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Jeff Bailey : 12/8/2005 2:23:51 AM

BPOIL chart at this Link and a PnF chart of Apache Corp. (APA) at this Link

Jeff Bailey : 12/8/2005 1:53:42 AM

Sector Bullish % Changes ... According to Dorsey/Wright and Associates, Wednesday's action had the HOUShold goods sector reversing up to "bull confirmed" status from "bull correction" status. Currently 40% bullish.

OIL sector found more components generating PnF buy signals and after reversing up to bear correction status at 54% in late November has now achieved "bear correction" status and "bull confirmed" at 66%. In October, this sector bullish percent plunged to 36% after reaching as high as 88% in early August.

Jeff Bailey : 12/8/2005 1:32:17 AM

EIA Nat Gas storage due out tomorrow. Here's the table I will show once the data is known. What I've done is simply enter the same figure 3,225 bcf that was reported for the week ending November 25. This assumes no change. My 1, 2, 3 Month as well as year ago would be calculated accordingly. Here's the table Link

So... what do YOU think Nat. Gas bulls need, for further bullish market response?

I think a bull wants to at least see a draw/decline of 14 bcf. I say this, because a no net change would have the YEAR AGO showing a modest build, and that could calm some fears about a shortage.

With that in mind, there will also be market participants also factoring in this Link from mid-day. And this at 12:12 AM EST Link

Jeff Bailey : 12/8/2005 12:51:30 AM

Program Trading Levels for Thursday ... HL Camp & Company has their computers set for program buying at $+10.52 and set for program selling at $+7.58.

Jeff Bailey : 12/8/2005 12:46:00 AM

Bank of Japan's Fukui DJ - Bank of Japan Governor Toshihiko Fukui said Thursday the central bank would shift to a zero interest-rate policy after it ends quantitative easing.

He added that the BOJ will only end its current policy after judging price conditions from a range of economic data.

"We will analyze whether the core consumer price index is stable through various data, such as the supply/demand gap of the economy and unit labor costs," Fukui told reporters at a news conference here.

Jeff Bailey : 12/8/2005 12:24:49 AM

BCR Option Montage ... Here's the CBOE options chain from Wednesday's trade. Nothing unusual that I can see Link

Jeff Bailey : 12/7/2005 11:02:34 PM

SPY / SPX Option Montage at this Link ... Check this out. It is something that actually came to me in my sleep last night.

I've got to go get some dinner and will try and continue some thoughts/dreams later tonight, or tomorrow.

Think about this .... don't think of "retail options trader" as a dirty word, but think about who might tend to trade the SPY options, and who might tend to trade the SPX options.

Then think of the concept/theory of "Max Pain."

Then think of commonality, or a gravitation point as we near option expiration.

See how "random" the lines are when I try and connect the strikes of OPEN INTEREST (PINK) in the SPY. Then today's VOLUME (BLUE) in the SPY.

Then look at the SPX montage.

Special Note: An options trader questioned me on something important, and he is correct. It needs clarification on my part.

In the above option montage of both the SPY and SPX, I'm marking the #1 thru #6 most actives and Open Interest within the area I'm displaying.

Yes! The SPY Jan $123 Put (SPY-MS) is the current option with the MOST OPEN INTEREST. The SPY Dec 120 Put (SPY-XP) is #2 MOST OPEN INTEREST.

Today's #2 most active SPY option was the SPY Feb $130 Call (SFB-BZ) at 7,554:1,990 and Up/Dn tick I show was 0/1601, so I've got to think rollout, with somebody saying, SPY isn't going to settle above $130 + $1.00 = $131.00 come Feb. expiration.

Good catch! It is great to know that some traders are monitoring, analyzing their option chains!

OI Technical Staff : 12/7/2005 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 : 12/7/2005 9:53:11 PM

Quick notes .... SPY most actives today ... Dec 126 Call $1.00 close, then Feb $130 Call $1.00 close, then Dec 126 Put $1.10 close.

Wasn't there a commercial ... "a buck, a buck, a buck." Or something like that?

Jeff Bailey : 12/7/2005 9:31:47 PM

C.R. Bard (BCR) Link ... Cramer's "Mad Money" potential takeover candidate at $100.00.

It would take a trade at $68 to get the stock back on a "buy signal."

Should the stock trade $68, an initial bullish vertical count column from $62 to $68 would be under construction.

7 X, then multiply by 3 (for bullish counts). Then multiply by scale ($1.00). I come up with 21.

Then add the $21 (it could grow) to $62 and I get $83.

If it were true that BCR will get bought for $100.00, where would the bullish vertical count column have to rise from in its current condition?

Let's see .... $100 - $62 = 38.

Then $38 divide by 3 (for the bullish vertical count), and I get .... 12.66, say 12 X are needed from the $62 price.

Hmmm... $62 + 12 = $74.

Maybe check the option chain. If the RUMOR is true, then the originator of the RUMOR might have loaded up on a $75 strike call.

Jeff Bailey : 12/7/2005 8:58:25 PM

SPX swing trade put cancel order alert ... Cancel today's order (02:04:43 PM EST) to buy two (2) of the SPX Dec. 1,250 Puts (SZP-XJ) for $3.60.

Once done, replace with an order to buy two (2) of the SPX Dec 1,250 Puts (SZP-XJ) for $2.40. Stop will be $1.50, target an SPX trade at 1,250. This order will stay open until approximately 11:15 AM EST on Thursday, and I'll update progress, or any adjustments from there.

Jeff Bailey : 12/7/2005 8:41:43 PM

Pivot Matrix for Thursday at this Link ... QQQQ trades a penny under Wednesday's DAILY S2, actually double bottoms there intra-day. This is the stronger major index to this point.

BIX.X gets a trade at WEEKLY S1 and first equity-based index (in pivot matrix) to trade MONTHLY Pivot. Tomorrow, BIX.X has a DAILY S2/WEEKLY S2 correlation.

Jeff Bailey : 12/7/2005 6:21:37 PM

Closing Internals found at this Link

Jeff Bailey : 12/7/2005 5:38:11 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 12/7/2005 5:25:03 PM

Xilinx (XLNX) update ... Now expecting third-quarter sales of $414.9 million to $433.4 million vs. prior estimate of $402.9 million to $418.9 million.

Consensus was $412 million.

Year-ago quarter's sales were $398.9 million.

Gross margin guidance unchanged at 62% to 63%. Effective tax rate for the year, excluding the repatriation of $500 million in foreign exchange earnings, is expected to increase 23%, up from prior outlook for an increase of 21% to 22%.

Jeff Bailey : 12/7/2005 5:12:14 PM

Altera (ALTR) $19.30 -0.51% ... ticks higher at $19.35.

Jeff Bailey : 12/7/2005 5:11:14 PM

Xilinx (XLNX) $26.48 -1.85% ... higher at $27.17 after raising Dec. quarter sales guidance on better-than-expected N. America and Asia Pacific sales. Now sees sales up 4%-8% sequentially, which compares to prior guidance of up 1%-5% sequentially.

Jeff Bailey : 12/7/2005 4:58:27 PM

Current OPEN MM Profiles found at this Link

Jim Brown : 12/7/2005 4:41:44 PM

TXN Update TXN says they are seeing strong demand across all segments. Ups EPS estimates to 38-40 cents from 36-40 cents. Sees revenue in $3.56B to $3.70B range.

Update basically inline with what analysts expected for today. Consensus estimates are for 41 ccents but TXN is typically conservative in their updates. TXN has ranged from $32.80 to $33.86 after the news after a close at $33.50.

Jeff Bailey : 12/7/2005 4:00:39 PM

Sell Program Premium ... DIA $108.15, SPY $126.14, QQQQ $41.86.

