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Jeff Bailey : 11/8/2006 11:28:19 PM

That was then (US Senate elections, 1994) Link

Note: During that midterm election, Republicans also won the Senate for the first time since 1954. In late January of 1995, the S&P 500 closed at 470 after having just broken above its bundled 21-day, 50-day and 200-day SMAs earlier that month at the 460 level.

Keene Little : 11/8/2006 10:55:11 PM

Thursday's pivot tables: Link and Link

Jeff Bailey : 11/8/2006 10:51:51 PM

Democrats Take Control of Senate With Webb Victory In Va.

DJ- Democrats wrested control of the Senate from Republicans Wednesday with an upset victory in Virginia, giving the party complete domination of Capitol Hill for the first time since 1994.

Jim Webb's squeaker win over incumbent Sen. George Allen gave Democrats their 51st seat in the Senate, an astonishing turnabout at the hands of voters unhappy with Republican scandal and unabated violence in Iraq. Allen was the sixth Republican incumbent senator defeated in Tuesday's elections.

The Senate had teetered at 50 Democrats, 49 Republicans for most of Wednesday, with Virginia hanging in the balance. Webb's victory ended Republican hopes of eking out a 50-50 split, with Vice President Dick Cheney wielding tie-breaking authority.

Jeff Bailey : 11/8/2006 10:23:44 PM

Cisco Systems (CSCO) $25.10 +1.04% ... $27.01 was last tick in extended session.

Earnings Press Release Link

Consensus was non-GAAP of $0.29/share on Revenue of $7.90B

Jeff Bailey : 11/8/2006 10:13:43 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 11/8/2006 10:05:13 PM

Closing Internals found at this Link

Heavy volume at the NYSE and brisk at the NASDAQ today.

OI Technical Staff : 11/8/2006 9:59:59 PM

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Keene Little : 11/8/2006 4:05:25 PM

Well no buy program to let me out before the close. I've got a sell limit on my ES long at 1394 and a sell stop at 1388. We'll just have to see which one gets hit first. It looks like we're consolidating at/near the previous highs which should be bullish for another move higher. How much higher is hard to say and it's why I just want to scalp this long and then see what sets up next.

Jane Fox : 11/8/2006 3:43:55 PM

ES respecting its PDR again. Link

Keene Little : 11/8/2006 3:41:15 PM

Um, fellows, a buy program please?

Jane Fox : 11/8/2006 3:40:06 PM

Economic Reports for tomorrow.

8:30a.m. Initial Jobless Claims. For Nov 4 Wk. Consensus: -12K. Previous: +18K.

8:30a.m. Sept Trade Deficit. Consensus: $65.5B. Previous: $69.86B.

8:30a.m. Oct Import Prices. Consensus: -1.5%. Previous: -2.1%.

10:00a.m. Prelim U Of Mich Consumer Sentiment Index. COnsensus: 93.6. Previous: 93.6.

10:00a.m. Sept Wholesale Inventories. Consensus: +0.5%. Previous: +1.1%.

Jeff Bailey : 11/8/2006 3:36:04 PM

DIA $121.86 +0.25% ... it traded its DAILY R1 ($121.96) to the penny.

Keene Little : 11/8/2006 3:32:31 PM

I've raised the stop on my ES long from 1383 (breakeven) to 1388. Any corrective pullback here should not reach down that far. I've put in a sell limit at 1394 which I'm hoping to see before today's close of trading. I could use a little short covering rally here as the shorts throw in the towel on a day that, in their minds, should have sold off. I also thought we'd see some profit taking today but as soon as it appeared support was going to hold the buyers jumped back in.

Keene Little : 11/8/2006 3:18:18 PM

The current pullback still looks corrective and suggests we haven't seen the high yet.

Jeff Bailey : 11/8/2006 3:14:06 PM

03:00 Internals found at this Link

Keene Little : 11/8/2006 3:10:13 PM

A new high for ES now could be the last one before we get at least a deeper pullback. I've got Fibs pointing at 1394-1395.75 now for a potential high. The October 26th high of 1395.25 is in the middle of this range.

Jeff Bailey : 11/8/2006 3:02:27 PM

03:00 Market Watch found at this Link

Keene Little : 11/8/2006 3:00:49 PM

Could this be the last hurrah for the rally? When I look at the pattern for the banks I see that as a distinct possibility. As I had shown in last Thursday's and last night's Wrap, the banks look like they needed another leg up to finish the upside pattern. I had mentioned a Fib projection for the move up from June that would have two equal legs up at 401.39 but the top of its parallel up-channel is closer to 405. Link

Looking a little closer at the pattern, the leg up from August should be a 5-wave move for wave-C and the rally this week is the 5th wave. This 5th wave will equal the 1st wave at 403.67 which this rally is very close to achieving. This pattern suggests we could be topping here and now, at least for the banking index (which is one of my canaries for the broader market).

