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Jeff Bailey : 10/4/2006 2:58:43 AM

Oil Futures: Prices Down, Market Braces For Products Stockbuild

DJ- Benchmark U.S. oil futures lost further ground Wednesday as sentiment stayed under short-term pressure ahead of the release of weekly oil data from the Department of Energy.

Despite what oil bulls have said about a potentially tighter supply-demand balance in the longer term, the selloff has persisted on expectations of more builds in U.S. oil product inventories.

"We continue to see oil prices as having overshot to the downside from a fundamental perspective but acknowledge that in the short term at least, there is risk of further moves to the downside," said Mike Fitzpatrick, a vice-president for energy risk management at Fimat USA.

At the New York Mercantile Exchange, light sweet crude oil for November delivery traded at $58.32 a barrel at 0645 GMT, down 36 cents in the Access electronic session.

The heating oil contract for November fell 99 points to 164.40 cents a gallon, while November gasoline was down 17 points at 145.50 cents/gallon.

Nymex crude lost nearly 3.9% of its value Tuesday, extending Monday's 3% drop, on a pullback partially triggered by technical factors.

With prices failing to hold support at the psychologically important $60 level, the market may now target the mid-February low of $57.55.

"Clearly, there is...reluctance to push prices past the $60 mark. Unless something of considerable fundamental import arises, we think these parameters will hold, in the short run anyway," Fitzpatrick said in his daily note to clients.

Expectations, meanwhile, are for the U.S. products stock buffer to stay comfortable at a period of slowing demand growth.

The country's distillate inventories are expected to have built by 1.3 million bbl in the week to Sept. 29, while gasoline stocks likely rose 1.2 million bbl, a Dow Jones Newswires survey of 10 analysts showed.

Distillates comprised heating oil - closely watched in the lead-up to winter - and diesel.

These gains are anticipated despite a possible half-a-percentage-point drop in refinery operating rates, suggesting imports may have stayed high.

Commercial crude inventories probably fell by a modest 700,000 bbl, according to the survey.

The DOE's statistics unit, the Energy Information Administration, will put out its Weekly Petroleum Status Report at 1430 GMT.

Ahead of the data release, oil prices at London's ICE Futures exchange also traded downward.

November Brent crude fell 41 cents to $58.02/bbl, while October gasoil changed hands at $521 a metric ton, $4 off Tuesday's settlement.

Jeff Bailey : 10/4/2006 2:33:00 AM

BP See 3Q Production At 3.8M BOE/D

DJ- BP Wednesday said that overall production in 3Q'06 is expected to be around 3.8 million barrels of oil equivalent per day.

Excluding volumes from TNK-BP operations, production in 3Q'06 is expected to be around 2.85 million barrels of oil equivalent per day, versus 3.019 million barrels of oil equivalent per day in 2Q'06. This reduction reflects the impact of divestments, maintenance and operational downtime. BP's net share of production from TNK-BP is expected to be approximately 0.950 million barrels of oil equivalent per day, versus 0.999 million barrels of oil equivalent per day in 2Q'06, with the reduction reflecting divestments.

BP said that the third quarter's Global Indicator Margin (GIM) was lower than in 2Q'06. Stronger overall marketing margins are expected to be more than offset by lower supply optimisation results.

The company said that margins in its Gas, Power and Renewables business for the quarter are expected to be lower than 2Q'06 largely due to significantly weaker gas and power trading margins in North America.

The company also said that the charge in Other Businesses and Corporate is expected to be in line with the guidance given in the February 2006 Strategy Presentation for an annual charge of $900 million +/- $200 million.

Aggregate non-operating items in 3Q'06 are expected to amount to a pre-tax gain of around $2bn, primarily reflecting gains on upstream asset disposals.

The total consolidated interest charge is expected to be around $100 million.

The effective tax rate for the quarter is expected to be around 40%, reflecting the enactment of the increase in the U.K. North Sea tax rate, partly offset by lower quarter end price effects.

Gearing for the quarter is expected to be similar to the 2Q'06 level of 15%.

The company said that during the quarter it bought back 299 million shares for a total consideration of $3.5bn. Shares outstanding at Sep. 28, 2006, excluding treasury shares, were 19,863 million. As in previous quarters, BP has entered into an arrangement that allows the share buy back programme to be continued during the closed period which commenced at close of business in London on Sep. 30.

Marc Eckelberry : 10/4/2006 1:49:48 AM

North Korea will come on the radar tomorrow.

Keene Little : 10/4/2006 12:40:10 AM

The COMP bounced off support Tuesday morning at its August uptrend line (currently just under 2232) and met resistance at its previously broken uptrend line from Sept 11th (currently just under 2257). Like the SPX, play the direction of the break. Link

Jeff Bailey : 10/4/2006 12:36:36 AM

Japan Oil Data: Gasoline Stocks Up 157,901KL On Week

DJ- Gasoline stocks held by Japanese refiners as of Sept. 30 rose by 157,901 kiloliters to 2.17 million KLfrom the previous week, the Petroleum Association of Japan said Wednesday.

Crude stocks held by the Japanese refiners increased by 601,256 KL on week to 17.73 million KL, or 111.54 million barrels, while kerosene stocks held by refiners rose by 144,654 KL on week to 5.15 million KL, PAJ said.

Refinery operating rates in the week to Sept. 30 averaged 77.9% of capacity, compared with 82.2% in the previous week. In line with the lower operating rate, crude processed in the week was down 225,781 KL to 4.15 million KL, or 3.73 million barrels a day, according to PAJ.

Keene Little : 10/4/2006 12:06:35 AM

The DOW made a new high on Tuesday but as discussed at length during the day there was a distinct lack of market breadth to support the phony high. If the rally continues, and gets the support from the other indices then we'll get something a little more bonafide than what we've seen so far. But if the DOW turns back down now it will leave one heck of a short term bearish divergence at that high, and this after coming within a few points of a potential Fib projection at 11764. Link

The bulls will need to keep this rallying tomorrow otherwise the charts spell trouble for this rally. A close up view of the 240-min SPX chart that I showed earlier on Tuesday shows the bounce off support at the May high (just under 1327) and then a pullback from resistance at the top of its ascending wedge (1338). That's our support and resistance lines that should give us some clues as to the next direction--play the break. Link

Jeff Bailey : 10/4/2006 12:03:45 AM

52 Week High/Low by Sector at this Link

09/20/06 measures at this Link

Jeff Bailey : 10/3/2006 11:02:25 PM

December Crude Oil (cl06z) bar chart at this Link ... for those trading QM, or cl November, or USO where historical trade nonexistent, or sketchy.

Keene Little : 10/3/2006 10:43:12 PM

Wednesday's pivot tables: Link and Link

OI Technical Staff : 10/3/2006 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 : 10/3/2006 6:53:03 PM

NASDAQ Summation (NASI) 10-point box chart Link would show 3-box reversal today from +30 to 0.00. First sign of a/d softening since "buy signal" in early August at -590.

