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Tab Gilles : 10/6/2005 12:05:38 AM

Storm Cat Energy (SCU) also (SME.V) Link Link Link

Tab Gilles : 10/5/2005 11:11:26 PM

Materials Select Sector (XLB) Link Link Link

Tab Gilles : 10/5/2005 11:02:57 PM

$COMPQ/$NAHL/$NASI Link $BPCOMPQ Bear correction Link

Tab Gilles : 10/5/2005 10:57:13 PM

$SPX Follow up to 10/4 10:48PM post on $SPX where I highlighted a Rising Wedge on the weekly chart with a bearish divergence. Link Link

$BPSPX Bear Alert Link $VIX Link

OI Technical Staff : 10/5/2005 9:59:59 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

Disclaimer: Stocks discussed in the Market Monitor are for educational purposes only and any analysis is not meant to imply a recommendation for or against that stock. The analysts in this forum as on any other website are prohibited by the SEC from giving any specific advice to ANY individual trader. All information posted is for ALL readers and is not meant to be directed to any individual. Our analysts cannot answer any email questions regarding any specific stock. Please do not ask and please do not take offense if requests are denied.

Results posted in the Market Monitor are hypothetical and OIN does not claim that any reader achieved these exact results. Due to the lag time between research, writing, posting, uploading, reading and execution there will be differences between the actual signal given and the fill achieved by the reader. Fills may be better or worse but in most cases they will be different. The writers will make every effort to give advance notice of intended signals and indicate potential price targets. Your individual results may vary depending on your activity level and aggressiveness. This forum is intended as an education service only. Trading involves risk and should not be attempted by anyone not ready to accept this risk. By acting on any signal in this forum you agree and personally accept this risk.

Tab Gilles : 10/5/2005 8:10:08 PM

Nasdaq Summation ($NASI) After yesterday's close the $NASI gave a weekly buy signal, thus before today's close I entered from a 1/2 UOPIX (Profund UltraOTC fund) to a full position. Having entered on 10/3 @ $23.56 and tonights NAV of $22.66; average cost basis $23.11 Link Link

Now, after the close tonight the $NASI has reverted back to SELL bear mode on the weekly chart. Link

Looking at the daily $NDX chart it's right at the rising tredline. Link

$NDX support on BB is around 1550. Link

So, does one sell with both daily and weekly $NASI after the close today both giving a bearish sell? Link Link Link Like I stated earlier today...I'm seeing the same whipsaw moves as we did back in early Feb/March. More than likely we'll see a bounce hopefully Thursday and, BUT I'll be switching out of UOPIX back into USPIX.

Jeff Bailey : 10/5/2005 4:42:00 PM

Closing Market Watch found at this Link

Jeff Bailey : 10/5/2005 4:37:39 PM

Closing Internals found at this Link

Tab Gilles : 10/5/2005 4:34:28 PM

Murphy Oil (MUR) Link Link

Tab Gilles : 10/5/2005 4:10:36 PM

Nasdaq100 ($NDX) Link

Jeff Bailey : 10/5/2005 4:17:46 PM

Current OPEN MM Profiles found at this Link ... Today's Activity .... Swing trade shorted shares of Valero Energy (VLO) at the bid of $111.71. Covered 1/2 at $107.61 ($+4.10, or +3.67%) and the other 1/2 at $107.75 ($+3.96, or +3.54%).

Closed out (bought back) the naked SMH Oct. $37.50 Calls (SMH-JU) at the offer of $0.25 ($+0.05, or +16.67%)

Jonathan Levinson : 10/5/2005 4:04:40 PM

Headlines:

NYSE DECLINERS OUTNUMBER ADVANCERS 27 TO 6

NASDAQ DECLINERS OUTNUMBER ADVANCERS 4 TO 1

Linda Piazza : 10/5/2005 3:59:11 PM

The TRAN looks as if it will end the day below its 200-sma, but right at daily Keltner support (difficult to tell exactly because of those missing daily bars on my charting service).

Jonathan Levinson : 10/5/2005 3:58:36 PM

The SOX has yet to break to a new low here, clearly stronger than QQQQ and a possible bullish divergence. Link

Linda Piazza : 10/5/2005 3:49:52 PM

The OEX is dropping below that 7/07 low, but I'm wondering if it didn't just overrun targets a little as bulls realize that there's not going to be a bounce to get them out of trouble today.

Jonathan Levinson : 10/5/2005 3:47:23 PM

QQQQ has lost the 21 day EMA and tests 50 day EMA support here. The daily cycle is stalling but has not yet turned, but it's looking clear that yesterday's failed intraday spike and gravestone doji close marked the end of the daily cycle upphase. The 30 min cycle bounced and is turning down now, far too slowly- that sets up a possible bullish divergence, if the price reverses back up. Currently the action is walking down the lower 30 min and 60 min channels, and the 30 min oscillators aren't oversold anymore. 100 tick chart at this Link

Tab Gilles : 10/5/2005 3:44:57 PM

Yesterday the weekly $NASI gave a BUY signal. I'm adding to a full position on the UOPIX today, based on closing NAV. Link

We could be getting the same whipsaw moves as we did back in early Feb/March. But Until there's a sell signal the chart tells me to go long. Link

Marc Eckelberry : 10/5/2005 3:42:39 PM

I want you to program the INTC 22.50 January calls and wait for my signal. I expect the DOW to hit 10285 this week and that would be a start.

Jonathan Levinson : 10/5/2005 3:39:33 PM

Volume breadth is -3:1 on the Nasdaq, -8.75:1 on the NYSE.

Jonathan Levinson : 10/5/2005 3:37:55 PM

New session low below S2, 30 min channel support down to 38.80: Link

Jeff Bailey : 10/5/2005 3:37:49 PM

Dow Diamonds (DIA) $103.43 -0.71% ... gets the trade at WEEKLY S2.

Linda Piazza : 10/5/2005 3:37:03 PM

The OEX is now approaching the 7/07 low of 553.50. I consider the OEX as having confirmed a H&S on the daily chart, probably eventually headed into a drop to the bottom of its broadening formation, following the BIX's example, but this would be a natural point from which the OEX might attempt a bounce. I'm not so sure that we'll get much of a bounce today, so I'm absolutely not suggesting a bullish entry now. What I am suggesting is that you consider this possibility as you make your end-of-day decisions. I would consider any bounce a countertrend one.

Jonathan Levinson : 10/5/2005 3:31:03 PM

If S2 fails and the 30 min cycle begins trending, next confluence support is at 38.60 QQQQ. 1st sign of trouble for bears will be a break back above 38.97-39.00. Link

Jeff Bailey : 10/5/2005 3:30:44 PM

VIX.X alert 14.07 +6.59% ... Back above WEEKLY R2

Linda Piazza : 10/5/2005 3:27:37 PM

As well-shaped as that OEX potential inverse H&S looked to be at the time, I just didn't have faith in the formation confirming or meeting an upside target. I should have gone ahead and suggested that aggressive bears consider a new entry (see my 1:37:11 post) despite the advdec line's failure to rise high enough that I thought oversold pressures were released. I suspected it might be one of those down-all-day days, but didn't want to chase a too-risky new bearish entry. Doesn't look too risky at this point, though, does it?

