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Tab Gilles : 10/19/2005 1:29:21 AM

Energy Select Sector SPDR (XLE) Link Profunds Energy (ENPIX) Link

Jeff Bailey : 10/18/2005 10:26:45 PM

Program Trading Levels for Wednesday ... HL Camp & Company has their computers set for program buying at $5.01 and set for program selling at $+2.51.

Fair Value for the S&P 500 is $3.66, that price will not change during Wednesday's session.

Jeff Bailey : 10/18/2005 10:19:12 PM

Earnings

Intel (INTC) $23.72 Link ... last tick in extended session was down at $22.95. Q3 EPS of $0.32 on revenue of $9.96 billion vs. forecast of $0.33 on $9.92 billion.

Yahoo! (YHOO) $33.70 Link ... last tick was up at $33.75. Q3 EPS of $0.17 on revenue of $932 million vs. forecast of $0.14 on $918 million.

Motorola (MOT) $20.17 Link ... last tick was up at $20.80. Reported EPS of $0.30 on revenue of $9.42 billion vs. forecast of $0.28 on $9.1 billion.

Linear Tech. (LLTC) $35.96 Link ... last tick was down at $35.00. Reported EPS of $0.31 on revenue of $256 million vs. consensus of $0.33 on revenue of $257 million.

Seagate Tech. (STX) $15.05 Link ... last tick was up at $15.65. Reported Q1 EPS of $0.54 on revenue of $2.09 billion vs. consensus of $0.54 on $2.2 billion.

Continental Airlines (CAL) $11.89 Link ... last tick was down at $11.60. Reported profit of $0.80 on revenue of $3 billion vs. consensus of $0.27 on $2.98 billion.

Cymer (CYMI) $33.50 Link ... last tick was up at $35.00. Reported profit of $0.35 per share on revenue of $99.7 million vs. consensus of $0.20 on $95.5 million.

Ryland (RYL) $64.38 Link ... last tick was up at $64.52. Reported Q3 profit of $2.39 per share vs. consensus of $2.29 a share.

Sovereign Bancorp (SOV) $21.22 Link ... last tick was up at $21.27. Reported Q3 EPS of $0.48 vs. consensus of $0.46 a share.

Cheesecake Factory (CAKE) $30.99 Link ... last tick was up at $31.19. Reported Q3 EPS of $0.27 on revenue of $292.8 million vs. consensus of $0.27 on revenue of $297 million.

OI Technical Staff : 10/18/2005 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The Market Monitor has been archived.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.

Jeff Bailey : 10/18/2005 4:41:50 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 10/18/2005 4:35:55 PM

Closing Internals found at this Link

Jonathan Levinson : 10/18/2005 4:25:02 PM

INTC +.66 at 24.12 here.

Jonathan Levinson : 10/18/2005 4:24:07 PM

Intel Announces Record Revenue of $9.96 Billion; EPS of 32 Cents Includes Legal Settlement that Lowered EPS by Approximately 2 Cents

SANTA CLARA, Calif., Oct 18, 2005 (BUSINESS WIRE) -- Intel Corporation today announced record revenue of $9.96 billion for the third quarter, up 18 percent year-over-year and up 8 percent sequentially.

Third-quarter operating income was $3.1 billion, up 31 percent year-over-year and up 17 percent sequentially, and includes the impact of a legal settlement discussed below. Net income was $2 billion, up 5 percent year-over-year and down 2 percent sequentially. Earnings per share (EPS) were 32 cents, up 7 percent from 30 cents in the third quarter of 2004 and down 3 percent from 33 cents in the second quarter of 2005. Third-quarter net income and EPS included the impact of a legal settlement and tax item discussed below.

Link

Jonathan Levinson : 10/18/2005 4:22:58 PM

QQQQ blows through channel support here, bad tick to 37.60 and bouncing to 38.05 as I type: Link

Jeff Bailey : 10/18/2005 4:09:07 PM

Current OPEN MM Profiles found at this Link ... Today's Activity ... I did not profile any trades today.

Jonathan Levinson : 10/18/2005 4:00:50 PM

QQQQ tests lower parallel channel and 30 min channel support here at 37.88: Link

Linda Piazza : 10/18/2005 3:59:09 PM

We can stop watching that potential inverse H&S on the OEX's 30-minute chartm, at least.

The OEX is sinking below the 547.40-ish zone that I thought would probably hold it into the end of the day, sinking now toward the 61.8% retracement of the rally off the 10/13 low. That's at 547.08 and just a few cents away. The OEX is currently testing the bottom of that Keltner channel that usually holds prices. A breakdown below it (tomorrow, not in the last few minutes of trading when targets sometimes get overrun) would set up a downside target of 543.10, but I consider it holding into the end of the day. Daily Keltner support is at 546.37, with daily resistance, mentioned earlier today as it was being tested, turning the OEX back. That was at 551.19 on daily closes.

Jonathan Levinson : 10/18/2005 3:58:18 PM

Volume breadth -3.89:1 on the NYSE, -2.19:1 on the Nasdaq.

Jonathan Levinson : 10/18/2005 3:56:24 PM

Session lows for ES and YM printing here, QQQQ down .21 at 37.97. QQQQ chart updated at this Link

Linda Piazza : 10/18/2005 3:54:03 PM

The way that the advdec line is set up, there's often a climb in early trading the next day, although from what level and to what level is not guaranteed. It's also not guaranteed that the bounce will stick, but I thought I'd mention that possibility to those of you making end-of-day decisions on your OEX positions.

Linda Piazza : 10/18/2005 3:47:04 PM

The just-completed OEX 15-minute candle did not manage a close at or above the 50% retracement of the rally off the 10/13 low, calling into question whether the OEX might need to retreat all the way to the 61.8% retracement, with that at 547.08. There's strengthening Keltner suport down to 547.18.

Linda Piazza : 10/18/2005 3:42:03 PM

OEX 547.40-ish support being approached now. Keltner support at 547.19-547.43. OEX at 547.71.

Linda Piazza : 10/18/2005 3:38:52 PM

Midpoint of the OEX's rally off the 10/13 low being tested again, with that at about 548.10, and with the OEX having produced 15-minute closes at or above it through the afternoon. OEX at 548.24 as I type.

Jonathan Levinson : 10/18/2005 3:37:12 PM

I view today's action as a confirmation of QQQQ 38 support, and more particularly the put support at 38 for October expiration. 38.20-.25 resistance has been a profitable area for shorts, but if that 38 level is going to hold, then it's worth reflecting on how far overhead 39 call resistance is located. Since Thursday, there's been a pattern of higher lows and flat resistance at 38.20 (factoring out the premarket action) for a possible rising triangle. Bears will want to keep stops just above the 38.25 area if trying to catch a drop. Bulls have been successfully buying just below support, and currently, 30/60 min channel support is at 37.87, right on the rising parallel support line: Link

Linda Piazza : 10/18/2005 3:36:16 PM

OEX back below the five-minute 21-ema, also below the 548.84 Keltner resistance. Next support 547.29-547.69.

Jeff Bailey : 10/18/2005 3:34:42 PM

Semiconductor Index (SOX.X) 440.81 -0.87% ... come to their noon highs. One could say it is "high noon" ahead of tonight's earnings from chip gian Intel (INTC) $23.90 +1.83%.

Linda Piazza : 10/18/2005 3:31:20 PM

Once again, the OEX did not close the last 15-minute period above the Keltner resistance currently at 548.86, but it's trying again, and it is, so far, holding above its five-minute 21-ema. OEX at 549.02 as I type, heading into the mid-channel resistance zone just under 550.

Jonathan Levinson : 10/18/2005 3:27:53 PM

The Qs are right back to where they started this morning on a quick spike back above the 72 SMA: Link

Linda Piazza : 10/18/2005 3:27:24 PM

I'm also watching the five-minute 21-ema, with that having pressured the OEX lower all afternoon. The OEX just gapped above that average at 548.79, but it hasn't had even a five-minute close above it. I'm kind of looking for 547.40 to have been today's downside target, but then I thought it would likely test 552.30-553.40 before it keeled over, too, and it didn't. I had been thinking that there would be a fake-out break to the upside, reversed when that resistance was hit. Instead, there was a break to the downside out of that triangle, and it was no fake-out move.

