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Keene Little : 12/13/2006 11:32:03 PM

Thursday's pivot tables: Link and Link

OI Technical Staff : 12/13/2006 9:59:59 PM

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Jeff Bailey : 12/13/2006 9:11:15 PM

Excellent weekly report by EIA this week (see 08:59:21) ahead of OPEC's meeting and historical bullishness for Oil sector. The "raw supply data" also suggests that OPEC should stand pat in my opinion.

Jeff Bailey : 12/13/2006 9:05:00 PM

EIA Weekly Crude Oil, Gasoline, Distillate, ULS Diesel, Jet Fuel, Heating Oil Table at this Link

Note: Year Ago ULS Diesel exaggerated due to EPA's mandate to Ultra Low Sulfur Diesel this summer.

Jeff Bailey : 12/13/2006 8:59:21 PM

EIA's This Week In Petroleum Link

Jeff Bailey : 12/13/2006 7:10:03 PM

Daily/Weekly/Monthly Index Pivot Matrix found at this Link

Jeff Bailey : 12/13/2006 6:30:15 PM

YM Pivot Matrix for tomorrow at this Link

Jeff Bailey : 12/13/2006 6:13:25 PM

Today's and Tuesday's Put/Call Ratios at this Link

Jeff Bailey : 12/13/2006 6:02:47 PM

Keene ... could be. NYX $97.24 -1.02% and each run at $100.00 also gets stalled.

Jeff Bailey : 12/13/2006 6:01:19 PM

Democratic Senator Tim Johnson of South Dakota Suffers Possible Stroke; Illness Could Cast Doubt on Democratic Control of Senate

MarketWatch story Link

Keene Little : 12/13/2006 5:54:54 PM

Jeff, I got out of my SPY 142 calls at breakeven on Friday. I didn't like the price action and used the bounce to just exit before the weekend took too much time premium. I got in and out at 0.70 and today's close was 0.30 so it was the right decision, at least as of today. I'm not convinced it's going to do any better tomorrow.

Jeff Bailey : 12/13/2006 5:51:25 PM

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

Jeff Bailey : 12/13/2006 5:38:48 PM

Closing Internals found at this Link

NASDAQ NH/NL Ratio Chart at this Link ... where at the conclusion of today's trade, the "f"ive day ratio reverses 3-boxes lower (from 80.00%)

Jeff Bailey : 12/13/2006 5:25:31 PM

Keene! You still long those SPY $142 Calls? It isn't over until its over!

Jeff Bailey : 12/13/2006 5:23:19 PM

SPX NH/NL 50:0 and has its 5-day NH/NL ratio at 100%. That's incredible! 10-day NH/NL ratio is 99.2%

Jeff Bailey : 12/13/2006 5:02:53 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 12/13/2006 4:41:00 PM

I received a couple of questions from long-time subscribers about "tax loss sell bounce" candidates for January.

I haven't been looking all that much at this point.

Ford (F) $6.88 -2.96% Link has been a volume leader and looks terrible since mutual fund's closed their books. 12/30/05 close was $7.72, so stock is down from last year. Stock looked terrible into 12/30/05 close too, then got a pop close to $9.00 first couple of weeks in January.

Jeff Bailey : 12/13/2006 4:17:07 PM

Baker Hughes (BHI) $74.21 +3.14% ... does muster a closer above its 200-day SMA ($74.00) on 5.2 million shares. That's brisk, but not heavy considering average daily volume has been 4.9 last three months.

Jeff Bailey : 12/13/2006 4:11:21 PM

YM 12,419 ... I usually don't trade the YM long/short or short/long in the same session, but correlations in the Pivot Matrix suggested more volatile trade than we ended up with.

Reason to have been long before noon in my opinion was YM backfilled the morning gap, but didn't test DAILY Pivot, and TRIN had pegged its DAILY S2 at the open, giving observation YM had DAILY R2 in it before the close.

When the "pop" at bull entry failed to gather strength, with a "trend session higher to the close," the only trade left in my opinion was to look short, get a move below WEEKLY Pivot to then have a reversal session take hold, and some gravitation toward DIA "Max Pain".

Keene Little : 12/13/2006 4:08:43 PM

It's a tough call right here for what to expect tomorrow morning. I'd have to say I'm leaning towards another leg down. We could see a small jump higher first but the way this chopped lower today tells me it could be just part of a slightly larger consolidation before proceeding lower. But as I said, tough call.