If you kept a partial position today, you're feeling good. If you considered yourself conservative and took full profit before the inventories number along with me, rather than taking the recommended partial-profit route, you're probably not too happy right now, but this is the very risk I outlined to exiting that position. Some are unhappy with me for always listing risks, labeling that kind of commentary inconclusive, but this is the reason why I want to tell you the full story and let you make up your own minds. I'm happy to have collected an early profit today, but only you know how to weigh those risks for yourselves.

Jeff Bailey : 10/5/2005 3:26:56 PM

AMR Corp. (AMR) $11.57 (unch) ... wild

Jeff Bailey : 10/5/2005 3:25:28 PM

And it isn't much, I might add.

Jonathan Levinson : 10/5/2005 3:25:10 PM

QQQQ takes out the lows, the 30 min channel turning back down after a weak and brief upphase. S2 at 38.85 is in play here. Link

Jeff Bailey : 10/5/2005 3:24:56 PM

S&P Banks Index (BIX.X) 331.35 +0.08% ... only equity-based sector I currently show in the green.

Jeff Bailey : 10/5/2005 3:22:32 PM

Dow Industrials (INDU) 10,361 -0.77% ... gets the trade at WEEKLY S2.

Jonathan Levinson : 10/5/2005 3:20:14 PM

QQQQ's short cycle is entering oversold territory, but has stalled the 30 min cycle upphase in the process. For the second day in a row, we have a lower low and lower high for QQQQ, following yesterday's big gravestone doji. I have very few bullish thoughts here despite the possible reverse h&s described earlier. Below 38.90, it will be invalidated. Link

Linda Piazza : 10/5/2005 3:14:36 PM

The TRAN is dropping again, but it's dropping into its own possible version of an inverse H&S. If it drops much more than the current 3656.70 level, however--say through 3650, it may be invalidating that potential inverse H&S.

Jeff Bailey : 10/5/2005 3:14:06 PM

03:00 Internals found at this Link

Linda Piazza : 10/5/2005 3:09:16 PM

Nearest Keltner support for the OEX is at 556.23 on 15-minute closes, and nearest resistance at 557.11 on 15-minute closes, with both still moving down strongly and pressuring the OEX lower.

Jonathan Levinson : 10/5/2005 3:08:49 PM

Volume is 2M shares shy of the 85.4M shares traded on QQQQ yesterday, above the 78.9M share average. Breadth remains amazingly negative at -5.3:1 on the NYSE- the last time we saw such imbalance, it was on the plus side, and it didn't last nearly as long as this sustained selloff is lasting on the NYSE. On the Nasdaq, it's negative but less so at 2.13 declinign shares for each advancing.

Jeff Bailey : 10/5/2005 3:03:19 PM

03:00 Market Watch found at this Link

Linda Piazza : 10/5/2005 3:00:39 PM

The OEX has been bouncing around within a slightly widening but narrow range since about 12:30. It's difficult to pinpoint an upside breakout or a downside breakdown under those conditions, but it looks vulnerable on a Keltner basis to just sliding down along a descending support line currently at . . . well, there it went. It could be headed toward a retest of the day's low. Couldn't type fast enough.

Jonathan Levinson : 10/5/2005 2:54:53 PM

QQQQ continues to bounce along the 72 SMA. Bears need to break it down to avoid a rising set of lows below 39.20. Link

Linda Piazza : 10/5/2005 2:53:18 PM

Advdec line dropping again, not yet at a new LOD, but how low can it go, after all? It's already at an extreme level. The important point is that it's not accompanying any tentative rises in the equities by rising itself.

Jonathan Levinson : 10/5/2005 2:44:23 PM

Volume breadth -4.49:1 on the NYSE, -1.73:1 on the Nasdaq.

Linda Piazza : 10/5/2005 2:40:05 PM

I just didn't have good feelings about the likelihood of that OEX inverse H&S confirming or going far if it did. The OEX is back at the right shoulder level again, with the 557.68-ish Keltner resistance having held except for a minimal close a few cents above it. Next support is at 556.41, but still turning down strongly. While I could a possibility that there's not much more downside and the OEX could just chop around near here, I'd be surprised to see too much upside movement, either. The wild horse in that is the TRAN, having bounced strongly and now trying to steady just below a 38.2% retracement of the steep decline off yesterday's high.

Jeff Bailey : 10/5/2005 2:39:19 PM

AMR (AMR) $12.00 +3.45% ... has "rocketed" from $11.40 in last 30-minutes.

Jeff Bailey : 10/5/2005 2:32:38 PM

IBM (IBM) $80.39 +0.34% .... inches green.

Jeff Bailey : 10/5/2005 2:30:37 PM

QQQQ $39.13 -0.43% ... tested MONTHLY Pivot for second-time this afternoon. Hasn't been able to get through.

Jeff Bailey : 10/5/2005 2:29:37 PM

Dow Diamonds (DIA) $104.07 -0.09% ... went green earlier this morning and sellers "whacked" it back to a session low of $103.76.

Bears have to be thinking ... "it better not go green again."

Jonathan Levinson : 10/5/2005 2:28:18 PM

Crude oil trying a bounce, -1.05 at 62.85, 17.5 cents off the intraday low. Natgas is down .055 at 14.155 here.

Jeff Bailey : 10/5/2005 2:28:08 PM

SMH $36.27 -0.65% ....

Jeff Bailey : 10/5/2005 2:27:47 PM

Bearish naked call close out alert ... for the Semiconductor HOLDRs SMH Oct. $37.50 Calls (SMH-JU) at $0.25.

Jonathan Levinson : 10/5/2005 2:25:34 PM

Here's a 3-day view of QQQQ with that reverse h&s setup: Link

Linda Piazza : 10/5/2005 2:24:30 PM

The advdec line is bouncing, but absolutely not yet to the degree that some indices are bouncing. Compared to the OEX, for example, it's not even approaching the same Keltner resistance lines yet, much less breaching the first one to the topside, as the OEX has done. If you're long or hoping to be, keep those stops tight because I wouldn't be surprised to see the bounce attempt fail at some point. If you're bearish, don't take that as advice to ignore your stops.

Jeff Bailey : 10/5/2005 2:23:12 PM

JDS Uniphase (JDSU) $2.34 +4.00% .... after session low of $2.12.

ADC Telecom (ADCT) $19.20 -15.30% ... after gap lower morning low of $18.01.

Jeff Bailey : 10/5/2005 2:17:37 PM

SPX 1,207.45 -0.57% ...