Jeff Bailey : 11/8/2006 2:54:52 PM

Fed's Moskow: Q3 Productivity Number Was 'Aberration'

Longer Term Productivity Trend Remains 2.5%

Pause In Rate Hikes Is Appropriate Policy

Pause In Rate Hikes Has `Served Us Well'

Jeff Bailey : 11/8/2006 2:47:21 PM

YM volume a little more brisk than yesterday's trade at WEEKLY R2.

Jeff Bailey : 11/8/2006 2:45:55 PM

Not sure I'd go with a short though ... too many trapped and looking for an exit.

Jeff Bailey : 11/8/2006 2:45:16 PM

Would exit a YM long 12,214 here ... TRIN gets the bounce back higher.

Jane Fox : 11/8/2006 2:43:24 PM

BOSTON (MarketWatch) -- Centex Corp. (CTX) Chief Executive Tim Eller speaking at a UBS-sponsored investor conference Wednesday said judging by previous housing downturns, it normally takes about two and a half years from the peak to the trough. "So we still have further to go" since most experts place the top of the housing boom in July 2005, the CEO said. He called the decline "supply-driven" because speculative investors, who were most active in coastal markets, tried to take profits when home affordability became squeezed. Also, potential buyers are having trouble selling their existing homes and are canceling, which is creating more inventory and drove price declines, Eller said. "In hindsight, we didn't take our foot off the gas pedal soon enough," he added.

Jeff Bailey : 11/8/2006 2:39:32 PM

YM 12,214 ... DR1 just ahead at 12,232

Jeff Bailey : 11/8/2006 2:38:39 PM

TRIN 1.34 +21.81% ... back to test DAILY S1.

Keene Little : 11/8/2006 2:35:07 PM

Assuming the market closes up today it will probably be dubbed the "Rumsfeld Rally" in today's media.

Jeff Bailey : 11/8/2006 2:34:46 PM

House Speaker Hastert: To Step Down From Leadership In Next Congress

DJ- U.S. House Speaker Dennis Hastert, R-Ill., announced Wednesday he won't seek a role in the GOP leadership when the 110th session of Congress convenes in January.

"The Republican leader in the 110th Congress will have the responsibility to emphasize conservative values and reform principles. I will not seek this role, but will support our leader to the best of my ability," Hastert said in a statement released by his press office.

He said he would instead "return to the full-time task of representing the people of the 14th district of Illinois."

Hastert won re-election to the House for an 11th term Tuesday, but growing dissatisfaction with the war in Iraq and scandals in Congress handed control of the House to Democrats.

Jeff Bailey : 11/8/2006 2:23:43 PM

The GOOG $480.25 +1.64% ... pinned at its WEEKLY R1.

Jane Fox : 11/8/2006 2:23:22 PM

SAN FRANCISCO (MarketWatch) -- Speaker Dennis Hastert said Wednesday he does not plan to seek the minority leader post when Democrats take control of the House of Representatives, according to a media report. Hastert voiced his plans in a conference call with fellow Republican lawmakers, the Associated Press reported, citing sources. Republicans lost control of the House in midterm elections. Rep. John Boehner of Ohio, the majority leader, is expected to run for the minority leader position, and Reps. Mike Pence of Indiana and Joe Barton of Texas have also indicated they may make seek leadership positions, the report said.

Jeff Bailey : 11/8/2006 2:22:51 PM

Interactive Week Internet (IIX.X) 197.50 +0.94% ... sticks its head above WEEKLY R2 (196.98)

Keene Little : 11/8/2006 2:21:35 PM

If we see a brief consolidation followed by another new high that new high will probably be followed by at least a deeper pullback so a retest of the October 26th high in SPX could be a good spot to take some money off the table if you got long this morning, and think about testing the short side. As usual though, the short side is the risky side.

Keene Little : 11/8/2006 2:19:13 PM

ES 1394 is the next upside target based on a Fib projection for the 2nd leg up today achieving 162% of the 1st leg up. That would be another new high but just shy of the 1395.25 October 26th high. The SPX high on that date was 1389.45.

Jeff Bailey : 11/8/2006 2:18:56 PM

YM 12,204

Keene Little : 11/8/2006 2:15:02 PM

ES and YM are punching right through their upside targets that were based on the expectation we'll just consolidate today. At this point it looks like new highs are on the way.

Jeff Bailey : 11/8/2006 2:10:46 PM

YM 12,183 ... back to check DAILY Pivot.

Marc Eckelberry : 11/8/2006 2:15:56 PM

Rumsfeld resignation is removing geo-political risk premium out of oil. Furthermore, energy policy will now be perceived as being less fossil fuel friendly. Watch QM 59.10 key support. The inventory data was bullish for oil thanks to diesel, but now we will see how much risk premium was attached with the war crowd. Maybe not much, as we have corrected a lot already. I am still bullish on oil if we hold 58.50/59. But the era of big oil being an integral part of our government might be nearing an end, and none too soon. At the very least, the rubber stamp days are over.

