of our customers and employees," said Larry Kellner, chairman and CEO. "We are doing our best to evacuate as many people as we can until we are forced to suspend operations at noon tomorrow."

Jeff Bailey : 9/22/2005 4:47:05 PM

WellPoint Health (WLP) $73.19 +1.27% Link ... announces modified pharmacy guidelines and expanded health services to its members who are directly impacted by Hurricane Rita. The guidelines should help members quickly access needed drug perscriptions. Members who evacuate can refill perscriptions (for up to 90 days of medicine) before leaving.

Jeff Bailey : 9/22/2005 4:38:06 PM

Current OPEN MM Profiles found at this Link ... Today's Activity ... After nearing my raised bullish target of $117.00 with a trade at $116.88, I was swing trade stopped on the 1/2 bullish position in shares of Valero Energy (VLO) at $112.45.

Jeff Bailey : 9/22/2005 4:00:38 PM

Sun Microsystems (SUNW) $3.910 -1.01% ... Moody's cuts ratings of company's Sr Unsecured to Ba1 from Baa3; Outlook stable.

Linda Piazza : 9/22/2005 3:58:20 PM

So what do you do here at the end of the day? If I were in a bullish play, which I haven't recommending being in, I would certainly consider taking at least partial profit, if not full profit. What about a new bearish entry? Depending on how much risk you like to take on, that might be an okay trial play for an aggressive trader. I'd limit the number of my contracts, though, as this would be a trial balloon only. The OEX tends to alternate these tall white candles with tall red ones and consolidate once it moves big for several days, so some consolidation beneath the 200-ema might be possible now. I'd be very wary tomorrow about any bearish play entered and held overnight, though, if the OEX should open above that average, unless it quickly began moving down.

Jeff Bailey : 9/22/2005 3:56:02 PM

Shell DJ - working to resupply retail fuel stations quickly. (upate to 03:54:43)

Jeff Bailey : 9/22/2005 3:54:43 PM

Shell DJ - company saying its service stations running out of fuel in Rita area.

Jeff Bailey : 9/22/2005 3:53:33 PM

ATP Oil & Gas (ATPG) $32.06 -2.81% Link ... CEO saying 22 of its 25 rigs/platforms in Gulf of Mexico are now evacuated.

Jonathan Levinson : 9/22/2005 3:51:33 PM



Linda Piazza : 9/22/2005 3:48:58 PM

The OEX hasn't given up challenging that neckline of that inverse H&S yet. It may go into the close, with the OEX ending up near the 200-ema at 563.80. The OEX is at 563.47.

Jeff Bailey : 9/22/2005 3:47:17 PM

Delphi Corp. (DPH) $3.13 -10.05% Link ... Chief Executive Steve Miller saying auto parts maker is prepared to file for bankruptcy at any time.

Linda Piazza : 9/22/2005 3:43:49 PM

OEX again pulling back from its 200-ema. Someone is noticing that number. The pullback isn't deep yet.

Linda Piazza : 9/22/2005 3:39:09 PM

The BIX is also challenging the neckline of a potential inverse H&S.

Linda Piazza : 9/22/2005 3:38:07 PM

The OEX has recreated that 565.54-565.79 upside Keltner target by climbing back above and closing a 15-minute period back above Keltner lines currently at 562.56-562.75. As long as it produces 15-minute closes above those lines, it maintains that potential upside target.

Jonathan Levinson : 9/22/2005 3:30:06 PM

Volume breadth is quite tame, +1.18:1 on the NYSE and +1.15:1 on the Nasdaq.

Linda Piazza : 9/22/2005 3:28:16 PM

The OEX is testing its HOD and also that 200-ema at 563.81. It's also testing the neckline of its inverse H&S. Mixed bullish and bearish messages here, and I don't have a good read on what's going to happen. I'd say that this should be tough resistance, but I don't see a sign of a breakdown yet or anything that would suggest one and the advdec line is charging higher.

Jonathan Levinson : 9/22/2005 3:27:23 PM

QQQQ's bounce from 38.50 has just maxxed out the wavelet cycle as the short cycle tries to turn up again. 30 and 60 min channel resistance line up at 38.76, but in the meantime, that 38.50 level is a much higher low if the price doesn't dropped from here. If the session highs don't hold, I'll expect to see the 30 and 60 min channel tops begin climbing. Link

Linda Piazza : 9/22/2005 3:22:32 PM

Advdec line approaching resistance.

Jeff Bailey : 9/22/2005 3:21:42 PM

03:00 Internals found at this Link

Linda Piazza : 9/22/2005 3:21:27 PM

Here's a potential inverse H&S that I'm watching on the OEX's 15-minute chart. Link You know the drills about these, how you can't count on them to confirm, how the neckline is a vulnerable place, how a minimal confirmation can then see a push the other direction and an ultimate rejection of the formation, etc. Still, it's something that should be watched.

Linda Piazza : 9/22/2005 3:09:58 PM

I keep beginning to type that the OEX is dropping beneath the five-minute 100/130-ema's, only to have the OEX spring back to those MA's again. That's a sign that bears can't keep it down when it's driven down, and suggest a possibility that resistance will continue to be challenged. It's not necessarily a sign that the OEX will break out to the upside, but . . . well, you know the rest.

Linda Piazza : 9/22/2005 3:07:48 PM

RLX reaching again toward the HOD, but threatens a double-top formation. It's still testing the 15-minute 100/130-ema's, however, so I wouldn't make any big assumptions either direction until there's a 15-minute close above the 130-ema at 433.73 or below the 100-sma at 431.80, at the least. RLX at 432.38 as I type.

Jeff Bailey : 9/22/2005 3:06:34 PM

Seeing October Unleaded back at mid-point of today's range.

Jeff Bailey : 9/22/2005 3:06:16 PM

Sell Program Premium ... DIA $103.99, SPX 1,212, QQQQ $38.52

Jonathan Levinson : 9/22/2005 3:05:55 PM

QQQQ is coiling into another pennant here: Link , breaking south as I type. The last one broke falsely to the upside and then reversed back down, earlier this AM.

Jeff Bailey : 9/22/2005 3:03:58 PM

03:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 2:58:55 PM

That picture I painted in my 2:56:41 post? The SOX could spoil that picture entirely.

Linda Piazza : 9/22/2005 2:56:41 PM

The RLX has risen into a 19.1% retracement of the decline off the 7/29 high. It's done that in one day. That 19.1% retracement is at about 433.61, with the 38.2% retracement at 446.84. The RLX is currently at 432.88, just below that 19.1% retracement level. As long as the RLX is performing strongly, we perhaps shouldn't count on the OEX dropping back too much. I'm wondering if the RLX isn't on its way up into a retest of the H&S neckline, with that H&S confirmed on its daily chart and with that neckline at about the 38.2% retracement. If so, I would expect some zigging and zagging along the way up to retest that neckline, with bearish days perhaps alternating with bullish ones as a bear flag forms on the daily chart. However, this possibility would urge caution for those too eager with a trigger finger to enter bearish OEX plays today, if the RLX continues performing strongly. It's just one thought and something to be watched.

Linda Piazza : 9/22/2005 2:50:05 PM

OEX Keltner picture: The OEX was not able to maintain 15-minute closes above the line currently at 562.71, so hasn't maintained its upside target of 565.73. Is has, however, so far maintained support at a line at 562.05, and that suggests that it could go on challenging that resistance just overhead and could still reset that target. It's all iffy right now. If this is a bear flag, it hasn't firmed up yet, and there's no one formation that's going to say that the OEX is heading here or there. The action suggests to me, however, that there might at least be a continued short-term push to try to break through resistance without giving a firm clue as to whether the OEX will be able to do so.