Jeff Bailey : 10/5/2005 2:17:02 PM

Valero Energy (VLO) $105.95 -5.91% ... was "hoping" for a pop back to $110.

Session low/high now ... $105.20 - $113.60.

Linda Piazza : 10/5/2005 2:16:36 PM

Keltner resistance at 557.66 on a 15-minute closing basis for the OEX. The neckline of that inverse H&S is somewhere between 558 and 558.30, depending on how its drawn. The OEX is rising to test both, with that Keltner line turning it back a few minutes ago. Bears, watch for confirmation of that inverse H&S and adhere to your stops, if they're hit. You've had a good run today. Don't let the play go bad. Bulls, if any are trying a bullish play, be careful of a tepid confirmation and then a quick turnaround. I have not recommended a bullish play because it's just too risky.

Jeff Bailey : 10/5/2005 2:12:11 PM

02:00 Internals found at this Link

Jonathan Levinson : 10/5/2005 2:09:34 PM

With the short cycle oscillators in a new rollover and channel support from 38.88-38.93, this is a risky level from which to try a long to catch a possible reverse h&s. The maximum symmetrical right shoulder bottom would be at 38.99ish, and a dip to that level could accomodate a tight downside stop. If the short cycle downphase in play here goes nowhere, that would be another signal to get long for a stronger bounce. Link

Jonathan Levinson : 10/5/2005 2:04:43 PM

Volume breadth -4.53:1 on the NYSE, -1.9:1 on the Nasdaq.

Jeff Bailey : 10/5/2005 2:02:06 PM

02:00 Market Watch found at this Link

Linda Piazza : 10/5/2005 2:01:35 PM

The OEX's potential inverse H&S is beginning to extend a little too far to the side. Are bulls losing strength? On a Keltner basis, the OEX keeps finding resistance so far on 15-minute closes at a Keltner line currently at 557.77, but it may be trying to firm up support now at one at 556.72. That inverse H&S still has a chance, although I still don't put a lot of faith in it. On a day like today, surprised bulls have been waiting all day for a decent bounce on which to exit their positions, and they may keep the pressure on if there's any attempt to rise.

Jonathan Levinson : 10/5/2005 1:58:18 PM

If the bulls can hold these lows, then QQQQ could be putting in a right inverse shoulder below a 39.20 neckline: Link

Jonathan Levinson : 10/5/2005 1:49:25 PM

Session low for crude oil here, -.75 at 63.15.

Linda Piazza : 10/5/2005 1:47:30 PM

The OEX is still trying to firm up that potential inverse H&S. I still don't have a lot of faith in the formation going much of anywhere, but that's just a gut reaction, as it's a nicely formed formation so far.

Jonathan Levinson : 10/5/2005 1:46:23 PM

Ten year notes are bouncing from a higher low, with TNX down 2.2 bps at 4.354%. IRX is down 3.8 bps at 3.497%.

Linda Piazza : 10/5/2005 1:37:10 PM

Remember that we're entering a stop-running period of day in a few minutes. This occurs as the OEX tested the neckline of a potential inverse H&S and now drops back a little, toward the right-shoulder level. If the advdec line had been higher into next clear resistance, I would probably even have suggested that aggressive bears consider a new bearish entry as Keltner resistance just above 558 was tested, if they had the ability to buy deep enough ITM and had good scalping skills, but the advdec line just won't bounce enough to give those signals for new entries after the one given at the open. It's too risky where the advdec line is now.

Bears don't want any kind of stop run to the upside, of course, but bulls want to be wary of any tentative confirmation of that inverse H&S that's quickly reversed.

Linda Piazza : 10/5/2005 1:31:09 PM

The OEX approached the neckline area for its potential inverse H&S, as well as Keltner resistance, and was immediately knocked back. The advdec line hasn't been knocked back too far yet, though, so that 558.39-ish neckline area and slightly lower Keltner resistance may be challenged again.

Jeff Bailey : 10/5/2005 1:25:42 PM

SPX 1,209.04 -0.44%

Jeff Bailey : 10/5/2005 1:25:17 PM

VIX.X alert 13.33 +1.21% .... did trade near that magic "14" level. Pretty good reversal going on here.

sssssnifffff

Jonathan Levinson : 10/5/2005 1:24:21 PM

QQQQ has popped above its 39.11 resistance, testing 30 min channel resistance here 3 cents below the 60 min channel top. The bulls are going to have to mean business to break 39.20, particularly with the short cycle indicators overbought: Link

Linda Piazza : 10/5/2005 1:22:40 PM

OEX still working on that potential inverse H&S, headed up to the neckline at about 558.39, but with Keltner resistance at 558.11-558.33 on 15-minute closing basis. Then there should probably be a pullback toward the right-shoulder level before we know whether it's going to be confirmed or not. I'm not going to be betting that it is, not on a day like this. Current bears, you've had plenty of time to contemplate where your stops should be, so adhere to them.

Jeff Bailey : 10/5/2005 1:21:52 PM

01:00 Internals found at this Link

Note: NYSE Daily NH/NL ratio very "oversold" at 15.6% currently. NASDAQ Daily NH/NL ratio currently 34.6%, which is same as closing reading found on 09/21/05.

Linda Piazza : 10/5/2005 1:11:46 PM

The TRAN is bouncing, its biggest white candle all day on the 15-minute chart, although that's not saying much since white candles have been few and fear between.

Linda Piazza : 10/5/2005 1:10:31 PM

The OEX still looks as if it's working on that potential inverse H&S, but at this point, I still don't have a lot of confidence in it confirming or reaching any upside target that might be set.

Jeff Bailey : 10/5/2005 1:06:28 PM

Bearish swing trade stop alert ... for the remaining 1/2 position in Valero Energy (VLO) $107.75 -4.24%

Jeff Bailey : 10/5/2005 1:03:21 PM

01:00 Market Watch found at this Link

Jonathan Levinson : 10/5/2005 1:03:05 PM

Volume breadth has recoverd to -4.75:1 for the NYSE and -1.89:1 for the Nasdaq, still very weak. QQQQ is testing 39.11 resistance here, trying for a possible reverse h&s bottom which, so long a s the 38.95-39.00 level doesn't get breached from here, could project to an implied target around 39.30: Link

Jeff Bailey : 10/5/2005 12:56:20 PM

Restaurant stocks rather strong today and bucking trend. Will monitor today's unleaded settlement closesly. $1.97 has been the "magic" number of support dating back to October contract.

Jeff Bailey : 10/5/2005 12:53:10 PM

Bearish swing trade lower stop alert ... for Valero Energy (VLO) $106.88 -5.01% .... to $107.75.

Session low/high so far $105.65/$113.60.

WEEKLY Pivot Levels ... $104.14, $108.54, Piv= $112.89, $117.29, $121.64.

