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Jeff Bailey : 9/30/2006 12:33:22 AM

Amaranth: Funds' Asset Value Down 65%-70% In September

Funds' Asset Value Down 55%-60% Year To Date

Jeff Bailey : 9/29/2006 10:23:02 PM

RIMM exploded today Link and GRMN may be next.

Jeff Bailey : 9/29/2006 10:22:03 PM

Garmin Ltd. (GRMN) $48.78 +0.49% Link ... would like to buy this stock/options on any pullback to $45-$46.

Tab Gilles : 9/29/2006 10:10:24 PM

Open Positions Link

$NDX Link

$NAHL Link

$NALOW Link

$NALOW & $NAHGH w/weekly 10-ema/UOPIX Link Link

Profund UltraOTC (UOPIX) Link

Enjoy the weekend everyone!

OI Technical Staff : 9/29/2006 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The Market Monitor has been archived.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.

Marc Eckelberry : 9/29/2006 9:09:42 PM

The reality is simple: most people who put their money back to work in January, exited at a loss in May/June/July as they were told to do (it was all over the press and the trading sites)and when the rally took off, they were on vacation. (Heck, I even remember Cramer telling you to sell INTC at 17 and buy oil and energy at 75). When they came back in September, if they were brave and did not listen to the spin about September and mid-term elections, they caught a small part of the rally, but I doubt it made up for their earlier losses. That is the plain cold truth and why everyone is disgusted with hedge funds and Wall Street in general. And they should be. The spin machine did everything to get you out at the lows and everything to get you in at the highs.

Marc Eckelberry : 9/29/2006 9:00:08 PM

For the Year:
QQQQ: + 0.5%
SMH/SOX: -6%

GE + 0.5%
IBM -0.3%
INTC - 17%

There have been some great moves, like any year, but I suspect many investors did not do as well as this quarter might indicate. If you bought the DOW and SPX at the beginning of the year and had the courage to hold on in May, you did great. I doubt many did that. The overall volume of this rally indicates not many participated, whereas everyone got out in May and June and took huge losses. The layman I talk to has little interest in investing in the stock market, hedge funds have ruined the business for everyone. It is not stable enough. They tell everyone to have stop losses, so basically, either you traded full time and did the right moves, or you held on with no stops and hoped to make out. But everyone who had discpline and stops was out in May/June and the volume shows that very few returned.

Jeff Bailey : 9/29/2006 8:34:48 PM

For the Third Quarter!

INDU +528.85, or +4.7%

SPX +65.62, or +5.2%

OEX +40.47, or +7.0%

NDX +78.90 +5.0%

SMH $+1.38, or +4.2%

BIX +19.49%, or +5.2%

RUT +0.92, or +0.1%

DX00Y +0.81, or +1.0%

Jeff Bailey : 9/29/2006 8:34:44 PM

For the Month!

INDU +297.92, or +2.6%

SPX +32.03, or +2.5%

OEX +18.00, or +3.0%

NDX +74.40, or +4.7%

SMH $+0.20, or +0.6%

BIX +11.52, or +3.0%

RUT +5.06, or +0.7%

DX00Y +0.92, or +1.1%.

Jeff Bailey : 9/29/2006 8:34:38 PM

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

Today's Activity

Closed out the remaining iShares Russell 2000 IWM Jan $71 Calls (DIW-AS) at the bid of $4.70 with IWM trading $72.55. ($+1.10/contract, or +30.56%)

Trade Blotter of CLOSED TRADES since 08/01/06 to 09/29/06 and CURRENTLY OPEN TRADES with stops/targets at this Link

It has been several months since a "loss" has been found on the no risk management side of the trade blotter, where 1,000 shares of a security might be bought/shorted. Note how that side of the blotter has just one trade impacting the bottom line, where a risk managed approach to how a position size must be determined can be recovered from, or at least not blow up your account.

Jeff Bailey : 9/29/2006 7:53:25 PM

Closing U.S. Market Watch (End of Q3) found at this Link

Jeff Bailey : 9/29/2006 7:24:26 PM

NASDAQ NH/NL ratio chart with "f"ive day and 10-day (X,O) at this Link

Jeff Bailey : 9/29/2006 7:03:36 PM

NYSE NH/NL ratio chart with "f"ive day and 10-day (X, O) at this Link

Jeff Bailey : 9/29/2006 7:03:30 PM

Closing Internals found at this Link

From 09/11/06 to tonight's close, NYSE average daily volume was 2.55 billion shares per day, which is up 16% from August's 2.19 billion share per day average.

From 09/11/06 to tonight's close, NASDAQ average daily volume was 2.00 billion shares per day, which is up 18% from August's 1.69 billion share per day average.

Tonight I'm going to color the 10-day NH/NL ratios green.

Here's my data set, where I didn't have NH/NL readings for three days. Jane did send me the NH/NL for a couple of days while I was out. Data Set Link

I color "shaded light blue" figures as those ratios aren't necessarily accurate due to missing data.

So, when I now pick up from 08/31/06 this is how I'm going to chart the

NYSE 5-day, 10-day ratio chart. For the 5-day NH/NL ratio, I'm going to assume that the 5-day NH/NL ratio "peaked" at 86.00 (on a 2-point box chart, 87.7 and 87.5 wouldn't have been enough for 88.00), then fell to a recent inflection low of 76.00 on 09/25/06, and have recently reversed back up 3-boxes (6%) to 86.00. For the NYSE 10-day NH/NL ratio, I'm going to assume it is still sitting at an 84.00 reading.

For the NASDAQ's 5-day NH/NL ratio, it was rising to 58.00 as I left on vacation. I'm going to assume it rose to 66.00 on 09/18/06, reversed lower 3-boxes (6%) to an inflection low of 48.00 on 09/25/06 and has now build a column of X back up to 56.00. For the NASDAQ's 10-day NH/NL ratio, it gave its first "buy signal" since this spring on 08/25/06 and when I left on vacation had risen to 48.00. I'm going to assume it has recently hit an inflection high of 56.00 on 09/25/06.

