Option Investor
Archive
HAVING TROUBLE PRINTING?
Printer friendly version
OI Technical Staff : 11/21/2005 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The Market Monitor has been archived.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.

Linda Piazza : 11/21/2005 4:02:18 PM

OEX/SPX/SPY Option Trade Recap for 11/21/05
First OEX bearish entry made at 574.50. Exit at 575.64, for a 1.14 point move against the position.

Second OEX bearish entry at OEX 575.58. Took partial profit at 574.75. Exited rest of play at 575.82.


Jane Fox : 11/21/2005 3:59:14 PM

Marc my TS has a NQ friday high at 1695. Go figure heh?

Jane Fox : 11/21/2005 3:58:20 PM

Mark you are right but NQ did make a new 52 week high on Friday.

Linda Piazza : 11/21/2005 3:58:05 PM

I have so many rising trendlines on the TRAN's intraday charts. All day, it kept breaking through one after the other, then this zoom. As I said this morning, it's all about the TRAN to some degree. The BIX played its part today, too, however, as did the RLX.

Jane Fox : 11/21/2005 3:56:58 PM

TRAN to a new 52 week high.

Jane Fox : 11/21/2005 3:56:20 PM

SPX to a new 52 week high.

Jane Fox : 11/21/2005 3:55:35 PM

NDX to a new 52 week high.

Linda Piazza : 11/21/2005 3:54:52 PM

If you read my early morning update on the OEX, in my 8:31:44 post, you know that I was advising then that anyone not wanting just a scalping play wait for a push up to 577-578 and then look for a potential rollover play. My pre-market judgment is usually less clouded than the in-the-heat-of-the-day judgment but it still included the admonition to look for a rollover. There hasn't been one yet. If the OEX had hit this early in the morning, I'd have known what to do about it--first thing, I would have riden it higher, but it wasn't showing signs that it would hit the higher level earlier in the day and it didn't. Right now, I'm as stunned as the rest of you.

Jane Fox : 11/21/2005 3:54:43 PM

COMPX to a new 52 week high.

Jane Fox : 11/21/2005 3:53:26 PM

Wilshire 5000 to a new 52 week high.

Jane Fox : 11/21/2005 3:50:55 PM

You can't read this anyway but bullish. Link

Jonathan Levinson : 11/21/2005 3:45:17 PM

The 30 and 60 min cycles for QQQQ have turned up in unison, both now on buy signals, the 60 min from oversold territory. This setup could run for potentially hours more, though the maxxed out trending daily cycle is a potential problem for the bulls. The bears completely fumbled what should have been a much deeper pullback, and while the base appears weak, short covering appears to be providing ample fuel for the move. Link While the upside channel break is often a timely sell signal, the fact that the 30 and 60 min cycles are just now turning up is going to keep me on the sidelines.

Jane Fox : 11/21/2005 3:43:37 PM

This snuck up on us didn't it? Link

Linda Piazza : 11/21/2005 3:42:42 PM

Glad now that I exited that second bearish OEX play. As Mark said a few minutes ago, this stinks to high heaven.

Here's a messy but long-term chart I've had on the OEX, and it shows the OEX rising up into a long-term horizontal s/r band I've had marked on my chart for years. Don't even remember why it's there except that it tends to be a zone of swing highs or swing lows. I had so hoped that the OEX would rise up this morning and test that, and we could ride it up. I'd fully intended to go long if the parameters set up right. Then they didn't and everything set up for a pullback. No follow-through there, and now the OEX is back to the zone from which I'd intended to look for a potential rollover play. Link Look at this. It is NOT common for the OEX to outstrip its 10-sma this far.

Jonathan Levinson : 11/21/2005 3:42:02 PM

Volume breadth rises to +2.15:1 on the NYSE, +1.9:1 on the Nasdaq.

Jane Fox : 11/21/2005 3:40:46 PM

TICKS +1000

Jonathan Levinson : 11/21/2005 3:37:06 PM

Session highs. Looks like the Fed's 5.5B net add and the coupon pass deliverable today have found a purpose.

Jonathan Levinson : 11/21/2005 3:35:01 PM

QQQQ - Exit Point Alert -

Stopped Out QQQQ at 41.49, breakeven

Linda Piazza : 11/21/2005 3:34:10 PM

The previous high of the day for the TRAN was 4155.17, with the TRAN currently at 4153.33. Is it still headed here? Link It's looking fairly extended to me, so I'm not sure, but I'd be limiting my long positions after it hits that line, if it does.

Jonathan Levinson : 11/21/2005 3:32:37 PM

QQQQ's gradual advance has pulled up the 30 and 60 min channels,, while organizing the scattered short cycle indicators, only now rising toward overbought territory. Only the wavelet indicators are looking maxxed out, suggesting that there's still room to the upside. This morning's highs haven't yet been tested, with the bounce stopping 1 cent below our breakeven 41.49 stop. Link

Linda Piazza : 11/21/2005 3:31:11 PM

The TRAN broke out again. The SPY finally managed a climb over 125.50, although it's showing some of the same characteristics it did earlier. The OEX converted its last little H&S into a rising regression channel. Meanwhile, the advdec line continues to find resistance at a line now at 1242 (but the numbers change quickly because of the large numbers involved in the advdec line). We saw a lot of potentially bearish developments, but the bulls aren't ready to let go yet.

They could be as market-on-close orders hit, so be careful if in bullish positions. The downdrafts have sometimes been swift today.

Linda Piazza : 11/21/2005 3:26:02 PM

OEX/SPX/SPY Option Trade Exit Point Alert
Entered the bearish play at OEX 575.58. Took partial profit at 574.75. Exited rest of play at 575.82.

Linda Piazza : 11/21/2005 3:24:09 PM

OEX/SPX/SPY Option Trade Exit Point Alert
Let's exit the play. This could still result in a profitable play with the OEX rounding down into that H&S on its one and two-minute charts, but the markets are just playing with us today and charts are deteriorating into an impossible to read mess.

Linda Piazza : 11/21/2005 3:18:03 PM

"They" did it again, spiking prices higher only to sell into them. Doesn't mean that our play will be successful, because essentially what's happening is that bulls and bears are still battling it out.

Linda Piazza : 11/21/2005 3:10:18 PM

TRAN breaking to the upside again. OEX heading up to test the right-shoulder area near 575.90. there as I typed.

Linda Piazza : 11/21/2005 3:08:39 PM

I'm watching the SPY today so I can watch volume on something sort of related to the OEX. Every time the SPY spikes up toward 125.50, it's hit again on big volume. That's distribution. Now all that extra supply at that level can be absorbed. If it is, the SPY will go higher, but so far, that's what's been happening. There's supply there.

Jonathan Levinson : 11/21/2005 3:06:40 PM

Volume breadth is +1.5:1 on the NYSE, +1.1:1 on the Nasdaq here. Updated QQQQ chart at this Link

Linda Piazza : 11/21/2005 3:06:32 PM

The TRAN is bouncing again, but it now looks to me as if it's formed a bearish right triangle--flattish support near 4142 and lower highs. Something has got to happen soon or we need to close out this play, however. There's just too much of a possibility of the bulls taking a look at the failure to follow through and sending the markets up higher into the close.

Linda Piazza : 11/21/2005 3:04:50 PM

OEX testing the shoulder area of that H&S on its 2-minute chart.