Keene Little : 12/13/2006 3:57:35 PM

Golf clap for the Boyz and their ability to hold the market at the flat line. Let's face it, the stock market hasn't exactly gotten what it wanted to hear in the past week and yet no sell off. I'm sure a little Fed money sprinkled like fairy dust on the market is helping some as well.

Jane Fox : 12/13/2006 3:55:45 PM

Economic reports for tomorrow.

8:30a.m. Initial Jobless Claims. For Dec 9 Wk. Expected: -4K. Previous: -34K.

8:30a.m. Nov Import Prices. Expected: -0.1%. Previous: -2.0%.

Jeff Bailey : 12/13/2006 3:54:09 PM

Darned tempted to make a play on "Trader Dan's" call idea from last week.

Jeff Bailey : 12/13/2006 3:52:55 PM

VIX 10.27 ... sure looks like it has a 10.00 in it again.

Jeff Bailey : 12/13/2006 3:44:45 PM

"Bad tick" in RHT $16.68 +1.45% ... at $14.60.

Keene Little : 12/13/2006 3:42:55 PM

That bullish TRIN didn't last long--right back to .99 as soon as that sell program hit. Continued choppy price action here.

Jeff Bailey : 12/13/2006 3:40:43 PM

Sell Program Premium ... YM 12,418 : SPY $141.89

Jeff Bailey : 12/13/2006 3:39:38 PM

where was that (TRINQ) when I needed it on the bull side?

Jeff Bailey : 12/13/2006 3:39:18 PM

TRINQ 0.85 ...

Jeff Bailey : 12/13/2006 3:39:02 PM

TRIN 0.98

Jeff Bailey : 12/13/2006 3:38:50 PM

YM short stop alert 12,420

Jeff Bailey : 12/13/2006 3:30:37 PM

In order to have gotten initial bear target of 12,355, pretty much had to have been below WEEKLY Pivot by 03:00

Jeff Bailey : 12/13/2006 3:28:38 PM

TRIN 0.97

Jeff Bailey : 12/13/2006 3:28:20 PM

YM short stop/target adjustment ... with YM 12,404 ... lower stop to 12,420 and raise target to 12,387.

Jeff Bailey : 12/13/2006 3:24:04 PM

YM 12,405

TRIN 0.99

Jeff Bailey : 12/13/2006 3:16:22 PM

03:00 Internals found at this Link

Jane Fox : 12/13/2006 3:06:34 PM

WASHINGTON (MarketWatch) -- In a move that may help attract foreign capital to U.S. markets, U.S. regulators moved on Wednesday to make it easier for foreign firms to deregister themselves with the Securities and Exchange Commission. The proposal says a company with less than 5% of its trading volume occurring on U.S. markets can leave if it wants to. Previously, companies had to meet requirements about the percentage of U.S. holders as well as trading volume. Foreign firms have begun to seek non-U.S. markets to list on in light of tough U.S. accounting rules.

Keene Little : 12/13/2006 3:06:07 PM

This is the little sideways triangle idea I'm thinking is playing out today. It calls for another leg down after it finishes which should be at the next bounce. For ES the bounce should finish short of the last high at 1426.50 and then roll over and head for new lows. A rally above 1428 would negate this pattern. Link

Jane Fox : 12/13/2006 3:04:17 PM

10-year Treasury falls 22/32 to 100-12/32; yield 4.577%

Jeff Bailey : 12/13/2006 3:02:30 PM

03:00 Market Watch found at this Link

Jeff Bailey : 12/13/2006 2:59:01 PM

TRINQ 1.30

Jeff Bailey : 12/13/2006 2:58:52 PM

TRIN 1.09

Jeff Bailey : 12/13/2006 2:58:38 PM

Sell Program Premium ... YM 12,400 : SPY $141.64

Jane Fox : 12/13/2006 2:53:58 PM

BOSTON (MarketWatch) -- Money-market mutual funds posted inflows of $21.3 billion for the week ended Dec. 12 to push total assets to an all-time high of $2.333 trillion, according to Money Fund Report, a service of iMoneyNet. The previous record of $2.326 trillion was set roughly four years ago. Taxable funds in the latest week added $20.8 billion to $1.963 trillion, as average yields held steady at 4.74% for the third consecutive week, iMoneyNet reported Wednesday afternoon. Meanwhile, tax-free funds gained $465.8 million to reach $369.77 billion as yields slipped to 2.88% from 2.96% the previous week.

