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OI Technical Staff : 8/25/2006 9:59:59 PM

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Marc Eckelberry : 8/25/2006 7:31:30 PM

Tab, great data on weekly BPNDX. Add to that chart the 20 month moving average at 1583 which is what we need to close above in August, otherwise all bets are off on the recovery. So far, it has been pretty clear R and we have 5 days to do the job, or the monthly chart will be in trouble once again. Critical week, but we have the holdiay coming and that usual gets bulls going. Link

Tab Gilles : 8/25/2006 6:41:38 PM

Profund UOPIX/USPIX 2 years Link

Jeff Bailey : 8/25/2006 6:33:40 PM

Thanks! Adding that to my favorites. Can never remember QLD.

Jeff Bailey : 8/25/2006 6:33:34 PM

Current OPEN MM Profiles that I've made at this Link

Today's Activity

Swing traded short the NASDAQ-100 Tracker (QQQQ) at the bid of $38.33, stop currently $38.55, targeting $37.50.

Tab Gilles : 8/25/2006 6:17:40 PM

Profund ETF's Proshares Link Link

Jeff Bailey : 8/25/2006 6:09:43 PM

Closing Internals found at this Link

Jeff Bailey : 8/25/2006 6:01:45 PM

A good time period of study for those that utilize market internals and are looking at some NASDAQ names may be to review July 7 and days following. It was on July 7 that the NYSE 10-day NH/NL ratio gave its first "buy signal" at 32.00%.

At today's close, the NASDAQ's 10-day NH/NL ratio gives its first "buy signal" at 38.00%.

Jeff Bailey : 8/25/2006 5:55:46 PM

Tab! While you're here. What is that security that is based off the QQQQ, that moves 1.5 times?

Jeff Bailey : 8/25/2006 5:26:46 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 8/25/2006 5:22:13 PM

DJ- CBOE Most Active Call, Put Option Series Link

Tab Gilles : 8/25/2006 5:17:13 PM

$NDX/$BPNDX/$NASI/$NALOW weekly Link

UOPIX & UAPIXFollowup to 8/16 3:26PM post. Link Link

Jeff Bailey : 8/25/2006 4:46:38 PM

El Paso Electric (EE) Repurchased 402,100 shares Aug 8-23

DJ- El Paso Electric Co. (EE) after Friday's closing bell said it repurchased 402,100 shares of its common stock from Aug. 8 to Aug. 23 for around $9 million as part of the buyback program approved by the company in February 2004.

The El Paso, Texas, electric utility said that around 1.3 million shares remain authorized to be repurchased under the buyback program.

EE $22.87 +0.21% Link

Jeff Bailey : 8/25/2006 4:42:33 PM

Tropical Depression Becomes Tropical Storm Ernesto

DJ- Tropical Storm Ernesto formed from a tropical depression Friday over the Caribbean as it moved toward Jamaica and the Cayman Islands, the U.S. National Hurricane Center said.

Ernesto, which posed no immediate threat to land, could develop next week into the first hurricane of the 2006 Atlantic season, the center said.

The outer edges of the storm were expected to bring rain to Puerto Rico, the Dominican Republic, and Haiti over the next 24 hours.

Jeff Bailey : 8/25/2006 4:38:34 PM

That's why I was grinning Marc.

Bullish to see the "big guns" like CSCO, MSFT and INTC starting to show some life as we approach Q4.

Beauuuutiful BPNDX setup too Link as we see the 10-day NH/NL ratio get a "buy signal," its first since this spring!

Marc Eckelberry : 8/25/2006 4:31:48 PM

Yeah, Jeff, I thought of correcting that after I wrote it, but I figured everyone would get it. Whne I mention a hot stock for 2007, I am talking to investors, of course.

Marc Eckelberry : 8/25/2006 4:32:52 PM

Tab, this time, we have a 50% close from a pretty important decline. Something's up, but as you said we have been fooled before. But shorts should be careful, you can't play with fire too many times without getting burned. Valuation on a forwad basis is compelling, but my analyis is that forward growth estimates are far too conservative based on the succees of Apple switch and the Wimax deployment. As far as high end servers, Intel is still the top choice and their new servers are just fine. In other words, we could have some serious upgrades and revisions coming in October. I do wish they would have fired Otellini, though.

Jeff Bailey : 8/25/2006 4:29:30 PM

On Tuesday, it will be one-year to the day when I introduced BGC Link as a "hurricane" play at $14.99.

How time, and some stocks fly.

Was talkig with my buddy that is a regional manager for the company this morning. You know what they're watching.

Jeff Bailey : 8/25/2006 4:16:30 PM

US Bank Business Loans Up $12.8 Bln In Latest Week

DJ- Large U.S. banks' commercial and industrial loans rose $12.8 billion to $1.169 trillion in the week ended August 16, the latest week for which data are available, after rising $2.6 billion the previous week, the Federal Reserve said Friday.

