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Jeff Bailey : 9/29/2006 1:23:05 AM

Japan August Industrial Output Up 1.9% on Month

DJ- Japan's August industrial production rose 1.9% from the previous month and shipments jumped 2.5%, the Ministry of Economy, Trade and Industry said Friday, indicating that the recovery will continue despite some recent mixed indicators.

The rise was in line with economists surveyed by Dow Jones Newswires, who estimated on average the industrial production increased 1.9% from the prior month after adjustment for seasonal factors after falling 0.9% in July.

The ministry also said it expects output to slip 0.1% in September and then increase 1.8% in October, based on surveys of companies.

METI said that output is in an upward trend, unchanged from the previous month.

Jeff Bailey : 9/29/2006 1:13:45 AM

Index Pivot Matrix at this Link

Note: Correlative DAILYR2/WEEKLY R2 for QQQQ/NDX

Keene Little : 9/29/2006 1:05:03 AM

Friday's pivot tables: Link and Link

Tab Gilles : 9/29/2006 12:28:55 AM

Open Positions & Watch List Link

$NDX Link

$NAHL Link

$NALOW Link

Profund UltraOTC (UOPIX) Link

$NALOW -10-wema & UOPIX Link

$NAHGH-10-wema & UOPIX Link

OI Technical Staff : 9/28/2006 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The Market Monitor has been archived.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 : 9/28/2006 7:31:16 PM

StockCharts' S&P 500 Bullish % ($BPSPX) Link

Remember! The PnF methodology for time is that the months January-September are 1-9 and October-December are A-C.

Any given year, what shape was the MARKET in going into October (A), where the "A" will be placed the first box that we could place it early in the month (not always the 1st day of that month).

Assess the MARKET's internals, then the SECTOR's. Once that's done pick your ETF if available, or a STOCK that looks to me running with the herd.

See the "8" and "9" in year 2004?

On a quantitative basis, I can say that RISK and INTERNAL strength/weakness look to be similar today as they were then.

If I/you look at a BAR Chart of the SPY, I think were either at 10/05/04, or 11/08/04.

Jeff Bailey : 9/28/2006 6:57:36 PM

Tomorrow I'm going to take some time and "translate" the StockTrader's Almanac bullish seasonal sectors to the Dorsey/Wright Sector Bullish %, with some different time intervals to try and see where the money is going.

WALLstreet and SOFTware we should have some exposure to (AMTD and SAP)

I do NOT, nor do I suggest, that a trader/investor do ANYTHING, just because "history says."

State the scenario, then find out what THE MARKET is actually doing and follow THAT HERD.

Jeff Bailey : 9/28/2006 6:50:39 PM

September 27 ... Total Equity Fund Inflows $835 Mil; Taxable Bond Fund Outflows $215.

Some details at this Link

Keep an eye on Treasury YIELDs, which rise on SELLING. Watch the dollar index. If selling in Treasuries, or muni bonds, what does the money do? Sit in cash (dollar rise), go back overseas (dollar flat), or go into equities (dollar flat, stocks rise). Commodities, CRB Index are also an investment class.

As always... keep an eye on those junk bonds, which are the "RISKIEST" asset class among fixed income.

Marc Eckelberry : 9/28/2006 6:30:07 PM

December gold closes above the all important 610 number. The race to close that gap at 623 is on.

Jeff Bailey : 9/28/2006 6:26:07 PM

A couple of years ago, a realtor here in Colorado told me the "best pulse" on any housing market is the number of U-Haul trucks sitting in a rental company's parking lot.

A lot of trucks= A lot of people have moved into the region.

No/few trucks= People are moving out of the region.

Amerco (UHAL) $76.18 +0.31% Link (Are people moving?)

Dow Jones Home Construction ($DJUSHB) 662.66 -0.08% Link

Jeff Bailey : 9/28/2006 6:16:29 PM

Hmmm... caller to James Cramer's "Mad Money" thinking a bit outside the box.

Caller: Is a cooling housing market in California a positive, or negative for HD/LOW? Negative possibly being slowdown in the "fix and flip," or positive being the stay put and fix up what you have?

I live in Denver, CO... see today's (01:36:33)

LOWs warned on earnings in recents sessions.

Jeff Bailey : 9/28/2006 6:00:22 PM

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

Jeff Bailey : 9/28/2006 5:45:59 PM

Closing Internals found at this Link

Jeff Bailey : 9/28/2006 4:42:30 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 9/28/2006 4:14:13 PM

Sell Program Premium ... SPY $133.74 : YM 11,772

Jeff Bailey : 9/28/2006 4:13:04 PM

I'd like to see Dow 12,000 next month Link

Jane Fox : 9/28/2006 4:12:08 PM

Here the headlines from the WSJ - Dow Tops Record

The Dow Jones Industrial Average cracked its record-high close Thursday and was hovering around that level near the closing bell.

"The Dow is teasing everybody right now," said Kenneth Tower, chief market strategist at CyberTrader.