Jeff Bailey : 12/13/2006 2:41:34 PM

Sell Program Premium ... YM 12,406 : SPY $141.70

Keene Little : 12/13/2006 2:37:11 PM

The bears see "rally it, sell into it" and the bulls see "sell it, buy the dip". I see chop. If we're building a little sideways triangle today, which would be a bearish continuation pattern for another leg down, watch for support near ES 1423.75 (missed by a tick), a bounce back up to another lower high and then the start of the next leg down.

The next leg down, if it's coming, may not happen until tomorrow and the downside projection for it is just above yesterday's low, which is potential support at the bottom of an even larger sideways triangle (that is potentially bullish).

Jeff Bailey : 12/13/2006 2:32:14 PM

YM short entry alert here at 12,404, stop 12,427 , target 12,355

Jeff Bailey : 12/13/2006 2:30:52 PM

TRIN 1.07

Jeff Bailey : 12/13/2006 2:30:42 PM

Sell Program Premium ... YM 12,403 : SPY $141.67

Jeff Bailey : 12/13/2006 2:29:35 PM

Sunoco To Grow Non-Refining Earnings to $400M by 2009

DJ- Sunoco Inc. chief financial officer Tom Hofmann outlined Wednesday the company's goal to grow the annual earnings of its non-refining businesses to $400 million by 2009.

Hofmann told analysts during a strategy briefing that those earnings would be driven largely by improved margins in Sunoco's chemicals business and the development of new coke-making facilities. Coke is used in the production of blast furnace steel. "The goal for all of these busineses is to get to $400 million by 2009," he said.

"The key drivers here will be chemical earnings and new coke plants," Hofmann said.

For the first nine months of 2006, Sunoco's non-refining businesses - retail marketing, chemicals, logistics and coke - reported operating income of $172 million.

Sunoco's wholly owned business SunCoke, currently operates metallurgical coke plants in Vansant, Virginia; East Chicago, Indiana; and Haverhill, Ohio. Hofmann foreshadowed the purchase of an additional 19% stake in a new 1.6 million tonnes-a-year cokemaking facility in Brazil which is expected to move into production in the first quarter of next year. Ownership of the project is currently shared by SunCoke and its off-take partners, with SunCoke having an initial 1% interest and an option to purchase, at net book value, an additional 19% stake, according to the company's website. "That plant, we will have a 20% interest in, on a go-forward basis," Hofmann told analysts.

He said the goal for Sunoco's coke business is to generate annual earnings of $150 million by 2009 but he said more plants are required to meet that target.

Sunoco chief executive Jack Drosdick said the company is continuing to work with parties regarding new coke projects and it has moved "a lot closer with a larger number of companies to signed agreements".

"It has happened a lot more slowly than we would have thought," he said.

SUN $67.44 +1.52% Link

Jane Fox : 12/13/2006 2:24:08 PM

SAN FRANCISCO (MarketWatch) -- Darden Restaurants Inc. (DRI) said Wednesday it plans to switch to trans fat-free frying oil at all of its 1,267 Red Lobster and Olive Garden restaurants in North America by the end of November 2007. The company said more than 100 Red Lobster and Olive Garden restaurants are already using the new canola oils. The move is the result of 18 months of testing and consumer feedback, Orlando, Fla.-based Darden said. Darden shares rose 2.9% to $41.07 in Wednesday afternoon trade.

Jeff Bailey : 12/13/2006 2:08:25 PM

Russia Blasts US For Raising Belarus Human Rights At UN

DJ- Russia's Foreign Ministry on Wednesday angrily criticized the U.S. for raising the plight of an opposition leader in Belarus in the U.N. Security Council, saying the move violated U.N. procedures.

The ministry said in a statement that the U.S. move represented an attempt by Washington to "turn the Council into the platform for discussing issues dictated by U.S. home policy interests."

It added that the discussion of human rights issues was a prerogative of other U.N. structures and condemned what it called "the violation of the existing Security Council procedures" by the United States.

Belarus, led by authoritarian President Alexander Lukashenko who is dubbed "Europe's last dictator" in the West, isn't on the Council's agenda. Russia's U.N. envoy strongly objected Tuesday when the United States brought up the 54-day hunger strike of jailed former Belarusian opposition presidential candidate, Alexander Kozulin.