Jonathan Levinson : 12/7/2005 3:58:03 PM

QQQQ breaks back above S1 after clearing 72 SMA resistance. The short cycle has room yet to run, but more importantly, the 30 min channel bottom is ticking up, the first indication of a bullish bias in the longer intraday cycles. Sesssion low was 41.63. Link

Linda Piazza : 12/7/2005 3:50:02 PM

A little short covering into the close. From my earlier comments, you know I thought that possible. I discount this as positioning ahead of the TXN update, but . . . I have no idea what that update will say or how markets are going to react. You've had good profits today if in bearish positions and the markets haven't been kind to bears lately, so make account-appropriate decisions. I'd be sure I was taking a little of my profit home tonight, locking in a little something. Markets could dive tomorrow, but they could . . . not.

Jeff Bailey : 12/7/2005 3:40:39 PM

Oil Service HOLDRS / Oil Service Index at this Link

Linda Piazza : 12/7/2005 3:39:48 PM

The OEX hasn't broken down yet out of its latest bear flag climb on its one-minute chart. Market-on-close orders in a few minutes.

Jonathan Levinson : 12/7/2005 3:38:28 PM

Updated daily QQQQ chart at this Link , the oscillators back to an imminent rollover but still in trending territory.

Linda Piazza : 12/7/2005 3:29:08 PM

Bounce attempt underway, with the OEX tangled up in all that five-minute Keltner resistance.

Linda Piazza : 12/7/2005 3:27:46 PM

The OEX rises to test five-minute Keltner resistancee from 574.50-574.86, with that resistance looking fiarly strong. I'm wondering, however, if we're moving out of a period in which chart characteristics and rather fear-of-the-semi's (for either bears or bulls) might go into effect. If you've been burned on one bearish play after another and you've got some profits today and you know that the SOX's decline has been a big part of the bearishness and you know that TXN reports this afternoon, might you be expected to take a little profit? I think there might be some, although I'm not sure yet that any bounce it produces will get too far.

Jeff Bailey : 12/7/2005 3:21:53 PM

03:00 Internals found at this Link

Linda Piazza : 12/7/2005 3:17:09 PM

The OEX is still trying to steady, but an attempt at an inverse H&S on the one-minute chart was invalidated about 15 minutes ago. The OEX needs to move above 574.82 on a one-minute closing basis to even begin to get a bounce underway, and five-minute resistance up to 574.87 currently looks strong. Remember TXN's after-the-bell update, though, as some tech shorts might want to cover ahead of that. OEX at 574.34. Just follow the OEX lower with your stops and begin thinking bout whether you want to hold overnight.

Jonathan Levinson : 12/7/2005 3:15:55 PM

Volume breadth eases back to -2.4:1 on the NYSE, -1.45:1 on the Nasdaq.

Jeff Bailey : 12/7/2005 3:09:41 PM

Sharper Image (SHRP) $10.52 +4.25% ... finds some action after credit figures.

Jeff Bailey : 12/7/2005 3:07:45 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 12/7/2005 3:03:14 PM

Ten year note yields finished up 2.3 bps at 4.517%, 13-week rates -.2 bps at 3.93%.

Jonathan Levinson : 12/7/2005 3:02:44 PM

Headlines:

U.S. OCT. REVOLVING CREDIT FALLS 2.4%

U.S. OCT. CONSUMER CREDIT POSTS RECORD-MAKING DROP

U.S. OCT. CONSUMER CREDIT FALLS $7.2 BILLION, OR 4%

U.S. OCT. NONREVOLVING CREDIT DROPS 5%, ALSO A RECORD

Jonathan Levinson : 12/7/2005 3:02:17 PM

QQQQ short cycle has turned up reluctantly, while a wavelet cycle upphase has just ended and is running lower: Link Provided that the current lows don't fail, this chop should constitute the bottoming process for the 30 min cycle. Bulls need a break above the 72 SMA at 41.80 to confirm a new 30 min cycle upphase.

Jeff Bailey : 12/7/2005 3:01:24 PM

Amrep Corp. (AXR) $27.38 +6.70% ... company's board of directors declares special cash dividend of $3.50 per share payable 01/09/06 to shareholders of record at the close of business 12/19/05.

The Board indicated that the Company's financial condition, substantial cash position and anticipated cash flow, particularly from its real estate operations, in relation to its current capital requirements were major factors in its determination to reward shareholders with this special cash dividend, which follows special dividends of $0.55, $0.40 and $0.25 per share that were declared following the close of AMREP's last three fiscal years ending April 30, 2005, 2004 and 2003. The Company said that the Board may consider special dividends from time-to-time in the future in light of conditions then existing, including earnings, financial condition, cash position, and capital requirements and other needs.

Linda Piazza : 12/7/2005 2:59:56 PM

OEX still churning just above and below those 11/29 and 12/01 lows. Bounce potential isn't yet undone, but the lower the OEX stay beneath about 574.55, the more likely it is that it will drop toward the next downside target at 573.51.

Linda Piazza : 12/7/2005 2:58:21 PM

TRAN breaking just below the day's low, now at Keltner support and just above 4100, at 4105.31 as I type.

Linda Piazza : 12/7/2005 2:50:55 PM

The OEX is bouncing from just above Keltner support and also from the general area of the 11/29 and 12/01 lows. This is likely a bear-flag kind of rise, with next resistance at 575.14 on the 10-minute chart. If the OEX can get past that on 10-minute closes, next resistance is at 575.48-575.78 on the 15-minute chart, on 15-minute closes.

Jeff Bailey : 12/7/2005 2:50:20 PM

Dell Computer (DELL) $31.65 -0.03% ... CFO saying computing market is "still pretty robust." U.S. business markets are "fine." Q4 notebook PC sales for industry should be strong.

Jeff Bailey : 12/7/2005 2:44:17 PM

American Airlines (AMR) $19.29 +2.88% ... DJ - A U.S. federal Air Marshal fired a gun on an American Airlines plane after a disturbance, media reports said.

One person was reported to have been injured, according to the Web site of the Miami Herald.

MSNBC reported that the Air Marshal fired after a passenger claimed to have a bomb. The plane is now on the ground at the Miami-Dade airport.

The plane had just arrived from Colombia and was headed to Orlando, the reports said.

Airport and Miami-Dade County police officials said they had no immediate comment.

Jonathan Levinson : 12/7/2005 2:38:23 PM

Stepping away.

Jonathan Levinson : 12/7/2005 2:38:08 PM

Headline:

2:37pm AMR SHOTS FIRED ABOARD AMERICAN AIR PLANE FROM COLOMBIA -REPORTS

Jonathan Levinson : 12/7/2005 2:35:14 PM

Stepping away for a few minutes.

Linda Piazza : 12/7/2005 2:32:55 PM

OEX now at the bottom of a descending regression channel off the 11/23 high. There's a nice fit on that channel, so we're again approaching a potential bounce point this afternoon. If you've got profits, keep lowering your stops with bounce potential still there.

Linda Piazza : 12/7/2005 2:31:13 PM

New low of the day for the OEX. Barring a quick bounce, it appears to be headed toward the 573.67 target on its 15-minute chart.

Linda Piazza : 12/7/2005 2:28:19 PM

The OEX can't bounce much, getting knocked by by resistance now at 574.81 on 10-minute closes, but it's not staying beneath those 11/29 and 12/01 lows, either. It's a draw here between bulls and bears. They're going to get ti sorted out for a short-term move, but the direction is unclear as yet. The TRAN is still trying to create that intraday double-bottom formation and that may be key, as to whether it can do that or not.

Jonathan Levinson : 12/7/2005 2:25:18 PM

QQQQ keeps on getting hammered on its bounce attempt, but it's holding above the 41.63 low that stopped out our 41.69 long play. The wavelet oscillator hasn't yet reversed from its upphase, while the short cycle oscillators are flat just above oversold territory: Link

Jeff Bailey : 12/7/2005 2:21:46 PM

02:00 Internals found at this Link

Linda Piazza : 12/7/2005 2:21:02 PM

The TRAN is trying to create a double-bottom formation today. Be careful here, bears. Everything has been going your way, but don't let gains get away from you. It's not my expectation at this point that we'd see a big surge into the close, but stranger things have happened.