Jim Brown : 9/28/2006 4:07:30 PM

It will be interesting to watch the futures overnight. If they remain flat it could mean they will make another run at the Dow record tomorrow but if they start turning lower it could be a leading indicator that they are done. Hedging their quarter end portfolio by shorting the futures would be a normal last day of the quarter event.

Jeff Bailey : 9/28/2006 4:05:46 PM

Another "benefit" of the pivot matrix Marc and traders that will try and trade the VIX.

Jim Brown : 9/28/2006 4:04:18 PM

Reports tomorrow morning include:

8:30 Personal Income
9:00 NAPM-NY
9:45 Consumer Sentiment
10:00 Chicago PMI

Monday

10:00 National ISM (very important)

Keene Little : 9/28/2006 4:03:30 PM

I'm really surprised they couldn't close the DOW over 11723 so that they could claim the highest all-time closing price. Tchh, tchh, I'm so disappointed. Maybe tomorrow.

Marc Eckelberry : 9/28/2006 4:03:43 PM

Thanks for the clarification Jim. I also want to add that trading VIX futures is a difficult game due to the large time premiums. You have to get it just right.

Jim Brown : 9/28/2006 4:02:01 PM

Nice try by the tape painters but they failed to hold over 11720. It will be interesting to see if they try again tomorrow. Given the worsening internals it would appear they are running out of steam.

Jeff Bailey : 9/28/2006 3:56:58 PM

VIX ... rises when there is more put buying/call selling than call buying/put selling.

VIX ... falls when there is more call buying/put selling than put buying/call selling.

Jim Brown : 9/28/2006 3:53:27 PM

I think all the talk about the VIX has probably confused some traders. Here is the link to the CBOE and how the VIX is calculated. Now you will really be confused. Link

Basically it is calculated on the bid/ask spread of a set number of SPX calls and puts and the value of those premiums. The wider the spread and the higher the premiums produces a fear factor index. (VIX) Betting on the VIX movement with futures is a way to capatilize on the increase in volatility as premiums increase on the SPX in times of market stress. Today, there is no stress so the VIX is low at 11.68. Back in June when there were fears of a market crash and high volatility in index movement the VIX hit 23. Traders who had bet on an increase in the VIX at 11.0 on May 8th would have made a wise bet.

Betting on the VIX is like betting on a thermometer. Betting on the temperature has no impact on the thermometer. However, betting when the temperature is 20 degrees in March that it will reach 90 in July is a pretty safe bet.

Betting that the VIX will rise from 11 over the next couple weeks may also be a safe bet.

Jeff Bailey : 9/28/2006 3:54:56 PM

SPY ... $133.94 +0.15% ... MONTHLY R2 just ahead at $134.07.

Jane/Norman ... will discuss Pivots later. Used to have several articles on Pivot Levels in the Ask the Analyst section, but they were deleted.

The basics are that these levels (DAILY, WEEKLY, MONTHLY even QUARTERLY) are mathematically derived using a prior day/week/month,quarter's High/Low/Close from regular session trade.

Institutional computers will use these levels to manage inventory.

I've tried to teach traders how to think like a computer, look at the levels, see how they have BEEN traded, then develop a trade plan based on other technical observations, possible scenarios (bullish, or bearish).

Marc Eckelberry : 9/28/2006 3:50:48 PM

100% projection August is 11,771.50. That fits even better. Just a little higher high.

Marc Eckelberry : 9/28/2006 3:49:44 PM

Keene, 11803 is 100% projection July.

Keene Little : 9/28/2006 3:46:58 PM

Here comes the closing push so they can get the positive media needed to suck in the retail buyers. Marc, you could be right on 11800. I've got the Fib zone around 11743-11764 so that's the first area I'm watching for (and SPX 1345-1347).

Marc Eckelberry : 9/28/2006 3:43:29 PM

Keene, I think sometime next week they will get the DOW up to 11800.

Keene Little : 9/28/2006 3:41:14 PM

I've had the very same thought as Dave and Marc (re: Marc's 3:34 post). Especially when I look at this chart of the VIX and think that this pattern calls for a VIX reading of sub-10 before it's finished, that would obviously happen with a blow-off top in the market. Link

Marc Eckelberry : 9/28/2006 3:34:20 PM

Re comment on everyone thinking it is time to load up on shorts I've been thinking the same thought. If we all lean to the same side of the boat you know what usually happens. Dave

Dave, that does have me on my toes and thinking that any pullback could be shallow at first. The only caveat has been the low VIX. Now it is slowly rising, but there is still a rather large amount of complacency out there. So high pc ratios but low VIX. Not an easy trade either way.

Jim Brown : 9/28/2006 3:30:20 PM

QM slipping below $62.50. Could be getting ready for an end of week dump.