Jonathan Levinson : 9/22/2005 2:48:51 PM

The 30 min cycle upphase is roughly halfway done, the 60 min cycle upphase still in its first 1/4 or so, both with plenty of room to run. Those upphase could be truncated by the still-strong daily cycle downphase, however, and so this is still a very iffy area in terms of direction. Volume breadth is equally ambiguous at -1.16:1 for the NYSE and -1.02:1 for the Nasdaq.

Linda Piazza : 9/22/2005 2:43:29 PM

Potential H&S on the OEX's five-minute chart. Those hoping for a higher bounce, for whatever reason, want to see the OEX hit a new HOD to invalidate that formation.

Linda Piazza : 9/22/2005 2:42:00 PM

Advdec line bouncing from support.

Jonathan Levinson : 9/22/2005 2:39:07 PM

Crude oil closed -.20 at 60.60, natural gas +.105 at 13.105.

Jonathan Levinson : 9/22/2005 2:38:31 PM









Linda Piazza : 9/22/2005 2:37:09 PM

To be clear, I have not suggested any play today, but have all day been anticipating a possible countertrend bounce. I did not think that was a good risk for OEX long options players, but have been hoping that it would get going and go high enough to suggest a new bearish entry, and would also set up in a form, such as a bear flag, that would help suggest such a new entry. I had, however, hoped that such a bounce would occur earlier in the day than it has, and am now afraid that the OEX might not set up a possible new entry until late today or even tomorrow. It might not even signal a new entry before it just craters. There will always be a good play to come along later. Don't enter a too risky play or chase one.

Linda Piazza : 9/22/2005 2:28:53 PM

Traffic leaving my old Houston neighborhood, where the author of the email in my 12:43:32 post lives: Link

Jeff Bailey : 9/22/2005 2:23:51 PM

02:00 Internals found at this Link

Linda Piazza : 9/22/2005 2:22:54 PM

I think one hang-up is the SOX's 72-ema at 458.60. It's going to be difficult for the SOX to get much above that.

Linda Piazza : 9/22/2005 2:22:01 PM

The OEX is slipping just a little below its five-minute 100/130-ema, but staying above the five-minute 21-ema, at least for now. The OEX's pattern could again be that of an inverse H&S trying to build, this time on the 15-minute chart, with this pullback a possible right-shoulder formation. As long as the OEX doesn't fall below about 560.90, that remains a possibility. The RLX currently tests its 15-minute versions of the 100/130-ema's, having broken higher out of its bear-flag looking climb. The advdec line is still struggling with the same resistance that stopped it earlier, but not retreating from it in the same pattern it did earlier. Still a mixture of evidence here. I see a possibility, but not yet a probability, of a continued bounce, although I'd be prepared for the bottom to fall out at any time, too.

Jeff Bailey : 9/22/2005 2:15:08 PM

October Unleaded (hu05v) alert $2.05 (unch) and session low (30-min delayed)

Jonathan Levinson : 9/22/2005 2:13:28 PM

The wavelet cycle just whipsawed to the downside as price dropped hard below 38.60 QQQQ, driving back to the intraday pivot: Link

Jonathan Levinson : 9/22/2005 2:10:49 PM

Mark, GOOG intraday is like the weather in Vancouver/Seattle. If you don't like it, wait 20 minutes ;)

Linda Piazza : 9/22/2005 2:09:31 PM

Here's the OEX's Keltner picture. It's clinging to 15-minute Keltner support at 562.80, with further support at 561.92. If the OEX can maintain 15-minute closes above that line at 562.80, it's set an upside target of 565.88. that would be between a 38.2% and 50% retracement of the steep decline. Since this is a bounce I'd consider a countertrend bounce, I'd be careful about assuming that upside targets are going to be hit, but this just gives you some things to watch. I'd watch that potential resistance in the 565-566 zone carefully.

Jonathan Levinson : 9/22/2005 2:08:44 PM

Volume breadth up to -1.03:1 on the NYSE, +1.19:1 on the Nasdaq.

Linda Piazza : 9/22/2005 2:07:06 PM

The OEX has retreated to retest the five-minute 100/130-ema's, as I thought it might, and is now trying to bounce from them. Needs to see a new HOD to confirm the bounce.

Jonathan Levinson : 9/22/2005 2:04:59 PM

A wavelet cycle upphase is due here, within a very toppy short cycle trying to roll over. A lower high below the session highs should be a good short entry for QQQQ. The bulls have between 10-15 minutes to take out the highs here before the expected wavelet top. Link

Jeff Bailey : 9/22/2005 2:02:05 PM

02:00 Market Watch found at this Link

Jonathan Levinson : 9/22/2005 1:58:37 PM

Session low for natural gas at unchanged, 13.00.

Jeff Bailey : 9/22/2005 1:55:01 PM

Valero Energy (VLO) $110.55 ... drops into Tues-Wed gap

Jonathan Levinson : 9/22/2005 1:52:24 PM

Ten year note yields holding their .7 bp loss at 4.181%, 13-week bill rate +1.3 bps at 3.355%.

Linda Piazza : 9/22/2005 1:51:24 PM

Knew before I looked: The SOX is back at its 72-ema at 458.62.

Linda Piazza : 9/22/2005 1:50:45 PM

Uh-oh. Just noticed that the OEX hit its 200-ema at 563.80 before pulling back slightly. This MA sometimes does have relevance for the OEX, although not as strong as some other MA's.

Jeff Bailey : 9/22/2005 1:49:24 PM

Ameritrade (AMTD) alert $20.65 -0.09% ... for the bulk of this morning's session the company's internet was down and traders were unable to access their accounts online, but were able to execute transactions via telephone.

I'm just now able to get my account information online.

Linda Piazza : 9/22/2005 1:48:25 PM

Might expect the OEX to drop back now and retest the five-minute 100/130-ema's, at 562.00 and 562.63, respectively, to see if they hold as support.

Jonathan Levinson : 9/22/2005 1:49:06 PM

Session low for crude oil here, down .40 cents at 66.425. Last I heard, Category 4 was still well into disaster territory, certainly nothing to celebrate, but for the moment the markets are reacting first and reflecting later.

Linda Piazza : 9/22/2005 1:46:06 PM

I just didn't think that the OEX was going to go much lower than 568.70-568.90 before mounting some kind of bounce attempt. I thought this would happen earlier today, though. So far, the bounce is a strong one, not looking corrective at all, so we have to wait for it to settle down and form something identifiable before we assume that a rollover is imminent. The advdec line is moving up into resistance that stopped it this morning, and if it can get above about -650 or so, it, and the OEX might rise even higher. There might be a little pause now, though, as that resistance is tested.

Jonathan Levinson : 9/22/2005 1:45:36 PM

SAN FRANCISCO (MarketWatch) -- Rita has been downgraded to a category 4 hurricane, according to the latest update from the National Hurricane Center, with maximum sustained winds decreasing to near 150 miles per hour. Some slight weakening is forecast during the next 24 hours but Rita is expected to remain an extremely dangerous hurricane, the NHC said.

Jeff Bailey : 9/22/2005 1:43:55 PM

SPX 1,215.51

Jeff Bailey : 9/22/2005 1:43:43 PM

VIX.X alert 13.52 ... plunging below its DAILY Pivot

Jonathan Levinson : 9/22/2005 1:43:38 PM

Session highs across the board.