Linda Piazza : 11/21/2005 3:01:01 PM

Another potential H&S on the OEX's one-minute chart, head at that stop-running push higher at 2:36, neckline at about 575.28, if I'm reading it correctly. OEX at 575.45 as I type.

TRAN retesting those two-minute 100/130-ema's.

Linda Piazza : 11/21/2005 2:54:34 PM

The OEX has now fallen beneath a short-term (since the 1:09 candle) rising trendline. It may rise back up to retest it, with that trendline now crossing at about 475.48. The trendline off the 12:18 low is down at about 575.08.

Linda Piazza : 11/21/2005 2:52:30 PM

I've been ignoring the BIX today, and I shouldn't. It's at its high of the day, pulling back only slightly as I typed. BIX at 364.45, with the high at 364.65. It's testing the horizontal line that had roughly bisected its broadening formation on its daily chart.

Linda Piazza : 11/21/2005 2:49:31 PM

Every time the TRAN appears ready to break down, it spikes back up again. Bulls aren't through yet. So far, the TRAN just retests the latest trendline that it broke through, bouncing from 4142-ish support, but it could rise to retest those two-minute 100/130-ema's again. Yes, it's doing it as I type.

Linda Piazza : 11/21/2005 2:46:41 PM

OEX/SPX/SPY Option Trade Exit Point Alert
There is great danger in this bearish play we're in, and you've had an opportunity to take partial profit and now to exit near our entry point. All the elements are beginning to come together for a decent bearish play, but we're still subject to wild spikes higher and we saw all the elements come together many times without producing any downside over the last few weeks. So, if you're nervous or lost too much last opex cycle to risk such a spike, you might exit now. The play stays open officially for now.

Jane Fox : 11/21/2005 2:45:07 PM

THis is bullish because both are rising. Link

Jonathan Levinson : 11/21/2005 2:44:59 PM

Volume breadth is holding at +1.46:1 on the NYSE, +1.02:1 on the Nasdaq. There remains a persistent bid, with price consolidating at the high end of its range. This choppy advance has been the work of short cycle upphases that appear every bit as corrective as the preceding downphases, but it would take very little to shake things up- probably a single buy or sell program could do it. Link

Linda Piazza : 11/21/2005 2:43:27 PM

Advdec line dropping a little, TRAN still dropping. Now we just have to get the OEX to cooperate, too. The advdec line is just dropping into next support, though, so could still bounce back up toward the 1000-ish level again. It's at 711 as I type, with nearest support down to about 500.

Linda Piazza : 11/21/2005 2:40:27 PM

TRAN dropping harder now, but now needs to get below 4142 . . . just did. Now needs to stay below that.

Linda Piazza : 11/21/2005 2:39:54 PM

Did you see what "they" did? They popped the OEX up above its range for the last forty minutes or so, to encourage bulls to go long--and almost tempt me to exit that play--and then they sold it hard.

Linda Piazza : 11/21/2005 2:36:58 PM

Next we need to see the TRAN drop below 4142 support. TRAN at 4145.20 as I type, bouncing back to test those averages.

Linda Piazza : 11/21/2005 2:36:04 PM

A first two-minute close for the TRAN below the two-minute 100/130-ema's (both of them) since November 16, when it stopped consolidatin gat the bottom of its decline and began climbing. The two-minute 100/130-ema's had been topping advances all that day. It's just a small violation of those averages just yet, though, and it's bouncing immediately, as could be expected, to retest them.

Linda Piazza : 11/21/2005 2:33:39 PM

TRAN dropping again beneath those two-minute 100/130-ema's. This time, we want it to stay. Please. I'd like to see a strongly profitable play for all you readers!

Linda Piazza : 11/21/2005 2:28:23 PM

The TRAN has produced and is testing the neckline of an inverse H&S on its one-minute chart.

Linda Piazza : 11/21/2005 2:27:57 PM

OEX testing resistance that looks strong on a 15-minute closing basis, at 575.90-576.05. OEX at 575.83.

Linda Piazza : 11/21/2005 2:26:47 PM

TRAN testing the two-minute 21/100/130-ema's. It hasn't sustained values below them yet, and so might rise once again to test the 4150-ish zone, but each subsequent test of those averages shows more weakness--an "almost" touch after which the prices sprang away, one two-minute bar after which it bounced, several two-minute bars, then an actual piercing of all the averages, followed by a bounce at which it found resistance quickly . . . so far. That doesn't prove that the TRAN is going to plunge and help our OEX bearish position, but I'm watching. We're at the entry level as I type, but likely to test the 575.70-575.90 zone again. Yep, happening as I type.

Linda Piazza : 11/21/2005 2:23:28 PM

Potential H&S on the OEX's 1-minute chart, the OEX rising into the right shoulder as I type.

Linda Piazza : 11/21/2005 2:17:11 PM

The TRAN tests its two-minute 130-ema now, being below its 100-ema on that chart. If the TRAN steepens its decline, that will help our bearish OEX play.

Jonathan Levinson : 11/21/2005 2:16:17 PM

Stepping away for a few minutes.

Linda Piazza : 11/21/2005 2:12:37 PM

TRAN below the two-minute 100-ema, slightly above the 130-ema. Not below both yet, although it's dropped below another short-term rising trendline again, with another at about 4141.30.

Linda Piazza : 11/21/2005 2:08:10 PM

TRAN dropping toward those two-minute 100/130-ema's again, with those at 4145.30 and 4143.86, and with the TRAN currently at 4146.21. Remember that the move above these averages and then retest of them marked the beginning of the TRAN's charge higher on 11/16, after its steep decline. I'm hoping that a TRAN drop below those averages--soon, please--will mark a change to a short-term bearish tenor. TRAN dropped further as I typed, and it's at those averages now.

Jonathan Levinson : 11/21/2005 2:02:43 PM

So far, today's low volume, tight range has made a lower low and lower high compared to Friday's print. There's nothing bullish about that, unless it's an accumulation dip, which is certainly plausible. Even with our short stop right at breakeven and 3 cents off the session high, it keeps feeling like the market's ready to erupt to the upside. I suspect that those in bullish positions feel just the reverse.

Jane Fox : 11/21/2005 1:58:11 PM

TICKS +1000

Jane Fox : 11/21/2005 1:56:34 PM

Both AD Volume and line are making new daily highs so I guess I have to jump into the bulls corner...for now.

Jane Fox : 11/21/2005 1:55:25 PM

The TICKS range from +1024 to +463 does reveal a bullishness to this market.

Jonathan Levinson : 11/21/2005 1:53:47 PM

QQQQ's traded some 45.5M shares so far today, roughly the same as the first 1.5 hours on Friday.

Linda Piazza : 11/21/2005 1:49:58 PM

TRAN dropping again now after again attempting an upside break, so far forming a lower high. It's still above those two-minute 100/130-ema's, however, now temporarily finding support on the 2-minute 21-ema at 4146.42. We absolutely need to see the TRAN below those 2-minute 100/130-ema's at 4144.90 and 4143.34 to even begin to get some downside traction in our play, too.

Jane Fox : 11/21/2005 1:42:55 PM

Dang it both AD volume and AD line have now made a new daily high but then immediately turned around telling me they were just fooling us.