Jim Brown : 9/28/2006 3:28:41 PM

Trade Alert Option traders - Now would be a good time to buy the DJX Oct $117 puts DJW-VM currently $1.00. Even if the tape painters do manage to close the Dow at a record that is only a dozen points above where we are now. This is a cheap trade and very low risk in terms of money invested.

Jane Fox : 9/28/2006 3:27:49 PM

Gold is back testing its overnight lows.

Jane Fox : 9/28/2006 3:20:20 PM

I am just getting started with Market Monitor. Would you mind clarifying the following codes used regualarly:
1. PDL/ PDH/PDR Previous Day Low/High/Range?
2. What is a Pivot Table? R2/R1/Pivot/S1/S2? R refers to Resistance Levels and S refers to Support Levels?
3. What is an AD line? Advance/Decline? Where is the data taken from?
Jane Fox referred to a article on gold early September: "The most useful EMA indicator for trading gold over nearly 32 years was to buy gold when the U.S. dollar crosses below its 7-week EMA and to sell gold when the dollar crosses above its 7-week EMA." I am wondering what chart the author would be referring to for the US Dollar, since the US Dollar would normally be compared to some other currency to create a chart?

Hi Norman and welcome to the Market Monitor.

Excellent questions.

You are absolutely right about PDR/PDL/PDR. I talk about those levels so many times I get tried of typing them out so I use abbreviations.

The Ad line is the number of stocks that are advancing minus the number of stocks declining and the AD volume is the volume of those stocks. This data is available on most charting platforms but with Tradestation you have to fiddle with it a tad.

My charts have a symbol for the US dollar which is the dollar compared to a basket of other currencies. Tradestation's symbol is $dxy and is similar on other charting platforms. You obviously have traded before.

I will let Jeff explain the Pivot table.

Jeff Bailey : 9/28/2006 3:19:48 PM

Good comment Marc (03:09:09) ... I had been getting questions this month as to why I've been more "swing" oriented than "day trade" oriented with my profiles.

When the bullish % first turn, that's the time to start going "longer-term" and macro.

Jeff Bailey : 9/28/2006 3:15:51 PM

03:00 Internals found at this Link

Marc Eckelberry : 9/28/2006 3:09:09 PM

Stepping away. Don't overtrade and get caught up in the minute moves. Smart money is macro.

Marc Eckelberry : 9/28/2006 3:06:19 PM

Right now, pivots and other daytrading tools mean little. Watch market breadth, volume, VIX and try and get a sense of what is going on behind the scenes. Why is NQ lagging when the SOX is ahead? Why was the entire day based on QM moves and now all of sudden, QM lost support, but the bounce in equities is dying? Maybe becuase there is no meat behind the bids. I could be wrong, but that is the sense I am getting as we get into the final hour. No one wants to be the last sucker without a chair.

Jeff Bailey : 9/28/2006 3:02:50 PM

03:00 Market Watch found at this Link

Jeff Bailey : 9/28/2006 2:58:34 PM

SPX Link ... some recent tweezers have been "displeezers."

Marc Eckelberry : 9/28/2006 2:54:39 PM

I don't really get into the boyz thing. The function of window dressing, especially on the low volume we have seen, is that of incompetent funds who did not buy stocks like INTC in July and are now scrambling to put it on their books, no matter what. Basically, the good fund managers were already long weeks ago and are now probably offloading some inventory to the laggards. If you could find out which funds are buying these last few days, those are the ones you want to avoid like the plague. They are morons of the Street which only care about their fees, not even performance. They sell at lows and buy at highs and there is nothing dumber out there than that group. But they have money and they can move a market, not out of design, but basically because they are late to the game and need to show some degree of intelligence. Once you understand that, you can figure out how to play it. This churning at highs is exactly that: inventory offload versus late and somewhat desperate performance chasers. You can make money follwing the late buyers, that's for sure, but the real money was made by those who bought in July.

Jeff Bailey : 9/28/2006 2:53:13 PM

7:1 upTick/dnTick on the SPX Oct. 1,300 Puts (SXY-VT) ... Best guess here is they are playing the "tweezer top"

Jeff Bailey : 9/28/2006 2:47:58 PM

AmeriTrade (AMTD) $18.84 +1.29% Link ... 200-day SMA held resistance on Tuesday.

Jeff Bailey : 9/28/2006 2:44:38 PM

Goldman Sachs (GS) alert $170.00 +0.57% Link ... All-time high. X gets the square.

Jeff Bailey : 9/28/2006 2:43:02 PM

So obvious isn't it Keene. Why are traders so bearish then?

Keene Little : 9/28/2006 2:30:45 PM

The Boyz need to push this up so that the DOW closes in new high territory. That way Mom and Pop will start pouring in tomorrow on the bullish news, just in time for the Boyz to start handing off their inventory. It's the way it's always worked. Makes you wonder how they sleep at night, or look themselves in the mirror and think they're doing a good thing.

Jeff Bailey : 9/28/2006 2:14:05 PM

QM traders ... slap a high/low settle retracement on the December contract. Yes... even if your ONLY watching the November.