Jeff Bailey : 9/29/2006 5:21:42 PM

Should be a good battle for the readers to follow. Perhaps help get another "read" on things. (Why might a bull hold, or take profits? Why might a bear short?)

At the beginning of the day, it was Tab and I that were still bullish the small caps.

Turns out Jim and Jane are bearish/short.

I decide via my MM profiles that near-term risk/reward not all that great and decide to protect gains.

Small cap bull/bear .... 1:2 now.

Is that the way the MARKET will trade? Stay tuned.

Jeff Bailey : 9/29/2006 5:16:10 PM

Jim ... thanks for the update (04:26:29). Readers will echo that I'm sure.

Don't "quit" without letting me know. I shorted 60 contracts (grin), stop 741. (Disclosure: I do not hold a bullish, or bearish position in the IWM, or ER)

Again... I'm "new" to this trading stuff. Been hearing all about these new record highs, but the newspapers are just full of negative stuff regarding inflation and housing.

Marc Eckelberry : 9/29/2006 5:10:19 PM

There, they pushed one contract up to close YG at 604.30, above 20 dma and 200 ema. Target is still 623 if we hold 602/604 Monday.

Marc Eckelberry : 9/29/2006 4:52:30 PM

Sept. 29 (Bloomberg) -- OPEC, seeking to stem a two-month slide in oil prices, said Venezuela and Nigeria will cut crude production by a combined 170,000 barrels a day.

Jim Brown : 9/29/2006 4:51:07 PM

Marc, I beleive you are right. See you Sunday night! Everybody have a good weekend!

Marc Eckelberry : 9/29/2006 4:51:30 PM

My take is that the internals are far more bearish than ES futures made it seem. I took a short at the close (1346) and I think we will have a big gap down open Monday. The SOX has been a continued non-participant and the COMP did far worse than a hanging man, it actually closed at lows and below its 5 DMA indicating momentum could be shifting. In any case, it's worth a small risk into Sunday to start hitting it now. Gold looks to close above the 20 dma, that pullback was minor and oil is on a tear. I will check in on Sunday and update pivot and MA trading scenarios.

Jim Brown : 9/29/2006 4:43:13 PM

I know you are new. Maybe in a couple more years you will get the hang of it. (grin) I posted the entry several times so others could follow.

Jeff Bailey : 9/29/2006 4:36:03 PM

Jim! I'm "new" to the market monitor and didn't see your entry point yesterday. Any chance of putting together a trade blotter of OPEN positions with stops and targets?

Jim Brown : 9/29/2006 4:26:29 PM

Jeff, my ER targets as I stated in my entry comments on Thursday were ER 720 as an initial target and 705 as a possible. I could quit now and my four contracts would be worth +$3600 but I think we are going lower. Link

Jane Fox : 9/29/2006 4:22:26 PM

Have a good weekend everyone.

Jane Fox : 9/29/2006 4:20:05 PM

Jeff - a double or ER at 719 whichever comes first.

Keene Little : 9/29/2006 4:19:51 PM

Well, based on the pattern I just showed for ES, my best guess is an early morning dip on Monday (pull in some shorts) followed by another Yahoo short-covering rally to finish off the whole thing with a new high. I hope everyone has a great weekend and I'll see you Monday.

Jane Fox : 9/29/2006 4:18:28 PM

Economic Reports for Monday:

10:00a.m. Aug Construction Spending. Previous: -1.2%.

10:00a.m. Aug Pending Home Sales Index. Previous: -7.0%.

10:00a.m. Sept ISM Manufacturing Business Index. Previous: 54.5.

Jeff Bailey : 9/29/2006 4:17:46 PM

Well... what is your (Jim/Jane) downside targets?

Jim Brown : 9/29/2006 4:15:20 PM

Jeff, Definitely no argument from me. That is why I am personally in the Russell futures short!

Jeff Bailey : 9/29/2006 4:13:17 PM

Jane! ... I was thinking the exact same thing when Jim mentioned DIA puts.

At least with IWM, a bear has a pretty clear level to trade against for a stop. At all-time highs, that's trouble for a bear with no overhead supply.

Jim Brown : 9/29/2006 4:12:07 PM

A reader emailed me this note after I posted the Dow fund symbols earlier. It is definitely worth noting if you were planning on day trading them. Long term OK but probably not short term. Thanks AW.

A note of caution with the Proshares. I have been watching them recently, particularly the S&P related shares and they tend to be somewhat thinly traded. Not the type of action that allows larger trades( multiple 100's of shares) at market for sure. If you look at 5 min charts, you will see intervals of no trades on especially the SSO. The SDS (short) has been showing better volume.

Jeff Bailey : 9/29/2006 4:11:14 PM

I think I covered some of that two weeks ago with the XBD.X. I think that should have been a standing 8 count for bears.

Jane Fox : 9/29/2006 4:07:43 PM

Jim I took you suggestion yesterday about the DIA puts but bot IWM puts instead. It looked to me ER was the more bearish market. In any case thank you!

Jim Brown : 9/29/2006 4:08:26 PM

Jeff, I hope we all get a chance to hit some bullish home runs. It is all a matter of timing and choosing your pitch. I am just hoping the highs this week are not leading to a repeat of the May debacle.

Jeff Bailey : 9/29/2006 4:05:17 PM

Did someboday say "fight left in him?"

You bears haven't seen anything yet. This week I was looking for the "pullback" buy day of Tuesday and markets chugged higher.

I'm looking to hit all these "curve balls" out of the yard real soon.

Jim Brown : 9/29/2006 4:02:36 PM

He had been so quiet since the afternoon decline started I thought he had jumped out a window. Nice to see he still has some fight in him. (grin) Just kidding Jeff!

