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Jeff Bailey : 11/10/2005 12:32:32 AM

QQQQ Closing Option Chain Link ... Things are getting squared up at the $40 strike.

Notable is that while the $39 Calls have the RISK, this option saw a buy bias today. Action since the beginning of the month has me thinking naked call or covered call sellers are doing some buy backs and looking to save some positions.

Split today's $39 Call AvgOHLC of $1.25 and I come up with $0.62. $39 + 0.62 = $39.62 looks like a solid expiration level of support.

No way will the market maker let those $38, $39 put holders off the hook now.

Upper range looks $40 call/put. Take their AvgOHLC of $0.48 + 0.27 = $0.75. Max $40.75 and today's three test of Daily R1 $40.33 (split $0.75).

CSCO a bit of a dampener and my thinking at this point is only way QQQQ busts a move to $40.75 is if the SOX.X, which has come back to life, can bust the move to correlative MONTHLY R1 and WEEKLY R2. Yes... Friday will end the WEEK, but be cognizant of a WEEKLY R1 next week for the SOX.X at 472.89.

I should probably do some similar work on the SOX.X and SMH option chains. You can to. Slit them up just like the QQQQ. Look for the open interest, but think WHO HAS THE RISK and HOW CAN THE MARKET MAKER inflict some PAIN! Look for those levels in your matrix and see if it doesn't make sense.

Jeff Bailey : 11/9/2005 11:51:06 PM

Pivot Matrix for Thursday found at this Link

Jeff Bailey : 11/9/2005 11:28:58 PM

Program Trading Levels for Thursday ... HL Camp & Company has their computers set for program buying at $+3.51 and set for selling at $+1.49.

OI Technical Staff : 11/9/2005 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The Market Monitor has been archived.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 : 11/9/2005 6:30:45 PM

Lucent (LU) $2.78 +1.45% ... steady at $2.77 in extended session.

Jeff Bailey : 11/9/2005 6:29:26 PM

Nortel (NT) $3.21 -1.53% ... plunges to $3.04 in extended session. No news I can find, but must be CSCO-related.

Jeff Bailey : 11/9/2005 5:39:44 PM

QQQQ $40.16 +0.04% ... ticking $40.13 in extended session.

Linda Piazza : 11/9/2005 5:33:05 PM

What did Chambers say to spook people? CSCO dropping almost a point from when I last saw it.

Traders might watch the Asian markets tonight to see how the techs performed (or wait until I report on their performance tomorrow morning) to see a first reaction to CSCO's earning report. That reaction doesn't always carry through to U.S. trading, but at least gives some hint of how markets are perceiving the report.

Jeff Bailey : 11/9/2005 5:37:42 PM

Cisco Systems (CSCO) $17.75 -0.61% ... has been wild in tonight's extended session. Currently $17.40 after trading as high as $18.25 for period of time, then dropping to $17.01 in last 15-minutes.

CSCO reported Q1 net income of $1.3 billion, or $0.20 per share (including items), compared with $1.4 billion, or $0.21 a share in the same period last year. Consensus was for $0.19 (including items).

Cisco officials said if the stock-option expensing rule had been in effect last year, it would have earned $1.12 billion, or $0.17 per share in that period.

Excluding one-time items, CSCO said it earned $1.6 billion, or $0.25 per share on revenue of $6.55 billion (up 10% from year-ago $5.97 billion). Consensus was $0.24 a share and revenue of $6.58 billion.

Jeff Bailey : 11/9/2005 5:22:58 PM

NYSE Stocks hitting new 52-week highs at this Link

NYSE Stocks hitting new 52-week lows at this Link

Jeff Bailey : 11/9/2005 5:15:36 PM

Closing Internals found at this Link

NYSE NH/NL Ratio Chart with five day ratio reversing lower by 3- boxes to 50%. 10-day builds an X to 44% Link

Jeff Bailey : 11/9/2005 4:34:59 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 11/9/2005 4:23:59 PM

Chicago Board of Trade (BOT) $112.17 -4.04% ... I'm not seeing any news that would explain this afternoon's sudden decline.

However, I do see an option chain now present for BOT (no volumes or OI). I'm looking to see if/when the CBOE may have announced option availability for the BOT.

Jeff Bailey : 11/9/2005 4:11:25 PM

Current OPEN MM Profiles found at this Link

Today's CLOSED trades in yellow at this Link

Linda Piazza : 11/9/2005 3:56:46 PM

OEX Trade Recap
Entered a bearish OEX options trade at 561.58. Stopped at OEX 562.70, for a 1.12 OEX move against our position.

Linda Piazza : 11/9/2005 3:54:42 PM

Time for end-of-day decisions on the OEX and other markets. Remember CSCO earnings after the close, as well as economic releases expected tomorrow morning. The OEX popped above the 200-sma and that rising trendline off the spring low, but dropped back below both by the end of the day. Still looks like resistance is holding to me, but so is support. If you're holding overnight, you're having to do partially blindfolded. That long upper candle shadow does not look bullish to me, but the holding of support frustrates any attempt to profit from bearish positions.

Jeff Bailey : 11/9/2005 3:42:50 PM

Chicago Board of Trade (BOT) alert $112.00 -4.19% ... drops suddenly in last 10 minutes from $118.00 level.

Jonathan Levinson : 11/9/2005 3:39:38 PM

I need to step away and will have to miss the CSCO action. QQQQ is breaking back below the 72 SMA here, but volume is so light and far below the average that it could be reversed quickly. The current range has become a blender, and hopefully CSCO will provide the break in either direction. Link

Linda Piazza : 11/9/2005 3:37:20 PM

The advdec line is testing resistance. So far, it's holding, but if I'd actually called the trade I'd been too rattled to post--mea culpa--I'd be pulling traders out of the trade right now ahead of the end-of-day positioning. The OEX would have been between 564.75-565.04 when the entrance was made, and it's at 564.65 as I type, with a first profit having been taken at 563.43 and with conservative traders advised to exit the whole position. And that's how it works. The exit would not have occurred according to my methodology, but I would have wanted to be cautious ahead of CSCO earnings.

Jeff Bailey : 11/9/2005 3:38:06 PM

Mexico Oct. Consumer Prices rose a tepid 0.25%, matching consensus of +0.28%.

On October 28, Mexico's Central Bank lowered overnight rates 25 bp (see MM 10/28/05 12:05:55 PM)

Linda Piazza : 11/9/2005 3:32:12 PM

Michigan's preliminary consumer sentiment for November and the treasury budget will also be released tomorrow, Michigan sentiment at 9:45 and the budget for October at 2:00.

Linda Piazza : 11/9/2005 3:30:07 PM

Tomorrow morning's reports include the September trade gap and import/export price indices.

Jonathan Levinson : 11/9/2005 3:29:59 PM

QQQQ's 30 min cycle is midway through an upphase that started from an early low above oversold territory, while the 60 min cycle is on a bullish kiss, also at its midpoint, after a tractionless downphase. The daily cycle within which all this is occurring is still on a bearish kiss just below oversold territory. The flats are still winning the game, and all the cycles are beginning to drift net sideways, as the up- and down-phases continue to truncate in the early going. It's going to take a sharp move to restore direction to the market, and while the daily cycle suggests a downward move to follow, this range could break in either direction and the cycle indicators would follow along.

Linda Piazza : 11/9/2005 3:26:06 PM

CSCO reports this afternoon. Dell reports tomorrow after the close.