Jeff Bailey : 11/8/2006 2:04:41 PM

U.S. Oil Fund (USO) $52.65 +0.09% ... probes morning's lows. Notable reaction to Rumsfeld announcement.

Jeff Bailey : 11/8/2006 2:00:26 PM

RUT.X 769.59 +0.68% ... back above WEEKLY R1.

Keene Little : 11/8/2006 1:59:38 PM

Keep an eye on the levels where today's bounce will have two equal legs up--ES 1389.50 and YM 12198. Whether we get more than that (or less) it's hard to tell. We could instead stay within today's trading range and go more sideways before heading lower again.

Jeff Bailey : 11/8/2006 1:59:06 PM

Corning (GLW) $20.65 -1.99% ... after kiss of WEEKLY Pivot ($20.39)

Jeff Bailey : 11/8/2006 1:56:55 PM

Networking Index (NWX.X) 246.10 +0.81% ... gets a look above WEEKLY R2.

Jeff Bailey : 11/8/2006 1:55:34 PM

President Bush: Rumsfeld Out, Former CIA Director Gates In At DoD

DJ- Under fire, Defense Secretary Donald Rumsfeld is stepping down and will be replaced by former CIA director Robert Gates, President George W. Bush confirmed Wednesday.

"Secretary Rumsfeld and I have agreed that the time is ripe for new leadership at the Pentagon," Bush said in a statement at the start of a press conference in the White House.

Hours after losing the House of Representatives - and possibly the Senate - to the Democrats, Rumsfeld's resignation could help satisfy some calls for a shift in direction in Iraq.

"Sometimes it's necessary to have a fresh perspective," Bush said. He said the decision to nominate Gates for the Pentagon job was made prior to the mid-term elections.

Gates, currently the president of Texas A&M, met with the Bush recently at the president's ranch in Texas, Bush said.

"If confirmed by the Senate, Bob will bring more than 25 years of national security experience and a stellar reputation as an effective leader with sound judgment," Bush said.

Bush has expressed strong support for Rumsfeld throughout the Pentagon chief's contentious tenure. Asked about Rumsfeld last week, Bush said he wanted his embattled defense secretary to stay in place for the duration of his term. He said Rumsfeld and Vice President Dick Cheney "are doing fantastic jobs, and I strongly support them."

Calls for Rumsfeld's resignation picked up steam after the Democrats' big night Tuesday. Rep. Rahm Emanuel, D-Ill., and Sen. Joe Lieberman, elected as an independent in Connecticut, both said it's time for new leadership at the Pentagon.

"We need a new strategy," Emanuel said at a briefing. "We also have an obligation because this is a national security challenge for the entire country to work in a bipartisan fashion to come up with one."

The looming report on Iraq by a group led by former secretary of state James Baker and former congressman Lee Hamilton could provide a starting point for both parties to forge some sort of consensus on Iraq. The Democrats broadly called for change during the mid-term elections, but failed to unite around a coherent stance on the war.

Asked if Rumsfeld's resignation so shortly after the elections signals a new direction in Iraq, Bush said, "I would like our troops to come home, too, but I want it ... to come home with the victory. I can understand Americans saying `come home,' but I do not know if they said come home and leave behind an Iraq that could become a safe haven for al-Qaeda."

Keene Little : 11/8/2006 1:51:06 PM

We might see some buying now as relief that the press conference is over which I think went pretty well (conciliatory, humbling, wants to work with the Dems but maintain his principals, etc.). No major stumbles so that could relieve the market.

Jeff Bailey : 11/8/2006 1:46:08 PM

A lot of changes in the past 24-hours.

Jeff Bailey : 11/8/2006 1:45:32 PM

Former CIA Director Gates To Replace Rumsfeld

Keene Little : 11/8/2006 1:44:50 PM

It seems like the market might be waiting for the president's press conference to end (it's still going) to make sure no nasty surprises pop up. Whether we see selling or buying after that is hard to tell here. Looks like the press conference just ended as I'm typing so let's see if we get some movement now.

Jeff Bailey : 11/8/2006 1:38:56 PM

Cisco Systems (CSCO) $25.08 +0.96% ... creeps above WEEKLY R2. That's a new 52-weeker

Jeff Bailey : 11/8/2006 1:35:30 PM

01:07 Internals found at this Link

Jeff Bailey : 11/8/2006 1:32:03 PM

I think the $HUI.X 326.34 -0.73% ... has 325.00 in it.

Jeff Bailey : 11/8/2006 1:31:12 PM

Newmont Mining (NEM) $45.00 -1.50% ...

Keene Little : 11/8/2006 1:26:40 PM

At this point the uptrend lines are still holding but the market is certainly struggling here. A break of support could see some swift selling but so far support is still holding.