Linda Piazza : 9/22/2005 1:43:38 PM

For the first time since Tuesday afternoon, the OEX closed a 30-minute period above a Keltner line currently at 561.06, and it heads up from that former resistance. That resistance has now been converted to possible support, but since the lines still turn down sharply, it's tentative support only. Resistance thins above this, too, though, so the OEX is free to go either direction. So far, it's headed up. A 38.2% retracement of the decline this week is at about 564.64. A 50% retracement is at about 566.32, near the 200-sma.

Jeff Bailey : 9/22/2005 1:42:28 PM

Buy Program Premium ... DIA $014.19, SPX 1,213.96, QQQQ $38.67.

Jonathan Levinson : 9/22/2005 1:41:05 PM

Crude oil is down to a 5 cent gain at 66.85, natgas +.195 at 13.195.

Jeff Bailey : 9/22/2005 1:41:04 PM

Current OPEN MM Profiles found at this Link ... My 1/2 bullish position trade in Valero Energy (VLO) was stopped out. Will continue to keep this "Rita-related" stock posted as it may be a "key stock" observation as to market reactions to Rita sentiment.

Linda Piazza : 9/22/2005 1:40:23 PM

The advdec line is headed up into a level that stalled this morning's bounce. Those hoping for a continued countertrend bounce would like to see the advdec line above about -650, with it now at -1459 and heading into a resistance band.

Jonathan Levinson : 9/22/2005 1:39:33 PM

Volume breadth is still negative, but not by much- -1.31:1 for the NYSE, -1.12:1 for the Nasdaq.

Linda Piazza : 9/22/2005 1:38:56 PM

The OEX consolidates between the former descending regression channel and the five-minute 100/130-ema's, coiling at the top of a climb on that five-minute chart, so perhaps signaling that it may at least go on testing those averages.

Jonathan Levinson : 9/22/2005 1:38:46 PM

Back. QQQQ printed a lower high below R1 at 38.65, and is holding near unchanged from this morning's opening levels despite the wide swings. There's still a lower low and lower high within the young daily cycle downphase, but the rejection at the lows is leaving a bullish lower doji shadow on the daily candle print. The 30 min cycle is pointing north from a bullish divergent bottom, but until yesterday's high is broken, it remains mostly noise within the broader daily cycle decline. Updated 100 tick chart at this Link

Linda Piazza : 9/22/2005 1:37:41 PM

Yes, Jeff, I had a 1:11 post about the RLX, too. And it's just now reached a new HOD, but it's not a big new HOD, so those out there watching it need to watch for a potential double-top formation, just to be on the safe side.

Jeff Bailey : 9/22/2005 1:32:00 PM

Linda ... RLX up 4 since your 12:20:36 post.

Jeff Bailey : 9/22/2005 1:29:33 PM

SPX/SPY option chain found at this Link

Jeff Bailey : 9/22/2005 1:21:58 PM

01:00 Internals found at this Link

Linda Piazza : 9/22/2005 1:21:50 PM

OEX testing the five-minute 100/130-ema's. It could now be trying to form a bigger inverse H&S, so even if it's going to eventually climb higher, a pullback here is not precluded.

Jeff Bailey : 9/22/2005 1:16:56 PM

VIX.X 13.94 +0.14% ... l/h has been 13.58/14.39

Jeff Bailey : 9/22/2005 1:15:57 PM

SPX most active option by far is the Oct. 1,000 Put (SPT-VT) with 23,074:106,506. Low/High has been $1.15/$1.70

Linda Piazza : 9/22/2005 1:15:52 PM

OEX out of that descending regression channel now. About to test the five-minute 100/130-ema's.

Jeff Bailey : 9/22/2005 1:15:01 PM

Ssssssnifff .... something's cook'n here. DIA $103.86, SPX 1,210.37, QQQQ $38.56.

Linda Piazza : 9/22/2005 1:11:11 PM

The RLX is back above its five-minute 100/130-ema's, but not back above its HOD, so runs the risk of a lower high or maybe just a coiling formation.

I still don't see anything definitive about short-term moves today, and came into the day thinking that it might be a consolidation or doji day for the OEX. I had hoped that the doji would take the form of a stronger bounce this morning that was then reversed at resistance, providing a new bearish entry, though. Hopes dashed so far.

Jeff Bailey : 9/22/2005 1:09:12 PM

01:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 1:05:28 PM

The OEX has hit the top of that descending regression channel that's been in place on the five-minute chart since late Tuesday. This time, the OEX did not touch the bottom of that channel before swinging up and hitting the top again, a slight, slight bullishness. However, that's countered by tentative price/RSI bearish divergence as the OEX tested the top of that channel.

Jonathan Levinson : 9/22/2005 1:04:54 PM

I need to step away for 20 minutes here.

Jeff Bailey : 9/22/2005 1:00:04 PM

Dell Computer (DELL) alert $34.11 +2.24% ... seeing some recently weak stock showing some muster.

Jonathan Levinson : 9/22/2005 12:58:39 PM



Linda Piazza : 9/22/2005 12:57:23 PM

The OEX approaches the top of that descending regression channel in which it's been trading since Tuesday, but hasn't yet breached it or the five-minute 100/130-ema's at 561.99 and 562.73, respectively. Will this be the time it does? I commented at 12:30:35 when the OEX was hitting its LOD that I just couldn't believe that the OEX would go too much further without a countertrend bounce, so I wouldn't be surprised to see a break higher in such a bounce, but I still wouldn't consider a long play a good risk.

Jeff Bailey : 9/22/2005 12:56:30 PM

Bullish swing trade stopped alert ... on Valero Energy (VLO) at $112.45

Jeff Bailey : 9/22/2005 12:55:07 PM

Airline Index (XAL.X) alert 39.50 +1.28% ... session highs.

Linda Piazza : 9/22/2005 12:54:57 PM

Jane, it certainly does lay that theory about why people didn't evacuate New Orleans to rest. There are certainly people who can't evacuate because of poverty and also because of disability. My friend with a physically disabled daughter did not think her daughter could tolerate the hours in a car, for example. Even in New Orleans, a paramedic we knew who went in to move nursing home patients to higher ground before the storm was not able to evacuate himself because their ambulance ran out of gas and roads were blocked. It's just impossible to evacuate a major urban area, even with days' notice, unless they'd banned private vehicles leaving and brought in buses or something.

Jonathan Levinson : 9/22/2005 12:52:39 PM

Stepping away for a few minutes.

Jeff Bailey : 9/22/2005 12:52:39 PM

Intra-day energy ... looking at XOM and VLO and other "oil-related" equities. Charts look very much the same. Weakness seems to have come from 11:00 AM EDT update from National Hurricane Center.

Jonathan Levinson : 9/22/2005 12:52:12 PM

Weather.com has free live video feeds that are updated regularly for those without access to a TV.

Jane Fox : 9/22/2005 12:50:54 PM

Linda this lays to rest the argument than only the rich evacuated New Orleans because they had the means and the poor were left because they did not.

Linda Piazza : 9/22/2005 12:50:01 PM

OEX bouncing toward the top of that descending regression channel in which it's traded since late Tuesday. Five-minute 100/130-ema's at 562.05 and 562.79, respectively, and I'd need to see a five-minute close above those before I really believed that the OEX had broken through that channel to the upside. OEX at 560.67 as I type.