Linda Piazza : 10/5/2005 12:40:29 PM

Back. The OEX made it back above that five-minute 21-ema that had turned it back earlier, and may still be trying to form an inverse H&S with a neckline at about 558.39, with the head at the day's low and with a right shoulder still to be formed. On a Keltner basis, though, the OEX tests 557.19 resistance and so far, hasn't been able to close a 15-minute period above it all day. As I said earlier, I don't have a lot of confidence at this point that the H&S will be confirmed or meet its upside target, but I'm watching it. The RLX is attempting to form a double-bottom, but shakily so far, having just tested the 430.68 level that's been resistance all day on 15-minute closes, with stronger resistance at 431.52.

Jonathan Levinson : 10/5/2005 12:34:42 PM

QQQQ is breaking 72 SMA resistance for the first time today on a move above 39.05. Link

Jonathan Levinson : 10/5/2005 12:25:21 PM

Stepping away for 10 minutes.

Linda Piazza : 10/5/2005 12:24:04 PM

Still caught on the telephone. RLX still testing an equal low level. The OEX tests the five-minute 21-ema at 556.89 that turned it back earlier.

Jeff Bailey : 10/5/2005 12:19:42 PM

12:00 Internals found at this Link

Jonathan Levinson : 10/5/2005 12:14:24 PM

DTN reports -6.08:1 for the NYSE here, -5.13:1 for the Nasdaq. TRIN is 1.58, TRINQ 1.54, neither Arms index at "extreme" levels, though this is the worst volume breadth I've seen in many moons.

Jonathan Levinson : 10/5/2005 12:09:45 PM

QQQQ's 30 and 60 min channels continue lower, with support down to S2 in the 38.86 area: Link

Jeff Bailey : 10/5/2005 12:05:36 PM

12:00 Market Watch found at this Link

Linda Piazza : 10/5/2005 12:01:12 PM

Stepping away for a few minutes.

Linda Piazza : 10/5/2005 11:58:48 AM

The advdec line is at a level not seen since January 4th, near the close that day, and there's still no bounce in sight. The OEX, however, is trying to steady again, and the RLX finally did that retest of the previous LOD that I've been expecting, and mentioned as a possibility earlier today. The outcome of that test isn't yet known, but there's a small bounce attempt going on now.

Linda Piazza : 10/5/2005 11:53:44 AM

Another new LOD on the OEX.

Linda Piazza : 10/5/2005 11:52:54 AM

There's nothing new to do if you're in a bearish OEX play. Just keep following the OEX lower with your stops. Unfortunately, there's not been enough of a rise to offer a new bearish entry.

Jonathan Levinson : 10/5/2005 11:52:45 AM

Volume breadth is down to -6.61:1 on the NYSE, -3.73:1 on the Nasdaq.

Linda Piazza : 10/5/2005 11:51:46 AM

The advdec line still heads lower.

Jonathan Levinson : 10/5/2005 11:51:08 AM

The Amex Oil Index ($XOI) has fallen off a cliff since yesterday, currently -2.68% at 1011.15 off a low of 1006.88.

Linda Piazza : 10/5/2005 11:47:12 AM

There's the potential for an inverse H&S on the OEX's 15-minute chart, with the head at the day's low, the one completed shoulder at 556.87 and the neckline at 558.39. Watch for the possibility the OEX might rise toward 558.39 and pull back from there, into the 556.90-ish zone to form a right shoulder, before you know whether the formation will be rejected or confirmed. If confirmed, the upside target would be up near the 561.23 level that's the 38.2% retracement of the entire bear-market decline. It's amazing how often that number comes up even years later in S/R computations through a variety of means.

I'm not particularly confident that this formation will confirm, much less meet its upside target. It's just a sign that bulls are trying here. That's all.

Jonathan Levinson : 10/5/2005 11:45:50 AM

Gold has retraced quite a bit in the last few days. Where do you think GC and XAU will bottom out, before the next leg up?

On GC, the 30 and 60 min cycles are trying to bottom right now, but the daily cycle is in a new downphase that has first support at 464, but first confluence at 448-452. Bulls would prefer to buy a test of that lower level for anything more than tight-stopped scalps. Because the weekly cycle is still rising but approaching overbought, any buys above that 448-452 would need to be kept on a tight leash. If the weekly turns down to join the daily cycle, it could get ugly for bulls.

On the XAU, that first confluence support is at 100, and the rollover looks worse, launching from a bearish divergent daily cycle downphase that's in its very early stages. Below 100, look for support at 90-92, 84 and 78-80.

Jeff Bailey : 10/5/2005 11:40:56 AM

Bearish swing trade cover 1/2 bearish position ... for Valero Energy (VLO) $107.61 -4.36% here.

Jonathan Levinson : 10/5/2005 11:36:04 AM

QQQQ 30 min support holds at 38.92, 4 cents above S2: Link

Jeff Bailey : 10/5/2005 11:35:26 AM

EIA Weekly Crude Oil, Gasoline, Distillate Table at this Link

Linda Piazza : 10/5/2005 11:35:17 AM

So far, a higher low rather than a lower low on the RLX. TRAN just keeps heading lower, though, with its LOD so far less than 8 points above the 200-sma.

Linda Piazza : 10/5/2005 11:33:05 AM

If you took only partial profit from your bearish OEX entry today, you're liking what you're seeing now with the OEX breakdown out of the latest little bear flag. There's tentative price/RSI bullish divergence, though, the same kind that's been setting up all day on the advdec line. It's not meant anything so far on either index, but warns, still, that you need to keep lowering those stops and evaluating how much of a bounce you're willing to sustain. I think it likely now that we could have a trending-down day all day with no new entries offered for those who opted to take full profit with me, but I would not chase an entry with the advdec line at such extremes.

Jeff Bailey : 10/5/2005 11:30:53 AM

Sell Program Premium ... DIA $103.97, SPX 1,205.74, QQQQ $39.00

Jonathan Levinson : 10/5/2005 11:29:41 AM

Volume breadth -5.01:1 on the NYSE, -2.16:1 on the Nasdaq.

Linda Piazza : 10/5/2005 11:29:25 AM

The OEX broke down out of that bear flag and has just hit a new LOD. The RLX holds on better, though.

Jonathan Levinson : 10/5/2005 11:28:19 AM

Session low for crude oil here, -.575 at 63.325. Natgas is up .125 at 14.35.

Linda Piazza : 10/5/2005 11:27:13 AM

The advdec line still can't climb. The OEX remains within a rising regression channel established off this morning's low, however. It needs to climb a bit higher to give a new bearish entry, especially with daily Keltner support at the day's low.

Jonathan Levinson : 10/5/2005 11:24:46 AM

QQQQ's 30 min cycle indicators are looking like they bottomed on the 38.98 print, while the 60 min continues lower. With declining 72 SMA resistance being tested at 39.16 now, my guess is that sideways consolidation here would permit the 60 min to begin its turn (the "weightless" period as that broad channel reverses). But for that to occur, the current lows need to hold. Updated 100-tick chart at this Link

Linda Piazza : 10/5/2005 11:20:01 AM

Here are some Fib levels for you to watch: the OEX's 19.1% retracement of the steep decline off the week's high is at 559.15 and the 38.2% at 561.44. The 50% is at 562.85. As often happens, the RLX is leading the way for the OEX, already above the 19.1% retracement, trying to rise above Keltner resistance at 431.55 on a 30-minute closing basis, with the RLX currently at 432.55.