Jeff Bailey : 11/8/2006 1:21:36 PM

Coeur d'Alene Mines (CDE) $5.00 -1.75%

Jeff Bailey : 11/8/2006 1:21:00 PM

StreetTracks Gold (GLD) $61.45 -0.95% ... slips under its WEEKLY Pivot ($61.48)

Jane Fox : 11/8/2006 1:12:11 PM

At least the election is getting top billing over Britney Spears' divorce.

Jeff Bailey : 11/8/2006 1:09:30 PM

01:07 Market Watch found at this Link

Jeff Bailey : 11/8/2006 1:06:11 PM

YM 12,155

Jeff Bailey : 11/8/2006 1:02:46 PM

US Congress Finance Panels To Lose 3 Senior Republicans

DJ- Three senior Republicans who sit on financial services committees apparently lost their reelection bids Tuesday, with Sen. Rick Santorum of Pennsylvania and Rep. Jim Leach of Iowa falling, and Rep. Sue Kelly of New York projected to lose to her Democratic challenger.

But other endangered Republicans on these committees pulled off victories on a day when the tide heavily favored Democrats. Some of the more notable Republican survivors are Reps. Deborah Pryce of Ohio, Chris Shays of Connecticut, and Tom Feeney of Florida.

Jane Fox : 11/8/2006 1:01:12 PM

Oh my gosh it is so hard not to get political in here today!!!

Jeff Bailey : 11/8/2006 12:59:27 PM

At A Glance: Dems Have 50 Senate Seats; Tester Wins Montana

DJ- In the U.S. midterm elections, voters have given the Democratic Party a majority in the House. But control of the Senate hung in the balance with two races still undecided.

Democrats Take Control Of US House Of Representatives

Twelve years of Republican rule in the House of Representatives came to an end as Democratic challengers took advantage of anti-incumbent sentiment to win more than enough seats for a House majority.

Democrat Tester Wins US Senate Seat In Montana Democrat Jon Tester defeated Republican Sen. Conrad Burns in the Montana Senate race, the Associated Press reported Wednesday, bringing the Democrats one seat closer to possibly winning control of the U.S. Senate.

With 100% of precincts reporting, Tester, president of the Montana state Senate, led Burns by 49%-48%. The result means the Democrats will take control of the U.S. Senate if they win the tight Virginia Senate race. Democrat Jim Webb currently has a narrow lead over incumbent GOP Sen. George Allen.

Webb Maintains Small Lead In Virginia Senate Race Republican Sen. George Allen's political career hung by a thread on Tuesday, as Democrat Jim Webb claimed victory - though fewer than 8,000 votes separated the two and a recount was virtually certain.

"The votes are in and we won," Webb said, though there were still votes to count. With 99% of precincts reporting, Webb had 1,170,564 votes, or 49.6%, to Allen's 1,162,717, or 49.3%.

The race could determine whether Republicans retain control of the Senate.

Jane Fox : 11/8/2006 12:59:19 PM

They have taken a poll on the WSJ "Did the Democrates Win or the Republicans Lose?" 16% said Dems won and 84% said Rep lost. That was way I voted.

Keene Little : 11/8/2006 12:58:58 PM

Quick pullback is following but this should proceed higher again. If not then the selling should hit hard.

Keene Little : 11/8/2006 12:57:50 PM

Funny how that news about the Rumsfeld resignation happened just as the market was pulling back to support. Interesting how that happens time and again.

Jane Fox : 11/8/2006 12:56:49 PM

* NYSE advancers outnumber decliners 17 to 14
* Nasdaq advancers outnumber decliners 15 to 13

Jane Fox : 11/8/2006 12:56:26 PM

Odd timing on that resignation.

Jane Fox : 11/8/2006 12:56:06 PM

SAN FRANCISCO (MarketWatch) -- Defense Secretary Donald Rumsfeld is stepping down, the Associated Press reported Wednesday, citing Republican officials.

Keene Little : 11/8/2006 12:55:33 PM

I just heard Donald Rumsfeld is stepping down. No wonder the market is rallying.

Jeff Bailey : 11/8/2006 12:55:12 PM

YM 12,170

Jeff Bailey : 11/8/2006 12:54:20 PM

Alert! President Bush To Announce Secy Rumsfeld To Step Down

Keene Little : 11/8/2006 12:53:30 PM

Two equal legs up off this morning's low is now at ES 1389.50, two ticks above gap closure.

Jane Fox : 11/8/2006 12:52:32 PM

That was NOT a political statement!!!!

Jane Fox : 11/8/2006 12:52:16 PM

Has anyone noticed how quiet Bush as been the last few hours.

Jane Fox : 11/8/2006 12:51:00 PM

Oh I hope we don't have to endure another Florida 2000.

Keene Little : 11/8/2006 12:50:35 PM

ES is now getting a nice little bounce off support. A good spot for your stop on a long is now two ticks below that last low, so at 1381.75.

