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Jeff Bailey : 11/4/2005 2:41:39 AM

Yellow Roadway (YELL) ... my bar chart with two conventional retracement at this Link ... Making some ties with QQQQ (see below 1:47:43), but also some of the recent economic data (strong in my opinion) as well as refinery activity and distillate inventories.

I do NOT like my current stop of $44.00 as it relates to the chart.

At the time of bullish profile on Wednesday, I wasn't overly "comfortable" with the thought that the PINK retracement was in play, but Thursday's action suggests market participants may well be trading it. If so, then those very same market particpants are likely trading $43.71 as support.

YELL is NOT a component of the QQQQ, but it has 4-letters in the stock symbol.

YELL Weekly Pivot Levels ... $40.26, $42.45, Piv = $43.59, $45.78, $46.92.

Monthly Pivot Levels $37.08, $41.24, Piv= $43.78, $47.94, $50.48.

Thursday's low for YELL was $46.98.

Tab Gilles : 11/4/2005 1:30:08 AM

$SOX/SMH Similar charts on both the $SOX & SMH. Link Link

Intel (INTC) Link

Tab Gilles : 11/4/2005 12:55:11 AM

Follow ups

Murphy Oil Back at the $49 level; [avg cost basis $48.30]. Setting stop at 10-ema. Link

$NASI/UOPIX/$VXN The weekly BUY signal on the $NASI is finally playing out as expected. As per 11/3 12:45PM post, 10/26; 1/2 position @ $22.66 & 1/2 position on 11/2 @ $23.26 with average cost basis @ $22.99, closing NAV 11/3 @ $23.97, up + 4.35%. Link Link Link

Citrix Systems (CTXS) Since my initial observation on Citrix back on 7/13 11:25 AM post & 7/27 4:44PM. It has had quite a run- From $22.42, currently $27.72, use 10-ema as a stop. Link

JP Morgan Chase (JPM) In reference to 10/28 1:42PM post. Link Link Link

Jeff Bailey : 11/4/2005 1:47:43 AM

QQQQ Option Chain at 11/03/05 Close / Open Interest for 11/02/Close with hand calculated CHANGES in Open interest that took place during Wednesday's POWERFUL upside move at this Link ...

Some analysis ... OVERHEAD SUPPLY IS LIMITED. Not just the QQQQ, but OPEN INTEREST above $39.00.

The last two days, I've posted the QQQQ option chain. Here's the option chain from the 11/02/05 Close Link

Now ... today (11/03/05) at 02:31:56 I went out on a rather thin limb with the thought that the QQQQ might pull back to $39.40-ish if my option calculations are/were correct.

The last two months, I've come pretty darned close to finding the monthly MAX PAIN levels for QQQQ expiration, but now a PROBLEM, or should I say LACK OF INFORMATION makes it much more difficult.

Do you know why?

If you said ... Because you don't have a ceiling of OPEN INTEREST to calculate against, or get a feel for what the market makers need to do to inflict MAX PAIN then you and I are on the same page.

In the scope of supply/demand, what does that tell you?

OVERHEAD SUPPLY IS LIMITED!

If I were to now give you a near-term resistance point, other than MONTHLY R1 of $40.06, where would it be?

Hmmm.... in the option chain from THURSDAY's action, what is the one contract OPEN INTEREST change that stands out? How about that Nov. $38 Call (QQQ-KL) where OPEN INTEREST FELL on Wednesday by 1,478 contracts (divergence from other open interest changes), then traded at HIGH of $2.20 on Thursday.

Thinking ... that's either the STUPIDEST or SMARTEST money in the QQQQ Market at this point. Somebody thinks the QQQQ has $38 + $2.20 = $40.20 potential, somebody doesn't think it has more than that.

STUPIDEST ... for lack of better term. What does a BUYER of $2.20 hint at? I think ... I'm VERY, VERY, VERY short (the QQQQ or NAKED CALL) and I'll pay just about anything at this point to get hedged, or call it quits. It is not uncommon for a QQQQ trader to take advantage of that and inflict as much pain against the "wrong side" of a trade as they can.

In the 11/03/05 Option Chain (first link), I added UpTickVolume and DownTickVolume.

Great and VERY INFORMATIVE, thought provoking conversation today between Jonathan and George ... see 11/03/05 (09:20:08 AM & 12:33:41 PM). That type of thought process is taking trading to the next level. Something a focused QQQQ trader should be doing and monitoring on an ongoing basis.

Maybe up/down tick volume sheds some light on those thoughts. Price action too.

Jeff Bailey : 11/4/2005 12:11:39 AM

Jonathan ... just seeing your 11/03/05 08:01:54 AM post. I've been feeling a little under the weather this week. Very tired, like I'm coming down with something.

OI Technical Staff : 11/3/2005 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 : 11/3/2005 5:21:27 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 11/3/2005 5:14:52 PM

New Zealand's Export Commodities Decline for Fifth Straight Month in October ... DJ - World prices for New Zealand's export commodities declined for the fifth straight month in October, extending their gradual correction from record highs earlier this year, according to an ANZ Commodity Price Index report issued Friday.

The report said the October world commodity price index fell 0.7% from September, and is now 3.6% below the peak recorded in May this year.

The New Zealand dollar strengthened against all major currencies except the U.S. dollar in October, ANZ Bank said, meaning the October commodity price drop in New Zealand dollar terms was larger, at 0.9% on month.

"In recent months commodity prices have corrected from record highs earlier in the year, under the influence of a maturing global growth cycle and a sharp decline in apple prices," ANZ Bank said.

Leading the index lower in October was a sharp fall in the price of lamb skins, which hit a two-year low due to a growing surplus of lamb skins worldwide, ANZ Bank said.

Jeff Bailey : 11/3/2005 5:06:27 PM

Closing Internals found at this Link

Jeff Bailey : 11/3/2005 4:47:50 PM

Current OPEN MM Profiles found at this Link

Today's Activity ... Speculated on a bearish jury verdict with five (5) of the Merck MRK Nov. $27.50 Puts (MRK-WY) at the offer of $0.50. Never able to sell at profiled stop of $0.25 per contract as fast market conditions left no bid on initial bullish reaction to favorable jury verdict. Now trying to salvage at the offer of $0.10.

Bullish day traded long shares of Amgen (AMGN) at the offer of $76.90, but pulled the plug at $77.10 as it appeared that QQQQ MONTHLY R1 was going to hold resistance today. ($0.20, or +0.26%)

Jeff Bailey : 11/3/2005 4:30:59 PM

Bearish put lower exit alert ... Let's lower the exit point to $0.10 on the speculative Merck MRK Nov. 27.50 Put (MRK-WY) ... the world of implied volatility can be so cruel (in the case of this trade) when it compresses.

Linda Piazza : 11/3/2005 4:19:37 PM

OEX Trade Recap
Play officially stopped at OEX 563.11. Entry at 561.70, for a 1.41 OEX move against our position.

I also followed the methodology I use for those traders who did not elect to take the stop. The original suggestion to take full profit for conservative traders and at least partial for others at 559.70 was offered without first being stopped by my methodology. I tried to take the partial-profit route but was so busy posting that I didn't realize that my offer didn't go and so I'm ending the day with a full position. This is as tough on me getting all this right with the posting and my personal trades as it is on you as we iron out the wrinkles between my methodology and OEX-based stops. I'm taking far fewer trades to the detriment of my account, but we'll get this sorted out.

However, I hope you were able to see the difference between my methodology, which did offer profit potential without being stopped and the OEX-based stops. That stop was based on a breakout above the descending trendline off the 9/09 high and the 61.8% retracement of the decline off that high, placing the stop a reasonable amount above both, I thought, and yet it got tagged by $0.14, not much on an options play.

Jeff Bailey : 11/3/2005 4:05:46 PM

Buy Program Premium ...DIA $105.21, SPY $122.22

Linda Piazza : 11/3/2005 3:59:56 PM

The OEX's right shoulder (10 and 15-minute charts) bumped just a little higher than would be wished, but the OEX will likely end the day below the descending trendline off the September 9 high after piercing it.

Linda Piazza : 11/3/2005 3:52:41 PM

OEX Trade Recap
It's time to begin making some end-of-day decisions. We would not be stopped out according to my methodology yet, but it starts again each day. When I advised earlier that all conservative traders should have taken full profits when 559.70 was hit, and others should have taken at least partial profits, taking full profits certainly appeared to be a good thing to do. So far, the advdec line has just done a bear-flag sort of rise into next resistance as the OEX rises so strongly, but meanwhile the OEX has risen right to the descending trendline off the day's high, testing it now . . . breaking over it now. It's again right under the descending trendline off the September 9 high. We may be left with some question marks, depending on the last few minutes of the day. A close beneath the open would have cheered bears, but a close above that descending trendline off the September 9 high is going to cheer bulls, so I would give that some consideration as you make end-of-day decisions. Between that descending trendline off the 9/09 high, at about 526, and the rising regression channel's top resistance, broken today and at about 559.45, the OEX is kind of in a twilight zone, neither one nor the other.

Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing.

Jeff Bailey : 11/3/2005 3:47:56 PM

Thar it goes .... AMGN $77.45 +4.80% ... session high to the close.

Jonathan Levinson : 11/3/2005 3:44:32 PM

I need to step away. See you in tonight's Market Wrap.

Linda Piazza : 11/3/2005 3:42:57 PM

The OEX has confirmed that little inverse H&S. The appropriate level for the right shoulder for the regular one, now with a descending neckline, looks to be somewhere near 561.10, with the OEX currently at 560.84.

Linda Piazza : 11/3/2005 3:41:16 PM

Should be getting our first taste of MOC orders. Looks as if initial thrust is to the upside, but that doesn't always carry through.

Jeff Bailey : 11/3/2005 3:41:12 PM

Taser Intl. (TASR) $7.17 +9.95% ... challenges its post-earnings highs here.

Jonathan Levinson : 11/3/2005 3:38:15 PM

Big volume for QQQQ here, up 126.6M shares so far. Breadth is down to +1.75:1, but unless a big burst of selling comes in, the bears won't be seeing a high volume doji reversal today.

Linda Piazza : 11/3/2005 3:37:13 PM

OEX trying to form an inverse H&S, at the right-shoulder level now, neckline at about 560.62. OEX at 560.25. This would be a small one that could send the OEX up higher into a right-shoulder formation for the larger potential H&S. It's evidence of the bulls trying to gather steam at the expected place, but not absolute evidence they'll succeed.

Linda Piazza : 11/3/2005 3:30:14 PM

Is the OEX rejecting a just-confirmed H&S on its five-minute chart or just trying to form a right shoulder? It could be interpreted either way.

Jeff Bailey : 11/3/2005 3:24:19 PM

June 06 Fed Funds Futures (ff06m) 95.21 -0.05% ... currently predict 15% chance of four (4) 25 bp rate hikes.

Linda Piazza : 11/3/2005 3:23:26 PM

OEX negative on the day. Only slightly and bouncing as I type. It's at the top of its descending regression channel, the one it broke through today, and some other important S/R levels, and this should be good for a bounce attempt. If you're in a bearish play and don't want to weather it, then cinch up your stop.

Linda Piazza : 11/3/2005 3:21:27 PM

The TRAN is below the midline of its latest steeply rising regression channel, off Thursday's low. It's now at the five-minute 100/130-ema's, however, potential support. The 100-ema is at 3961.76, with the TRAN at 3964.13. I knew it had to hit 4000 before they were going to let it decline, but 36 points isn't all that far for the TRAN and there's always the possibility of a last-minute bounce today, too.

Jeff Bailey : 11/3/2005 3:19:53 PM

Russell 2000 Index ($RUT.X) 657.08 (unch) ...

Linda Piazza : 11/3/2005 3:19:01 PM

Advdec line still dropping.

Jeff Bailey : 11/3/2005 3:17:08 PM

03:00 Internals found at this Link

Linda Piazza : 11/3/2005 3:15:21 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing. The OEX has reached our first profit target in the original play (559.70, not 559.50, as I mistakenly said a few minutes ago.) If some are still in the play and following my methodology, I advise exactly what I did when the play opened. Conservative traders take full profits now, and all others, partial.

The OEX has now approached the open, the 240-minute 100/130-ema's, the top of the descending regression channel in which it climbed off the October low, and the 50% retracement of the decline off the September high.

Jonathan Levinson : 11/3/2005 3:10:35 PM

QQQQ's outperforming its peers, holding 39.80 support as the short cycle indicators gather in overbought. Because the longer intraday channels are rolling over, there's a decent chance that 39.80 will crack. Any bulls who were waiting for a pullback to buy, this would be it with a stop just below 39.80. Below that level, 30 min channel support has already retreated to 39.69.

Linda Piazza : 11/3/2005 3:04:31 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing. Advdec line still dropping, and, I hope, accelerating its drop. It's at 598 as I type, its lowest level of the day, but again facing strong support, this on the 60-minute chart, the central basis line. That's at 282 currently, and I'd like to see the drop pick up some steam to plow through that.

Jeff Bailey : 11/3/2005 3:03:31 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 11/3/2005 2:59:22 PM

Volume breadth down to +1.38:1 on the NYSE, +2:1 on the Nasdaq.

Linda Piazza : 11/3/2005 2:55:50 PM

OEX just bouncing where expected. I'd like to see it stay below 562. Well, actually I'd like to see it stay below that, but that would be an appropriate right-shoulder level for its potential H&S. OEX at 560.70.

Jeff Bailey : 11/3/2005 2:54:35 PM

Argentina Oct. CPI up 0.8% on month, up 10.7% on year. October forecast was +0.8%.

Jonathan Levinson : 11/3/2005 2:50:34 PM

QQQQ bounces from 39.80, but heavily so far. The short cycle is growing bottomy, now oversold, but with it and all the other intraday cycles coming down off overbought trending moves, oversold could become moreso on these shorter cycles if 39.80 fails to hold. Link

Jeff Bailey : 11/3/2005 2:49:34 PM

Merck (MRK) $29.29 +3.09% .... MRK-WY still $0.05 x $0.10.

Linda Piazza : 11/3/2005 2:49:08 PM

TRAN bounces from the 3970-ish support I mentioned earlier. It just hit an afternoon (not day's) low of 3971.39 and is now at 3978.08. Five-minute 21-ema at 3986.40, and there's the potential for a H&S on the TRAN's five-minute chart.

Linda Piazza : 11/3/2005 2:46:58 PM

The OEX is dropping down into a test of the 240-minute 100/130-ema's that it leaped above this morning. Those averages are at 558.09 and 559.47, respectively. The OEX also nears a test of the top of the rising regression channel off the October low, having broken through that this morning. It's also nearing a test of the 50% retracement of the decline off the September high, with that at about 558.88, if I've placed the Fib bracket exactly. OEX at 560.26 as I type. These are important levels. They were important on the way up and they'll be important on the way down, and if the OEX should close the day below them, then this will look like a fake-out move that trapped bulls. The close is a long way away, though, and the OEX HOD is not nearly so far away.

Jane Fox : 11/3/2005 2:46:34 PM

It would be quite a coup if the bears can get the AD volume and AD line below 0. AT the rate they are going it looks like they just may.

Jane Fox : 11/3/2005 2:45:28 PM

And both ES and VIX break daily lows and highs at the same time. THe bears have the reins now.

Jeff Bailey : 11/3/2005 2:45:17 PM

Chicago Board of Trade (BOT) $111.00 -1.67% ... all over the board today. High 121.77 and low $107.10 (Daily Pivot = $107.38).

Linda Piazza : 11/3/2005 2:42:53 PM

OEX Keltner view: First support at 559.97-560.49 on 15-minute closes. First resistance at 561.62, with that resistance holding on 15-minute closes over the last couple of hours. If the OEX should get past that resistance, next is at 562.39-563.08, but that still turns higher, so it's difficult to say how strong it is. Next support below that listed above its 556.04-556.56.

Linda Piazza : 11/3/2005 2:40:26 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing. Advdec line dropping more sharply now, but into stronger support, approaching soon. OEX at the five-minute 100-ema. I'd expect a bounce attempt now, so take partial/full profit if still in a bearish play and nervous about it.

Jane Fox : 11/3/2005 2:39:46 PM

The next hurdle for the bears is ES (SPX) daily lows and the VIX daily highs.

Linda Piazza : 11/3/2005 2:38:36 PM

TRAN approaching 3970-ish support. TRAN at 3977.25 as I type.

Linda Piazza : 11/3/2005 2:37:11 PM

Advdec line still dropping. The 300-800 zone is one of strong support, however, with the advdec line now at 1179, QCharts value. Bears want to see it cascade lower this afternoon.

Jonathan Levinson : 11/3/2005 2:35:55 PM

Volume breadth is down to +1.6:1 on the NYSE, +2.2:1 on the Nasdaq. The Nasdaq TRINQ is at the low end of neutral at .47, still showing very strong buying pressure. The TRIN is neutral at .83.