Linda Piazza : 11/21/2005 1:42:23 PM

OEX/SPX/SPY Option Trade Exit Point Alert
We've had the stop-runing move. Now let's see what the bulls and bears do with it. Stand by. May need a quick exit.

Jonathan Levinson : 11/21/2005 1:40:54 PM

Volume breadth gets up to +1.03:1 for the Nasdaq here.

Linda Piazza : 11/21/2005 1:40:05 PM

OEX/SPX/SPY Option Trade Exit Point Alert
Stand by for an exit if the advdec line and TRAN resistance I'm watching being tested do not hold.

Linda Piazza : 11/21/2005 1:38:53 PM

And here comes the push I've been fearing, coming right in the stop-running time of day. Watching the advdec line and the TRAN and the OEX closely.

Jane Fox : 11/21/2005 1:38:21 PM

TICKS +800 so the bulls are pulling another rabbit out of its hat.

Jonathan Levinson : 11/21/2005 1:38:11 PM

QQQQ's 30 min keltners are treating this as a pennant, narrowing against the increasingly rangeless drift. Volume has tapered off to nothing here as traders' minds turn to turkey and cranberry. Link

Jane Fox : 11/21/2005 1:37:56 PM

The AD volume and AD line are telling me chop to bearish but the VIX making new daily lows is telling me bullish. One or the other has to give in.

Linda Piazza : 11/21/2005 1:37:44 PM

The steeply ascending trendline along which the OEX climbed off last Wednesday's low now crosses at about 574.63. The OEX is trading sideways into that trendline, so there's danger that, without a steep drop soon, it will find support there again.

Linda Piazza : 11/21/2005 1:34:53 PM

Advdec line not giving up its test of resistance. OEX, either. The TRAN is below the former triangle, but still testing the two-minute 100/130-ema's. At this point, we just have to await the outcome, but I think we're going to have to consider that H&S on the OEX's five-minute chart invalidated without a decline in the next five to ten minutes.

Linda Piazza : 11/21/2005 1:28:38 PM

The OEX needs to confirm that H&S on its five-minute chart fairly soon or I think the formation is invalidated due to the right shoulder extending sideways too long. That's not something that bears want to see. The neckline looks as if it's at about 574.77 as I type, with the advdec line at 574.90.

Jonathan Levinson : 11/21/2005 1:25:58 PM

Volume breadth +1.3:1 on the NYSE, -1.2:1 on the Nasdaq.

Linda Piazza : 11/21/2005 1:25:08 PM

So far, the TRAN has turned down from the former support that it just retested, but it needs a two-minute close beneath the 100/130-ema's on that chart, with those at 4144.50 and 4142.70, respectively. If you wonder why I'm worrying about two-minute closes, it's because the TRAN has not closed beneath those since Wednesday, 11/16, when it began climbing off its steep decline. It came back and retested those averages and then was off to the races in this latest zoom higher. They mean something. The TRAN is at 4144.37 as I type, testing them, but not yet closing beneath them.

Linda Piazza : 11/21/2005 1:20:12 PM

Earlier today when the TRAN would break through a supporting trendline, it would immediately, on the next two-minute bar, bounce right back above that formation. It's not doing that in the same way since breaking through its triangle support, with that former support now having risen to about 4146.30. It's possible, though, that the TRAN is just widening that triangle into a different formation, perhaps a bull flag at the top of its climb.

Jane Fox : 11/21/2005 1:19:58 PM

AD volume has not yet made a new daily high and I am growing more and more bearish. Unfortunately the VIX does not support this bearishness because it is making new daily lows. What to do?

Linda Piazza : 11/21/2005 1:16:27 PM

The resistance that the advdec line faces right now looks massive. However, the OEX and TRAN are both testing support that they've just refused to fall through today. One or the other has got to win, and there's just no telling which it is going to be right now. If the big caps and the transportation stocks bounce hard, then that advdec line is going to move up, too, and have enough momentum to burst through that resistance.

Linda Piazza : 11/21/2005 1:14:14 PM

I just corrected the partial-profit point in the post preceding this. It was at 574.75.

Linda Piazza : 11/21/2005 1:13:55 PM

OEX/SPX/SPY Option Trade Exit Point Alert
OEX bearish entrance at 575.58. Partial profit at 574.75. Original 572.50 downside profit target retained for now for the rest of the position, although I may actually raise that target if the play doesn't begin performing better.

Linda Piazza : 11/21/2005 1:10:33 PM

OEX/SPX/SPY Option Trade Exit Point Alert
To be safe, let's take partial profit here, with conservative traders exiting the entire position. Keep the original profit target of 572.50 for the rest of the position unless otherwise noted. Lower stops an account-appropriate amount on the rest of the position, with aggressive traders keeping the original stop.

Jonathan Levinson : 11/21/2005 1:10:32 PM

I sure do miss my crude oil and natgas quotes. Hopefully IB will get back with the program soon.

Linda Piazza : 11/21/2005 1:09:04 PM

First, the TRAN tried breaking through that triangle I was watching to the upside. Now it's trying to break through to the downside. It needs 2-minute closes beneath the two-minute 100/130-ema's at 4144.43 and 4142.42 before that downside break could be considered confirmed, however, and then the next rising trendline crosses at about 4139, and then the next at about 4127. The TRAN is at 4144.54 as I type.

Linda Piazza : 11/21/2005 1:06:01 PM

According to the charts I'm studying, the VIX has to close above 11.28 on a 60-minute close before it's done anything that changes its tenor since the late-afternoon on 11/16. Since then, all 60-minute closes have been below that level. The VIX is at 11.09 as I type.

Jonathan Levinson : 11/21/2005 1:05:21 PM

Foreign central banks took a very respectable 12.7B of the 34B in 13- and 26-week bills auctioned. The high-rate on the 13-week bills was 3.94% yielding 4.034%, the bid-to-cover ratio 2.59. The 26-week bills sold for a high-rate of 4.155% yielding 4.303%, with a 2.52 bid-to-cover ratio.

Linda Piazza : 11/21/2005 1:03:53 PM

The volatility indices certainly aren't suggesting anything supportive of bearish plays, but the TRIN has pretty much been climbing since about 11:00, as Jane may have already noted.

Linda Piazza : 11/21/2005 12:59:29 PM

The OEX heads up toward the topmost feasible area for its H&S on its five-minute chart, with that at about 575.70 or so currently, on a five-minute close. The advdec line is holding resistance okay, but testing, testing in way that's not particularly comfortable to watch, given what's happened lately with the advdec line. A punch higher, in either the advdec line or on the OEX, cannot be ruled out yet.

Jonathan Levinson : 11/21/2005 12:58:51 PM

QQQQ continues to trade right on the pivot and 72 SMA, struggling with 41.40 resistanceas a the short cycle makes a very low volume, slow bounce. If this is a bear flag, then the next test of the lows should break through. However, any price traction, perhaps contributed by the Treasury auction results due in the next 5 minutes, should tap our 41.49 stop. Overall volume is quite light, but price remains firm. Link

Jane Fox : 11/21/2005 12:43:35 PM

TICKS +800

Linda Piazza : 11/21/2005 12:41:26 PM

An OEX climb much above 575.75 would probably invalidate the H&S formation on its five-minute chart. The TRAN is breaking out of that triangle to the upside, so there's some danger here. The advdec line rising to test resistance from about +350 to +500.