Keene Little : 9/29/2006 4:00:12 PM

Thanks Jim and Jeff. I've got to go off and bandage my ribs from Jeff though ;-)

Keene Little : 9/29/2006 3:58:25 PM

The drop into the close is actually renewing my concern that we'll see a ramp up on Monday, just to be sure the bears are taught another lesson. This ES 15-min chart zooms in a little on the chart I posted earlier this morning (10:06) and shows how the leg down this afternoon could be the one completing the 3-day consolidation. Link

This wave count calls for a rally out of this but it could be the last leg up in the wave count. It suggests a pop higher to stop out shorts which would be then be followed by the start of the decline.

Jim Brown : 9/29/2006 3:58:24 PM

Keene, That was a good wrap!

Jeff Bailey : 9/29/2006 3:58:34 PM

Keene ... just reading your Market Wrap of last night. Fantastic! However, I'll "fix" some of those blue arrows to compensate for what the brokers did from similar looking setups a couple of weeks ago. (jab.. jab)

Jim Brown : 9/29/2006 3:54:57 PM

My ER short from 739 yesterday is looking pretty good right now. I hope some of our readers followed my trade. I also profiled the DJX $117 puts twice. You still have a chance for those in the next 6 min. Link Link

Keene Little : 9/29/2006 3:45:10 PM

Uh oh, is that my coffee spilling?

Keene Little : 9/29/2006 3:36:14 PM

OK, 30 mins to go. Which way are they going to run this (if not flat out the door). I say run the cash indices higher into the close and then sell off in the futures after 16:00. I'll bet the cost of a cup of coffee on that since I'm not putting my money into this market today. I've already positioned myself short and don't want to see SPX 1350 (actually 1352 is another Gann number and the max I'll let it get to before stopping out).

Jim Brown : 9/29/2006 3:32:33 PM

If there are going to be any closing fireworks it is time for somebody to light the fuse.

Jim Brown : 9/29/2006 3:30:47 PM

Tab, those are good resources. Thanks for posting for our readers.

Tab Gilles : 9/29/2006 3:29:19 PM

Jim, besides Profunds, I've mentioned Proshares for intraday trading. Link Link

Don't know if you caught my post on the $INDU peak in 2000 as compared to today's $INDU. Recall the Dow lost T, EK, Ip back on April 14, 2004, added AIG, PFE and VZ. With the 2000 Dow 30 the average would be higher then the current 30 stocks. In part due to T. Link

Jeff Bailey : 9/29/2006 3:20:54 PM

03:00 Internals found at this Link

Jim Brown : 9/29/2006 3:22:27 PM

Dow Leveraged Short Funds - Double returns on any Dow decline.

DOG - Dow 30 Short Proshares
DXD - Dow UltraShort Proshares
RYCWX - Rydex Inverse Dow 30

Dow Leveraged Long Funds - Double returns on any Dow gain:

DDM - Ultra Dow Proshares
RYCVX - Rydex Dynamic Dow

Jeff Bailey : 9/29/2006 3:16:08 PM

03:00 Market Watch found at this Link

Tab Gilles : 9/29/2006 3:17:00 PM

Eaton Vance Limited Duration Fund (EVV)

I've been tracking this stock since last year.

Tab Gilles : 8/4/2006 2:41:20 PM

Eaton Vance Limited Duration Fund (EVV) It's been several months since I've commented on EVV. Back in November I noted that the candle formation appeared to be making a bottom (Post 11/28/05 11:29AM). Then on 1/11/06 (posted12:33PM) I commented that it was heading for $17.75.

Currently trading at $17.95, intraday high $18. It appears to want to head higher. If you're in the EVV, use a trailing stop, either 21-ma or 50-ma.

Today, it has broken below it's 50-ma...for those who have it in their portfolio, [currently not in my MM Open Position], I would take some profits here. Link Link Link

Jim Brown : 9/29/2006 3:14:10 PM

Option Trader Alert
Don't forget those cheap DJX puts I suggested yeaterday. The Oct $117 Puts DJW-VM currently $1.15.

Jane Fox : 9/29/2006 3:10:13 PM

YM and ER are now making new daily lows.

Jim Brown : 9/29/2006 3:09:34 PM

Once sellers start thinking the funds are done we could see a strong dive into the close. The internals are worsening and the A/D has gone negative. We may be approaching that point of no return for the tape painters. At some point they will have to throw in the Dow record towel as a lost cause.

Jim Brown : 9/29/2006 3:06:17 PM

I think everyone is waiting to see if the tape painters are going to take one more run at a new Dow high in the last 30 min of trading. Everybody knows the path of least resistance is down given the extremely overbought markets. They are just afraid to jump in front of an end of day buy program targeting a new Dow high to produce weekend headlines for the newspapers. Despite the small sell program we just saw we are still at risk of a big buy program taking us right back to the highs on the Dow for that all important close.

Jane Fox : 9/29/2006 3:06:14 PM

ES makes a triple bottom at 1346. VIX not helpful today at all. Usually if you see a triple bottom like this and the VIX did not retest it daily highs at the same time those lows would hold but there is something really strange about the VIX today considering it is not an OPEX week.

Jeff Bailey : 9/29/2006 3:04:58 PM

Any of you old YM futures traders keeping and eye on AIG $66.16 -0.12% from May 10 al_rt?

Jane Fox : 9/29/2006 3:02:11 PM

Do you feel like the sellers are just waiting around the corner?

Jim Brown : 9/29/2006 3:01:28 PM

I am still holding my ER short from yesterday. Several times we came close to 740 and I was worried the tape painting would push us higher but the chart of the ER for the last two days that 740 resistance level has been respected. I am expecting a futures dump after the close as funds try to protect their longs against window undressing next week.

Jane Fox : 9/29/2006 2:57:30 PM

ER's daily lows from this morning were 736.10 and they have now been retested.

Jeff Bailey : 9/29/2006 2:58:28 PM

Bullish swing trade call close out alert

Let's close out the ishares Russell 2000 IWM Jan $71 Call (DIW-AS) at the bid of $4.70 ($4.70 x $4.80) with IWM $72.55.