Linda Piazza : 9/22/2005 12:46:38 PM

Yes, and there are still many, many who haven't even tried to get out yet, Jonathan. My brother-in-law and his family and my mother-in-law, who are waiting for my brother-in-law to finish work tonight shutting down a refinery in Port Arthur, my friend who works in a hospital, and the list goes on. I'm not saying this to give personal circumstances about myself, but rather to say if I personally know many, many people who haven't yet been able to get out or have tried and turned back (I know many of those), then there are hundreds of thousands or millions who haven't been able to get out.

Jonathan Levinson : 9/22/2005 12:43:16 PM

Linda, that's a terrifying email. I've just finished J-H Kunstler's "The Long Emergency," and this hits awfully close to home for far too many.

Jonathan Levinson : 9/22/2005 12:41:26 PM

QQQQ never touched the lower 30 or 60 min channel bottoms on that drop, and the short cycle indicators are starting to tick up from oversold territory as the wavelet cycle peaks here. Unless the bears can get back to the lows of the day in the coming 10-15 minutes, a new short cycle upphase should confirm.

Linda Piazza : 9/22/2005 12:43:32 PM

Here's an email my daughter just received from a friend in the far northwest corner of Houston, in an upscale subdivision: We are boarding up the house, taking everything off the walls, putting water in every available container (including bathtubs) and cleaning off the counters and the yards for what the weatherman calls "missles" (things that could be picked up by the wind and be a 'missile') and sticking it out here in Houston. Houston is only 45-50 miles off the coast, so we're preparing to be hit pretty hard. The news lady said for us to be prepared to be prepared to be without power for TWO WEEKS! It's really hard to use cell phones now. We were going to head up to Austin, but my dad flew in last night, so we had to wait for him. By that time all of the major (and non-major) highway and interstates are backed up as far as you can see... and then some. Even worse, there is NO gas in the city. None. I drove around all last night looking for some. I saw people waiting at CLOSED gas stations with their cars parked by a pump waiting for a new supply to come in. Everyone's in a panic right now. The only thing worse than getting through the storm would be to run out of gas on the highway trying to get out of town, and that's happening all over the place.

Jeff Bailey : 9/22/2005 12:38:16 PM

12:00 Internals found at this Link

Linda Piazza : 9/22/2005 12:35:59 PM

As the OEX bounces again, watch the top of the descending channel in place since late Thursday, now at about 561.19 and then the five-minute 100/130-ema's at 562.11 and 562.86 for confirmation that the OEX has broken above the channel, if it does. OEX at 560.11 as I type.

Jonathan Levinson : 9/22/2005 12:35:37 PM

The Fed's coupon pass is 1.104B, deliverable tomorrow.

Jeff Bailey : 9/22/2005 12:35:06 PM

Dell Computer (DELL) $33.84 +1.43% ...

Jeff Bailey : 9/22/2005 12:31:39 PM

Valero Energy (VLO) $113.50 +0.32% ... updated 30-minute interval chart at this Link ... sudden reversal from all-time highs finds support at WEEKLY R1.

Linda Piazza : 9/22/2005 12:30:34 PM

I just can't yet convince myself that the OEX is going to see too much more downside before it attempts a countertrend bounce. That's why I, like Jane on the futures side, would have liked to have seen more of a bounce today, so that I knew that bounce danger was out of the way and it was okay to enter a bearish play.

That's from the technical viewpoint. When I lift my view from the charts and answer a phone call from friends and relatives (we're hearing now that gas stations on the route out of Port Arthur/Houston are out of gas and people trying to evacuate are turning off the highways and going back) and thinking of what I know about that area of Texas' importance in oil and gas, I don't see why markets don't just dive. But it's technicals that I trade on, and they're still showing a possibility for a choppy day and maybe even another try at a bounce. Nothing definitive here and certainly no bounce strong enough to allow me to suggest new bearish entries.

Jonathan Levinson : 9/22/2005 12:27:16 PM

Volume breadth -2.27:1 for the NYSE, -2.52 for the Nasdaq.

Jeff Bailey : 9/22/2005 12:24:28 PM

Valero Energy (VLO) alert $112.90 -0.25%

Linda Piazza : 9/22/2005 12:24:28 PM

The OEX again approaches potential 558.70-558.90 support.

Jeff Bailey : 9/22/2005 12:22:59 PM

November Unleaded (hu05v) alert $2.14 +4.39% ... while 30-minute delayed, reversing gains from $2.20.

Jonathan Levinson : 9/22/2005 12:21:26 PM

30 min channel support is down to 38.20 QQQQ, no sign of strength to attract me to longs here: Link

Linda Piazza : 9/22/2005 12:20:36 PM

RLX trying to bounce.

Jeff Bailey : 9/22/2005 12:20:27 PM

12:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 12:20:00 PM

Tentative new LOD for the OEX.

Linda Piazza : 9/22/2005 12:14:09 PM

Tepid little OEX bounce from an almost equal low, at least so far. This is a make or break point for bulls and bears.

Linda Piazza : 9/22/2005 12:11:26 PM

SOX, BIX, TRAN and RLX all so far holding above their LOD's. OEX testing its LOD as I type.

Linda Piazza : 9/22/2005 12:10:22 PM

OEX bears, watch for a potential double-bottom formation. The OEX would have to climb above the day's high to confirm any double-bottom formation, of course.

Linda Piazza : 9/22/2005 12:09:25 PM

Unlike the OEX, the RLX is still far off its 422.33 low of the day, with the RLX at 424.48.

Linda Piazza : 9/22/2005 12:08:26 PM

The OEX is slip-sliding along the midline of its descending regression channel, nevertheless sliding right toward a retest of this morning's 559.22 low. OEX at 559.71 as I type.

Jeff Bailey : 9/22/2005 12:04:30 PM

Latest Strike Probabilities for Hurricane Rita at this Link

Jeff Bailey : 9/22/2005 12:02:07 PM

12:00 Market Watch found at this Link

Jonathan Levinson : 9/22/2005 12:00:02 PM

Gold is down .60 cents at 469.50, but well off its new high of 478.90 earlier this morning. It they close it at or near current levels, it would leave a tall blowoff top/gravestone doji for the day- a potential reversal candle.

Linda Piazza : 9/22/2005 12:00:50 PM

RLX bouncing again, perhaps helping to bounce the OEX, too. The RLX is again about to face its five-minute 100/130-ema's at 426.51 and 427.28, with the RLX at 426.02 as I type. The advdec line isn't showing too much of an inclination to bounce through resistance near -1800, however.

Jonathan Levinson : 9/22/2005 11:59:02 AM

Crude oil down to a .425 gain at 67.225, natgas +.22 at 13.22.

Jeff Bailey : 9/22/2005 11:52:00 AM

Matrix Services (MTRX) $8.16 +0.74% ... Company announces date to discuss results for Q1 ended August 31, 2005. Company saying it will announce Q1 results on Thursday, October 6, 2005 prior to market open.

I would expect the "main top of conversation" from analysts will be pointed toward business prospects, if any, from recent hurricane activity.