Jonathan Levinson : 10/5/2005 11:15:25 AM

Session high for GE here, +.17 at 33.02.

Jeff Bailey : 10/5/2005 11:14:13 AM

11:00 Internals found at this Link

Linda Piazza : 10/5/2005 11:14:51 AM

The advdec line isn't mustering a bounce yet. That makes the RLX and BIX bounce attempts somewhat suspicious, but I'm waiting to see if the advdec line is pulled up by the equities, instead of the other way around.

Linda Piazza : 10/5/2005 11:13:03 AM

RLX still trying to climb in a possible bear flag.

Linda Piazza : 10/5/2005 11:05:12 AM

The RLX continues its bear-flag-like bounce. It's testing potentially strong resistance, though, near the 19.1% retracement of its dropoff the week's high. This could be a point at which it pulls back to retest the LOD.

Linda Piazza : 10/5/2005 11:03:21 AM

On the five-minute chart, the advdec line is beginning to show bullish value/RSI divergence. It's not bouncing, though.

Jonathan Levinson : 10/5/2005 11:03:04 AM

Third that, Mark.

Jeff Bailey : 10/5/2005 11:02:57 AM

11:00 Market Watch found at this Link

Linda Piazza : 10/5/2005 11:01:18 AM

Advdec line hasn't mustered a real bounce yet, and neither has the OEX, but the RLX and BIX are still trying to lead the way higher with tentative bounces of their own. If they manage any kind of sustained bear-flag type climb, they could pull the OEX up into its own bear flag. May not happen. Those who exited with me may be forced to sit and stare at the computer all day, dreaming of what might have been, but that's better than chasing new entries. Those who retained a partial bearish position are feeling good, but need to be aware of the continued possibility of a bounce.

Jonathan Levinson : 10/5/2005 11:00:36 AM

QQQQ seems to be printing a bear flag, as there's not enough action to set up a reverse h&s so far from these levels. The short cycle upphase is showing signs of topping on som indicators without having tested 39.20. Overall, a tricky setup at these levels: Link

Linda Piazza : 10/5/2005 10:50:24 AM

If you entered a bearish OEX play at the open or shortly afterwards as per my early comments, then hopefully you also took my advice to take either partial or full profits. If you took partial profits, that advice was to also reset stops, either to breakeven or to an account-management-style level. I said that I was taking the full-profit route. I like to trade these expected short moves with options with a delta above 0.70 (or rather, below -0.70, since this is a put we were talking about) if I can, and so they're going to start losing big on a bounce, too. Plus, I tend to be rather conservative about exiting ahead of a potentially market-moving event.

So, if you followed those steps, then you're mentally and financially prepared to watch this bounce attempt. I'll be watching for a setup for a bounce and rollover play, but remember that it might not come. That was the risk I mentioned earlier, and I don't want to chase entries. I agree with Jane's 10:37:14 post on the Futures side. I don't get the right setup: I'm not going to risk entering and losing the profit I made this morning. The ideal setup would be a measured climb up to 560.50-562.00 or so with an appropriate advdec climb to -1900 to -1500 and then a rollover from there on both, but I'm just not sure that will come. And, of course, bears must be aware of the possibility that a climb could get away from you. Don't let a profitable position turn unprofitable.

Jonathan Levinson : 10/5/2005 10:45:21 AM

Stepping away for a few minutes.

Jonathan Levinson : 10/5/2005 10:45:06 AM

QQQQ coming up for a retest of 72 SMA resistance at 39.20: Link

Jeff Bailey : 10/5/2005 10:43:01 AM

Bearish swing trade short alert ... for Valero Energy (VLO) $111.71 here, stop $114.50, target $105.

Jeff Bailey : 10/5/2005 10:39:53 AM

EIA Gross Inputs/Refinery Operable Capacity Table found at this Link ... 69.79% of the nations operable capacity online.

Linda Piazza : 10/5/2005 10:38:15 AM

Advdec attempting to steady, not yet climbing.

Linda Piazza : 10/5/2005 10:38:36 AM

The BIX has just inched below the 200-week-ema with the 200-week-sma about five points below its current level. Those are at 332.19 and 325.15, respectively, with the BIX at 330.07 as I type. One or the other of these is likely to get the attention of dip-buyers, but the BIX has broken soundly beneath the neckline of a H&S on its weekly chart, just after it broke through its important 72-week-ema. This average's importance was demonstrated when it rose back to retest it and then fell away into the current decline.

Linda Piazza : 10/5/2005 10:35:03 AM

The BIX is trying to bounce, too, also looking corrective and tepid so far.

Linda Piazza : 10/5/2005 10:34:35 AM

The RLX started a bounce attempt about 20 minutes ago. It's looking corrective so far, looking as if it's trying to form up into some kind of bear flag or similar formation. It's a tepid bounce attempt just yet, too, so I wouldn't be surprised to see another retest of the LOD before the RLX steadied enough to form a real bear flag. A new LOD would undo the whole thing.

Jonathan Levinson : 10/5/2005 10:34:15 AM

Headlines:

U.S. DISTILLATE STKS DOWN 5.6 MLN BRLS: ENERGY DEPT

U.S. GASOLINE STKS DOWN 4.3 MLN BRLS: ENERGY DEPT

U.S. CRUDE STKS DOWN 300,000 BRLS LAST WEEK: ENERGY DEPT

Jonathan Levinson : 10/5/2005 10:34:00 AM

QQQQ has turned back lower with the wavelet cycle, and any who regretted my early exit at 39.06 can get back in, but I'll be sitting it out. 30 min channel support is now down to 38.93. Link

Jonathan Levinson : 10/5/2005 10:31:52 AM

Crude oil is up .70 at 64.60 here, natgas +.375 at 14.60.

Linda Piazza : 10/5/2005 10:31:26 AM

No bounce in the TRAN, but it's hovering over a possibly important support zone after a steep descent. I would think that downside would slow, at least, if there isn't a steadying attempt or maybe even a bounce attempt.

Jonathan Levinson : 10/5/2005 10:30:20 AM

From the EIA website:

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) inched lower by 0.3 million barrels from the previous week. At 305.4 million barrels, U.S. crude oil inventories remain above the upper end of the average range for this time of year. Total motor gasoline inventories dropped by 4.3 million barrels last week, putting them just above the lower end of the average range. Distillate fuel inventories fell by 5.6 million barrels last week, and are just above the middle of the average range for this time of year. A sharp drop in low-sulfur (diesel fuel) distillate fuel more than compensated for a slight rise in high-sulfur (heating oil) distillate fuel. Total commercial petroleum inventories plummeted by 9.9 million barrels last week, but are in the upper half of the average range for this time of year.

