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OI Technical Staff : 10/25/2005 9:59:59 PM

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Jeff Bailey : 10/25/2005 9:08:35 PM

December Crude (cl05z) Link with a reverse head/shoulder retracement. Bounce for the major indices came just as I was typing 03:27:48 comments on XLNX and oil's settlement below $62.47.

Maybe a coincidence, maybe not.

Jeff Bailey : 10/25/2005 9:01:00 PM

e-mini S&P (es05z) intra-day chart with some goold old fashioned buying late in the session at this Link and has the look of some determined buying.

We looked at the SOX.X chart today, and I was just "sure" we would see a re-test of its MONTHLY S2 and first test of WEEKLY Pivot. We didn't. Not today at least.

Jeff Bailey : 10/25/2005 8:45:14 PM

SPY ... there was some action at the 03:37 PM EDT mark in the Nov $118 Put (SPY-WN) (3,003:102,641) @ $1.00, but hardly enough to trigger the pop to the close, or VIX.X action. My opinion anyway. Maybe OEX or QQQQ/NDX.

Jeff Bailey : 10/25/2005 7:39:12 PM

I don't see any particular option in SPX options chain (among today's most active) as overly active late this afternoon. Most actives today with VIX.X finishing 14.53 -0.21% were Nov 1100 Put (39,052:11,178), Nov 1100 Put (36,743:77,715), Nov 1075 Put (30,336:72,826), Nov 1065 Put (25,657:66,148)

Jeff Bailey : 10/25/2005 6:44:23 PM

CBOE Oil Index (OIX.X) conventional 4-point box chart (wide) at this Link

Jeff Bailey : 10/25/2005 6:40:00 PM

NYSE Composite ($NYA.X) conventional 20-point box chart (wide) at this Link ... study past "May lows" that currently tie in with NH/NL ratio action. Get a feel for what to expect, what NOT to expect.

Jeff Bailey : 10/25/2005 5:52:45 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 10/25/2005 5:38:14 PM

Closing Internals found at this Link ... NYSE NH/NL ratio chart at this Link where at today's close, the NYSE 10-day NH/NL ratio reverses up 3-boxes to 16%.

Looks very similar to that found in the Spring of 2004.

Jeff Bailey : 10/25/2005 4:33:58 PM

There was a quick decline in the VIX.X from the 14.90 level at 03:37 PM EDT. I'll check some SPX and OEX options chains, see if we can't find the contract that was traded most.

SPX lurched higher from the 1,192.00 level, SPY was trading $119.26. OEX was trading 550.67.

Jeff Bailey : 10/25/2005 4:10:54 PM

"Sell Program Premium" ... DIA $103.70, SPY $119.65.

Jeff Bailey : 10/25/2005 4:19:44 PM

Current OPEN MM Profiles found at this Link ... Today's Activity ... Swing trade bearish stopped out on the remaining 1/4 bearish position in Dynamic Materials (BOOM) at $20.32 ($0.00, or 0.00%). Stock closed $20.90 +3.46%.

Day trade short full position in Xilinx (XLNX) at $23.44, close out 1/2 late this afternoon at $23.77 ($+0.07, or +0.33%).

Holding remainder 1/2 XLNX overnight with stop at $23.60, targeting $23.14. (QCharts' WEEKLY Pivot Levels are $20.23, $21.95, Piv= $22.97 $24.69, $25.71.

Linda Piazza : 10/25/2005 3:56:43 PM

As a reminder, I will likely not be here tomorrow at the open or for most of the day. I'm not sure how long the various appointments will take.

Linda Piazza : 10/25/2005 3:55:57 PM

So far, the SPX hasn't been able to make it back to the 200-sma this afternoon.

Linda Piazza : 10/25/2005 3:54:21 PM

That might have been just the last-ditch bullish effort, stopping out a lot of bears. The advdec line is still attempting to climb,although up to next resistance at -1360, with the advdec line now at -1482, QCharts value. This is a frustrating market to trade, but if you've been following my posts, you took partial profit earlier and then likely got stopped, if you did, at a profitable or breakeven level on the rest of the position. If so, congratulate yourself for collecting some profits on a day like this. As I said, I'm somewhat skeptical of the bounce this afternoon, but taking profits are almost never a bad idea.

Jonathan Levinson : 10/25/2005 3:54:19 PM

Mark, it bounced at support within a daily cycle upphase. That upphase should finish at a lower high, but until it starts to peak or roll over, these bounces from higher 30 min cycle lows can be expected. It felt like it wanted to fall apart, but there was too much support, and the daily cycle bulls aren't done yet. A lower 30 min cycle high on this run could get them a lot closer, though.

Linda Piazza : 10/25/2005 3:48:17 PM

The OEX moved high enough to invalidate that larger H&S that it's been forming on its ten-minute chart. I have my suspicions about the spike, as the OEX seems to have been used a lot lately to bulldoze the markets higher, often leading moves in the advdec line rather than the other way around. However, because of the doji possibility today, I've been warning short-term bears to keep lowering their stops, and so many are probably stopped out. Those who aren't will have a tough decision to make if the OEX ends the day with that doji, and expecially if the SPX ends the day back at its 200-sma.

Such OEX doji days are often followed by another doji day or an actual decline the next day . . . until it breaks out of its consolidation formation.

Jeff Bailey : 10/25/2005 3:46:36 PM

A closing bid for some chips! ... KLAC $48.68 +0.55%

XLNX $23.56 -0.08% ...

Linda Piazza : 10/25/2005 3:43:03 PM

Remember that doji possibility that I mentioned for today? It's looking more possible now, although the last few minutes of the day will tell the tale. When consolidating, the OEX often follows such doji days with either a decline or another doji.

Linda Piazza : 10/25/2005 3:41:01 PM

For the first time today, the advdec line is pushing above resistance that's currently at -1880, but moving toward next resistance in the -1490 to -1325 levels. Advdec line at -1684 as I type.

Jonathan Levinson : 10/25/2005 3:40:42 PM

The 30 min cycle downphase is losing it grip as price trades both sides of the 72 SMA for the past hour. While the indicators never maxxed out in oversold and the 60 min cycle continues to point lower, price is back to where it started several hours ago and price has not lost its broader rising trend. Link The daily cycle upphase continues, and so far, today's weakness is looking only corrective within that broader daily cycle upphase.

Linda Piazza : 10/25/2005 3:39:32 PM

OEX testing the 60-minute 100-ema again, with that at 551.43 and the OEX currently at 551.27. MOC orders due any moment, and we'll see where they send the markets.

Jeff Bailey : 10/25/2005 3:38:28 PM

Bearish day trade stop alert .... on 1/2 short in Xilinx (XLNX) $23.37 -0.89% here.

Jeff Bailey : 10/25/2005 3:37:25 PM

Bearish day trade lower stop alert on 1/2 of the Xilinx (XLNX) $23.33 -1.06% short to ... $23.37. Cover this 1/2 should it trade $23.26 to the close.

Linda Piazza : 10/25/2005 3:36:30 PM

OEX Keltner picture: The OEX is finding resistance on 30-minute closes at the Keltner line currently at 550.81, and is finding support at the Keltner lines currently at 549.82-550.01. Needs to break one or the other. OEX at 550.55 as I type.

Linda Piazza : 10/25/2005 3:34:18 PM

The OEX closed that last ten-minute period just a touch above the 10-minute 21-ema, currently at 550.71, but just a few cents above it, and the OEX is now at 550.68. It still looks as if this could be just part of the right-shoulder chop, but this right shoulder is more volatile than the left, and I'm not quite sure what that means. I would not be surprised to see some mighty attempts to keep that H&S from confirming, into the close, but the advdec line is just not confirming this attempted bounce yet.