Linda Piazza : 9/22/2005 11:53:01 AM

Nothing I see tells me definitively that the OEX will continue lower or continue a countertrend bounce attempt. It hasn't changed that pattern shown in my 11:37 post, pointing to the possibility that it will just sink lower all day, but it's begun today finding support at the midline of that descending regression channel rather than sinking all the way to the bottom, with such action sometimes pointing to strength trying to build. We'd have to see a breakout of that channel, confirmed by a five-minute close above the five-minute 100/130-ema's at 562.62 and 563.37 before we even began to believe that pattern had been changed, however. We saw earlier that the RLX wasn't able to maintain its breakout above the five-minute 100/130-ema's, although even the RLX is trying to steady again, at yesterday's former resistance. I don't think the OEX has given up its attempt to bounce, and that's about all I can glean from that.

Jonathan Levinson : 9/22/2005 11:51:06 AM

Stepping away for a few minutes.

Jonathan Levinson : 9/22/2005 11:50:26 AM

QQQQ's declining intraday cycle bottoms all line up at S1, 38.25 here, with slight short cycle Macd bullish divergences shaping up. I will be evaluating a possible long from that level if we see it: Link

Jeff Bailey : 9/22/2005 11:46:20 AM

Valero Energy (VLO) $115.17 +1.79% ... session low/high has been $114.10-$116.88

Jeff Bailey : 9/22/2005 11:41:27 AM

Texas Oil Refineries Continue to Close ... AP - BP's begins shut down of its Texas City refinery and Shell Oil shutting down its Houston refinery. Exxon Mobil's Baytown refinery now shut down.

Jonathan Levinson : 9/22/2005 11:38:09 AM

Volume breadth down to -1.56:1 for the NYSE and -2.05:1 for the Nasdaq.

Linda Piazza : 9/22/2005 11:37:29 AM

No change in this pattern yet. Link

Linda Piazza : 9/22/2005 11:34:30 AM

Losing the support of its five-minute 100/130-ema's, the RLX fell straight down to the top of the former coiling formation that it had been producing since yesterday morning. It's there now, just above 424.50, with the RLX now at 424.62.

I don't see anything that I'd trade yet on the OEX, either.

Linda Piazza : 9/22/2005 11:32:41 AM

$RLX falling more steeply now.

Jonathan Levinson : 9/22/2005 11:25:56 AM

This could turn out to be one of those "zig" then "zag" false apex breaks that started popping up in the 2003 rally, where the first pennant break would reverse back past the apex. I say this because there's a high-volume battle being fought in QQQQ here, with the wavelet starting to roll over just below overbought territory: Link

Jeff Bailey : 9/22/2005 11:20:13 AM

10 Most Active ... QQQQ $38.44 -0.12%, SPY $121.09 +0.16%, MSFT +25.28 -0.78%, GNW $29.52 -0.27%, CPN $2.61 -1.50%, SUNW $3.87 -1.77%, CSCO $17.77 -0.44%, LU $3.05 (unch), INTC $24.55 +0.24%, GLW $18.57 -6.16%

Jonathan Levinson : 9/22/2005 11:19:48 AM

Possible upside pennant break for QQQQ here: Link

Linda Piazza : 9/22/2005 11:18:26 AM

The OEX is coiling now, along 15-minute Keltner support at 560.78-561.24, with the OEX now at 560.99. That support looks as if it's firming, but that's tentative only. No definitive evidence of either direction.

Jeff Bailey : 9/22/2005 11:14:22 AM

11:00 Internals found at this Link

Jonathan Levinson : 9/22/2005 11:13:43 AM

My guess on that coupon pass is that the Fed is trying to steepen the yield curve a bit. Currently IRX is down 1.2 bps at 3.33%, TNX -1.6 bps at 4.172%.

Jonathan Levinson : 9/22/2005 11:11:27 AM

Crude oil is +.90 here at 67.70, natgas +.30 at 13.30, off session highs of 68.15 and 13.66.

Linda Piazza : 9/22/2005 11:09:58 AM

That 72-ema did the SOX's bounce in this morning, with that average at 458.54, and the SOX is now sitting right on the 50% retracement of 2004's decline, according to my Fib bracket. Caught between support and resistance, and that may be the story for many indices today.

I'm still watching the RLX, still testing its five-minute 100/130-ema's after pressing above them this morning. That's a normal occurrence, but it's what happens with this test that may predict whether the RLX can continue to move higher, and may have something to do with whether the OEX can continue a countertrend bounce, too.

Jonathan Levinson : 9/22/2005 11:06:08 AM

QQQQ bounced from a higher intraday low and is rolling over again here. QQQQ bears need a lower low to avoid confirmation of what otherwise would become a 60 min cycle upphase: Link

Jonathan Levinson : 9/22/2005 11:05:10 AM

The Fed announces a coupon pass, no quantum yet- another permanent addition to the liquidity pool.

Jeff Bailey : 9/22/2005 11:03:38 AM

11:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 10:58:09 AM

The RLX is testing the 38.2% retracement of its day's range, with that at about 427.40 and with the RLX at 427.58. The RLX also retests the five-minute 100/130-ema's that it bounced above today, with those at 426.71 and 427.58. The RLX's pullback looks corrective, like a potential bull flag, and that's the strongest evidence on the side of those who want to see the OEX move higher still. It's not particularly strong evidence, but it should be watched, as the RLX is holding above a 50% retracement, at 426.43.

Linda Piazza : 9/22/2005 10:54:46 AM

Advdec line headed lower again, toward -2000-ish next support. The OEX dipped below the 560.80-ish support, too, but not by much yet.

Jonathan Levinson : 9/22/2005 10:53:49 AM

QQQQ loses 72 SMA support here: Link

Jeff Bailey : 9/22/2005 10:53:37 AM

Sell Program Premium ... DIA $103.70, SPX 1,209.95, QQQQ $38.43

Jonathan Levinson : 9/22/2005 10:52:09 AM

Volume breadth -1.27:1 on the NYSE, -1.65:1 for the Nasdaq.

Linda Piazza : 9/22/2005 10:49:36 AM

OEX still testing Keltner support at 561-561.41 on 15-minute closes, with the OEX now at 561.30 but having closed the previous 15-minute period safely above that potential support. Still no strongly predictable outcome as to whether this bounce is sustainable much longer as some tentative support levels hold but resistance levels do, too. Those who want to see a continued bounce want to see the OEX close a 30-minute period above the Keltner line now at 562.39.

Jonathan Levinson : 9/22/2005 10:46:09 AM

QQQQ continues to test its 72 SMA as support at 38.47, the short cycle downphase working its way lower: Link

Linda Piazza : 9/22/2005 10:46:47 AM

The SOX currently struggles with the 72-ema at 458.59. This average does have relevance for the SOX. The SOX is at 457.25. However, the 50% retracement of the 2004 decline is at about 455.37. Perhaps that's where Marc's 456 is coming in, and he's certainly right about a 50% Fib level being potentially strong support.

Linda Piazza : 9/22/2005 10:39:47 AM

The advdec line holds support, still testing resistance. Needs to push above about -550 to show there's power to continue the countertrend rally. It's at -1266, testing a resistance band that extends up to about -550. So, the advdec line's action neither supports the idea of a continuation or invalidates it, at this point at least.

Jeff Bailey : 9/22/2005 10:36:02 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 9/22/2005 10:32:44 AM

The next step the OEX needs to perform before there's any sustainability to the countertrend bounce is to hit a 30-minute close above a Keltner line currently at 562.49. It certainly didn't happen in the last 30-minute period, but the OEX's pullback has so far been only into the 560.80-ish support level (being tested again as I type), and it did close the last 15-minute period just barely above the Keltner support I'd mentioned earlier. It's hanging on, but just barely. Again, I consider this a countertrend bounce only and a risky long trade and not one I would have recommended, but am following this for the benefit of those who might be in a long trade or for those who want to see a bounce for a new bearish entry.