Jane Fox : 11/8/2006 12:50:24 PM

And just like that out of nowhere TICKS +1000

Jane Fox : 11/8/2006 12:49:35 PM

Looks like all eyes are now on Virginia Dem Jim Webb and Reb George Allen.

Keene Little : 11/8/2006 12:47:41 PM

It looks like control of the Senate is up to Virginia which will probably be weeks before we know the answer there.

Jane Fox : 11/8/2006 12:44:46 PM

Bears sry trying their darnest to grab those reins back aren't they. TRIN maybe falling but at 1.42 the bears don;t care which direction. I would not be long here. Link

Jeff Bailey : 11/8/2006 12:41:14 PM

YM 12,141

Jeff Bailey : 11/8/2006 12:41:04 PM

Democrat Tester Wins US Senate Seat In Montana

Keene Little : 11/8/2006 12:40:25 PM

YM's uptrend line from Friday is at 12145 so both YM and ES are now testing their uptrend lines (and slightly breaking as I type).

Jeff Bailey : 11/8/2006 12:35:57 PM

Polo Ralph Lauren 2Q Net Rises 24%, Raises View

DJ- Apparel maker posts net income of $137 million, or $1.28 a share. Net revenue rises 12% to $1.17 billion. Analysts expected $1.06 EPS on revenue of $1.16 billion. Firm raises year view to $3.50-$3.60 a share.

RL $73.69 +2.96% Link ...

Jeff Bailey : 11/8/2006 12:33:31 PM


DJ- Sirius posts 3Q loss of $162.9 million, or 12c a share, from year-ago loss of $180.4 million. Excluding items, firm loses 9c a share. Revenue more than doubles to $167.1 million. Analysts expected loss of 14c a share.

SIRI $4.12 +0.73% Link ...

Keene Little : 11/8/2006 12:32:53 PM

I see that that ES had pulled down this morning to its uptrend line drawn off the Friday afternoon lows. That line is currently at 1383, the same as the Sept 11-25 uptrend line. Long above, short below seems like the right play. Link

Jeff Bailey : 11/8/2006 12:30:23 PM


DJ- Baidu.com and eBay's EachNet sign multiyear cooperation agreement. Baidu will promote PayPal's Beibao as its preferred online payment method, while it will become the exclusive provider of text-based search advertising on eBay's China unit.

BIDU $96.39 +2.67% Link ...

EBAY $32.60 +0.15% Link ...

Jeff Bailey : 11/8/2006 12:25:20 PM


DJ- Mortgage-finance giant predicts it will cost $850 million to restate financial records prior to 2004 and an additional $200 million to prepare new financial statements for periods from 2004 to present. It also seeks to delay quarterly report.

FNM $61.65 +2.92% Link ...

Jeff Bailey : 11/8/2006 12:23:56 PM


DJ- Hertz drops Deutsche Bank from its IPO underwriting team after 'several e-mails' authored by a bank employee were 'ultimately forwarded by employees of that underwriter to approximately 175 institutional accounts.'

DB $125.96 -0.83% Link ...

Jeff Bailey : 11/8/2006 12:20:22 PM


DJ- Firm expects charges related to stock-option review "significantly greater" than prior estimate, and says historical financial statements for '94 to '05 and interim quarters through Sept. 30 should no longer be relied upon.

UNH $47.79 -3.59% Link ...

Tab Gilles : 11/8/2006 12:19:12 PM

Altria (MO) Follow up from 11/6 11:30 post. MO breaking out. Link

Although, I do not have the MO Jan call (MOAP) in my MM stock portfolio...I am tracking it.

MOAP currently trading $3.7/$3.8.

Jeff Bailey : 11/8/2006 12:15:49 PM

YM long stop alert 12,155

Keene Little : 11/8/2006 12:15:18 PM

ES 1383 is now the downside projection if we get two equal legs down. This also matches the uptrend line.

Jeff Bailey : 11/8/2006 12:13:32 PM

YM Long raise stop alert to 12,155

YM 12,163

Jeff Bailey : 11/8/2006 12:08:44 PM

Not a small cap in the bunch ... YM 12,164

Jeff Bailey : 11/8/2006 12:08:19 PM

RUT.X 768.18 +0.49% ... best levels of session and sticks its head back above WEEKLY R1

Keene Little : 11/8/2006 12:05:19 PM

The little sideways move here makes me think we'll get another drop back down. That's when I'd look for ES 1382.75 to hold (or not).

Jeff Bailey : 11/8/2006 11:50:37 AM

Dow Components at this Link

Keene Little : 11/8/2006 11:50:26 AM

If we're going to just bop around today without any clear direction look for moves where we get two equal legs and then a reversal. For example, if this drops a little further now, two equal legs down from this morning's high would be at ES 1382.75 (which would look like a retest of the last pullback). We could then see another push higher and two equal legs up from this morning's low would then be at 1390.