That will also mirror the USO.

Marc Eckelberry : 9/28/2006 2:10:41 PM

Watch QM. If it drops, it will be the excuse to ramp up ES into the close.

Marc Eckelberry : 9/28/2006 2:08:52 PM

ES has resistance at 1348, 1349.25 and 1350. Patient traders should wait for a stop run push and hit it short. The post close should see some selling.

Marc Eckelberry : 9/28/2006 2:09:58 PM

The overall impression is that the weeklong rally is pretty much over. They will probably try to push it up a little an hit some stops, but if you can stomach wide stops, we should pullback soon. The SOX is up thanks to INTC and TXN, the mega caps of technology, but many smaller players are weakening.

Jeff Bailey : 9/28/2006 2:05:06 PM

Here ... I'll update the sector bullish %, then type in the seasonal sectors. Get it all on one page that we can come back to.(see Friday's MM 04:03:43, 03:43:21, 03:45:28, 03:47:11) Link

Jeff Bailey : 9/28/2006 1:51:38 PM

Dorsey/Wright's FOREest Products/Paper sector bullish % reversed back up to "bull confirmed" status yesterday at 54%. In May it was 72%, then fell to subsequent 48%.

Was that one of the "sector seasonalities" from The Stock Trader's Almanac?

Jeff Bailey : 9/28/2006 1:41:25 PM

Been eyeballing some UPS $72.62 +0.30% Link ... but as bullish as I have been, I'm always cautious of trend.

Jeff Bailey : 9/28/2006 1:39:23 PM

Thought of that as I see Construction/Raw Materials as industry winner today ... +1.53%.

Retail technology -0.99% and Air Courier -0.96% are losers.

Jeff Bailey : 9/28/2006 1:36:33 PM

I've been trying to find a handy person for some maintenance projects and so far, "booked for 1.5 months" is the general theme.

Keene Little : 9/28/2006 1:34:48 PM

So far the 60-min chart shows a very shallow correction that the Boyz let the market do before jamming it higher again.

Keene Little : 9/28/2006 1:33:18 PM

A jump up to ES 1350 would be a retest of the high as well as its broken uptrend line from Monday so watch for resistance there. But the overall impression of the sideways consolidation since yesterday's high is bullish and another pullback could then lead to a push to new highs. The alternative would be a fast drop out of what looks like a bull flag formation (failures of more obvious patterns like that usually result in a fast move the other way). Too tough to call here.

Jane Fox : 9/28/2006 1:21:46 PM

TICKS +1000

Jeff Bailey : 9/28/2006 1:18:08 PM

01:00 Internals found at this Link

Jeff Bailey : 9/28/2006 1:05:08 PM

01:00 Market Watch found at this Link

Jeff Bailey : 9/28/2006 12:54:25 PM

IWM $72.40 -0.71% ... should we close $72.50 tomorrow and given September's High/Low, then October's MONTHLY Pivot Levels would be ... $67.99, $70.24, Piv= $71.91, $74.16, $75.83

Keene Little : 9/28/2006 12:35:06 PM

I can't help but feel the bears are being toyed with here--drop it enough to make people think the top is in and then hit it with a few strong buy orders to get them to cover so as to help lift the market to new highs.

Jane Fox : 9/28/2006 12:34:05 PM

Nat GAs to another yearly low.

Jane Fox : 9/28/2006 12:30:20 PM

Did anyone notice ES's daily lows matched its PDL exactly.

Keene Little : 9/28/2006 12:26:21 PM

The ascending wedge for the RUT shows an over-throw on Sept 20-21, a drop back down towards the bottom of the wedge and then a bounce back up to the top with a retest and failure (kiss goodbye) today. Looks like a good sell signal there. Link

Jane Fox : 9/28/2006 12:24:25 PM

NOW the vix is making new daily highs and my short is in much better shape.

Jeff Bailey : 9/28/2006 12:19:57 PM

I'm noticing the small-cap "lag" too Keene.

For the remaining IWM calls position, one thing I would want to see is the similar "dynamic" we've seen where software gained, semiconductors lagged, then software has calmed down a bit, but semiconductors then gained.

I was looking at the 5-day, 10-day and Year Net % in the U.S. Market Watch today.

Jane Fox : 9/28/2006 12:19:17 PM

VIX never did make a new daily high and sure enough ES's new daily lows did not hold.

Keene Little : 9/28/2006 12:13:26 PM

Techs and small caps appear to be weaker today and could be giving us a heads up that we're topping. In fact looking at NQ's 15-min chart shows a rounding top with clear negative divergences. This is usually a very reliable sell signal. Just watch out for whipsaws today as Big Money tries to jam the DOW higher for the media event. Other stocks could easily get dragged higher as well.

Jeff Bailey : 9/28/2006 12:05:25 PM

Exxon/Mobil (XOM) $67.46 +0.49% ... tries to reclaim its 50-day SMA.