Linda Piazza : 12/7/2005 2:19:41 PM

The OEX is holding just above the 11/29 and 12/01 lows. If it does this too long, bulls are going to try buying the dip. I don't know that they'd be able to push the OEX too high in today's climate, but be aware of the possibility. Those lows were at 574.55 and 574.56. The OEX is at 574.68. I actually would expect some kind of bounce attempt here, perhaps up to 575.70-576.15 or so. If the OEX crashes through 574.55 and stays there, that small bounce expectation is called off, though.

Jonathan Levinson : 12/7/2005 2:14:45 PM

Volume breadth recovers to -2.1:1 on the NYSE, -1.3:1 on the Nasdaq, still weak.

Jane Fox : 12/7/2005 2:14:08 PM

This is not as bearish as we have seen on some days but it is getting close. Link

Jonathan Levinson : 12/7/2005 2:13:31 PM

Headline:

2:12pm HOUSE PASSES EXTENSION OF ALTERNATIVE MINIMUM TAX RELIEF

Jeff Bailey : 12/7/2005 2:08:49 PM

02:00 Market Watch found at this Link

Linda Piazza : 12/7/2005 2:05:42 PM

TRAN testing the day's low, with 4100 round-number support just below that. TRAN at 4109.64 as I type, previous low at 4109.82.

Jeff Bailey : 12/7/2005 2:04:43 PM

SPX / SPY Options Montage at this Link ... I wasn't, nor will I be, willing to pay this morning's earlier quote (ask) for the SPX 1,250 Puts (SZP-XJ).

However ... Let's Swing trade put alert for two (2) of the SPX Dec. 1,250 Puts (SZP-XJ) at a limit price of $3.60. Would follow with a stop of $1.80 if filled, then target that strike of 1,250.

Jonathan Levinson : 12/7/2005 2:04:19 PM

QQQQ - Exit Point Alert -

Stopped out QQQQ long, -.06.

Linda Piazza : 12/7/2005 2:04:11 PM

OEX testing the 11/29 and 12/01 lows. Careful here. The OEX has a downside target much lower, at 573.79 and it can get pushed lower, too, but you want the OEX to keep pushing toward it.

Jonathan Levinson : 12/7/2005 2:03:51 PM

Volume breadth is down to -2.25:1 on the NYSE, -1.5:1 on the Nasdaq.

Linda Piazza : 12/7/2005 2:00:48 PM

As a reminder, the OEX's 11/30 low was 574.55, so the OEX quickly approaches that potential double-bottom level. If in bearish positions, you want the OEX to crash right through that, but if you haven't taken partial profits, now might be a time to consider doing so, following the OEX lower with your stops.

Linda Piazza : 12/7/2005 1:58:55 PM

The SOX is still sliding down along descending Keltner support, now at 497.38-497.85 on 15-minute closes, not breaking through it completely yet, but pushing it lower. SOX at 497.68 as I type.

Jonathan Levinson : 12/7/2005 1:53:24 PM

QQQQ - Entry Point Alert -

Long QQQQ at 41.69 stop 41.63

Jonathan Levinson : 12/7/2005 1:48:58 PM

A test of QQQQ 41.70 should generate a bullish divergence at what should be a 30 min channel low, as well as testing channel support just above S2. Link

Linda Piazza : 12/7/2005 1:47:21 PM

The SOX has only barely broken below that rising trendline off the 11/29 low. It hasn't confirmed a new low, instead holding to Keltner support that's sinking lower along with the SOX. That support is now at 497.91-498.06 on 15-minute closes, with resistance now at 499.20-499.30 on 15-minute closes. The SOX's formation still looks like a potential "b" distribution pattern, but it needs to break lower out of the bulb part of the "b" at the bottom of the decline, or bulls are going to try to run it up. SOX at 498.47 as I type.

Linda Piazza : 12/7/2005 1:43:54 PM

If the VIX were an equity, we'd be talking about how it just invalidated a potential H&S at the top of the day's climb.

Linda Piazza : 12/7/2005 1:39:01 PM

The SPX tests Keltner support that's held other than a brief dip below it since early October, with that at 1256.24 on 30-minute closes. SPX at 1256.41 as I type. A bounce up to retest the 1260.58 resistance on 30-minute closes might be expected unless there's going to be a cascade-lower afternoon, which remains a possibility. Bears want that resistance to hold, if there is a bounce.

Linda Piazza : 12/7/2005 1:35:33 PM

Back. I see that the TRAN broke down out of its bear flag climb after the steep drop into today's low. It has not yet confirmed its breakdown by a new low, but bears are relieved to see anything to the downside on the TRAN, threatening earlier to break to the upside out of its pullback off last month's high.

The OEX has now set a downside target of 573.90 on its 15-minute chart, but only as long as it maintains 15-minute closes beneath 576.52-576.90. Bears would prefer that Keltner resistance at 575.92 hold on 15-minute closes. Do not count on that downside target being hit. Do use it to figure out places when you will want to protect bearish profits, perhaps by stepping out of part of your positions as it's approached. The November 30 low is at 574.55, and there will likely be a concerted effort by bulls to protect that low. OEX at 575.45 as I type.

Jonathan Levinson : 12/7/2005 1:34:33 PM

QQQQ tests rising support connecting Monday's lows: Link

Jane Fox : 12/7/2005 1:31:33 PM

TICKS -800 and the bears are gaining momo.

Jonathan Levinson : 12/7/2005 1:26:58 PM

QQQQ breaks back to 41.80, breaking below as I type. 30/60 min channel support is at 41.72: Link

Jonathan Levinson : 12/7/2005 1:24:24 PM

Volume breadth -1.5:1 on the NYSE, 1:1 on the Nasdaq.

Jeff Bailey : 12/7/2005 1:14:47 PM

01:00 Internals found at this Link

Jonathan Levinson : 12/7/2005 1:06:17 PM

Foreign central banks took a strong 5.7B of the 13B 5-year note auction. The high yield was 4.435%, the median yield 4.4%, with 2.38 bids tendered for each awarded.

Jeff Bailey : 12/7/2005 1:02:49 PM

01:00 Market Watch found at this Link

Jonathan Levinson : 12/7/2005 1:01:01 PM

The month code for March is "H". And, don't forget to update the year to "06" as well ;)

Jeff Bailey : 12/7/2005 12:54:12 PM

Sell Program Premium ... DIA $108.47, SPX 1,260.81, QQQQ $41.89

Jonathan Levinson : 12/7/2005 12:52:21 PM

The Treasury auctioned 11B in 7-day cash management bills today, at which foreign central banks took a light 750K of the total. The high rate was 4.08%, the yield 4.14%, and this may have prompted Greenspan's comment about an inverted yield curve not being indicative of economic weakness- though it could indicate excessive Treasury borrowing via short-dated debt. The bid to cover was a strong 3.05, however. We await the results of the 5 year note auction during the next 10 minutes.

Jonathan Levinson : 12/7/2005 12:47:02 PM

It's rare to see the Qs consolidating in a narrow sideways range at lows instead of highs, but the 7 ceent sideways range since 11 is reminiscent of all the sideways drifts we've been watching through November. With TXN and INTC's updates hanging over the market, it's understandable that big money might hesitate before jumping in to break the range. Currently, a short cycle upphase is getting no traction since kicking off just past 11, but it's only half done. Above 41.90, the 72 SMA will have been violated to the upside for the first time today, giving a bullish bias to the 30 min cycle. Link

Linda Piazza : 12/7/2005 12:41:47 PM

I have to go now. The OEX so far still finds resistance at the 15-minute 10-sma and hasn't even risen to test the 21-ema on that chart. So far, there's nothing too alarming for bears there, and they're comforted by the VIX's action, although the VIX now reaches resistance. There's reason for concern, however. The TRAN's bounce is taking it up to test the 61.8% retracement of the decline off yesterday's afternoon high, with that at about 4145.51, with the TRAN currently at 4142.74.