Jonathan Levinson : 10/25/2005 3:31:05 PM

SAN FRANCISCO (MarketWatch) -- Forecasts for cold weather in much of the U.S. drove natural-gas futures up over 10% to a record close Tuesday. The November contract rose $1.334 to close at $14.338 per million British thermal units -- the highest-ever closing level for a front-month contract. On an intraday basis, however, the session's $14.38 high was still below the all-time intraday record of $14.75 from Oct. 5. December crude closed up $2.12 at $62.44 a barrel. November heating oil added 5.2% to finish at $1.8899 a gallon and November unleaded heating oil tacked on 4.6% to end at $1.6538 a gallon.

Linda Piazza : 10/25/2005 3:28:45 PM

The OEX is rising to test the 10-minute 21-ema from the underside, with that average at 550.72, important on 10-minute closes. The OEX is also at 550.72 as I type. I wouldn't be surprised to see an attempted run higher occur somewhere through here, but bears would prefer to see that average hold on 15-minute closes. The OEX is again attempting to front-run the advdec line, though, as it isn't bouncing much.

Jeff Bailey : 10/25/2005 3:27:48 PM

Xilinx (XLNX) $23.32 -1.10% ... day trader's alert ... I would like to hold 1/2 of this short overnight, but will look to close out 1/2 into the close.

December Crude Oil settled at $62.44, and couldn't quite hold a trade above $62.47, thus my thoughts that there are some oil bulls with jitters into tomorrow's EIA data.

Meanwhile, SOX.X 440.50 -1.40% hasn't seen a test of correlative WEEKLY Pivot and MONTHLY S2 today. A gap, or strong move below this key level of weekly support worth holding some XLNX short overnight.

Linda Piazza : 10/25/2005 3:24:39 PM

Nope. The OEX isn't through yet with the potential right-shoulder-building exercise.

Jonathan Levinson : 10/25/2005 3:22:42 PM

Volume breadth is back down to -2.28:1 on the NYSE, -1.83:1 on the Nasdaq.

Linda Piazza : 10/25/2005 3:20:28 PM

OEX dropping toward a test of its previous 549.37 LOD. OEX at 549.53 as I type.

Linda Piazza : 10/25/2005 3:19:07 PM

It would be nice for the bears for the OEX to go ahead and reach a new LOD, likely confirming that H&S on its 10-minute chart although it hasn't been chopping around as long as it did on the left-shoulder building exercise. The advdec line's resistance held, and a drop down to -2800 or so is possible, with the 60-minute target even lower, near -3200. Those 60-minute targets are seldom met, however.

Jonathan Levinson : 10/25/2005 3:13:26 PM

QQQQ ticked briefly above the trendline and 72 SMA, but it whipsawed quickly back down. The 30 min cycle downphase is only now reaching oversold territory, still with room to run, while the 60 min cycle is just reaching the halfway point of its range. QQQQ bears need a break of S1 at 38.73 to reignite the decline and resume the decline in the 30 min channel. Channel support has been holding at 38.70 for the past half hour. Link

Linda Piazza : 10/25/2005 3:12:17 PM

Speaking of traveling with my daughter to take her daughter to see specialists, I will be doing so tomorrow, going with my daughter to Fort Worth to the children's hospital there. I don't think I'll be on the MM at the open, although there's a possibility that I will, and then I should be away much of the day. I'm not sure how long tomorrow's testing will take.

Jeff Bailey : 10/25/2005 3:11:49 PM

03:00 Internals found at this Link

Linda Piazza : 10/25/2005 3:11:04 PM

Yes, Mark, I travel quite a bit with my daughter as she takes her daughter all across Texas to visit the specialists she needs, and I miss the Tahoe, too. Thank goodness I don't have long legs, because there's not a lot of leg room in her new vehicle, but at least Emmi's carseat and her other daughter's both fit in it.

Linda Piazza : 10/25/2005 3:08:39 PM

So far, the advdec line's resistance is holding. The advdec line is now at -1961, having been testing the -1800 to -1700 resistance. The OEX is rattling around in the right-shoulder area for its newest H&S. We won't know whether that formation is going to be invalidated or confirmed until it is, but as long as the advdec line's resistance holds, there's the possibility at least that the break will be to the downside. We, unfortunately, could see chop through to the end of the day, though, if the right shoulder is to be symmetrical to the left, with the left taking more than three hours of trading to form.

Linda Piazza : 10/25/2005 3:06:05 PM

A CNBC guest commentator this morning talked again about how well the economy is holding up and how little inflation there is despite the higher crude prices. My youngest daughter is 25 and most of her friends are twenty-something's, up to about 30. I can tell you that almost every one of them has made lifestyle changes because of the cost of filling their tanks. One now drive his motorcycle almost everywhere he goes. They pair up and ride together to church and to outings, planning them more carefully. They stay home more and get together less often because they're scattered across the city. One is planning on selling his home to be closer to his work. One is looking for a higher-paying job. Despite her own daughter's disabilities and the need for a specialized carseat that is bulkier than normal and hard to fit into just any vehicle, my daughter's Tahoe was traded in for a more fuel-efficient vehicle this summer. It is making a difference in these young people's lives. Don't tell them there's no inflation, as they're suddenly buying a whole lot less for their money.

Jeff Bailey : 10/25/2005 3:03:04 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 10/25/2005 3:01:24 PM

Ten year note yields finished +6.2 bps at 4.508%, 13-week bill rates +7.2 bps at 3.837%.

Jonathan Levinson : 10/25/2005 3:00:39 PM

Headline:

DEC CRUDE ENDS AT 1-WK HIGH OF $62.44/BRL, UP $2.12, OR 3.5%

Linda Piazza : 10/25/2005 2:58:25 PM

So far, the RLX hasn't been able to effectively retest the 60-minute 100/130-ema's that it broke through earlier today. It is trying to steady, currently producing a doji on that chart, so a bounce up to retest those averages can't be ruled out just yet.

Jonathan Levinson : 10/25/2005 2:56:25 PM

Volume breadth +2:1 on the NYSE, +1.66:1 on the Nasdaq.

Linda Piazza : 10/25/2005 2:56:07 PM

Advdec line now climbing into the next resistance, at -1800 to -1700. Advdec line now at -1845, having just risen to -1818.

Jonathan Levinson : 10/25/2005 2:49:56 PM

Crude oil finished +2.075 at 62.40, off a high of 62.55, while natgas finished +1.305 at 14.48, at the session high.

Linda Piazza : 10/25/2005 2:48:50 PM

The OEX is front-running the advdec line again, with the OEX running up to the right shoulder area for its new potential H&S. The advdec line is beginning to perk up a little, but only a little, and the OEX actually led the charge. The advdec line is still only at -1952, not yet risen above -1800 to -1700 next resistance.

Jonathan Levinson : 10/25/2005 2:44:17 PM

QQQQ continues to hold at the broken trendline from below, and just below 72 SMA resistance at 38.87. The short cycle indicators have turned up, but it could well prove to be a deadcat bounce if the bulls can't power it back over the 72 SMA and ultimately the 38.96 confluence line. Link

Linda Piazza : 10/25/2005 2:40:50 PM

The OEX is testing the descending trendline that formed this morning's H&S version's neckline, with that H&S now the head of the larger formation. Just part of the possible right-shoulder building exercise so far. The advdec line is climbing, too, but only to test next resistance. So far. Bears would like to see it stay beneath about -1800 to -1700. It's at -1997 as I type, QCharts value.

Linda Piazza : 10/25/2005 2:37:02 PM

We've now had one hour of the right-shoulder building attempt on the newest potential OEX H&S, out of the more than three hours it took to build the left shoulder. I certainly was hoping that we wouldn't have to wait more than three hours while the OEX chopped around and formed a right shoulder, for the symmetry with the left shoulder, but it's entirely possible that we'll have to wait that long to know whether this formation confirms or is invalidated. I'm still hoping that's not true.

Jeff Bailey : 10/25/2005 2:35:20 PM

10-year YIELD ($TNX.X) up 5.8 bp at 4.504% and has moved above WEEKLY R1 here.