20-point box chart Link

Update to 09/29/06 02:03:31.

Jeff Bailey : 10/3/2006 6:01:29 PM

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

Today's Activity

Swing trade bullish stopped on the 1/2 position in the U.S. Oil Fund (USO) at $54.50. ($-1.51, or -2.70%)

Bearish swing trade sold naked two (2) of the Baker Hughes BHI Oct. $70 Calls (BHI-JN) at the bid of $0.60. Stop is $70.25 in the underlying.

Bearish swing traded long two (2) of the Companhia Vale do Rio Doce RIO Dec $22.50 Puts (RIO-XX) at the offer of $2.15. No stop for now, targeting $18.75 in the underlying.

Bullish swing traded long 1/2 position in shares of California Pizza Kitchen (CPKI) at $30.38. Stop currently $28.75, targeting $34.00.

Bullish swing traded long one (1) of the United Parcel UPS Jan $75 Calls (UPS-AO) at the offer of $3.00. No stop for now, targeting $79.50.

Jeff Bailey : 10/3/2006 5:28:29 PM

Closing Internals found at this Link

Jeff Bailey : 10/3/2006 5:02:49 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 10/3/2006 4:57:46 PM

California Pizza Kitchen Opens at Foxwoods Resort Casino ... Company Press Release Link

Jeff Bailey : 10/3/2006 4:48:08 PM

Valero Energy Sees Record Quarterly Income

DJ- Valero Energy Corp. (VLO) after Tuesday's closing bell said it expects to report third quarter earnings of $2.25 to $2.35 per share, a record for the period.

Valero said the outlook excludes a $132 million pretax gain on the July sale of 40% of the company's interest in Valero L.P.

Marc Eckelberry : 10/3/2006 4:27:33 PM

I hear you Keene. Lots of shorts out there. But I put the noise aside and look at the internals which are awful. We made a historic new high for the DOW with a pretty dismal showing from techs and an AD line that is getting weaker everyday.

Keene Little : 10/3/2006 4:21:36 PM

I like that level Marc--its the July uptrend line and bottom of its ascending wedge. It's looking like the RUT chart I posted but about a week behind. At least I hope it will follow the RUT's example. I'm certainly a very nervous bear here.

Marc Eckelberry : 10/3/2006 4:18:13 PM

Keene, I think ES tests 1331, 20 dma. It will usually do what NQ did, a day or two late.

Marc Eckelberry : 10/3/2006 4:16:20 PM

Jane is an expert on ticks and she can elaborate more, if she wants.

Keene Little : 10/3/2006 4:13:07 PM

In fact, looking at that RUT chart, if we've had a 1-2, 1-2 wave count to the downside from its September high, Jim's downside target of 710 for ER (about 705 for the RUT) won't even be a speed bump since we could be ready to enter a 3rd of a 3rd wave down. That would be the screamer. I'll believe it when I see it but that's the potential as I look at that chart.

Marc Eckelberry : 10/3/2006 4:16:00 PM

Someone asked me about tick fades, basically, I short +800 to +1000 tick readings on a downtrending day or a day that I feel will reverse. Basically, extreme tick readings are a sign of excess buying or selling, but be careful to not fade ticks on a strong up day. That is suicide. It's just a tool for an entry when you establish your game plan prior to that. It is very useful because you can set your stop pretty close and thus risk little. Pros never do a reversal entry without it. Period.
I also use ticks as divergence reading when I want to fade the open (higher highs/versus higher highs in price)and it is useful as corroboration That is much trickier because you have only seconds to act.

Jane Fox : 10/3/2006 4:09:30 PM

January 14th the DOW hit a high of 11749 and a close of 11722. Today's close was 11727 and daily high was 11758. Link

Keene Little : 10/3/2006 4:09:26 PM

The 60-min chart of the RUT shows a good example of trend lines being broken and then acting as resistance on a retest. After breaking back inside its ascending wedge on Sept 21st and bouncing off the bottom of the wedge it climbed back up for a retest of the top on Sept 28th. It then fell through the bottom of the wedge yesterday and today came back up for a retest. The RUT is trading well technically and it looks like Jim has picked so good ER trades. Link

Marc Eckelberry : 10/3/2006 4:08:42 PM

Both NQ and ES hold on to 61.8% today, which is some comfort for bulls. I closed my ES short from 1346.25 at 1343 and I will wait and see what happens here. I was stopped on QM long, but I am back in at 58.55. This is a counter-trend play up to 59.50, which will invariably be tested soon and probably sold. I think stronger support is at 57.75.

Jane Fox : 10/3/2006 4:02:30 PM

Economic Reports for tomorrow include:

10:00a.m. Aug Factory Orders. Previous: -0.6%.

10:00a.m. Sept ISM Non-Mfg Business Index Previous: +57.0

Jim Brown : 10/3/2006 4:01:59 PM

ER Short - With the ER hitting 722 at the close am reminding everyone that took my afternoon short at 728 that my initial target is 710 on this dip.

Marc Eckelberry : 10/3/2006 4:01:40 PM

ES 10 mn. Today's fibs will be in play tomorrow: Link

Keene Little : 10/3/2006 3:55:45 PM

I of course meant 1352 for my puke point. I still have problems typing 1300's for SPX and ES. What are we doing up here?

Jim Brown : 10/3/2006 3:52:13 PM

Keene, I am in 100% agreement. That means we are probably wrong! (grin)

Keene Little : 10/3/2006 3:51:15 PM

Looking at SPX the pull back from its high today is leaving a bearish impression on the chart. That kiss goodbye (if that's what it is) at the top of the wedge looks like an ideal place to have shorted the market today. A break above SPX 1338 should be a good place for stops on your longer term short positions. SPX 1252 remains my puke point on my positions (bear call spreads, long December puts).

Jim Brown : 10/3/2006 3:50:25 PM

Jane you are right. The Dow is respecting its PDH at 11725 or so.

Marc Eckelberry : 10/3/2006 3:42:46 PM

NDX high today was the 2005 close, so techs are still in the red for the year.

Jane Fox : 10/3/2006 3:42:31 PM

Make sure you see YM break its support at its PDH before you get too bearish.

Jim Brown : 10/3/2006 3:40:52 PM

ER trying to break that support at 724 that has held all afternoon. Internals falling and it appears we are sitting up for another decline.

Jim Brown : 10/3/2006 3:37:10 PM

I like that gold held at 580 and I am thinking about a long entry on the YG if it rebounds back over 582.50. That would be a higher high over that spike at 1:15pm.

Jeff Bailey : 10/3/2006 3:36:05 PM

U.S. September Auto Sales Up As Gasoline Prices Decline

DJ- U.S. auto sales picked up in September from both their year-ago level and from the August sales rate, helped by the psychological boost from a decline in gasoline prices.