Jeff Bailey : 9/28/2006 12:04:05 PM

U.S. Oil Fund (USO) $57.96 +1.39% ... works its way above WEEKLY R1, gets the trade at my 19.1% (pink) retracement (07/14 high to recent 09/25 low)

Jane Fox : 9/28/2006 12:01:59 PM

There goes ES to new daily lows but the VIX is not making a new daily high. I am hoping this is one of those days when the VIX is a tad late.

Tab Gilles : 9/28/2006 11:58:43 AM

$NASI On the 26th post 12:59 AM , I showed a chart of the weekly $NASI, where it appeared to give a bearish signal. I'd stated that this maybe a head fake. Well last night I brought up the chart and sure enough it was. It is still in bull mode. BUT... look at the MACD on the weekly? It appears to be topping and could signal nearterm a sell. We may get the same type of market move as back in the fall of 2004. My other indicators are not giving an outright sell as of yet, especially on the $NAHGH/$NALOW weekly 10-emas. Link

Jane Fox : 9/28/2006 11:53:18 AM

... sorry stop at 1347.75.

Jane Fox : 9/28/2006 11:53:02 AM

I am going to try an ES short here with a stop at 1347.50

Jane Fox : 9/28/2006 11:51:40 AM

Jeff noted a sell program but the TICKS didn't get much past -350.

Keene Little : 9/28/2006 11:51:34 AM

ER is close to giving a sell signal based on a break down from the parallel channel from Tuesday (736.20). Another new low today (close to doing it as I type) will give us a small 5-wave move down so a corrective bounce following this which is then followed by another new low would be convincing evidence that we've seen the high. Link

Jane Fox : 9/28/2006 11:50:24 AM

Oh well so much for my Natural Gas long speculation - it just made new yearly lows. My real long Oil is doing just fine though.

Jeff Bailey : 9/28/2006 11:48:01 AM

Sell Program Premium ... SPY $133.54 : YM 11,747

Tab Gilles : 9/28/2006 11:37:09 AM

I'm adding several stocks to my MM Watch List.

Alkermes (ALKS), Gold and Silver ETF (GLD) (SLV) and Profund Precious Metals (PMPIX). Link

ALKS is a biotech. Link Link

Jane Fox : 9/28/2006 11:32:16 AM

* NYSE VOLUME 511.2M
* NYSE HAS 1,473 ADVANCERS
* NYSE HAS 1,541 DECLINERS
* NYSE HAS 181 ISSUES UNCHANGED
* NYSE HAS 116 ISSUES SETTING 52-WEEK HIGHS
* NYSE HAS 11 ISSUES SETTING 52-WEEK LOWS
* NASDAQ VOLUME 679.5M
* NASDAQ HAS 1,250 GAINERS
* NASDAQ HAS 1,488 LOSERS
* NASDAQ HAS 158 ISSUES UNCHANGED
* NASDAQ HAS 79 ISSUES SETTING 52-WEEK HIGHS
* NASDAQ HAS 46 ISSUES SETTING 52-WEEK LOWS

Jeff Bailey : 9/28/2006 11:29:49 AM

U.S. To Sell $31.0 Billion T-Bills Monday vs. $34.0 Billion

DJ- The Treasury plans to raise about $2.00 billion in new cash with the sale on Monday of about $31.00 billion in short-term bills to redeem $29.00 illion in outstanding debt.

The sale amount is down from $34.00 billion sold at the previous weekly three- and six-month T-bill auction.

The offering will include $16.00 billion of 13-week bills, and $15.00 billion of 26-week bills, which will be dated Oct. 5 and will mature Jan. 4, 2007, and April 5, 2007, respectively.

The Federal Reserve holds $16.82 billion of maturing bills for its own account. It will likely roll over its holdings into new bills at either Monday's three- and six-month bill auction or Tuesday's four-week bill auction.

Noncompetitive tenders for the bills, available in minimum denominations of $1,000, must be received by noon EDT on Monday. Competitive tenders for the bills, available in minimum denominations of $1,000, must be received by 1 p.m. EDT on Monday.

The CUSIP number for the three-month bills is 912795YM7, and the CUSIP number for the six-month bills is 912795ZA2.

Jane Fox : 9/28/2006 11:28:00 AM

Kansas City Fed Manufacturing Survey "Growth in manufacturing activity in the Tenth Federal Reserve District slowed in September, but activity was still well above year-ago levels and plant managers remained optimistic about future growth. Materials price pressures eased somewhat, but finished goods price increases were expected to persist."

Thanks Linda.

Jane Fox : 9/28/2006 11:24:43 AM

And Gold now breaks its overnight highs.

Jeff Bailey : 9/28/2006 11:19:43 AM

11:00 Internals found at this Link

Jane Fox : 9/28/2006 11:13:52 AM

... and then Natural Gas?

Jane Fox : 9/28/2006 11:13:33 AM

Oil is the first to break its overnight highs, I suspect Gold will follow.