Jumbo certificates of deposit at the large banks in the survey rose $4.6 billion to $1.612 trillion in the latest week after falling $10.4 billion the previous week. Revolving home equity loans fell $700 million to $424.9 billion after falling $3.0 billion the previous week.

Jeff Bailey : 8/25/2006 4:15:13 PM

Penn Traffic Co Recalling Spring Water for excess bromate

Jeff Bailey : 8/25/2006 4:14:10 PM

Dow Jones Corp. Bond Index 189.64, yield 5.88%.

Jeff Bailey : 8/25/2006 4:12:28 PM

Goldcorp (GG) $30.15 -0.06% ... Recommends rejection of mini-tender offer by TRC Capital.

Jeff Bailey : 8/25/2006 4:11:23 PM

Mexico's June Economic Activity Up 6.8% On Year

Jeff Bailey : 8/25/2006 4:10:33 PM

Weis Markets (WMK) $38.91 +0.69% Link ... Voluntary recall for one gallon containers of Weis Quality Spring Water. Some tests showed excess bromate in the bottled water.

No idea where Weis does business, but in Gulf states, thought I'd make a note here.

Jeff Bailey : 8/25/2006 4:04:45 PM

QQQQ ... looks official at $38.32 +0.18% ...

Jeff Bailey : 8/25/2006 4:03:44 PM

That's it ... not a lot of umph like the other day.

Jeff Bailey : 8/25/2006 4:02:03 PM

Still "stuck" PREM 4.09

Jeff Bailey : 8/25/2006 4:01:14 PM

Buy Program Premium ... SPY $129.93

Jeff Bailey : 8/25/2006 3:57:16 PM

QQQQ $38.33

Jeff Bailey : 8/25/2006 3:55:53 PM

Just never know ... some good looking setups for bullish pullback entries next week.

QQQQ, INTC, MSFT are a few.

Jeff Bailey : 8/25/2006 3:54:20 PM

After INTC closed its WEEKLY R2 last week, that sure has been support.

Tab Gilles : 8/25/2006 3:53:40 PM

Marc, I agree that INTC is set to rally. Then again I've been saying looking for that for several weeks now. However, the DJIA should rise 10%. It is undervalued based on Price-to-Sales. Over the last 10 years it has averaged 1.25 P/S, currently its at 1.12.

Tab Gilles : 8/25/2006 3:51:38 PM

EMIS 60 minute chart rising since hammer. Link

Jeff Bailey : 8/25/2006 3:51:04 PM

I think you mean investors Marc! (grin)

Jeff Bailey : 8/25/2006 3:49:42 PM

For you weather watchers ... here the Link to the NOAA.

Marc Eckelberry : 8/25/2006 3:48:58 PM

An NQ close above 1564.50 sets up more gains on Monday.

Marc Eckelberry : 8/25/2006 3:49:48 PM

Back. The big news is INTC finally breaking out. If it closes above 18.88, we could be due for a run to the May gap at 21. I still maintian that INTC will be THE stock of 2007, a dog of the DOW that will make headlines and a double from here. Patient traders will be rewarded.

Jeff Bailey : 8/25/2006 3:47:01 PM

QQQQ $38.35 now ...

Jeff Bailey : 8/25/2006 3:45:34 PM

Should be something to look forward to next week. Like a good soap opera.

Turn to a 60-minute interval chart at check out the 21, 50 and 200-pd SMA's.

I've got 200 currently rising at $37.15, 21 is trending down, but juuuust rounding out at $38.23, and 50-pd right here at DAILY R1 of $38.43.

Jeff Bailey : 8/25/2006 3:42:47 PM

Should QQQQ close $38.35, that would be a penny below next week's WEEKLY Pivot.

Jeff Bailey : 8/25/2006 3:35:24 PM

QQQQ ... $38.43 +0.47%

Jeff Bailey : 8/25/2006 3:34:43 PM

Sure doesn't look like a "close near the lows" at this point.

Jeff Bailey : 8/25/2006 3:32:50 PM

03:05 Internals found at this Link

Tab Gilles : 8/25/2006 3:28:02 PM

Emisphere Technologies (EMIS)Last Trade: $8.11/ Day's Range: 7.75 - 8.16

Daily Chart...Finding support at 50-ma. Link

Hourly...Bouncing off 50% Retracement level with a bullish hammer candle. Link

EMIS Sep 2006 10.0000 put (MTQUB.X) Bid: $1.85 Ask: $2.10

Jeff Bailey : 8/25/2006 3:06:59 PM

03:05 Market Watch found at this Link

Jane Fox : 8/25/2006 3:00:58 PM

Once we got over the euphoria from Bernanke's speech the day has been exactly what I thought it would be - a real yawner.