Based on data reported Tuesday, total auto sales are estimated to have been at a 16.7 million annual rate in September, up 1.4% on a selling-day-adjusted basis from the September 2005 level of 16.5 million. Sales were up 4.3% from the 16.0 million selling rate in August.

Economists surveyed by Dow Jones Newswires had been expecting a 16.5 million annual selling rate for auto sales in September.

U.S.-made sales settled at a 13.0 million annual rate, up 4.6% from the 12.4 million rate reported in August but down 0.9% from the 13.1 million in September 2005.

The overall sales estimate is still below the 16.9 million selling pace for the full years of 2004 and 2005. U.S.-made cars and light trucks sold at a 13.5 million pace in both 2005 and in 2004. Moreover, total auto sales averaged a 16.5 million sales rate in the first eight months of 2006, while domestically-produced autos averaged a 12.9 million annual rate over the same period.

The September sales benefitted on a month-to-month basis as average regular gasoline prices declined by 14.8% to $2.497 per gallon in September from an average price of $2.930 per gallon in August. "Truck sales did a lot better and it looks like the gas price decline helped a bit," said Rebecca Lowry, an economist at Wrightson ICAP in Jersey City, N.J. "Buyers who had likely put off purchases got a psychological motive to buy in September."

Lowry estimates that domestically made cars sold at a 5.4 million annual rate and light trucks sold at a 7.6 million annual rate in September. When an estimate for sales of imports is included, Lowry estimates that total auto sales were at 16.7 million rate in September.

Other economists had a similar sense that the month-to-month pickup in auto sales were helped by falling gas prices and were a sign of healthy consumer spending to come.

"We always try to avoid making the correlation too strong with gas prices, but these sales results look like they benefitted from that decline," said Mike Englund, chief economist at Action Economics in Boulder, Colo.

Englund and his colleagues estimate that total auto sales were at a 16.7 million annual pace, with domestic car sales at 5.4 million, domestic truck sales at 7.6 million, and imports at 3.7 million.

Moreover, he believes that the pickup in auto sales at the end of the third quarter is indicative of good news for the fourth quarter. "We expect that real personal consumption expenditures will be up at a 4.6% annual rate in fourth quarter with strong holiday sales because of spending power freed up by lower gas prices.

While he looks for fairly strong vehicle sales in the fourth quarter, he believes that caution on the part of the Big Three auto makers may hold down production and limit the sales gain.

Jeff Bailey : 10/3/2006 3:33:53 PM

2 Hijackers Of Turkish Plane Surrender To Police (reports)

DJ- Two Turks who hijacked a Turkish Airlines jet carrying 113 people from Albania to Istanbul on Tuesday have surrendered to Italian police, Italian news agencies reported.

The two were trying to deliver a message to Pope Benedict XVI protesting his planned trip to Turkey.

A spokeswoman for ENAC, Italy's civil aviation body, said about two hours after the plane landed that the hijackers were getting off the plane, and the Italian news agencies reported that they had surrendered.

Marc Eckelberry : 10/3/2006 3:29:14 PM

Dec gold did indeed find support at 579 gap close. NQ can't get above 1662 and that is hurting the broader market. I think it is only a matter of time before worries about SPX earnings from energy starts flitering in.

Keene Little : 10/3/2006 3:23:05 PM

From a short term perspective it looks like QM should be finding a short term bottom soon. It could drop down to around $58 and should be completing its 3rd wave down in the drop from last week's high. That would mean a sideways/up consolidation for a day or two before dropping to a final low that should set up a 4th quarter rally.

Jeff Bailey : 10/3/2006 3:22:45 PM

03:00 Internals found at this Link

Marc Eckelberry : 10/3/2006 3:09:48 PM

The diverging views on oil make for a market:
Oct. 3 (Bloomberg) -- Crude oil fell to a seven-month low on speculation that a government report will show U.S. fuel inventories jumped. Supplies of distillate fuel, a category that includes heating oil and diesel, rose 1.5 million barrels last week, according to the median of responses in a Bloomberg News survey before tomorrow's report. Gasoline stockpiles also increased 1.5 million barrels. Analysts discounted moves by OPEC members Venezuela and Nigeria to cut supply. "U.S. inventories are high and it doesn't look like the situation will change anytime soon," said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. "We are drifting toward $50 because I doubt that OPEC will make a meaningful cut until we get there." Crude oil for November delivery fell $2.36, or 3.9 percent, to $58.67 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. It was the biggest one-day decline in almost 14 months. Oil touched $58.60, the lowest since Feb. 16. Prices are down 10.4 percent from a year ago. Futures have dropped 25 percent from a record $78.40 a barrel on July 14 as tensions in the Middle East eased and U.S. fuel stockpiles increased. Crude oil, gasoline, heating oil, diesel and natural gas supplies in the week ended Sept. 22 were above the five-year average for the period, the Energy Department said. Higher Prices Ahead Oil analysts are raising their price estimates for next year in anticipation of increased demand that may outpace the development of new fields. Crude oil will average $64 a barrel in New York in 2007, according to the median forecast of 29 analysts surveyed by Bloomberg News last week. That's $2 higher than estimated at the end of the second quarter. "The recent fall in prices is due to short-term factors," said Kevin Norrish, a director of commodities research for Barclays Capital in London. Barclays expects oil next year to average $76.70 a barrel, the highest forecast in the survey. "We're looking for fairly strong global growth, and we don't see capacity expanding by much." Oil's climb from less than $20 a barrel at the end of 2001 has been driven by the failure of producers to generate new supplies fast enough to keep pace with rising demand, especially in China. Analysts are betting that trend will continue. Iran's Nuclear Program Prices surged during the first half as Iran, the fourth- largest oil producer, pushed ahead with nuclear fuel enrichment, heightening tensions with the U.S. Iran has the world's second- biggest proved oil reserves and borders the Strait of Hormuz, a waterway through which almost a quarter of the world's oil is shipped. France said Iran must suspend its uranium enrichment efforts before it makes further proposals on how to end the dispute. Iran said earlier today that French nuclear company Areva SA could oversee uranium enrichment in Iran to guarantee that it was intended for peaceful purposes. Strategists who forecast a drop in prices next year say a slowing U.S. economy will coincide with increased output. The U.S. consumes 25 percent of the world's oil. "We're very pessimistic about the U.S. and global economy next year," said Eoin O'Callaghan, an analyst with BNP Paribas SA in London, who expects oil to average $59.80 next year. "The last four years there's been limited spare capacity, making us sensitive to disruptions and geopolitical risk." The Institute for Supply Management said yesterday its U.S. manufacturing index dropped to 52.9, the lowest since May 2005. A report tomorrow on services will probably show a slowdown, a Bloomberg News survey showed. "Weaker U.S. economic growth is going to translate into lower growth in China and India," said Bill O'Grady, an analyst with AG Edwards & Sons in St. Louis. "OPEC is not ready to seriously cut production yet because the Saudis think lower prices are a positive event." Saudi Arabia, the world's biggest oil exporter and the Organization of Petroleum Exporting countries' most influential member, has not announced a production cut. "Prices are still at a good level," Saudi Arabian Oil Minister Ali al-Naimi said on Sept. 19. Venezuela and Nigeria, which already produce less than their OPEC targets, said last week that they would lower output by a combined 170,000 barrels a day from Oct. 1. OPEC President Edmund Daukoru said members of the group should follow Nigeria's example in cutting production because the market is "slightly oversupplied," Reuters reported today. Daukoru, who is also Nigeria's oil minister, said today's decline in oil prices to below $60 a barrel vindicated Nigeria's decision on Sept. 29 to cut production.