Jane Fox : 9/28/2006 11:08:29 AM

So much for my bearishness.

Jane Fox : 9/28/2006 11:08:10 AM

BTW don't look now but TRIN is falling to new daily lows.

Jane Fox : 9/28/2006 11:07:39 AM

Those bulls are just too strong even when the internals are telling you otherwise.

Jane Fox : 9/28/2006 11:07:12 AM

I didn't take ES short and am quite glad of it now.

Jane Fox : 9/28/2006 11:06:31 AM

Gold is now on its way up as well and about to test overnight highs. Oil is still struggling with its overnight highs but this consolidation at highs is bullish and suggests higher highs. I am long Oil.

Jane Fox : 9/28/2006 11:04:55 AM

I am going to benchmark Natural Gas and see if I was right in my call to go long. Acutally GAs has moved up a bit but right now it is 5.61. I am using the emini QN (November).

Jeff Bailey : 9/28/2006 11:02:23 AM

11:00 Market Watch found at this Link

Keene Little : 9/28/2006 11:00:34 AM

For this morning's pullback, two equal legs down at ES 1343.25 would essentially be a retest of yesterday's low. That's a must-hold level for the bulls.

Jane Fox : 9/28/2006 10:56:07 AM

This is also probably a good place to go long Natural Gas for a short (time wise short) daytrade.

Tab Gilles : 9/28/2006 10:56:10 AM

Tony Dwyer, equity market strategist at FTN Midwest Research was just on CNBC this morning. He commented that the DJIA historically, when making a new high in Sept. historically was followed by a decline of 1 to 5% in October followed by a 10% rally. His advice...was to not chase this rally but to wait for a pullback to add or buy.

Jane Fox : 9/28/2006 10:55:28 AM

Oil is now testing overnight highs.

Jim Brown : 9/28/2006 10:55:09 AM

CHK to shut in 100 mmcf of gas until prices recover Link

Jane Fox : 9/28/2006 10:54:45 AM

Maybe we need Oil to make new daily highs to give the bears the push they need.

Jane Fox : 9/28/2006 10:53:42 AM

I really want to short this market and the internals are telling me it is almost time but I still feel the bulls influence and they are just not letting go.

Jane Fox : 9/28/2006 10:50:01 AM

ES's new daily low is not confirmed by a VIX new daily high so I would not be jumping on it quite yet.

Jim Brown : 9/28/2006 10:50:09 AM

I got short the ER at 739 and I am planning on remaining short for several days from the 739-740 level. I believe the tape painters will eventually lose the battle and next week could see a serious dump. If they rally them again I will exit over 740 and reenter on the next failure. 720 would be my initial target with 705 as an ideal October dip low.

Jeff Bailey : 9/28/2006 10:48:29 AM

AMEX Nat. Gas Index (XNG.X) 411.54 +0.11% Link

Jeff Bailey : 9/28/2006 10:47:00 AM

Baker Hughes (BHI) $57.69 -0.17% Link

Jeff Bailey : 9/28/2006 10:46:01 AM

Gas Group: U.S. May See More Production Shut-Ins

Natural Gas Shut-Ins Won't Be Widespread

Jane Fox : 9/28/2006 10:43:48 AM

Both AD line and volume are making new daily lows and that is never bullish. Another day to just sit out so far.

Jim Brown : 9/28/2006 10:42:56 AM

Dow breaking under 10700. Nasdaq and SPX negative. Will the last bull out please turn out the lights.

Keene Little : 9/28/2006 10:41:22 AM

The "bounce" off this morning's low is very corrective and suggests a break lower soon. But it could all just be part of a larger choppy push to the north. Yesterday's low is the critical one.

Jim Brown : 9/28/2006 10:40:19 AM

ER finally broke support at 738.

Jeff Bailey : 9/28/2006 10:40:19 AM

U.S. Oil Fund (AMEX:USO) $57.17 +0.01% ... WEEKLY R1 just above at $57.74.

Jane Fox : 9/28/2006 10:39:59 AM

Both AD line and AD volume break back below 0.

Tab Gilles : 9/28/2006 10:39:01 AM

[followup to 8/29 3:34 PM chart]

Daily annotated... Link Weekly... Link PnF.... Link

Jeff Bailey : 9/28/2006 10:38:02 AM

Nat. Gas Inventories up ~12.8% from year-ago.

Winter heating season and draws usually begin mid-November.

Jeff Bailey : 9/28/2006 10:32:40 AM

EIA Weekly Nat. Gas Storage Table found at this Link ... Build of 77bcf

Jane Fox : 9/28/2006 10:32:19 AM

* NATURAL GAS SUPPLY UP 77 BLN CUBIC FEET: ENERGY DEPT.

Jim Brown : 9/28/2006 10:32:19 AM

Nat gas for this week +77 BCF: Link

Jane Fox : 9/28/2006 10:30:42 AM

Natural Gas rallying.