Jeff Bailey : 8/25/2006 2:46:16 PM

DAILY Pivot correction alert for QQQQ ... couldn't figure out why QCharts' DAILY R1 was $38.43 and not matching my spreadsheet calculations.

Yesterday's high for QQQQ was $38.35, not $38.25 as I had typed.

So ... QQQQ Daily Pivot Levels ... $37.74, $38.00, Piv= $38.17, $38.43, $38.60.

Jeff Bailey : 8/25/2006 2:23:55 PM

QQQQ $38.34

Jeff Bailey : 8/25/2006 2:23:23 PM

Intel (INTC) $18.88 +1.72% ... session highs and gets a trade at WEEKLY R1.

Jeff Bailey : 8/25/2006 2:18:31 PM

Haven't checked Keene's "wave analysis" lately. Any of that stuff jive?

Jeff Bailey : 8/25/2006 2:14:05 PM

MSFT $25.86 +0.42% ... did come back to where we decided to sell the 1/2 position long in the underlying.

Has held $25.50 for the most part this week. Give/take a couple pennies.

Jeff Bailey : 8/25/2006 2:12:33 PM

Then comeback ... see DE at $68, QQQQ above $39 and MSFT at $26.40 and "round to full"

Jeff Bailey : 8/25/2006 2:10:38 PM

Idealy ... the plan is to cover the QQQQ short next week, buy some Dec/Jan calls, then go on vacation!

Jeff Bailey : 8/25/2006 2:06:54 PM

QQQQ ... 15-minute interval chart with 21, 50 and 200 period SMA's might be the time interval for my QQQQ short.

Jane Fox : 8/25/2006 1:59:15 PM

WASHINGTON (MarketWatch) -- The United States is headed for a recession that will be "much nastier, deeper and more protracted" than the 2001 recession, says Nouriel Roubini, president of Roubini Global Economics.

Writing on his blog Wednesday, Roubini repeated his call that the U.S. would be in recession in 2007, arguing that the collapse of housing would bring down the rest of the economy.

Roubini wrote after the National Association of Realtors reported Wednesday that sales of existing homes fell 4.1% in July, while inventories soared to a 13-year high and prices flattened out on a year-over-year basis.

This is the biggest housing slump in the last four or five decades: every housing indicator is in free fall, including now housing prices," Roubini said. The decline in investment in the housing sector will exceed the drop in investment when the Nasdaq collapsed in 2000 and 2001, he said.

And the impact of the bursting of the bubble will affect every household in America, not just the few people who owned significant shares in technology companies during the dot-com boom, he said. Prices are falling even in the Midwest, which never experienced a bubble, "a scary signal" of how much pain the drop in household wealth could cause.

Roubini is a professor of economics at New York University and was a senior economist in the White House and the Treasury Department in the late 1990s. His firm focuses largely on global macroeconomics.

While many economists share Roubini's concerns about imbalances in the global economy and in the U.S. housing sector, he stands nearly alone in predicting a recession next year.

Jeff Bailey : 8/25/2006 1:58:23 PM

Here come the QQQQ $38.40.

Jeff Bailey : 8/25/2006 1:58:09 PM

Eh ... if the put selling was done, it wasn't done via CBOE.

My Ameritrade Level II shows 15,989 Sep $38 Puts having been traded so far today (all exchanges).

QCharts just shows CBOE trades. Do see 1,037 traded from 10:05-10:10 from $0.40-$0.35.

Jeff Bailey : 8/25/2006 1:52:33 PM

Was looking for similar PUT SELLING at the NDX 1,550 strike.

Jeff Bailey : 8/25/2006 1:49:46 PM

Looking at the NDX.X option chain, but very little volume for options there.

Jeff Bailey : 8/25/2006 1:34:46 PM

Right? A SELLER of a PUT is saying ... I'm willing and able to buy strike, less the premium I'm receiving.

Jeff Bailey : 8/25/2006 1:33:23 PM

QQQQ Option Chain ... found at this Link ... I want to take a look at the QQQ-UL now, and see what time, and how much of that option was SOLD.

$38 - 0.55 = $37.45. (see 11:40:16) ... $37.45 pretty close to first entry of punching in a $38.25 close.

Jeff Bailey : 8/25/2006 1:20:01 PM

Yep ... that might have done it.