Angered by the U.S. move, Russia demanded to postpone a key round of Council negotiations on a European draft Security Council resolution on Iran.

Kozulin, who ended his hunger strike Tuesday, has been jailed since March when he led a protest march following presidential elections in which he was one of three candidates challenging Lukashenko. Kozulin had been on hunger strike to protest his sentencing in June to five and a half years in prison for organizing the unsanctioned protest.

Lukashenko has ruled Belarus since 1994, quashing dissent and maintaining power through elections that have been dismissed by critics abroad and at home as illegitimate. Russia has been Belarus' main sponsor and ally.

Keene Little : 12/13/2006 2:05:41 PM

If by chance this rolls over again to a new daily low then the EW pattern for today's drop suggests we'll get a fast sell off. Until that happens we're just chopping around today.

Jeff Bailey : 12/13/2006 2:04:11 PM

YM 12,414

Jeff Bailey : 12/13/2006 2:03:55 PM

S&P Insurance (IUX.X) 389.79 +0.06% ... about 3 points above its 12/06/06 intra-day high.

Keene Little : 12/13/2006 2:03:01 PM

They're doing a good job at pinning the market near the flat line. Even a-d volume just climbed back up to the flat line.

Jeff Bailey : 12/13/2006 2:02:32 PM

Berkshire Hathaway (BRK.a) $110,000.00 +1.10% ... again!

Jeff Bailey : 12/13/2006 1:55:53 PM

TRIN 1.00

TRINQ 1.00

YM 12,405

Keene Little : 12/13/2006 1:46:47 PM

Stick save for NQ here? The drop stopped at the daily low which was also a retest of its broken downtrend line from yesterday's high. Needless to say a roll back over to a new low could see some accleration lower.

Jeff Bailey : 12/13/2006 1:41:59 PM

TRINQ 1.31

Jeff Bailey : 12/13/2006 1:41:48 PM

TRIN 0.99

Jeff Bailey : 12/13/2006 1:41:02 PM

Sell Program Premium ... YM 12,399 : SPY $141.66

Keene Little : 12/13/2006 1:40:14 PM

I feel my fuzzy little bull horns loosening. One more swipe by the bears (NQ to a new daily low) and they're gone.

Keene Little : 12/13/2006 1:37:23 PM

The a-d volume just went red for the first time today.

Keene Little : 12/13/2006 1:36:06 PM

The YM pullback is looking bearish, especially if it breaks to a new daily low which it's threatening to do. I now have the stop on my YM short at 12429 (3 ticks above the last bounce) and the stop on my NQ long at 1795 (2 ticks to a new low). May the best index win.

Keene Little : 12/13/2006 1:33:13 PM

Somewhat oddly the a-d volume has stayed in a flat line just barely above zero all day. It looks like a perfect balance of buying and selling all day and could be another indication of distribution. If it is distribution then my hat's off to the Boyz--they're very good at what they do. Keep the market stable, always with a hint of a coming rally so as to keep the sheeple buying up their inventory. If they can manage to do this into the end of the month then I suspect January will not be so nice to the bulls.

Jane Fox : 12/13/2006 2:21:47 PM

Ex-Enron CEO Jeffrey Skilling reports to prison: AP

Jeff Bailey : 12/13/2006 1:20:22 PM

01:00 Internals found at this Link

Jane Fox : 12/13/2006 1:20:12 PM

* NYSE most active stocks: F GE PFE DCT AMD
* Nasdaq most active stocks: QQQQ SUNW SIRI INTC MSFT

Keene Little : 12/13/2006 1:17:38 PM

Bond yields getting a good spike up today--up nearly 1.9%. This will have a cooling effect on the bounce in housing and the economy. The "what-me-worry?" stock market keeps trying to look around the elephant in the living room and refuses to take notice of it. It will notice it soon and the only question in my mind is when.

Jeff Bailey : 12/13/2006 1:14:42 PM

NH/NL readings alert #2! ... Now back to 268:11 and 97:53 ... disregard my 01:11:15 post.