Linda Piazza : 11/21/2005 12:34:39 PM

I had a post prepared and in the uploading window to take partial profits as the OEX tested the neckline area of the H&S on the five-minute chart when the OEX bounced. I'm watching the TRAN, with its H&S now morphed into a triangle at the top of its climb, which I don't like to see.

Jonathan Levinson : 11/21/2005 12:31:25 PM

Stepping away for a few minutes.

Jane Fox : 11/21/2005 12:28:17 PM

With a lackluster +100 AD line the chances that AD volume does not make a new high are pretty good. This markets smells bearish but the bulls are just not going to let them win without a fight.

Linda Piazza : 11/21/2005 12:27:52 PM

OEX/SPX/SPY Option Trade Signals
We have a rather well-formed H&S now visible on the OEX's five-minute chart, with the OEX currently in the right-shoulder formation. Although the advdec line is rising slightly, I'm not inclined to bail on the bearish play right now, even though it certainly hasn't been a stellar performer just yet. Make up your own mind, though, as you could probably exit now near breakeven level on your option. I may take partial profit soon rather than waiting for the drop into 572.50, though.

Jane Fox : 11/21/2005 12:26:50 PM

AD volume is once again testing daily highs and if it fails again (would be the 3rd time today) then I will be watching a lot closer for signs of bearishness creeping in. I have seen the AD volume hit a wall that it cannot break and eventually it breaks down.

Jonathan Levinson : 11/21/2005 12:25:29 PM

QQQQ returns to the pivot, bouncing from a double bottom above 41.24: Link

Linda Piazza : 11/21/2005 12:20:13 PM

Failing a strong bounce that occurs immediately to invalidate the formation, the TRAN has just confirmed the H&S on its one-minute chart, and has a downside target of 4130.

Of course, the TRAN bounced hard as I typed, and is retesting the neckline. Just retesting, so far. TRAN at 4144.41 as I type.

Linda Piazza : 11/21/2005 12:18:11 PM

TRAN testing the neckline of its regular H&S as I type. Bounce time or failure time?

Linda Piazza : 11/21/2005 12:17:27 PM

OEX Keltner picture: Nearest Keltner support at 574.55 on a five-minute closing basis. Nearest resistance at 574.05. I wouldn't be surprised to see the OEX bounce up to test that resistance or higher resitance near 575.55, but that depends a lot on what happens with the TRAN and the whole inverse/regular H&S showdown going on right now, although I think the TRAN has invalidated that inverse H&S now because it's taken so long to form the right shoulder.

Linda Piazza : 11/21/2005 12:14:14 PM

The TRAN is testing the inverse right-shoulder level. If it falls much more the 4145 level, it will invalidate the foramtion, but it could bounce from here, especially as it's testing the 1-minute 100/130-ema's, too. In addition, there's a lopsided H&S onits five-minute chart, and if it falls too much further, it will confirm that and there's probably some resistance to confirming that formation. The neckline for the regular H&S appears to be at about 4144.45 currently.

The TRAN began bouncing more strongly as I typed.

Jonathan Levinson : 11/21/2005 12:12:53 PM

The NYSE will close at 1PM Friday, but it appears that the Nasdaq will be open the whole day, unless I'm missing something. Anyone?

Jonathan Levinson : 11/21/2005 12:09:54 PM

TNX is down 4.5 bps at 4.457%, IRX flat at 3.912%.

Jonathan Levinson : 11/21/2005 12:04:08 PM

Headline:

12:01pm IMF; CHINA'S MUST REBALANCE GROWTH TOWARDS CONSUMPTION

12:01pm IMF: CHINA'S ECONOMIC PROSPECTS 'BROADLY FAVORABLE'

12:01pm IMF: CHINA'S ECONOMY HAS BEEN STRONGER THAN EXPECTED

12:01pm IMF SEES SCOPE FOR CHINA TO ALLOW YUAN TO STRENGTHEN

Jonathan Levinson : 11/21/2005 12:03:26 PM

From the Treasury website:

FOR IMMEDIATE RELEASE CONTACT: Office of Financing November 17, 2005 202/504-3550 THANKSGIVING HOLIDAY SCHEDULE Due to the Thanksgiving holiday, Treasury will announce its offerings of 13- and 26-week bills at 11:00 a.m. eastern standard time on Wednesday, November 23, 2005. Also, the noncompetitive and competitive closing times for the 2-year note to be auctioned on November 23 will be 11:00 a.m. and 11:30 a.m. eastern standard time, respectively. Treasury will make the complete offering announcement for the 2-year note on Monday, November 21, 2005. These schedule changes are consistent with the Bond Market Association's recommendations for an early closing on Wednesday, November 23 and a full market closing on Thanksgiving Day.

I will be away for Thanksgiving and Friday, Nov. 25th, back as usual Monday AM, the 28th.

Linda Piazza : 11/21/2005 12:02:52 PM

The TRAN's one-minute chart has the potential for an inverse H&S now, with the TRAN at a potential right-shoulder level now, at 4147.76. If the TRAN drops below about 4145, that formation would appear to be invalidated. A push above about 4151 would confirm the formation.

Marc Eckelberry : 11/21/2005 12:01:36 PM

If still in the QQQQ Jan 41 puts, take partials or close entire position at NQ 1655. That should be around 40.77, which is also gap close from 11/17. That should also give a profit from 1.05 at this point, with VXN higher.

Linda Piazza : 11/21/2005 11:55:38 AM

On the OEX's swing high this morning, there was decided bearish price/RSI divergence. Doesn't mean that our play will be successful, but it was one point in its favor. Now the OEX has risen to test 60-minute Keltner resistance at 565.64 on 60-minute closes, with pronounced bearish divergence on that chart, on this morning's swing high. Sure wish there would be some follow-through to the downside, however.

Jane Fox : 11/21/2005 11:43:14 AM

I guess I should have taken my own advice about the AD line's tentative bullish high at +381 because it has now reverted to back below the 0 line. On the other hand until the AD volume does the same thing I am still not joining the bear's corner.

Linda Piazza : 11/21/2005 11:38:42 AM

The OEX has minimally confirmed that newest H&S. The downside target from that formation is at about 573.95.

Jonathan Levinson : 11/21/2005 11:37:08 AM

Volume breadth is down to +1.5:1 on the NYSE, -1.35:1 on the Nasdaq.

Linda Piazza : 11/21/2005 11:35:01 AM

Earlier today, the OEX confirmed a small H&S on its one-minute chart, meeting the downside target. That formation now is part of the head for a larger H&S, still best viewed on a one-minute or three-minute chart. The neckline is being tested now, and this is an important test for those of us in bearish positions. Neckline at about 575.03. OEX at 575.25, and trying to bounce from that neckline.

Linda Piazza : 11/21/2005 11:32:41 AM

Advdec line beginning to drop now.

Linda Piazza : 11/21/2005 11:29:45 AM

The OEX is rising to retest resistance, hopefully to fail below about 575.90, but the advdec line isn't climbing in the same way. The OEX is front-running any move in the advdec line, which is mostly straight-lining right now. If anything the advdec line eases a little, but it's not back to falling quickly yet, the way I'd like to see it do.