Linda Piazza : 10/18/2005 3:24:56 PM

First OEX Keltner resistance at 548.84 on 15-minute closes. OEX at 548.76 as I type.

Jeff Bailey : 10/18/2005 3:26:02 PM

Global Economy ... Argentina's September industrial output up 1.2% on month, 8.6% on year.

ILF $110.80 -1.46% Link , EWZ $30.35 -2.47% Link

Linda Piazza : 10/18/2005 3:20:11 PM

Tentative bullish divergence on the OEX's 15-minute chart, both price/RSI and Keltner-style.

Linda Piazza : 10/18/2005 3:19:38 PM

Next OEX Keltner resistance at 548.83 on 15-minute closes, with that being Keltner resistance that has held since the OEX broke down out of its triangle today.

Linda Piazza : 10/18/2005 3:17:40 PM

The OEX is closing 15-minute periods at the 50% retracement of the climb off the 10/13 low, with that at about 548.10. It's piercing that 50% mark intra-period, but closing at it. If it can hold there, something it has a chance of doing since the OEX also has Keltner and historical support near 547.40, the it might rise to test the 549.11-ish next Fib level off that rally off the 10/13 low. That possibility is currently a very iffy one, though, with the OEX at 548.30 currently. The advdec line is attempting another climb, but a tepid one.

Jonathan Levinson : 10/18/2005 3:17:18 PM

Full text of Janet Yellen's speech at this Link

Jonathan Levinson : 10/18/2005 3:15:26 PM

Volume breadth is down to -3.54:1 on the NYSE, -2.03:1 on the Nasdaq.

Jeff Bailey : 10/18/2005 3:11:06 PM

03:00 Internals found at this Link

Linda Piazza : 10/18/2005 3:08:14 PM

Another new LOD for the OEX as it tested 15-minute Keltner support from 547.41-547.84 currently. There's potential bullish price/RSI divergence on the 5-minute chart, but little use to talk about that until and unless the advdec line climbs. It's got a tepid little bounce now, but nothing for bulls to . . . what would be the bullish equivalent of "crow" . . . about, and it reversed while I typed.

Jeff Bailey : 10/18/2005 3:02:42 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 10/18/2005 3:01:33 PM

I've added a parallel trendline to match the upper channel resistance line in place off the Thursday lows. Like the cycle sell signals, there have been two support line breaks in 2 days that haven't followed through. Perhaps the 37.85 support line will be more significant. My bias here is to the downside, but without any of the cycles getting price traction, it's much more difficult to get a position with a manageable stop. Link

Linda Piazza : 10/18/2005 2:57:36 PM

The OEX has had opens or closes three days over the last week at the 547.40 zone, so that's potentially strong support.

Linda Piazza : 10/18/2005 2:56:10 PM

OEX Keltner support at 547.46-547.98 on 15-minute closes.

Linda Piazza : 10/18/2005 2:55:31 PM

Advdec line not climbing.

The OEX is coiling again, this time at the bottom of its decline. This triangle looks tighter and shouldn't take as long to break. A five-minute close above the five-minute 21-ema might break it to the upside, while a downside break would come on a move below . . . just came. Watch the previous LOD for possible support.

Jonathan Levinson : 10/18/2005 2:50:35 PM

Ten year note yields rise to a .6 bp loss at 4.483% following Yellen's comments, IRX holding a 6.5 bp gain at 3.765%. Still looking for a link to the full text of Yellen's speech, but nothing's been posted on the Fed site yet.

Linda Piazza : 10/18/2005 2:49:23 PM

Since the OEX fell through its triangle, the five-minute 21-ema, currently at 549.21, has been serving as resistance. OEX headed up to retest it, with the OEX at 549.00 as I type. The advdec line has got to rise before any upside test is going to look convincing, though, and it hasn't done that yet. It's at -2643 as I type, QCharts value.

Jeff Bailey : 10/18/2005 2:50:22 PM

Blackboard (BBBB) $27.14 +13.60% Link ... "chalk up" a new 52-weeker. The educational software maker releases "Release 7" of its Blackboard Acedemic Suite.

Story at this Link

Linda Piazza : 10/18/2005 2:45:27 PM

OEX Keltner support from 547.54-548.24. OEX at 548.49.

Jonathan Levinson : 10/18/2005 2:45:05 PM

Headlines:

FED'S YELLEN: GRADUAL RATE HIKES STILL MAKE SENSE

YELLEN: ECONOMY ON 'SOLID TRACK' DESPITE STORMS

YELLEN: MORE RATE HIKES NEEDED TO BRING POLICY TO NEUTRAL

YELLEN: MIDPOINT OF NEUTRAL RATE RANGE IS 4.5%

YELLEN: HEALTH OF CONSUMER CRUCIAL AS RATES NEAR NEUTRAL

YELLEN: CONSUMER SPENDING HOLDING UP WELL SO FAR

YELLEN: CORE PCE YR-ON-YR NEAR TOP OF 'MY COMFORT RANGE'

YELLEN: MEDIUM TERM OUTLOOK FOR CORE PRICES FAVORABLE

YELLEN: KEY GOING FORWARD IS WHETHER ENERGY IMPACTS WAGES

YELLEN: NO SIGN HIGH GAS PRICES IMPACTING WAGE BARGAINING

YELLEN: MANY COMPANIES CAN'T PASS ENERGY PRICES TO CUSTOMERS

Jonathan Levinson : 10/18/2005 2:37:49 PM

Volume breadth holds at -2.88:1 on the NYSE, -1.66:1 on the Nasdaq.

Linda Piazza : 10/18/2005 2:37:17 PM

I still don't feel confident in direction. The OEX dropped to Keltner support, but there's potential Keltner-style bullish divergence in the channel setup on the 15-minute chart. The climb off that low looks corrective, though.

Linda Piazza : 10/18/2005 2:36:06 PM

OEX looking vulnerable to 548.34 (big stretch, right?) and possibly to another test of support at 547.61 currently. The OEX is at 548.79 as I type.

Jeff Bailey : 10/18/2005 2:33:58 PM

Calpine (CPN) $2.35 -16.96% Link ... Sharply lower after The New York Post reports that the struggling independent power producer has retained restructuring experts from the law firm of Kirkland & Ellis, citing attorneys representing parties that are suing the company.

Jonathan Levinson : 10/18/2005 2:32:31 PM

With the cycles getting no grip, I'm rapidly losing mine as well. Price bounced from channel support, the third bounce in as many days that came just as the 30 min cycle oscillators were getting in gear to the downside. Price is so far respecting the overhang from this morning, but the only clear direction I see here is sideways. Link

Jeff Bailey : 10/18/2005 2:31:00 PM

10 Most Active ... QQQQ $38.05 -0.34%, XOM $56.68 -3.7%, SPY $118.34 -0.68%, INTC $23.92 +1.96%, MSFT $24.72 +0.73%, LU $3.12 -1.88%, CPN $2.36 -16.96%, CSCO $17.10 -0.4%, SIRI $6.00 -2.60%, NVAX $3.06 -6.42%

Jonathan Levinson : 10/18/2005 2:28:03 PM

Crude oil is down 1.125 at 63.225, 35 cents off its low, and natgas is down .45 at 13.435, 6.5 cens off its low, with 3 minutes left in the day session.

Linda Piazza : 10/18/2005 2:26:00 PM

OEX retested the 15-minute 100-ema from the bottom and has fallen back after that test, making its climb off the low so far look like a bear flag climb. While the 30-minute 100/130-ema's had served as resistance, the 15-minute versions had been serving as support this week.