Jeff Bailey : 11/3/2005 2:33:18 PM

Amgen (AMGN) $77.24 +4.50% ... thought that QQQQ slippage would bring weakness to $76.90.

Jeff Bailey : 11/3/2005 2:31:56 PM

QQQQ $39.86 +1.29% ... edges back to WEEKLY R2 after bullish test of MONTHLY R1. Buyers should be abundant back near $39.40-ish if my Option calculations are correct.

Jane Fox : 11/3/2005 2:29:37 PM

OK both ES and the VIX have now broken their respective red trendlines and things continue to get more bearish.

Linda Piazza : 11/3/2005 2:29:11 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing. Remember potential OEX support at the five-minute 100-ema at 560.63. Some might want to take partial profit there, although our original first profit stop was 559.50. Advdec line dropping deeper, so the methodology would still have us in this play, not stopped. It's dropping deeper into potential support, however, so needs to start cascading lower.

Jonathan Levinson : 11/3/2005 2:29:03 PM

QQQQ approaches a potential bounce point at 39.80, combined 30 and 60 min channel support. Given how deeply overbought these cycles are, a break below that channel bottom would suggest a strong test of 39.69 gap support. But in the meantime, the bears need to prove it at 39.80. Link

Jonathan Levinson : 11/3/2005 2:26:44 PM

Session high for crude oil at 61.65, +1.90, with 4 minutes left in the day session.

Jeff Bailey : 11/3/2005 2:25:11 PM

Bullish day trade exit alert .... Amgen (AMGN) $77.10

Jane Fox : 11/3/2005 2:17:50 PM

Right now the AD volume, AD line, VIX and TRIN are telling me we have a battle between the bulls and the bears and there is no clear winner - yet.

Jonathan Levinson : 11/3/2005 2:17:18 PM

Volume breadth is +1.8:1 on the NYSE, +2.35:1 on the Nasdaq.

Jane Fox : 11/3/2005 2:16:16 PM

I have drawn two red trendlines on the ES (SPX) and VIX charts. If both lines break I read this as the bears gaining momemtun and getting stronger. Of course I will need to see a retracement in the AD volume before I move to the bear's corner. Link

Linda Piazza : 11/3/2005 2:16:55 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology, and I promised to keep traders up-to-date on what my methodology is showing. Since being stopped on the official trade, traders have been offered several opportunities to exit at or near breakeven, so I assume that many are thankful to be out of their play. So far, I still would not be exiting by my methodology. The advdec line drops lower. Although I would like to see it cascade lower so that it would drop through the new support it's testing now, at 1340, it's at least good that it's still moving lower. Without that cascading lower, however, each jot down just brings it closer to the support that might hold, so decide whether you want to stay in the play or just be safe and exit.

Jeff Bailey : 11/3/2005 2:12:49 PM

02:00 Internals found at this Link

Jonathan Levinson : 11/3/2005 2:12:18 PM

Session high for crude oil here, +1.75 at 61.50. QQQQ failed at a lower high there, pulling back within its little wavelet bounce.

Jane Fox : 11/3/2005 2:06:59 PM

I truly don't think the bulls are done today.

Jonathan Levinson : 11/3/2005 2:05:30 PM

QQQQ's wavelet cycle indicator (middle oscillator pane) has turned up from a higher, bullish-divergent low. A break back above 40 should confirm a new upphase on that cycle and begin turning up the short cycle indicators (top oscillator pane) as well. Given the very weak sideways downphase, a new upphase from here would have an excellent chance of breaking the session highs. Link

Jeff Bailey : 11/3/2005 2:01:28 PM

02:00 Market Watch found at this Link

Linda Piazza : 11/3/2005 1:58:23 PM

TRAN now finding resistance at its five-minute 21-ema.

Jeff Bailey : 11/3/2005 1:57:44 PM

Quite a few "round looking" numbers in some of the indices.

BIX.X 348 near 350

BKX.X 99.46 near 100.00

BTK.X 648 near 650

SOX 449 near 450.

Linda Piazza : 11/3/2005 1:57:43 PM

Advdec line below the support that held it on the first dip today, but dipping into strong support, beginning at about 1250. Advdec line at 1400.

Jane Fox : 11/3/2005 1:55:22 PM

I may be leaving the bull's corner but I surely do not have enough evidence to move over to the bear's corner yet. "Here I am stuck in the middle with you."

Jonathan Levinson : 11/3/2005 1:52:44 PM

Stepping away for a minute.

Jane Fox : 11/3/2005 1:47:20 PM

Bonds continue to fall putting a lot of downward pressure on equities.

Jane Fox : 11/3/2005 1:45:27 PM

When ES broke out of its bull flag but the VIX did not I suspected it was telling me the breakout would not hold and sure enough it did not.

Linda Piazza : 11/3/2005 1:43:54 PM

The TRAN just had its first five-minute close below the five-minute 21-ema since Tuesday afternoon. This is just a very small chink in the TRAN's armor, but the first one. Be careful as we enter prime-stop-running time for a quick reversal higher.

Linda Piazza : 11/3/2005 1:42:48 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology. Traders have been offered another opportunity to exit, if they didn't stop at the official stop, this time near BE (below on OEX price, but you know those spreads on the OEX options). The play still works by my methodology, with the advdec line dipping and testing the support that held it up today, now at about 1525, with the advdec line at 1517 as I type. I'd like to see it cascade lower below this, but there's deeper support waiting below, too. OEX traders should be aware of the five-minute 100-ema at 560.41 and the likelihood that the OEX could bounce from that, perhaps into a right shoulder for a H&S.

Jonathan Levinson : 11/3/2005 1:38:13 PM

Correction- 4.974B in new cash is being raised by next Monday's 36B of t-bills.

Jonathan Levinson : 11/3/2005 1:36:50 PM

Session high for crude oil, +1.3 at 61.05.

Jonathan Levinson : 11/3/2005 1:36:26 PM

Session low for ten year notes at 107 27/32, TNX up 2.6 bps at 4.636%. There were no treasury auctions, but the Treasury announced the size of Monday's 13- and 26-week bill auction at 36B- raising 4.7B of new cash. This should be a net drain to the market, but, just as we've seen since Fed Tuesday, the market doesn't care.

Jonathan Levinson : 11/3/2005 1:29:30 PM

Zooming out, QQQQ's 30 min cycle indicators remain maxxed out in overbought, no sell signals yet, while the 60 min cycle indicators are still on a bearish kiss, not clearly trending yet. Another hour of this flat action at the highs should be enough to do it. The daily cycle indicators are just approaching overbought, off yesterday's strange bearish kiss, but not looking especially bullish either. Because the move since Tuesday has taken place so quickly, the stochastics and Macds I follow are mostly lagging the price. That's potentially bearish, but this low volume/no action decline isn't going to be enough to tip them over. So far, there's been no real selling, and until that changes, it remains the bulls' show.

Jane Fox : 11/3/2005 1:32:50 PM

ES breaks out of its bull flag but the VIX did not and until it does at well I will consider the ES break as a false break.

Linda Piazza : 11/3/2005 1:18:17 PM

Here's the 240-minute chart I often watch on the OEX: Link Notice that the OEX has pierced that descending trendline off the September 9 high, but hasn't been able to stay above it. The same is true for the 61.8% retracement of the decline off that high. The jury is still out as to what will happen by the end of the day as the OEX did definitely break above the rising regression channel and the 50% retracement and the 240-minute 100/130-ema's. It's retesting the daily versions now, at 561.19 and 561.76, respectively.

Jonathan Levinson : 11/3/2005 1:15:50 PM

Volume breadth is -1.94:1 on the NYSE, -2.31:1 on the Nasdaq. The lack of urgency to the decline off the high feels very bullish to me, and I'm now second-guessing that, wondering if it isn't too obvious that the selling feels slow and corrective.

Jeff Bailey : 11/3/2005 1:15:08 PM

01:00 Internals found at this Link

Linda Piazza : 11/3/2005 1:10:05 PM

OEX Trade Recap
Again as a reminder, our play is officially stopped, but it wouldn't yet be by my methodology. The advdec line again drops to test first support, but hasn't dropped through it yet. However, a stop-running time of day is approaching and the break could be either direction, still, since support hasn't broken. This dip in the OEX is offering those who didn't take the stop another exit, if they're worried or in too deep, and an exit nearer breakeven. I think it's possible that the OEX will dip further, but I would prepare for a bounce from the 560-560.50 zone if it did dip.