Jonathan Levinson : 11/21/2005 11:26:10 AM

GM is down 12 cents here at 23.93. My guess is that this morning's news, while entirely depressing, was certainly not bearish (at least not for GM stock), and more bullish yet for GM bonds. But with the stock trying to recover from 14 year lows in a very difficult business cycle, the sellers don't appear to be done yet.

Jonathan Levinson : 11/21/2005 11:21:47 AM

Session high for ten year notes at 109 5/64, TNX down 4.9 bps to 4.453%.

Linda Piazza : 11/21/2005 11:19:46 AM

OEX/SPX/SPY Option Trade Signals
There is a possibility of an advdec line bounce back up to about +600. It will carry the OEX up, too, if it does, which is why I mentioned the possibility earlier of an equal-high test or a slightly higher high on the OEX.

Linda Piazza : 11/21/2005 11:18:20 AM

Bears want to see the OEX below 575.14 on five-minute closes as a first step in the right direction on that chart, too. The OEX is at 575.22 as I type.

Linda Piazza : 11/21/2005 11:17:24 AM

TRAN dropping quickly now, at least when see on a two-minute chart. Bears want to see the TRAN below 4140.85 on five-minute closes as another little step in the right direction for bearish plays. TRAN at 4143.89 as I type.

Linda Piazza : 11/21/2005 11:16:02 AM

OEX/SPX/SPY Option Trade Entry Point Alert
OEX bearish entry at 575.58. Account-appropriate stops above the day's high. Profit target 572.50. Unless another update changes that, take automatic profit there.

Linda Piazza : 11/21/2005 11:14:53 AM

OEX/SPX/SPY Option Trade Entry Point Alert
The TRAN has dropped below the ascending trendline off the day's low, only a short-term indicator of weakness, but still one to watch. Let's try it again with a bearish entry, stop an account-appropriate amount above the day's high, profit target of 572.50. There is a strong possibility of a bounce to retest the high, with maybe a slightly higher high.

Jonathan Levinson : 11/21/2005 11:13:57 AM

QQQQ - Stop Loss Adjustment Alert -

QQQQ short from 41.49, move stop to breakeven

Jonathan Levinson : 11/21/2005 11:13:23 AM

The Treasury has just announced that this week's 4-week bill auction will raise 6B of new cash (effectively a drain in that amount from available market liquidity) and the 2 year notes will pay down 5.348B, effectively a net add in that amount. Today's 13- and 26-week bill auctions will raise new cash of $1.088B.

Jane Fox : 11/21/2005 11:11:51 AM

The neckline of the reverse H&S on the bonds chart continues to hold. Link

Jonathan Levinson : 11/21/2005 11:10:14 AM

Thanks, Mark. I'm afraid to jinx it. This would be the spot where a stray buy program comes zinging out of nowhere, reverses our little gain, then drills the Qs to 1 cent above our stop before reversing...

Linda Piazza : 11/21/2005 11:08:54 AM

The OEX has a little H&S on top of its one-minute chart. Has descending neckline at about 575.81 currently, with the OEX at 575.89 as I type. It's just a little formation and a short-term one, but would tell us something about short-term sentiment.

Jane Fox : 11/21/2005 11:08:28 AM

THese two are also getting more bullish but with and AD line at +380 it is still tentative. Link

Jane Fox : 11/21/2005 11:07:10 AM

OK the VIX just caught up with ES and is now making new daily lows confirming ES's new daily highs so things are looking much better for the bulls now. Man that took a while.

Jonathan Levinson : 11/21/2005 11:05:22 AM

Looking forward to getting the stop down to breakeven on this one. Below 41.40, I'll snug it down: Link

Jonathan Levinson : 11/21/2005 11:03:43 AM

QQQQ - Entry Point Alert -

Short QQQQ at 41.49 stop 41.59

Jonathan Levinson : 11/21/2005 10:58:42 AM

Volume breadth is up to +2:1 on the NYSE, +1.4:1 on the Nasdaq.

Linda Piazza : 11/21/2005 10:58:13 AM

I think the TRAN has about 50-130 more upside points before it's in big danger of a major downturn, if it even gets that far.

Jane Fox : 11/21/2005 10:58:13 AM

Well it looks like the bulls have taken control but the VIX surely does not support it for it is now making new daily lows. AD volume is climbing to new daily highs as is the AD line but both are not even to their previous day highs.

Jonathan Levinson : 11/21/2005 10:57:44 AM

Still room to run on the short cycle upphase for QQQQ. It could set up a channel test at 41.57 before rolling over: Link

Linda Piazza : 11/21/2005 10:56:58 AM

OEX/SPX/SPY Option Trade Signals
I gave that play as long as I could, probably a bit too long, to work, as the advdec line is still not strong and now looking as if it needs to pull back on a short-term basis. But it was getting ahead of the failure point this morning and there was the chance for the OEX to climb strongly, into that 577-578 zone that I'd wanted to see it reach this morning, so we could scalp the long play and then look for a rollover. It just wasn't setting up that way this morning.

Jane Fox : 11/21/2005 10:54:52 AM

TICKS +1000

Linda Piazza : 11/21/2005 10:53:07 AM

OEX/SPX/SPY Option Trade Exit Point Alert
OEX bearish entry made at 574.50. Exit at 575.64, for a 1.14 point move against the position.

Linda Piazza : 11/21/2005 10:51:49 AM

OEX/SPX/SPY Option Trade Exit Point Alert
Exit now.

Jonathan Levinson : 11/21/2005 10:51:30 AM

QQQQ is offering plenty of chances to sell current levels, and with the short cycle indicators not yet maxxed out, I'm guessing that there's still upside gas left in the tank. At the current rate, however, 41.50 could be all the bulls have. If the price holds at or near current levels for another 10-15 minutes, we should see these oscillators getting toppy, and I will be looking for a short play with a tight stop to try to ride the next downphase. Link

Jane Fox : 11/21/2005 10:41:52 AM

THe VIX confirms a new ES daily high when it makes a new daily low. As you can see this did not happen here and I think the bulls have just seen a wonderful headfake. Link

Jonathan Levinson : 11/21/2005 10:41:32 AM

Session highs for ten year notes, TNX now down 3.7 bps at 4.465% and QQQQ holding at the highs.

Jane Fox : 11/21/2005 10:39:27 AM

AD volume continues to make new daily highs which is bullish but with an AD line at +186 I wouldn't get too excited about it.

Linda Piazza : 11/21/2005 10:39:15 AM

OEX/SPX/SPY Option Trade Exit Point Alert
All but the most aggressive traders should exit now. The advdec line has moved up to test stronger resistance and the TRAN has broken to a new high. I'm going to hold on a moment longer before closing the play officially because of the resistance the advdec line tests now is that that proved problematic at the opening. This is an iffy decision and perhaps the wrong one.

Jonathan Levinson : 11/21/2005 10:39:03 AM

Volume breadth goes green on both exchanges at +1.6:1 on the NYSE, +1.05:1 on the Nasdaq.

Jane Fox : 11/21/2005 10:37:26 AM

ES is making new daily highs as the VIX is hugging its daily highs. This is not a healthy climb so if long be nimble.

Jonathan Levinson : 11/21/2005 10:36:37 AM

Session high for QQQQ at 41.44 here, 30/60 min channel resistance holding at 41.52-.55: Link

Jane Fox : 11/21/2005 10:35:23 AM

Buyers are back TICKS +800.