Jeff Bailey : 12/13/2006 1:12:15 PM

YM 12,420 ... probably has trouble on anything close to 12,445

Keene Little : 12/13/2006 1:11:31 PM

Continue to keep in mind that spike moves may be nothing more than opex related activities. That's why I'm trying to identify upper and lower resistance and support rather than trade the potential chop in between. A break above the bounce near 12:00 PM would be bullish. A break below the last dip near 12:45 PM would be bearish. In between is chop.

Jeff Bailey : 12/13/2006 1:11:15 PM

NH/NL readings alert! ... there must have been a data feed error. My rather reliable source of NH/NL now showing NYSE 193:6 and NASDAQ 62:28.

Jane Fox : 12/13/2006 1:06:24 PM

CHICAGO (MarketWatch) -- U.S. homeowners had a harder time keeping up with their mortgage payments in the third quarter, the Mortgage Bankers Association said Wednesday, with the delinquency rate rising to 4.67% from 4.39% in the second quarter. A year ago, 4.44% of mortgage holders were 90 days or more past due on their loans. The foreclosure rate inched higher in the third quarter, with 1.05% of mortgages in the foreclosure process vs. 0.99% in the second quarter, the MBA said. While delinquency rates on all types of loans rose in the third quarter, it was the subprime category -- loans made to less creditworthy borrowers, that shot up the most to 12.56% from 10.76% a year ago.

Jane Fox : 12/13/2006 1:06:19 PM

You know Keene I am growing those horns as well.

Jeff Bailey : 12/13/2006 1:02:28 PM

01:00 Market Watch found at this Link

Keene Little : 12/13/2006 1:00:33 PM

So, if long NQ I'd use the last low at 1795.50 as a stop level. It's currently attempting to break its downtrend line from yesterday's high, at 1800. A break above and pullback to retest would be another opportunity to get long. A failure here and a drop to a new low and my little fuzzy horns fall to the ground.

Keene Little : 12/13/2006 12:56:41 PM

Just baby ones Jeff, still have the fuzz on them. I'm sure a bear will bite them off.

Jeff Bailey : 12/13/2006 12:54:25 PM

Keene growing some horns lately?

Jeff Bailey : 12/13/2006 12:53:56 PM

YM 12,418

TRIN 0.98

Keene Little : 12/13/2006 12:53:50 PM

A little hedge play here.

Keene Little : 12/13/2006 12:53:08 PM

NQ is also showing some short term bullish divergences. Seeing this has got me thinking I just might have to try a long on that one.

Keene Little : 12/13/2006 12:50:45 PM

The other significance about where NDX is currently pulling back to is that it's the uptrend line from October 2002 through April 2005. This uptrend line was recovered in early November and each pullback since the November high has been finding support at this line. To say it's an important trend line is an understatement.

Jeff Bailey : 12/13/2006 12:49:57 PM

YM 12,415

TRIN 1.01

Jeff Bailey : 12/13/2006 12:49:26 PM

Might not be any short still around .... ;)

Keene Little : 12/13/2006 12:48:51 PM

AT 1795 NQ is testing the bottom of the sideways triangle that I showed earlier for NDX (10:20) so this is an important test for NQ here. Watch for a head fake break and recovery which would be bullish. A drop below that stays below 1795 would be bearish.

Jeff Bailey : 12/13/2006 12:46:23 PM

YM 12,410

TRIN 0.99

Keene Little : 12/13/2006 12:46:10 PM

If you shorted the bounce and want to more aggressively chase this lower and pull your stop down some, use the downtrend line from this morning's high. I'd keep the stop at least 5 YM and 0.50 ES points above it. The risk is a head fake spike above the line just to nail the stops so that's your risk. Right now, using the trend lines, stops can be lowered to YM 12430 and ES 1427.75.

Jeff Bailey : 12/13/2006 12:46:08 PM

Shorts don't seem nearly as eager to jump of late do they?

Jeff Bailey : 12/13/2006 12:42:50 PM

YM 12,411

TRIN 1.00

Jeff Bailey : 12/13/2006 12:41:47 PM

TRIN 0.99

Jeff Bailey : 12/13/2006 12:41:15 PM

YM long stop alert 12,410

Jeff Bailey : 12/13/2006 12:36:46 PM

BIX.X 403.49 +0.20% ... back for another look at WEEKLY R1/DAILY R1 overlap

Jeff Bailey : 12/13/2006 12:35:26 PM

Feeling some pressure building here.