Jane Fox : 9/29/2006 2:55:52 PM

Whoa just saw a great big red bar on my ER chart.

Jeff Bailey : 9/29/2006 2:53:28 PM

IWM and now a 60-minute chart interval with WEEKLY/MONTHLY Pivot retracement at this Link

Norman! Are you following some of this? I've also tried to teach traders the use and importance of retracement with Pivot Levels.

Yes, at first everything looks "cluttered," but when you work from the "BIG PICTURE" first (maybe conventional, then MONTHLY) you pick out your "key levels" that may overlap. Then throw on the WEEKLY. Anything duplicate, or overlap? Then a DAILY if you want.

Even though I wasn't going to be here from 09/01/06 to 09/08/06, the way the IWM had been trading in its pivots, suggest to be that IWM was a "buy" at/near the $70.00 level and MONTHLY Pivot/WEEKLY S1.

Now see how much "overlap" resistance IWM faces at $74.00?

Keene Little : 9/29/2006 2:48:30 PM

Trying to think about how big money might try to play this game is usually an exercise in frustration. When I see today's consolidation I think we're headed higher. When I think about the number of people who are thinking of shorting this market, with the expectation that we'll see a reversal next week, I wonder how Big Money will play with that idea and spike them all out with a few big buy programs on Monday. But maybe we really are running out of steam and this will simply collapse from its own weight up here without much more buying support, or shorts, to drive it higher

The buying pattern this week has made for a strange looking rally, from an EW perspective, but if I squint I can make out the pattern for a 5-wave advance that calls for a little higher to finish the 5th wave. If the 5th wave achieves equality with the 1st wave we get ES 1352 for a target. If it goes to 162% then we get 1357.50. SPX 1345-1347 is a Fib/Gann target area by a larger pattern so this all ties together as a possibility. Link

So maybe a quick rally on Monday (or this afternoon) to stop out the shorts and then downhill from there. Unless the Boyz want to play with the bears to get them to scream uncle (and have a rally to sell into), we should be close to a high. Otherwise we could see a blow-off top that convinces everyone the market is going to rally to the moon. I'm working on what the Fib relationship would be for a run to the moon and I'll get back to you on that.

Jeff Bailey : 9/29/2006 2:31:20 PM

Hey ... looky there ... USO $57.10 +0.79% .... and DAILY Pivot.

Jeff Bailey : 9/29/2006 2:28:35 PM

IWM we do have another "option" while we wait to see what happens.

What if we sell covered the IWM Oct. $74 Calls (IOW-JV) for $0.85?

or the $75 Calls (IOW-JW) for $0.50.

Might NOT make sense for 1 contract, but traders with an account larger than the hypothetical $10,000 account I use here in the MM might see it as something that "makes sense"

Jane Fox : 9/29/2006 2:23:08 PM

McMillan's weekly commentary - A short-term correction is overdue, but the intermediate trend remains positive. That comment is unchanged from our last report, only the levels of $SPX and the indicators have changed. $SPX broke out over 1327 this week, moving to 5-1/2 year highs. This is the index that most serious traders follow, so it is somewhat irrelevant if the Dow trades at an all-time high or not. The 1325-1327 level should now provide support for $SPX, with further support at 1290 below there. As long as $SPX holds above 1327, the bears really have no case. We consider the $SPX price chart to be an intermediate-term indicator.

The equity-only put-call ratios remain on buy signals. The weighted ratio finally broke down below last summer's lows, which is bullish. The standard ratio is slowly declining, but still hasn't fallen below the July lows. These are intermediate-term bullish. From a broader perspective, these ratios are quite high on their charts and while we don't use absolute levels for determining buy and sell signals, it does indicate that the level of put trading remains extremely high. Perhaps it's just put hedging that's going on, but day after day it keeps these ratios near the top of their charts.

Market breadth has been "okay," not great. When the market declined for a couple of days last week, breadth gave sell signals, but those were quickly reversed during this week's rally. At the present time, breadth is overbought once again.

Finally, the volatility indices ($VIX and $VXO) have remained at very low levels. This is also an indication of an "overbought" market. But "overbought" does not mean "sell," and so the market can continue to advance on the basis of the bullish intermediate-term indicators, with the understanding that the overbought condition subjects the market to potentially sharp, but probably short-lived corrections.

Jeff Bailey : 9/29/2006 2:21:14 PM

iShares Russell 2000 (AMEX:IWM) daily interval bar chart with a high/low close retracement at this Link

Do you "see" where my NYSE Summation observation and current trend that's in play and the 61.8% ($73.44) retracement bring some caution?

We've taken 1 profit on this trade (Thailand news) and we could easily take another. Wait and see if these resistance levels are broken, then get back on board. Even look to buy back on a dip to $70.84, unless we decide mid-caps, or large-caps provide to more secure "pullback buy" to another new high, where supply would be limited!

Jeff Bailey : 9/29/2006 2:13:41 PM

In your mind ... try "meshing" the NYSE and NASDAQ summation's together. 2000 stocks in the IWM. Say 50/50 NYSE/NASDAQ (I do not know for certain that 1000 stocks are NASDAQ and 1000 are NYSE, but I know it is blended)

Jeff Bailey : 9/29/2006 2:08:07 PM

NASDAQ Summation Index ($NASI) PnF 20-point box size Link

Jeff Bailey : 9/29/2006 2:03:31 PM

NYSE Summation Index ($NYSI) PnF chart 20-point box size that I am and suggest others monitor and understand at this Link

In a second, I'm going to show the iShares Russell 2000 (IWM) and from a perspective of near-term risk/reward (will it make the move? NYSI and IWM) suggest we take another profit in the IWM calls and move to the sidelines.

Earlier this week I said "bulls want to start seeing breadth broaden out" and the NYSI 20-point chart provides a BIG test for those thoughts.