Jonathan Levinson : 11/3/2005 1:09:46 PM

QQQQ tested the 72 SMA on that dip but did not break below it: Link

Linda Piazza : 11/3/2005 1:06:51 PM

The OEX is back to the line off the 9/09 high, testing it to see if it's support now. It's also testing Keltner support now at 561.85. Bears would like to see a 15-minute close to begin to limit bounce potential. OEX at 562.07.

Jeff Bailey : 11/3/2005 1:03:18 PM

01:00 Market Watch found at this Link

Linda Piazza : 11/3/2005 12:59:17 PM

TRAN hits 4000 again. HOD at 4002.48. TRAN currently 4000.14. Five-minute 21-ema at 3991.28.

Jonathan Levinson : 11/3/2005 12:56:43 PM

Slight firming in ten year notes, with TNX down to a 2 bp gain at 4.63%. IRX is up .5 bps at 3.842% here.

Jonathan Levinson : 11/3/2005 12:53:04 PM

Volume breadth is down to +2.2:1 on the NYSE, +2.5:1 on the Nasdaq.

Linda Piazza : 11/3/2005 12:53:02 PM

The TRAN is going to try for 4000 again, at 3997.82 as I type.

Tab Gilles : 11/3/2005 12:51:21 PM

Nasdaq100 ($NDX) Keep eye on 1628 level. Link

As per yesterday's post [11:52 AM] added to 1/2 position UOPIX at yesterday's closing NAV of $23.26. This brings fully invested in Profund UltraOTC UOPIX fund which trades 200% leveraged to the $NDX. Previous 1/2 position entered on 10/26 @ $22.66. [posted 10/26 8:34 AM]

Linda Piazza : 11/3/2005 12:48:44 PM

OEX Keltner picture: The OEX needs to close a 15-minute period below a Keltner line currently at 561.80 to begin limiting its bounce potential and provide stronger resistance. The OEX is at 562.36 as I type.

Jonathan Levinson : 11/3/2005 12:46:57 PM

QQQQ's 9 cent pullback off the high is taking a steeper route than the last equivalent pullback, but the short cycle indicators have yet to turn down. 72 SMA support is up to 39.90, a break below which would be the first shift of the day in favor of the bears (on an intraday cycle basis): Link

Linda Piazza : 11/3/2005 12:43:40 PM

OEX Trade Recap
As a reminder, our play is officially stopped (by 13 cents!), but it wouldn't yet be by my methodology. I think conservative traders should have taken the stop, but I promised to update others on what I'm seeing. The advdec line still coils, dropping now to test nearest support. All day, first resistance has been holding, but until the advdec line breaks down further, an upside break can't be ruled out. So, the play still tentatively works, although I would have liked to have seen it perform better, sooner, as far as OEX price. The OEX currently tests that five-minute 21-ema that I've been watching on both the OEX and the TRAN. It's at 562.40 on the OEX, with the OEX at 562.47 and with a few minutes left in the current five-minute period.

Jonathan Levinson : 11/3/2005 12:39:09 PM

SAN FRANCISCO (MarketWatch) -- Standard & Poor's (MHP: news, chart, profile) said on Thursday that operating earnings in the S&P 500 index rose 12.3% in the third quarter, over the same period a year ago. Prior to the hurricane season, S&P had expected a 17% gain in operating earnings for the S&P 500. S&P said it expects operating gains at the index to grow at a double-digit rate in both the fourth quarter and the first quarter of 2006, resulting in 16 consecutive quarters of double-digit gains.

Jeff Bailey : 11/3/2005 12:38:59 PM

Bullish day trade raise stop alert ... for Amgen (AMGN) $77.15 +4.39% ... to break even.

Either buyers drive it to WEEKLY R2 $78.27, or they don't. WEEKLY R1 $77.94.

Linda Piazza : 11/3/2005 12:35:52 PM

TRAN at 3999.38. That five-minute 21-ema that's been bouncing it is now at 3988.57.

Jonathan Levinson : 11/3/2005 12:33:41 PM

My reply to George earlier:

What I mean is, they could have also just gone long a bazillion ES futures... or shorted some other puts as part of a spread... you just never know, which is why I've pulled way back from following the p/c ratios and all that.

Linda Piazza : 11/3/2005 12:29:35 PM

TRAN at 4000.59. It wasn't hit immediately with a sell program, but just hanging there are 4000.

Linda Piazza : 11/3/2005 12:26:20 PM

OEX Trade Recap
Our play is officially stopped, but I promised that I would provide other updates on my methodology. The play would not yet be stopped according to that methodology, but it's on risky footing right now. First resistance still holds, but only tentatively. The advdec line still coils. It could still burst higher as easily as lower.

Jeff Bailey : 11/3/2005 12:25:31 PM

Bullish day trade long alert ... for Amgen (AMGN) $76.90 +4.08% here, stop $76.25, target $78.00

Linda Piazza : 11/3/2005 12:22:48 PM

TRAN at 4002.31.

Jane Fox : 11/3/2005 12:22:19 PM

Bears who ignore the AD volume ... well they shouldn't. Link

Linda Piazza : 11/3/2005 12:22:07 PM

OEX Exit Point Alert
Play officially stopped at OEX 563.11. Entry at 561.70, for a 1.41 OEX move against our position. For those following my methodology instead of taking this official stop, the jury is out right now because the advdec line still coils. It's certainly not breaking out with the OEX, but it is testing resistance.

Jane Fox : 11/3/2005 12:20:21 PM

VIX just confirmed the new ES high with a new daily low so the bulls are breathing easier now.

Linda Piazza : 11/3/2005 12:19:02 PM

TRAN 3996.58. 4,000, here it comes.

Linda Piazza : 11/3/2005 12:17:32 PM

VXO, at 11.86, is the lowest its been since October 4.

Jane Fox : 11/3/2005 12:16:56 PM

THe VIX can be a little late but it should confirm the new ES high soon.

Jeff Bailey : 11/3/2005 12:16:38 PM

12:00 Internals found at this Link

Jane Fox : 11/3/2005 12:16:01 PM

The new high on the SP futures was not met with a new low on the VIX so it may be a head fake.

Linda Piazza : 11/3/2005 12:15:28 PM

TRAN approaching its day's high of 3993.80, with the TRAN at 3992.29. Can they resist 4000?

Jonathan Levinson : 11/3/2005 12:15:07 PM

Bonds remain weak, TNX up 2.6 bps at 4.636% and IRX up .5 bps at 3.842%.

Jane Fox : 11/3/2005 12:14:40 PM

AD volume to new daily highs. As along as AD volume is making new daily highs you can be rest assured the bears will not get any traction. On the other hand as along as the AD line lolly gags the bulls will not get any traction and the only one who wins is your broker.

Jonathan Levinson : 11/3/2005 12:13:56 PM

QQQQ breaks 40 for the first time since August, +.66 at 40.01 here. 30 min channel resistance is up to 40.08, the 72 SMA support line up to 39.85. Link

Linda Piazza : 11/3/2005 12:11:54 PM

New HOD on the OEX.

Linda Piazza : 11/3/2005 12:11:20 PM

The advdec line is indicating more potential weakness than is the OEX price. That weakness has not been confirmed by a distinct downturn in the advdec line, but on the short-term outlook, the resistance is beginning to look a little stronger than support. A strong thrust higher can get through that resistance, of course.

Linda Piazza : 11/3/2005 12:09:42 PM

MRK bouncing again.

Linda Piazza : 11/3/2005 12:08:43 PM

Advdec line sinking. Not past all support yet so the danger of a bounce persists, but we want it to be sinking.

Linda Piazza : 11/3/2005 12:07:42 PM

OEX Trade Recap
The methodology that I watch is working okay still, but not great. The advdec line is coiling between support and resistance, but easing a little below a key level as I type, and as the OEX bounces--go figure. With the advdec line mired between strong support and strong resistance, the direction of the breakout cannot be determined yet, but we of course want a downside break. I'd certainly suggest that most traders take the 563.11 stop if hit, but I'll let everyone else know what I see if they want to follow my methodology. Right now, it's a draw, but slightly weighted still in the favor of a bearish follow-through. Only slightly.

Jane Fox : 11/3/2005 12:07:02 PM

ES tests daily highs three times but the VIX does not test daily lows. Little my little the bearishness is creeping in. Link

Jeff Bailey : 11/3/2005 12:05:05 PM

12:00 Market Watch found at this Link

Linda Piazza : 11/3/2005 12:03:27 PM

The OEX also again attempts a bounce from its five-minute 21-ema, the average that has been supporting it all day. OEX at 562.09, that MA a 561.85.