I'm just speculating at this point since I have no clue what's going to happen today. As long as the Sept 11-25 uptrend line holds (now close to the same 1382.75 as mentioned above) I'd stay on the long side. But another test of the 30-min 100/130-pma's at 1380-1381 is entirely possible.

Jane Fox : 11/8/2006 11:49:26 AM

WASHINGTON (MarketWatch) -- The close race between Democratic challenger James Webb and Republican Sen. George Allen in Virginia is not likely to be officially decided for several weeks, said George Mason University political science professor Toni-Michelle Travis. "I'm assuming we're going into a recount of the entire [Virginia Senate race] vote this year," Travis said in an interview. Virgina state law permits recounts when the margin is less than 1%. The state will pay for the recount if the final vote is less than half a percentage point. Webb leads Allen by 7,845 votes in the latest tally. Last year, the close Virginia's attorney general's race wasn't certified by a judicial panel until late December following an official recount, which only changed only 37 votes.

Keene Little : 11/8/2006 11:45:11 AM

Trading seems to be lethargic, as if the market is on hold. Considering the fact that we're waiting (and may wait for weeks) for word on what's going to happen with the Senate, the uncertainty could keep the market on hold, at least for today.

Jeff Bailey : 11/8/2006 11:44:33 AM

IBM $92.13 -0.34% ... slips to session low.

Jeff Bailey : 11/8/2006 11:39:45 AM

TRIN 1.58 ... DAILY R2 is 1.61 and TRIN has seen 1.62

Jeff Bailey : 11/8/2006 11:38:54 AM

YM long raise stop alert ... to 12,150

YM 12,168

Keene Little : 11/8/2006 11:35:16 AM

We have a bit of the opposite picture today than the past two days when looking at the a-d lines. The a-d volume is now flat and negative for the day but the a-d issues is up and climbing on the day. So we've got some buying going on in more issues but there's no volume behind it and in fact more volume in selling than buying. It doesn't make me bullish here so keep a tight stop on any long plays. Bulls need that buying volume to start kicking n.

Keene Little : 11/8/2006 11:32:14 AM

If you got long at ES 1382.50 I'd now use two ticks below the last pullback to 1384.25, so 1383.75, as your stop. The pullback held at today's uptrend line and a break back below that level could see this morning's lows at least tested (since the bounce off this morning's low is so far only a 3-wave bounce). A run to a new daily high could get some momentum behind it.

Jane Fox : 11/8/2006 11:29:52 AM

WASHINGTON (MarketWatch) -- The volume of mortgage applications at major U.S. banks rose sharply last week to a five-week high, the Mortgage Bankers Association reported Wednesday.

Overall, mortgage applications rose a seasonally adjusted 8.8% on a week-to-week basis, with refinance applications up 11% and purchase applications up 7.1%. The MBA data cover the week ended Nov. 3.

Mortgage applications are down 5% in the past year, reflecting weak conditions in the housing market. Applications are down about 30% from the most recent peak in June 2005.

Purchase loan applications are down 13.6% in the past year, in line with the decline in home sales

Jeff Bailey : 11/8/2006 11:29:05 AM

TRIN 1.54 +40% ... did kiss DAILY R2 1.616. If that's it for the morning selling, watch out if shorts.

Jeff Bailey : 11/8/2006 11:27:47 AM

11:00 Internals found at this Link

Keene Little : 11/8/2006 11:15:12 AM

Pulling back to test this morning's uptrend line right here. If this pullback holds then we should see new daily highs.

Jeff Bailey : 11/8/2006 11:10:00 AM

YM didn't get a 5-minute close above DAILY Pivot 12,179, so might see further weakness to 12,146-12,153. YM takes out DAILY Pivot, then look for pretty good short covering.

Jeff Bailey : 11/8/2006 11:08:28 AM

Crud ... didn't get that posted in time. Long YM here at 12,162

Jeff Bailey : 11/8/2006 11:08:04 AM

YM Long adjust entry alert ... look long 12,150

Jeff Bailey : 11/8/2006 11:03:07 AM

11:00 Market Watch found at this Link

Jeff Bailey : 11/8/2006 10:56:11 AM

Retabulation Of Montana's US Senate Vote Underway

Marc Eckelberry : 11/8/2006 10:54:53 AM

This election is bullish for the dollar. Watch 85.52, key level.

Jeff Bailey : 11/8/2006 10:50:20 AM

YM Long entry setup alert with YM 12,180, look to go long on a trade at 12,162, stop 12,145, target 12,230

Jeff Bailey : 11/8/2006 10:44:04 AM

BIX.X 401.62 +0.62% ... busts the move. All-time high!

Keene Little : 11/8/2006 10:41:08 AM

ES 1382.50 held on that pullback. Now if we get two legs up off this morning's low watch for 1388 to be potential resistance. But gap closure at 1389 is just above that. It would be a good spot to try a reversal to the short side.