Linda Piazza : 11/9/2005 3:22:16 PM

The SPX rises again to challenge the top of that triangle that had been forming since November 3. It broke above that triangle on the spike-from-nowhere, but then fell back inside it. The top is approximately at 1223.70, with the SPX breaking just above that as I typed.

Jonathan Levinson : 11/9/2005 3:21:30 PM

More on the situation in Jordan:

Explosions hit three hotels in the Jordanian capital Wednesday night, and at least 18 people were killed and 120 wounded.

The first blast occurred at about 8:50 p.m. (1:50 p.m. EST) at the luxury Grand Hyatt hotel, popular with tourists and diplomats, and completely shattered its stone entrance. Associated Press reporter Jamal Halaby, who was at the hotel, counted seven bodies being taken away and many more wounded being carried out on stretchers.

A few minutes later, police reported an explosion at the Radisson SAS Hotel a short distance away. Police said five people were killed and at least 20 were wounded in the blast at a wedding hall.

Another explosion was reported at the Days Inn Hotel, and police said there were casualties.

Link

Jeff Bailey : 11/9/2005 3:19:47 PM

SOX.X 458.75 +1.43% ... comes to highs of the session and another challenge of DAILY R2.

Jeff Bailey : 11/9/2005 3:16:45 PM

03:00 Internals found at this Link

Jeff Bailey : 11/9/2005 3:09:31 PM

Fed Chairman Alan Greenspan ... Receives the Medal of Freedom from President Bush.

Linda Piazza : 11/9/2005 3:09:13 PM

Again, not in an effort to take credit for a trade that I was too rattled to post, but rather to educate how readers as to how my methodology would have worked, I posted a note a few minutes ago that this methodology was showing that partial profit should be taken at OEX 563.43 and that conservative traders should have taken full profit at that point. OEX now at 563.89 and the advdec line is rising again.

Jonathan Levinson : 11/9/2005 3:08:15 PM

QQQQ bounces back to the 72 SMA, currently at 40.20. The short cycle downphase has stalled and the wavelet cycle (middle oscillator pane) has turned up from a bullish divergence: Link

Jeff Bailey : 11/9/2005 3:06:25 PM

03:00 Market Watch found at this Link

Linda Piazza : 11/9/2005 2:58:56 PM

I had a few moments of feeling unsure of myself, with the reader's email questioning my veracity coinciding with that spike in the markets' climb, but fortunately, I had already posted the charts in my 12:49:56 post to show what I was looking at, and backing up what I'm going to say in this post. Now I want to show you what I'm talking about when I speak about "my methodology." Right now, it would be suggesting partial profits from the rollover point, OEX now at 563.43, and full for conservative traders. Link This is not to take credit for a trade I was too rattled to post, but rather to educate readers about what I'm watching.

Jonathan Levinson : 11/9/2005 2:57:10 PM

Good guess, Mark:

Headline:

2:51pm POLICE REPORT THIRD EXPLOSION IN AMMAN, AT DAYS INN -- AP

Jonathan Levinson : 11/9/2005 2:51:55 PM

QQQQ buries all the bids since 12:15PM: Link

Jane Fox : 11/9/2005 2:50:41 PM

TICKS -800 Fickle market isn't it?

Jonathan Levinson : 11/9/2005 2:48:59 PM

Ten year note yields continue higher toward the cash close, TNX now up a big 7.8 bps (1.71% change) at 4.643%, steepening the yield curve agains the 1.5 bp gain in the IRX at 3.877%.

Linda Piazza : 11/9/2005 2:47:54 PM

That spike in equities a while ago broke the SPX above the neutral triangle at the top of its rise, seen easily on the 60-minute chart. However, the SPX is back inside the triangle. Was the SPX just widening that triangle into a rising regression channel, hitting the top or was that a false breakout from the triangle, soon to see follow-through to a test of the bottom support, now at about 1217.25? If there's further pullback, bulls need that support to hold.

Linda Piazza : 11/9/2005 2:39:43 PM

The OEX is back up to test its 200-sma at 564.70, with the OEX at 564.74.

Linda Piazza : 11/9/2005 2:38:48 PM

For the first time since early morning, the TRAN has closed a 15-minute period below a Keltner resistance line now at 3998.34. It's moving up to retest that resistance again, currently at 3999.47 with about half the 15-minute period left. Another 15-minute close beneath that line will mark a short-term change in trend.

Jeff Bailey : 11/9/2005 2:37:21 PM

Hansen Natural (HANS) $64.10 +12.89% Link ... Beverage company surges to a new all-time high after reporting record sales. The company cited growing sales in the energy drink market as being robust.

Jeff Bailey : 11/9/2005 2:33:41 PM

Sonus Networks (SONS) $4.23 -16.4% ... sharply lower today after the company reported a loss of $2.7 million, or $-0.01 a share, compared to a profit of $10.3 million, or $0.04 a share in the year-ago period.

Jonathan Levinson : 11/9/2005 2:32:44 PM

Headline:

2:30pm EXPLOSION AT GRAND HYATT HOTEL IN AMMAN, JORDAN -- AP

Jonathan Levinson : 11/9/2005 2:32:20 PM

QQQQ drifts through 72 SMA support on light volume at 40.19. The pivot at 40.15 is next support. QQQQ is up 4 cents for the day at 40.18- a day of sound and fury signifying (so far) very little- yet another weak doji rejection at the high. Link

Linda Piazza : 11/9/2005 2:27:39 PM

VIX still climbing off its low. Advdec line still dropping.

Jonathan Levinson : 11/9/2005 2:26:33 PM

Oh, you mean for this opex? I agree- if those levels get seen at all, they'd be a buy- with a tight stop, of course. If put writers start hedging on a sharp decline, then it could snowball lower... but there's certainly lots of support built up during the past 3 weeks, and only 7 trading days to opex.

Jonathan Levinson : 11/9/2005 2:22:05 PM

Marc, I think it'll take courage to buy 1610 after that overhang to 1623 lets go, but 1600 looks like good confluence and, of course, there are all those puts currently underwater waiting to get expired... Link

Linda Piazza : 11/9/2005 2:18:51 PM

The TRAN has just confirmed a lower high on its five-minute chart. It's now at 3999.07, certainly not low enough to have even begun to confirm the potential double-top formation on its 60-minute chart. There's massive price/RSI bearish divergence there on that 60-minute chart, but that's a warning only and not proof of an imminent rollover.

Jane Fox : 11/9/2005 2:18:07 PM

THe TRIN and the VIX are in sync today. Link

Jonathan Levinson : 11/9/2005 2:17:16 PM

Marc, I still show QQQQ put-to-call open interest evenly matched at 40 and put support at 39. The numbers favor resistance at 41, but they're much thinner over all than at 40, and my guess is for current op-ex forces to favor a close next week right around current prices. That can change in a heartbeat if the price actually gets free of this range, compounded by hedging and possible resetting of option positions, but currently, my guess would be for a close at the low end of 40.00-40.50.

Linda Piazza : 11/9/2005 2:16:38 PM

The VIX has been bouncing off the Keltner support I showed in my 12:49:57 post.

Jeff Bailey : 11/9/2005 2:15:04 PM

02:00 Internals found at this Link

Jane Fox : 11/9/2005 2:07:50 PM

I see Jeff posted a sell program at 1:54 but it was not a very strong one the TICKs never even made a new daily low.