Jane Fox : 8/25/2006 1:19:39 PM

If you draw your trendlines a little different you can create a much more bearish picture but I don't think that's the scenario we should be watching because the MACD and RSI are not flashing bearish divergences. The MACD and RSI are telling me the bullish picture has the highest probability of playing out. Link

Jeff Bailey : 8/25/2006 1:17:42 PM

01:00 Internals found at this Link

Jane Fox : 8/25/2006 1:15:07 PM

Although the bulls would certainly like to see 1290 support hold they don't have a lot to worry about because there is still the confluence of the 3 major EMAs and the upward trendline that should be major support. If that support breaks then the bulls have a lot to worry about. Link

Jeff Bailey : 8/25/2006 1:09:15 PM

Look at that intra-day chart on 5-minutes.

That's where the QQQQ volume came from!

Some type of BIG bullish option trade was made (put sell, or call buy) ... has to be!

Jeff Bailey : 8/25/2006 1:08:03 PM

VXN WEEKLY S1 at 17.45. Its right here.

Jeff Bailey : 8/25/2006 1:02:54 PM

01:00 Market Watch found at this Link ... VXN.X pinned at low of the day. Might be helpful to grap an option chain, see where the action is at. (strike/month)

Keene Little : 8/25/2006 1:01:11 PM

I've got to leave for the day. I had hoped we'd see something a little more bullish today. I'm getting the feeling that the consolidation since Wednesday is now a bearish sign. It's now looking like the uptrend line from Aug 11th is going to break in which case look for a run down to 1288-1289. The stop on a long belongs at 1294.25 unless you want to limit is further and then it should be at 1295. That way we'll let the market prove that it can't hold up here. Good luck and have a great weekend.

Jeff Bailey : 8/25/2006 12:57:13 PM

QQQQ 25-cent box chart. Really adds some noise, but envisioning the trade Link

Jane Fox : 8/25/2006 12:56:43 PM

SAN FRANCISCO (MarketWatch) -- Gold futures rose Friday on the heels of a three-session losing streak, ready to end the week almost $10 higher, with prices supported by a weather-driven rally in the oil market, but traders finding little about the U.S. economy and inflation in a speech from Federal Reserve Chairman Ben Bernanke.

"While gold was being helped just a bit by rising crude oil prices...the overall tone remains subdued and is punctuated by thin trading conditions," said Jon Nadler, an investment products analyst at bullion dealers Kitco.com. "A fresh impetus is needed in the marketplace in order to shake traders out of their somnolence -- perhaps the week after next."

Gold for December delivery was up $3 at $631.50 an ounce on the New York Mercantile Exchange. On Thursday, the contract closed lower for a third consecutive session, after weak data on home sales and durable goods orders eased inflation fears and with it, gold's attraction as an inflation hedge.

The contract has lost around 1% in the past three sessions, but it's trading higher by 1.5% from last week's closing level of $621.70.

Bernanke didn't "speak on the economy or monetary front -- just globalization," said Peter Grandich, editor of the Grandich Letter.

Jeff Bailey : 8/25/2006 12:54:34 PM

That was a BIG volume spike this morning in the QQQQ ... 6.4 million shares from 10:00-10:05 with price surging from $38.26 to $38.46.

Level II INET still shows some pretty good depth to $38.24.

Jeff Bailey : 8/25/2006 12:50:10 PM

QQQQ $38.30 ... mid-point of day's range $38.35

Jeff Bailey : 8/25/2006 12:49:18 PM

Whack, ck, ck, ck

Jeff Bailey : 8/25/2006 12:33:32 PM

Current OPEN MM Profiles that I've made at this Link

Keene Little : 8/25/2006 12:16:39 PM

ES 1296 is holding but the bulls are sure having to work for this one. A break below 1295 would not be a good thing and that's where I'd place my stop if long. It's just not worth risking anything more than that.

Jeff Bailey : 8/25/2006 12:11:18 PM

Swing trade sell short alert ... for 1/2 position in the QQQQ $38.33 here, stop $38.55, target $37.50.

Jeff Bailey : 8/25/2006 12:07:00 PM

LSI Logic (LSI) $7.48 -1.70% Link ... notable 52-weeker at the big board.

Jane Fox : 8/25/2006 11:48:18 AM

Markets have almost retraced all of the day's gains. Link

Jeff Bailey : 8/25/2006 11:40:16 AM

Playing with today's QQQQ close .... if I punch in $38.25 as a close, I can only get a Weekly S2 of $37.44.

If I punch in a $38.00 close, I get "ringy-dingy" WEEKLY S2 of $37.35.

Jeff Bailey : 8/25/2006 11:35:57 AM

Hmmm... if week's highs/lows are in and QQQQ closes here ... what are next week's pivot levels?

Jeff Bailey : 8/25/2006 11:34:53 AM

ringy-dingy .... $37.35.

Jeff Bailey : 8/25/2006 11:33:32 AM

Turning the page on my StockTrader's Almanace ... Monday's quote .... End of August Murderous 6 of Last 9 years, Average Loss Last 5 Days: Dow -2.9%, S&P -2.7%, NASDAQ -2.4%.