Jonathan Levinson : 11/21/2005 10:34:35 AM

Euros had been bouncing until Trichet added that it would be precipitous to expect "a series" of rate hikes. Euro futures are dwon to a .03% gain at 1.1784 here. Link

Linda Piazza : 11/21/2005 10:33:38 AM

Looks as if the OEX needed a retest of the 10:14 high of 574.99. It's currently engaged in that test, with the advdec line engated in a test of the resistance that's held it back so far this morning, now extending up to about -175, with the advdec line now at -418.

Linda Piazza : 11/21/2005 10:28:14 AM

TRAN retesting the previous high of 4146.64. TRAN at 4145.55 as I type.

Linda Piazza : 11/21/2005 10:27:08 AM

The OEX is rising after our entry, with the advdec line rising, too. We'd like to see it stay below -300, with the advdec line at -574 as I type.

Jane Fox : 11/21/2005 10:26:11 AM

As long as these two are headed in opposite directions the markets will not be headed in any direction. Link

Linda Piazza : 11/21/2005 10:23:41 AM

OEX/SPX/SPY Option Trade Signals
The TRAN remains a problem for our bearish play, and bears would like to see it drop below 4128.81 on 15-minute closes. The advdec line continues to find resistance.

Linda Piazza : 11/21/2005 10:21:46 AM

OEX/SPX/SPY Option Trade Entry Point Alert
Entered a bearish OEX trade with the OEX at 574.50. Account-appropriate stop. Exit planned for 572.50, if touched, with updates to be provided if the picture changes.

Linda Piazza : 11/21/2005 10:20:37 AM

OEX/SPX/SPY Option Trade Entry Point Alert
Enter a bearish OEX trade here for aggressive traders only who are willing to risk an iffy play. All others paper-trade it. Choose a high-delta option, at least five-points in the money, with an account-appropriate stop, and participate only if you are skilled at getting between the bid and the ask, and can act quickly to enter and exit. Set your own account-appropriate stop. All but the most aggressive traders should exit at 572.50, if touched. Unless otherwise noted, the play will be officially closed at that point. I'll let you know if parameters set up so that the exit should be made sooner.

Jonathan Levinson : 11/21/2005 10:19:10 AM

So far, the various cycles are overlapping and opposed, and overall volume is light compared to Friday morning. This is clearly a hangover from opex Friday, and direction is still up for grabs. The 60 min cycle is more bearish than the 30, while the short cycle is corrective and sideways. 41.20-.50 is key range both price and keltner-wise, and a break of either level on an increase in volume shoud tell the tale. The middle of the range feels like a bare coin toss to me. Link

Linda Piazza : 11/21/2005 10:16:02 AM

Advdec line rising, rising into a test of the broken support from this morning. Although matters looked dire this morning, this need for a retest was present in the five-minute chart for the advdec line. However, with most important support broken but lower support not yet tested on the 30- and 60-minute charts, this was not a signal for a long play, either, just for a retest of broken resistance. If that resistance doesn't hold, we missed the long play, but I'm not calling any plays on a light-volume holiday week without confirmation. Watching now to see if we get any kind of confirmation of a rollover bearish play being possible.

Jonathan Levinson : 11/21/2005 10:13:22 AM

Volume breadth is still bifurcated between the NYSE and Nasdaq, now +1.42:1 on the NYSE and -1.42:1 on the Nasdaq.

Jonathan Levinson : 11/21/2005 10:12:49 AM

Bonds are strengthening, ten year notes to a new high and TNX down to a 3.5 bp loss at 4.467%.

Linda Piazza : 11/21/2005 10:12:11 AM

TRAN at a new high.

Linda Piazza : 11/21/2005 10:08:52 AM

TRAN still trying to rise, and the advdec line is rising into that former support that it broke through this morning. I want to see how it behaves first near -450 and then near -200 to -100, if it should rise into that second resistance zone.

Jonathan Levinson : 11/21/2005 10:08:51 AM

The lack of volume on the break of Friday's lows was the tell, and price has drifted back up on still light volume back into the lower end of the range. Direction is still up for grabs, but so far the short cycle downphase has been very unconvincing. Link

Jonathan Levinson : 11/21/2005 10:05:40 AM

Headlines:

NATURAL GAS OPENS UP 13.4 CENTS AT $11.28

CRUDE OPENS UP 44 CENTS AT $57.65 A BARREL

No signs of life from my Interactive Brokers Nymex feed.

Linda Piazza : 11/21/2005 10:02:30 AM

Advdec line and OEX bouncing. As usual lately, the OEX bounce has been more significant than has the advdec line bounce, which makes bearish positions on the OEX somewhat problematic. Watching the advdec line, the OEX, and the TRAN to see what develops, however.

Jonathan Levinson : 11/21/2005 10:02:23 AM

QQQQ tests 41.30 from below.

Jonathan Levinson : 11/21/2005 10:02:01 AM

Ten year note yields are up to a 2.6 bp decline at 4.476%, IRX flat at 3.912%, the yield curve flatter this morning.

Jonathan Levinson : 11/21/2005 10:01:21 AM

Headlines:

U.S. OCT. LEADING ECONOMIC INDICATORS UP 0.9%

7 OUT OF 10 U.S. LEADING INDICATORS RISE IN OCT.

U.S. OCT. LEADING INDEX SHOWS ECONOMY GROWING MORE MODESTLY

U.S. SEPT. LEADING INDEX REVISED TO DOWN 0.8% VS FALL 0.7

Jonathan Levinson : 11/21/2005 9:58:52 AM

QQQQ holds a 41.24 low as the short cycle works its way lower toward channel support at 41.20. The 30 and 60 min cycles were not oversold, and the daily and weekly cycle are overdue for downphases, and so I expect this 41.20 level to be a starting point. If price doesn't bounce back above 72 SMA resistance at 41.36, those levels will begin to drop. Link

Linda Piazza : 11/21/2005 9:55:37 AM

Okay, the advdec line certainly supports the bearish more than the bullish side today. Watching now for a possible OEX bounce on a short-term advdec line bounce, however, to see if there's a retest that gives us a bearish entry today. It may not happen, but I'm hopeful that it will.

I'd actually hoped for a first bullish scalp. That certainly didn't occur.

Jane Fox : 11/21/2005 9:55:13 AM

The AD volume is still above 0 but the AD line has fallen to -186 which means nothing except this is setting up to be another miserable day for trading.

Linda Piazza : 11/21/2005 9:54:21 AM

Advdec line still looks overdone to the downside on the five-minute chart. The OEX and TRAN both test support, neither quite below it yet although the OEX looks weaker than the TRAN. On the 30- and 60-minute charts, the TRAN looks as if it has far to go to the downside, if it continues moving down, but looks as if it needs a bounce on the five-minute.

Jonathan Levinson : 11/21/2005 9:53:44 AM

The Fed announces a hefty 7.5B overnight repo, for a net 5.5B add. Demand was higher for the money, though, with the stop out rate up to 4.01.

Jonathan Levinson : 11/21/2005 9:50:48 AM

The Fed has 2B in weekend repos expiring this morning. Awaiting the announcement any time.

Jane Fox : 11/21/2005 9:49:30 AM

The VIX is now confirming ES's new daily lows with new daily highs. That little bit of bullish I saw earlier sure dissipated quickly.