Jeff Bailey : 12/13/2006 12:35:04 PM


Jeff Bailey : 12/13/2006 12:34:26 PM

TRINQ 1.40

Jeff Bailey : 12/13/2006 12:34:01 PM

TRIN 1.00

YM 12,413

Jeff Bailey : 12/13/2006 12:24:04 PM

No YM help from its 4 and 5-lettered friends.

Keene Little : 12/13/2006 12:23:51 PM

Like minds on that uptrend line Jeff.

Keene Little : 12/13/2006 12:23:29 PM

We're seeing some support at the moment at the uptrend lines from yesterday's low through this morning's low. A continuation lower should see new daily lows next. If instead we get another bounce back up then I'd be thinking sideways consolidation today.

Jeff Bailey : 12/13/2006 12:20:33 PM

YM right at short-term upward trend (from yesterday's low, to this morning's pullback low of 12,397

Jeff Bailey : 12/13/2006 12:19:23 PM

TRIN 0.98

Jeff Bailey : 12/13/2006 12:19:15 PM

YM needs buyers here 12,416

Keene Little : 12/13/2006 12:09:58 PM

It looks like the bounce may have topped out and we're starting the next leg down. Either that or we'll just chop sideways for the rest of the day (oh joy if that happens). If we get a break to a new daily low then we'll know the 2nd leg down is happening and I'll get some Fib projections to watch for support. A short here is a scalp trade until we get a better sense of the longer term pattern. I'd pull my stop down now to just above the bounce high--no sense taking any more risk than that now.

Jeff Bailey : 12/13/2006 12:09:29 PM

Amerigroup (AGP) $36.05 +1.66% ... back to Illinois court ruling.

Jeff Bailey : 12/13/2006 12:06:53 PM

YM Long adjust stop alert ... to 12,410

YM 12,418

Jeff Bailey : 12/13/2006 12:00:50 PM

TRIN 1.00

Jeff Bailey : 12/13/2006 12:00:28 PM

YM Long entry alert 12,432

Jeff Bailey : 12/13/2006 11:59:35 AM

200-day SMA alert .... Baker Hughes (BHI) $74.00 +2.85% ...

Jeff Bailey : 12/13/2006 11:58:54 AM

YM/ES trader will still monitor TRINQ as "from weakness can come strength"

Jeff Bailey : 12/13/2006 11:57:03 AM

TRINQ 1.11 ... DAILY Pivot Levels are -0.03, 0.65, Piv= 1.09, 1.77, 2.21.

Jeff Bailey : 12/13/2006 11:49:24 AM

TRIN 1.01 ... YM 12,425

Jeff Bailey : 12/13/2006 11:47:32 AM

TRIN 1.00 ... did peg DAILY S2 this morning. Me thinks YM DAILY R2 potential.

Jeff Bailey : 12/13/2006 11:44:44 AM

YM07H long setup alert go long a trade at 12,432 , stop goes 12,414 , target 12,470.

YM 12,423

Jane Fox : 12/13/2006 11:42:20 AM

Bonds are breaking through support and are making a good case for going short TBONDs. Link

Keene Little : 12/13/2006 11:36:09 AM

YM has retraced 50% of this morning's drop and ES just shy of 62%. This should be setting up the next leg down and I'd be looking for a short entry. The safest stop is at a new daily high but that's a bit far away. Test it and get out of the way if it pushes higher and then test it again.

Marc Eckelberry : 12/13/2006 11:34:53 AM

A push to ex gap open at 1430 is possible if they hold 1425. This a trader's environment, book profits and go back in, long or short. The close is what will count and bulls need it to be above 1429.25.

Jane Fox : 12/13/2006 11:30:15 AM

* MEDecision (MEDE) IPO rises to $9.90
* MEDecision IPO opens at $9.25

Jeff Bailey : 12/13/2006 11:28:31 AM

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

Jane Fox : 12/13/2006 11:34:56 AM

VIX to new daily lows. The bulls are back in control although I don't think they ever lost control.

Jane Fox : 12/13/2006 11:27:00 AM

AD volume to new daily highs.

Jane Fox : 12/13/2006 11:26:45 AM

I guess buying the dip is working today, its just that the dip was a lot deeper than I expected.

Jeff Bailey : 12/13/2006 11:19:30 AM

11:00 Internals found at this Link

Keene Little : 12/13/2006 11:06:29 AM

ES and YM found support at their daily pivots (1423 and 12396) and next support level is at their weekly pivots at 1421.25 and 12384. A break below those levels could see a continuation back towards yesterday's lows which would be near daily S1.