Jane Fox : 11/8/2006 10:40:39 AM

TICKS +1000!

Jane Fox : 11/8/2006 10:40:15 AM

Even though the VIX is confirming ES's new daily highs I cannot bring myself to buy this market because of the bearish TRIN and AD volume.

Marc Eckelberry : 11/8/2006 10:40:58 AM

The biggest danger to our economy has been spending (anything else is just noise) and hopefully we are done with that or at least slowing it down as pork project ceased getting an instant green light. I expect a rally out of all this if oil can hold back.

Jane Fox : 11/8/2006 10:39:20 AM

Rescue Team is back in town TICKs +800

Jeff Bailey : 11/8/2006 10:33:26 AM

U.S. Oil Fund (USO) $52.87 +0.51% ... gets a "pop" from $52.70.

WEEKLY Pivot Levels ... $49.76, $51.17, Piv= $52.23, $53.63, $54.69.

Jane Fox : 11/8/2006 10:32:40 AM

* U.S. crude supply up 400,000 brls last week: Energy Dept.
* U.S. distillate supply down 2.7 mln brls: Energy Dept.
* U.S. gasoline supply down 600,000 brls: Energy Dept.

Marc Eckelberry : 11/8/2006 10:32:37 AM

It's all nonsense in the end. Democrats are a center party now. No need to get hysterical, or shiver like the lunatics on Fox news.

Jeff Bailey : 11/8/2006 10:30:35 AM

Reuters' Global Indices Link

Jeff Bailey : 11/8/2006 10:29:37 AM

That seems to be the theme among analysts, and I can relate to the "protectionist" worry that comes from Democrats taking the House, perhaps the Senate (still up for grabs).

Several months ago, when Senator Kerry was grilling Mr. Greenspan, stocks fell sharply intra-day when Mr. Kerry suggested tariffs on China imports.

Marc Eckelberry : 11/8/2006 10:29:12 AM

It seems like many folds on Wall street are not in tune with the folks on Main street. Nevertheless, it makes little difference who is in power other than the very welcome news of gridlock in order to reign in the spending orgies of the past few years. Watch the dollar. If it bids, that is the thinking. COMP 2374/2375 is still what bulls need back. Watch QM 59.40 after inventories.

Keene Little : 11/8/2006 10:28:42 AM

Also, in its little pullback from this morning's bounce, two equal legs down is at the same 1382.50.

Keene Little : 11/8/2006 10:28:28 AM

ES spiked below its Sept 11-25 uptrend line at 1382.50 but is obviously back above it now. I'll be watching to see if it continues to hold above it since it could make for an opportunity to test the long side.

Jane Fox : 11/8/2006 10:16:49 AM

Opps AD volume to new daily lows again so don't expect too much more upside.

Jane Fox : 11/8/2006 10:09:13 AM

AD line hit a low of -1286 this morning but is now almost to 0.

Jeff Bailey : 11/8/2006 10:08:35 AM

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

Jane Fox : 11/8/2006 10:07:57 AM

AD volume is still well below 0 but it is climbing so the bears are getting weaker but not out of the picture yet.

Keene Little : 11/8/2006 10:07:01 AM

NDX and RUT are ticking into the green now. Not a bad recovery. Now we'll see if it holds.

Jane Fox : 11/8/2006 10:06:48 AM

There is no clear direction and the best trade so far is no trade. TRIN is very bearish and bulls need to take heed of this. VIX is falling and making new daily lows and the bears need to take heed of this.

Jane Fox : 11/8/2006 10:03:26 AM

TICKS +800

Jane Fox : 11/8/2006 10:02:00 AM

For the last couple of days you needed to keep your eye on the AD volume but today you need to watch the VIX.

Jeff Bailey : 11/8/2006 10:01:50 AM

10:00 Market Watch found at this Link

Jane Fox : 11/8/2006 9:55:36 AM

These should have you scratching your head. Link

Jane Fox : 11/8/2006 9:54:02 AM

I don't think this bullishness will hold up much longer. I believe the bears will prevail today.

Jane Fox : 11/8/2006 9:52:37 AM

TICKS have hit a high of +785 so far and are climbing again. Not time to short yet.

Jeff Bailey : 11/8/2006 9:49:55 AM

Not showing any trade having taken place in the Regional Bank HOLDRs (AMEX:RKH) $157.70

Jane Fox : 11/8/2006 9:49:50 AM

AD Volume falling and TRIN climbing is bearish but I need the VIX to join in for me get short.

Jane Fox : 11/8/2006 9:48:50 AM

HMMM Maybe the bears do have a chance today. Look at the AD volume making new daily lows. Link

Jeff Bailey : 11/8/2006 9:47:29 AM

S&P Banks Index (BIX.X) 399.99 +0.22% Link ... has been a point of psychological, now technical resistance.