Jonathan Levinson : 12/7/2005 12:33:22 PM

Ten year note yields conitnue their slow rise, now up 3.3 bps to 4.527%, IRX creeping back to a .3 bp gain at 3.935%.

Linda Piazza : 12/7/2005 12:31:20 PM

TRAN still in a corrective-looking climb, but market bears don't want to see it climb above 4160-4170, since that would suggest an upside break out of a potential bull flag off its record high. TRAN at 4140.67 as I type.

Linda Piazza : 12/7/2005 12:29:57 PM

SOX is testing 15-minute Keltner resistance, up to 499.76 on 15-minute closes. SOX at 499.56 as I type. That rising trendline off the November 29 low is at about 499.22, if I've placed my cursor correctly. Still no resolution here, although bulls are certainly trying.

Linda Piazza : 12/7/2005 12:27:44 PM

SPX's 10-sma at 1221.66, with the SPX currently at 1260.27.

Linda Piazza : 12/7/2005 12:26:15 PM

I'm going to have to leave the house in about 15 minutes for an appointment. It's sleeting here. Since I grew up in Port Arthur, driving in sleet is not part of my driving repertoire. If I never return, it's not because I didn't want to come back!

Linda Piazza : 12/7/2005 12:24:08 PM

Unless the OEX can be pushed quickly to a new low and kept there, it looks likely to rise toward 577.55-577.74 resistance, this on three-minute closes.

Linda Piazza : 12/7/2005 12:21:04 PM

SPX dropping below its 10-sma and its 60-minute 50-sma, testing the 60-minute 72-ema at 1258.56. The SPX has not dropped below Monday's 1258.12 low, with today's low at 1258.93. The current value is 1259.52.

Jonathan Levinson : 12/7/2005 12:20:50 PM

Headline:

12:18pm GREENSPAN: FLAT YIELD CURVE NOT ALWAYS SIGN OF WEAK ECONOMY

Jeff Bailey : 12/7/2005 12:19:50 PM

SPX 1,258.93 -0.37% ... good gravy ... Dec. 1,250 puts (SZP-XJ) are bid/offer $4.60 x $5.40. BIG spread

Jane Fox : 12/7/2005 12:19:04 PM

These two are in sync today. Link

Jonathan Levinson : 12/7/2005 12:18:03 PM

QQQQ is back to the low but with a bullish wavelet divergence. If the current lows hold, this should be good for a long entry to try to capture the anticipated 30 min cycle upphase. Link

Linda Piazza : 12/7/2005 12:17:59 PM

No new low on the OEX, but it's again testing Monday's low. OEX at 576.91 as I type. The 15-minute formation begins to look like a falling wedge, a typically bullish formation, so bears really need to press this lower.

Linda Piazza : 12/7/2005 12:16:37 PM

SOX getting squeezed right, trading in a tiny range between potential support and potential resistance. Such a formation after a steep decline looks like a potential "b" distribution pattern, but the SOX has to break lower to confirm that. Bearish formations haven't been known for their strong reliability lately.

Jane Fox : 12/7/2005 12:16:29 PM

AD volume did indeed make a new daily low so all bullish bets are off.

Jeff Bailey : 12/7/2005 12:15:36 PM

12:00 Internals found at this Link

Marc Eckelberry : 12/7/2005 12:08:19 PM

Jan QQQQ puts should exit at QQQQ 41.25 / 41.30.

Linda Piazza : 12/7/2005 12:08:22 PM

The first OEX Keltner resistance at 577.81 has held up as resistance, and now the OEX retests support again, at 576.92-577.10 on 15-minute closes. Bears need to see a new low, with the OEX soundly breaking through Monday's 576.86 low. OEX at 577.22 as I type.

Jeff Bailey : 12/7/2005 12:06:30 PM

12:00 Market Watch found at this Link

Linda Piazza : 12/7/2005 12:05:19 PM

The SOX is still being squeezed between the ascending trendline off the November 29 low and the 15-minute Keltner resistance, up to 499.94 on 15-minute closes. SOX at 499.10 as I type.

Jane Fox : 12/7/2005 12:04:48 PM

AD volume is trying for new daily lows and if it is not able to make them I think the bulls have won another round.

Linda Piazza : 12/7/2005 12:02:24 PM

The TRAN is still climbing. It's at 4142.23, and market bears have got to be nervously eyeing its climb within a possible bull flag pullback off the November highs. QCharts sets the top of its flag at about 4160. The actual descending trendline off that November high is at about 4170, if I placed my cursor correctly.

Jeff Bailey : 12/7/2005 12:03:36 PM

US Dollar Index (dx00y) 91.85 +0.44% ... traded well above today's DAILY R2. May keep equity bears on the sidelines, or hint of foreign capital inflows.

Amex Gold Bugs ($HUI.X) 262.01 +2.41% ... mirror's dollar's strength.

Remember when dollar up = gold down? In recent weeks/months, they have moved in unison.

Dynamic markets for sure. Keeps a trader/investor on their toes.

Jeff Bailey : 12/7/2005 11:57:40 AM

SPY 126.51 -0.24% ... its session low has been .... 126.29.

Jeff Bailey : 12/7/2005 11:56:46 AM

Sell Program Premium ... SPX 1,261.04

Jeff Bailey : 12/7/2005 11:56:29 AM

SPX session low has been 1,259.01

Jeff Bailey : 12/7/2005 11:55:30 AM

S&P 500 Index (SPX.X) 1,261.32 -0.18% ... edges back above WEEKLY Pivot here.

Jonathan Levinson : 12/7/2005 11:54:53 AM

Volume breadth is -1.25:1 on the NYSE, +1.04:1 on the Nasdaq.

Linda Piazza : 12/7/2005 11:51:10 AM

This current OEX rise still looks bear-flag-like on the 15-minute chart. Bears want to see the Keltner resistance now at 577.93 hold on 15-minute closes. That line courses lower so the OEX should hit it at a lower level than that it's currently measuring. It's possible that there will instead be another swing up to retest all those trendlines near 578.75, although I think the OEX has thoroughly tested them. And you know it's possible that bulls will get tired of waiting around and just spike it all higher again.

Tab Gilles : 12/7/2005 11:47:04 AM

Eaton Vance Limited Duration Income Fund (EVV) as per 11/28 post 11:29 AM;

That long legged doji on the weekly chart looks to have been the bottom. Link Link Link

Jonathan Levinson : 12/7/2005 11:43:14 AM

Headlines

11:42am GERMANY'S DAX DOWN 0.6% AT 5,266 AS TRADE ENDS

11:42am FRANCE'S CAC 40 DOWN 0.4% AT 4,660 AT FINISH

11:42am U.K.'S FTSE 100 SHEDS 0.2% TO 5,528 AT CLOSE

Jonathan Levinson : 12/7/2005 11:41:04 AM

QQQQ's bounced from its 41.80 support line, but the bounce has been slow, and the short cycle indicators still refuse to turn up. A wavelet bounce is approaching overbought territory, and bulls will need to see a break above 41.98 to confirm this as anything more than another corrective bounce. Link

Linda Piazza : 12/7/2005 11:41:02 AM

The TRAN still climbs off its low, with that low coinciding with 15-minute Keltner support hit right after the open. The TRAN is testing the 50% retracement off the decline from yesterday's late-day high into this morning's low, with that 50% retracement at about 4138.86 and with the TRAN currently at 4137.37. The 61.8% retracement is at 5145.77. There's Keltner resistance at 4141.91 on 15-minute closes, but stronger Keltner resistance is up at 4154.33.

Jane Fox : 12/7/2005 11:38:58 AM

I am not buying this bullishness literally or figuratively. I need more evidence from the ADs.

Jane Fox : 12/7/2005 11:39:26 AM

TICKS +800, another hint of bullishness.