Jonathan Levinson : 11/9/2005 2:06:16 PM

Session low for ten year notes at 107 57/64, TNX up 6.4 bps to 4.629%.

Jeff Bailey : 11/9/2005 2:05:01 PM

02:00 Market Watch found at this Link

Jonathan Levinson : 11/9/2005 1:55:09 PM

Sharp 100-tick drop here to test rising 72 SMA support just above the QQQQ pivot: Link

Jeff Bailey : 11/9/2005 1:54:18 PM

Sell Program Premium ... DIA $105.76, SPX 1,222.43, QQQQ $40.18

Jeff Bailey : 11/9/2005 1:52:59 PM

SOX.X 457.50 +1.15% ... bugger has pegged its DAILY R2 (459.27) at this point.

QQQQ $40.23 +0.22% ... DAILY R1 ($40.33) marks its current session high.

Jonathan Levinson : 11/9/2005 1:48:56 PM

QQQQ edges lower toward former resistance at 40.20. The decline is slower and on lighter volume then the pop which preceded it, and so the immediate thought is "corrective." But frankly, the price has been more chaotic than usual, and nothing would surprise me. I'm not inclined to buy support because of the toppy daily cycle, but I'm leery at resistance because of the weak/tractionless downphases and general upward tilt to this week's indecision. The light volume overall suggests that I'm not alone, as everyone waits for the others to take the next step. Link

Linda Piazza : 11/9/2005 1:48:55 PM

Reader Comment: I am now confused and a little irritated with your signals. YOU give the signals to enter and exit, and then when it's a loss (usually - making me think you were lying about the 25 winners in a row) you say it's not YOUR methodology. Are aliens making you exit for a loss? Be accountable! I take real losses....so tell me whose signals are they if they aren't your methodology. This is really bad and you need to take accountability. No one else does this stuff. OK, so buy GOOG at 100 and exit at 99.....the exit is not my methodology and my methodology is working well. See how this sounds really bad when GOOG trades 400. Be professional.

Response: Believe me, I understand your frustration, but let me clear something up first before I continue sympathizing. I don't lie about my trading record. It's backed up my trading account, and the SEC could come get me if I were making false claims. I don't know about you, but I don't want the SEC coming after me, and I'm not the kind of person to lie anyway. I'm the kind of person who will drive across town to return a pen when I get home and discover that I accidentally pocketed a retailer's pen after I wrote out my check. Second, I don't believe I claimed I had 25 winners in a row. I don't remember which day it was I made the how-many-trades-in-a-row I'd been profitable statement, but as of the end of October 21, during the October opex cycle, I'd had 18 profitable directional OEX trades in a row (not counting spreads), and out of 33 total trades directional OEX options trades (not counting spreads), I'd had only three losses, two of those just part of the commissions. Furthermore, in practicing these trades, I'd been sending them to another staff writer for months, so that I could get a feel for how they'd play out on the MM. When I was doing that, I could follow my methodology completely, however, and not have to base the stops on the OEX.

Second, I am accountable. Each day when I post these trades up there at the end of the day, I'm posting exactly what the trade did, showing losses when the official trade suffered a loss. That's up there in black and white for all to see. However, some have also asked that I post what I'm seeing and how I'd be trading it if not for those OEX-based stops, and that's what I'm doing. I asked if traders wanted me to just follow my methodology completely and say, "enter here" and "exit here," but the consensus was among replying readers was that they wanted me to go on doing it as I was. The tactic that you dislike and find irritating, others want.

I traded 33 times during the October opex cycle, but posting these trades and working out the logistics has resulted in far few trades for me personally this month. I'm personally sitting on a loss right now. I have been trading a lot less and a lot less profitably while I've been trying to work out these trades for the readers.

Here's the problem, as I explained ad nauseam when I first began posting these signals. For example, go to the archives and look at my 12:28:27 post on 10/20 and my 8:55:29 am post on 10/21. Those two posts detailed all the difficulties I foresaw, and I cautioned frequently during that period when I was first posting these trades. When I first began posting these trades, I noted then that it was going to be difficult to base trades on OEX price. I noted that my type of trades often suffered a big loss before they turned profitable and so that when a trade was ultimately stopped, the loss might be big. I said that I would never personally automatically take another trader's suggestions and that traders ought not to be taking my trades automatically but paper trading them for a while to see if they worked for them. I worried aloud at the time that traders would get stopped out by an OEX-based trade (which is happening) just before the markets turned around and the trade would have ultimately been profitable. So, I'm as frustrated as you are, because I'm doing this only to be helpful to other traders, wanting them to experience successful trading, too. I do not get paid extra for posting these trades, and my own account and trades have suffered because I cannot personally get in and out of trades as quickly and sometimes miss my own exits because I'm so worried about getting information posted for readers.

I'm not angry with your comments. We're all frustrated with this, but have you taken a look at the markets over the last week? The OEX has set up signal after signal with no follow-through any direction. We've traded these OEX signals less frequently than some might otherwise have traded the chop and have often taken at least partial profits before being stopped at the entry (I understand that means a loss in an options play, of course) or at another level. I'm doing my best to translate a system that was imminently workable into something for the site. At the end of the day, I'm posting each and every trade and the exits taken. I am not only accountable, but am personally losing money in this endeavor to bring the trades to you and spending nights worrying about how to make this workable on the MM.

Jeff Bailey : 11/9/2005 1:39:15 PM

Bullish swing trade exit alert ... for Yellow Roadway (YELL) $47.54 +0.04% here.

See near-term thoughts/analysis at 01:37:50.

Jeff Bailey : 11/9/2005 1:37:50 PM

Yellow Roadway (YELL) options chain with November strikes at this Link ... Some thoughts I ponder into Friday's expiration.

YELL is just sitting here last several days and right between $45-$50 strikes.

The BIGGEST RISK into next Friday's expire is the $45 Calls (OI 2,710) where some "manipulation" on a short-term basis to the downside, could juke out some of those gains currently found.

LOW OPEN INTEREST in the $50 Puts (43) gives options market maker little to worry about, should YELL fall back toward the $45 strike. There's few traders/investors with the $50 put.

A LOWER trade for YELL next week, could also benefit the options market maker in the Nov. $40 Calls.

With small gain for MM profiles, I think we should "cut out" here, look for pullback entry into $45 strike. Then allow November expire to pass, and get long again.

Jonathan Levinson : 11/9/2005 1:33:35 PM

QQQQ drifts sideways below its run-in with the 30/60 min channels and R1 resistance as the short cycles gather in overbought, starting to curl here. A break below the 40.15 pivot and 72 SMA will confirm the next downphase and shift the 30 min channel bias to the bear side. Link

Jonathan Levinson : 11/9/2005 1:24:54 PM

The bearish-D on the 60 min NQ/QQQQ chart is so steep that it could also qualify as a tractionless, corrective downphase- an extremely bullish possiblity if the bulls can regain the broken wedge support line and turn these cycles back up. However, they'll have to hold it. These are critical levels for bulls and bears, but I don't see the bulls as being home-free just yet. Link

Jeff Bailey : 11/9/2005 1:19:23 PM

Yellow Roadway (YELL) $47.58 +0.12% ... almost smack in the middle of $45-$50 strikes. For 5-days now!