Marc Eckelberry : 9/29/2006 1:53:06 PM

Hanging Man for the COMP if it closes here. For those not familiar with candlesticks, here is the write-up from Stockcharts:

The Hanging Man is a bearish reversal pattern that can also mark a top or resistance level. Forming after an advance, a Hanging Man signals that selling pressure is starting to increase. The low of the long lower shadow confirms that sellers pushed prices lower during the session. Even though the bulls regained their footing and drove prices higher by the finish, the appearance of selling pressure raises the yellow flag. As with the Hammer, a Hanging Man requires bearish confirmation before action. Such confirmation can come as a gap down or long black candlestick on heavy volume. Link

Marc Eckelberry : 9/29/2006 1:48:50 PM

Next month, the elections will take priority along wth the economy. It could get interesting.

Marc Eckelberry : 9/29/2006 1:47:52 PM

WASHINGTON (Reuters) - The U.S. Congress on Friday moved to block the Bush administration from building permanent U.S. military bases in Iraq or controlling the country's oil sector, as it approved $70 billion for funding the wars in Iraq and Afghanistan. The restrictions included in a record $447 billion military funding bill were a slap at the administration, and Republicans have stripped them out of legislation in the past. Democrats and many Republicans say the Iraqi insurgency has been fueled by perceptions that the United States has ambitions for a permanent presence in the country. They have called on Bush to make a policy statement that the United States has no such plans.

Marc Eckelberry : 9/29/2006 1:45:47 PM

Nice turnaround for December gold, now back above 20 dma. Same with QM. Equities have been a waste of time this week compared to the money made in QM and YG.

Jane Fox : 9/29/2006 1:41:14 PM

* NYSE VOLUME 775.9M
* NYSE HAS 1,614 ADVANCERS
* NYSE HAS 1,522 DECLINERS
* NYSE HAS 170 ISSUES UNCHANGED
* NYSE HAS 78 ISSUES SETTING 52-WEEK HIGHS
* NYSE HAS 10 ISSUES SETTING 52-WEEK LOWS
* NASDAQ VOLUME 1.09B
* NASDAQ HAS 1,494 GAINERS
* NASDAQ HAS 1,434 LOSERS
* NASDAQ HAS 164 ISSUES UNCHANGED
* NASDAQ HAS 73 ISSUES SETTING 52-WEEK HIGHS
* NASDAQ HAS 36 ISSUES SETTING 52-WEEK LOWS

Jeff Bailey : 9/29/2006 1:38:29 PM

I'm wondering what "piece of news" it is going to take to get that record level of M2 money supply to come into the markets.

M1 and M2 Link

Marc Eckelberry : 9/29/2006 1:24:04 PM

ES weekly R2 is 1348 and NQ weekly R2 is 1693. Who said techs were leading this rally? Not per-pivots and SOX.

Jeff Bailey : 9/29/2006 1:21:25 PM

01:00 Internals found at this Link

Jeff Bailey : 9/29/2006 1:20:27 PM

01:00 Market Watch found at this Link

Keene Little : 9/29/2006 1:14:38 PM

Will the last trader to leave today please turn out the lights. Hello? Anyone there? Looks like everyone has already left the building. Well, it should be easy to ramp the market into the close to get that all important all-time closing high.

Jane Fox : 9/29/2006 1:10:39 PM

Natural gas emerges as biggest commodity loser in Q3

Jane Fox : 9/29/2006 1:10:16 PM

When you see the internals so totally messed up you wonder if there is something afoot.

Jane Fox : 9/29/2006 1:08:53 PM

Even my tried and true VIX is totally useless today. Link

Jane Fox : 9/29/2006 1:07:57 PM

It has been a long time since I have seen these two quite this unreadable - or maybe they are just very very neutral and have absolutely no bias. Link

Jeff Bailey : 9/29/2006 1:03:53 PM

01:00 Internals found at this Link

Keene Little : 9/29/2006 12:46:05 PM

Thanks Marc (re: Wrap).

Jeff Bailey : 9/29/2006 12:45:58 PM

U.S. Oil Fund (USO) 10-minute interval chart ... now with DAILY Pivot Levels at this Link

Tab Gilles : 9/29/2006 12:37:33 PM

Alkermes (ALKS)$15.60 +$0.53 (+3.52%)

ALKS is a recent addition to my MM Watch List.

Alkermes number cut at Morgan Stanley: Morgan Stanley is cutting 2008 EPS estimates on Alkermes and lowering its price target on the company from $24 to $21. Maintain overweight rating. Link Link

I would like to see it break out of that down trend channel, stay above it's 50-ma and weekly 10-ema.

Marc Eckelberry : 9/29/2006 12:34:29 PM

I would add inflation and dollar weakness to the actual price of the DOW. Recapturing the highs of 2000 is not enough for DOW 11750. In real dollar terms, we would probably have to be a 1000 points higher. Not to mention SPX and of course the COMP.

Marc Eckelberry : 9/29/2006 12:32:21 PM

Keene, your wrap last night was tops.

Marc Eckelberry : 9/29/2006 12:19:29 PM

It could just be a flat day after all this noise.

Jeff Bailey : 9/29/2006 12:25:00 PM

U.S. Oil Fund (USO) 60-minute interval chart (see 11:59:45) and period from early August, to mid-September at this Link

One IMPORTANT way to view Pivot Levels is to observe HOW the security has been traded when you decide to place a trade yourself. It is important for a trader/investor to have an understanding of how INVENTORY is managed with COMPUTERS.

In simplistic form, if a LEVEL of RESISTANCE is trade and buyers take inventory AWAY from the specialist/market maker, then the specialist/market maker "should" be a buyer at the next level lower in order to replenish the inventory he/she sold at the higher level.

However, when lower levels continue to find sellers, then the market maker/specialist needs to get more defensive, and he/she begins to sell a level higher.

Yesterday's trade at WEEKLY R1 does suggest some DEMAND returning, but after weeks of distribution lower, it would "make sense" that oil find selling there. Now we want to see if a "shift" is really taking place, and look for BUYERS at WEEKLY Pivot.