Linda Piazza : 11/3/2005 12:02:41 PM

The TRAN still hasn't dropped below that five-minute 21-ema, now at 3979.48, with the TRAN now at 3984.28. When the TRAN does give way, you would think it would blow a tire and drive off the side of this road of a climbing regression channel, but it's not showing even early signs of doing so.

Jeff Bailey : 11/3/2005 12:01:24 PM

Merck (MRK) $29.64 +4.32% ... retraces 50% of intra-day range.

MRK-WY $0.05 x $0.10 still

Jonathan Levinson : 11/3/2005 11:57:36 AM

Stepping away for a few minutes.

Linda Piazza : 11/3/2005 11:55:25 AM

The TRAN is attempting another bounce from that five-minute 21-ema, not even dropping down to that average and touching it this time. The TRAN-ish exuberance has not been overcome yet.

Jeff Bailey : 11/3/2005 11:55:07 AM

10 Most Active ... QQQQ $39.93 +1.52%, ORCL $12.21 -2.08%, SPY $122.450 +0.61%, JDSU $2.34 +5.40%, MSFT $26.46 (unch), PFE $22.00 +1.80%, INTC $23.85 +2.36%, SUNW $3.81 +1.87%, ABGX $12.79 +36.49%, IWM $66.02 +0.96%

Jonathan Levinson : 11/3/2005 11:53:58 AM

QQQQ is showing big volume today, 66M already traded compared with yesterday's total for the day at 101.6M. The average daily volume is 102.5M.

Linda Piazza : 11/3/2005 11:51:58 AM

Keene, I get myself into trouble every time I talk about Dow theory, because there's always some little wrinkle about it that I missed.

Jeff Bailey : 11/3/2005 11:51:51 AM

Shoe stocks are hot today ... GCO $39.19 +3.67%, DSW $23.35 +11.45%, PSS $19.42 +2.37%

Keene Little : 11/3/2005 11:50:46 AM

Linda, what's amazing about the TRAN is that it's pushing to all-time highs while the DOW can't even best the March high or the July high or the Sept high or the October high. Talk about non-confirmation per Dow Theory! The DOW better get it in gear otherwise that non-confirmation could be very telling.

Linda Piazza : 11/3/2005 11:50:37 AM

Since yesterday morning, the TRAN has been bouncing from the five-minute 21-ema, currently at 3977.81. It would take a TRAN move below that to even begin to change the tenor of the TRAN, even on the very shortest term period. The TRAN is at 3982.06, dipping toward a test of that average. Even then, I'm seeing a potential H&S on the TRAN, so I'm expecting a bounce, perhaps after a first violation of that MA. And then, there's that magic draw of the 4,000 level. With the TRAN ending the day last Thursday at 3674.32 and up more than 300 points in a straight-up climb, I'm thinking this thing needs a breather, doesn't it? I know the TRAN overruns targets, but . . .

Jonathan Levinson : 11/3/2005 11:48:19 AM

Volume breadth is +2.27:1 on both the NYSE and the Nasdaq.

Jane Fox : 11/3/2005 11:46:39 AM

Fixed the link in my last post.

Jane Fox : 11/3/2005 11:46:14 AM

This is still tellling us we will remain choppy but with a bullish bend. Link

Jonathan Levinson : 11/3/2005 11:43:35 AM

Natgas is up .095 at 11.70, crude oil +.55 at 60.30 here.

Jeff Bailey : 11/3/2005 11:43:58 AM

Merck (MRK) $29.93 +5.35% ... correction to earlier postings. "Bad ticks" have now been corrected in what was a very fast market. Session high has been $30.90, not $35.00 as posted earlier.

The MRK-WY currently $0.05 x $0.10

Linda Piazza : 11/3/2005 11:42:56 AM

Oh, go ahead, Trannies, and push it up to 4,000, so we can get this over with. TRAN high at 3993.80 today. Currently at 3983.63, clinging to the top of a rising regression channel.

Jane Fox : 11/3/2005 11:41:36 AM

AD volume presses to new daily highs.

Jeff Bailey : 11/3/2005 11:39:02 AM

EIA Weekly Nat. Gas Inventory Table found at this Link

Linda Piazza : 11/3/2005 11:35:09 AM

OEX Trade Recap
That OEX formation has begun to look like a bullish right triangle--flat top at the 61.8% retracement of the drop off the 9/09 low and rising supporting trendline. There are bearish price/RSI divergences at each test of the high. My methodology still shows the play tentatively working, but bears would like to see the OEX below the 561.60 level again soon.

Jonathan Levinson : 11/3/2005 11:34:17 AM

Extended grows more extended, QQQQ now perched above the previous highs. The 30/60 min channels are rising steeply, 30 min resistance up to 40.03 and the 72 SMA at 39.82. Above that level, the bulls remain in the driver's seat. Link

Linda Piazza : 11/3/2005 11:22:50 AM

OEX Trade Recap
So far, the methodology behind the bearish play is still working fine, but I'm watching closely now on behalf of conservative traders as the advdec line retests first resistance. Stronger resistance is higher, but it's this resistance we'd like to see hold, with the advdec line staying beneath about 2200-2300. So far, it's holding, but the advdec line has settled into a coiling formation and could break either direction. I think I'd advise at this point that the most conservative traders do stop out if that stop is reached, at which point the official play will be closed anyway.

Jane Fox : 11/3/2005 11:22:37 AM

If you believe like I do that yields play a part in the equity markets then I would take heed of the MACD divergence on this chart and that bonds may be finding a bottom and may take a trip back to the upper trendline of the its downward channel. This would put downward pressure on the yield and give equities a boost. Link

Jeff Bailey : 11/3/2005 11:20:45 AM

KLA-Tencor (KLAC) $50.20 +3.99% ....

Linda Piazza : 11/3/2005 11:18:09 AM

OEX Keltner outlook: The OEX needs to close a 15-minute period below a Keltner line currently at 560.94 to limit the potential for it to keep rising. OEX at 562.26 now, and rising.

Jeff Bailey : 11/3/2005 11:19:19 AM

QQQQ $39.93 +1.47% ... at DAILY R2! MONTHLY R1 $40.06 should be the near-term resistance to this very bullish run.

Jonathan Levinson : 11/3/2005 11:15:19 AM

QQQQ's short cycle indicators are maxxed out, ditto the 30 min cycle (and trending), and the 60 min oscillators are as overbought as they've been in a month. The daily cycle indicators are toppy but not yet maxxed out, while the weekly has stalled its downphase and is on a bullish kiss. My interpretation is that some kind of pullback is due, potentially to last for 2-3 weeks if the daily cycle actually turns back down. If these overbought cycles don't correct now, then we're looking at a new rally leg on the weekly cycle, which would be the "Santa Claus" arriving early. On an idealized cycle basis, the correction down is the more likely outcome, but the price will go where it wants. These are key levels for bulls and bears alike.

Jane Fox : 11/3/2005 11:14:16 AM

Bonds continue to make lower lows and lower highs putting upward pressure on the yield. This is taking its toll in the equity markets and I think the reason they have had so little direction since the October 13th lows.

Jeff Bailey : 11/3/2005 11:12:54 AM

Yesterday's Internals found at this Link

Jeff Bailey : 11/3/2005 11:10:39 AM

11:00 Internals found at this Link

Jonathan Levinson : 11/3/2005 11:07:03 AM

QQQQ's 30 min cycle has finally caught up to the price action, settling flat on a 39.60-40.00 range. The 72 SMA is up to 39.74, above which this cycle maintains a bullish bias: Link

Jane Fox : 11/3/2005 11:05:31 AM

I think my posts on the market internals are more appropriate here in the options side so I will try to jump back and forth and do the market internals here and any futures commentary on the other side.

When the AD volume is bullish and making new daily highs but the AD line is only so so you can be rest assured we will have a sideways day. These two need to be supporting each other for a directional day like yesterday. Link

Jeff Bailey : 11/3/2005 11:03:14 AM

11:00 Market Watch found at this Link

Linda Piazza : 11/3/2005 11:03:40 AM

TRAN still climbing and that's bad, bad, bad for shorts. It's at 3987.88 as I type, and almost assuredly headed for a test of 4000. One chart I have says 4181.81 is possible. The question is whether 3987.88 is close enough to have constituted that test.

Jane Fox : 11/3/2005 11:01:50 AM

AD volume to new highs here and the bulls are pulling the rabbit out of the hat.

Linda Piazza : 11/3/2005 11:01:11 AM

OEX Trade Recap
Back. Everything still working okay according to my methodology. I'm worried about the market-sentiment-positive effect of the MRK case, but so far, it's okay. Expect another bounce attempt soon, however, perhaps after a few minutes more of sideways trading or even after a brief dip.