Jeff Bailey : 11/9/2005 1:17:07 PM

Taser Intl. (TASR) $7.51 -2.84% ... pinned back to the $7.50 strike now.

Linda Piazza : 11/9/2005 1:16:12 PM

Back in a few minutes.

Jonathan Levinson : 11/9/2005 1:12:36 PM

Ten year notes dropped on the release of the auction results, TNX up 5.7 bps here at 4.625% and IRX up 2 bps at 3.882%.

Jeff Bailey : 11/9/2005 1:12:00 PM

01:00 Internals found at this Link

Linda Piazza : 11/9/2005 1:09:22 PM

I can understand the TRAN spiking higher if the Exxon official's statement was the reason, but what about the dollar and the financials? Is there something more, perhaps?

Jonathan Levinson : 11/9/2005 1:07:39 PM

Foreign central banks took a paltry 2.7B of the 13B in 5-year notes auctioned today. The bid to cover was a respectable 2.61 on the notes which sold for 4.525%.

Jane Fox : 11/9/2005 1:05:54 PM

This is not the kind of environment you want to try a short. Wait for confirmation unless you don't mind getting a lot of paper cuts that is. Link

Jeff Bailey : 11/9/2005 1:02:22 PM

01:00 Market Watch found at this Link

Linda Piazza : 11/9/2005 1:02:02 PM

Thanks, Marc. (See Marc's 12:54:56 post.)

Jeff Bailey : 11/9/2005 12:57:27 PM

Federated Dept. Stores (FD) $67.99 +6.35% Link ... bold move above its 200-day SMA today. Volume heavy.

Jonathan Levinson : 11/9/2005 12:56:24 PM

QQQQ has yet to regain the upper rising wedge trendline that broke this morning: Link

Linda Piazza : 11/9/2005 12:54:01 PM

I'm not seeing any news in my forex news source, either. The dollar spiked against the yen, too, whatever the news was.

Jane Fox : 11/9/2005 12:51:51 PM

TICKS +1000

Linda Piazza : 11/9/2005 12:50:52 PM

Advdec line still headed up.

Jane Fox : 11/9/2005 12:50:36 PM

TICKS +800

Jeff Bailey : 11/9/2005 12:49:17 PM

Dow Transports (TRAN) 4,006 +1.13% Link ... all-time highs here.

Linda Piazza : 11/9/2005 12:49:57 PM

If I had a clue what's going on here, I'd be watching this for a short opportunity. Here are a few charts that show why:
Bearish divergence and a way overdone move: Link
Another chart, the ten-minute, showing resistance again being approached and that same bearish divergence: Link
VIX chart, with VIX trying to hold to support: Link All this is coupled with the OEX testing the 200-sma and the TRAN, 4000.

Jonathan Levinson : 11/9/2005 12:47:19 PM

The pullback so far has been on declining volume despite the upper channel breaches and failure at R1. The 60 min cycle is in the process of reversing its downphase, early again, while the 30 min channel is in the first stages of a new upphase. Bears need to see a break back below 40.20 to suggest possible trouble for that 30 min cycle upturn. Link

Jeff Bailey : 11/9/2005 12:47:13 PM

Semiconductor Index (SOX.X) 457.88 +1.23% Link ... Breaks back above its trending lower 50-day SMA.

Jeff Bailey : 11/9/2005 12:43:45 PM

nq05z daily interval bar chart at this Link .. with Keene Little's DAILY Pivot Level table for today Link ... sellers should concede the highs.

Linda Piazza : 11/9/2005 12:41:27 PM

I honestly don't have a clue what precipitated this and I'm not going to make too many pronouncements until I do. Watch VIX. It hit 60-minute Keltner support and is trying to steady.

Jeff Bailey : 11/9/2005 12:39:30 PM

QQQQ $40.29 +0.37% ... looks DAILY R2 at $40.52.

Linda Piazza : 11/9/2005 12:39:18 PM

Danger, bulls. The TRAN is testing the 4000 level again, at 4001.77, the level from which it saw a sharp pullback on Thursday. Even the fast-moving RSI shows bearish price/RSI divergence on the 60-minute chart. That's no guarantee of anything except that you're being warned to pay attention and to follow stops higher. This true if long the OEX, SPX, Dow or specific transportation stocks.

Jeff Bailey : 11/9/2005 12:38:22 PM

Intel (INTC) $24.80 +1.01% Link ... sets up for test of its starting to turn higher 200-day SMA.

Bank of America (BAC) $44.68 +0.65% Link ... holding gains and its 200-day SMA (QCharts being tested today at $44.65).

Jonathan Levinson : 11/9/2005 12:38:20 PM

Volume breadth is up to +2.44:1 on the NYSE, +1.5:1 on the Nasdaq.

Linda Piazza : 11/9/2005 12:32:34 PM

The OEX tested 564.93 resistance on the 60-minute chart. As Mark just mentioned on the Futures side, perhaps with respect to the MACD in his case, this is producing massive bearish price/RSI divergences on the 60-minute chart.

Jonathan Levinson : 11/9/2005 12:32:16 PM

Following Linda's comments, the current move has broken upper 30 and 60 min channel resistance on QQQQ, failing for the moment at R1. These channel violations are generally viable sell signals, except in the strongest trending moves. Price needs to fall quickly to support a bearish interpretation. Link

Linda Piazza : 11/9/2005 12:30:54 PM

VIX hit potential support.

Jeff Bailey : 11/9/2005 12:31:11 PM

Stillwater Mining (SWC) $10.08 +3.81% Link ... impressive after gap low on "weak" earnings reaction on Monday. Very econ sensitive stock here.

Jane Fox : 11/9/2005 12:28:21 PM

When AD volume started to climb and make new daily highs I started to get bullish but that has happened so many times in the past and the new highs did not hold. This time I think they will. Link

Linda Piazza : 11/9/2005 12:28:24 PM

This movement is WAAAY overdone on the advdec line's five-minute chart and it's showing bearish value/RSI divergence with the earliest spike this morning. There should be a pullback in the advdec line, but how deep and whether the OEX will pull back with it this time are yet unsure. Advdec line still climbing currently, so it's also unsure when the pullback will occur.

Jeff Bailey : 11/9/2005 12:28:06 PM

NYSE Comp (NYA.X) 7,522.84 +0.44% Link ... bold move higher here. Challenges Monday's high.

Linda Piazza : 11/9/2005 12:26:03 PM

The OEX is at the 200-sma at 564.70, with the OEX currently at 564.82.

Jane Fox : 11/9/2005 12:25:56 PM

TICKS again to +1000

Linda Piazza : 11/9/2005 12:25:18 PM

Where did that come from? I, like some others, have not seen any news, but I'm glad I warned a few minutes ago that those following my methodology might just go ahead and exit, because I'm not sure what's going on here.

Jonathan Levinson : 11/9/2005 12:22:46 PM

Volume breadth is up to +2.3:1 on the NYSE, +1.5:1 on the Nasdaq.

Jane Fox : 11/9/2005 12:22:20 PM

I posted earlier that system I was backtesting provided the best results from 12:00 to 1:00 EST and this little rally is definitely proving this to be true.

Jeff Bailey : 11/9/2005 12:24:25 PM

Swing trade long 1/2 position alert ... for the Chicago Board of Trade (BOT) $118.50 +1.36% Link here, stop $110, target $132.

Disclosure: I currently hold bullish positions in BOT.