Linda Piazza : 11/21/2005 9:49:00 AM

OEX testing 574-ish Keltner and historical support. Would like to see it fall beneath this, then rise to retest it with a failure there before initiating a new bearish play. The advdec line is not looking good at all, though, not giving the initial pop up to a safer zone from which to test the downside on the OEX. I'm just not getting strong enough confirmation to issue a trade for readers yet, although a pullback and retest might give it to us yet.

Jonathan Levinson : 11/21/2005 9:48:46 AM

QQQQ loses 41.29 support. Volume isn't particularly heavy, but price is below Friday's lows.

Linda Piazza : 11/21/2005 9:46:41 AM

The OEX tests support that looks strong enough to bounce it over the short-term, with the advdec line looking very overdone to the downside over the very short-term. That suggests to me another bounce attempt may be possible, with an emphasis on "may," but there's plenty of downside to go on the advdec line if it can't get above about +200 and stay there. As I typed, the OEX was attempting to bounce from that support I mention, not very successfully.

Linda Piazza : 11/21/2005 9:45:05 AM

The TRAN is heading down toward the 15-minute 21-ema at 4124.81, an average that has been bouncing it the end of last week. The TRAN is at 4132.52.

Jonathan Levinson : 11/21/2005 9:44:34 AM

Volume breadth is still mixed and the price is deadlocked in Friday's range. Perhaps the LEI at 10AM will get things moving.

Jane Fox : 11/21/2005 9:44:23 AM

I am seeing the VIX confirming ES's new daily highs but this is by a very small margin. Grabbing at straws here.

Linda Piazza : 11/21/2005 9:44:04 AM

Strange morning and everything seems in slow motion. The advdec line is still testing support, not holding up particularly well.

Jane Fox : 11/21/2005 9:41:36 AM

Both the AD line and AD volume are above 0 but barely telling me we back to a choppy non directional market.

Jonathan Levinson : 11/21/2005 9:41:23 AM

Gold hit 490.40 earlier, currently +2.6 at 489, at 18 year highs. Daily chart updated at this Link

Jonathan Levinson : 11/21/2005 9:39:53 AM

QQQQ approaches range support from Friday at 41.29. A break below that level on volume should see a quick move to challenge the channel bottoms lined up at 41.20, and turn those channels down failing an immediate bounce. Link

Linda Piazza : 11/21/2005 9:38:46 AM

Advdec line turning down again. OEX approaching potentially strong short-term support.

Linda Piazza : 11/21/2005 9:36:56 AM

The OEX appears to have possibly strong Keltner support in the 573.70-574.15 zone. So far, the advdec line is still climbing, but it's not inspiring as much bullish cheer as I expected this morning. I had hoped to see an OEX pop higher into that resistance band I mentioned, thinking that the setup might allow us to participate in a bullish scalp up into that zone and then exit and wait for signs of a rollover. I'm just not getting the bullish part of that signal, though. Not yet.

Linda Piazza : 11/21/2005 9:34:46 AM

Advdec line moving up a little.

Jonathan Levinson : 11/21/2005 9:34:31 AM

Volume breadth is +1.2:1 on the NYSE, -1.2:1 on the Nasdaq at the open.

Linda Piazza : 11/21/2005 9:34:00 AM

Advdec line climbing, but not significantly, and only into first support. Ambiguous evidence, but the advdec line action is not as strong as I expected it this morning. I expected at least a pop. Some opex-related stuff? I'm not certain. No clear signal yet, but so far, it's looking weaker than I expected/hoped at the open.

Linda Piazza : 11/21/2005 9:32:38 AM

TRAN turning slightly lower. Nothing major yet.

Jonathan Levinson : 11/21/2005 9:32:31 AM

QQQQ's 30/60 min channel support is at 41.20-.25. Resistance is 41.50-.53: Link

Linda Piazza : 11/21/2005 9:31:57 AM

Advdec line may be opening a little below support. Watching to see if it heads up or down.

Tab Gilles : 11/21/2005 9:30:37 AM

Biotech HOLDRs (BBH) Looked at some HOLDRs this weekend, BBH looks like it has some more upside on the weekly chart. 3 other charts...HHH, BDH & OIH. Link Link Link Link

Jonathan Levinson : 11/21/2005 9:29:37 AM

Headline:

ECB TRICHET REITERATES COUNCIL READY TO MAKE A RATE DECISION

ECB TRICHET REITERATES PLAN TO 'MODERATELY AUGMENT' RATES

Jonathan Levinson : 11/21/2005 9:25:51 AM

QQQQ's 30 min cycle indicators are turning up from above oversold, while the 60 min cycle continues lower, currently at the midpoint of its range. Price action, of course, remains completely flat. I will update the channel support and resistance levels when they print on the opening bell.

Jonathan Levinson : 11/21/2005 9:12:35 AM

Interactive Brokers doesn't seem to be quoting crude oil or natural gas currently.

Jonathan Levinson : 11/21/2005 8:47:16 AM

Headline:

[GM] GM PLAN CUTS RETIREE HEALTH LIABILITIES BY 25% OR $15B

Jonathan Levinson : 11/21/2005 8:46:10 AM

GM trades +3.45% at 24.88.

Jonathan Levinson : 11/21/2005 8:43:40 AM

Headlines:

8:38am GM GM TO CLOSE OKLAHOMA CITY PLANT IN EARLY 2006

8:38am GM GM TO SHUT LANSING, MICH., CRAFT CENTER MID-2006

8:38am GM GM TO SHUT SPRING HILL, TENN., LINE 1 AT END 2006

8:39am GM GM TO SHUT DORAVILLE, GA., PLANT IN 2008

8:40am GM GM TO SHUT 3RD SHIFT AT OSHAWA NO. 1 ONTARIO PLANT IN H2 '06

8:40am GM GM TO SHUT 3RD SHIFT AT MORAINE, OHIO, IN 2006

Jonathan Levinson : 11/21/2005 8:38:56 AM

Headlines:

[GM] GM TO MAKE MUCH OF JOB CUTS THROUGH ATTRITION, EARLY RETIRES

[GM] GM ESTIMATES `SIGNIFICANT' RESTRUCTURING CHARGE FOR REVAMP

[GM] GM LIFTS RUN-RATE COST-CUT PLAN TO $6B FROM $5B BY END 2006

[GM] GM CONTINUES PLAN TO CUT MATERIAL COSTS BY $1B

Jonathan Levinson : 11/21/2005 8:35:18 AM

GM trades +2.91% at 24.75 in the premarket.

Jonathan Levinson : 11/21/2005 8:34:46 AM

Headlines:

[GM] GM MOVE CUTS N. AMER ASSEMBLY CAPACITY BY 1M BY END '08

[GM] GM TO CUT 30,000 MANUFACTURING POSTS BY END 2008

Linda Piazza : 11/21/2005 8:32:37 AM

On Friday, the OEX broke above the descending trendline off the March high. It ended the week at an equal high with the 9/09 intraday high of 575.16 and with the close that day of 574.13, with the OEX's Friday close of 574.69. I think that the next strong resistance is in the 576.90-578.20 resistance band, a long-term band that I've had on my charts for years and that stopped the OEX's advance this summer. I think the next strong support is probably at the 10-sma. Between those levels, trading might be choppy. Draw a line across the OEX's daily chart from its current level up to 580, and you'll see how it tends to behave in that zone. It chops. So, I think the best bet for most traders is to wait for a pullback to the 10-sma 567.25 for new long positions, with internals supporting such a play, or to wait for a bounce up to 577-578.50 to look for rollover possibilities for bearish plays. In between, I'll look for scalps if they look viable, but remember what low volume does to trading and be careful this week. I suggest not taking my scalping plays, but rather paper trading them to see if you think they're workable for you. I want you to consider them not as strong recommendations for plays, but rather as education, to see some of what I'm trading. There will be times when I have time to enter a trade, but you wouldn't have that time, by the time I could get the play information posted, and other times when posting the play keeps me from having time to enter it.