Jeff Bailey : 10/3/2006 3:03:04 PM

03:00 Market Watch found at this Link

Jane Fox : 10/3/2006 2:59:19 PM

I will need to see YM break its support at its PDH before I get too bearish today.

Marc Eckelberry : 10/3/2006 2:54:41 PM

Triple top ES with bearish divergences. They are gunning for the stops, but it is on weaker relative strength.

Jeff Bailey : 10/3/2006 2:52:28 PM

Bullish swing trade call option alert for one (1) of the United Parcel UPS Jan $75 Calls (UPS-AO) at the offer of $3.00.

Jeff Bailey : 10/3/2006 2:52:22 PM

United Parcel (UPS) $74.03 +2.25% Link ... breaking free of trend!

Marc Eckelberry : 10/3/2006 2:49:04 PM

This DOW high thing is a real bore. In real dollar terms, a new DOW highs would be 14,000. All this is doing is making for some short covering, but no one else is really that interested other than retail investors and CNBC. Volume is pathetic for such a "watershed" event. There is one positive though, and that is the TRAN finally breaking out above 200 dma. Let's se if that builds legs.

Jeff Bailey : 10/3/2006 2:48:19 PM

Union Pacific (UNP) $88.55 +1.59% Link ... the "Crazy Train?"

Jeff Bailey : 10/3/2006 2:47:13 PM

Dow Transports (TRAN) 4,501 +1.52% Link ... bold move back above its 200-day SMA.

Dow theory getting some "confirmation" ... I think it can, I think it can.

Marc Eckelberry : 10/3/2006 2:45:02 PM

There is still downside risk to QM so I would use tight stops. Weekly S2 is at 57.775 and commodities have a habit of hitting pivots, so be careful. Nevertheless, we first see if 58.60 holds.

Keene Little : 10/3/2006 2:43:33 PM

We've got some big money defending these highs and they don't want to see a sell off start.

Marc Eckelberry : 10/3/2006 2:37:41 PM

YG December closed the gap at 579. If oil holds, itwillhold as well. Talks about finding gold in the sea is not going to change the xmas season.

Marc Eckelberry : 10/3/2006 2:36:51 PM

Lehman did some serious damage tothe energy sector, but kepe inmind, he is the only one that mde that call. I any case, if he is right, then you should be shorting ES, not buying it. Earnings power has mostly come from there.

Jeff Bailey : 10/3/2006 2:34:36 PM

AMEX Gold Bugs ($HUI.X) 283.52 -6.38% Link ... breaks September lows.

Jane Fox : 10/3/2006 2:30:14 PM

Geesh Gold is 579 almost to its 576 support.

Jeff Bailey : 10/3/2006 2:30:40 PM

Healthcare Providers (RXH.X) 452.18 -1.44% Link ... bold move back below its 200-day SMA.

Jane Fox : 10/3/2006 2:29:05 PM

AD line and volume plunging although not to new daily lows - yet.

Keene Little : 10/3/2006 2:27:48 PM

This kind of sharp selloff is not what bulls want to see.

Jane Fox : 10/3/2006 2:27:29 PM

YM should find support at its PDH. Notice where ES found its resistance? Link

Marc Eckelberry : 10/3/2006 2:25:39 PM

Someone hit the dump switch.

Jeff Bailey : 10/3/2006 2:22:24 PM

Mattel, Inc. (MAT) $19.91 +2.41% Link ... breaks above congesting high. New 52-weeker here.

Jim Brown : 10/3/2006 2:20:59 PM

Marc, I am with you . Long QM now at 58.75 with a tight stop at 58.50

Marc Eckelberry : 10/3/2006 2:14:11 PM

QM at November low. This is my first target to hit it long (58.65).

Marc Eckelberry : 10/3/2006 2:08:04 PM

Watch NQ 1662. That is the key. SMH is stuck below 200 ema, 10 and 20 dma. Nothing bullish there, expect a bounce off support at lows.

Keene Little : 10/3/2006 2:07:28 PM

Even the mighty DOW is starting to show some short term negative divergences as it tries to press higher again. With overbought 30 and 60-min charts it will be hard pressed to continue higher. But we know there's big money behind this push so I continue to be cautious about the short side (testing it but not blindly holding onto positions).

Marc Eckelberry : 10/3/2006 2:07:23 PM

Right now, repsect the tape, but if long, I would be moving up stops and booking profits on every bounce.

Marc Eckelberry : 10/3/2006 2:05:49 PM

I think ES is still vulnerable to the 20 dma at 1331.

Marc Eckelberry : 10/3/2006 2:04:20 PM

When you think of the impact on energy earnings for what has been the leading sector for SPX for 4 years, you have to wonder. But that is the way it goes sometimes. ES has R right here.

Jeff Bailey : 10/3/2006 1:59:22 PM

Bullish swing trade long alert for 1/2 position in shares of California Pizza Kitchen (CPKI) $30.38 +0.93% ... LIMIT to $30.50, stop $28.75 to begin, target $34.00.

Disclosure: I currently hold bullish position in CPKI

Jeff Bailey : 10/3/2006 1:55:16 PM

Istanbul Deputy Gov: Turkish Hijackers To Give Up Soon

DJ- Istanbul's deputy governor said Tuesday Turkish hijackers who commandeered a Turkish Airlines plane from Tirana, Albania, to Istanbul, had agreed to give themselves up shortly.

"They will give themselves up within 10 minutes," Deputy Gov. Vedat Muftuoglu told CNN-Turk television said.

The plane landed at Italy's Brindisi airport.

Private NTV television, quoting unnamed security officials, reported that the plane was hijacked by two Turks to protest Pope Benedict XVI's planned visit to Turkey next month.

Keene Little : 10/3/2006 1:45:43 PM

It will be important for at least the short term for the bulls to hold onto today's gains. Another sell off this afternoon will be strong evidence that smart money is using all rallies to hand off inventory.

Marc Eckelberry : 10/3/2006 1:42:58 PM

I like oil at 57.75 if we get there. For now, scalp longs. I prefer not to short QM. That's just me.