Jeff Bailey : 11/9/2005 12:20:56 PM

Linear Tech (LLTC) $33.88 +0.77% ... after session low of $33.49.

Jonathan Levinson : 11/9/2005 12:20:51 PM

Nothing that I see yet.

Jonathan Levinson : 11/9/2005 12:20:35 PM

QQQQ breaks descending resistance connecting yesterday's and today's highs: Link

Jane Fox : 11/9/2005 12:20:33 PM

TICKS +1000 they're backkkkk.

Linda Piazza : 11/9/2005 12:20:07 PM

OEX Keltner picture: I'm not even looking at a 15-minute chart any longer, but the five-minute one because the OEX has mostly been bounding by resistance and support found there. Next resistance currently at 563.03 on a five-minute closing basis (but likely to be nudged a little higher on this OEX spike) with next resistance at 564-564.48.

Jeff Bailey : 11/9/2005 12:19:46 PM

VIX.X 12.87 -1.60% ... session low. Edges below DAILY S1

Jonathan Levinson : 11/9/2005 12:13:58 PM

The Qs are trading extremely light volme, 27.1M shares so far, just over 1/4 of their average daily volume. This matches the price action so far, an inside day within yesterday's range.

Jeff Bailey : 11/9/2005 12:13:48 PM

12:00 Internals found at this Link

Linda Piazza : 11/9/2005 12:13:21 PM

OEX Trade Signals
We're officially stopped out of our play, but I promised to let readers know how the play is proceeding according to my methodology. The advdec line is not following through on weakness as I would like. Right now, it's risen to test resistance again, and this could be setting up as a repeat of yesterday's action, so some might elect to just exit, especially if there's another dip toward or below 561.50 that doesn't just plow straight down through it. The play has not been stopped according to my methodology, but I don't like the way it's behaving, either. Next advdec line resistance is at about +100 to +440, with the advdec line now at 49, QCharts value.

Jonathan Levinson : 11/9/2005 12:08:58 PM

Session high for gold at 467.20, and crude oil at 60.425.

Jonathan Levinson : 11/9/2005 12:07:44 PM

The mortgage interest deduction has been an incredible gift to the real estate market. Here in Canada, where the highest marginal tax bracket on personal income is above 50% (52%?), and mortgage interest is not deductible, homeowners shoulder a great burden. Combined with property taxes, insurance, heating and AC, rentals are a very compelling alternative.

Jeff Bailey : 11/9/2005 12:02:47 PM

12:00 Market Watch found at this Link

Jane Fox : 11/9/2005 11:59:57 AM

This is actually getting funny but the AD volume is climbing again and back above 0.

Linda Piazza : 11/9/2005 12:08:55 PM

Take a look at the OEX's 15-minute chart. Since the afternoon of November 4, the OEX has traded in a tight range, with one blip higher on Monday, soon reversed. Signals set up, but don't pan out.

Jonathan Levinson : 11/9/2005 11:57:35 AM

A big spike in the SOX just now, failing below yesterday's high and pilling back from below 455. It will take a mov below the 451.50-452 72 SMA/pivot confluence to reverse the young short cycle upphase, however. Link

Jonathan Levinson : 11/9/2005 11:48:52 AM

Headlines:

11:45am U.S., JAPAN, EU SHOULD PRESS CHINA ON COPYRIGHTS, GROUP SAYS

11:45am GROUP SAYS U.S. SHOULD TAKE CHINA TO WTO OVER CURRENCY

11:45am CONGRESS SHOULD MULL TARIFFS ON CHINESE IMPORTS, GROUP SAYS

11:45am CONGRESSIONAL GROUP FINDS U.S.-CHINA RELATIONS NEGATIVE

WMT holds a .36 gain at 47.97 here.

Jonathan Levinson : 11/9/2005 11:43:54 AM

Crude oil is up to a 25 cent gain at 59.95, bouncing off a 58.65 low, clearing yesterday's high. Link

Jonathan Levinson : 11/9/2005 11:40:24 AM

Headlines:

GERMANY'S DAX ENDS LITTLE CHANGED AT 5,011

FRANCE'S CAC-40 SHEDS 0.5% TO 4,480 AS TRADING ENDS

U.K.'S FTSE 100 DOWN 0.4% AT 5,439

Jonathan Levinson : 11/9/2005 11:37:45 AM

Session high for Dec. gold back at 466 resistance, +3.70. My daily chart is lagging, but here's the daily picture: Link

Jane Fox : 11/9/2005 11:34:06 AM

Bulls beware because the AD volume is now once again below 0 and making new daily lows. I think as long as you follow the AD volume in the context of the AD line you will be OK today.

Linda Piazza : 11/9/2005 11:31:50 AM

The advdec line hasn't been able to bounce much, and I'm now waiting to see if it breaks through support near -800, with the advdec line now at -740, QCharts value.

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

Ten year notes are weaker, now trading below 108, as TNX holds a 5.7 bp gain at 4.622%. IRX is up 2 bps at 3.882%. I will report the results of the 5 year note auction at 1PM.

Linda Piazza : 11/9/2005 11:23:23 AM

The advdec line is bouncing from the support I named earlier, although not in a big bounce yet. The OEX bounces more heartily. It's broken to the upside and downside out of that nicely defined triangle from yesterday so often that the triangle is rendered useless for its predictive properties. The OEX is still spiking up to and slightly above the descending trendline off the 9/09 high, but not able to close even a 15-minute period above it after doing so on Monday for a few 15-minute periods.

Jeff Bailey : 11/9/2005 11:15:15 AM

11:00 Internals found at this Link

Linda Piazza : 11/9/2005 11:12:22 AM

I agree with Jane's assessment in her 11:06:22 post. I've seen some stellar setups just not perform well lately, so be careful with your positions and perhaps limit your position size until you see that a play is working.

As for the advdec line, it's dipping into that support zone I mentioned in my 11:07:48 post. Unless there's a strong push through it, it might bounce the advdec line again, but the resistance has been holding so far when tested.

Linda Piazza : 11/9/2005 11:07:48 AM

OEX Trade Signals
As a reminder, our official play is stopped out (fiddly sticks), but I have told people that I will let them know how my methodology is working. So far, it's working fine. The play would not have been stopped, and the advdec line has rolled down again, about to test the day's low, but already below the Keltner line that supported it on the first bounce. It's dropping into another level that can bounce it, at about -750 to -720, but this came close to giving a new bearish signal, so all is well so far. If it had given a new bearish signal (bearish value/RSI divergence), I would have issued a new official bearish entry, but it didn't.

Jane Fox : 11/9/2005 11:07:46 AM

TICKS range so far today is a non directional 697 to -628

Jonathan Levinson : 11/9/2005 11:06:32 AM

Headlines:

11:02am GM GENERAL MOTORS DOWN ALMOST 4% AT $24.88

11:04am GM GENERAL MOTORS HITS 13-YR. LOW OF $24.65 IN INTRADAY TRADE

Jeff Bailey : 11/9/2005 11:03:06 AM

11:00 Market Watch found at this Link

Jonathan Levinson : 11/9/2005 11:01:49 AM

Volume breadth flips back to neutral-negative, -1.01:1 on the NYSE and -1.3:1 on the Nasdaq. QQQQ's failure below the broken rising trendline is bearish, and the short cycle upphase has been very weak and corrective, getting zero traction. Yesterday's lows haven't been tested at 39.99, but a break of the 40.03 today low is within spitting distance, and the price action, while neutral so far today, is not bullish. Yesterday's high has not yet been approached. Link

Linda Piazza : 11/9/2005 11:01:41 AM

The advdec line is dropping below the support that held it up earlier today.