QQQQ $38.27 here ... what would a 2.4% decline put the QQQQ at?

Jeff Bailey : 8/25/2006 11:25:54 AM

11:00 Internals found at this Link

While we don't chart the ratios until the close, NYSE 5-day NH/NL ratio would reverse back lower by 3 boxes at 78.00%.

Current NASDAQ 10-day NH/NL ratio of 40.00 gets the "buy signal" and first since "sell signal" about 05/08/06. I say "about" as I had been on vacation prior and was in the process of getting this data repopulated. Might have been a couple of days earlier, but you can see the QQQQ really broke down just after 05/08/06 from the $42.00 level. No different for the COMPX

Jane Fox : 8/25/2006 11:10:22 AM

These are not giving a bullish picture yet not really bearish either. Link

Keene Little : 8/25/2006 11:05:12 AM

Another test of the uptrend line, now at 1296, would make this look more like a consolidation above the line and that would suggest it's going to break eventually. Keep your stops tight if long. If this breaks down then you'll have another opportunity to try it at 1288-1289.

Jeff Bailey : 8/25/2006 11:04:24 AM

11:00 Market Watch found at this Link

Jeff Bailey : 8/25/2006 10:48:06 AM

Caterpillar (CAT) $65.90 +0.61% Link ....

CAT's chart somewhat similar to supply/demand for BA Link back in July (7) and early August (8)

Jane Fox : 8/25/2006 10:46:46 AM

AD line and volume are both neutral.

Jane Fox : 8/25/2006 10:46:26 AM

It is now quite obvious that little buying spree was totally due to Bernanke's statement and we may have now fallen back into the summer doldrums.

Jeff Bailey : 8/25/2006 10:45:54 AM

Deere, Co (DE) $74.05 +1.06% Link ... Gets trade at $74.00.

Stock has done nothing but rise since we closed original put position on the latest earnings report and guide down on forward earnings.

Jeff Bailey : 8/25/2006 10:42:38 AM

Brazilian Bovespa Index ($BVSP) Link .... somewhat of a reverse h/s pattern on the PnF chart. Shoulders at 35,000, neckline 38,500.

Jeff Bailey : 8/25/2006 10:39:29 AM

Brazil Stocks Rise; Real Pares Losses On Bernanke Speech

DJ- Brazilian stocks rose and the real pared losses Friday following a speech by U.S. Federal Reserve Chairman Ben Bernanke in which he did not address the central bank's economic and monetary policy outlook.

At 1425 GMT, the benchmark Ibovespa stock index was 0.6% higher at 36,003 points on the Brazilian Stock Exchange, or Bovespa, while the real stood at BRL2.155 per dollar in spot contract trading on the Brazilian Mercantile and Futures Exchange, or BMF, up from BRL2.159 shortly before the speech.

Market players were looking for Bernanke to signal the possible impact of weak economic data on U.S. monetary policy. A lack of comment was interpreted as a reinforcement of this month's decision to pause its monetary tightening policy, traders said.

Jeff Bailey : 8/25/2006 10:36:48 AM


DJ- Apple issues a recall of 1.8 million laptop-computer batteries, on the heels of a 4.1 million battery recall by rival Dell that cast a harsh light on the perils of a widely used battery technology. A unit of Sony made the battery cells.

AAPL $68.34 +0.78% Link

DELL $21.74 -0.18% Link

SNE $42.87 -0.90% Link

Keene Little : 8/25/2006 10:29:13 AM

A 38-62% retracement of the leg up from yesterday's low gives us a potential support zone of 1297.50-1299.00. The previous highs from yesterday afternoon are at 1299 so let's see if that offers support for the current pullback.

Jeff Bailey : 8/25/2006 10:27:23 AM

H&R Block ... Reuters Story Link

Jeff Bailey : 8/25/2006 10:26:21 AM

"Good dog Drake...."

Jeff Bailey : 8/25/2006 10:26:09 AM

H&R Block (HRB) $20.61 -9.56% Link ... this may be what is weighing on banks this morning.

Company warned this morning that will take a $61.3 million charge ($0.19/share) related to $102.1 million in pretax losses from subprime mortgage customers falling behind on loan payments.

Keene Little : 8/25/2006 10:20:16 AM

It's not much but you can raise your stop on the ES to 1294.25, two ticks to a new low today.

Jeff Bailey : 8/25/2006 10:19:04 AM


DJ- Alaska oil official says will take several days to fix equipment and resume production of 90,000 barrels a day at Prudhoe Bay. BP also halts development of a $650 million Gulf Coast LNG terminal because of project's "economics."