Jeff Bailey : 12/13/2006 11:02:28 AM

11:00 Market Watch found at this Link

Jane Fox : 12/13/2006 10:57:33 AM

IPG Photonics (IPGP) IPO rallies 45%

Keene Little : 12/13/2006 10:56:57 AM

The broken downtrend lines from December 7th, which ES and YM both dropped back below, may act as resistance now--ES 1426.50 and YM 12430.

Jane Fox : 12/13/2006 10:52:39 AM

SAN FRANCISCO (MarketWatch) -- The American Petroleum Institute reported a drop of 8.3 million barrels in crude supplies for the week ended Dec. 8. The Energy Department had reported a fall of 4.3 million. Motor gasoline supplies were down 1.1 million barrels, the API said, vs. the government's reported fall of 100,000. Distillate supplies were down 2.7 million barrels, the API said, compared with the 500,000-barrel fall reported by the government.

Marc Eckelberry : 12/13/2006 10:51:13 AM

Candles rarely end lie this so the bulls could green it, but as long as ES closes below 1429.25, the damage is done ahead of CPI Friday.

Keene Little : 12/13/2006 10:50:47 AM

It looks like we've had a pretty clean 5-wave move down from this morning's high. That suggests we'll see a corrective bounce (already in progress) which will lead to another leg down. Watch for resistance in the 38-62% retracement zone as an opportunity to trade the short side again. Continue to scalp these moves since we don't know yet what the bigger picture holds for us.

Jane Fox : 12/13/2006 10:49:40 AM

WASHINGTON (MarketWatch) -- The volume of applications for mortgages from major U.S. banks climbed to the highest level in more than a year last week, the Mortgage Bankers Association reported Wednesday.

Applications, encompassing both those for loans to purchase homes and for refinancings of existing mortgages, increased 11.4% last week to the highest level since October 2005. Total applications are up 22.2% compared with the same week a year ago. Application volumes had been down by double-digit percentages for most of the year.

Lower mortgage rates have spurred a rebound in loan applications, said Mark Fratantoni, senior economist for the mortgage bankers group, in a press statement. Average rates have fallen about 80 basis points, or 0.8 of a percentage point, since early summer, he noted.

Applications for a loan to buy a home rose 8.7% last week compared to the previous week, reaching the highest level since January.

Purchase loan volumes are down about 3% compared with the same week a year ago, the smallest year-over-year decline since January.

Jane Fox : 12/13/2006 10:40:46 AM

NEW YORK (MarketWatch) -- Forty-seven recent initial public offerings will join the broad-market Russell 3000 Index after the close of the U.S. equity markets on Dec. 15, said Russell Investment Group. Seven of these IPOs, including Bare Escentuals (BARE) and Hertz Global Holdings (HTZ), also will move directly into the large-cap Russell 1000 Index, while the remainder will flow into the small-cap Russell 2000 Index or the Russell Microcap Index. The IPOs set for inclusion to Russell's U.S. equity indexes include nine financial services, seven technology and six consumer discretionary firms.

Keene Little : 12/13/2006 10:40:42 AM

Another possibility here is that we're only going to pull back inside the recent trading range of the past week and then rally out of this. In my SPX chart that I posted earlier (9:56) I had said I'm looking for the 5th wave up from the low on December 8th. Instead of the 4th wave correction finishing on the 8th, as I labeled it on that chart, we could still be in the 4th wave consolidation. That interpretation calls for another pullback (which could be starting today) before setting up the final rally leg.

By not rallying above the recent consolidation that leaves open the possibility that we haven't seen the final rally leg yet. That would mean we'd likely see this market held up into the end of the year which woudn't surprise me in the least. January could be ugly but right now I'd say don't get overly enthusiastic about the down side nor give up on the upside. The jury is still out.

Marc Eckelberry : 12/13/2006 10:37:11 AM

Oil bid, stocks gap and crap. This confirms my theory that it's now about inflation and more rate hikes.