Linda Piazza : 11/9/2005 10:57:13 AM

I think professionals were unloading some supply during the previous 15-minute period. The SPY closed well off its high during that period, with volume high as compared to previous periods.

Jeff Bailey : 11/9/2005 10:57:04 AM

Distillate 0-15 ppm Sulfer (diesel) inventories rose by 105,000 barrels, or 8.25% to 1.37 million barrels.

Jeff Bailey : 11/9/2005 10:54:51 AM

Jet Fuel Inventories rose by 2 million barrels, or 5.46% to 38.6 million barrels.

Jeff Bailey : 11/9/2005 10:54:03 AM

EIA Weekly Crude Oil, Unleaded Gas, Distillate Table found at this Link

Jonathan Levinson : 11/9/2005 10:51:48 AM

Session low for ten year notes at 108, TNX up 4.7 bps to 4.612%.

Linda Piazza : 11/9/2005 10:48:37 AM

OEX Trade Signals
As a reminder, our play is officially stopped. This kind of action post-inventories is why we're having problems integrating my trading style in the Market Monitor. The advdec line never gave me a signal to exit. The advdec line was just moseying along, retesting former support to see if it was holding as resistance, the expected thing for it to do. And, so far, that resistance has held, even if it's a tentative hold right now. There's the danger that the advdec line could just hug that resistance line all day, kind of twining along it while the OEX continued to climb, but so far, it's holding. The strongest resistance now is near 350, with the advdec line at -10 as I type, QCharts value.

Jonathan Levinson : 11/9/2005 10:47:07 AM

Volume breadth is just above neutral, +1.1:1 on the NYSE, +1.2:1 on the Nasdaq.

Jane Fox : 11/9/2005 10:46:49 AM

Here is how the SPX is trading compared to the VIX. The SPX spike higher was confirmed by the VIX spike lower. Link

Jeff Bailey : 11/9/2005 10:42:33 AM

EIA Weekly Inputs, Operable Capacity, Capacity Utilization Table found at this Link ... 84% of the nations refinery capacity now online. The U.S. added 4,000 barrels per day of operable capacity, which is first add since June 2005.

Jonathan Levinson : 11/9/2005 10:39:38 AM

QQQQ races back to the broken trendline at 40.21, rising support not tested at 40.23. Price is pulling back, but with a new short cycle upphase just starting, there's a decent chance of a retest. Link

Linda Piazza : 11/9/2005 10:38:06 AM

OEX Exit Alert
OEX bearish options trade entered at 561.58. Stopped at 562.70.

It would not yet be stopped by my methodology, but could be, at a much higher price. I'll update you as the day goes along, but you're risking that stopping out at a higher price.

Jane Fox : 11/9/2005 10:37:43 AM

THe bulls are getting stronger both AD volume and AD line are now above 0 and making new daily highs.

Jeff Bailey : 11/9/2005 10:36:56 AM

Bank of America (BAC) $44.65 +0.58% ... Testing its 200-day SMA alert!

Linda Piazza : 11/9/2005 10:36:34 AM

OEX Exit Alert
We're likely about to be stopped--we were just stopped. My methodology is not stopping us out yet, so if you want to risk it, you can hang on and I'll tell you when that happens, too, but it might happen at a higher price.

Linda Piazza : 11/9/2005 10:34:32 AM

OEX Trade Signals
The OEX is not behaving well, but the advdec line is, so far. It's just testing former support to see if it holds now as resistance. So far, it is.

Jonathan Levinson : 11/9/2005 10:31:54 AM

Headlines:

U.S. DISTILLATE STKS DOWN 100,000 BRLS: ENERGY DEPT

U.S. GASOLINE STKS UP 4.2 MLN BRLS: ENERGY DEPT

U.S. CRUDE STKS UP 4.5 MLN BRLS LAST WK: ENERGY DEPT

Jonathan Levinson : 11/9/2005 10:31:23 AM

QQQQ returns to the 72 SMA at the 40.15 pivot: Link

Jonathan Levinson : 11/9/2005 10:30:49 AM

A bounce in equity futures as crude oil drops to a low of 59.025.

Jonathan Levinson : 11/9/2005 10:30:12 AM

From the EIA website:

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) rose by 4.5 million barrels from the previous week. At 323.6 million barrels, U.S. crude oil inventories remain well above the upper end of the average range for this time of year. Total motor gasoline inventories increased by 4.2 million barrels last week, putting them in the upper half of the average range. Distillate fuel inventories inched lower by 0.1 million barrels last week, and are at the lower end of the average range for this time of year. A decline in high-sulfur (heating oil) distillate fuel more than compensated for an increase in low-sulfur (diesel fuel) distillate fuel. Total commercial petroleum inventories increased by 11.6 million barrels last week, and are near the upper end of the average range for this time of year.

Linda Piazza : 11/9/2005 10:29:56 AM

Reader Question: How do you get quotes for the advdec lines and volume? I can't seem to find a ticker symbol that gives me those numbers. Also, who decides how to draw trendlines? It seems like they can be drawn to mean anything someone wants it to mean. I mean, I thought they were drawn to touch the lowest spikes or dips, but then sometimes they go right through spikes or dips (or the spikes or dips violate the trend?), but how do you know how to draw them?

Response: Great questions, and I thought I would answer them here on the Market Monitor since other people might have the same questions. I use QCharts, and the symbols are "advdec" and "advdecv." Not all charting services offer this information, and so you might not be able to find it on your charting service.

As to the question about trendlines, I'm not using trendlines. I'm using Keltner channels combined with RSI to decide on support and resistance. For an article that describes how I use the advdec line, check the Traders Corner article here Link . You might also go the Market Monitor archives (use the pull-down menu under "Tools") and check yesterday's 10:00:45 post for a chart that shows what I was watching at that time. I hope this helps.

Linda Piazza : 11/9/2005 10:28:08 AM

OEX Exit Alert
So far, the OEX and advdec line retest of broken support have both resulted in that support holding as resistance. We need more to happen, of course, in the form of more OEX downside. Decide now if you want to hold over the inventories number. I'm keeping the play open.

Jeff Bailey : 11/9/2005 10:25:32 AM

Swing trade naked call close out alert ... for the Chesapeake Energy CHK Nov. $35 Calls (CHK-KG) at the offer of $0.05.

CHK $28.37 -0.87% ...

Jeff Bailey : 11/9/2005 10:24:21 AM

Swing trade covered call close out alert ... for the Wellpoint Health WLP Nov $80 Calls (WLP-KP) at the offer of $0.05.

WLP $72.31 +0.04% here.

Jonathan Levinson : 11/9/2005 10:19:23 AM

Session low for crude oil here, -.35 at 59.35. Awaiting the Petrol Report in 11 minutes.

Linda Piazza : 11/9/2005 10:16:32 AM

Bulls haven't given up yet. Although nothing alarming is happening yet with the advdec line, just the expected climb back to test broken support, the OEX is also bouncing to test broken support. The OEX is looking as if it might break back into that triangle again. Bears would like to see the OEX continue to find resistance at the five-minute 21-ema at 561.58, as it has all day, or, failing that, at the five-minute 100-ema at 561.83.