Jonathan Levinson : 11/3/2005 10:54:33 AM

Headline:

[MRK] MERCK SPOKESMAN: ABOUT 6,400 VIOXX-RELATED CASES FILED

Jonathan Levinson : 11/3/2005 10:54:06 AM

Bad tick for QQQQ down to 38.85, probably just a typo... Quotetracker users can hit ctrl-shift-L to remove it.

Linda Piazza : 11/3/2005 10:52:05 AM

I need to shut down my system for a few minutes and boot back up.

Jonathan Levinson : 11/3/2005 10:51:08 AM

Marketwatch reports that MRK is not liable in this suit, but faces more than 6,000 additional suits. It has already been found liable in a $253 million judgment in fabor the widow of a Vioxx user.

Linda Piazza : 11/3/2005 10:50:53 AM

OEX Trade Recap
So far, the advdec line has performed as we would have hoped, but I'm not sure it's through bouncing. Coming down to test the same support setup that bounce it earlier. So far, so good.

Jeff Bailey : 11/3/2005 10:49:30 AM

Saks (SKS) $18.49 +0.92% ... October comps up 4.6%

Linda Piazza : 11/3/2005 10:48:14 AM

MRK shot up huge after the announcement. It's at $30.21 as I type, at sub-$28.50 before it.

Jeff Bailey : 11/3/2005 10:48:31 AM

Merck (MRK) $30.50 +7.28% .... Speculative Put update alert. Stock surged to as high as $35.00 on heavy volume on favorable jury verdict.

MRK Nov. $27.50 Puts (MRK-WY) were not able to trade a stop limit of $0.25 and went "no bid" to $0.05 offer.

Place an offer to sell at $0.15 at this point.

Linda Piazza : 11/3/2005 10:46:01 AM

Definite bearish divergence building on the OEX's five-minute chart. Could still be erased, but it's there now.

Linda Piazza : 11/3/2005 10:46:12 AM

Was that a Merck-induced bounce? Vioxx case won and that may build market enthusiasm and ruin our play. Again.

Linda Piazza : 11/3/2005 10:40:28 AM

OEX Trade Recap
Bounce in the advdec line, just from a little lower than originally expected, up to test resistance again. It's carrying the OEX pretty high, so it may grab our stop. I haven't gotten a get-out signal yet according to my methodology, but I can't guarantee how the advdec line will behave at resistance until it retests it. I can just say that I expected a retest, just a bit earlier than has happened.

Jonathan Levinson : 11/3/2005 10:40:02 AM

And here's the obligatory pullback after nailing the stop.

Jonathan Levinson : 11/3/2005 10:39:26 AM

QQQQ - Exit Point Alert -

Out QQQQ at 39.90, -.08

Jeff Bailey : 11/3/2005 10:37:16 AM

Merck (MRK) $30.00 +5.00% ... very active. Verdict "in favor" of MRK

Jeff Bailey : 11/3/2005 10:35:52 AM

Merck (MRK) $28.65 +0.84% ... Judge enters courtroom in New Jersey Vioxx trial.

Jonathan Levinson : 11/3/2005 10:34:17 AM

Headlines:

GREENSPAN: FED 'FIRM' INFLATION OF 70S SHOULD NOT RETURN

GREENSPAN: HIGH WINTER HEATING BILLS WILL SURPRISE CONSUMERS

Jonathan Levinson : 11/3/2005 10:32:50 AM

Headline:

U.S. NATURAL GAS STKS UP 29 BLN CUBIC FT: ENERGY DEPT

Natgas is currently up .115 at 11.72, 21 cents off its high.

Jeff Bailey : 11/3/2005 10:32:32 AM

Swing trade speculative put alert ... for five (5) of the Merck MRK Nov. $27.50 Puts (MRK-WY) at the offer of $0.50. Stop $0.25, target $1.00

Linda Piazza : 11/3/2005 10:32:16 AM

TRAN pulling back, but not much and looking bull-flag-ish so far.

Linda Piazza : 11/3/2005 10:28:24 AM

OEX Exit Point Alert
Advdec line loses first support, at least tentatively. Conservative trades take all profit at 559.70, if reached. Others take partial profit.

Jonathan Levinson : 11/3/2005 10:26:09 AM

QQQQ pulls down to test gap support at 39.69.

Jonathan Levinson : 11/3/2005 10:23:43 AM

Ten year notes hold at the lows, TNX now up 2.4 bps at 4.634%. IRX is still down 1 bp at 3.827%, steepening the yield curve.

Jeff Bailey : 11/3/2005 10:22:44 AM

Merck (MRK) $28.94 +1.90% .... Nov. $27.50 Put (MRK-WY) $0.60 jumps to most active (2,282:19,950)

Linda Piazza : 11/3/2005 10:20:54 AM

OEX Trade Recap
The predicted bounce attempt begins. Nothing alarming so far.

Jonathan Levinson : 11/3/2005 10:20:45 AM

WASHINGTON (MarketWatch) -- Activity in the U.S. services sector accelerated in October, the Institute for Supply Management said Thursday. The ISM nonmanufacturing index rose to 60% in October from 53.3% in September. Economists were expecting a smaller increase to about 56.9%. The new orders index rose to 58.2% from 56.6%, while the prices paid index fell to 78% from 81.4%.

Jeff Bailey : 11/3/2005 10:20:19 AM

Merck (MRK) $29.14 +2.56% ... Nov. $30 Call (MRK-KF) $0.90 is most active at 1,748:20,399.

Jonathan Levinson : 11/3/2005 10:18:51 AM

Volume breadth is down to +2.4:1 on the NYSE, +2.5:1 on the Nasdaq, still strong.

Jeff Bailey : 11/3/2005 10:18:29 AM

Dollar General (DG) $19.13 -2.94% ... Oct. comps up 0.4%.

Jeff Bailey : 11/3/2005 10:16:36 AM

Merck (MRK) $28.70 +1.02% ... gets active on CNBC report that VIOXX jury has reached a verdict.

Jonathan Levinson : 11/3/2005 10:15:24 AM

Headlines:

[GDT] NY ATTY GEN SPITZER SUES GUIDANT OVER HEART DEFIBRILLATORS

[GDT] SPITZER ALLEGES GUIDANT HID HEART DEFIBRILLATOR DESIGN FLAW

[GDT] SPITZER ALLEGES GUIDANT FAILED TO INFORM DOCTORS OF DEFECT

[GDT] SPITZER GUIDANT SUIT CONCERNS VENTAK PRIZM 2 DR MODEL 1861

GDT is down 4.5% here at 57.68.

Jeff Bailey : 11/3/2005 10:15:24 AM

10:00 Internals found at this Link

Jonathan Levinson : 11/3/2005 10:14:26 AM

QQQQ's short cycle upphase is stalled, but the decline is so far sideways and inconsequential compared with the big gap up that preceded it. Gap support at 39.69-.70 is the key here, and currently the surge above the upper 30/60 min channels has been so sharp that it's distorted these indicators. 72 SMA support is actually below the lower 30 min channel bottom- usually, it serves as the midpoint: Link

Linda Piazza : 11/3/2005 10:13:46 AM

OEX Trade Recap
Here's where the bounce potential comes in. Look for a potential bounce soon, but we won't be alarmed by it if the methodology is still working. Unless the OEX hits the stop anyway. I'll let you know what I see if you want to just follow my methodology and not take that stop, placed just above the 61.8% retracement of the decline off the 9/09 high. It's a valid stop, but I'll be basing my own exit on different parameters and I'll keep you up to date.

Linda Piazza : 11/3/2005 10:09:31 AM

OEX Trade Recap
Trade working as expected by my methodology, so far. One more push higher can't be ruled out yet.

Jeff Bailey : 11/3/2005 10:05:50 AM

10:00 Market Watch found at this Link

Linda Piazza : 11/3/2005 10:05:08 AM

OEX Entry Point Alert
Our entry was at OEX 561.70. OEX now at 561.90. I'll tell you soon if I think it's not working.

Linda Piazza : 11/3/2005 10:03:19 AM

OEX Entry Point Alert
Enter bearish OEX trade. Stop 563.11.

Jonathan Levinson : 11/3/2005 10:03:12 AM

ISM Services 60 vs. 57 exp.

Jeff Bailey : 11/3/2005 10:03:26 AM

Hemispherx Biopharma (AMEX:HEB) $3.02 +11.85% ... Company saying that a NIH-supported independent study at Utah State University has recently completed research that shows Ampligen, a Hemispherx experimental immunomodulator, demonstrates strong therapeutic synergy with Relenza (Zanamivir) on an influenza H5N1 infection. Co says "This combination may permit the use of lower dosages and fewer injections of the antivirals and vaccines used to combat avian flu, thereby decreasing the cost of both immunization programs and treatment programs for the full-blown disease."