Linda Piazza : 12/7/2005 11:37:14 AM

Advdec line bouncing from support just hit about 20 minutes ago, complete with bullish value/RSI diveregence. Bears would like to see about -900 hold as resistance on 10-minute closes. Advdec line at -1187 as I type.

Linda Piazza : 12/7/2005 11:35:29 AM

Studying the SOX's chart and the H&S that I think was confirmed there right after the open (there could be two versions), the downside target appears to be at about 495. Bears would like to see the five-minute 21-ema at 499.96 hold on five-minute closes.

Jeff Bailey : 12/7/2005 11:33:08 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 12/7/2005 11:29:56 AM

The SOX has broken below 15-minute Keltner support, but is now poised on the rising trendline off the November 29 low, with that trendline at just about the current 498.38 SOX level. Bears would like to see the SOX stay below 499.33 on 15-minute closes, and then break below that trendline.

Jeff Bailey : 12/7/2005 11:29:16 AM

EIA Weekly Diesel, Jet Fuel Table found at this Link

Linda Piazza : 12/7/2005 11:28:08 AM

The OEX is springing up from that Keltner support, but it's so far weak-looking support. If the OEX keeps climbing, bears would like to see it find resistance below 578.21 on 15-minute closes. OEX at 577.16 as I type, still roughly testing Monday's low.

Jane Fox : 12/7/2005 11:24:13 AM

THE VIX is supporting the bearishness. Link

Linda Piazza : 12/7/2005 11:21:05 AM

The OEX tests Monday's low, with that low at 576.86 and with the OEX currently at 576.77. This would be another potential bounce point, so bears need to know how much of a bounce they'll endure, following the OEX lower with their stops. However, matters begin to look even more favorable for bears if the OEX can't mount an effective bounce--a spring higher--soon.

Jonathan Levinson : 12/7/2005 11:17:18 AM

Stepping away for a few minutes.

Jonathan Levinson : 12/7/2005 11:17:00 AM

Session low for crude oil at 59.625 here, natgas still up .17 at 13.66.

Linda Piazza : 12/7/2005 11:16:31 AM

The TRAN is coiling back and forth across 4130-ish S/R. Keep an eye on the TRAN, because it hasn't reached a new low like some other indices.

Linda Piazza : 12/7/2005 11:15:24 AM

VIX still climbing, as Jane has probably mentioned. VIX at 11.89 as I type.

Jeff Bailey : 12/7/2005 11:14:16 AM

11:00 Internals found at this Link

Yesterday's Internals found at this Link

Linda Piazza : 12/7/2005 11:14:23 AM

Advdec line now at a new low, approaching possible support near -1630, with the advdec line at -1446 as I type.

Linda Piazza : 12/7/2005 11:13:20 AM

Looking at daily charts of the Dow, SPX and OEX, I still just see coiling. The OEX perhaps looks a little weaker than the others with respect to its position with regard to its 10-sma, but none are even below Monday's low yet. So, although bearish trades have so far worked and there's the possibility for further declines and even a breakdown, there's nothing that screams that it's definitely going to happen. In fact, this might be a good point for bears to consider taking partial profit, depending on when an entry was made, but certainly if it was made at or near yesterday's 3:00 tumble.

Jonathan Levinson : 12/7/2005 11:11:37 AM

The Fed has just announced a 28 day repo, the first I've seen in a long time, and this one is deliverable tomorrow in the amount of 5B. Note that the stopout rate was 4.06%, showing rising demand for the Fed's money.

Jonathan Levinson : 12/7/2005 11:07:57 AM

Volume breadth 1.4:1 on the NYSE, -1.2:1 on the Nasdaq- nowhere near as strong as the upside readings we had yesterday morning and early afternoon.

Jeff Bailey : 12/7/2005 11:04:38 AM

11:00 Market Watch found at this Link

Linda Piazza : 12/7/2005 11:03:18 AM

OEX bears need to see the OEX drop below Monday's 576.86 low.

Tab Gilles : 12/7/2005 11:03:01 AM

Nasdaq100 ($NDX) Here's a chart of the NDX into the yearend of '04. Link

Then 4 months later... Link

Here we are currently... Link

Is the $NDX rolling over? Link

I believe so, having hedged with the USPIX fund.[see 12/1 12:43 AM & 12/1 7:15 PM posts]

Although the daily and weekly $NASI have yet to signal a sell. As I've stated in past posts a pullback is possible. Link Link

Watch NDX 1735 Link

Jonathan Levinson : 12/7/2005 11:02:59 AM

QQQQ is now testing Monday's range support at 41.80, as the 30 min channel bottom falls to 41.75, still within that confluence. My guess is chop here, as the short cycle upphase stalls but does not reverse within the aging 30 min downphase. A plunge through these levels would be very bearish, and would let the daily cycle bears loose. Link

Linda Piazza : 12/7/2005 11:02:09 AM

New low for the OEX, and it's breaking below the Keltner support that usually contains it. Officially, this creates a breakdown with a new signal, at 574.22, but the OEX has not been good about meeting breakdown targets, particularly out of this channel. The OEX is rising right now to retest that Keltner channel.

Jeff Bailey : 12/7/2005 11:01:11 AM

SPX / SPX Option Montage found at this Link ... 5-minute interval chart.

Linda Piazza : 12/7/2005 10:59:12 AM

That OEX resistance did hold, and now the OEX has dropped back to test 577.47-577.53 Keltner support on a 15-minute closes. OEX at 577.45 as I type.

Jeff Bailey : 12/7/2005 10:57:40 AM

Sell Program Premium ... DIA $108.42, SPX 1,260.63, QQQQ $41.85

Jonathan Levinson : 12/7/2005 10:55:21 AM

Session low for NQ, QQQQ 7 cents above its 41.80 low, but the short cycle has not yet lost its upphase: Link

Linda Piazza : 12/7/2005 10:54:12 AM

SOX below 500, testing 15-minute Keltner support. Keep the SOX on your radar screen. That 15-minute support is at 499.37-499.44 on 15-minute closes, with the SOX at 499.77 as I type. There's bullish price/RSI divergence on that chart, so bears be warned to keep following your semi-related positions lower with your stops. However, if the SOX should break through this support, that might carry the other indices lower, too.

Linda Piazza : 12/7/2005 10:52:11 AM

The OEX's climb is an expected one, up to test a trendline off the December 1 low and the one off the 11/23 high: trendlines the OEX broke through this morning. The climb looks corrective. The VIX has broken out of a 15-minute Keltner channel that often contains prices and is above this week's high, at 11.69 as I type. But what's wrong with the TRIN? It's plunged, so should we trust the VIX? I don't trust anything lately, unable to find anything other than "go long" that has worked consistently. All I can say so far is that if this were a normal market, the OEX is behaving in such a way that you would expect it turn lower again after it completes a test of overhead resistance. OEX at 578.51 as I type.

Jeff Bailey : 12/7/2005 10:48:33 AM

EIA Weekly Gross Inputs, Operable Capacity, Percent Utilization Table found at this Link

Jonathan Levinson : 12/7/2005 10:48:22 AM

Ten year note yields are back up to a 2.1 bp gain at 4.515%, steepening against the 13-week rate which is down to flat at 3.932%.

Linda Piazza : 12/7/2005 10:44:27 AM

The SOX is still sliding down along the descending trendline off Monday's high, maintaining it as support, but not yet moving higher. It's still within the boundaries of a right shoulder for a H&S with a neckline at about 500.07 currently. Fifteen-minute Keltner support at 499.36-499.57 looks fairly firm and is so far supporting the SOX. Without a strong downdraft, it's possible that we'll see a bounce, at least up to 502.83, but so far, five-minute resistance at 501.53 on five-minute closes still holds. There's the usual battle going on here, but unless bears can push this down and confirm the H&S soon, probably within the next 15-20 minutes, the formation will likely be invalidated and bulls might gain confidence and send it higher again. SOX at 501.07 as I type.