Linda Piazza : 10/5/2005 10:28:23 AM

The OEX has hit daily Keltner support at 556.77, another reason for a bounce attempt. I'm going to be treating it as a countertrend bounce and won't be recommending long entries, but I have recommended that bears take partial profits, at least, and lower stops on the rest in preparation for a possible bounce. I will be watching for a rollover entry if there's a bounce.

Jonathan Levinson : 10/5/2005 10:27:27 AM

Petroleum report due in 165 seconds according to the EIA.

Linda Piazza : 10/5/2005 10:26:08 AM

There should be a bounce somewhere through here and post-inventories would be a perfect time for such a bounce. Bears want to see the advdec line stall again between -1900 and -1500, if so. They want to see the OEX maintain 30-minute closes beneath 560.22.

Jonathan Levinson : 10/5/2005 10:24:14 AM

QQQQ - Exit Point Alert -

Out QQQQ long from 38.99 at 39.06

Linda Piazza : 10/5/2005 10:21:41 AM

The TRAN hit the 72-ema on its daily chart, at about 3754.52 (my charting service is leaving out some bars, so the number may not be exact), with the TRAN's low at 3655.11. This average does have some resonance, but it's perhaps the 38.2% fib level off the rise off the June low into the summer high that has more resonance. It's at 3655.38.

Jonathan Levinson : 10/5/2005 10:21:37 AM

The wavelet cycle is bouncing and getting pretty weak traction so far. Thinking of bailing on the long here looking to reload. The petrol report is always good directionless spikes as well.

Jonathan Levinson : 10/5/2005 10:19:33 AM

Session high for 10-year notes, TNX -4.2 bps at 4.334%.

Jonathan Levinson : 10/5/2005 10:19:12 AM

Volume breadth -4.43 on the NYSE, -1.95 on the Nasdaq.

Jonathan Levinson : 10/5/2005 10:14:41 AM

Here's the setup- we're testing S1 and 30 min channel support with the intraday cycle appearing maxxed out to the downside. I'm very leery of a further clothesline drop from here, so the stop is very tight just below support. Link

Jonathan Levinson : 10/5/2005 10:13:29 AM

QQQQ - Entry Point Alert -

Long QQQQ at 38.99stop, 38.96

Linda Piazza : 10/5/2005 10:13:22 AM

My trading style might be more conservative than some, but I decided to exit my bearish position ahead of the inventories number and watch what happens afterwards. That advdec line just scares me, as it looks ripe for a bounce. It may not occur and I may be in the position of chasing a new entry all day. Hence my advice to the rest of you who entered bearish positions today to take partial profit ahead of the inventories number, at least, and to lower stops on the rest. The conservative among you might do as I've done, but realize that you're risking missing out on further gains to your bearish positions if markets just crater.

Jeff Bailey : 10/5/2005 10:12:01 AM

10:00 Internals found at this Link

Linda Piazza : 10/5/2005 10:10:56 AM

Those in bearish OEX positions from the open or from shortly after the open might consider taking partial profit at least before the inventories number, as the chance of a bounce post-inventories exists. At least lower your stops to breakeven, if nothing else and plan on getting in again on any bounce and rollover.

Jonathan Levinson : 10/5/2005 10:07:00 AM

QQQQ smashes support here, reaching for S1 at 39.00: Link

Linda Piazza : 10/5/2005 10:06:31 AM

The TRAN drops straight into its support zone near 3650, with that composed of historical support and various MA's. The 200-sma is below that, at 3634.20, and the TRAN currently is at 3662.82. The TRAN often does a pre-inventories swoop one direction or the other, with that sometimes reversed and sometimes continued after the inventories. There's no real pattern that I can find.

Jonathan Levinson : 10/5/2005 10:03:28 AM

QQQQ has undone its bullish wavelet divergence, and if it doesn't bounce now, the Macd will roll back over as well: Link

Jeff Bailey : 10/5/2005 10:03:10 AM

Sell Program Premium ... DIA $104.22, SPX 1,211.43, QQQQ $39.26

Linda Piazza : 10/5/2005 10:02:54 AM

Not much of a bounce so far on the OEX or in the advdec line. Support still being tested in both. If you entered at the open when the advdec line opened in accordance with the signs I mentioned earlier or a bit later, when the OEX violated the 9/22 low, you're still in danger of having to weather a bounce, but are liking the weakness. I'm still wishing the advdec line weren't so extreme to the downside, though.

Jonathan Levinson : 10/5/2005 10:02:45 AM

Headlines:

U.S. SEPT. ISM SERVICES PRICES 81.4% VS 67.1% IN AUG.

U.S. SEPT. ISM SERVICES NEW ORDERS 56.6% VS 65.8% IN AUG.

Jonathan Levinson : 10/5/2005 10:01:51 AM

Headlines:

U.S. SEPT. LAYOFFS UP 1.8% TO 71,836: CHALLENGER

U.S. Q3 LAYOFFS DOWN 2.5% Y-O-Y TO 245,378: CHALLENGER

TRANSPORTATION, RETAIL SECTORS TOP SEPT. LAYOFFS: CHALLENGER

Jeff Bailey : 10/5/2005 10:01:49 AM

10:00 Market Watch found at this Link

Jonathan Levinson : 10/5/2005 10:01:29 AM

Headlines:

U.S. SEPT. ISM SERVICES 53.3% VS 65.0% IN AUG.

U.S. SEPT. ISM SERVICES BELOW CONSENSUS 60.3%

Jonathan Levinson : 10/5/2005 10:01:03 AM

ISM Services 53.3 vs. 60 exp.

Jonathan Levinson : 10/5/2005 9:55:14 AM

A 4.75B overnight repo results in a small 1.25B net drain for the day. The stop out rate was 3.74, 1 bp below the 3.75 target rate.

Linda Piazza : 10/5/2005 9:53:26 AM

Here's the bounce beginning in the OEX and in the advdec line. Remember that inventories have the possibility of changing the tenor of the markets today, although I wouldn't think it would change it in any positive manner, unless it was a "not as bad as expected" reaction.

The advdec line is at an extreme level, all the way up to the 60-minute chart. It has not yet shown bullish divergence, but this does make me nervous on behalf of bears. On a bounce, which should be expected at some point, bears want to see the advdec line remain below -1300 to -1000, and don't want to see any such bounce carry the OEX higher than 562-563.50, and preferably would like to see it stopped between 561.02-562.27 on 15-minute closes.