Jeff Bailey : 9/22/2005 10:28:09 AM

Bullish swing trade raise stop alert ... for Valero Energy (VLO) $116.06 +2.58% ... to $112.45.

Jeff Bailey : 9/22/2005 10:25:15 AM

10:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 10:25:00 AM

Advdec line pulling back to potential support now, at -1650 to -1460. It's at -1378 as I type. The pullback isn't severe yet, but has brought the OEX back to retest that former Keltner resistance now converted to possibly weak Keltner support. That support is at 561.20-561.50, on 15-minute closes. OEX at 561.59 as I type. In other words, a continuation of the countertrend bounce still remains possible.

Jonathan Levinson : 9/22/2005 10:19:07 AM

In all the excitement, I missed the volume breadth measures, which are incredibly underwhelming: -1.22:1 for the NYSE, +1.1:1 for the Nasdaq. Wish I had my short back.

Linda Piazza : 9/22/2005 10:17:09 AM

The advdec line is now moving into that zone that I noted should be watched. An advdec line move above about -550, if sustained, could suggest that this countertrend rally could be sustained a bit longer. A strong downturn in the advdec line could suggest otherwise.

Jonathan Levinson : 9/22/2005 10:16:33 AM

I agree, Mark- just that it's very strong. The daily and weekly charts are very bearish, the yield curve is flattening, there's Rita, there's negative savings, a tightening Fed, etc. I'm bearish overall. But those intraday cycles are getting great traction so far.

Linda Piazza : 9/22/2005 10:15:05 AM

The OEX may well produce that 15-minute close above the Keltner zone currently at 561.43-561.47, the first time the OEX has closed above one of those lines since Tuesday afternoon. That sets a potential upside target of 563.24-564.34, so essentially a test of the five-minute 100/130-ema's at 563.41 and 564.21. Keltner support is tentative, however, still sloping strongly downward, and could still be retested. There's a potential inverse H&S setting up, so a pullback from those averages, back down to the 560.80 area, could be an attempt to form a right shoulder.

Jonathan Levinson : 9/22/2005 10:14:24 AM

That blast higher off the lows was clearly impulsive, high volume and vertical price action, while the pause at the highs feels corrective. A lot of resistance was cleared easily by that rise. Bears need to get back below 38.55 to avoid getting Pamplona-ed by the bulls. Link

Jonathan Levinson : 9/22/2005 10:12:06 AM

QQQQ - Exit Point Alert -

Stopped Out QQQQ short at 38.66

Linda Piazza : 9/22/2005 10:11:52 AM

The RLX has now retraced all of yesterday's losses. No guarantee that this bounce will hold, but those trying to gain an outlook on the OEX's actions might watch the RLX for continued gains or a rollover.

Jonathan Levinson : 9/22/2005 10:09:01 AM

QQQQ - Stop Loss Adjustment Alert -

QQQQ short at 38.66, stop to breakeven

Linda Piazza : 9/22/2005 10:08:38 AM

Pay special attention to the advdec line at -1030 to -550, as the action there might give clues as to whether the bounce is going to continue or stall. These are QCharts advdec values. Advdec line now at -1486.

Jonathan Levinson : 9/22/2005 10:07:40 AM

GOOG continues its moonshot, up 2% to 318.15 here.

Jonathan Levinson : 9/22/2005 10:06:24 AM

Thanks, Mark. We're about to find out if it was in the right or wrong direction for the day, I think.

Linda Piazza : 9/22/2005 10:06:12 AM

OEX bulls want to see a 15-minute close above Keltner resistance currently at 561.35-561.49, with this resistance proving problematic for the OEX yesterday afternoon during its bounce attempt. Once above this, resistance thins, but the former resistance will be converted to weak support only, so the picture remains mixed. Still, this is the beginning of what those who wanted to see a bounce wanted to see happen.

Jeff Bailey : 9/22/2005 10:04:57 AM

Sell Program Premium ... DIA $013.89, SPX 1,211.49, QQQQ $38.58

Jeff Bailey : 9/22/2005 10:04:27 AM

10:00 Market Watch found at this Link

Linda Piazza : 9/22/2005 10:03:46 AM

Advdec line is definitely bouncing now, validating the OEX's bounce, too. The OEX is fast approaching the five-minute 100/130-ema's at 563.48 and 564.28, with those being a level of resistance to be watched. OEX at 561.96 as I type.

Jeff Bailey : 9/22/2005 10:03:26 AM

Buy Program Premium ... DIA $104.00, SPX 1,212.79, QQQQ $38.63

Jonathan Levinson : 9/22/2005 10:03:09 AM

QQQQ - Entry Point Alert -

Short QQQQ at 38.66, stop 38.72

Linda Piazza : 9/22/2005 10:02:08 AM

I mentioned utilizing a Fib bracket for the RLX, as of yesterday's close, and believing that it might signify that the RLX had approached a possible limit for its downside move before a retracement, with 415 another. Here's the Fib bracket as of yesterday's close. Note how closely the consolidation zones match up with important Fib levels. This is sometimes a useful tool, and the bracket can even be extended or fit to certain consolidation zones, to guess where support or resistance might be. Link

Jonathan Levinson : 9/22/2005 10:01:45 AM

QQQQ reaches the top of the 30 min channel here at the pivot, 38.57.

Jonathan Levinson : 9/22/2005 10:01:04 AM





Jonathan Levinson : 9/22/2005 10:00:36 AM

QQQQ is now testing 72 SMA, the key test for the trending 30 and 60 min cycles: Link

Linda Piazza : 9/22/2005 9:58:00 AM

The RLX continues its bounce. The OEX is trying to bounce, too, and the advdec line is trying to steady, so there's potential for a bounce to begin now, but not strong evidence yet. Still, the OEX is within a zone that I identified as potential bounce zone. Although it bothers one reader for me to say so, bears, make sure you've made efforts to protect your profits now. Bulls, I don't see evidence as strong as I'd like yet to be sure that bounce is going to be maintained for any length of time and I consider it countertrend anyway, and so a risky endeavor to enter a long play. I'm not recommending it, but will follow what I see as the OEX bounces.

Jonathan Levinson : 9/22/2005 9:56:20 AM

Great entry on NQ, Marc.

Jonathan Levinson : 9/22/2005 9:55:09 AM

My guess is that the Fed's light add and the stop out rate below the target rate should be supportive to the markets. I have little doubt that that's their goal.

Jonathan Levinson : 9/22/2005 9:54:20 AM

The Fed announces a 6.25B overnight repo, for a net add of 1.25B today. The stop out rate was 3.65.

Jonathan Levinson : 9/22/2005 9:52:40 AM

Ten year notes hold a slight gain, TNX -.7 bps at 4.181% ahead of the Fed's repo announcement and the LEI report at 10.

Jeff Bailey : 9/22/2005 9:50:25 AM

Program Trading Levels ... HL Camp & Company has their computers set for program buying at $7.37 and set for program selling at $4.59.

Linda Piazza : 9/22/2005 9:50:10 AM

A fitted Fib bracket on the RLX suggests the possibility that, as the RLX approached 420 yesterday (currently 423.33, off yesterday's 420.72 low), it may have been approaching the limit of the current downside move, before a countertrend bounce. This is in-exact science at best, but it sometimes proves helpful. It's also possible to project an RLX drop down to 415 and have that Fib bracket looks like it fits fairly well with the previously formed consolidation zones, but I'd at least consider the possibility that the RLX bounce, perhaps begun today, may be something to watch when looking for an OEX countertrend bounce, too.