RETRACEMENT brackets, or MONTHLY Pivot Levels are utilized to give "bigger picture" of where we might look for support/resistance. DAILY Pivot Levels will be used by day traders.

Look for OVERLAP, or levels that show up from your/my analysis. If you have 2, or 3 "levels" show up, then that become a focus point for support/resistance.

Marc Eckelberry : 9/29/2006 12:13:30 PM

I don't think bulls will pull it off today. The AD line is back to -132 and YM keeps getting sold at 11800.

Marc Eckelberry : 9/29/2006 12:11:38 PM

My wife just bough a Mac Book Pro. What a stunning laptop. Why can't PC companies make a product that is appealing? It just blows the mind that Apple is the only company making decent looking computers, Ok, maybe Sony, but they are not cheap. Who designs those horrible Dells? If I could run QCharts on a Mac, I would trash my PC. The screen on her laptop is gorgeous, it's fast, and they pay attention to details like a lit keys in the dark. No wonder that stock is flying.

Marc Eckelberry : 9/29/2006 12:05:43 PM

Marc, Where do you get the SOX quote from? My broker no longer provides it and I have looked at other sources with no luck. Thanks, Wes

IB and and Quote tracker, a free program I highly recommend when QCharts is down. I am waiting for Qcharts to get back on line with the SOX, as I use them. In the meantime, you can also check SMH which has been very reliable as to patterns.

Marc Eckelberry : 9/29/2006 12:00:39 PM

QM bid. If oil gets back above 62, it will be tough to play new all time highs today.

Jeff Bailey : 9/29/2006 11:59:45 AM

U.S. Oil Fund (USO) $55.97 -1.20% ... 60-minute interval chart at this Link

This is the same "retracement chart" I put together on Wednesday, but I'm adding the WEEKLY Pivot Levels from QCharts.

In a minute, I will show you WHY, and perhaps HOW a trader will utilize PAST OBSERVATIONS in order to have a PLAN on what to do in the FUTURE.

IMPORTANT OBSERVATION is the period between 08/07/06 and 08/09/06 and days following. Will HISTORY repeat? Or diverge? Bulls want DIVERGENCE!

Marc Eckelberry : 9/29/2006 11:58:26 AM

I would put the NQ resistance above 1683 at 1692/1693.

Marc Eckelberry : 9/29/2006 11:57:21 AM

If we get a push, QQQQ 41.03 is resistance.

Keene Little : 9/29/2006 11:53:25 AM

While equities may not get far today, and therefore I see no recommended trade setups, I would say a safe bet is that we will not see a sell off today. It's too important for the big funds to see a positive press this weekend about what a great bull market we have. It's the only way to bring in the sheeple (thanks Joe for that term--it's perfect) to do the buying as the smart money unloads their inventory. So a close at a new all-time high for the DOW is a given as far as I'm concerned.

Jane Fox : 9/29/2006 11:51:46 AM

* NYSE VOLUME 518.5M
* NYSE HAS 1,357 ADVANCERS
* NYSE HAS 1,648 DECLINERS
* NYSE HAS 185 ISSUES UNCHANGED
* NYSE HAS 68 ISSUES SETTING 52-WEEK HIGHS
* NYSE HAS 11 ISSUES SETTING 52-WEEK LOWS
* NASDAQ VOLUME 723.9M
* NASDAQ HAS 1,304 GAINERS
* NASDAQ HAS 1,528 LOSERS
* NASDAQ HAS 151 ISSUES UNCHANGED
* NASDAQ HAS 71 ISSUES SETTING 52-WEEK HIGHS
* NASDAQ HAS 41 ISSUES SETTING 52-WEEK LOWS

Marc Eckelberry : 9/29/2006 11:45:37 AM

Here they come.

Marc Eckelberry : 9/29/2006 11:40:51 AM

Someone keeps chasing the dollar, I guess that is all part of the overall belief that the US economy will get a soft landing. I would not be so sure. I wonder if Buffet is still short the greenback.

Marc Eckelberry : 9/29/2006 11:39:07 AM

Gold found support right above 38.2% current rally and as long as that holds (598.80), it should just be a pullback on an otherwise healthy rally. The key would be to close back above 20 dma at 603.80. Dollar is still up and oil is down, so gold is getting a one two punch, but holding up remarkably well. On a more macro level, with inflation creeping up and consumer spending weakening, I think gold is very, very attractive.

Marc Eckelberry : 9/29/2006 11:35:07 AM

Jane is right. Commodities have been cleaner trades this week. This is a mess.

Marc Eckelberry : 9/29/2006 11:27:03 AM

Dollar is weakening.

Jeff Bailey : 9/29/2006 11:27:18 AM

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

Jeff Bailey : 9/29/2006 11:22:05 AM

11:00 Internals found at this Link

Marc Eckelberry : 9/29/2006 11:14:52 AM

E weekly R2 is resistance.

Marc Eckelberry : 9/29/2006 11:14:29 AM

Internals are weak, but that can change.

Marc Eckelberry : 9/29/2006 11:14:11 AM

ES triangle 5 mn. Could mean a push up.

Jane Fox : 9/29/2006 11:12:24 AM

So days (weeks) like this I will not trade - at least not trade the indexes. I have been trading the commodities mostly this week.

Jane Fox : 9/29/2006 11:10:44 AM

Even if the internals are not in clear they will usually give me hint as to bullishness or bearishness but this week they have been so out of sync that I cannot even decipher a hint.

Jeff Bailey : 9/29/2006 11:04:51 AM

11:00 Market Watch found at this Link

Jim Brown : 9/29/2006 11:01:56 AM

RIMM is holding up the Nasdaq and that support was slowing the Dow and S&P decline by default.

Jane Fox : 9/29/2006 11:00:35 AM

On the other hand Nat Gas is in rally mode so I don't think Oil will continue its downward trek.

Jane Fox : 9/29/2006 10:59:12 AM

Oil is making new daily lows as well - of course since Gold and Oil seem to be joined at the hip lately.