On a Keltner basis, the first resistance is at 549.53, with resistance ranging up to 550.03, and first support is at 547.64-548.44. OEX at 548.89 as I type. The problem with the Keltner resistance is that it's mid-channel resistance and the channels are lined up in an equilibrium position. Sometimes the OEX ranges back and forth across the mid-channel level quite easily when there's an equilibrium setup.

Jeff Bailey : 10/18/2005 2:22:05 PM

Avanir Pharma (AMEX:AVN) $2.82 +6.41% ... gets a "pop" from $2.70 after the company announces $16 million common stock offering. Selling 6.1 million Class A shares at $2.65/share.

Jeff Bailey : 10/18/2005 2:16:13 PM

02:00 Internals found at this Link

Jonathan Levinson : 10/18/2005 2:05:20 PM

QQQQ rises back above the broken trendline and approaches 72 SMA resistance at 38.08, the short cycle kicking off a new buy signal. Pirce now holds below its morning range, all of which should serve as confluence resistance above. But so far, the decline hasn't gotten far at all, still more of the tractionless trading we've been seeing in the intraday cycles. Link

Jonathan Levinson : 10/18/2005 2:03:28 PM

The Nahb-Wells Fargo Housing Sentiment Index rose from 65 in September to 67 in the current month, off its high in June at 72. This was the first increase reported in 3 months.

Jeff Bailey : 10/18/2005 2:02:35 PM

02:00 Market Watch found at this Link

Linda Piazza : 10/18/2005 2:02:14 PM

The OEX did not complete a reversal signal in the just-concluded 15-minute period. First support now at 548.54 on 15-minute closes with stronger support at the 547.70 level currently. OEX at 548.61 as I type.

Jeff Bailey : 10/18/2005 1:57:21 PM

3M (MMM) $74.86 +3.29% ... strong for second consecutive session. Company is leading distributor of N95 face masks and has reported a dramatic spike in sales the past couple of weeks. "Bird Flu" play.

Jonathan Levinson : 10/18/2005 1:51:51 PM

QQQQ retests the broken trendline from below, resistance to 38.03 here, and it would be more bearish if the short cycle indicators weren't gathering in oversold territory: Link

Linda Piazza : 10/18/2005 1:51:28 PM

Potential reversal signal on the OEX's 15-minute chart. It would have to be confirmed by a strong climb this 15-minute period, and I certainly wouldn't be convinced by a 15-minute close just below all that resistance gathered in the 549.77-551.15 zone. So far, there's not a convincing climb during this 15-minute period anyway, but I'm watching because the OEX did approach, if not quite touch, the Keltner boundary that usually confines it. That support is now at 547.73 on a 15-minute close. OEX at 548.72.

Jonathan Levinson : 10/18/2005 1:48:21 PM

Ten year notes have firmed as 13-week bills have weakened, TNX now down 1.4 bps at 4.477% and IRX up 6.8 bps at 3.765% here.

Jonathan Levinson : 10/18/2005 1:47:43 PM

Volume breadth is down to -3.35:1 on the NYSE, -1.97:1 on the Nasdaq.

Linda Piazza : 10/18/2005 1:44:58 PM

OEX bouncing from just above the Keltner targt of 547.74. Keltner-wise, the next resistance is not until up at its breakdown level, at 549.96-550.18.

Jeff Bailey : 10/18/2005 1:42:10 PM

S&P Dep. Receipts (SPY) $118.22 -0.74% ... hugging my "large block" level of $118.17 from early April.

Linda Piazza : 10/18/2005 1:40:45 PM

OEX at 548.19. Next Keltner target and possible support 547.74, with the LOD at 548.02.

Jeff Bailey : 10/18/2005 1:40:36 PM

TRIN 1.64 +160% ... session high and just above WEEKLY R1 (1.58)

Jonathan Levinson : 10/18/2005 1:39:47 PM

5-day view of QQQQ at this Link showing the trendline break.

Jeff Bailey : 10/18/2005 1:34:34 PM

PortalPlayer (PLAY) $26.99 -1.35% ...

Jeff Bailey : 10/18/2005 1:34:05 PM

Semiconductor Index (SOX.X) 437.82 -1.55% ... slips back below MONTHLY S1.

Jeff Bailey : 10/18/2005 1:32:35 PM

North American Telecom Index (XTC.X) 690.64 -0.71% ... breaks to low of session.

LU $3.11 -2.2%, NT $3.48 (unch)

Linda Piazza : 10/18/2005 1:31:54 PM

Next OEX target and support at 547.77.

Jonathan Levinson : 10/18/2005 1:31:06 PM

The 30 min and 60 min channels have turned down in unison for the first time in days, and despite the break back above the rising trendline, the bulls need to get back above 38.10 to stall the synchronous downphases in these key intraday cycles: Link

Jeff Bailey : 10/18/2005 1:31:00 PM

Tunnels under Baltimor Harbor being reopened ... Nothing found in tunnels.

Linda Piazza : 10/18/2005 1:30:40 PM

Caught on the telephone.

Linda Piazza : 10/18/2005 1:26:07 PM

I was wrong to think that this could be a stop-running move below the triangle. That was predicated on several chart characteristics as well as the time of day the break was occurring. I hope some of you participated in the break of the triangle to the downside.

Jeff Bailey : 10/18/2005 1:23:38 PM

Dynamic Materials (BOOM) $20.44 +2.76% ... retraces 50% of session's range.

Jonathan Levinson : 10/18/2005 1:23:16 PM

QQQQ breaks support and now tests lower 30 min channel support. Unless it bounces sharply here, that 30 min channel bottom has plenty of room to run before reaching oversold territory- potentially hours.

Linda Piazza : 10/18/2005 1:22:40 PM

The 50% retracement of the climb off the 10/13 low is coming, at 548.83, just above the OEX's 15-minute next target, currently at 547.82 on 15-minute closes.

Linda Piazza : 10/18/2005 1:21:16 PM

And there it goes. Pretty decisive, and if you entered a bearish play on a break of the triangle, you're a pretty happy camper right now. Advdec line broke down again, too, but only to the next support level. If that breaks further, there's the possibility of a drop in the advdec line down toward the -3000 level. The OEX's next support is at 547.87 on a 15-minute close.

Jonathan Levinson : 10/18/2005 1:21:10 PM

QQQQ is bouncing from its first test of rising support since yesterday at 38.02. The short cycle indicators are heading down and not yet oversold: Link

Jeff Bailey : 10/18/2005 1:21:21 PM

Conoco Phillips (COP) $60.94 -3.30% Link ... sharply lower in unison with XOM $56.78 -3.49% Link

Jonathan Levinson : 10/18/2005 1:19:31 PM

Foreign central banks took a slim 1.67B of the 13B 4-week t-bill auction. The bills sold for 3.52% yielding 3.579%, with a bid to cover ratio of 2.69.

Jeff Bailey : 10/18/2005 1:18:36 PM

Sell Program Premium ... DIA $103.25, SPX 1,183.70, OEX 549.09, QQQQ $38.06

Jeff Bailey : 10/18/2005 1:16:03 PM

01:00 Internals found at this Link

Linda Piazza : 10/18/2005 1:15:26 PM

The OEX is retesting the 19.1% retracement of the decline off the 10/3 high, with that at about 549.74 and with the OEX currently a little below that, at 549.69. It's still within the likely right-shoulder area for that possible inverse H&S. While I don't count on such formations confirming, its presence there does complicate any bearish conclusions, especially with the possibility that the advdec line will again find support. I think that right shoulder certain extends down to 549.40 or so and probably at least down to 549, possibly even a little below that if there are immediate spikes to the upside.

Linda Piazza : 10/18/2005 1:12:06 PM

Advdec testing support while the OEX tests the triangle's support, not yet able to break back inside it.

Linda Piazza : 10/18/2005 1:09:38 PM

Here's the bounce attempt. I don't know why I haven't trusted a downside breakout out of that triangle, but I haven't. This retest may tell us a lot.