I think it's up to the TRAN to some degree, as to what happens to markets this week. I see two targets and possible strong resistance levels for the TRAN from 4200-4290. I don't think the TRAN will get much further than that without pullback back significantly, but I'm not sure that it will get there before pulling back, especially with crude climbing during the overnight session. If the TRAN is going up, then investors are likely to be reassured and send other indices up, too. If the TRAN is falling, especially if it's falling precipitously, they might bail on other positions. So, watch the TRAN.

Jonathan Levinson : 11/21/2005 8:26:24 AM

GE is due to commence a press conference at 8:30 to discuss a number of North American plant closings and other measures.

Jonathan Levinson : 11/21/2005 8:24:02 AM

Ten year notes hold their gains, up 11/64 at 108 29/32 here, with TNX quoted -2.8 bps at 4.474%, a level we've seen many times in both directions in recent years above the 4.44% confluence level: Link

Jane Fox : 11/21/2005 8:21:59 AM

Dateline WSJ Sharon Is Quitting Likud, Seeks Early Elections Israeli politics has been in flux more than anytime in the past few years since the former union boss Amir Peretz won the leadership of the left-leaning Labor Party last week, and Prime Minister Ariel Sharon followed up with his own not-entirely-unexpected shocker today. Mr. Sharon formally quit his hardline Likud Party with plans to form a new one and asked Israel's president to dissolve parliament, pushing for a March election. Mr. Sharon's decision to leave Likud, the party he helped establish in 1973, redraws Israel's political map, formalizing his transformation from hardliner to moderate, as the Associated Press writes. It also increases the chances of progress in peacemaking with the Palestinians. Mr. Sharon -- once classed among the hardest Likudniks on the right -- now seems sure to push for an assembly of politicians aimed at building support from what is widely seen as a centrist Israeli majority.

Jonathan Levinson : 11/21/2005 7:39:50 AM

Nov. 21 (Bloomberg) -- China is being forced to disclose its holdings of copper for the first time, as the nation seeks to limit losses from a trader's wrong-way bet on a drop in prices.

Link

Jonathan Levinson : 11/21/2005 7:28:47 AM

Equities are up, ES trading 1251.5, NQ 1685.5, YM 10793 and QQQQ -.02 at 41.43. Gold is up 2.8 to 489.20, silver is up .05 to 8.121, ten year notes are up 7/64 to 108 55/64, crude oil is up .075 to 57.225 and natural gas is down .545 to 11.395.

We await the 10AM release of Leading Economic Indicators, est. +.8%.

Linda Piazza : 11/21/2005 7:03:50 AM

Good morning. The Nikkei gained, but closed near its low of the day, more than 120 points below its high. Other Asian markets were mixed. Most European markets gain, with the FTSE 100 being the exception. As of 6:56 EST, gold was higher by $2.60 to $488.80, and crude, up $0.91 to $58.12. More details about Asian and European markets follows in succeeding paragraphs.

Last night, the Nikkei opened above 14,700 and had posted another 100 points before the close of the morning session, but it tumbled all the way to the flat-line level in the afternoon session. It then bounced off that low of the day, closing up by 57.31 points or 0.39%, at 14,680.43, but closing below the opening level.

Merrill Lynch & Co. increased its estimates for Japan's main indices based on the firm's interpretation of the likely currency moves. Japan's exporters are benefiting from the firmer dollar. Merrill Lynch has an upside target of 16,000 for the Nikkei 225, to be achieved some time before the end of 2006. The firm also re-weighted the carmakers to an overweight rating from the former neutral weighting and lowered telecommunications-related companies to neutral from overweight ratings. Perhaps after the close, the government released its assessment for the economy, forecasting a moderate economic recovery, although the government remains watchful of deflationary trends, as the last quarter showed a 1.1% drop in the GDP deflator. On the political front, Prime Minister Koizumi and Russian President Putin agreed to explore a resolution for a long-standing territorial dispute and to increase economic ties.

Technology and carmakers' shares led the gains, with exporters gaining in general. Pioneer Corp. continued strong gains made in recent sessions after announcing a change in executive lineup. Semiconductor stock New Japan Radio posted strong gains after it was subject to two tender offers for majority stakes. NEC Electronics reported its ambitious plans for boosting sales to China and returning to profitability. Sanyo Electric Co. did not participate in gains, dropping more than 3 percent at one point after reporting earnings.

Other Asian markets were mixed. Taiwan's current account surplus declined 83.5% from the year-ago level in the third quarter. The Taiwan Weighted slipped by 0.05%, and South Korea's Kospi lost 0.27%. Singapore's Straits Times declined 0.47%, but Hong Kong's Hang Seng inched up by 0.02%. China's Shanghai Composite rose 0.26%. Reportedly, oil major BP considers taking a position in China Aviation Oil. In China, new cases of bird flu in poultry were discovered.

Most European markets are higher this morning, but the FTSE 100 is in negative territory. Crude rises, with the gain in crude helping resource stocks, but the U.K. doesn't benefit as much as usual from any gains in its oil majors. GlaxoSmithKline dropped heavily in its first trading session since the U.S.'s FDA proposed re-labeling two of its asthma drugs. GSK disputes the proposal, saying it is not consistent with NIH treatment guidelines and could risk uncontrolled asthma in some patients. In other stock-specific news, France's Alcatel dropped as some speculated that it might bid for defense contractor Thales SA.

In the U.K., the ODPM's September HPI revealed that housing prices had risen more than expected, 3.3% year over year, up from August's 2.8% year-over-year figure. Italy's industrial orders for September dropped 3.3% month over month, and industrial sales dropped 5.3%. Since the previous three months had been strong, economists are not yet certain whether this was a pullback from previous strong performances, a resting, or the beginning of a downturn. September's Eurozone trade balance revealed a surplus on unadjusted terms, with August's deficit revised to show a narrower loss. On an adjusted basis, the trade surplus widened. Looking under the number, imports declined and exports rose, with indications that domestic demand drove the improvement in the unadjusted numbers. Germany's surplus had been the widest, and the Bundesbank later released its German economic outlook, saying encouraging things about the economy but cautioning that unemployment and high crude prices have made consumers hesitant to spend. The central bank also warned that Germany's deficit for the year would likely represent 3.7% of the GDP, and that would bring it well above the target of the EU.

As of 6:56 EST, the FTSE 100 was moderating its loss, down only 2.90 points or 0.05%, at 5,496.00. The CAC 40 was higher by 45.81 points or 1.01%, at 4,568.99. The DAX was higher by 38.94 points or 0.76%, to 5,138.66.

Market Monitor Archives