Jeff Bailey : 8/25/2006 10:17:36 AM


DJ- Exchange offers Comex members up to 8,400 shares each to open electronic metal trading platform to outsiders to better compete with CBOT, say people familiar with the situation. Deal would allow nonmembers to trade around the clock.

Jane Fox : 8/25/2006 10:16:26 AM


Jeff Bailey : 8/25/2006 10:16:05 AM


DJ- Government notifies firm it has 'discontinued' its two-year investigation into the mortgage giant. It is unclear whether former and existing executives could face individual charges.

FNM $50.76 -1.49% Link

Jeff Bailey : 8/25/2006 10:13:17 AM


Tropical Storm Debby is expected to remain over open waters in the open Atlantic, but another system north of Venezuela is on the verge of strengthening into a named storm, forecasters say. Oil prices rise on news.

Jane Fox : 8/25/2006 10:13:00 AM

All markets are testing the upper trendline of their bull flags but none has broken thru yet. I didn't expect them to break the flag until next week but of course Mr. Market has its own agenda and really cares little what I think.

Jeff Bailey : 8/25/2006 10:11:03 AM

I thinks it is what he "isn't saying" or talking about that gives the jerk back higher Jane.

Morning weakness may have been "what if he talks about the economy, or inflation?"

Jane Fox : 8/25/2006 10:10:27 AM

Jeff beat me by 9 seconds. :)

Jane Fox : 8/25/2006 10:09:40 AM

JACKSON HOLE WY (MarketWatch) -- Economic policymakers have to make sure that enough segments of society feel the benefits of globalization in order to guard against protectionism, said Fed chief Ben Bernanke on Friday.

"The challenge for policymakers is to ensure that the benefits of global economic integration are sufficiently widely shared -- for example, by helping displaced workers get the necessary training to take advantage of new opportunities -- that a consensus for welfare-enhancing changes can be obtained," Bernanke said in remarks to the Fed's Jackson Hole retreat.

The effort is not easy, but is well worth making because the benefits of global integration are large, he said.

Opponents of globalization tend to come from workers and firms whose livelihoods are threatened by the changing pattern of production.

"The natural pattern is to resist change, for example, by seeking the passage of protectionist measures," he said.

Bernanke did not discuss the economic outlook or monetary policy in his prepared remarks.

Jeff Bailey : 8/25/2006 10:09:31 AM

Fed's Bernanke: Benefits of Globalization Must Be Shared

DJ- The current episode of global economic integration is moving at an unprecedented pace, forging the basis for productivity growth and a reduction in global poverty, Federal Reserve Chairman Ben Bernanke said Friday.

But in prepared remarks to global monetary officials and private-sector economists, he urged policy-makers to make sure the benefits of globalization are widely shared in order to stem protectionist sentiment.

"Economic and technological changes are likely to shrink effective distances still further in coming years, creating the potential for continued improvements in productivity and living standards and for a reduction in global poverty," Bernanke said in a speech to the Federal Reserve Bank of Kansas City's annual conference in Jackson Hole, Wyo.

The subject of this year's event is globalization and its effect on policy. Bernanke's speech is his first at Jackson Hole since becoming Fed chairman in February.

He didn't address the economic and monetary policy outlook in his prepared speech. The Fed earlier this month paused its two-year tightening campaign with the Fed funds rate at 5.25%. Economists increasingly think the funds rate will peak there, though upcoming inflation and employment reports will be critical in determining the outcome of the September Fed meeting.

Bernanke noted in his speech that globalization, for all its benefits, leads to some dislocation among certain workers and firms, and "the natural reaction of those so affected is to resist change, for example, by seeking the passage of protectionist measures." He noted that current global tensions and terrorism risks also threaten to constrain globalization.

"The challenge for policy-makers is to ensure that the benefits of global economic integration are sufficiently widely shared...that a consensus for a welfare-enhancing change can be obtained," Bernanke said, citing the benefit of robust training programs.

Though difficult, efforts to build a broad consensus on further globalization are "well worth making, as the potential benefits of increased global economic integration are large indeed," Bernanke said.

Much of his speech Friday was a historical look back at globalization going back 2,000 years to the Roman Empire.

Bernanke touched on the voyages of Columbus, emergence of English and Dutch trading companies, development of economic theories by Adam Smith and David Ricardo, and even cited Martin Luther as an early opponent to trade in the 16th Century.

Despite all those changes through centuries, "there are no historical antecedents" to the current episode of globalization that includes the emergence of China, India and former communist-bloc countries, Bernanke said.

Jane Fox : 8/25/2006 10:08:33 AM

I can't find anything that Bernanke has said that would put this market in such a good mood but he obviously didn't say anything "bad."