Jim Brown : 9/28/2006 10:29:19 AM

The tape painters are struggling to keep the indexes pinned to the highs for quarter end. Looks like they may lose the battle.

Jane Fox : 9/28/2006 10:26:26 AM

The internals were not in sync yesterday but at least the AD line and volume were bullish. Today the internals are NOT talking to me again but these two are much less bullish. Link

Jeff Bailey : 9/28/2006 10:20:59 AM

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

Jane Fox : 9/28/2006 10:19:26 AM

On January 14, 2000 the DOW closed at 11722 with a high of 11749. Today's high has exceeded that close but not the high.

Jane Fox : 9/28/2006 10:15:13 AM

If you trade Natural GAs remember the inventories are out at 10:30 and I would not be in a trade around that time.

Jane Fox : 9/28/2006 10:14:33 AM

TKs Jim could not find those results anywhere.

Jim Brown : 9/28/2006 10:13:54 AM

Help Wanted Index 31 vs 32 last month

Jane Fox : 9/28/2006 10:13:48 AM

Gold is now breaking its overnight lows.

Jane Fox : 9/28/2006 10:11:30 AM

I have now checked multiply websites and they all say Help Wanted Index at 10:00 but can find no mention of the results in the newswires.

Jeff Bailey : 9/28/2006 10:04:06 AM

10:00 Market Watch found at this Link

Jane Fox : 9/28/2006 10:01:47 AM

AD line has dropped to +195

Jane Fox : 9/28/2006 10:01:19 AM

AD volume below 0 now.

Jane Fox : 9/28/2006 10:01:05 AM

VIX and AD volume are telling me the bull's party is over for awhile.

Jane Fox : 9/28/2006 9:55:46 AM

Remember the August Help wanted Index at 10:00 although not a market mover.

Keene Little : 9/28/2006 9:51:09 AM

If on the other hand we see a drop below yesterday's low then the bears could be gaining the momentum.

Keene Little : 9/28/2006 9:50:36 AM

The pattern from the low on Sept 22nd is a little funky looking (gee, I don't know why since it's all false buying) but if we're into the final 5th wave up and it chops its way higher to form a small ascending wedge, which I suspect it would, then the current pullback will lead to another stab higher, pull back and then a final push higher.

It'll be choppy and very difficult to trade (whipsaws). Considering the battle that's going to go on here, this kind of price action would be very typical. It's a time for greater caution than usual.

Marc Eckelberry : 9/28/2006 9:45:42 AM

Some topping signs creeping in. Watch ES 1347.25.

Keene Little : 9/28/2006 9:39:43 AM

Both SPX and DOW are holding up so far. Looking at the short term parallel up-channel for the DOW shows the potential to rally up to 11800 today in order to reach the top of its channel. The champagne corks would be poppin'. I'm keeping an eye on the 11743-11764 area as I've got several internal Fib projections in that area as a potential target and end for this rally. This is the chart I showed yesterday so it'll be interesting to see what happens today. Link

Jane Fox : 9/28/2006 9:38:53 AM

EGADS TICKS +1000 haven't seen TICKS this bullish this early for ages.

Jane Fox : 9/28/2006 9:38:15 AM

Both VIX and TRIN open in their previous day ranges.

Jane Fox : 9/28/2006 9:36:35 AM

Ad line +905 and AD volume climbing - the bulls have the ball this morning

Marc Eckelberry : 9/28/2006 9:31:41 AM

Watch the DOW and 11700, 11720 and 11750.

Marc Eckelberry : 9/28/2006 9:24:54 AM

I'm thinking one blow-off to wipe put more shorts and then a flat day on Friday, and selling on Monday. They will need a drop in QM, and they might get it, at least temporarily. As long as ES 1347.25 holds, they will go for it.

Marc Eckelberry : 9/28/2006 9:19:11 AM

GM is my favorite auto company long term. Right now, it needs to get rid of some weight, but it has the future locked up technologically.

Marc Eckelberry : 9/28/2006 9:18:01 AM

If you are thinking this is the end of window dressing and that it is time to load up short, just know that you are not the only one.

Jane Fox : 9/28/2006 9:15:58 AM

Dateline WSJ - Kirk Kerkorian aims to boost his stake in GM to more than 10%.

Marc Eckelberry : 9/28/2006 9:15:42 AM

ES still stuck below 1348, weekly R2.

Jane Fox : 9/28/2006 9:15:22 AM

Marc I have been daytrading Natural Gas and have found it a wonderful daytrading vehicle as well.

Keene Little : 9/28/2006 9:15:00 AM

In our continuing "wedge watch" SPX dipped back below the top of its wedge but then bounced slightly into the close to remain on top of its wedge. It could be classified as a successful retest of the line as support if it continues higher today. The DOW also dropped back below the top of its wedge and then bounced up to but stopped at the line. If it drops today then that could be considered an unsuccessful retest of the line (kiss goodbye).