Jonathan Levinson : 9/22/2005 9:45:59 AM

QQQQ 100 tick chart update: Link

Linda Piazza : 9/22/2005 9:45:48 AM

One chart that often has relevance for the OEX is the 240-minute chart, and the Keltner target and support on that chart is 558.73, near that 558.90 actual site of the ascending trendline off the April low. I noted in my first OEX-related post this morning that I would have expected a bounce to begin from somewhere near yesterday's close, down to that 558.90 zone, and so I guess we're going to see if that lower end of possible support is going to hold.

Sure would need to see a turnaround on the advdec line to suggest that such a bounce would begin, though.

Jonathan Levinson : 9/22/2005 9:43:39 AM

And blows clear through it. Volume breadth -1.79:1 for the NYSE, -3.03:1 for the Nasdaq.

Jonathan Levinson : 9/22/2005 9:42:07 AM

QQQQ tests 60 min channel support, with 30 min channel support declining below it: Link

Linda Piazza : 9/22/2005 9:40:17 AM

I'm not liking what I see on the internals yet, at least as far as whether it points to a likely countertrend bounce. Evidence for that bounce is just not there in the way I thought it would be, so I'm suspending judgment as to whether it will occur. This day is setting up more like Monday and Wednesday than like days that typically see early bounces, at least according to the evidence I watch. So, I can't say I have strong faith in that early bounce at this moment. Other anecdotal evidence--the likelihood of a doji or consolidation after such strong declines--still support the idea, but the internals I watch just don't. Not yet.

Jonathan Levinson : 9/22/2005 9:37:48 AM

QQQQ has yet to test its premarket lows at 38.38.

Jonathan Levinson : 9/22/2005 9:35:13 AM

Session low for gold and euros here, session high for GE.

Jonathan Levinson : 9/22/2005 9:33:58 AM

30 and 60 min channel support are down to 38.35-38.37 QQQQ.

Linda Piazza : 9/22/2005 9:33:21 AM

Slightly lower open, one of the possibilities that I expected, and an immediate bounce attempt on the OEX, but the evidence from internals is not as predicting a countertrend bounce as strongly as I expected. Therefore, there's some question about my early scenario for the day. Have to watch a little longer.

Jonathan Levinson : 9/22/2005 9:30:49 AM

Volume breadth is -3.01:1 for the NYSE and -3.76:1 for the Nasdaq at the open.

Jonathan Levinson : 9/22/2005 9:23:22 AM

Here's a map of Rita's projected flight path including Gulf assets and installations: Link

Jonathan Levinson : 9/22/2005 9:21:27 AM



Jonathan Levinson : 9/22/2005 9:21:08 AM

Ten year notes continue to weaken, TNX up to a .5 bp loss at 4.183%. IRX is up 5.1 bps at 3.393%.

Linda Piazza : 9/22/2005 9:15:21 AM

As I've been saying for weeks, the OEX has been following the BIX's example as it moves through its broadening formation, always a step or two behind the BIX. That's what led me to expect a violation of the 200-sma a while ago, for example. After the BIX's violation of its 200-sma, the BIX headed down into a consolidation zone at the bottom of its broadening formation, and then yesterday there was an eventual violation of that broadening zone's descending support line. That suggests the possibility that the OEX could do the same, with the bottom of its broadening formation now at about 547.

However, first there's a potential H&S on the OEX's chart, but one that formed after another consolidation pattern and not after a steep climb. I'm not sure how valid that consolidation zone H&S is, for that reason, but I do expect potential support to kick in near the neckline, even if any bounce might be temporary only. That potential support could be expected anywhere from yesterday's close down to 558.90, the site of the actual ascending trendline off the April low. Based on some considerations, I wouldn't be surprised to see a climb that begins first thing this morning, with that climb being a countertrend move and not a good-risk move for a bullish play. Futures indicate that the open might be a lower open, so if a climb does begin soon, it might be beginning from somewhere near or below yesterday's close. If the OEX doesn't bounce immediately, it may be sinking into stronger support, and those still in bearish plays should follow it lower. I'll have to look at how things set up, but at this point, I'd like to see a bounce before any considered new bearish entries as next support is so close.

If a bounce begins, either from the open or after a dip toward 559, then watch for a rollover, with the 200-ema at 563.59 and the 200-sma at 566.83 being prime spots to watch for a potential rollover.

Keep in mind that we've had some steep declines over three days, and it should be time for some consolidation, perhaps in the form of a bounce that rolls over, perhaps into a doji day.

Linda Piazza : 9/22/2005 9:07:16 AM

Another problem concerned with evacuating the Port Arthur area, at least, is that the refineries and chemical companies are major employers in the area. Those refineries must be shut down before employees can leave, and many are working almost around-the-clock in the shut-down process. At one refinery at least, that process is not expected to be completed until tonight.

Jonathan Levinson : 9/22/2005 9:05:18 AM

QQQQ's decline yesterday results in an oversold trending move for the 60 min cycle, an extremely rare occurrence, and the 30 min cycle as well- the 30 min oscillators turned up, printed buy signals, and are rolling over from just above overbought territory this morning. A bounce is overdue on an intraday basis, which is why I was trying to bottom pick in the last hour yesterday. So far, the daily cycle downphase is overwhelming the intraday cycles. Bulls need a break above 38.55 to turn the short cycle up and stall the 30 min cycle downphase.

Jonathan Levinson : 9/22/2005 8:51:40 AM

The Fed has announced a 9B 14-day repo against the 14B expiring, leaving 5B to address at the 10AM short-term repo announcement. The stop-out rate was 3.64 on treasury and 3.75 on agency collateral.

Jane Fox : 9/22/2005 8:49:37 AM

Dateline WSJ While Hurricane Rita poses a major threat to the nation's oil and natural-gas industries, the storm gathering force in the Gulf of Mexico could have serious economic and environmental consequences for chemical manufacturers on the Texas coast.

More than 160 plants in Texas are in the potential path of Hurricane Rita -- to Port Arthur from Freeport, where the storm is forecast to make landfall, according to the American Chemistry Council. The coastal region of Texas is home to 50% of U.S. chemical-production capacity, making many of the nation's and the world's basic manufacturing building blocks, according to consulting firm Chemical Market Associates Inc.

The industry has been buffeted by soaring prices for natural gas, which is the foundation for many of the chemical products it makes, especially following Hurricane Katrina. Officials at chemical companies like DuPont Co. and Dow Chemical Co. have expressed concern about their ability to compete with producers in countries where natural-gas prices are lower, though other factors like labor costs figure into moves by chemical makers overseas.

Jane Fox : 9/22/2005 8:45:14 AM

TBonds have now fallen and broken overnight support to make new daily lows (based on the 8:20 pit open).

Jane Fox : 9/22/2005 8:40:39 AM

Linda thank you very much for that wonderfully written "picture" of your situation in Texas.