Jonathan Levinson : 12/7/2005 10:44:11 AM

So far, what should be a strong bounce is spinning its wheels, just chopping sideways. What bulls need to see is an pause in the 30 min cycle downphase, because the short cycle upphase is still fighting its downward current. The 72 SMA is down to 42.10 QQQQ, and above that level, the 30 min channel should begin to rise: Link

Linda Piazza : 12/7/2005 10:40:02 AM

The OEX is rising again to test that descending trendline off the 11/23 high with that trendline near the first Keltner resistance at 579.06 on 15-minute closes. Below that is the rising trendline off the December 1 low, nos at about 578.64. As I type, the OEX is at 578.81.

Jeff Bailey : 12/7/2005 10:39:23 AM

EIA Weekly Crude Oil, Gasoline, Distillate Table found at this Link

Linda Piazza : 12/7/2005 10:35:12 AM

Spike higher in the advdec line post inventories has been reversed. So far. Don't count on anything today.

Linda Piazza : 12/7/2005 10:34:36 AM

TRAN climbing strongly, just breaking above the three-minute Keltner resistance that formed resistance yesterday after the TRAN began tumbling at 3:00 with other indices. That resistance was near 4120 on three-minute closes, tested earlier this morning and holding, but not holding now. TRAN at 4125.69, perhaps due to pull back in a new rising regression channel and retest that former resistance, seeing if it holds as support.

Jonathan Levinson : 12/7/2005 10:32:55 AM

Crude oil -.075 to a session low of 59.875.

Linda Piazza : 12/7/2005 10:31:36 AM

Advdec line, SPX and OEX all sport potential inverse H&S's on the bottoms of their five-minute charts.

Jonathan Levinson : 12/7/2005 10:31:22 AM

QQQQ bounces from a higher low, the wavelet downphase aborting early and suggesting strength in the upturning short cycle indicators: Link

Jonathan Levinson : 12/7/2005 10:30:17 AM

From the EIA website:

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) rose by 2.7 million barrels from the previous week. At 320.3 million barrels, U.S. crude oil inventories are well above the upper end of the average range for this time of year. Total motor gasoline inventories also increased by 2.7 million barrels last week, putting them in the lower half of the average range. Distillate fuel inventories climbed by 2.7 million barrels, as well, last week, and are in the middle of the average range for this time of year. Increases were seen in both high-sulfur (heating oil) and low-sulfur (diesel fuel) distillate fuel inventories. Total commercial petroleum inventories rose by 5.8 million barrels last week, and are just above the upper end of the average range for this time of year.

Jeff Bailey : 12/7/2005 10:30:08 AM

SPX & Option Montage found at this Link ... Same 60-minute interval chart reviewed last night.

Jonathan Levinson : 12/7/2005 10:28:56 AM

Crude oil is +.5 at 60.45 with 2 minutes until the EIA report.

Jonathan Levinson : 12/7/2005 10:27:26 AM

Headline:

FAA SAYS AIRCRAFT WAS MILITARY PLANE DISPERSING FLARES

Jonathan Levinson : 12/7/2005 10:24:35 AM

Updated story on CBC.ca: Link

Jonathan Levinson : 12/7/2005 10:24:12 AM

Headline:

10:23am FAA: REPORT OF NEW BRUNSWICK, CANADA PLANE CRASH INCORRECT

Linda Piazza : 12/7/2005 10:22:54 AM

There are lots of "maybe" bearish formations today, but if you're in a bearish position remember how infrequently those maybe's are realized lately and that crude inventories could change the tenor of trading today.

Jonathan Levinson : 12/7/2005 10:22:32 AM

Session high for Feb. gold at 520.10, +6.20.

Jonathan Levinson : 12/7/2005 10:22:05 AM

Awaiting the EIA petroleum report in 8 minutes.

Linda Piazza : 12/7/2005 10:21:45 AM

The OEX also has a rough H&S-ish formation on its 15-minute chart, with a neckline that descends so steeply that I'm not sure the formation is valid, paritcularly since it occurs mostly during a consolidation period. However, that neckline is at about 577 currently for those who want to watch it. OEX at 578.26 as I type.

Jeff Bailey : 12/7/2005 10:18:31 AM

10:00 Internals found at this Link

Linda Piazza : 12/7/2005 10:17:43 AM

SPX still maintains its 10-sma support.

Linda Piazza : 12/7/2005 10:17:15 AM

Advdec line so far finding resistance at the first resistance level, but there's been no confirmation by a new low, and the inventories number could change everything.

Jeff Bailey : 12/7/2005 10:17:09 AM

Sell Program Premium ... DIA $108.48, SPX 1,263.15, QQQQ $41.93

Linda Piazza : 12/7/2005 10:16:10 AM

SOX headed down toward that neckline again for the H&S that I mentioned, but this is always a moment of particular danger for bears in a bullish environment. Neckline now at 500.19, with the SOX at 501.11. There's 15-minute Keltner support beneath the neckline, however, so be careful.

Jonathan Levinson : 12/7/2005 10:10:54 AM

Volume breadth is +1.1:1 on the NYSE, +1.55:1 on the Nasdaq.

Linda Piazza : 12/7/2005 10:10:50 AM

There's the potential for a H&S on the SOX's five- and ten-minute charts, or perhaps one ha salready been confirmed, neckline at about 503, with the SOX currently at 502.34, rising to test it. The chart could be read either way, but if there's still one in the making, the neckline descends and is now at about 500.25 with the right-shoulder level at about 503. A rise much above 505 or maybe 505.40 would appear to invalidate the formation. A drop below 500 would appear to confirm it, although I'd want to see a 15-minute close beneath the gathered support at 499.31-499.74 before I was too convinced. Even then, bears should be on guard near 493-495 for another potential rise into a right shoulder for a bigger H&S.

Jonathan Levinson : 12/7/2005 10:09:58 AM

QQQQ struggles with short cycle channel resistance here on the wavelet bounce. A break above 42 should be enough to signal an upturn in the short cycle oscillators. Link

Jeff Bailey : 12/7/2005 10:07:16 AM

10:00 Market Watch found at this Link

Linda Piazza : 12/7/2005 10:05:40 AM

The OEX is below the rising trendline from the December 1 low, with that trendline at about 578.52 currently, just below the descending trendline off the 11/23 high, with that at about 579.10 currently. There's Keltner resistance gathering above that, but enough above it that it looks as if the OEX could move back above those two trendlines by a bit or maybe just retest them, as it rose to do while I was typing.

Jonathan Levinson : 12/7/2005 10:04:54 AM

Headlines:

JAN CRUDE CLIMBS 61C TO $60.55/BRL AHEAD OF U.S. SUPPLY DATA

JAN NATURAL GAS UP 37.1C, OR 2.8%, AT $13.86/MLN BTUS

Linda Piazza : 12/7/2005 10:03:40 AM

Like many other indices, the RUT is at 15-minute Keltner support from a channel that often (but less surely than on other indices) contains prices. It's trying to maintain that support, at 685.83 on 15-minute closes, with the RUT at 686.41. There's bullish price/RSI divergence at this swing low, but the supporting trendline begins to slant lower, perhaps lessening its effectiveness as support.

Jane Fox : 12/7/2005 10:03:31 AM

AD line is -370 and AD volume is below 0 so the bears have the reins but this is not what you would call a firm grip.

Jonathan Levinson : 12/7/2005 10:01:33 AM

Here's more on the plane story: Link

Jonathan Levinson : 12/7/2005 10:01:09 AM

Headline:

PLANE CRASHES IN NEW BRUNSWICK, CANADA: CBC

Jeff Bailey : 12/7/2005 10:00:58 AM

3M (MMM) $78.00 +0.38% Link ... Names George Buckley as new chairman and chief executive. Mr. Buckley was chairman and chief executive at Brunswick, which named Dustan McCoy as his successor.

Jonathan Levinson : 12/7/2005 10:00:54 AM

Ten year bonds are firming again, TNX down to a .6 bp gain at 4.5% and IRX holding +1 bp at 3.942%.