Keene Little : 10/3/2006 1:42:13 PM

A more precise prediction for the bottom for oil is $58.10 which is where the 5th wave will equal the 1st wave. However, the short term pattern for the move down from last week's high suggests we'll see oil drop a little lower than that.

Jeff Bailey : 10/3/2006 1:36:59 PM

PIER 1 TO STOP PAYING QUARTERLY DIVIDEND

DJ- Shares fell as much as 8% after the troubled home-furnishings retailer makes the move in order to improve near-term liquidity and provide financial stability. Firm is in the midst of executing a turnaround strategy.

PIR $7.57 -2.19% Link

Keene Little : 10/3/2006 1:36:01 PM

We've had a big move down in oil this week and it confirms the trend change that I've been predicting in oil. The impulsive move down from its high in July is now into its 5th wave down and the impulsive move tells me we've seen the high for oil for quite some time. Once this current 5th wave down is complete, and I still believe the mid to upper $50's will do it, we'll then see oil get a much bigger bounce to correct that 5-wave move. Link

After the bigger bounce, which should be a 3-wave move, the price of oil should continue to decline into 2007. This EW view supports my contention that we'll see the price of oil drop due to a global economic slowing. I think it's one of the best predictors we have of what's coming down the pike.

Jane Fox : 10/3/2006 1:35:38 PM

... and still falling.

Jane Fox : 10/3/2006 1:35:01 PM

Gold is down $22.00 today.

Jeff Bailey : 10/3/2006 1:34:56 PM

HASTERT REJECTS RESIGNATION CALL

DJ- U.S. House speaker dismisses call by Washington Times that he step down amid a sex harassment scandal. Hastert maintains appropriate for GOP to resolve matter internally, saying more formal probe would have brought in Democrats.

Jane Fox : 10/3/2006 1:34:18 PM

ZG's resistance at 612 to 616 was so clear and just like clockwork it failed at that spot. I love it when the charts are so clear.

Jeff Bailey : 10/3/2006 1:34:06 PM

N KOREA TO CONDUCT NUCLEAR TEST

DJ- Country says plan is part of measures to bolster defenses amid what North Korea calls increasing U.S. hostility. No date set. Japan calls plan "totally unforgivable" and U.S. says it is "a reckless action." South Korea raises security level.

Jeff Bailey : 10/3/2006 1:33:22 PM

FORD LAUNCHES 'TRUCK MONTH' INCENTIVE CAMPAIGN

DJ- Auto maker offers financing deals on many vehicles in order to maintain its position in the truck segment and spur overall sales. Campaign includes 0% financing deals for 60 months on all 2006 pickups and many other 2006 vehicles.

Jane Fox : 10/3/2006 1:32:37 PM

Keene I agree. My Gold indicators indicate that the 576 support will not hold. We may get a bounce at 576 (or there abouts) but eventually it will break. This of course is from a purely technical standpoint and does not take into consideration the fundamentals that many of my Goldbug friends like to point out. However, I am a firm believer in the fact that all fundamentals are already built into the charts so in essence I guess I am taking them into consideration.

Jeff Bailey : 10/3/2006 1:32:13 PM

JOBS CUTS SURGE 54% IN SEPTEMBER

DJ- Corporations announce 100,315 layoffs last month, the highest since January, according to Challenger, Gray & Christmas survey. One-third of the cuts come from the auto industry.

Keene Little : 10/3/2006 1:27:32 PM

Gold is so far following the bearish EW pattern as I've got it labeled. By holding under 616.50 on the bounce it maintains a clear impulsive wave count to the downside. Until I see something negate the bearish wave count this shows an update to the chart I'm using to monitor the move lower. The initial downside target per this count and Fib projection is 509 but it will not be in a straight line. Link

Marc Eckelberry : 10/3/2006 1:24:40 PM

Gold Rush Plunges Undersea as Miners Scour Pacific Link

Jeff Bailey : 10/3/2006 1:19:23 PM

01:07 Internals found at this Link

Marc Eckelberry : 10/3/2006 1:18:52 PM

YG has a gap close at 579. Oil is holding up above S2. The discrepancy should be corrected either way.

Marc Eckelberry : 10/3/2006 1:15:17 PM

Even with oil dropping, TRAN stalls at 200 dma once again.

Marc Eckelberry : 10/3/2006 1:12:48 PM

I'm with you Jim. Not only are small caps lagging, the hit on the energy sector will impact earnings. Add the SOX warnings and you have a bearish mix.

Marc Eckelberry : 10/3/2006 1:10:49 PM

1662 is not only weekly PP it is also 10 dma. With the SOX like this and only +187 NAZ ADVDEC, you have to wonder what this is all about, if not short covering. QQQQ volume is only 61% of normal.

Jeff Bailey : 10/3/2006 1:10:12 PM

01:07 PM Market Watch found at this Link

Marc Eckelberry : 10/3/2006 1:09:37 PM

Small risk, just to see if I'm right about 1662.

Jim Brown : 10/3/2006 1:09:24 PM

I am short the Russell futures again at 728 with a target of 710 on this entry. I believe S&P resistance at 1340 will hold and the small caps will lead us back down.

Marc Eckelberry : 10/3/2006 1:08:44 PM

It's a little bit suspcicious. SOX is still red, breadth is weak. I took an NQ short at 1661.75, stop 1662.75, just to keep them honest.

Marc Eckelberry : 10/3/2006 1:06:46 PM

NQ 1662 is support if bulls mean business.

Marc Eckelberry : 10/3/2006 1:06:23 PM

As for gold, it is slave to oil right now, but the Iran and N Korea situation could chane things very quickly. I would not recommend being short either at this point.

Marc Eckelberry : 10/3/2006 1:05:34 PM

It is not uncommon for the DOW to follow a futures resistance number. Thus 11808 is a good target to shortthe DOW if we get there, but it will have to get above 11771.50.

Marc Eckelberry : 10/3/2006 1:04:46 PM

Above the new highs, DOW has R at 11,771.50, 100% August projection.

Keene Little : 10/3/2006 12:59:12 PM

The brokers are making a new high I had mentioned last week would be a good way to finish off its rally--it gives us the 5th wave of the small ascending wedge since Sept 19th. It continues to press against its broken uptrend line from May 2005. It may not be quite finished rallying yet but this one is very close and I think is an excellent short play again. Link

Marc Eckelberry : 10/3/2006 12:57:35 PM

TEHRAN (Reuters) - The United States and Britain said on Tuesday Iran could soon face sanctions because it showed no sign of halting sensitive nuclear work, while the EU said the latest talks had been helpful but had brought no breakthrough.

Marc Eckelberry : 10/3/2006 12:56:51 PM

SEOUL (Reuters) - North Korea said on Tuesday it would conduct its first nuclear test, and Washington warned it would respond to such an "unacceptable threat" to world peace.