Jeff Bailey : 10/18/2005 1:08:12 PM

Exxon Mobil (XOM) $57.10 -3% ... CNBC reporting (and intra-day chart confirms) huge large block sending stock sharply lower from $58.00.

31.5 million shares changed hands in last 5-minutes.

OEX heavyweight here.

Jonathan Levinson : 10/18/2005 1:06:27 PM

QQQQ is back to the lower end of today's range. Rising support off Thursday's low is up to 38.01: Link

Linda Piazza : 10/18/2005 1:05:13 PM

So far, no quick bounce back inside the triangle.

Jeff Bailey : 10/18/2005 1:04:55 PM

01:00 Market Watch found at this Link

Linda Piazza : 10/18/2005 1:03:15 PM

The OEX gapped down to pierce the bottom triangle support. Be wary of a potential quick reversal back into the triangle, especially as the advdec line approaches potential support.

Jeff Bailey : 10/18/2005 12:59:31 PM

Senators give up annual pay raise ... AP - Senators agreed Tuesday to give up their annual pay raise, saying they need to do their part to save the government a little money in light of the huge expenses from Hurricane Katrina and the growing budget deficit.

Under Sen. Jon Kyl's amendment to a spending bill covering federal workers, senators would forgo the estimated 1.9% cost-of-living increase that would otherwise have automatically gone into effect unless the Senate voted to reject it.

The pay increase, also applicable to House members, would boost the salary for rank-and-file lawmakers by $3,100 to $165,200.

Linda Piazza : 10/18/2005 12:59:11 PM

Bottom of the triangle at about 550, top, 551.50. OEX now at 550.67.

Jonathan Levinson : 10/18/2005 12:56:31 PM

Awaiting the results of the 13B 4-week t-bill auction in the coming minutes. Currently, TNX is down 1 bp at 4.479% and IRX is up 6 bps at 3.757%.

Tab Gilles : 10/18/2005 12:55:43 PM

Eaton Vance Limited Duration Income Fund (TLT) Link

Jonathan Levinson : 10/18/2005 12:55:48 PM

I don't believe that this was reported earlier, but the Bank of Canada raised rates by 25 bps to 2.75%, citing an economy operating near capacity and rising energy prices. This was a widely expected move, and CAD futures are up all of .06% at .8484 here.

Linda Piazza : 10/18/2005 12:50:05 PM

OEX couldn't make it above the top of its triangle once again. It turns down again toward the bottom of that triangle, now down at about 550. The OEX is at 550.73 as I type.

Jeff Bailey : 10/18/2005 12:48:16 PM

Dynamic Materials (BOOM) $20.95 +5.32% ... 15-minute interval chart with our retracement work, and WEEKLY Pivot Levels. Volume turned on gives observation our retracement levels very much a focus. Chart at this Link

Linda Piazza : 10/18/2005 12:45:53 PM

OEX creeping up to the top of the triangle again, with that at about 551.51, site of the descending trendline off yesterday's high. The OEX is at 551.36 as I type, above the 30-minute 100-ema but below the 130-ema at 552.20. The OEX has not been able to close a 30-minute period above the 30-minute 100-ema today.

Jonathan Levinson : 10/18/2005 12:43:10 PM

QQQQ's 30 and 60 min cycles are in downphases this morning, the 30 from a bearish divergence. Against this setup is a short cycle upphase only now staggering toward overbought territory. With price holding within a 20 cent range this morning, none of these cycles are getting anywhere near their normal traction. I believe that this is opex week distortion skewing our indicators, but the lack of impact from all those overdue, bearish divergent cycles is certain a boon to the bulls. Link

Jeff Bailey : 10/18/2005 12:35:40 PM

SMH / SOX.X Compents at this Link ... Note: SOX.X did trade MONTHLY S1 again this morning.

Linda Piazza : 10/18/2005 12:32:45 PM

The OEX couldn't maintain its breakout above the upper trendline of the triangle within its triangle, so it dropped down to test the bottom rising trendling of that small triangle within the triangle. Just more chopping, although the advdec line does hint that it might need to fall back and test support again before rising further, if it's going to rise any further.

Jonathan Levinson : 10/18/2005 12:30:31 PM

Volume breadth is down to -1.8:1 on the NYSE, -1.06:1 on the Nasdaq.

Jeff Bailey : 10/18/2005 12:25:53 PM

Dynamic Materials (BOOM) $20.68 +3.97% ... updated bar chart at this Link

Linda Piazza : 10/18/2005 12:18:22 PM

Not much to be gleaned from a study of the OEX's 15-minute Keltner charts, either, as they're settled into an equilibrium position, with the result that the OEX is ringed by support and resistance that look about equally weighted. That's about right for a time when the OEX is coiling within a triangle, though, isn't it?

Jeff Bailey : 10/18/2005 12:17:32 PM

12:00 Internals found at this Link

Jonathan Levinson : 10/18/2005 12:15:37 PM

QQQQ's sideways range today is holding at the center of a rising channel/wedge in place off last Thursday's low. Yesterday's decline broke a steeper support line, and price is holding below that primary line this morning. I've left it off because the chart is already overly cluttered. Nonetheless, we see that 38.00 QQQQ is significant not just in terms of opex support- it's also the secondary rising trendline off last week's low: Link

Linda Piazza : 10/18/2005 12:12:25 PM

OEX coming up for the top-of-the-triangle test now. Advdec line climbing, but moving into a possible resistance band.

Linda Piazza : 10/18/2005 12:10:59 PM

The OEX bumped just above the smaller triangle's resistance, the triangle within the triangle, but it hasn't cleared the resistance of the larger one, now at about 551.61-551.65, depending on where the cursor is placed.

Jeff Bailey : 10/18/2005 12:10:48 PM

Dynamic Materials (BOOM) alert $20.43 +2.71% ... gets active.

Linda Piazza : 10/18/2005 12:04:59 PM

Bulls, if the OEX should break through that triangle to the upside, be prepared to raise stops quickly and perhaps take partial profits near or between 552.30-553.40. That resistance may be strong, despite the fact that the OEX will have just confirmed an inverse H&S on such a rise, and many other indices face potentially strong resistance. I could see a short squeeze propelling indices higher, but there's just no guarantee that will happen. Have your plans ready. I've always thought there was potential for a rise into that level, but I just don't know if there's more.

Jeff Bailey : 10/18/2005 12:03:30 PM

12:00 Internals found at this Link

Tab Gilles : 10/18/2005 11:55:24 AM

Forgot this chart on previous post. Link

Linda Piazza : 10/18/2005 11:54:52 AM

The OEX now has a triangle within a triangle. The narrower one has top resistance at about 551.26--no surprise giving the number of resistance types there. The top one now crosses at about 551.65. The OEX is currently at 551.08.

Jonathan Levinson : 10/18/2005 11:52:41 AM

Stepping away to nurse a headache- back shortly.

Linda Piazza : 10/18/2005 11:52:15 AM

Advdec line rising to challenge that resistance band again, with resistance from about -1280 up to -700 currently and with the advdec line currently at -1380, QCharts value.

Linda Piazza : 10/18/2005 11:44:53 AM

Not only is the OEX trading within that triangle, but it's trading in an increasingly tight range within that triangle, not even touching the upper or lower boundaries before reversing again.

Linda Piazza : 10/18/2005 11:42:23 AM

Advdec line hitting potential support.

Jonathan Levinson : 10/18/2005 11:41:10 AM

QQQQ volume has just surpassed half of yesterday's 64.2M, just over 1/3 of the 89.5M average daily volume.

Linda Piazza : 10/18/2005 11:38:45 AM

Just more chopping around with the triangle at the top of its climb for the OEX.

Jeff Bailey : 10/18/2005 11:28:32 AM

American Standard (ASD) $37.48 -14.97% Link ... Percentage loser at the big board after the manufacturer of air conditioning systems and bath/kitchen fixtures reported Q3 earnings of $159.1 million, or $0.74 a diluted share, compared with $156 million, or $0.71 a share, a year earlier. Excluding consolidation expenses and tax items, the company said it earned $0.75 a share. Consensus was for $0.78 a share.