Linda Piazza : 12/7/2005 9:58:52 AM

The SPX still maintains its 10-sma at 1261.64, although it did pierce it this morning. SPX at 1262.58 as I type. The OEX is again below its 10-sma at 579.28, with the OEX at 578.05, right inside that long-term S/R band on my charts. Without a strong push down, it's going to be difficult to get the OEX through that band to the downside.

Linda Piazza : 12/7/2005 9:56:34 AM

The TRAN bounces, but its bounce looks corrective so far. SOX, another index leading to the upside, is now at 500.44, testing key support, near its low fo the day and not yet bouncing effectively.

Jonathan Levinson : 12/7/2005 9:55:30 AM

QQQQ's short cycle indicators are bottomy, and the wavelet downphase is also oversold. A bounce from a nominally higher low here would be the first sign of support for intraday bulls, but they'll need to clear 42 to set up a test of the 72 SMA at 42.17: Link

Jonathan Levinson : 12/7/2005 9:54:06 AM

The Fed added 4.25B via overnight repo with no expirations, for a net add in that amount. The highest rate submitted was 4.01%, the stopout 4%, right on the overnight target rate and showing a slight increase in demand for the money on the part of the Fed's dealers.

Linda Piazza : 12/7/2005 9:53:17 AM

Advdec line may be trying to bounce, too. It looks as if there's significant resistance back near and just above that mid-line level, beginning at about 50 but extending up to 430 or so. Bears would rather see resistance found sooner, though. Advdec line at -859 as I type. Don't take anything for granted in this climate.

Linda Piazza : 12/7/2005 9:51:42 AM

SOX approaching 15-minute Keltner support at 499.26-499.85 on 15-minute closes, with the SOX currently testing 500 and the descending trendline off the December 2 high. Unless this is going to be a cascade-lower type day, this is one point from which a bounce attempt might be expected. I'm just not certain how successful it will be.

Linda Piazza : 12/7/2005 9:50:02 AM

OEX trying to steady at that 15-minute Keltner support. Next resistance now at 578.25 on 15-mintue closes, but strongest 15-minute resistance is still up there near 569.57-580.12. That's beginning to firm up, but all it takes is one of those zooms we've been getting.

Linda Piazza : 12/7/2005 9:48:31 AM

The OEX is now retesting that 15-minute Keltner support at 577.87 on 15-minute closes, with the OEX at 577.73. It's showing bullish price/RSI divergence with respect to Monday's test, but as long as the OEX is dropping, follow it lower with your stops. I may be called away again this morning--with these frequent needs to be away one reason that I'm going to take some time away from the Monitor after next week--so I again can't call a play, but would have likely done so when the advdec line tested resistance and fell away. I'd be really antsy about a bearish play, however. So far, so good.

Jeff Bailey : 12/7/2005 9:48:31 AM

Sell Program Premium ... DIA $108.26, SPX 1,261.06, QQQQ $41.88

Jonathan Levinson : 12/7/2005 9:45:48 AM

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

Linda Piazza : 12/7/2005 9:45:26 AM

The OEX has also just dropped below its 60-minute 72-ema. The SPX has dropped to test its 60-minute 50-sma, but hasn't confirmed by dropping below its 60-minute 72-ema at 1258.46. Some key levels are being tested and/or violated.

Linda Piazza : 12/7/2005 9:43:46 AM

The TRAN has just dropped to test the 60-minute 72-ema. Although spent some time below this earlier in the month and then bounced back, it does appear to have some relevance.

Linda Piazza : 12/7/2005 9:42:42 AM

TRAN dropping more strongly now.

Linda Piazza : 12/7/2005 9:42:24 AM

SPX sitting just above the 10-sma at 1261.63, with the SPX at 1262.52.

Jonathan Levinson : 12/7/2005 9:42:05 AM

The SOX is breaking yesterday afternoon's low, currently trading 501.34, QQQQ holding 5 cents above the 41.90 low. Bulls need to see that level hold.

Linda Piazza : 12/7/2005 9:41:23 AM

Advdec tested the midline S/R and then fell, but is already at one potential support level, at -298. I see a possibility that the markets could chop downward today, but in the OEX's case, any movement down now would be a move into that 577-578.40 S/R zone. OEX at 578.46. I've got a bunch of alarms set this morning to tell me when some indices are breaking key support that I'd marked last night, but none of them are sounding as yet.

Linda Piazza : 12/7/2005 9:38:58 AM

The SOX tried punching higher this morning, but is now dropping, at 501.83 as I type. Potential support at 499.24-500.14 on 15-minute closes.

Jonathan Levinson : 12/7/2005 9:37:43 AM

Chop for QQQQ as the wavelet upphase battles the bottomy but ongoing short cycle downphase: Link

Linda Piazza : 12/7/2005 9:37:06 AM

OEX Keltner picture: The OEX is bouncing from the Keltner support that usually holds it, now at 578.03 on 15-minute closes, tested late yesterday. The RSI measured levels that indicated that it was time for a rise, too, which led to my feeling that a bounce attempt could be one scenario for the day. However, next resistance is at 579.65 and then at 580.21-580.27 on 15-minute closes, and that looks at least middling firm. Tough to tell with all this strange range-bound trading punctuated by a zoom here or there what might happen, but so far, it looks at least possible if not probable that the OEX could pause at that resistance.

Jonathan Levinson : 12/7/2005 9:36:28 AM

Ten year note yields hold a 1.5 bp gain at 4.509%. 13-week rates are up 1 bp to 3.942%.

Linda Piazza : 12/7/2005 9:34:15 AM

The TRAN often does some zooming one direction or the other pre-inventories numbers, but it's not doing much of anything at all. Nothing is, or else my charts are frozen.

Jonathan Levinson : 12/7/2005 9:31:48 AM

Volume breadth is +1.21:1 on the NYSE, +2:1 on the Nasdaq at the open.

Linda Piazza : 12/7/2005 9:31:14 AM

The advdec line starts out just below midline S/R but moves right up to test it. The OEX turns right up to test that descending trendline off the 11/23 high, with the OEX at 579.08 as I type.

Jonathan Levinson : 12/7/2005 9:31:08 AM

30/60 min channel resistance is at QQQQ 42.30-.35 , 72 SMA resistance 42.20, and 30/60 min channel support is in play at 41.95-42.05. Link

Linda Piazza : 12/7/2005 9:29:40 AM

I'm back.

Jonathan Levinson : 12/7/2005 8:40:14 AM

QQQQ's 30 min cycle downphase was stopped in suspended animation for most of yesterday until the afternoon plunge, while the 60 min cycle is only now on the cusp of a rollover. The short cycle indicators are oversold and looking for an upphase. This is a very tricky setup, and my best guess is for a corrective bounce to a lower higher to be followed by another break to a lower low as the daily cycle downphase gets going. That's just a guess, however, because the daily cycle is and has been trending, leaving the door open for a retest or break of yesterday's highs. Below this week's 41.62 low, that downphase will confirm, but above that, the conflicting intraday cycles could still yield an upside surprise.

Jonathan Levinson : 12/7/2005 8:22:38 AM

Session low for ten year notes at 108 11/16, TNX opening higher by 2.1 bps at 4.515%. IRX is flat at 3.932%.

Linda Piazza : 12/7/2005 8:12:33 AM

I have to leave. I should be back by the time the market opens, but I'm not 100% sure I will be.

Jonathan Levinson : 12/7/2005 7:54:41 AM

Closing chart of ten year note yields from yesterday, daily candles: Link

Jonathan Levinson : 12/7/2005 7:45:28 AM

From the MBA's website:

WASHINGTON, D.C. (December 7, 2005) - The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 2. The Market Composite Index - a measure of mortgage loan application volume was 656.7 -- an increase of 5.2 percent on a seasonally adjusted basis from 624.1, one week earlier. On an unadjusted basis, the Index increased 46.8 percent compared with the previous week but was down 6.1 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index increased by 4.0 percent to 495.1 from 476.2 the previous week whereas the Refinance Index increased by 7.0 percent to 1596.4 from 1484.3 one week earlier. Other seasonally adjusted index activity includes the Conventional Index, which increased 5.1 percent to 981.8 from 933.8 the previous week, and the Government Index, which increased 6.6 percent to 114.0 from 106.9 the previous week.