4.50% is a "psychological level" for bond traders, but can also get attention from equity traders.

Question to ask, then monitor for in coming sessions is .... 1) Inflation?, or 2) asset allocation (sell bonds, buy equities).

SPX 1,190.54 -0.75% has slipped back under its WEEKLY R1 today, after trade above yesterday.

QQQQ $38.83 -0.84% ... same action as SPX.

Pacholder High Yield (PHF) $9.10 +1.11% ... rather tough here with SEC yield of 9.89%.

Linda Piazza : 10/25/2005 2:30:12 PM

The RLX looks as if it will close the current period far below the 60-minute 100/130-ema's, barring a strong bounce in the last few minutes of this period. A bounce isn't precluded, but this is a definite trend change since 10/19, when it zoomed above those averages. QCharts draws an ascending regression channel off last week's low with support now at about 430.45, but still rising, so that level should be watched for potential support. The actual ascending trendline off last week's low is lower, at about 426.27, but ascending, of course.

Jonathan Levinson : 10/25/2005 2:25:49 PM

Session low for 10-yr notes here at 108 3/4, TNX +5.6 bps at 4.502%. IRX is up 7.2 bps at 3.837%.

Linda Piazza : 10/25/2005 2:25:35 PM

First Keltner resistance on the OEX at 550.50-550.72, on 15-minute closes. First support at 549.52-549.67 on 15-minute closes. OEX at 549.60, but still some time before the 15-minute close. OEX 547.56 and maybe lower looking more possible. Since I've been back from my brief absence today, the advdec line hasn't risen high enough to give us a new bearish entry, but it's so far being pressured down toward -2800, now at -2137. Bullish divergence continues, and so does the possibility of a bounce at any time, but about -1700 should be relatively strong resistance now.

Jonathan Levinson : 10/25/2005 2:21:17 PM

QQQQ has broken the rising trendline, reaching as low as 38.78, currently bouncing back to the broken line. This is still within the range of a throw-under/headfake, which is what the bottomy short cycle indicators want to say. But with the 30/60 min channels pointing south together, the probability of an oversold trending move is higher than it would otherwise be. 1st sign of trouble will be a break back above the line at 38.85, just below 72 SMA resistance at 38.87. Link

Jeff Bailey : 10/25/2005 2:14:18 PM

02:00 Internals found at this Link

Linda Piazza : 10/25/2005 2:12:12 PM

The OEX has been testing Keltner support at 549.51 on 15-minute closes over the last three 15-minute candles. It so far has not closed a 15-minute period below that support. If it does, it looks vulnerable to 547.57 on 15-minute closes, with the 30-minute chart presenting the possibility of a deeper drop, to 545.17, on a 30-minute close beneath 549.73-549.98. The OEX is at 550.14 as I type, attempting a bounce. More right-shoulder choppiness. Next resistance at 551.09 on 30-minute closes, near the appropriate right-shoulder level.

Jeff Bailey : 10/25/2005 2:09:30 PM

"Sell Program Premium" based on yesterday's levels. DIA $103.23, SPX 1,189.96, QQQQ $38.80

Linda Piazza : 10/25/2005 2:07:28 PM

The RUT is headed down toward a test of its converging 200-sma and -ema's again, with those at 634.26 and 634.91, respectively. The RUT is at 637.47. The RUT's small caps have no direct correlation to the OEX's big caps, of course, but the RUT often serves as a market indicator.

Jonathan Levinson : 10/25/2005 2:05:45 PM

Stepping away for 10 minutes here.

Linda Piazza : 10/25/2005 2:04:40 PM

I hope some of you did get into OEX bearish plays today on the rollover beneath the levels I listed this morning. I sure wish I hadn't been interrupted and could be participating in this in an official way, but that just didn't happen. If you read my Traders Corner article this last weekend on trading diaries, you know that times of family-related emergencies would not be a good time to be making decisions about personal trades, much less those posted on the MM. Be assured that I would have posted such a trade and it would have been profitable because I would have had readers take partial profits already and then lower stops each step of the way, by now to breakeven. You should be doing that on your own, too, because there's no assurance that this current H&S will confirm. The advdec line still looks vulnerable to lower values, but we're overdue for an advdec test of resistance, too, and charts up to the 15-minute still show bullish divergences.

Jeff Bailey : 10/25/2005 2:04:00 PM

02:00 Market Watch found at this Link

Jonathan Levinson : 10/25/2005 1:59:33 PM

Volume breadth is down to -2.34:1 on the NYSE, -2.09:1 on the Nasdaq.

Linda Piazza : 10/25/2005 1:59:49 PM

It took the OEX a little more than three hours yesterday, from about noon until 3:20, to form the left shoulder on the new and larger potential H&S visible on its 10-minute chart. I certainly hope that we don't have three hours of the OEX rattling around between 549.50 and 551.30 or so before we even knew whether this one is confirmed or invalidated. We could, though. Advdec line needs to drop sharply toward next support at about -2800 to avoid that long period of choppy trading. Advdec line at -2097 as I type.

Linda Piazza : 10/25/2005 1:54:06 PM

RLX bouncing back above the 60-minute 100-ema, testing the 130-ema. Needs to be watched, with those averages at 433.18 and 433.71, respectively. The RLX is at 433.47 as I type, with the 60-minute period still far from concluded.

Linda Piazza : 10/25/2005 1:47:08 PM

The OEX has attempted to steady at the level I identified in my 1:36:18 as the neckline for a new potential H&S, a larger one. As I mentioned in that post, the OEX could now rattle around, forming a right shoulder, with the appropriate right-shoulder level perhaps up to about 551.15 or maybe a little higher. OEX at 550.02 as I type. Bears would rather not have the advdec line climb above -1650 or -1540 or so while that right shoulder forms, if it does. Advdec line now at -2052, QCharts value.

Jonathan Levinson : 10/25/2005 1:46:51 PM

QQQQ holds rising support for its first test, but so far the bounce is heavy. Adding an upper resistance line forms a bear wedge with an implied target as low as Wednesday's low in teh 37.60 area on a full downside break: Link

Linda Piazza : 10/25/2005 1:43:42 PM

Advdec line still dropping. Next support near -2780, I believe, with the advdec line now at -2055.

Linda Piazza : 10/25/2005 1:41:57 PM

OEX testing potential support, down to 549.50 or so. OEX at 549.85 as I type. The ascending trendline off last week's low is now at about 548, and should also be watched for potential support.

Linda Piazza : 10/25/2005 1:39:57 PM

The RLX dipped below the 60-minute 100/130-ema's, the first time it's done so since zooming above them on 10/19. These average are important in the RLX's behavior. There has not been a 60-minute close beneath these averages, now at 433.16 and 433.70, respectively, with the RLX currently at 432.57, but unless there's a quick bounce back above those averages, the RLX is looking weaker on this basis.

Linda Piazza : 10/25/2005 1:36:17 PM

OEX H&S confirmed. Bears still don't want to see a quick reversal back above that neckline, though, with the OEX dropping back to test the 10-minute 100/130-ema's, at 550.12 and 549.72, respectively.

Another H&S possibility presents itself now. The OEX could steady near 549.50-550.00 and then rise into a right shoulder for a bigger H&S, with this morning's now forming the head of the larger one. The right shoulder level would be at about 551.15 or so, and the OEX could spend a couple of hours chopping around to form that right shoulder. If the advdec line drops immediately toward -2800, as looks at least possible, then that might not happen.

Jonathan Levinson : 10/25/2005 1:35:48 PM

QQQQ tests rising support from last Wednesday: Link

Jeff Bailey : 10/25/2005 1:33:56 PM

SOX.X 441.01 -1.29% ... session low.