Bird Flu

Jonathan Levinson : 11/3/2005 10:02:44 AM

Session low for 10-yr bonds, TNX +.4 bps to 4.614%.

Jonathan Levinson : 11/3/2005 10:02:24 AM

Headlines:

U.S. SEPT. FACTORY ORDERS FALL 1.7%, MORE THAN EXPECTED

U.S. AUG. FACTORY ORDERS RISE REVISED 2.9%

Jonathan Levinson : 11/3/2005 10:01:46 AM

Headlines:

GREENSPAN: U.S. ECONOMIC FUNDAMENTALS REMAIN FIRM

GREENSPAN: U.S. ECONOMY HAS 'IMPORTANT FORWARD MOMENTUM'

GREENSPAN: HURRICANES TO EXTERT DRAG ON JOBS, OUTPUT

GREENSPAN: HURRICANES ADD TO UPWARD PRESSURES ON PRICES

GREENSPAN: REBUILDING WILL BOOST GDP FOR A WHILE

GREENSPAN: UNCERTAINTY SURROUNDS OUTLOOK FOR INFLATION

GREENSPAN: GLOBAL FORCES HOLDING DOWN INFLATION FOR A TIME

GREENSPAN WARNS BUDGET DEFICIT COULD CAUSE SERIOUS DISRUPTION

Jonathan Levinson : 11/3/2005 10:00:45 AM

Greenspan's prepared remarks at this Link

Linda Piazza : 11/3/2005 9:59:47 AM

Advdec line up against or nearly against the same resistance that stopped it yesterday.

Jonathan Levinson : 11/3/2005 9:55:40 AM

A 5.5B overnight repo results in a net 2B add for the day, driving the stop out rate down 2 bps to 3.97 and below the 4% target rate. Awaiting the 10AM Factory Orders and ISM data.

Jeff Bailey : 11/3/2005 9:55:38 AM

Abgenix (ABGX) $13.02 +38.95% .... is Amgen (AMGN) partner for Panitumamab. (see 09:51:20 AM)

Linda Piazza : 11/3/2005 9:53:32 AM

TRAN now at the top of the new rising regression channel, one drawn off the Thursday swing low, when it started its straight-up climb, and not off the October low. TRAN at 3970.21 as I type. I'm watching now to see if it reverses from the top of this new channel or breaks out of it, as it did out of another.

Jeff Bailey : 11/3/2005 9:51:20 AM

Amgen (AMGN) $76.87 +4.01% ... NDX/QQQQ heavyweight sharply higher after the company said Panitumumab significantly improved progression-free survival in Phase III randomized metastatic colorectal cancer studay.

Jonathan Levinson : 11/3/2005 9:51:14 AM

The Fed has 10.5B in various repos expiring, and has so far rolled over the 14-day money with a new 14-day 7B repo, leving 3.5B with which to deal in the coming minutes.

Jonathan Levinson : 11/3/2005 9:48:37 AM

Headlines:

FED MUST MAINTAIN CREDIBILITY AS INFLATION-FIGHTER: FERGUSON

LOW INFLATION NECESSARY FOR LONG-TERM GROWTH: FERGUSON

FED WON'T GO SOFT ON INFLATION, FERGUSON SAYS

Linda Piazza : 11/3/2005 9:47:12 AM

OEX now at daily 100/130-ema's.

Jonathan Levinson : 11/3/2005 9:47:01 AM

QQQQ - Entry Point Alert -

Short QQQQ at 39.82s top 39.90

Linda Piazza : 11/3/2005 9:46:51 AM

OEX 561.23 is the 38.2% retracement of the entire bear-market decline, and this level has some significance in historical S/R, of course. OEX 561.53.

Jeff Bailey : 11/3/2005 9:46:11 AM

Yesterday's QQQQ Option Chain of November most actives at this Link

Jonathan Levinson : 11/3/2005 9:44:51 AM

QQQQ - Exit Point Alert -

Out QQQQ at 39.80, -.06

Linda Piazza : 11/3/2005 9:42:01 AM

We have factory orders and ISM services in twenty minutes, natural gas inventories a little later. Greenspan speaks. Lots of uncertainty here, although the natural-gas inventories may be the only number that will be market-moving. I'm not issuing a new play until things are clearer.

Linda Piazza : 11/3/2005 9:40:01 AM

OEX hitting the descending trendline off the 9/09 high. Here's where it is on the nested Keltner basis. The resistance is obvious here, but there can and are sometimes breakouts from these channels: Link I'm not getting a signal either way from my methodology, although there was an early and very tentative long signal. I just wasn't going to take it with the OEX about to run up against that descending trendline off the 9/09 low, and with the signal being tentative.

Jeff Bailey : 11/3/2005 9:36:41 AM

Beetle's Balanced Benchmark Alert ... QQQQ and IWM first asset classes other than the dollar to show gain since 09/30/05. Beetle's Balanced at this Link

Linda Piazza : 11/3/2005 9:35:39 AM

TRAN still climbing and I've redrawn my rising regression channel with that showing the possibility of a climb into 3965-3970 before hitting the top. On other time intervals, the TRAN has already hit the top.

Linda Piazza : 11/3/2005 9:33:30 AM

The OEX is rising straight up into that descending trendline off the 9/09 high, with that at about 561.70 and with the 61.8% retracement of the decline off that high just below that. Bulls, time to start profit-protecting measures and perhaps take a little profit off the table, allowing for some participation in further gains if they should occur. So far, the advdec line is performing fine, setting up as it did yesterday, but watch this resistance.

Jonathan Levinson : 11/3/2005 9:32:29 AM

Volume breadth is +4.15:1 on the NYSE, +3.53:1 on the Nasdaq at the open.

Linda Piazza : 11/3/2005 9:31:46 AM

Advdec line opens in a support zone and moves up through it. Could be a repeat of yesterday, but it's hitting resistance already on one chart and I'm watching to see how it behaves there. Bulls don't want to see a rollover from 1300-1600, now being tested.

Jonathan Levinson : 11/3/2005 9:31:45 AM

That's a high-risk entry. I have to follow my indicators, however, and they're telling me that this move will be very difficult to sustain. We'll see. Link

Jonathan Levinson : 11/3/2005 9:30:35 AM

QQQQ - Entry Point Alert -

Short QQQQ at 39.74 stop <39.80

Linda Piazza : 11/3/2005 9:30:01 AM

Mark just mentioned that no one in the mainstream media mentions that descending trendline from 2003. I'm not hearing anyone in the mainstream media mention that the Nikkei is up against a really long-term descending trendline, that off the late 1989/early 1990 high: Link

Linda Piazza : 11/3/2005 9:25:22 AM

OEX Trade Recap
I forgot to post this last night.
Bearish entry yesterday at OEX 556.87. Stopped at 558.45. The OEX moved 1.58 points against the play.

I'm still tinkering with how I should post these trades and determine an appropriate OEX-based exit when I'm basing my entries and exits on a different methodology. According to that methodology, that play would not have been stopped yesterday, which might be a good thing or a bad thing this morning, as I wouldn't be surprised to see some follow-through up to test the descending trendline off the September 9 high. This morning could set up so that the stop would occur.

I'm considering just posting the entry and exit, telling you to set your own account-appropriate stops, but letting you know when I think things might be going right/wrong for conservative traders, when for aggressive. My fear, one I mentioned when I first began posting trades and urging traders to just paper trade them for now, is that these OEX-based exits are going to stop you out more frequently than I'm stopped out in my personal trades, thereby giving a worse performance profile than I've seen. Give me feedback about what you want.

Also, my methodology is somewhat complex for those who are not familiar with nested Keltner channels. From my own research, I think Jonathan and I are among the few who know a lot about these, as I don't find many articles written on the subject. Do you want to know all the nitty gritty of what I'm seeing, or just a enter here/exit here update and a little discussion here and there about how the trade is working/not working? Write by clicking on "Contact Us" and then on support, putting my name and/or OEX trades in the subject bar.

Jonathan Levinson : 11/3/2005 9:20:08 AM

Remember your great short entry at $39.74? You could get a second chance at that!

Good point, although with the Qs above that descending daily trendline, it doesn't look quite as tasty as it did back then. With that said, however, price is again above upper channel resistance, and all the intraday cycles are maxxed out. The daily should be pretty close as well. This has the makings of a blowoff doji day, but I'd rather sit on my hands and see how it goes before jumping in front of the train. The year highs just above 40 are within spitting distance.