Looking forward, ASD forecast a profit of $0.28 to $0.32 a share for Q4 and lowered its full-year earnings estimate to a range of $2.54 to $2.58 a share from $2.60-$2.75 a share. Analysts were expecting a per-share profit of $0.55 for Q4 and $2.68 for the year.

Linda Piazza : 10/18/2005 11:27:13 AM

OEX 15-minute Keltner picture: First resistance at 551.68, next at 552.56, all on 15-minute closes. First support at 550.65, and next in a band from 549.65-550.13, still looking relatively strong. RSI on that chart at a neutral-ish 55.01, not giving much information. That's to be expected when we have a coiling formation like the triangle we're seeing currently. OEX at 551.00 as I type.

Tab Gilles : 10/18/2005 11:26:54 AM

$NYA & NYC Link Link Link

Jonathan Levinson : 10/18/2005 11:26:46 AM

Volume breadth holds -1.77:1 on the NYSE, +1.04:1 on the Nasdaq. Crude oil is off its 63.175 low, trading -.875 at 63.475 here, natgas -.445 at 13.44 and 7 cents off the low. QQQQ continues to slide sideways below the 38.17-.20 confluence noted earlier, with the 30 and 60 min channels flat. Current channel resistance is at 38.25-.27, and while the short cycle is still up, it's doing no better than the downphase that preceded it. Link

Jeff Bailey : 10/18/2005 11:22:27 AM

Great Atlantic Pacific Tea (GAP) $29.22 +15.22% Link ... Percentage gainer at the big board after the company reported net income of $592 million, or $14.40 per share, compared with a loss of $64.2 million, or $1.67 per share in the year ago quarter.

The latest quarter included a gain of $919 million related to the sale of the company's Canadian operations and charges totaling $152 million for certain non-operating expenses, including $71 million for exiting some Midwest operations and $5 million for Hurrican Katrina.

Linda Piazza : 10/18/2005 11:22:21 AM

Top of the OEX's triangle formation is not at about 551.65. Remember the 30-minute 130-ema waits just above that, at 552.27, and the 38.2% retracement of the decline off the 10/3 high, at 553.38.

Linda Piazza : 10/18/2005 11:18:54 AM

It's looking to me as if the advdec line might climb up to -800 to -600, at least, although I'm not certain about upside beyond that. Meanwhile, the OEX is climbing toward the top of its triangle shape.

Linda Piazza : 10/18/2005 11:15:07 AM

Advdec line pausing below that resistance band I mentioned earlier. OEX still inside its triangle.

Jeff Bailey : 10/18/2005 11:14:42 AM

11:00 Internals found at this Link

Linda Piazza : 10/18/2005 11:12:23 AM

RUT up under the daily 200-sma and -ema's again, with those at 633.87 and 634.90, respectively, and with the RUT at 632.93. The 10-sma has joined the resistance offered by the other two, with that average at 634.12.

Linda Piazza : 10/18/2005 11:10:53 AM

BIX flat again.

Jonathan Levinson : 10/18/2005 11:10:32 AM

Nasdaq volume breadth ticks positive at +1.08:1 here, but QQQQ still struggles with 38.15 resistance.

Linda Piazza : 10/18/2005 11:08:27 AM

OEX approaching the 30-minute 100-ema again, with that average at 551.12 and the OEX at 550.85. Advdec line approaching next resistance band, too.

Linda Piazza : 10/18/2005 11:05:56 AM

Advdec line continuing to climb (if I can believe what I see on the charts this time). It will hit next resistance soon, in the -1100 area, extending up toward -600. It's at -1330 as I type.

Jeff Bailey : 10/18/2005 11:05:13 AM

11:00 Market Watch found at this Link

Jonathan Levinson : 10/18/2005 11:04:20 AM

QQQQ clears 72 SMA resistance at 38.10 and is here testing the previous intraday high at 38.15: Link

Jonathan Levinson : 10/18/2005 10:59:56 AM

Volume breadth -2.21:1 on the NYSE, -1.16:1 on the Nasdaq.

Linda Piazza : 10/18/2005 10:57:12 AM

Bounce attempt from the bottom of the OEX's triangle, with the advdec line trying to bounce, too, tentatively rising above the lowered -1790 resistance zone (formerly -1550). The advdec line is now at -1581 and may be beginning that bounce that the 5- through 15-minute charts showed was possible. Nothing has followed through lately, so I'm still watching that triangle.

Jeff Bailey : 10/18/2005 10:56:29 AM

US Energy (USEG) $4.27 +4.65% Link ... retraces 50% of recent decline.

Linda Piazza : 10/18/2005 10:55:05 AM

I may have to be away for short periods several times today due to some developments concerning my granddaughter. If I am, continue to watch that triangle at the top of the OEX's climb for a breakout either direction. Be prepared to exit if the breakout is quickly reversed. If the breakout should be to the upside, bulls need to be particularly watchful of the 552.30-553.40 zone for potentially strong resistance.

Jeff Bailey : 10/18/2005 10:54:21 AM

Energy prices eased overnight on signs that Hurrican Wilma may be stalling ... recent update from NHC at this Link

Recent strike probabilities at this Link

Linda Piazza : 10/18/2005 10:51:58 AM

OEX testing 15-minute 100/130-ema's, at 549.71 and 549.98, respectively. The 100-ema is roughly congruent to the bottom of the OEX's triangle formation. Earlier, I mistook that MA for the five-minute one, so it would take a 15-minute close beneath 549.71 to confirm the breakdown out of the triangle. Obviously, some would not want to wait for a 15-minute close beneath that average. OEX at 550.07 as I type, with the rising support of that triangle now at about 549.76. I don't know why I'm so distrustful of the downside, but I'll warn again that if there's a break and then a quick bounce, bears need to consider that they might have been caught in a trap. OEX dropped to 549.90 as I typed.

Tab Gilles : 10/18/2005 10:49:11 AM

Murphy Oil (MUR) Seeing similarites to April/May bottom on MUR. Let's see if $42 level holds. Will look at possibly adding to position on 10/20-ema crossover. But also be aware of next weeks earnings report. [Those trading may consider consider using $42/ Fib level as a stop.] Link

Linda Piazza : 10/18/2005 10:47:44 AM

I don't believe there should be a bounce today based on what happened with the PPI, but charts haven't ruled that out as a possibility yet and several have suggested that a test of the 552.30-553.40 zone is possible. The fact that the OEX is within a triangle at the top of its climb at least presents the possibility of an upside breakout, although I'm certainly not one who counts on the OEX breaking out in either direction of such formations. I'm just not going to rule it out until the OEX breaks below the formation and sustains a break below it. The advdec line on some charts continues to present the possibility of a bounce, but only if certain not-yet-met conditions are met.

Jonathan Levinson : 10/18/2005 10:43:51 AM

QQQQ doesn't want to break 38, which isn't surprising given the peak 269.9K put open interest at that strike. Call open interest is heaviest at 39 for October, so we have our first guestimate at the opex closing range. That doesn't mean that the range can't get violated in the meantime, and I suspect that this is what the market is currently pondering as QQQQ holds pennies above 38.00 support.

Jeff Bailey : 10/18/2005 10:43:18 AM

SMH / SOX.X Components found at this Link

Linda Piazza : 10/18/2005 10:41:29 AM

OEX still inside the triangle at the top of its climb, with bottom support at about 549.78, although I might tend to use a five-minute close below the five-minute 100-ema at 549.71 as confirmation that a downside violation has occurred. The top resistance is at about 551.72. Beware of a fake-out move outside either boundary, and suspect that's what's happening if there's a piercing of either boundary and then a quick reversal. OEX at 549.98 as I type.

Jonathan Levinson : 10/18/2005 10:39:03 AM

TNX is up to a .6 bp loss at 4.483%, IRX down to a 7 bp gain at 3.767%.