Linda Piazza : 10/25/2005 1:32:03 PM

The OEX often sprinkles in a doji between some of its alternating bullish and bearish days when it's consolidating. Right now, the bears are liking what they're seeing, but remember the doji possibility, too, and keep lowering your stops.

OEX minimal confirmation of the H&S during one typical stop-running time of day. Bears don't want a quick reversal higher. OEX at 550.74 as I type.

Jeff Bailey : 10/25/2005 1:31:52 PM

Bearish day trade short alert for Xilinx (XLNX) $23.44 -0.59% here, stop $23.61, target $23.14 toward the close.

Jonathan Levinson : 10/25/2005 1:30:47 PM

Session high for crude oil, +1.65 at 61.975.

Linda Piazza : 10/25/2005 1:28:22 PM

If the OEX trades sideways much longer, then it's going to invalidate the whole H&S thing just because the formation dissolves. We're coming up on the typical stop-running time of day, so that would be a good time for bulls or bears to try to run the OEX up and either invalidate or confirm that H&S. I'm never good at guessing which direction the markets will get pushed in this typical stop-running time of day.

Jonathan Levinson : 10/25/2005 1:27:40 PM

QQQQ's 30 min cycle downphase is roughly 2/3 done, while the 60 min cycle downphase is just getting going, maybe 20% into its run. That makes this prime time for bears. The first goal is a break of rising support in the low 38.80s, but ears will need a break of 38.44-.50 to threaten the so-far strong daily cycle upphase.

Jeff Bailey : 10/25/2005 1:24:54 PM

Current OPEN MM Profiles found at this Link

Jonathan Levinson : 10/25/2005 1:22:11 PM

No improvement for volume breadth, whcih continues to bleed slowly lower, currently down to -1.86:1 on the NYSE and -1.76:1 on the Nasdaq.

Jeff Bailey : 10/25/2005 1:13:13 PM

01:00 Internals found at this Link

Jonathan Levinson : 10/25/2005 1:12:22 PM

Ten year note yields rise to a 3.6 bp gain at 4.482%, the IRX holding steady with its big 7 bp gain at 3.835%, the yield curve steepening as the TNX rises.

Linda Piazza : 10/25/2005 1:11:03 PM

OEX dropping into a neckline test for its H&S on the 15-minute chart. Outcome is yet uncertain as it's not yet dropping strongly beneath that neckline and so the confirmation is still in question. OEX at 550.94. The neckline is at about 550.85 or so, if I've drawn it correctly.

Jonathan Levinson : 10/25/2005 1:06:16 PM

QQQQ's 30 min cycle has declined to line up with rising support connecting the lows from last Wednesday, currently at 38.81-.83: Link

Linda Piazza : 10/25/2005 1:03:11 PM

OEX dropping toward a test of its H&S on its 10-minute chart. Needs to drop below about 550.80 and stay below it to confirm that H&S.

Jeff Bailey : 10/25/2005 1:02:21 PM

01:00 Market Watch found at this Link

Linda Piazza : 10/25/2005 1:02:05 PM

Advdec line is so far hugging the bottom of the same channel that it hugged yesterday, except that yesterday it was hugging the top of that channel. Potential bullish divergences are beginning to show up as the advdec line continues dropping, but they may mean no more than the bearish divergences did yesterday, at least for the time being. They will eventually mean something. There's the possibility of a bounce at any time, and if so, bears would like to see the advdec line stay beneath about -1250 or below -580, if the first resistance doesn't hold. If the advdec line can't mount a bounce from the current support being tested, then it's vulnerable to about -2750.

Linda Piazza : 10/25/2005 12:57:23 PM

That right shoulder for the OEX's potential H&S is now a potential H&S of its own. This is not an unusual occurrence. Bears would like to see the OEX stay beneath 552-552.20 now.

Jonathan Levinson : 10/25/2005 12:47:44 PM

Volume breadth is -1.62:1 on the NYSE, -1.69:1 on the Nasdaq. QQQQ's drop is stalling the short cycle indicators here, and it feels bearish to me- but if the bottom doesn't drop out here, the ensuing bounce will have a bullish short cycle divergence from which to launch: Link

Linda Piazza : 10/25/2005 12:44:21 PM

Careful, OEX bears. The RLX is still testing those important 60-minute 100/130-ema's at 433.18 and 433.74, respectively. It hasn't dropped below them, much less closed a 60-minute period below them, so might still bounce from them. RLX at 433.88 as I type.

Linda Piazza : 10/25/2005 12:42:48 PM

Neckline test coming up for the OEX. Bears, be cautious here as there are sometimes invalidations of the H&S's that begin with a neckline test or even a small violation, followed by a quick reversal. Hopefully, you've already taken partial profit, but if not, this is another place to consider doing so. Consider lowering the stop on the rest of your position an account-appropriate level above the right shoulder, at 552.70, or perhaps use the left-shoulder level at 553.16.

Linda Piazza : 10/25/2005 12:40:13 PM

The OEX is dropping to test those three-minute 100/130-ema's I mentioned earlier, with those at 551.71 and 551.37, respectively. The OEX needs to continue below these, and not bounce from them as it's been doing previously today, but I wouldn't preclude another test up to the three-minute 100-ema. The next step in the bears' favor would be a confirmation of the H&S with a drop below 550.89.

Jonathan Levinson : 10/25/2005 12:36:11 PM

Dec. gold has arrested what was shaping up to be a strong daily cycle downphase, but there's still a danger at 476, which could be upper right shoulder resistance for a ead and sholders top above a 462 neckline. A break and close above that level could be enough to generate the first buy signals in the daily cycle, and so it looks like key resistance both pattern- and cycle-wise: Link

Linda Piazza : 10/25/2005 12:32:26 PM

The next thing that needs to happen to cheer OEX bears is the OEX needs to close beneath the three-minute 100/130-ema's at 551.71 and 551.37, respectively. Then it needs to violate the neckline of its H&S, with that neckline at about 550.89 currently. OEX at 551.86 as I type, testing those three-minute MA's, with another bounce from them not yet ruled out.

Jonathan Levinson : 10/25/2005 12:31:25 PM

QQQQ's short cycle bounce is doing nothing here, holding above the 38.96 pivot. If it holds to overbought, I will be looking for a short to ride the ensuing downphase. Link

Jonathan Levinson : 10/25/2005 12:26:15 PM

Session low for ten year notes, -9/64 at 109 1/32, with TNX up 1.2 bps at 4.458%.

Jonathan Levinson : 10/25/2005 12:25:04 PM

Session high for crude oil, +1.225 at 61.55, and natgas, +.825 at 14.00.

Jonathan Levinson : 10/25/2005 12:22:56 PM

Session high for gold, +8.80 at 475.70, silver +1.87% at 7.85.

Linda Piazza : 10/25/2005 12:19:24 PM

Nice looking potential H&S on the OEX's 10-minute chart now, but the OEX needs to soon round down toward the neckline or bulls will gain more confidence and try to invalidate the formation.

Jonathan Levinson : 10/25/2005 12:18:00 PM

Ten year note yields hold a .8 bp gain here at 4.454%, IRX +7.2 bps at 3.837%

Linda Piazza : 10/25/2005 12:16:20 PM

Bears would like to see the advdec line's bounce stopped at about -950, although stronger resistance is up at -250. Advdec line at -1252 as I type, QCharts value.

Linda Piazza : 10/25/2005 12:15:04 PM

The RLX is trying to bounce back above its 60-minute 100/130-ema's after dipping all the way to the 100-ema at 433.17. RLX at 434.00 as I type.

Linda Piazza : 10/25/2005 12:14:20 PM

And there goes the "bit higher of a bounce" just as I was uploading that 12:13:52 post.

Linda Piazza : 10/25/2005 12:13:52 PM

The OEX is still possibly building that H&S on the 10-minute chart. Remember that not all such H&S's are confirmed or reach their targets if they are. I think there's at least a decent chance this one will confirm, but I'm not sure the right-shoulder building is finished yet. Still could be a bit higher of a bounce.