The four week moving average for the seasonally-adjusted Market Index is down 0.2 percent to 643.5 from 644.6. The four week moving average is up 1.6 percent to 480.4 from 473.0 for the Purchase Index while this average is down 3.1 percent to 1591.8 from 1642.4 for the Refinance Index.

The refinance share of mortgage activity increased to 41.0 percent of total applications from 39.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 33.1 percent of total applications from 33.0 percent the previous week.

Jonathan Levinson : 12/7/2005 7:44:27 AM

Equities are flat, ES trading 1265.25, NQ 1705.5, YM 10873 and QQQQ +.05 to 41.99. Gold is up 2.6 to 516.5, silver +.19 to 8.974, ten year notes -3/32 to 108 47/64, crude oil is up .425 to 60.375 and natgas is up .355 to 13.845.

We await the 10:30 release of the Petroleum report at 10:30, and at 3PM, Consumer Credit, est. 5B.

Linda Piazza : 12/7/2005 7:37:07 AM

Yesterday's OEX candle was bearish, just bearish, at least over the short term. However, no bearish signals have been trustworthy lately and I'm not certain this one is, either. Here's what happened: the OEX broke above that descending trendline off the 11/23 high and it ran higher, but it ran right into daily Keltner resistance and some decided to take profit in the big caps. By the close, it had fallen back near the opening value, below that descending trendline off the 11/23 high. In between, it had given bulls a good run, and, if any of you bulls kept raising your stops under the OEX, as warned, you still profited.

What now? The recent market leader, the SOX, moved up to test, exactly, the resistance of one version of a rising regression channel that began forming in mid-2004. However, it ended the day just above a 50% retracement of the day's range, so there's a mixture of evidence there. It's never good to see prices knocked almost 7.5 points off the day's high, but the SOX still hasn't printed a lower low since it began climbing off the October low; it remains above the 60-minute 72-ema at 490.31, one average from which it's been bouncing; and it hasn't yet closed that gap that I suspect could be an exhaustion gap. Bulls and bears in SOX stocks are looking ahead to a couple of important updates this week, including TXN's update this afternoon and INTC's mid-quarter update tomorrow after the close, so a lot of strange things can happen. INTC shows a potential H&S formation on its daily chart, still lacking a right shoulder, and a rise today into the 27-27.20 range would be consistent with such a formation. Such a rise would be likely to bounce the SOX, if it occurs.

The OEX itself ended the day just above that 577-578.40-ish S/R zone that I've had marked on my charts for years. That band is actually wider than that, but that's just the locus of the most opens, closes, highs and lows in this zone through the years. The OEX also ended the day right at the rising trendline off Monday's low and the one off the December 1 low. It ended the day trying to bounce from the 15-minute Keltner support of the channel that holds most moves, with that support now at 578.08 on 15-minute closes, but beginning to turn lower now and not looking particularly firm.

So, there's some evidence in favor of a bounce, but maybe actually a weak bounce, with some support weakening. I actually would have felt more strongly about bounce potential if the OEX had managed to stop at that descending trendline off the 11/23 high. Even then, the descent was not anything like a bull flag pullback, so I think there's the possibility, if not yet the probability, that the OEX could head lower right away today. If not, and if it does bounce, watch for potential resistance now at 579.22-579.66 on 15-minute closes and then at 580.33-580.50 on 15-minute closes.

Linda Piazza : 12/7/2005 5:32:43 AM

Good morning. The Nikkei gained in Wednesday's trading, but closed well off its high of the day. Most other Asian markets gained, and European markets are positive this morning. As of 5:20 EST, gold was higher by $2.00 to $515.80, and crude, up to $0.43 to $60.37. Gold is hitting levels not seen in two decades, and crude was perhaps reacting to a new al Qaeda video calling for an attack on oil facilities. More details about Asian and European markets follows in succeeding paragraphs.

Before the Japanese markets opened, figures were released showing that Japan's official reserves rose the first time in three months in November. In earliest trading, the Nikkei quickly rose into double-digit gains ahead of the 2:00 pm Tokyo time release of a leading economic index. Then the Nikkei dipped about 75 points off the high of the day, rose into that 2:00 release and then dove afterwards, closing near the low. It still managed a positive close, up 61.28 points or 0.40%, at 15,484.66. Since about midday on Monday, the Nikkei has been chopping in a range from about 15,425 to 15,560, with a few prices just outside that range.

Some of the price swings last night may have been related to different developments during the day. In early trading, techs reacted favorably to yesterday's raised price targets for AAPL and IBM. UBS raised AAPL's target and CSFB, IBM's. Exporters in general benefited from yesterday's economic numbers in the U.S., although Advantest and Tokyo Electron headed down in early trading after Goldman Sachs cut its rating on the two, and Matsushita Electric Industrial Co., manufacturer of Panasonic products, tumbled after it announced a recall of kerosene heaters. Banks gained after Mitsubishi UFJ Financial announced accelerated plans to repay the money the government lent to it. After the open, news hit the wires that Prime Minister Fukui and the Bank of Japan's Governor Koizumi would meet at noon. The government and the Bank of Japan have not always agreed on monetary policy issues, with the government wanting the BOJ to be cautious about ending quantitative easing and differing over whether the CPI or the GDP deflator should be used to determine when Japan's economy was pulling out of its deflation. Afterwards, the views coming out of the meeting didn't do much to unsettle what was already known, that the government wants to know why deflation still persists and that the BOJ believes that CPI will turn positive soon and has no timetable for ending quantitative easing. When released, the October economic indicators, both leading and coincident, were in line with expectations, at 80.0 and 88.9, respectively. Anything above 50 indicates expansion. Another release, the Teikoku Databank business confidence, rose to 46.2 in November, up from October's 46. Projections are for continued improvements through the three-month, six-month and one-year outlooks. However, either in a sell-the-fact reaction or jitteriness over a newly surfaced al Qaeda video that calls for attacks on oil sites or over tomorrow's release of Japan's October machinery orders, the Nikkei dropped after 2:00 pm. There's been much optimism about that machinery orders number, but perhaps some thought that it was time to take profits after big gains when the Nikkei started chopping around this week.

Most other Asian markets climbed, but the Taiwan Weighted was an exception, closing lower by 0.33%. South Korea's Kospi gained 0.28%, and Singapore's Straits Times rose 0.15%. Hong Kong's Hang Seng increased by 0.96%, and China's Shanghai Composite gained 1.09%.

European markets were mixed as this report was begun but had all turned positive by the time it was completed, with metals and oil-related issues gaining, but automakers and some insurers slipping. Morgan Stanley downgraded German reinsurer Munich Re after bank HVB said it's reducing its stake in the company from its previous 7.9% to 4.9%. Also Credit Suisse Group fell ahead of an investor presentation. The U.K.'s Barclays PLC, a banking-sector issue, initially declined after announcing a change in executives, but the stock had turned positive again by the time this report was prepared. In an interview released this morning, an ECB member says that Europe isn't seeing the same recovery as that seen in the U.S. and will be more cautious about raising interest rates than the U.S. has been. The U.K.'s November consumer confidence number, released by Nationwide Building Society, rose to 101 from October's 92, with this registering the biggest jump seen since the survey began in May, 2004.

As of 5:16 EST, the FTSE 100 was higher by 23.90 points or 0.43%, at 5562.70, and today's trading has produced a high not seen in almost four and a half years. The CAC 40 was higher by 9.50 points or 0.20%, at 4,686.70. The DAX was higher by 6.63 points or 0.13%, at 5,307.48.

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