Jeff Bailey : 11/9/2005 10:20:19 AM

10:00 Internals found at this Link

Yesterday's Internals found at this Link

Jonathan Levinson : 11/9/2005 10:10:27 AM

For QQQQ, that broken rising wedge support line is at 40.20: Link

Jonathan Levinson : 11/9/2005 10:05:44 AM

QQQQ tests rising support connecting this week's lows: Link

Jeff Bailey : 11/9/2005 10:03:25 AM

10:00 Market Watch found at this Link

Linda Piazza : 11/9/2005 10:04:04 AM

New low of the day (LOD) for the OEX. Yesterday's low was 560.75, and we need to see the OEX drop strongly below that. I'd expect a bounce attempt from somewhere near here, however, as the OEX tests important moving averages. By the way, the advdec line setup is nothing like yesterday's as this level was being tested, and is not extended to the downside. RSI has only begun to roll over on some time frames, and may in fact still need another bounce with bearish divergence.

Jonathan Levinson : 11/9/2005 10:01:32 AM

YM loses yesterday's low from a lower high, QQQQ still 6 cents above yesterday's low.

Linda Piazza : 11/9/2005 10:01:09 AM

There could be a bounce in the advdec line. That's natural to see, but we hope now that any bounce keeps it below resistance now at about -150 up to about +50. Advdec line beginning a tepid bounce as I type, now at -590. We also hope that any bounce, if it does occur, doesn't bounce the OEX far.

Jonathan Levinson : 11/9/2005 10:01:05 AM

Headlines:

U.S. SEPT. WHOLESALE INVENTORIES RISE 0.6% VS. 0.4% EXPECTED

U.S. SEPT. WHOLESALE SALES UP 2.4%

U.S. SEPT. WHOLESALE PETROLEUM INVENTORIES UP 3.8%

U.S. SEPT. WHOLESALE INVENTORY-SALES RATIO FALLS TO 1.15

U.S. SEPT. NONDURABLE INVENTORY-SALES RATIO RECORD LOW 0.84

Jonathan Levinson : 11/9/2005 10:01:03 AM

Headlines:

U.S. SEPT. WHOLESALE INVENTORIES RISE 0.6% VS. 0.4% EXPECTED

U.S. SEPT. WHOLESALE SALES UP 2.4%

U.S. SEPT. WHOLESALE PETROLEUM INVENTORIES UP 3.8%

U.S. SEPT. WHOLESALE INVENTORY-SALES RATIO FALLS TO 1.15

U.S. SEPT. NONDURABLE INVENTORY-SALES RATIO RECORD LOW 0.84

Linda Piazza : 11/9/2005 9:59:05 AM

OEX Trade Signals
Advdec line dropping nicely (for a bearish play), now hitting support again, but below other key support. I wish that the OEX's drop had been deeper, however, with the OEX now touching the 15-minute 100-ema. Feel free to take profits at any time they're offered. Remember that you need to have high-delta options to make these plays work well.

Jonathan Levinson : 11/9/2005 9:54:26 AM

The Fed announces an overnight repo of 3.5B against no expirations, for a net add in that amount for the day.

Linda Piazza : 11/9/2005 9:51:36 AM

OEX Trade Signals
The OEX keeps punching below that triangle with support formed from a rising trendline off the 11/4 low, but we wish it would stay below that trendline and reach a new low of the day. It's currently rising again retesting that trendline, back slightly inside the triangle again. The advdec line is dropping comfortably for our play, but is now at a support zone, and could bounce and bounce the OEX, too.

Jane Fox : 11/9/2005 9:49:29 AM

VIX is rising confirming the new daily lows in SPX.

Jane Fox : 11/9/2005 9:48:34 AM

AD volume and AD line are falling, are below 0 and are making new daily lows.

Linda Piazza : 11/9/2005 9:47:10 AM

For those not able to view a television, the hearings on Oil Pricing and Profits have begun and are being televised on CNBC.

Linda Piazza : 11/9/2005 9:45:11 AM

Advdec line pulling back, but bears would like a deeper pullback.

Jeff Bailey : 11/9/2005 9:44:43 AM

Bullish swing trade stop alert for the 1/2 position in shares of Linear Tech (LLTC) $33.60 -0.17% ...

Jonathan Levinson : 11/9/2005 9:42:47 AM

Awaiting Wholesale Inventories at 10AM, est. 3%. The Fed has no expiring repos for today, so any amounts added before 10AM will be net adds and supportive to the markets.

Linda Piazza : 11/9/2005 9:41:15 AM

The TRAN is dropping.

Jonathan Levinson : 11/9/2005 9:41:12 AM

Session low for ten year notes, TNX up up to a 3.5 bp gain at 4.6%. 13-week bill rates are up 1.5 bps at 3.877%.

Linda Piazza : 11/9/2005 9:40:04 AM

OEX Entry Point Alert
OEX options bearish play entered when OEX at 561.58. Stop 562.70.

Linda Piazza : 11/9/2005 9:38:51 AM

OEX Entry Point Alert
Advdec line move extreme, and there should be a pullback at least, perhaps after some more attempts at 562. Enter a bearish OEX options trade now. Stop when the OEX is at 562.70. If I don't see it set up further, I'll pull the plug soon.

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

Volume breadth goes positive, +1.6:1 on the NYSE, +1.2:1 on the Nasdaq. QQQQ continues to hold below the declining 72 SMA at 40.17, below which the 30 min channel maintains a negative bias: Link

Jane Fox : 11/9/2005 9:34:14 AM

Both AD line and AD volume are above 0 but barely.

Linda Piazza : 11/9/2005 9:33:25 AM

The OEX has broken below the rising trendline that's been describing the bottom of its triangle, but the advdec line is holding support, so that mixed picture is keeping me from suggesting a bearish play just now, and I see the OEX bouncing back to test the triangle as I type. The advdec line is in a peculiar place, just above support on some charts, but facing resistance on others, and I'm watching to see which way it heads. We may have just seen a false breakout, but that remains to be seen.

Jonathan Levinson : 11/9/2005 9:32:04 AM

Volume breadth is +1.13:1 on the NYSE, -1.12:1 on the Nasdaq at the open.

Linda Piazza : 11/9/2005 9:31:02 AM

Mixed picture. Advdec line opens above support, but OEX edges beneath that triangle's trendline. Watching to see what the advdec line does.

Jeff Bailey : 11/9/2005 9:30:17 AM

Estee Lauder (EL) $32.90 ... 3.8 million shares blocked at $32.40 in pre-market.

Jonathan Levinson : 11/9/2005 9:20:57 AM

Crude oil is -.25 at 59.45 here, natgas +.01 at 11.805. Session low has been 59.35 for oil, 11.66 for natgas.

Jane Fox : 11/9/2005 9:20:29 AM

Dateline WSJ Democrats retained New Jersey and Virginia governorships, deepening Republican angst over the toll of Bush's problems. Corzine defeated Forrester after a bruising New Jersey campaign, while Kaine took Virginia despite a last-minute Bush appeal.