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

So far, the opposition of the short cycle and the 30 min cycle is resulting in sideways chop just above the lows of the day. Meanwhile, the 60 min channel has ticked down, support down to 38.88 for that cycle. Link

Jeff Bailey : 10/25/2005 12:10:59 PM

12:00 Internals found at this Link

Linda Piazza : 10/25/2005 12:06:40 PM

The OEX is attempting to front-run an advdec line bounce. So far, the OEX continues to find resistance on 10-minute closes beneath the 10-minute 21-ema at 551.95, but I wouldn't be surprised to see a punch a little above that MA, to fit with a possible H&S building on that 10-minute chart. I think it's possible that the OEX will likely drop back to retest the 10-minute 100/130-ema's, now at 459.76 and 549.48, respectively, but that also depends on the RLX, currently testing the 60-minute 100/130-ema's that have bounced it on multiple tests since 10/20.

Jeff Bailey : 10/25/2005 12:03:12 PM

12:00 Market Watch found at this Link

Tab Gilles : 10/25/2005 12:00:00 PM

Citrix Systems (CTXS) Hitting longterm resistance. Link Link

Linda Piazza : 10/25/2005 11:59:01 AM

The RLX's decline today has been one factor pushing the OEX lower, too. The RLX over the last week has been frequently dropping down to test the 60-minute 100/130-ema's, so far spring up from those tests. The RLX is approaching another test of those averages, at 433.17 and 433.99, respectively, with the RLX at 433.82. OEX bears want to see the RLX drop through those averages. I wouldn't be surprised to see at least a bounce attempt, if not an actual bounce, but if it falls straight through those averages, that's not saying good things about the OEX's ability to bounce.

Jonathan Levinson : 10/25/2005 11:54:35 AM

Volume breadth has sunk to -1.48:1 on the NYSE, -1.45:1 on the Nasdaq, nothing like the huge positive readings we saw yesterday. QQQQ's short cycle downphase is bottomy here and trying to turn up, and this is where the young rollover in the longer intraday cycles is going to bump up against the young upturn in the short cycle. Link

Linda Piazza : 10/25/2005 11:53:52 AM

Advdec line still trying to steady above the -1490-ish support, advdec line at -1306 as I type, QCharts value.

Linda Piazza : 10/25/2005 11:52:53 AM

OEX so far finding resistance at the 10-minute 21-ema, the average that had supported it on yesterday's bounces. That average is now at 552.00, with ten-minute closes below it important. Just judging where the right shoulder should be on the potential H&S, I wouldn't be surprised to see a punch above that average, but so far, it's not happening, and bears are happy to see it not happen.

Jeff Bailey : 10/25/2005 11:51:40 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 10/25/2005 11:43:49 AM

Time for the advdec line to attempt a bounce again, possibly. Bears want the -620-ish level to hold as resistance if there's a bounce. Advdec line at -1193 as I type.

Linda Piazza : 10/25/2005 11:42:38 AM

Sure wish I'd been able to post an official bearish trade signal this morning, as I would have if I'd been able, to redeem some of yesterday's losses. However, I would have had partial profits already taken, as I've advised already in my posts, and I'd be warning that conservative traders who didn't want to risk a right-shoulder bounce should exit all the position. Others should just lower stops, perhaps to an account appropriate level above the 553.16-ish level appropriate for a right shoulder.

Tab Gilles : 10/25/2005 11:39:47 AM

Murphy Oil (MUR) followup to 12:41 AM chart. Link

Linda Piazza : 10/25/2005 11:39:30 AM

No right shoulder for the OEX unless it's going to be a descending neckline H&S on that 10-minute chart. The drop without a right shoulder attempt isn't a bullish event, of course.

Jeff Bailey : 10/25/2005 11:39:21 AM

SPX 1,194.29 -0.42% ... sits right on WEEKLY R1.

SOX.X 443.33 -0.77% ... trades just on that 442.94 retracement.

Important intra-day support levels being tested here.

Linda Piazza : 10/25/2005 11:38:04 AM

Wouldn't you be scared right now if you were a bull and looking at those alternating red and white candles on the OEX lately, those increasing larger alternating white and red candles? I would be, but that doesn't mean that OEX bears shouldn't be watchful as the advdec line dips toward the support it tested this morning.

Linda Piazza : 10/25/2005 11:36:19 AM

Advdec line at -1248, QCharts value, headed into -1500 support. There's a possibility that the advdec line may just hug that support the rest of the day, but watch for a potential bounce from this test. If so, timing would be right for a right-shoulder building move on the OEX. Hasn't happened yet. The possibility of the OEX chopping lower through the day remains, but I'd be very careful with my stops if in bearish positions. Right now, both bulls and bears have seen indices swing wildly their directions over recent days and there's much opportunity for the trading to get away from either side.

Jonathan Levinson : 10/25/2005 11:34:29 AM

The 18B 4-week treasury auction sold at a high-rate of 3.635% yielding 3.696%, with 2.12 bids tendered for each accepted. Foreign central banks purchased 1.69B of the 18B total. Currently, 13-week bill rates are up 7 bps at 3.835%, while ten year note yields have risen to a 1.2 bp gain at 4.458%.

Jonathan Levinson : 10/25/2005 11:32:01 AM

Volume breadth -1.39:1 on both the NYSE and the Nasdaq.

Linda Piazza : 10/25/2005 11:31:05 AM

VIX still headed up.

Linda Piazza : 10/25/2005 11:29:51 AM

The RLX has erased most of yesterday's gains. It's got strong support from 432.20-432.75, however, with the RLX now at 434.83. As long as the RLX and BIX both drop today, it's going to be difficult for the OEX to make many gains.

Linda Piazza : 10/25/2005 11:27:19 AM

Another possible scenario for today is a possible OEX steadying near 551.70, and then a rise up toward 553-553.50, to form a H&S on top of its 10-minute chart. Bears should be aware that if the OEX does steady near 551.70, they might be looking at a bounce into a right-shoulder.

Linda Piazza : 10/25/2005 11:26:08 AM

OEX dropping beneath that 10-minute 21-ema. It's still within testing range. Bulls want to see a quick bounce back above that level. Bears don't. The average is at 552.12, important on 10-minute closes. The OEX is at 552.06 as I type.

Jonathan Levinson : 10/25/2005 11:25:55 AM

If 38.90-.96 support fails, the rising trendline off the lows will be in play at 38.80 QQQQ, below which the 30 and 60 min channels would get in gear to the downside: Link

Linda Piazza : 10/25/2005 11:24:20 AM

I think now that there's a chance, perhaps not yet a probability, that we'll see a day in which the advdec line drops with the supporting line now at -1440, just as yesterday it was hugging and climbing with the resistance line that formed the top of the same channel that has the bottom support near -1440. I've thought that was a possibility all day, but wanted to see the retest of the support level broken through this morning before I issued a play signal. Unfortunately, I was called away and couldn't issue any kind of signal, but I mentioned what should be watched, and I hope some did enter a bearish play. Right now is the time to be extremely careful, though, as that 10-minute 21-ema is being retested. Take that partial profit, if you haven't already and lower your stops an account-appropriate level, perhaps to your entry or perhaps just above the day's high, according to your own trading style. There's that possibility of the advdec line and OEX both chopping lower today, but certainly no confirmation of that, so that it's not yet a probable scenario, but only a possible one. A bounce from this 10-minute 21-ema is another possible scenario.

Jonathan Levinson : 10/25/2005 11:19:58 AM

The Fed's coupon pass is for 1B, deliverable tomorrow.

Linda Piazza : 10/25/2005 11:19:12 AM

The OEX has bounced from just a few cents above it 10-minute 21-ema. If you took at least partial profit, you can watch this bounce with some equanimity. Advdec line still headed down, so if you didn't take partial profits, you may get a second chance.