Jeff Bailey : 10/3/2006 12:54:23 PM

Ameritrade (AMTD) $18.99 +1.76% Link ... (see 12:50:17)

Keene Little : 10/3/2006 12:51:44 PM

Lest you think new DOW highs are a prelude of much greater things to come, once again we need to look at market breadth. With the major indices challenging/beating the highs in May, why don't we see greater participation? Looking at the number of 52-week highs vs. lows at the May high, we had 395 NH for the NYSE on May 5th and 43 new lows. Today's numbers are so far 101 and 41, resp.

This is of course for the NYSE which is not making new highs with the DOW. It might be a DOW-only event which would be a bearish non-confirmation if the others don't join in. The number of new highs continues to climb but I'm thinking it won't make it to 395. New market highs without broader participation is not bullish. We have no idea how high it can continue to go but it does warrant caution. There are games being played here.

Jeff Bailey : 10/3/2006 12:50:17 PM

Broker/Dealer Index (XBD.X) 231.03 +1.03% Link ... another test for bears here.

Jim Brown : 10/3/2006 12:49:39 PM

ER SHort The ER short I suggested last Thursday at 739 blew by my initial target this morning at 720 and hit a low of 716.60. I was stopped out on the rebound but I am looking to get back in on any weakness now that the Dow has finally made its new high. That short was good for +19 ER points to my initial target at 720.

Jane Fox : 10/3/2006 12:47:01 PM

Sort of figured you would have noticed Jeff. Not much gets past you.

Jeff Bailey : 10/3/2006 12:45:59 PM

I was going to let Marc or Keene take honors Jane. But yes I did notice.

Jane Fox : 10/3/2006 12:45:25 PM

BAck in January 2000 the DOW hit 11749 and today 11754.

Jane Fox : 10/3/2006 12:43:45 PM

BTW did anyone notice that the DOW has hit a new all time high today?

Jane Fox : 10/3/2006 12:41:22 PM

Gold to new daily lows.

Jeff Bailey : 10/3/2006 12:40:10 PM

MARVELL DOWN AFTER 3Q WARNING

DJ- Shares of storage and communications chip maker drop 15% a day after it issues a warning that 3Q sales are expected to be down 10% from 2Q results. 3Q sales of $522 million are expected, way below target of $580 million.

MRVL $16.40 -14.09% Link

Jeff Bailey : 10/3/2006 12:38:44 PM

REDBOOK RETAIL SALES UNCHANGED

DJ- National chain store sales are unchanged in September versus previous month, according to Redbook Research. International Council of Shopping Centers-UBS Retail Chain Store Sales Index decreases by 0.3% in week ended Sept. 30.

Jeff Bailey : 10/3/2006 12:38:05 PM

KOHL'S SAME-STORE SALES SURGE 16%

DJ- Retailer's stout performance and revenue from firm's initial recognition of gift-card breakage revenue results in the company boosting its 3Q earnings forecast by 3c to 56c-59c a share.

KSS $66.55 +1.61% Link

Keene Little : 10/3/2006 12:37:59 PM

Looking at the SPX chart I posted earlier (11:02), the top of the ascending wedge that it broke down inside yesterday is currently at 1338 (cash) and it'll be an interesting test to see if it acts as resistance now.

Jeff Bailey : 10/3/2006 12:36:23 PM

OIL PRICES SLIDE BELOW $60 ON HURRICANE FORECAST

DJ- New York crude oil futures slump nearly $2, falling below $60 a barrel after the Colorado State University reiterates a call for below-normal Atlantic storm activity because El Nino conditions developed faster-than-expected. Also pressuring crude prices are easing concerns that OPEC will cut production, and the U.S. Department of Energy said it will delay buying oil to fill the nation's strategic petroleum reserve.

Jeff Bailey : 10/3/2006 12:34:35 PM

Bear Stearns (BSC) $143.44 +0.66% Link ... challenges "right shoulder" of h/s top. Short could be pressured here.

Marc Eckelberry : 10/3/2006 12:33:08 PM

NQ is still a short below 1661/1662. SMH and SOX are lagging. Nevertheless, this is a big turnaround for bulls and it's all about DOW 11750 and massive short covering. You should not be short NQ above 1662, or at least use extreme caution.

Keene Little : 10/3/2006 12:32:42 PM

Ding, ding, ding. The DOW has rung the bell.

Keene Little : 10/3/2006 12:29:02 PM

The DOW is clearly headed for its all-time high today (11750.28). Only a few pennies to go. How else can they continue to suck in the sheeple to whom they can hand off the inventory.

Jane Fox : 10/3/2006 12:23:09 PM

Needless to day the AD line and volume have reversed but they are still not what you would call bullish. Link

Jeff Bailey : 10/3/2006 12:22:00 PM

Turkish Airlines Plane Hijacked, Lands In Italy

DJ- A Turkish Airlines (THYAO.IS) plane carrying 107 passengers from Tirana, Albania, to Istanbul, was hijacked Tuesday and landed at Italy's Brindisi airport, company spokesman Ali Genc said.

The plane was hijacked in Greek airspace at around 6 p.m., Genc said.

Private NTV television, quoting unnamed security officials, reported that the plane was hijacked by two Turks to protest Pope Benedict XVI's planned visit to Turkey next month.

Jane Fox : 10/3/2006 12:20:46 PM

MACD is saying all is well in bull country. No divergences. Link

Keene Little : 10/3/2006 12:19:30 PM

The DOW of course has already broken its short term downtrend line from last week.

Jeff Bailey : 10/3/2006 12:18:45 PM

I think I can, I think I can, I think I can ....

Keene Little : 10/3/2006 12:18:26 PM

ES is running into its downtrend line from last Thursday's high at 1346.25. It looks ready for a pullback.

Jeff Bailey : 10/3/2006 12:18:06 PM

Ameritrade (AMTD) $19.05 +2.09% ... back to probe its still trending lower 200-day SMA.

Jeff Bailey : 10/3/2006 12:15:37 PM

QQQQ $40.34 +0.49% ... after morning test of correlative DAILY S1/WEEKLY S1.

Jeff Bailey : 10/3/2006 12:13:20 PM

Commercial Airliner Hijacked In Greek Airspace (Radio)

Turkish Airline Says Hijacked Plane Lands At Brindisi

Hijack To Protest Pope's Turkish Visit - TV

Keene Little : 10/3/2006 12:12:14 PM

Certainly by the looks of the DOW I'd say the pullback is over and now we're driving to new market highs.

Jeff Bailey : 10/3/2006 12:06:14 PM

ECBOT looks to be up and running now Jane.

Jane Fox : 10/3/2006 12:06:10 PM

ECBOT now open!

Jane Fox : 10/3/2006 12:02:43 PM

12:00ET has come and gone and I see ECBOT is still not open.