Jane Fox : 11/8/2006 9:47:07 AM

How silly of me to think the bears could keep the ball today. Buuuutttt TRIN is 1.45 and climbing although the VIX is making new daily lows and falling. Time to sit on your hands.

Keene Little : 11/8/2006 9:46:50 AM

This is why I'm letting the dust settle before I try to trade this market. It's been difficult enough without a lot of emotion and confusion thrown in this morning.

Keene Little : 11/8/2006 9:45:33 AM

Well I see we still have a rescue team out there. Buy programs hitting all indices at once. It may be an effort to spike the market up in order to sell into it though.

Jane Fox : 11/8/2006 9:38:14 AM

So far we have a "Get short and stay short" kind of day.

Keene Little : 11/8/2006 9:37:12 AM

If 1380 doesn't hold, a 50% retracement of this week's rally is at ES 1379.25.

Jane Fox : 11/8/2006 9:35:23 AM

VIX well above its PDH.

Jane Fox : 11/8/2006 9:34:31 AM

AD line is a very bearish -1193 and AD volume below 0 and falling. Bears have the ball.

Keene Little : 11/8/2006 9:33:44 AM

The 30-min 100/130 moving averages for ES are at 1380-1380.50 so this is another potential support area.

Jane Fox : 11/8/2006 9:28:06 AM

Natural GAs tagged its PDH overnight but was not able to break through.

Crude tagged its PDL overnight and was not able to break through.

Gold really soldoff overnight. The markets are still in a state of confusion and I think this selloff is a result of that confusion.

Bond market is just as confused as the others.

Can you say gridlock. Link

Jane Fox : 11/8/2006 9:23:54 AM

NEW YORK (MarketWatch) -- The dollar traded little changed against major currencies in tight ranges early Wednesday, showing a muted reaction to the results of the U.S. mid-term elections.

The elections didn't provide any clear direction for the dollar overnight. Democrats took control of the House of Representatives with a clear majority, as widely expected. The Senate looks very evenly divided. The Democrats weren't widely expected to take over the Senate.

"The greenback is confined to yesterday's ranges and the modesty of the moves suggests that there has not been much of a reaction" to the results of the election, which "were well within expectations," said Marc Chandler, global head of currency strategy at Brown Brothers Harriman.

Jane Fox : 11/8/2006 9:19:35 AM

AS you can see only ES has broken its PDL and then not by much. However, the lower lows and highs are bearish and I suspect the internals will open telling me the bears have the ball. How long they can retain it remains to be seen but the market may have to digest what a Democratic House will mean before it makes any kind of move. Remember if there is indecision in the market the sellers are usually able to overcome the buyers. Link

Keene Little : 11/8/2006 9:12:21 AM

The market got what it wanted (gridlock) and is still selling the news. It was a pretty obvious setup coming into the elections. I would expect some volatility this morning so be cautious about any early moves. A 38% retracement for YM is at 12133 (not yet hit in pre-market) and for ES it's at 1282.50 (pre-market low is 1281).

The uptrend line for ES from Sept 11th through Sept 25th, which ES had broken last week, retested and then recovered above it on Monday, is now at 1282 which is where ES is currently trading so perhaps we'll get an early bounce.

Jane Fox : 11/8/2006 9:11:23 AM

Dateline WSJ - Democrats seized control of the House of Representatives in a bitter midterm election and came tantalizingly close to taking the Senate as vote counts in close races continued into this morning.

Democrats went into the election needing six seats to win an effective majority in the Senate. They won three -- Ohio, Pennsylvania and Rhode Island -- with relative ease. Then, early Wednesday morning, they picked up a seat in Missouri, as state auditor Claire McCaskill beat Republican Sen. Jim Talent.

Still undecided were Senate races in Montana and Virginia, both of which Democrats would have to win in order to control the chamber. They were leading in both contests, but in Montana, election officials in Yellowstone County said voting-machine problems would delay a final report until at least 7 a.m. Eastern time. And the outcome of the Virginia race is in limbo at least until absentee votes are counted on Wednesday and possibly longer -- for at least a month -- if the tally is subject to a recount.

In the House, Democrats won more than two dozen seats by early Wednesday morning, setting up a sharply divided government and elevating House Democratic Leader Nancy Pelosi (D., Calif.) to be the first female Speaker of the House. "Today we have made history. Now let us make progress," Ms. Pelosi said at a rally early Wednesday.

Democrats picked up Republican-held House seats in red states in the nation's heartland -- four in Indiana and Kentucky alone -- and at least eight in the Northeast, as voters registered their discontent after six years of a Republican-led government and their concerns about the Iraq war. It was a bad day for Republican moderates, as Democrats defeated lawmakers such as Sen. Lincoln Chafee of Rhode Island, Rep. Nancy Johnson of Connecticut and -- in a surprise upset -- 15-term Iowa Rep. Jim Leach.

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