Jonathan Levinson : 10/5/2005 9:50:30 AM

QQQQ shows a bullish divergence in the wavelet and short cycle Macd, but they're trending in oversold and tough to read. The repo announcement is due any minute. Link

Jeff Bailey : 10/5/2005 9:49:17 AM

Buy program kicking in here

Linda Piazza : 10/5/2005 9:48:10 AM

The OEX is now breaking below the 9/22 low, confirming its breakdown out of the rising regression channel off that low--a supposed bear flag. It is, however, at Keltner support and bounce potential still exists. If so, bears want to see 15-minute closes remain beneath 560.98 and certainly beneath 561.67-562.11 to maintain the breakdown signal on its 15-minute chart.

Jonathan Levinson : 10/5/2005 9:46:38 AM

The Fed has 6B expiring this morning, the announcement due just before 10AM. Then at 10, it's ISM services and the petrol report at 10:30.

Jeff Bailey : 10/5/2005 9:46:27 AM

Delphi (DPH) $2.28 -17.98% ... new 52-weeker at the big board.

Delphi Trust I 8.25% (DPH-A) $6.80 -24.86% ...

Linda Piazza : 10/5/2005 9:45:29 AM

The OEX is testing the 9/22 low of 558.99, with the OEX LOD at 559.08. A bounce attempt could be expected, but a punch through that equal-low level could get more started to the downside. The advdec line is at a level at which a bounce attempt could be expected there, too, but if so, I would then expect a rollover near 562. Those who want to risk an entry now could do so, but they're facing risk up to 562-563.50.

Jonathan Levinson : 10/5/2005 9:44:05 AM

QQQQ's overdue for a short cycle bounce within the broader declining 30 and 60 min channels. It's a bummer to have been shanked out of our short on yesterday's spike, but so it goes. I will seek to reestablish that short on any bounce. Currently, upside resistance is found at 39.40, .45 and .60: Link

Jeff Bailey : 10/5/2005 9:40:54 AM

Human Genome Sciences (HGSI) $10.20 -26% Link ... Atop this morning's most active list. The company said its experimental lupus drug failed to meet main targets in a mid-stage study. The biotechnology company said a 449-patient, Phase II trial of the monoclonal antibody LymphoStat-B showed the drug was safe and well tolerated, but it did not meet primary efficacy goals.

The trial was designed to evaluate the drug in patients with systemic lupus erythematosus, or SLE, a form of lupus that is diagnosed in 200,000 to 500,000 Americans.

Linda Piazza : 10/5/2005 9:36:46 AM

The OEX's current downside Keltner target is 558.92. I'd like to see a bounce now to offer a new bearish entry, but the advdec line instead suggests more downside to come. It's approaching an extreme level so quickly, however, while the OEX remains fairly steady, that I'm holding off suggesting a new entry. If any did enter such a new position at the open because of the action of the advdec line, I think you're probably going to be okay, but will probably have to weather a bounce.

Jonathan Levinson : 10/5/2005 9:33:54 AM

QQQQ continues to tread water at in its opening range- 30 min channel support is down to 39.22, and the bias remains downward below the 72 SMA at 39.43: Link

Jonathan Levinson : 10/5/2005 9:31:00 AM

Volume breadth is -2.63 on the NYSE, -1.23 on the Nasdaq at the open.

Linda Piazza : 10/5/2005 9:30:32 AM

The advdec line opens near resistance and heads down.

Jeff Bailey : 10/5/2005 9:30:59 AM

ADC Telecommunications (ADCT) $22.67 Link ... marked lower at $18.79 on profit warning. The company said weak sales of fiber-optic network gear, amplifiers and services to wireless customers has it forecasting fiscal fourth-quarter earnings from continuing operations of 15 cents to 19 cents a share on sales of $290 million to $300 million.

The average forecast among analysts is $0.28 per share on revenues of $321 million.

Jeff Bailey : 10/5/2005 9:15:02 AM

Matrix Service (MTRX) $8.14 ... Yesterday afternoon the company filed SEC form 8-K Link disclosing that it had completed a direct private placement of 2.3 million shares of common stock at a purchase price of $6.50.

This morning, the company announced it signed a definitive agreement for $22 million to construct tankage at a terminaling facility at St. James, Louisiana. Press release at this Link

Jane Fox : 10/5/2005 9:14:14 AM

Dateline WSJ Major Asian stock markets are booming, but analysts caution investors that high energy prices and rising interest rates could curb the rally. Benchmark share indexes in Australia, India and South Korea have hit records. Seoul's Kospi index is up nearly 39% this year. Even chronic laggards like Japan's Nikkei Stock Average and China's struggling exchanges are showing signs of life. The Nikkei roared to a fresh four-year high yesterday. By contrast, the Dow Jones Industrial Average in the U.S. is down 3% this year. Fueling the rise is foreign cash, in search of higher yields than are typically found in developed countries. But unlike in previous Asian bull runs, local investors also are getting in...

The gains have come as energy prices have jumped, threatening to spark inflation -- and leading many investors to question whether the major Asian stock markets are accurately reflecting the underlying health of the region's economies.

The Asian Development Bank's chief economist, Ifzal Ali, told Dow Jones Newswires last week that economic growth could slow further than previously expected. The International Monetary Fund in August nudged up its 2005 economic-growth forecast for Asia, excluding Japan, to 7.3% from its April forecast of 7%, but cautioned that the risks ahead are "increasingly slanted to the downside," citing oil as a chief worry. It is hard to argue with the money making its way to Asia, as well as Europe -- especially considering the sluggishness of the U.S. markets. Yet in the long run, the divergence between the heady Asian-Pacific markets and the region's economic warning signs could mean trouble.

Jonathan Levinson : 10/5/2005 9:11:57 AM

Two weeks before a new, more restrictive national bankruptcy law goes into effect, financially strapped Americans are rushing to file for protection from their creditors, with filings climbing to an unprecedented average of 13,000 a day last week.

Week after week records are toppled. Last week's 68,287 new filings surpassed the record set the week before by 24 percent, and this week's total is likely to be higher, according to data released yesterday by Lundquist Consulting Inc., a financial research firm. Daily filings averaged 10,367 in September, compared with an average of 6,079 in the same month a year ago.

Link

Linda Piazza : 10/5/2005 9:05:57 AM

The OEX ended the day yesterday just below a rising trendline off the 9/22 low, just below one off the April low, and just above one off the 7/07 low. There's the chance that it just overran support a little yesterday and will attempt a bounce this morning. It's within a potentially strong support level, but also that close suggests a potential breakdown in the making. It's traveled about as far from its 30-minute 100/130-ema's as it usually travels without attempting a bounce. The RLX ended the day still above a rising trendline off the September low. The TRAN created a reversal signal, but ended the day just above its 50-sma.