Jeff Bailey : 10/3/2006 12:02:42 PM

CRB Index (cr00y) 295.81 -1.84% ... sets up for test of May05 relative lows (293)

Jeff Bailey : 10/3/2006 11:59:13 AM

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

Jane Fox : 10/3/2006 11:47:34 AM

* NYSE VOLUME 628.2M
* NYSE HAS 1,484 ADVANCERS
* NYSE HAS 1,586 DECLINERS
* NYSE HAS 183 ISSUES UNCHANGED
* NYSE HAS 102 ISSUES SETTING 52-WEEK HIGHS
* NYSE HAS 37 ISSUES SETTING 52-WEEK LOWS
* NASDAQ VOLUME 758.3M
* NASDAQ HAS 1,291 GAINERS
* NASDAQ HAS 1,494 LOSERS
* NASDAQ HAS 150 ISSUES UNCHANGED
* NASDAQ HAS 82 ISSUES SETTING 52-WEEK HIGHS
* NASDAQ HAS 76 ISSUES SETTING 52-WEEK LOWS

Jane Fox : 10/3/2006 11:42:29 AM

Hi Jane,
I think I see a nice H&S on the Rut 240 minute.
Lynne
Yes indeed we do have a H&S on the 240 (I used ER instead of the RUT). Now we need to see a 240 minute close below the neckline and then a retest to confirm it. Nice catch Lynne. Link

Jeff Bailey : 10/3/2006 11:41:31 AM

Alert! RIO Dec. $22.50 Puts symbol is RIO-XX

Marc Eckelberry : 10/3/2006 11:38:25 AM

QM bullish divergence 5 mn chart on that lower low, but needs to hold 59.05 now: Link

Jeff Bailey : 10/3/2006 11:40:41 AM

Swing trade put option alert ... let's take two (2) of the Rio Companhia Vale do Rio Doce RIO Dec $22.50 Puts (RIO-XX) at the offer of $21.15. No stop for now, target $18.75.

RIO $21.37 -2.10% Link

Disclosure: I currently hold a bearish position in RIO

Tab Gilles : 10/3/2006 11:36:11 AM

Jane,

I agree...with commoditiy prices and bonds indicating that inflation is not a threat, as long as earnings can keep on coming in...I'd say the Fed will not move. All positives for a year end rally.

The Fed raised rates just enough to give them some room to lower if there happens to be signs of a recession.

Remember there are only 2 things the stocks market has looked at over the long term...

Earnings & Interest rates

Marc Eckelberry : 10/3/2006 11:36:10 AM

Resistance is 59.275 and 59.525.

Marc Eckelberry : 10/3/2006 11:35:59 AM

QM bid.

Jane Fox : 10/3/2006 11:34:18 AM

ECBOT to be reopened at 12:00EDT.

Keene Little : 10/3/2006 11:33:36 AM

The lows of the trading range last week was ES 1343 and that became resistance during yesterday afternoon's bounce. If this is going to be just a bounce that leads to another move lower, watch 1344 which is where the 2nd leg up this morning achieves 162% of the 1st leg up.

Marc Eckelberry : 10/3/2006 11:35:51 AM

QM clinging to S2 at 59.05 and YG re-opened holding 587, which is interesting since oil dropped much further. The North Korea news is probably going to help gold at some point.

Jane Fox : 10/3/2006 11:31:52 AM

I see ECBOT is not operational yet. Hopefully any one short YM took Marc's advise and hedged with ES.

Jane Fox : 10/3/2006 11:29:37 AM

Let me repharse my last comment. I would like to change the word "will" to the "highest probabality" is that we will have another run at yearly highs.

Jane Fox : 10/3/2006 11:25:58 AM

Tab I agree this is just a pullback and all my indicators say we will have another run at yearly highs.

Jane Fox : 10/3/2006 11:24:36 AM

I shorted Gold yesterday based on the fact that Oil was down and I suspected Gold would follow. Today Gold is leading Oil down.

Tab Gilles : 10/3/2006 11:23:22 AM

Everything is down, oil, gold stocks.... As suspected the run up in Sept is now succumbing to profit taking. The question remains...is this a minor pullback or a major selloff? My indicators say pulback.

Open Positions and Watch List Link

$NDX/$NAA Link

$NALOW/$NAHGH weekly 10ema

In this annotated chart I look at the 10 week ema, I haven't seen a sell signal as of yet. We may see monior pullbacks as the $NDX works higher. This is just one of several indicators I use. Link

$Weekly $NASI/$NDX MACD indicates downtrend/sell. Link

$NDXA50 Shorter term the $NDX stocks trading over 50-ma is above 70, a sell signal. Link

$NDX200 The 200ma has more to go. Link

$BPNDX Somewhat similar is the $BPNDX. Link

$VXN Link

Keene Little : 10/3/2006 11:15:10 AM

NDX is at/near some pretty solid support--its 200-dma is at 1626.33, 20-dma is at 1623.98 and its uptrend line from August is near 1621. Being short term oversold I'd be real surprised to see it break this support area without at least first consolidating/bouncing. Link

Jeff Bailey : 10/3/2006 11:13:26 AM

11:00 Internals found at this Link

Marc Eckelberry : 10/3/2006 11:07:29 AM

QM has close support at 59.05, then 58.70.

Jeff Bailey : 10/3/2006 11:03:08 AM

11:00 Market Watch found at this Link

Keene Little : 10/3/2006 11:02:19 AM

Not surprisingly SPX bounced off its May high just under 1327. That should provide at least temporary support. More bullishly a retest of that support level that holds could see the market push to new highs. Conversely if that support level breaks then we'll probably see the July uptrend line get tested, currently near 1320. Link

Marc Eckelberry : 10/3/2006 10:55:08 AM

YM traders should be hedging right now with ES.

Marc Eckelberry : 10/3/2006 10:54:24 AM

Everyone waiting to see if the QM dble bottom holds. With bond futures not printing, direction is difficult, but the dollar is down again. ES has serious resistance between 1338.75 and 1340.75.

Jeff Bailey : 10/3/2006 11:00:06 AM

Pricing out some Garmin Ltd. (GRMN) $47.05 -1.83% Link call options. No Dec contracts, and may have to go Jan07.

WEEKLY Pivot Levels ... $41.25, $45.01, Piv= $47.19, $50.95, $53.13.

MONTHLY Pivot Levels ... $38.29, $43.53, Piv= $46.45, $51.69, $54.61.

Marc Eckelberry : 10/3/2006 10:45:53 AM

ES gap open 1338.75, gap close 1340.75.

Marc Eckelberry : 10/3/2006 10:55:28 AM

ES has clear R at 9/25 high of 1340, especially if QM keeps a bid near 60. ECBOT is having problems, so gold is off the radar but it should move up with oil if it gets above 60.

Jane Fox : 10/3/2006 10:39:55 AM

... due to technical problems at the exchange.

Jane Fox : 10/3/2006 10:39:27 AM

YM traders please be aware that the ECBOT is unavailable.