We're still in EOM/EOQ tape-painting but using the 3-day settlement window allows funds to start selling stuff they don't want and it won't show up on the books until next week. Therefore the tape-painting might be mostly done. It's all speculation this week since we really don't know what's on the minds of Big Money so we watch and we wait to see if the market gets propped up further.

Marc Eckelberry : 9/28/2006 9:12:08 AM

It's just a question of how resolved they will be. QM is a daytrading vehicle, with great opportunities for wild gains and losses. Trade it, but understand it.

Marc Eckelberry : 9/28/2006 9:11:05 AM

QM support is 62/62.20 where buyers will step in.

Jane Fox : 9/28/2006 9:10:35 AM

Here is a 240 minute of OIl and as you can see it is overbot so I would wait for a revisit back to the downward trendline before attempting a long position. Link

Marc Eckelberry : 9/28/2006 9:10:24 AM

The dollar is rising and oil is dropping, but these are modest moves so far. YG could see a pullback after 7 straight up days, but I suspect it will be minor. There is a gap fill at 603 and 5 dma support at 600. Must hold is 597. Upside resistance is 610, 617, 623.

Jane Fox : 9/28/2006 9:08:40 AM

Notice how Oil has broken the downward trendline and has broken back above 30 RSI? This is bullish and suggests a nice bullish run. Doesn't mean this market is bullish just that it is relieving its oversold condition and could run all the way back to resistance at 71.00 or at least to the 200EMA. In any case that could be nice trade. Link

Marc Eckelberry : 9/28/2006 9:07:02 AM

Watch NQ 1683, 1685 and 1692, ES 1350, 1356 and 1359, COMP 2272.70, 2283 and 2290 all resistance. Support is yesterday lows, must hold for bulls.

Marc Eckelberry : 9/28/2006 9:00:37 AM

Once we are done with window dressing, they will stop talking about lower rates as being a positive and it will switch to worries about a slowing economy.

Marc Eckelberry : 9/28/2006 8:59:08 AM

Sept. 28 (Bloomberg) -- U.S. economic growth slowed to a weaker-than-expected annual rate of 2.6 percent in the second quarter, reflecting a slackening in business spending, consumer demand and homebuilding that may carry into 2007... ...Residential construction fell the most since 1995 last quarter, while smaller home equity gains limited consumer demand and businesses reduced expenditures on computers and software. The economy will be hard-pressed to accelerate from the second quarter pace by year-end... ...Home construction fell at an annual rate of 11.1 percent last quarter, compared with a 9.8 percent drop reported last month and a 0.3 percent decline the first three months of 2006. Reports this month suggest the housing slump is deepening as the supply of unsold homes swells... ...Business fixed investment, which includes spending on commercial construction as well as equipment and software, grew at a annual rate of 4.4 percent in the second quarter, compared with a 4.7 percent gain reported last month and a 13.7 percent increase the first three months of the year. Spending on equipment and software fell at an annual rate of 1.4 percent, the biggest drop since the end of 2002, revised from a 1.6 percent decline. Link

Jane Fox : 9/28/2006 9:04:36 AM

Everything is riding on if the bulls can break this resistance. I see a possible retracement here and then another run at resistance, however, if they break this resistance today that shows us the bulls are a lot stronger than I previously thought. Link

Jane Fox : 9/28/2006 8:54:28 AM

TBonds didn't like the GDP data and made new overnight lows breaking its PDL at the same time.

Oil, Gold and Natural Gas were all bullish overnight suggesting higher highs intraday. Link

Jane Fox : 9/28/2006 8:54:45 AM

Equity markets didn't seem to react too strongly to the GDP data out at 8:30 and mostly remained neutral. Link

Jane Fox : 9/28/2006 8:43:39 AM

WASHINGTON (MarketWatch) -- First-time claims for state unemployment benefits fell by 6,000 in the latest week, sinking to 316,000, the Labor Department said Thursday.

Continuing jobless claims, meanwhile, fell by 8,000 to stand at 2.44 million, the lowest level seen since July 22.

Initial claims represent job destruction, while the level of continuing claims indicates how hard or easy it is for displaced workers to find new jobs.

First-time claims for the week ended Sept. 16 were revised to 322,000 from 318,000. Read the report.

The four-week moving average of new claims fell by 500, to 315,500, for the week ended Sept. 23.

Jane Fox : 9/28/2006 8:42:59 AM

WASHINGTON (MarketWatch) - Second quarter U.S. growth increased at a 2.6% rate, slightly lower than previous estimates of a 2.9% growth rate, the Commerce Department said Thursday.

The downward revision was unexpected. Economists surveyed by MarketWatch had been forecasting second-quarter GDP to remain unrevised at a 2.9% rate.

Economic growth has averaged a 3.6% rate over the past four quarters. The economy expanded at a 5.6% rate in the first quarter.

The revisions to second-quarter GDP were largely due to lower inventory investment and a worsening trade balance.

Final sales of domestic product increased 2.1%, down from 2.3% in the previous estimate.

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