I'm thinking a bounce attempt might be expected, perhaps after some small follow-through to the downside this morning. If there's a bounce, I'll be looking for a potential rollover in the 562 region. Aggressive bears could take a chance on an entry at the open with a stop set an account-appropriate amount above 562, but that's not the route I'll be taking or suggesting. For myself, I'm going to want to see how the advdec line sets up first. For those who want to watch for yourselves and judge whether an entry is a good idea or not before I can get it posted, here's what I'll want to see on the advdec line: an opening level between -300 and +100 that moves swiftly lower or perhaps a particularly strong, overdone level at the open, say near +1900-2000 that reverses within the first fifteen minutes. There's some judgment to assessing the advdec's opening, though. What you don't want to see if contemplating a new bearish entry is an opening advdec value near -2200 to -1450 and a swift move up from there.

What about a long play as this long-term support is tested? Just can't suggest it, at least not pre-market. If anything sets up after the open, I'll mention it, but yesterday's precipitous drop suggests that long entries would be countertrend ones. Those oversold bounces can be sudden and strong, but they can also be tepid and difficult to judge and subject to sudden collapses.

Jonathan Levinson : 10/5/2005 8:45:59 AM

Session highs for crude oil and natgas at 64.20 and 14.41 here.

Jonathan Levinson : 10/5/2005 8:35:18 AM

From the Mortgage Bankers Association website:

WASHINGTON, D.C. (October 5, 2005) - The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending September 30. The Market Composite Index - a measure of mortgage loan application volume - was 713.5, a decrease of 1.1 percent on a seasonally adjusted basis from 721.2 one week earlier. On an unadjusted basis, the Index decreased 1.2 percent compared with the previous week and was down 1.8 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index decreased by 1.9 percent to 473.8 from 483.1 the previous week whereas the Refinance Index increased by 0.1 percent to 2107.4 from 2106.6 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which decreased 1.8 percent to 1068.9 from 1088.8 the previous week, and the Government Index, which increased 11.4 percent to 120.3 from 108.0 the previous week.

The four week moving average for the seasonally-adjusted Market Index is down 1.9 percent to 741.9 from 756.4. The four week moving average is down 1.3 percent to 492.7 from 499.0 for the Purchase Index while this average is down 2.8 percent to 2191.6 from 2254.0 for the Refinance Index.

The refinance share of mortgage activity increased to 44.5 percent of total applications from 43.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 29.8 percent of total applications from 28.8 percent the previous week.

Jonathan Levinson : 10/5/2005 8:27:31 AM

Ten year notes hold a light gain, with TNX down 1.2 bps at 4.364% at the open. IRX is down 1.8 bps at 3.517%.

Jonathan Levinson : 10/5/2005 8:03:54 AM

The Fed's sudden spate of hawkish jawboning yesterday certainly sounded appropriate to me, but of couse didn't jibe with its open market activity even for the day. With 7B in overnight money expiring, they added 6B in overnight repos, but then followed it up with a 1.2B coupon pass. Even a 50 bp hike will have a significantly lesser impact on asset prices if the open market desk continues to liquify the markets.

Jonathan Levinson : 10/5/2005 7:47:18 AM

We were stopped out of our short from 39.74 at breakeven on the distribution spike yesterday that was run in the light volume, and would have had a beautiful winner but for the stop run. The reversal off yesterday's doji high engulfed all of the previous day's range in a massive gravestone doji, also a key reversal print for the day.

The daily cycle upphase obviously took that print on the chin, but has yet to stall. By my estimation, it will take a close below 39.00-39.08 QQQQ to generate the first daily cycle sell signal.

Jonathan Levinson : 10/5/2005 7:43:42 AM

Equities are up, ES trading 1217.75, NQ 1605.5, YM 10457 and QQQQ -.01 at 39.29. Gold is down 1.3 at 468.10, silver -.002 at 7.425, ten year notes +1/8 at 109 3/4, crude oil is up a nickel at 63.95 and natgas is up .11 at 14.335.

We await the 10AM release of ISM Services, est. 60, and at 10:30, the weekly petroleum report.

Linda Piazza : 10/5/2005 7:11:22 AM

Good morning. Bourses around the globe were pressured last night, with three Fed heads sounding hawkish yesterday. The Nikkei dropped, as did many other Asian markets. European markets drop even more heavily. As of 6:56 EST, gold was lower by 1.80, to $467.50, and crude, higher by $0.10, to $64.00. Our futures were near the flat-line level at that time. More details about Asian and European markets follows in succeeding paragraphs.

The Nikkei dropped quickly off its four-year high reached in earliest trading, and then closed near the level of that early drop. It closed down 48.95 points or 0.36%, at 13,689.89. Aeon Co.'s report of record first-half profit helped retailers, and that retailer ended the day higher by 4.9%. Mizuho Financial Group dropped in earliest trading after a newspaper report that it would sell $3.5 billion worth of its own shares. Pioneer Corp. was the topic of a report that it would report an operating loss, its first in ten years. GM reported that it would sell its Fuji Heavy Industries position, with GM currently holding 20% of its stock.

Most other Asian markets fell, too. The Taiwan Weighted dropped 0.12%, and South Korea's Kospi fell 1.24%. Singapore's Straits Times rose 0.09%, but Hong Kong's Hang Seng fell 1.44%. China's Shanghai Composite remains closed for Chinese holidays.

European markets drop heavily, with oil majors seeing strong profit taking. Automakers and some techs also declined. The Bank of England's MPC rate meeting began today, carrying through to tomorrow. UK corporate profitability showed an adjusted-for-depreciation second-quarter rise of 13.7% in return on capital among non-financial companies. This result was the highest in five years. In the U.K., September's services PMI, at 55.0, registered the lowest level this year. September's services sector PMI numbers were released throughout Europe, with headline numbers up in Germany, Spain and Italy, but slipping in France. Recent strikes in France may have impacted the number. On many releases by individual countries, prices charged remained mellow, showing that rising energy costs have not yet been passed on to consumers. The EU12 services PMI was higher than expected, rising to 54.7 from a revised-higher August reading of 53.4. Business expectations, new and outstanding business, employment growth, input prices, and prices charged all moved higher and were all above 50. Also in the Eurozone, a separate release showed August's retail sales climbing 0.9% month over month and 2.0% year over year, more than expected. Focusing again on Germany, the BGA Exporters' Association said it expects GDP growth of only 0.7% this fiscal year and below 1% in 1006. It believes the trade surplus will widen next year as import growth slows, and the association proposes that exports are the only current catalysts to the Germany recovery.

Stock-specific news showed French catering group Sodexho SA falling after reporting sales for the fiscal year ending August 31 and U.K. company Aegis climbing after French advertising company Havas said that it's not ruling out being a participant in an offer for Aegis. Danish telecom TDC gained after it fielded a bid from a second private-equity consortium. Swedish insurer Skandia rose as it reportedly considers hiring GS as its adviser to help it resist a takeover bid from Old Mutual. Morgan Stanley current servces as its adviser.

As of 6:56 EST, the FTSE 100 was lower by 52.00 points or 0.95%, to 5,442.40. The CAC 40 was lower by 42.57 points or 0.92%, to 4,607.67. The DAX was lower by 51.85 points or 1.01%, to 5,086.17.

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