Linda Piazza : 10/18/2005 10:38:46 AM

OEX Keltner support from 549.51-550.06 on 15-minute closes. OEX at 550.31 as I type.

Jonathan Levinson : 10/18/2005 10:36:28 AM

The bounce ended almost before it got started, and those waiting for a cycle top (such as me) never got a chance to sell it. The short cycle bounce is stalled but not yet reversed, but it looks like the sellers can't wait as new lows print here: Link

Linda Piazza : 10/18/2005 10:30:06 AM

Still a mixture of signs across a mixture of charts. No clear signals for me, with opposing bullish and bearish chart evidence. Advdec line shows the potential for a bounce but can't quite clear next resistance.

Jeff Bailey : 10/18/2005 10:29:50 AM

10 Most Active ... QQQQ $38.11 -0.18%, INTC $23.86 +1.70%, LU $3.13 -1.57%, SPY $118.74 -0.31%, MSFT $24.67 +0.57%, NT $3.52 +1.14%, NVAX $3.48 +6.42%, EWJ $11.71 -1.09%, CSCO $17.14 -0.17%, GDT $65.81 -9.07%

Jonathan Levinson : 10/18/2005 10:28:20 AM

The SOX is faring worse than QQQQ this morning, having tested 438 support at the low as the 30 and 60 min channels turn down: Link

Linda Piazza : 10/18/2005 10:28:10 AM

OEX 30-minute chart showing the potential inverse H&S, the Fib bracket on the decline off the 10/3 high, and the 30-minute 21/100/130-ema's: Link

Jonathan Levinson : 10/18/2005 10:25:57 AM

So far, the short cycle bounce is looking even weaker than the downphase which preceded it after tagging 38.15. Price continues to return to the 72 SMA at 38.10: Link

Jeff Bailey : 10/18/2005 10:24:52 AM

Sell Program Premium ... DIA $103.39, SPX 1,186.01, QQQQ $38.10

Jeff Bailey : 10/18/2005 10:24:07 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 10/18/2005 10:22:28 AM

Advdec line testing that -1550 zone again.

Linda Piazza : 10/18/2005 10:21:09 AM

OEX testing the 10-sma and the 30-minute 100-ema. OEX at 551.16 as I type.

Linda Piazza : 10/18/2005 10:20:42 AM

Advdec line still looking like a bounce remains at possibility at least, if not a probability.

Jonathan Levinson : 10/18/2005 10:17:11 AM

Crude oil reopens, -.475 at 63.875, off a low of 63.325. Natgas is -.42 at 13.465.

Linda Piazza : 10/18/2005 10:16:33 AM

Without my knowing it, my charting service was not giving me correct information on the advdec line, apparently. It wasn't until I changed servers that I got the updated information, and now I'm scrambling to review it. If what I'm seeing now is correct, the advdec line is now facing potentially tough resistance in the -1550 zone, but is closer to giving a buy than a sell signal on some time frames, and produced bullish value/RSI divergence on some charts. It needs to clear that resistance, however, and stay above it or at least maintain -1900 to -2000 or so on any further pullbacks, or it risks creating a breakdown signal with further downside, to the -3000 level, possible. It looks as if a retest of the -1900 zone will come first. Advdec line at -1721.

Jonathan Levinson : 10/18/2005 10:15:19 AM

Volume breadth improves to -2.1:1 on the NYSE, -1.13:1 on the Nasdaq.

Jeff Bailey : 10/18/2005 10:14:38 AM

10:00 Internals found at this Link

Yesterday's Internals found at this Link

Linda Piazza : 10/18/2005 10:10:56 AM

TRAN bouncing back to test its 200-sma.

Linda Piazza : 10/18/2005 10:10:41 AM

OEX about to hit the daily 10-sma and the 30-minute 100-ema again, with the 30-minute 100-ema at 551.15 and the 10-dma at 551.22, and with the OEX currently at 550.97.

Jonathan Levinson : 10/18/2005 10:08:44 AM

The short cycle indicators are flattening just above oversold territory, and despite the nearly 20 cent drop for QQQQ, the current move isn't enough to jeopardize the trending overbought 30/60 min cycles. If the short cycle upphase kicks off from here, there will be a good chance of a retest of the highs, because the downphase generated weak-neutral traction. The bears are running out of time to exploit that short cycle downphase: Link

Linda Piazza : 10/18/2005 10:07:08 AM

Advdec line charts are all over the place on different time frames, as they have been for several days, so they just are not giving me a good setup. The shorter-term ones, such as the five-minute, suggest a bounce possibility. The 60-minute has a potential RSI H&S, not a happy sight for bulls.

Jeff Bailey : 10/18/2005 10:03:55 AM

10:00 Market Watch found at this Link

Linda Piazza : 10/18/2005 10:03:12 AM

The OEX just closed the last 30-minute period a few cents below that 30-minute 21-ema. However, it closed at 15-minute Keltner support at 549.64-549.98, on 15-minute closes. That support still looks strong enough to prompt at least a bounce attempt, even if it doesn't get far. A strong downdraft would be needed to get the OEX past that possible support, which could happen, of course. Hasn't yet. The OEX is at 550.12, but with lots of time before this first 15-minute period is closed.

Jeff Bailey : 10/18/2005 10:00:34 AM

Semiconductor Index (SOX.X) 438.35 -1.43% ... probes last week's lows.

Linda Piazza : 10/18/2005 9:59:29 AM

Jonathan's notation about the Fed's actions this morning, in his 9:57:15 post perhaps throw some doubt on my best-guess action for the OEX, expressed in my 9:57:51 post. (I updated it, and that changes the original time stamp. It was originally posted before Jonathan's.)

Jonathan Levinson : 10/18/2005 9:57:14 AM

The Fed announces a 4.25B overnight repo against 13.75B expiring, for a large net drain of 9.5B. The stop out rate declined to 3.68 on treasury collateral, however, a 6 bp drop from yesterday, indicating a lesser demand for the money on the part of the Fed's dealers.

Jeff Bailey : 10/18/2005 9:57:08 AM

Novavax (NVAX) $3.54 +8.25% ... atop this morning's most actively trade after Wave Biotech, LLC, announced today that the company is working with a number of worldwide pharmaceutical and biotech manufacturers that are making vaccines in the disposable Wave Bioreactor. In its latest collaboration effort, Wave Biotech has entered into an agreement with Novavax and both companies will jointly collaborate on the development of a commercial scale production process for Novavax's pandemic influenza virus (avian flu) vaccine and other biological products. Wave Biotech will provide process and equipment expertise for the propriety technology based on disposable equipment for the manufacture of biologicals. The initial focus of the collaboration will be on Novavax's H5N1 avian-flu-Like Particle (VLP) vaccine. The joint collaboration will demonstrate in a production process that can express potent vaccine at high yield at the 500-liter scale.

Linda Piazza : 10/18/2005 9:57:51 AM

It may be close as to whether the OEX closes this first 30-minute period above the 30-minute 21-ema that has supported it on closes since mid-morning Friday, with that at 550.08 and with the OEX currently at 550.46. The OEX faces strong resistance just overhead, though, and I'm not getting any signals, either direction, from the advdec S/R levels. I still think it's possible that the 552.30 level at least and perhaps the 553.40 level might be tested, and I would advise some profit-protecting measures be enacted by bulls if that's approached.

Jonathan Levinson : 10/18/2005 9:53:14 AM

QQQQ trades back up to the 72 SMA at 38.10 on this bounce off the 38.03 low. 30 min channel resistance declines from 38.30 to 38.27, and a lower high on this bounce will confirm a rollover in the longer intraday cycles. Resistance is at 38.17-.20. Link

Linda Piazza : 10/18/2005 9:48:50 AM

OEX Keltner picture: The OEX is testing mid-channel support at 549.74-549.99 on 15-minute closes, with that support looking strong enough to bounce the OEX. The first resistance is at 550.68 on 15-minute closes, with resistance above that at 551.64-552.42.