Linda Piazza : 9/22/2005 8:38:04 AM

Here in Texas, we're gearing up for Hurricane Rita, with literally millions trapped on freeways trying to get out of the Gulf Coast area. Galveston, an island, might see storm surges of 30 feet, with the levee wall able to handle only 17 feet and with the highest points of the island only 8 feet above sea level, if I'm remembering my research on my first book correctly. For those not knowledgeable about the Texas Gulf Coast, the Galveston metropolitan area has about 2 million in population, if I'm remembering my figures correctly, and those 2 million are all trying to evacuate through Houston, mostly, a metropolitan area of 4 million and the fourth largest in the nation, also if I'm remembering correctly. Freeway traffic in Houston is horrendous on the best of days, and this is not the best of days. We lived in Houston before moving here to Dallas, and are from the Port Arthur area, so we're in touch with people making the decision to leave or not leave, including close relatives. While mayors are urging evacuation and while many still condemn those who did not leave New Orleans or attribute their failure to leave to poverty, we're hearing from people trapped on freeways, unable to make forward progress, running out of gas, with gas stations along the highways out of gas to refill their tanks. My husband's mother and brother and his family are in low-lying Port Arthur, and were unable to get out before the last hurricane after sitting in their car for many, many hours, and have elected to stay, not even trying because of the traffic reports this time. Last time, Houston wasn't trying to evacuate, too. A friend with a 25-year-old physically disabled daughter does not believe her daughter could weather four hours in a car, much less the twelve it might take to make the normal four-hour drive here to Dallas, so they're staying at the hospital where the friend works, even though that hospital's patients are being evacuated and the hospital itself is already prone to flooding. Even here in Dallas, some warn that the hurricane might still be a Category 1 by the time it reaches Dallas, causing electrical outages and other problems, so no one wants to be trapped on a freeway between the Gulf Coast and the Dallas area as a hurricane roars up Interstate 45.

The potential for damage is severe through a highly populated and developed area, rife with refineries, pipelines and other infrastructure that supplies much of the nation's petroleum and natural gas products. Not good.

Jonathan Levinson : 9/22/2005 8:32:33 AM

QQQQ holds at 38.409 here, TNX -3.1 bps at 4.157% and IRX -3.2 bps at 3.31%. Crude oil is down to a 1.275 gain at 68.075, natgas +.555 at 13.555.

Jonathan Levinson : 9/22/2005 8:30:59 AM



Jonathan Levinson : 9/22/2005 8:30:48 AM





Jonathan Levinson : 9/22/2005 8:16:24 AM

The Fed has 15.25B in various repos expiring today, while the bill pass from yesterday is payable, effectively adding 1.25B and leaving 14B to be addressed. This is a relatively small amount for a Thursday, and we'll get our first hint as to whether the Fed will be adding or draining before 9AM when the 14-day repo is announced.

Jonathan Levinson : 9/22/2005 8:07:05 AM

Longtime subscribers will remember my discussion back when then Dallas Fed chief McTeer told Steve Forbes that gold was "getting topping" around 370, that the Fed would tighten to control its rise, and that a reasonable price level would be in the 350 area. This is an example of the potential for divergence between central bank assertions and reality. The Fed is but one, admittedly very powerful, player in the very deep waters of global finance. The tide can be briefly diverted by these players, but not forever.

Jonathan Levinson : 9/22/2005 7:57:42 AM

Equities are down, ES trading 1213.75, NQ -3.5 at 1571, YM 10397 and QQQQ -.07 at 38.43. Gold is up 7.10 to 477.20, silver +.09 to 7.47, ten year notes +25/32 at 111 1/2, crude oil +1.325 at 68.125 and natgas +.66 at 13.66.

We await the 8:30 release of Initial Claims, est. 450K, and at 10AM, Leading Economic Indicators, est. -.3%.

Linda Piazza : 9/22/2005 7:00:10 AM

Good morning. The Nikkei closed lower as did most other Asian markets. Many European markets are pressured lower by higher crude costs, with the FTSE 100 kept in modestly positive territory by its oil majors. As of 6:51 EST, crude was higher by $0.95, to $67.75. Our futures were modestly lower at that time. More detail about Asian and European markets follows in succeeding paragraphs.

The Nikkei gapped lower by more than 75 points Thursday morning and moved lower still, but managed to end the day down by only 37.21 points or 0.28%, at 13,159.36. Still, one day ahead of Friday's holiday, it could not stay above the 13,180-13,225 resistance level noted by some as more important than the psychological 13,000 level. The August trade surplus decreased 79.7% from the year-ago level, far more than had been expected, with crude costs sending import costs up 21.1%, way above the expected 14.5% gain. Exports rose, too, by 9.1%, beating the 8.5% expectation. Still, with rising crude costs and the poor performance of the U.S. bourses, exporters were early decliners, including Sony, expected to release a restructuring report after the close.

Most other Asian markets declined, with South Korea's an exception. The Taiwan Weighted lost 1.57%, but South Korea's Kospi, on an upward tear lately, rose 0.28%. Singapore's Straits Times dropped 0.35%, and Hong Kong's Hang Seng fell 0.29%. China's Shanghai Composite lost 2.36%. As-yet-unsubstantiated rumors float through the forex markets that China no longer wants to hold U.S. treasuries as part of its forex reserves, with the statement reportedly coming from the deputy minister of the Central Policy Research Office who was speaking at a seminar. Although the dollar did temporarily move lower against the yen and euro after the rumors were floated, its choppy consolidation shows that forex players aren't yet convinced that the U.S. treasuries will be dumped. The deputy minister reportedly thinks it better for China to hold more shares of foreign energy resources, but this minister is not a monetary official.

Many European markets decline as crude rises, although the FTSE 100 is an exception. A rise in the oil majors is helping the light-on-techs FTSE 100 perform better than other European bourses. In a sector-by-sector breakdown of European performance on CNBC Europe this morning, the insurance sector was being pegged as the biggest decliner.

In the U.K. September's CBI industrial trends survey showed orders balance rising to -27 from -29, still below the expected rise to -25. Export orders fell to -25 from -17. Expectations, however, climbed to +6 from the previous +3. Domestic price expectations stayed at the same -8.

July's industrial orders for the twelve EU countries dropped 1.6% month over month from an unchanged June number, with the decline larger than expected. Transport orders dropped, as did that for electrical and optical equipment. Country-by-country, Germany's performance was the strongest of the countries, with France and Portugal the weakest. Orders there dropped 2.8% and 3.4% month over month, respectively. Reuters reported that Italy's economic minister has resigned, and that Prime Minister Berlusconi will temporarily take over the duties of this official. Italy's September consumer confidence rose to 102.8, more than expected with crude prices and a possible Bank of Italy scandal likely impacting sentiment. One source calls the increase broad-based, but notes that 76% of the survey's respondents said they have no plans to purchase durable goods in the next year.

Stock-specific news included declines by France's spirits group Pernod Ricard after the company disappointed in its H1 earnings report and British aerospace and medical products group after it also disappointed when reporting fiscal 2005's cash generation. Merrill Lynch upgraded Spain's Inditex, owner of Zara fashion stores, to a buy from its previous neutral rating, and the stock rose. The U.K.'s telecommunications company BT Group PLC announced that it would establish a business meant to permit all telecom providers in the U.K. to have equal and transparent assess to local BT networks. BT's shared inched lower.

As of 6:51 EST, the FTSE 100 was higher by 3.90 points or 0.07%, at 5,373.60. The CAC 40 was down by 32.36 points or 0.72%, to 4,435.70. The DAX was lower by 33.12 points or 0.68%, at 4,842.10. The DAX tried all Monday and Tuesday to close the huge gap down Monday morning, after the weekend's election, but couldn't do it, and now has fallen this morning to the lows of the week, coiling there.

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