Jonathan Levinson : 10/25/2005 11:18:14 AM

QQQQ's break here has stalled the 30 min channel upphase, not yet the 60, and turned down the short cycle in the process. Lower channel support is just below that 38.96 confluence top, and so while this looks like the start of a meaningful breakdown, there's still significant support close below. Link

Jeff Bailey : 10/25/2005 11:12:16 AM

11:00 Internals found at this Link

Linda Piazza : 10/25/2005 11:11:09 AM

The advdec line's resistance still holds, so far, but there's a chance it may come up and retest it again. Advdec line now at -339, QCharts value, resistance strong up to about +160. The OEX isn't retreating far, although it's now below the 10/19 high and the daily 21-ema. I said earlier this morning to watch for a potential rollover beneath that 10/19 high and/or the 21-ema, and that's tentatively happening, but I wasn't able to call a play or watch carefully enough to see if everything was setting up as expected. If any are in bearish plays, be very careful as the OEX dips toward the 10-minute 21-ema at 552.18. I'd consider taking at least partial profits at that level unless the OEX just crashes through it.

Jeff Bailey : 10/25/2005 11:03:30 AM

11:00 Market Watch found at this Link ... U.S. Dollar Index (dx00y) trading WEEKLY S2 here. Will be on the al_rt for any further weakness to MONTHLY Pivot.

Jeff Bailey : 10/25/2005 10:59:40 AM

eBay (EBAY) $37.80 -4.16% ... defensive on move back below it trending lower 200-day SMA.

Linda Piazza : 10/25/2005 10:58:10 AM

Today the BIX has been struggling with the 38.2% retracement of the decline off the 7/15 high into the 10/12 low. It reached right to that level yesterday at the close, stopping conveniently on that Fib level at 344.10 and today is just below it, at 343.31, but above the 50-sma at 343.12. Mixed evidence, but will this be a doji day?

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

QQQQ's short cycle upphase hasn't done much better than the preceding downphase, and those 30/60 min cycles are still up in nosebleed territory. Although the upper channels line up just below 39.30, a break of 72 SMA support at 39.08 here could stall them: Link

Jonathan Levinson : 10/25/2005 10:56:09 AM

Session high for crude oil and natgas here at 61.425 and 13.81, +1.78% and +4.78% respectively.

Linda Piazza : 10/25/2005 10:53:06 AM

The OEX is still finding resistance on 30-minute closes at a Keltner line currently at 554.11. It may be down to the wire, but the OEX looks as if that Keltner resistance may hold into this 30-minute close. Next support at 551.78 on this chart. It's at 552.11 on 10-minute closes on the 10-minute chart.

Jeff Bailey : 10/25/2005 10:54:31 AM

Semiconductor Index (SOX.X) 444.42 -0.5% ... Daily interval bar chart with WEEKLY (blue) and MONTHLY (red) pivot matrix retracement at this Link ... Overlap support/resistance at 438/451 defines the range.

Throw in a little software and biotech and QQQQ $39.00 = SOX 442.94 and QQQQ $39.58 = SOX 451.

Linda Piazza : 10/25/2005 10:49:25 AM

The advdec line's resistance is tentatively holding. Perhaps because I'm not able to attend to every little movement up and down as I usually do each day, I don't have a strong sense of whether it will continue to hold, but I wouldn't be surprised to see it travel down to -1400 again, with the advdec line now at -215. The advdec line is at the classic place from which it might be turned back, but the evidence is just not clear right now, at least to me.

Jonathan Levinson : 10/25/2005 10:48:00 AM

Stepping away.

Jonathan Levinson : 10/25/2005 10:42:44 AM

Volume breadth +1.11:1 on the NYSE, -1.17:1 on the Nasdaq here.

Jonathan Levinson : 10/25/2005 10:41:25 AM

Headline:

[IBM] IBM TO BUY BACK UP TO ADDITIONAL $4B OF STOCK

IBM currently trades -.12 at 83.35, off a low of 82.71.

Jonathan Levinson : 10/25/2005 10:37:36 AM

The Fed announces a coupon pass, no quantum yet- this is equivalent to a permanent repo, which increases liquidity on a permanent rather than temporary basis. The funds will be deliverable tomorrow, and the amount should be known just after 11AM.

Linda Piazza : 10/25/2005 10:36:10 AM

I'm back for a few minutes, but may be in and out, so I'm not going to issue any play signals until I'm sure I'm going to be here steadily. Right now, the OEX has risen to retest the 10/19 high, having moved a little above it, and to test the daily 21-ema, having risen a little above that, too, but then sinking a little below it. The advdec line, meanwhile, has risen to test what could be strong resistance, but hasn't really turned down yet from that resistance. It looks to me as if that resistance, layering above the advdec line's current -17 might be strong enough to turn it lower again, but that's an untested theory right now because it hasn't yet been turned back. On any pullbacks, watch the 10-minute 21-ema for potential support, with that at 551.75 currently. That means that if you're currently in a bearish play, you'll want to be careful and consider taking at least partial profits as that is tested. If you want a bullish entry, you'll watch to see how the OEX behaves on retests of that MA.

Jonathan Levinson : 10/25/2005 10:34:47 AM

30/60 min channel resistance are up to 39.21-39.28 QQQQ: Link

Jonathan Levinson : 10/25/2005 10:27:24 AM

Volume breadth is up to +1.19:1 on the NYSE, -1.06:1 on the Nasdaq. The 30/60 min cycle bears were unwilling to pick up the ball. QQQQ's short cycle downphase has stalled.

Jonathan Levinson : 10/25/2005 10:20:32 AM

QQQQ's short cycle downphase is very far from causing a panic on the part of bulls, still getting very poor traction, particularly from such an extreme overbought move. Until those 30/60 min channels break down, the bears will be fighting an upward tide. 72 SMA is up to 39.03, but 38.96 confluence looks like the more important test to me. Link

Jeff Bailey : 10/25/2005 10:25:26 AM

Coventry Health Care (CVH) $54.50 -9.25% Link ... managed care company lower after reporting Q3 net income of $133.1 million, or $0.81 a share, which was up from $87 million, or $0.64 a share in the year ago period. The results were inline with consensus and reflected the company's 3-2 stock split distributed on 10/17/05.

The company forecasted 2006 earnings of $3.54-$3.59 a share, which excluded any impact from Medicare drug benefit and changes in accounting rules for the reporting of stock options. Analysts were expecting $3.64 per share excluding special items.

Jeff Bailey : 10/25/2005 10:20:13 AM

AMR Corp. (AMR) $13.38 +4.85% Link ... JP Morgan upgraded to "neutral" from "underweight."

Continental Airlines (CAL) $12.44 +4.97% Link ... JP Morgan upgraded to "neutral" from "underweight."

The broker said it expects the two companies to return to profitability in 2006, as revenue per available set mile rises and excess capacity is pared.

Jeff Bailey : 10/25/2005 10:12:48 AM

10:00 Internals found at this Link

Yesterday's Internals found at this Link

Jonathan Levinson : 10/25/2005 10:12:06 AM

Volume breadth -1.22:1 on the NYSE, -1.67:1 on the Nasdaq.

Jonathan Levinson : 10/25/2005 10:08:25 AM

Ten year notes firm, TNX down 1 bp at 4.436%, while the 13 week t-bill rate holds its big gain, up 7 bp at 3.835% and flattening the yield curve.

Jonathan Levinson : 10/25/2005 10:06:03 AM

The 10AM gyrations saw spike up in QQQQ to a lower high, confirming the short cycle downphase in progress. But the 30 min cycle upphase hasn't yet broken down, and the short cycle downphase delivered most of its force before the bell- it could still be corrective, although the price feels heavy here as I type. Link

Jonathan Levinson : 10/25/2005 10:04:47 AM

Session high for gold and silver here, crude oil reopening +.725 at 61.05 and natgas +.43 at 13.605.