Jonathan Levinson : 11/3/2005 8:58:00 AM

QQQQ above 39.50 has broken above the daily descending resistance line since the August high. Only a gap&crap open back below the pennant apex would neutralize what is a very bullish picture. The bearish kiss on the 10 day stochastic will be history as of the open if the move doesn't reverse immediately. Daily QQQQ chart as of yesterday's close: Link

Jonathan Levinson : 11/3/2005 8:51:08 AM

Headline:

ECB TRICHET SAYS COULD MOVE ON RATES 'AT ANY TIME'

8:49am ECB TRICHET SAYS DISCUSSED RATE HIKE POSSIBILITY

Jonathan Levinson : 11/3/2005 8:32:14 AM

New highs across the board for equities, QQQQ up .27 at 39.62. Bonds are also higher, TNX now down 2.1 bps at 4.589%.

Jonathan Levinson : 11/3/2005 8:31:19 AM

Headlines:

U.S. WEEKLY JOBLESS CLAIMS DOWN 8,000 TO 323,000

U.S. JOBLESS CLAIMS FALL TO LOWEST LEVELS SINCE KATRINA

U.S. 4-WEEK AVG. JOBLESS CLAIMS DOWN 17,000 TO 350,500

U.S. CONTINUING JOBLESS CLAIMS DOWN 44,000 TO 2.82 MLN

U.S. Q3 PRODUCTIVITY RISES 4.1% VS. 2.6% EXPECTED

U.S. Q3 UNIT LABOR COSTS DOWN 0.5%, UP 2.7% YR-ON-YR

U.S. Q2 PRODUCTIVITY REVISED TO UP 2.1% FROM 1.8% PREV

Jonathan Levinson : 11/3/2005 8:24:57 AM

Bonds hold a light gain, TNX down .4 bps at 4.606%, and the IRX is down .7 bps at 3.83%.

Linda Piazza : 11/3/2005 8:07:25 AM

Thanks, Jonathan, for posting the ECB information. I was out jogging with the dogs before the market day started, after completing the Asia/Europe report, and had just returned to post the OEX update and then look up the ECB information. Beautiful morning here, and I sure wish I could see my laptop monitor in the sunlight, because I'd be working today out on my courtyard.

Linda Piazza : 11/3/2005 8:03:19 AM

I took a look at an old OEX weekly chart last night, and here's what I saw: Link The thick horizontal red line is a zone of long-term historical S/R carried forward. Here's what that chart looks like on a daily view, with the OEX having risen yesterday to test its important 72-ema, the thick aqua-colored line. Link And here's an entirely different view, a 240-minute one showing the rising regression channel off the October low, the 50% retracement of the drop off the September 9 high, the important 240-minute 100/130-ema's (their importance easily visible on that chart) and the descending trendline off the September high: Link

The first chart shows a confusing, churning formation on the weekly chart, the second a rise into the 50- and 72-ema's on the daily chart, a breakout attempt, and the third, the OEX's struggle at multiple levels of resistance. The rising regression channel on that 240-minute chart is larger than that typically see on a bear-flag climb. It's wider in relationship to the decline that preceded it. Perhaps it's the beginning of a bounce up from the October lows. Even if it is, though, the OEX has hit the top of that channel. Unless it's going to break to the upside through that channel and become vertical, as the TRAN's climb over the last week has been, it might be time for the OEX to pull back. The 60-minute chart (not shown) displayed bearish divergence when compared with Monday's rise, with the 30-minute chart showing even more pronounced bearish divergence. Bearish divergences serve as warnings only, of course, but they will mean something at some time, and, when they show up on the 60-minute chart, they serve a clear warning to bulls to be careful. A breakout up to 560.50-562 can't be ruled out to test resistance at that level, however.

Many indices ended the day yesterday at key levels, but we'll be particularly watching the market-leader TRAN to see how it behaves this morning. A sharp pullback in the TRAN could snap other indices back, too, while a bounce or more measured pullback might be market positive. For now, resistance holds on the OEX, and we look for either a rollover beneath that resistance or a break through, with internals matching the direction.

Jonathan Levinson : 11/3/2005 8:01:54 AM

From UPI:

GUANGZHOU, China, Nov. 3 (UPI) -- A woman died of exhaustion after working a 24-hour shift at a Chinese handicraft factory, following weeks of 15-hour days, state media reported Thursday.

Link

Bloomberg reports that the World Bank raised its growth forecast to 6.2% for East Asia in 2005 on so-far faster-than-expected growth. For China, a 9.3% rate is expected, up one percetn from its previous estimate.

Jonathan Levinson : 11/3/2005 7:48:12 AM

The ECB has left its overnight rate at 2%, unchanged since June 2003.

Jonathan Levinson : 11/3/2005 7:09:34 AM

And, lest we forget:

10:00 AM ET : Federal Reserve Chairman Alan Greenspan to testify on the U.S. economic outlook before the Joint Economic Committee of Congress, in Washington

Jonathan Levinson : 11/3/2005 7:04:15 AM

Equities are lightly lower, ES trading 1217.25, NQ 1607.5, YM 10485 and QQQQ 39.47. Gold is up 1.3 to 466, silver +.047 to 7.598, ten year notes +1/8 to a session high of 108 1/4, crude oil +.575 to 60.325 and natgas +.09 to 11.695.

We await the 8:30 releases of Q3 Productivity, est. 2.6%, Initial claims, est. 330K, and at 10AM, Factory Orders, est. -1.0% and ISM Services, est. 57.

Linda Piazza : 11/3/2005 6:54:04 AM

Good morning. The Nikkei was closed last night, and other Asian markets were mixed. European markets turn higher ahead of an ECB decision this morning. As of 6:50 EST, crude was higher by $0.50 to $60.25, and our futures had inched just below the flat-line level. More details about Asian and European markets follows in succeeding paragraphs.

Last night, the Japanese financial markets were closed for Culture Day, a national holiday. Other Asian markets were mixed. The Taiwan Weighted lost 0.21%, but South Korea's Kospi gained 0.79%. Singapore's Straits Times was also closed. Hong Kong's Hang Seng rose 0.03%, but China's Shanghai Composite dropped 0.86%. In October, prices paid by Chinese manufacturers for production materials fell 1.4% from the previous month.

In Asia, stock-specific developments included an almost 3% gain in Samsung Electronics after the company reported earnings and predicted increasing shipments of chips and flat-display panels next year. A Taiwanese bank, Chang Hwa Bank, said that bad loans will cause it to produces more losses this year, but a mainland Chinese bank, China Merchants Bank, had better news. A spokesperson said the bank will produce 20% growth for this fiscal year.

European markets turn higher this morning ahead of an ECB rate decision. The ECB is expected to leave rates steady at 2%, but the real question is whether any hint will be given of an increase in rates at the December meeting. Bond movements suggest a quarter-point hike in December. The climb in European bourses also occurs amid continuing violence in poor Paris suburbs, with cars, buses, garbage receptacles and even a few buildings set afire in last night's rampage. In the U.K., Prime Minister Blair is pushing for reform of the U.K.'s welfare system and has replaced the just-resigned Secretary of State for Work and Pensions David Blunkett with John Hutton, known for his interest in reforming welfare policy.

Services PMI numbers showed encouraging trends. Italy's October Services PMI climbed to 52.8 from its previous 51.7. The current conditions component improved the most, but new business, outstanding business, and employment all rose. Input prices dipped. France's October Services PMI also rose, above expectations to 56.6 from the previous 54.9. New business rose significantly, with employment and business expectations also rising. Input prices also rose significantly, however, with output prices also increasing. The Eurozone Services PMI rose to 54.9 from September's 54.7. Like Italy's, this number was the highest in more than a year. The employment component was unchanged, but above 50. New business, business expectations and input prices were all higher. The U.K.'s Services PMI rose to 56.1 from the previous 55.0, above expectations. New business, employment, and prices charged components all rose, while outstanding business and input prices moderated.

Stock-specific developments included Unilever's decline after reporting earnings that were deemed somewhat shy of expectations, BMW AG's rise after its report of falling net profit and a steady outlook for 2005, and Adidas-Salomon's gain after beating expectations. The London Stock Exchange also gained after its earnings report.

As of 6:46 EST, the FTSE 100 had gained 35.70 points or 0.67%, to trade at 5,394.30. The CAC 40 had gained 38.81 points or 0.88%, to trade at 4,468.46. The DAX had gained 19.61 points or 0.40%, to trade at 4,974.44.

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