Jane Fox : 9/29/2006 10:58:05 AM

Gold is losing it here but still within what I would call a pullback from resistance.

Jeff Bailey : 9/29/2006 10:59:12 AM

Take profits on RIMM if you're long. I looked at the stock earlier this week, but decided against a long as it was so close to its bullish vertical count.

Jeff Bailey : 9/29/2006 10:57:37 AM

Research in Motion (RIMM) $102.96 +19.57% Link ... surge on Q2 results and outlook.

AP Story Link

Marc Eckelberry : 9/29/2006 10:57:27 AM

All cash is red and futures stay green.

Marc Eckelberry : 9/29/2006 10:55:05 AM

In any case, it doesn't matter. YM futures front month traded contract decided today that 11808 ws high enough. So far.

Marc Eckelberry : 9/29/2006 10:53:43 AM

Sorry, I do have to correct, it was a 150 point premium.

Marc Eckelberry : 9/29/2006 10:53:13 AM

I don;t think we can say that any all time highs were hit in May.

Marc Eckelberry : 9/29/2006 10:54:02 AM

Jane, we can agree that the December contract back in May hit 11880, but we can also agree that no one was trading it and it had an almost 150 point premium. Thus the traded contract is the one with volume and is usually the front month contract. So when the entire world was trading YM futures in May, it was the June contract which was 150 points lower than the thinly traded December. That makes today an all time high.

Keene Little : 9/29/2006 10:49:19 AM

The time premium and trading hours makes a difference between the cash indices and their futures. That's why all my analysis is done on the cash indices. I'll do it on the futures as well, but always confirmed with cash.

Marc Eckelberry : 9/29/2006 10:47:46 AM

I don't use continuous on futures, I find it to be unreliable, since basically there is no volume on contracts older than 3 months and the time premium is pretty large. I go to cash underlying for longer term charts.

Keene Little : 9/29/2006 10:46:16 AM

So far, assuming we're going to get a little further pullback, it's looking corrective. If it continues this way then I'm going to make the assumption that we'll see a rally leg out of this week's consolidation once the pullback is finished. It should be a good scalp long play. A rally early next week would catch a lot of bears betting on a downside correction to this week's propping. It could be propped a little longer to make sure there's a run on the shorts.

Jane Fox : 9/29/2006 10:45:23 AM

I respectively disagree but that is what makes the world go 'round.

Marc Eckelberry : 9/29/2006 10:45:00 AM

I just checked, it was the December contract with an 8 month premium. So we did hit all time highs for a front month contract in YM today.

Marc Eckelberry : 9/29/2006 10:42:20 AM

If that was the current December contract trading back then above 11800, it doesn't count.

Jane Fox : 9/29/2006 10:42:06 AM

Marc I use the continuous contract so it has been adjusted for the front.

Marc Eckelberry : 9/29/2006 10:41:32 AM

Qcharts does not give me continuous YM, but I don't recall the front month (traded) above 11800.

Marc Eckelberry : 9/29/2006 10:40:06 AM

Was that the front contract, Jane?

Marc Eckelberry : 9/29/2006 10:38:56 AM

Just can't get a sub pivot fday for ES. Maybe today is the day. It's due.

Jane Fox : 9/29/2006 10:32:09 AM

Marc I see a YM high back in May of this year at 11872 so I don't think today was an all time high.

Jane Fox : 9/29/2006 10:30:20 AM

Dow's all time high of 11749 was made back in January 2000. Today's high so far has been 11741.

Jane Fox : 9/29/2006 10:27:47 AM

The VIX and TRIN are just as muddled as these two. Link

Marc Eckelberry : 9/29/2006 10:26:24 AM

Now RLX is down. Only financials are holding up. Market breadth has turned downright suspicious. The question is: what is smart money doing? I think they are on the sidelines for now. The TRAN is not confirming the DOW new highs. Where is Russell? Is he too afraid to speak out?

Marc Eckelberry : 9/29/2006 10:19:55 AM

Watch YM 11800

Jane Fox : 9/29/2006 10:12:50 AM

Tab you certainly got our attention with your 10:08 post. That is hilarious but what a good idea.

Marc Eckelberry : 9/29/2006 10:11:57 AM

I guess YM all time high at 11808 got some selling going.

Marc Eckelberry : 9/29/2006 10:09:01 AM

TRAN is down, SOX is down, GSO is down.

Tab Gilles : 9/29/2006 10:08:58 AM

Prostitutes, smugglers a boost Greek economy Link

Marc Eckelberry : 9/29/2006 10:07:54 AM

A push to get 11750 shoul succeed but it is with weak breadth. ES 1354/1356 is resistance if we break out, Watch COMP 2272 and 2283.

Keene Little : 9/29/2006 10:06:55 AM

This ES 30-min chart shows the bullish possibility with this week's consolidation. A dip to the low of the range (1343) would complete the consolidation and then it could be rally ho from there. Obviously a break of this range to the downside would be more immediately bearish. Link

But if ES continues higher from here then I'll be watching to see how it progresses since it's possible that it will be the last leg up in the rally from Sept 22nd (and shouldn't get too far). SPX 1345/ES 1355 still makes for a good target area.

Jeff Bailey : 9/29/2006 10:04:54 AM

10:00 Market Watch found at this Link

Jane Fox : 9/29/2006 10:03:10 AM

* POOLE: DELAY IN FIGHTING INFLATION WILL CAUSE TROUBLE
* POOLE: FED WILL EASE IF DOWNTURN SHARP AND INFLATION WEAKENS
* POOLE: FED WILL HIKE IF GROWTH, INFLATION ABOVE FORECASTS
* POOLE WANTS POLICY ONLY AS TOUGH AS NECESSARY ON INFLATION
* POOLE SAYS FED CAN EASE AGGRESSIVELY IF ECONOMY SLOWS
* POOLE: WILL NOT BE QUICK TO EASE ON FIRST SIGN OF SLOWDOWN
* FED'S POOLE SAYS ACCEPTING CURRENT INFLATION RATE A MISTAKE

Jane Fox : 9/29/2006 10:02:20 AM

* UMICH SEPT. SENTIMENT ABOVE 82.0 IN AUG.
* UMICH SEPT. SENTIMENT CLOSE TO 85.3 FORECAST
* UMICH SEPT. SENTIMENT REVISED UP TO 85.4 VS 84.4

Jane Fox : 9/29/2006 10:01:50 AM

SEPT. CHICAGO PMI 62.1% VS. 55.7% EXPECTED

Jane Fox : 9/29/2006 9:55:40 AM

PMI in 5 minutes.