Linda Piazza : 10/25/2005 10:04:18 AM

Sorry. Family emergency has called me away. Watch for the possibility that the OEX will roll over beneath about 553-554. I'll be back as soon as I can.

Linda Piazza : 10/25/2005 10:02:25 AM

OEX just coiling. So far.

Jeff Bailey : 10/25/2005 10:02:01 AM

10:00 Market Watch found at this Link

Jonathan Levinson : 10/25/2005 10:01:29 AM

Headlines:

WEAK CONFIDENCE MAY IMPACT HOLIDAY SALES - CONFERENCE BOARD

U.S. SEPT. EXISTING HOME INVENTORIES UP 0.3%

U.S. SEPT. EXISTING HOME SALES FLAT AT 7.28 MILLLION PACE

Linda Piazza : 10/25/2005 10:01:14 AM

RUT pulling back a little, back to 648.30-648.40 support and attempting to bounce from that. It's below the day's open and high currently.

Jonathan Levinson : 10/25/2005 10:00:47 AM

Headlines:

U.S. OCT. CONSUMER CONFIDENCE FALLS TO 85.0 VS REV 87.5 SEPT

U.S. OCT. CONFIDENCE DROP UNEXPECTED BY ECONOMISTS

Jonathan Levinson : 10/25/2005 9:59:21 AM

Awaiting Existing Home Sales, est. 7.2M and Consumer Confidence, est. 88.

Linda Piazza : 10/25/2005 9:58:00 AM

If the advdec line zooms through -250 to -50, next strong resistance appears to be near +1000-1200. Advdec line at -694 as I type, QCharts value.

Linda Piazza : 10/25/2005 9:56:26 AM

OEX setting up the potential to retest the 10/19 high of 553.83 or even the daily 21-ema at 553.90. OEX at 552.76 as I type, not yet even falling back to the 10-minute 21-ema to test that support, now at 551.07. I wouldn't trust anything right now.

Jonathan Levinson : 10/25/2005 9:54:38 AM

Volume breadth is just below neutral at -1.07:1 on the NYSE, -1.38:1 on the Nasdaq.

Linda Piazza : 10/25/2005 9:54:08 AM

This expected first reversal of the day was the reason that I resisted calling a bearish play this morning, even though the advdec line headed down. It was heading down from such a level that a bounce was suggested and I wanted to see how it handled -250 to -50 potential resistance. If it zooms through that, then any bearish play could have been short-lived indeed. Advdec line at -938 as I type.

Jonathan Levinson : 10/25/2005 9:52:43 AM

A 1.75B overnight repo drains 4.25B against the 6B expiring. The stop out rate held at 3.69, showing demand for the Fed's money unchanged from yesterday.

Jonathan Levinson : 10/25/2005 9:50:27 AM

Dec. gold is up 7.2 here in a big move to 474.20, 30 cents off its session high. Silver is up .144 at 7.85. Oil and natgas are still closed, with natgas having gone out at its overnight session high of 13.60, a 3.23% gain.

Linda Piazza : 10/25/2005 9:49:57 AM

OEX Keltner picture: The OEX has resistance at 552.39-552.75 on 15-minute closes and first support at 551.39 on 15-minute closes. Stronger resistance lies at 553.69 on 30-minute resistance. The OEX came close enough to a double-top yesterday that bears might be willing to defend yesterday's high, up to the 10/19 high of 553.83, but bulls are going to want to defend their positions, too. Dangerous level here for both bulls and bears. The advdec line is trying to bounce up to retest broken support, but hasn't made it far yet, but I see too much mixed evidence to give a call here, ahead of the economic numbers.

Linda Piazza : 10/25/2005 9:46:09 AM

Yesterday the OEX was bouncing off its 10-minute 21-ema. It's headed down toward that average, now at 550.89 and still rising. The OEX is at 551.62 as I type. This test of the known support from yesterday may occur near the release of the economic numbers.

Linda Piazza : 10/25/2005 9:44:25 AM

Small advdec line attempt to bounce. Not much yet.

Jonathan Levinson : 10/25/2005 9:42:30 AM

Session high for QQQQ at 39.11, Nasdaq vol. breadth still negative at -1.63:1. Short cycle resistance is at 39.13, 30 min channel resistance at 39.19: Link

Linda Piazza : 10/25/2005 9:42:02 AM

The advdec line still drops, and it looks ugly on the 60-minute chart. Let's watch this first reversal of the day, though, with extra caution with the economic numbers coming up.

Linda Piazza : 10/25/2005 9:40:04 AM

Advdec line attempting to hold to that support I mentioned, which might lead to a bounce back to test what should have been support, to see if it's now resistance. This is why I hesitated to issue a bearish trade this morning ahead of the first reversal of the day. We are seeing the pullback that I suggested yesterday afternoon that we'd see this morning, but . . . well, there are just lots of buts with the advdec line testing deep support and the RSI showing the move already overdone to the downside, although the way through the 30-minute chart. I think it's possible that we could get something like the reverse of yesterday, with an early overdone signal to the upside just becoming more and more overdone all day, but unless you were in a bearish position already at the close yesterday, you wouldn't have any cushion against the first reversal of the day, due in a few minutes. Let's watch that to see if it gives any clues.

Jonathan Levinson : 10/25/2005 9:38:40 AM

The Fed has yesterday's 6B overnight repo expiring today, the announcement due in 20 minutes ahead of the Consumer Confidence and Home Sales data.

Jeff Bailey : 10/25/2005 9:38:35 AM

Bearish swing trade stop alert ... for Dynamic Materials (BOOM) $20.32 +0.65%

Linda Piazza : 10/25/2005 9:33:18 AM

It's looking to me as if the advdec line could decline to -2540, but the downside move is already looking overdone according to RSI, which keeps me on the sidelines right now.

Jeff Bailey : 10/25/2005 9:31:35 AM

Program Trading Levels for Tuesday ... HL Camp & Company's offices are closed due to hurricane Wilma.

Monday's buy program premium level was $4.49 and sell program premium level was $1.99.

Jonathan Levinson : 10/25/2005 9:31:30 AM

Volume breadth is -1.54:1 on the NYSE, -1.59:1 on the Nasdaq at the open.

Linda Piazza : 10/25/2005 9:31:23 AM

Advdec line still headed down, already into possible first support, so let's see if it bounces now to retest that mid-channel level. It's at -841, QCharts value, as I type.

Linda Piazza : 10/25/2005 9:30:29 AM

Advdec line opens below S/R. Unless it heads up quickly, this is not good for early bullish plays.

Jonathan Levinson : 10/25/2005 9:11:41 AM

The overnight drop has turned the trending 30 min cycle indicators down, but there's no way to tell whether it's going to actually stick- this same setup occurred several times yesterday as well. The 60 min cycle continues to point higher, but it and the 30 min are still somehow on bearish divergent highs. Pricewise, it looks bullish to me above that 38.96 area that capped the action yesterday up to the breakout. 72 SMA support is conveniently located at 38.95, below which the rollover in the 30 min cycle indicators will get confirmation. Link

Jonathan Levinson : 10/25/2005 9:02:25 AM

WESTON, Fla. (AP) -- Beginning an agonizing, all-too-familiar process, Floridians lined up for generators, chain saws and other clean-up supplies only hours after Hurricane Wilma cut a costly, deadly swath across the peninsula.

The storm slammed across the state in about seven hours Monday, causing billions in insured damage and leaving 6 million people without electricity. Wilma was blamed for at least six and possibly as many as eight deaths statewide.

Link

Linda Piazza : 10/25/2005 8:59:42 AM

Thanks, Marc, for the advice just to type the word "Al-rt," setting off the bell. That's a good idea.