Jane Fox : 8/25/2006 10:06:50 AM

ES now tests its PDH and seems like it wants to punch through as well but pauses.

Jeff Bailey : 8/25/2006 10:06:47 AM

YM 11,337 after morning kiss of DAILY S1.

Jane Fox : 8/25/2006 10:06:08 AM

Neither NQ nor ER took a pause at their PDHs. This is pretty bullish.

Marc Eckelberry : 8/25/2006 10:04:17 AM

Can't leave this is pretty exciting and a nice suprise. Wacthc r1 here.

Jane Fox : 8/25/2006 10:04:15 AM

TICKS have made a high of 1154. I had my speakers turned down and did not hear the TICK +1000 alert. No matter I would not be fading today anyway.

Jeff Bailey : 8/25/2006 10:05:08 AM

Bank of Montreal (BMO) $58.93 -1.37% Link ... slips back under its WEEKLY R2 $59.05.

Keene Little : 8/25/2006 10:03:35 AM

If this is ready to rally now it should pop higher quickly. It can't continue to chop sideways and maintain a bullish picture. It's now or never. Starting to punch higher now as I type.

Marc Eckelberry : 8/25/2006 10:03:12 AM

Inside day is broken and they bid it right on 1564.50.

Jeff Bailey : 8/25/2006 10:02:59 AM

10:00 Market Watch found at this Link

Jane Fox : 8/25/2006 10:02:48 AM

VIX is testing daily lows as ES tests daily highs.

Marc Eckelberry : 8/25/2006 10:02:07 AM

Looks like someoen wants to drive this one up. Watch 1464.50

Keene Little : 8/25/2006 10:01:43 AM

Nice recovery off that uptrend line at 1295. We've certainly had several edge-of-the-cliff long plays the past few days. It hasn't exactly been rewarding yet for those who are trying longs at that trend line but by the same token you've been able to keep your stops tight. At this point I'd say continue to stay long unless 1294.75 gives way, or just keep it at 1293. Again, no wiggle room for a market that seems to be struggling right here.

Marc Eckelberry : 8/25/2006 10:01:04 AM

Inside day shaping up if QM bids above 73.50.

Jane Fox : 8/25/2006 10:00:10 AM

VIX is falling right out of bed (bullish) but the interesting internal and the one the bulls need to watch is the TRIN. It is climbing and has made a high of 1.25 so far today.

Jane Fox : 8/25/2006 9:58:53 AM

My goodness we seem to be in a rally mode here. AD line has climbed to +562.

Jane Fox : 8/25/2006 9:58:04 AM

Nope ER was.

Jane Fox : 8/25/2006 9:57:52 AM

Looks like NQ will be the first market to test its PDH.

Jane Fox : 8/25/2006 9:57:11 AM

Watch PDHs for resistance today.

Marc Eckelberry : 8/25/2006 9:56:16 AM

But of course, here comes QM.

Marc Eckelberry : 8/25/2006 9:56:02 AM

SOX has turned green, as stealth rally could be building, watch 1564.50 resistance.

Jane Fox : 8/25/2006 9:55:59 AM

And NQ Link

Jane Fox : 8/25/2006 9:55:26 AM

ER Link

Jane Fox : 8/25/2006 9:54:39 AM

YM Link

Marc Eckelberry : 8/25/2006 9:56:53 AM

QQV is green and SOX is red. NQ longs should only be scalps under these conditions. If it changes, fine, but that is the scene and it could give us chop. Everytime oil dips you will get a bump and everytime it notches up you will ge a drop. See you later, QM has resistance at 73.50, 38.2% so watch that.

Jane Fox : 8/25/2006 9:53:59 AM

Using a 240 minute chart I would like to show you the bull flags that are building. Here is ES. Link

Marc Eckelberry : 8/25/2006 9:50:42 AM

The fact that gold is not repsonding to higher oil tells me 2 things: either smart money does not believe the oil rally will last and that inflation risks are minimal, or both. In either case, this is bearish for gold and I maintian my 604 target IF we do not move above 634.

Jane Fox : 8/25/2006 9:47:10 AM

Here is a chart of Gold's big contract. Link

Jane Fox : 8/25/2006 9:39:17 AM

I remain neutral on Gold until it makes a SUSTAINED move above resistance or support. I am leaning a little more bearish than bullish however becauase it is trading below the 50EMA, which has been an excellent line in the sand for Gold. Link

Jane Fox : 8/25/2006 9:35:56 AM

Both the VIX and TRIN open within their respective PDRs and are supporting the bulls nor the bears.

Marc Eckelberry : 8/25/2006 9:34:55 AM

I would still maintain a gold short if it stays below 634.

Jane Fox : 8/25/2006 9:34:29 AM

Opps AD line is -677 and AD volume below 0. The bears have the ball this morning.