Jonathan Levinson : 11/9/2005 8:58:47 AM

As noted yesterday, QQQQ remains in an ambiguous cycle setup, and the price action has been sideways-up for a week. There's no indication of a breakout move in either direction on the basis of price cycles, with the 30 min cycle pointing down, the 60 pointing tentatively up, the daily tentatively topping. There are negative divergences and a bear wedge on the 30 and 60 min charts, but the past week in particular has seen an astounding number of failed signals and setups, and so far, instead of bulls or bears, the "flats" have been winning an increasing number of those battles.

Jane Fox : 11/9/2005 8:54:30 AM

DAteline WSJ As executives from five big oil companies get set to take the hot seat today in a congressional probe into "price gouging" in the wake of Hurricane Katrina, policy makers are trying to determine just what "gouging" means -- and how they should distinguish between rapacious pricing and normal market behavior after supply disruptions.

Over the years, federal investigators have regularly looked into complaints about gas prices and never brought a charge. "In almost every case we find legitimate business reasons" for price increases, including pipeline breaks or refinery outages, says John Seesel, associate general counsel for energy for the Federal Trade Commission.

Some critics say the problem is that the current federal law isn't tough enough. There's no national ban on "gouging" per se. The FTC instead looks for signs of price collusion and "anticompetitive" practices in gasoline markets. "Despite a great deal of intense scrutiny, I don't believe we've found those kinds of situations," says Mr. Seesel...

Executives from Chevron Corp., Exxon Mobil Corp., ConocoPhillips, Royal Dutch Shell PLC's Shell Oil, and BP America Inc., BP PLC's U.S. subsidiary, are expected to testify today at the Senate hearing.

Linda Piazza : 11/9/2005 8:50:10 AM

Yesterday, the OEX ended the day inside a large triangle that formed on its 15-minute chart, with that triangle forming beneath the rising trendline off the April low, a long-term trendline, and the descending trendline off the September 9 high. As the day ended yesterday, the top of that triangle was at about 562.50 and the bottom support at about 561.40. As the triangle began forming, it was about 3.40 points wide, so a breakout either direction, if sustained, should be good for a 3.40-point move according to standard technical analysis. The "if sustained" part is the catch, because we may see a false breakout or two.

The OEX still found resistance at those two trendlines. On the daily chart, it's finding support above the 100/130-ema's, historical support near 561.23 and the daily 72-ema and 50-sma's, all located in a right range from the OEX's close down to 559.54. As long as the OEX is finding resistance below those trendlines, our first assumption should probably be that it's likely to continue doing so, but we'll be watching for a breakout either direction, with internals that match a move in that direction, as a signal for either a bearish or long options play on the OEX.

Jonathan Levinson : 11/9/2005 8:42:14 AM

Session highs for gold and silver, Dec. gold +2.2 to 464.5. Updated daily chart at this Link

Jonathan Levinson : 11/9/2005 8:31:15 AM

Bonds have edged lower/yields up this morning, with the ten year yield (TNX) up .7 bps at 4.572%, 13 week yield (IRX) up 1 bp at 3.872%.

Jonathan Levinson : 11/9/2005 7:29:56 AM

From the MBA's website:

WASHINGTON, D.C. (November 9, 2005) - The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 4. The Market Composite Index - a measure of mortgage loan application volume - was 661.3, an increase of 2.3 percent on a seasonally adjusted basis from 646.7, one week earlier. On an unadjusted basis, the Index increased 1.0 percent compared with the previous week but was down 9.2 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index increased by 6.4 percent to 465.7 from 437.6 the previous week whereas the Refinance Index decreased by 3.4 percent to 1798.8 from 1862.8 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which increased 2.4 percent to 988.2 from 965.1 the previous week, and the Government Index, which increased 0.3 percent to 115.6 from 115.2 the previous week.

"Last week, home purchase applications dropped below their 2004 level for the first time in six months," said Jay Brinkmann, MBA's Vice President of Research and Economics. "Despite a 6.4 percent increase over the previous week, home purchase applications remain 3.6 percent below their level in early November, 2004."

The four week moving average for the seasonally-adjusted Market Index is down 1.2 percent to 681.2 from 689.5. The four week moving average is down 0.2 percent to 468.4 from 469.4 for the Purchase Index while this average is down 2.6 percent to 1918.5 from 1970.1 for the Refinance Index.

The refinance share of mortgage activity decreased to 41.7 percent of total applications from 43.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 31.6 percent of total applications from 29.4 percent the previous week.

Jonathan Levinson : 11/9/2005 7:24:02 AM

Equities are flat, ES trading 1222.75, NQ 1637.5, YM 10570 and QQQQ +.04 at 40.18. Gold is up 1.2 at 463.5, silver +.045 at 7.67, ten year notes -1/64 at 108 19/64, crude oil -.10 at 59.60 and natgas -.035 at 11.76.

We await the 10AM release of Wholesale Inventories, est. +.3%, and at 10:30, the weekly Petroleum Report.

Linda Piazza : 11/9/2005 6:57:20 AM

Good morning. The Nikkei climbed last night, but other Asian markets were mixed, as are European markets this morning. As of 6:47 EST, gold was higher by $1.20 to $463.50, and crude, higher by $0.04 to $59.75. More details about Asian and European markets follows in succeeding paragraphs.

Wednesday morning, the Nikkei opened below that 13,980 support level that had been holding for the previous three trading days. Goldman Sachs had cut its rating of Mizuho Financial Group to an under-perform rating and said that the banking sector's stocks already had priced in the economic growth. Banks headed lower. Sumitomo Metal Industries disappointed, falling. JFE Holdings saw profit-taking after recent gains. Toyota Motor Corp. declined after reporting a recall yesterday.

Tokyo Electron did gain ahead of its earnings report later in the day, however, with that report showing a strong increase in first-half profit and sales. Advantest also gained in early trading. The October Current Economic Diffusion Index fell to 50.7 from the previous 51.7, but did stay above 50. The Nikkei spent about an hour testing 13,950 and then began climbing, hitting a new four-year high. It fell off that high, but managed a positive close. It closed higher by 35.47 points or 0.25%, at 14,072.20.

Other Asian markets were mixed, but a Marketwatch.com article noted that technology stocks generally performed well after Samsung announced a plan to spend $45 billion in five years on research and development. The Taiwan Weighted gained 2.08%, but South Korea's Kospi rose a more modest 0.07%. Singapore's Straits Times fell 0.07%, but Hong Kong's Hang Seng climbed 1.35%. China's Shanghai Composite dropped 0.18%. Last night, the central bank said it would keep monetary policy steady.

European markets are mixed, too. Yesterday, the Nationwide October Consumer Confidence number for the UK had been the weakest since the survey began. Today, the UK's September trade figures met expectations by narrowing slightly, although August's already widened figure was revised higher. Net trade is not expected to contribute much to GDP growth. EADS, European defense company and parent of Airbus, raised its forecast. However, it didn't comment on next year and the raised earnings outlook didn't meet expectations or whisper numbers, and that company's stock declined heavily. Deutsche Telekom's shares declined after the company's forecast was lowered. French advertising group Havas forecast a slowdown in the fourth quarter. Steelmaker Mittal Steel Co. fell after its earnings report showed the deleterious effect of higher costs for its materials and lower prices for its products. Germany's Bayer climbed after its strong earnings report.

As of 6:47 EST, the FTSE 100 was lower by 8.60 points or 0.16%, at 5,452.30. The CAC 40 was lower by 10.95 points or 0.24%, at 4,492.67. The DAX was higher by 9.58 points or 0.19%, at 5,018.41.

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