Linda Piazza : 10/25/2005 8:52:18 AM

Yesterday morning, my prediction was that the OEX was due for a bounce, and I should have stayed with that prediction. However, the OEX zoomed higher within the first few minutes. The advdec line zoomed with it, signaling that it was approaching resistance, resistance that mostly held into the close of the day. Bearish divergence--usually more reliable on the advdec line than on the equities, I've found--set up and the advdec line dropped beneath first support. I had already set up a bearish entry by that time, and the first profit target was reached. The mistake was in not exiting before the announcement of the new appointee for the Fed chairman. I had actually tried to post an exit when the OEX dipped below 547 just before the announcement of the identity of the new chairman, but the OEX had already begun bouncing before I could get it uploaded. I said when I first began posting trades that it was nerve wracking to do and that I would make some mistakes. This failure to get the post uploaded quickly enough was one, but one dictated by how fast I could access the exit banner, type in the necessary words and then get it uploaded. I'm new to this and I wasn't fast enough. The position resulted in a loss except for those who elected to take all profits despite the first profit target being hit.

Still, the advdec line may have been signaling a day early, as it did on 10/14 and 10/19. The next days following both those days found the advdec line climbing a little in early trading and then dropping. On the day following 10/14, there was a late-day advdec line bounce before the decline resumed the next day, but the drop was pretty much all day on the next day. What did the OEX do on those days? On the 17th, the first trading day after the 14th, it chopped around sideways, dropping and then rising but not to the early HOD. On the 20th, it dropped all day.

I'm not suggesting that we'll necessarily see that kind of drop today. This post was prepared last night and edited this morning, and already last night, the setup showed that there could be an early morning pullback, perhaps after some early follow-through, perhaps up to the daily 21-ema at 554.34. This morning, that first follow-through doesn't look so likely.

As strong as yesterday's gain was, it did not break the OEX out of its current consolidation zone, and it was helped along by DD and TXN, and it's possible that both might be a drag today, at least on the open. That consolidation zone on the OEX is a widening zone. I've checked before and haven't found much information about those broadening formations at the bottom of a steep decline and whether they might be bottoming formations as well as topping ones. I've seen some indications that they can be, but little. Mostly they just indicate emotion-based trading. The OEX has not closed a day above its 21-ema since 9/20. It has not retraced even 38.2% of the decline off the 7/28 high or of the decline off the 9/09 high. It's been testing the bottom of the broadening formation it's been forming since May.

It's what happens after that early pullback, if it occurs, that tells us what to expect next. I see strong resistance ahead in the 554-555 zone, so I'm going to be watching today for confirmation of a pullback in progress. If I see that, I'll let you know and perhaps signal a bearish play, but I'm likely going to want to get out as the 10-minute 21-ema, currently at 550.72, is tested, as that was bouncing the OEX all day yesterday. If the advdec line is plunging through support, we may exit only part of the position. If it's holding support, we may switch sides. If I don't get good signals, I'm not calling anything. We've had two profitable trades and one losing one on the MM, and I want to improve that record, not worsen it. I'll be watching closely today.

Jonathan Levinson : 10/25/2005 8:44:02 AM

Crude oil's strengthened as well, now up 60 cents and 2.5 cents off the high, at 60.925.

Jonathan Levinson : 10/25/2005 8:41:41 AM

Ten year notes are recovering from their lows, TNX currently down to a .2 bp loss at 4.444%, but IRX is way up, +6.2 bps at 3.827%, a 1.65% jump this morning. Gold is up 5.4 at 472.40, a session high.

Jonathan Levinson : 10/25/2005 8:01:49 AM

Equities are down, ES trading 1198.75, NQ 1593, YM 10371 and QQQQ -.11 at 39.05. Gold and silver are up at 468.90 and 7.758 respectively, ten year notes are down 5/64 at 109 3/32, crude oil is down .125 at 60.20 and natgas is +.235 at 13.41.

We await the 10AM releases of Existing Home Sales, est. 7.2M, and Consumer Confidence, est. 88.

Linda Piazza : 10/25/2005 7:19:12 AM

Good morning. The Nikkei gained last night, but other Asian markets were mixed. European markets started out in the green this morning, but many have turned lower. Our futures are lower, too, as of this writing. As of 7:07 EST, gold was higher by $2.50 to $469.50, and crude, down $0.30 to $60.02. More details about Asian and European markets follows in succeeding paragraphs.

Last night, the Nikkei shot higher. It couldn't maintain all of its gains, but still closed higher by 174.44 points or 1.33%, at 13,280.62. The Bank of Japan released October's survey of major banks' lending tendencies, with corporate funds demand seeing a strong pickup since 2002's lows. Both large and small-to-medium-sized companies increased. The diffusion index rose to +11 from the former quarter's zero. Toyota saw gains last night, as did many other carmakers and other exporters. Toyota's truck-production subsidiary Hino Motors Ltd. raised its full-year earnings estimates and gains. Honda had an extra reason for gaining, as that company's orders for its Civic gasoline-electric hybrid that will be available on November 22 in Japan have been stronger than anticipated. Construction firms gained after UBS increased its target prices for many companies in that sector.

In company-specific news, Sumitomo Trust & Banking Co. and SBI Holdings Inc. announced that they would form a capital alliance and create an Internet-based bank. NTT DoCoMo announced that it had terminated an equity agreement with a Dutch telecom. NTT gained. Sumitomo Chemical Co. raised expectations for half-year earnings, and gained. The Tokyo Stock Exchange reported a sharp rise in first-half net profit due to an increase in revenue credited to higher trading volume.

Other Asian markets were mixed. The Taiwan Weighted gained 0.07%, but South Korea's Kospi dropped 0.28%. In South Korea, the central bank reported that the economy grew 1.8% in the third quarter, the fastest rate in almost two years. Exports and consumer spending helped drive the number higher. Singapore's Straits Times rose 0.16%, and Hong Kong's Hang Seng gained 0.16%. China's Shanghai Composite dropped 1.69%. Steelmakers declined. Some anticipate that higher materials costs will cut earnings and ramped-up production capacity might trim prices. China's development chief said in an article published last night that that China's goal is to maintain an economic growth rate of 7.5% from 2006-2010, down from 2001-2005's 8.8%, and with only 5.7% needed annually to double its GDP from its 2000 level.

Many European markets are negative. Many started out with gains, but slipped lower. Some news sources speculate that there could be a German banking failure, with at least one news source naming AHBR, with that institution one of Germany's biggest five mortgage lenders. Also in Germany, the much watched IFO survey was released with the 98.7 number much higher than anticipated in official channels but in line with whisper numbers. The current assessment and expectations components both gained. Industry components saw broad gains, too. Commentators concluded that this number spoke well of domestic demand as well as exports, unlike the strong September number, plumped up mainly by exports. Despite this number and a strong French INSEE number yesterday, Bloomberg speculates that the EU Commission will downgrade its assessments for the Eurozone economy, to 1.3% from April's 1.6% for 2005, and to 1.9% from April's 2.1% for 2006. This information apparently came from a draft of its report that Bloomberg obtained. A later release in Germany, of the October CPI from the state of Saxony, showed some softness in the headline number, flat month over month and down to 2.9% year over year from the previous 3.1%. Yesterday, some other German states' releases showed similar results, with the last German state and the nation expected to release results later today.

In company-specific news, BP declined after announcing that charges due to the hurricanes would partially offset gains from high oil and gas prices, with the company also announcing that its Thunder Horse platform will start production in the second half of 2006. Spain's Banco Santander Central Hispano, much in the news lately, declined after announcing an agreement to take a position in Sovereign Bancorp and announcing earnings for the first nine months. Ericsson won its race with France's Alcatel to buy most of British telecom equipment provider Marconi Corp.'s telecom equipment assets. All three companies rose in early trading.

As of 7:03 EST, the FTSE 100 had dropped 19.20 points or 0.37%, to 5,188.40. The CAC 40 had dropped 13.03 points or 0.29%, to 4,408.94. The DAX had fallen 9.50 points or 0.19%, to 4,892.29.

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