Keene Little : 10/3/2006 10:37:52 AM

Jamming it higher again. It's hard to tell if this is the start of something bigger to the upside or just a bounce to stop out some shorts. The pattern to the downside still remains funky looking and could be just a corrective pullback.

Jeff Bailey : 10/3/2006 10:20:32 AM

Stop for the BHI-JN will be placed at $70.25 in the underlying.

BHI $65.78 -2.57% Link

Keene Little : 10/3/2006 10:15:28 AM

We're definitely seeing selling into the rallies. Or should I say we're seeing buying spikes to catch some shorts to create liquidity to sell into. That's the favorite ploy. But there seems to be a concerted effort to hold the DOW up and right now YM is just coming back down to retest its short term downtrend line from yesterday so a bounce back up to a new daily high could embolden the bulls.

Marc Eckelberry : 10/3/2006 10:12:20 AM

YG has support here at 587.20, but oil needs to stabilize.

Marc Eckelberry : 10/3/2006 10:11:47 AM

If 1336 does not hold, the next level would be 1330/1331. That's a steep run from here in one day, so we might very well keep 1336 temporarily, but it looks like 1331 is in the cards.

Jane Fox : 10/3/2006 10:10:54 AM

YM is without a doubt the most bullish today.

Jeff Bailey : 10/3/2006 10:09:00 AM

Swing trade sell naked calls let's sell two (2) of the Baker Hughes BHI Oct. $70 Calls (BHI-JN) at the bid of $0.60.

BHI $65.60 -2.85%

Jane Fox : 10/3/2006 10:08:21 AM

AD volume continues to make new daily lows so certainly not time to try a long position.

Marc Eckelberry : 10/3/2006 10:04:41 AM

ES has 50% support at 1336. Must hold as well..

Jeff Bailey : 10/3/2006 10:03:20 AM

10:00 Market Watch found at this Link

Marc Eckelberry : 10/3/2006 10:02:11 AM

NQ has trendline support around 1636.

Jane Fox : 10/3/2006 10:01:49 AM

Here is how the markets are trading in relation to their PDRs. Link

Jane Fox : 10/3/2006 10:00:30 AM

I am seeing evidence of a temporary bottom forming now.

Jeff Bailey : 10/3/2006 9:58:32 AM

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

Keene Little : 10/3/2006 9:55:00 AM

There's still a big effort to hold the DOW up relative to the others.

Jane Fox : 10/3/2006 9:51:29 AM

What a shame I didn't keep my Gold short from yesterday. Oh well!

Jane Fox : 10/3/2006 9:50:32 AM

I love it when the internals talk. Link

Jane Fox : 10/3/2006 9:49:30 AM

TRIN is 1.42 and the VIX hugging daily highs.

Marc Eckelberry : 10/3/2006 9:48:58 AM

The only refuge today has been bonds.

Jane Fox : 10/3/2006 9:47:09 AM

AD line is -1088 and AD volume falling straight down. Finally some clarity from the internals.

Keene Little : 10/3/2006 9:46:47 AM

However the COMP is just now testing its uptrend line from August 11th, currently at 2225.80.

Marc Eckelberry : 10/3/2006 9:46:14 AM

YG has a gap to close around 578. If QM loses 60, it has support only at 57.75. Nevertheless, YG opened with a very large gap and I doubt we will go much further down without at least closing some of it.

Jane Fox : 10/3/2006 9:45:44 AM

Keene ER is also breaking the support I talked about earlier this morning. So it needs to hold on here or that has much more bearish implications for the whole market.

Keene Little : 10/3/2006 9:44:03 AM

The RUT has broken its uptrend line from August 10th, which it worked hard to hold onto yesterday. I think the canary just fell off its perch.

Marc Eckelberry : 10/3/2006 9:40:55 AM

QM is barely holding on to 60. There are various reports out today, one bullish on oil the other negative.

Keene Little : 10/3/2006 9:40:42 AM

If this morning's selling continues, then the next level of support for ES is its uptrend line from Sept 11th at 1334 currently.

Jeff Bailey : 10/3/2006 9:40:37 AM

Bullish swing trade stop alert for the U.S. Oil Fund (USO) $54.50 -1.46% ...

Jeff Bailey : 10/3/2006 9:37:57 AM

U.S. Oil Fund (USO) $54.61 -1.26% ... undercutting WEEKLY S1 here.

Keene Little : 10/3/2006 9:36:16 AM

I had mentioned yesterday that ES 1337 would be a level to watch for support as that's the level where the 2nd leg down in the drop from last week's high achieved 162% of the 1st leg down. If all we're going to see is this 3-wave pullback and then another run to a new high, this is where it should occur. Right now it's hard to discount that possibility. I'll be watching to see if we get a sideways/up consolidation today and then another (5th) wave down to tell me we've got a trend change.

Jane Fox : 10/3/2006 9:35:04 AM

AD line is a bearish -636 and AD volume below 0 and falling.

Marc Eckelberry : 10/3/2006 9:28:58 AM

Gold inventories are down, the dollar is facing tough times ahead, but neverthless the energy drop is hurting gold short term. We could retest 577 if this area does not hold.

Marc Eckelberry : 10/3/2006 9:24:06 AM

QQQQ right at support (200 dma). 39.90 is absolute must hold.

Marc Eckelberry : 10/3/2006 9:23:44 AM

Gold took a definite hit on the Merryl energy sector downgrade. 590 is a key number to hold.

Jane Fox : 10/3/2006 9:22:17 AM

Everything I said about ES I could say about YM so no need to show its daily chart here, however, ER is a different story altogether. The MACD and RSI bearish divergences are the reasons I bot IWM puts on Friday but as you can see ER is now testing major support so I will probably get out of them this morning because I expect some sort of bounce here. Now if the bounce off support does not make a higher high I would become much less bullish on all markets. You need bullishness in all markets for it to be sustainable and if ER starts to turn bearish we may be witnessing one of the first signs of a market top. Link

Jane Fox : 10/3/2006 9:08:22 AM

ES could retrace all the way back to the bottom of its upward channel (~ 1317-1320) and still remain bullish. There is nothing on this chart suggesting to me that the retracement we have seen this week is anything more than a healthy pullback. Link

Jane Fox : 10/3/2006 9:04:31 AM

Yesterday I stated that I thought Gold could easily make it back to 576 but I certainly didn't expect it to make it that far this week. Gold is down 14 points overnight at 589 and within reach of 576 if it keeps up this bearishness.

I tried an Oil long last night but bailed when I saw it consolidating at lows, a for sure sign that it will go lower. Glad I did.

Natural Gas gyrated around its PDL most of the overnight session.

TBonds tagged its PDH overnight and as usual found resistance. Link

Jane Fox : 10/3/2006 8:57:41 AM

Good morning. Overnight all equity markets broke their PDLs except ER but this consolidating at overnight lows suggests further downside before we see a retracement. I will take a look at the daily charts later but I don't suspect the overall bullishness has changed much. Link

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