Jonathan Levinson : 10/18/2005 9:48:25 AM

Awaiting the results of the Fed's announcement with respect to its 13.75B in expiring repos.

Jonathan Levinson : 10/18/2005 9:47:58 AM

Volume breadth -2.28:1 on the NYSE, -1.27:1 on the Nasdaq.

Linda Piazza : 10/18/2005 9:47:20 AM

OEX about to test that 30-minute 21-ema that's been supporting it on 30-minute closes since midmorning on Friday, with that average at 550.08 and the OEX currently at 550.20. Advdec still falling.

Linda Piazza : 10/18/2005 9:45:46 AM

BIX negative now.

Jonathan Levinson : 10/18/2005 9:45:42 AM

Session high for ten year notes, TNX down 2 bps to 4.469%. QQQQ tests the premarket low at 38.06.

Jeff Bailey : 10/18/2005 9:44:05 AM

Keene ... Fed bashing, inflation out of control, dollar demise, banks were set to go in the tank as Greenspan's monetary policy was all wrong. C'mon, you remember don't you? :)

Linda Piazza : 10/18/2005 9:42:34 AM

Advdec line still descending, now into a deeper level of possible support. There's not going to be hope for a bounce as long as it's descending, but once again, it's not at a point that gives me a good signal either for a bearish or bullish play according to the parameters I use.

Linda Piazza : 10/18/2005 9:41:11 AM

The OEX has held the support of its 30-minute 21-ema since mid-morning on 10/14. That MA is now at 550.10 on 30-minute closes, with the OEX dipping down to test it. The OEX is at 550.55 as I type.

Linda Piazza : 10/18/2005 9:39:55 AM

Advdec line dipping into the support zone, now at -520.

Linda Piazza : 10/18/2005 9:39:33 AM

Yesterday, the BIX printed a doji at the top of a three-day climb off last week's low, and I'm watching it today to see if it invalidates the potential reversal signal or looks as if it's confirming it. Right now, the BIX is trying to climb from its flattish opening level, but it's dealing with the 21-ema at 334.87. It's inched just a little above it. If the BIX can get a strong climb going and looks as if it's invalidating that potential reversal signal, that might tell us something about the OEX, but if it drops quickly, that tells us something different. So far, there's a tentative climb but nothing conclusive.

Jeff Bailey : 10/18/2005 9:40:36 AM

Novellus Systems (NVLS) $22.41 -9.96% Link ... Chip equipment maker sharply lower after reporting Q3 net income fell 64% year-over-year to $23.4 million, or $0.17 a share, due to a drop in shipments to chip makers. The company also said revenue fell 18.5% to $338.9 million.

Consensus was for $0.21 per share on revenue of $321 million.

Jonathan Levinson : 10/18/2005 9:38:53 AM

QQQQ's short cycle downphase is slowing in the early going as a wavelet upphase opposes it. That upphase should be complete within the next 2-5 minutes. Bears need a break of the premarket low at 38.06 to stall the 30 min cycle and start turning that channel down. Link

Keene Little : 10/18/2005 9:38:46 AM

You lost me Jeff. Would that be the part of the spring 2004 where we rallied strongly, or where we declined strongly? That was a wild period in the market.

Linda Piazza : 10/18/2005 9:36:11 AM

OEX Keltner picture: Nearest support at 550.86 on 15-minute closes. Nearest resistance at 551.77, but stronger at 552.41. OEX at 551.31 as I type, with an obvious effort to hold the daily 10-dma and the 30-minute 100-ema.

Linda Piazza : 10/18/2005 9:34:55 AM

Advdec line falling back from the opening level, but falling into support that thickens beginning at about -125 and extending down to about -450. It's at -70, QCharts value, as I type. If that support is held, there's a chance for a climb, but then resistance begins not far overhead, either, near +450-500.

Jonathan Levinson : 10/18/2005 9:33:11 AM

Volume breadth -1.47:1 on the NYSE, -1.21:1 on the Nasdaq.

Linda Piazza : 10/18/2005 9:31:55 AM

OEX opens just above the important 30-minute 100-ema and dips down to retest it. That's at 551.18, with the OEX at 551.34, and with that MA important on a 30-minute close. OEX at 551.49 as I type. The daily 10-sma is at 551.26.

Jeff Bailey : 10/18/2005 9:31:39 AM

And while it feels like fall, it is starting to sound like the spring of 2004 this morning Keene.

Keene Little : 10/18/2005 9:19:01 AM

Jonathan, I just read your 8:59 comment. People here know that I'm not a Greenspan fan. His shenanigans over the years to save his own reputation have been nothing less than criminal. I hope history judges him harshly. However, my greater fear is who will replace him in January. Ben "printing press" Bernanke? I'll have a field day with him :-)

Jonathan Levinson : 10/18/2005 9:16:25 AM

TNX is now down .8 bps at 4.481%, IRX up 9 bps at 3.787%. My guess is that TNX will reverse higher from here- 4.4% is important confluence support.

Jonathan Levinson : 10/18/2005 9:06:59 AM

QQQQ updated with premarket data: Link

Jonathan Levinson : 10/18/2005 9:05:49 AM

Jane, I don't have a clue, as I'm focused on the US markets. She should discuss it with her accountant, if she hasn't already. Generally, the Income Tax rules seek to compensate for double taxation via offsetting credits or some other mechanism, but because I've never dealt with the issue, I can only guess.

Jane Fox : 10/18/2005 9:00:57 AM

Jonathan have you heard very much about the taxing of Income Trusts in Canada. My sister was heavily invested in these and they took a huge hit yesterday due to the government talking about double taxing them.

Jane Fox : 10/18/2005 8:59:36 AM

Dateline WSJ Inflation at the wholesale level last month soared by the largest amount in more than 15 years, reflecting a hurricane-spurred surge in energy prices, while so-called core inflation pressures also appeared to gain momentum.

The Labor Department reported that the producer-price index jumped 1.9% in September -- the biggest jump since an identical increase in January 1990 -- led by surging prices for gasoline, natural gas and home heating oil after the widespread shutdowns of refineries and oil platforms along the Gulf Coast. Food prices, which had been declining, posted the biggest increase in 11 months as the price of eggs shot up by a record amount.

The uptick in inflation wasn't confined to the typically volatile food and energy sectors, however: excluding those costs, inflation posted a worrisome increase of 0.3% after showing no increase at all in August.

Jonathan Levinson : 10/18/2005 8:59:18 AM

Marc, recall that after 9/11, consumer were told to borrow and spend and live it up. Last year (if memory serves), Greenspan observed publicly that homeowners would have saved a fortune had they used adjustable rate instead of fixed rate mortgages. We now have record numbers of bankruptcies, a huge percentage of total home loans held via ARMs, household debt:equity ratios at record highs, and an energy rally.

Jonathan Levinson : 10/18/2005 8:52:05 AM

The high headline number on the PPI, combined with anticipated rate hikes in Europe and Canada, and the ongoing energy/real estate rallies... all these factors severely limit the Fed's ability to ease, whether via a halt to the rate hikes or surreptitiously via the daily open market operations. The 13-week t-bill rate is up 9 bps here at 3.787%, while the TNX is dowbn .2 bps at 4.487%. While timing is everything, I see nothing bullish in it for equities, particularly so close to their recent highs and with the USD Dollar Index holding the 90 level. If the Fed needs to tighten to deflate any of the rallies it has already acknowledged, or to keep up with other countries, or merely to restore a neutral stance, I would expect equities to go down more easily than oil or other commodities, whose demand is relatively inelastic.