Jane Fox : 8/25/2006 9:29:19 AM

NQ has made it quite clear that 1540-1546 is support and is also at a very nice spot from which to rally. Link

Keene Little : 8/25/2006 9:26:44 AM

If 1293.50 gives way then the choppy pullback that started from the Aug 18th high will obviously continue and then the uptrend line from July 18th (see Jane's chart below) would be the likely place to get long (currently near 1288).

Marc Eckelberry : 8/25/2006 9:25:09 AM

With oil rising from a potentila hurricane threat, trading today could be treacherous. I would advise novice traders to sit it out. The business of trading is also knowing when to keep your powder dry. All positions are closed, I might scalp here and there, like the NQ pivot trade setting up now with open reversals.
Longer term, I plan on finding an entry to hold on short oil through the end of the year, where I think it will reside in the low 60's.

Jane Fox : 8/25/2006 9:25:08 AM

ER is not as bullish as ES and YM because it is below the major MAs but if ES and YM rally so will ER. ER has retraced nicely and is at a very good spot from which to rally. Link

Keene Little : 8/25/2006 9:22:46 AM

The uptrend for ES from Aug 11th through Wednesday's low is currently at 1295 and that's the level I want to see hold. It may undercut a little but it can't drop below 1293.50 without negating the bullish chart (of higher lows).

Jane Fox : 8/25/2006 9:14:10 AM

ES is the driver of this market and YM just seems to following along for the ride. Link

Jane Fox : 8/25/2006 9:11:46 AM

This is a bullish chart. I thought ES needed to test the bottom of upward channel before it was able to launch its next upward move and expected that test to come from ES moving down to the trendline. What I didn't expect was ES moving sideways and the trendline moving up to meet it.

I don't think that rally will start today but it surely could next week. Link

Jane Fox : 8/25/2006 8:58:14 AM

Make sure you are aware of this - Attention on Friday will turn to Jackson Hole, Wyo., the site of the Federal Reserve annual symposium. Mr. Bernanke is due to speak at 10 a.m. EDT about global economic integration

Jane Fox : 8/25/2006 8:57:48 AM

Here is why Oil and Natural Gas had a bid overnight - Crude-oil futures rose $1.03 to $73.39 a barrel early Friday. Traders are monitoring Tropical Storm Debby and a tropical wave in the Atlantic, which forecasters say could escalate into a bigger storm. The activity has prompted fears that a storm could damage Gulf Coast oil facilities, as in 2005, when hurricanes Katrina and Rita battered the region. Many refineries are still recovering from those storms.

Jane Fox : 8/25/2006 8:56:34 AM

Dateline WSJ - Former U.S. Treasury Secretary Robert E. Rubin has resigned from the board of Ford Motor Co., citing a potential conflict of interest with his duties as a member of the chairman's office at the banking company Citigroup Inc.

The news comes amid new turns in the Ford story. In recent days, the head of a British construction-machinery group said he was interested in buying the struggling luxury brand Jaguar. (See related article.) Also, Ford is in talks to sell some luxury-auto brands - in particular, Jaguar and Land Rover, to an investment group led by former CEO Jacques Nasser, Bloomberg reported.

In a letter released Friday to Ford Chairman and Chief Executive Bill Ford, Mr. Rubin said he needed to step down as the board begins a review of the struggling company's strategic options.

"Citigroup's multi-faceted relationship with Ford could raise a question whether my relationship with Ford and Citigroup creates an appearance of conflict. Although no conflict currently exists and while I would have liked to remain involved, I have with great regret concluded that I should resign from the Board at this time," Mr. Rubin said in the letter. Mr. Rubin had been on the board for six years.

Keene Little : 8/25/2006 8:56:30 AM

If you're long ES I would place my stop just below 1293.50, yesterday's low. But in reality I don't want to see it drop below yesterday afternoon's low of 1295.50 otherwise I'd be concerned that it will keep going. The overnight low is 1295.75. At this point I feel that giving the market no wiggle room is the best course of action. And stay out of the chop today if it doesn't immediately start to rally this morning.

Jane Fox : 8/25/2006 8:54:54 AM

Commodities were a lot busier overnight than the equities with both Oil and Natural Gas spending most of the time above their PDH. I wonder if there was news about a storm overnight. I will have to check.

Gold tested its PDL but rebounded and is breaking its overnight high as I type.

TBonds tagged their PDH was not able to break through and has retreated to about 50% of its PDR. Link

Jane Fox : 8/25/2006 8:50:44 AM

The overnight session was about as neutral as I have seen all summer. No direction one way or the other. HMMMM this is a summer Friday isn't it? How much do you want to bet the intraday session is very similar. Time to go get the toothpicks (to hold your eyelids open). Link

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