Marc Eckelberry : 9/29/2006 9:48:22 AM

SOX down, VIX/VXN up. ADDEC lines drop. Hmm. Could we have seen the top today?

Marc Eckelberry : 9/29/2006 9:45:28 AM

Internals are weakening, but it could be a headfake. ES key support is 1347.

Jane Fox : 9/29/2006 9:45:05 AM

Both VIX and TRIN open with their respective PDRs.

Jane Fox : 9/29/2006 9:42:09 AM

Remember Michagan Consumber Sentiment in 5 minutes.

Jane Fox : 9/29/2006 9:41:20 AM

AD line is a bullish +504 and AD volume climbing. The bulls have the ball.

Marc Eckelberry : 9/29/2006 9:37:15 AM

SOX is down.

Keene Little : 9/29/2006 9:25:47 AM

The question in my mind as I look at YM is whether it's bullishly consolidating at the top of its ascending wedge or if it's bearish: Link

If we were to get a pullback that stayed within this week's trading range and then a break out to the north that would be bullish. If we climb from here and continue to leave bearish divergences then it shouldn't get far and it will be bearish. I'm waiting for price to tell me which it will be.

Marc Eckelberry : 9/29/2006 9:26:59 AM

QM hit key support at 62.10 (62.10 is 5 dma and 62.025 is 10 dma).

Marc Eckelberry : 9/29/2006 9:23:15 AM

Traders are obsessed with DOW 11750, so much so that they are ignoring a very dangerous creep up in inflation and a lowering of conusmer spending. The word stagflation will appear in the press next week, after we get back to more normal patterns.

Jane Fox : 9/29/2006 9:21:10 AM

BAsed on MACD and RSI daily charts, ER is the least bullish so if you believe this market is topping and ready for a pullback this is the market you should short or buy IWM puts.

Jane Fox : 9/29/2006 9:15:40 AM

I am short Oil with a stop just above overnight highs. I will take my profits when I get them today and not wait.

Jane Fox : 9/29/2006 9:14:44 AM

Gold has hit some major resistance and it is not surprising it is retracing. Now the trick is to determine if this retracement is a pullback from resistance or something more bearish. I see no bearish divergence in the MACD nor the RSI telling me it may just be a simple pullback.

Here is a 240 minute chart of Gold with a fib retracement anchored from resistance to September lows. Gold could pullback all the way to the 50% retracement at 596, which would be a nice little handle to the cup that has already formed, but much further than that and the goldbugs start to worry. Link

Jane Fox : 9/29/2006 9:02:59 AM

All the commodities I watch, Natural Gas, Oil and Gold, broke their PDLs overnight. Yesterday I thought a long in Nat Gas would be a good idea because I saw Oil consolidating at daily highs and Nat GAs and Oil trade in unison mostly. I took a long in Oil but watched Natural Gas on the monitor. That Nat Gas long stopped at a loss, although my long in Oil was doing OK. I should have thought gee if Natural Gas is not bullish today then probably Oil will not be either. I had a very nice profit in my oil trade and had raised my stop to breakeven; I went to make some breakfast and when I came back my trade was stopped. Link

Jane Fox : 9/29/2006 8:50:59 AM

WASHINGTON (MarketWatch) -- U.S. core consumer price inflation hit an 11-year high in August as household incomes and spending rose at the slowest pace this year, the Commerce Department reported Friday.

Jane Fox : 9/29/2006 8:49:12 AM

Reports that the Core Consumer Inflation saw its fastest pace in 11 years didn't seem to affect the markets. They all dipped a tad but have now recovered. YM and ES are now making new daily highs and YM has even broken its PDH. Link

Jane Fox : 9/29/2006 8:43:17 AM

Dateline WSJ - A gauge for core price inflation crept higher during August, while the growth of consumer spending and income slowed.

In its monthly report on what Americans earn and spend, the Commerce Department on Friday said personal income increased at a seasonally adjusted monthly rate of 0.3%, after climbing an unrevised 0.5% in July.

Personal consumption inched up 0.1%, the weakest climb since November 2005. July spending rose an unrevised 0.8%. Spending adjusted for inflation dipped 0.1% in August, the largest decrease since 0.3% in September 2005.

The median estimates of 26 economists surveyed by Dow Jones Newswires were a 0.3% increase in personal income in August and 0.2% growth in consumer spending.

A price index for personal consumption expenditures excluding food and energy increased by 0.2% in August compared with a month earlier; it rose 0.1% in July.

Compared with a year earlier, this core PCE price index grew 2.5% in August, after increasing by 2.3% in July. The Federal Reserve watches the year-over-year index for signs of excessive inflation; the central bank's so-called comfort zone for this gauge is considered to be 1.0% to 2.0%. The market-based core PCE price index grew 2.1% in August compared with a year earlier after rising 2.0% in July.

After-tax income, also known as disposable personal income, increased 0.4% in August, following a 0.6% advance in July.

Spending on durable goods -- designed to last three years or longer -- fell by 1.3% in August, after a 1.8% advance in July. Non-durable goods spending rose 0.2% in August after a 0.9% increase the previous month. August spending on services advanced 0.4%, after a 0.6% climb in July.

Personal saving as a percentage of disposable personal income was negative 0.5% in August -- the 17th month in a row the rate has been in negative territory.

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