Linda Piazza : 10/18/2005 8:45:56 AM

The OEX ended the day yesterday just above its daily 10-sma, and above the much-tested 30-minute 100-ema at 551.18. The evidence was contradictory all day, with a potential inverse H&S building but with the neckline just under the 38.2% retracement of the decline off the 10/3 high into the 10/13 low. Keltner resistance lies overhead, too, at 552.39 on 15-minute closes. I'll be watching the setup closely this morning, for either a pop-and-drop type setup early in the morning or for signs that the OEX is confirming that inverse H&S and might actually build on the recent climb. If you're bullish and believe in more upside, you might use a 30-minute close above the 30-minute 130-ema, currently at 552.38, as confirmation of that inverse H&S, but be aware of that 553.40-ish resistance just overhead. I think anyone entering a long play would then have vulnerability to a retest of the 30-minute 100-ema, currently at 551.18, and would need to exit on a violation of that on a 30-minute close. I think the better long play would have been an entry about last Thursday, however, but my parameters set the trade up a day too early. If you're bearish instead, you'll be thinking of a test of the 553-ish zone as an opportunity for a bearish entry.

As for me, I'm going to be watching internals closely this morning to see what they show us. Perhaps nothing. I was about to type that they showed us nothing yesterday, but that's not true. They showed that there was much opportunity for chop, and that's what we got. I will specifically be watching for the possibility of a pop-and-drop type move if the OEX bounces first thing this morning, although the reaction to the PPI data questions whether that bounce will occur.

Jane Fox : 10/18/2005 8:42:10 AM

Jonathan too funny. And of course I have seen small dogs climb fences as well but this dog sounded kinda big.

Jonathan Levinson : 10/18/2005 8:41:02 AM

Oct. 18 (Bloomberg) -- European consumer prices rose in September at the fastest pace in more than three years after oil prices reached a record, making it more likely the European Central Bank's next shift in interest rates will be an increase.

Consumer prices in the dozen nations using the euro climbed 2.6 percent from a year earlier, after gaining 2.2 percent in August, Eurostat, the European Union's Luxembourg-based statistics office, said today. That's the highest since January 2002, exceeding the 2.5 percent estimate published Sept. 30.

Link

Jonathan Levinson : 10/18/2005 8:39:55 AM

Jane, some dogs are really smart. My brother's Jack Russell could have picked the lock without making a sound. Here's a pic: Link

Jonathan Levinson : 10/18/2005 8:32:20 AM

QQQQ dived from that 38.25 high, currently -.05 at 38.13, ten year notes down 1/4 at 108 49/64, TNX +2.1 bps at 4.51%.

Jonathan Levinson : 10/18/2005 8:31:19 AM

Headlines:

U.S. PPI UP 6.9% YEAR-ON-YEAR, MOST IN 15 YEARS

U.S. CORE PPI UP 2.6% YEAR-ON-YEAR

U.S. SEPT. INTERMEDIATE PPI UP 2.5%, MOST IN 31 YEARS

U.S. SEPT. CRUDE PPI UP 10.2%

U.S. SEPT. PPI ENERGY UP 7.1%, 15-YEAR HIGH

U.S. SEPT. CORE INTERMEDIATE PPI UP 3.5% Y-O-Y

U.S. SEPT. PPI UP 1.9% VS. 1.2% EXPECTED

U.S. SEPT. CORE PPI UP 0.3% VS. 0.2% EXPECTED

LARGEST GAIN IN PPI IN 31 YEARS

U.S. PPI UP 6.9% YEAR-ON-YEAR, MOST IN 15 YEARS

Link

Jonathan Levinson : 10/18/2005 8:24:23 AM

QQQQ is hitting 38.25 here, at the top of (but not exceeding) the 30 min cycle channel. The 30 min cycle downphase has whipsawed to the upside very early in its run, just like it did on Friday afternoon. The 60 min cycle is trending in overbought, sliding sideways with little oscillation. The short cycles are also due for a downphase. The uncertainty comes from the bottomy (but not yet turning) daily cycle, and the declining volume on this flaggish, unconvincing bounce that Jeff noted yesterday. Link

Jonathan Levinson : 10/18/2005 7:48:09 AM

Equities are green, ES trading 1194.75, NQ 1558.5, YMN 10383 and QQQQ +.03 at 38.21. Gold is down 2.50 to 474.20, silver is down .048 to 7.821, ten year notes are flat at 108 59/64, crude oil is down .80 at 63.55 and natgas is down .38 at 13.505.

We await the 8:30 release of the PPI and Core PPI, est. 1.2% and .2% respectively, and at 9AM, Net Foreign Holdings.

Linda Piazza : 10/18/2005 7:08:39 AM

Good morning. The Nikkei dropped again, but most other Asian markets closed higher. European markets are modestly higher. As of 7:00 EST, gold was down $2.00, to $474.60, and crude, down $0.98, to $63.38. More details about Asian and European markets follows in succeeding paragraphs.

Tuesday morning, the Nikkei coiled around the flat-line level, with automakers gaining in earliest trading. The dollar was hitting two-year highs against the yen, with that action good for Japanese exporters. Following a pattern established the last few days, however, the Nikkei dropped in the afternoon. It closed lower by 48.05 points, at 13,352.24.

Before the market open, the Bank of Japan released its September manufacturers' input/output price indices. Input prices rose 0.6% month over month, with domestic input prices rising 0.1% and imports, 2.9%. The output price index climbed 0.2% month over month, with domestic rising 0.2% and exports, 0.0%. As a result of the higher materials and energy costs, September's trade condition index fell 0.4 points month over month and 3.5 points year over year.

Steel-related, oil-related and bank shares tended to rise. Techs tended to fall. UBS AG trimmed its rating on Tokyo Broadcasting System, sending that stock lower in early trading. Computer network company Net One Systems Co. also headed lower after the company lowered its full-year net income and sales forecasts. Fujitsu said it would probably report a profit for the first half instead of the previously expected loss, but kept its full-year forecast unchanged. The company said the IT demand environment wasn't clear for the second half.

Most other Asian markets rose. The Taiwan Weighted gained 0.08%, and South Korea's Kospi climbed 0.84%. Singapore's Straits Times fell 0.19%, but Hong Kong's Hang Seng rose 0.39%. China's Shanghai Composite gained 0.87%. A Chinese brokerage is reportedly seeing interest separately from CSFB, HSBC and Citigroup. Ericsson has won a contract to expand the GSM networks of two Chinese mobile operators.

Many European markets gain as crude prices retreat, although gains are modest so far. Last night, the Irish Times reported that the discovery of bird flu virus in Greece has prompted foreign ministers of European countries to call an emergency meeting to discuss the possibility of an influenza pandemic. In Germany, September's PPI rose 0.4%, with the year-over-year rate rising to 4.9%. The preliminary EU-harmonized figure had been 1.9%, remaining below the EU target, although that's mainly because firms have not been able to pass on their increased energy-related costs. The final number was due to be released later, I believe. The important ZEW expectations index for October was also released. That had been expected to rise, and it did, but not by as much as expected. It rose to 39.4 from September's 38.6. The current climate and Eurozone expectations both rose, but political uncertainties still appear to be impacting expectations.

In France, August's current account showed a narrowing of July's deficit, but still a deficit. In the U.K., the RICS September housing data stood at -21, showing that house prices fell at a slower rate than they had in more than a year. This number and one released yesterday both showed improvement in recent weakness, but still some weakness, encouraging some to believe that the Bank of England might ease rates in November. The September CPI was softer than expected, up 0.2% month over month. Still, the year over year rate climbed to 2.5%, above August's 2.4%. Core CPI was steady, rising 1.7% year over year.

IBM's report may have helped Capgemini, although not all European IT-related companies gained. Drugmakers were in the news, with Germany's Altana posting strong gains after the WSJ speculated that it was close to a sale of its pharmaceutical business. Novartis gained after its earnings report. Schering AG gained after announcing that it would have the exclusive, worldwide license to Sonus Pharmaceuticals' Tocosol Paclitaxel anti-cancer drug. AstraZeneca dropped after a firm in India filed papers to produce a generic version of its heartburn medication, Nexium.

As of 7:00 EST, the FTSE 100 was higher by 10.60 points or 0.20%, at 5,297.10. The CAC 40 was higher by 1.55 points or 0.3%, at 4,490.76. The DAX was higher by 7.79 points or 0.16%, at 4,986.62.

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