Jane Fox : 12/13/2006 10:36:12 AM

* Crude supply down 4.3 mln brls last week
* Distillate supply down 500,000 brls
* Gasoline supply down 100,000 brls:

Jeff Bailey : 12/13/2006 10:25:52 AM

OPEC Weekly Exports Down 10.4%, or 2.6M B/D - Lloyd's Unit

Marc Eckelberry : 12/13/2006 10:26:53 AM

I would be very careful about small caps. Maybe not right away, but the reckoning could be brutal in January. But we could have seen the highs in RUT last week.

Marc Eckelberry : 12/13/2006 10:21:48 AM

The stock market is about interest rates, not about the news or lagging indicators. It is especially true after a long bull run. This rally was built on hopes of a rate cut. That is no longer in the cards, in fact a rate hike in 07 is now very likely. We might rally some, but the distribution is taking place on a heavier basis every day.

Keene Little : 12/13/2006 10:20:16 AM

Interestingly, with the relative weakness in the techs, its chart shows the most bullish potential. The sideways triangle that has formed since its November high, as shown on this NDX chart, is a bullish continuation pattern. These sideways triangles (if that's the correct interpretation of what it's doing) usually points to the final move coming--in other words, one more high. Link

The flip side of this is very bearish--if price breaks down from this pattern then the EW count for the move down from the November high suggests we'll see a very quick flush to the downside which could see 1700 very quickly, as in a matter of days. Keep a close eye on this pattern--a break above 1803 (December 11th high) or below 1771 (December 12th low) could be good for a good ride in the direction of the break.

Jane Fox : 12/13/2006 10:11:57 AM

ES's PDH was not support and neither was YM's. My goodness is the unthinkable happening? Are the bears overcoming the bulls today?

Keene Little : 12/13/2006 10:10:15 AM

Uh oh. Now we'll see if support is found at gap fill.

Marc Eckelberry : 12/13/2006 10:07:46 AM

Inflationary fears will creep in and possibly give us a pullback, may be even a gap and crap ahead of CPI Friday. Yesterday's lows were met with solid bearish divergences for both ES and NQ. Watch bonds and how the ten year closes the Fed gap at some point, putting further margin pressures on equities in Q1. Last week's high for ES should hold if it fails at 1429.25. NQ highs are long gone and done (1850) since Thanskgiving.

Jane Fox : 12/13/2006 10:06:42 AM

WASHINGTON (MarketWatch) - Inventories at U.S. businesses rose in October to their highest level in relation to sales in more than two and a half years, the Commerce Department reported Wednesday.

Sales at U.S. businesses fell 0.2% in October after a record 2.3% drop in September.

Meanwhile, inventories rose 0.4% in October, as expected by economists, after a revised 0.3% gain in September.

The inventory-to-sales ratio rose to 1.31 from 1.30. It's the highest since February 2004. The typical business has goods on hand to meet nearly 40 days of sales.

In the one fresh piece of news in the report, the government said retail inventories were flat in October, as inventories at auto dealers fell by 0.6%.

In the past year, business sales are up 3.6%, while inventories are up 7.3%. The figures are not adjusted for price changes.

Inventories are loosening dramatically in the past few months, breaking a structural trend toward leaner inventories.

Jeff Bailey : 12/13/2006 10:02:46 AM

10:00 Market Watch found at this Link

Keene Little : 12/13/2006 10:02:10 AM

Looking at this bullishly, if ES pulls back to its broken downtrend line from December 7th, currently at 1426.50, watch for support to hold there as an opportunity to test the long side for a continuation of the rally. For YM that would be near 12430 which is also the top of its gap.

Keene Little : 12/13/2006 9:59:31 AM

Another small push higher could tag those weekly R1 and daily R2 levels for ES and YM. If ES hits 1433 I'd look to short it if the setup looks good. We could consolidate a little first which would make another high more likely. Closing this morning's gaps would have me questioning further upside. Just keep remembering this is opex and a larger move in either direction is not necessarily trend setting.

Jane Fox : 12/13/2006 9:56:42 AM

Atlas Energy Resources (ATN) IPO opens at $21.86

Jane Fox : 12/13/2006 9:54:08 AM

If the bears overtake the bulls today this market is a totally different market from what we have seen since summer.

Jane Fox : 12/13/2006 9:52:27 AM

I think this dip was a gift and that it should be bot.

Keene Little : 12/13/2006 9:50:34 AM

This SPX 60-min chart shows why I'm now watching carefully for evidence of a high for the rally. There are of course a couple of different possibilities for the wave count, especially in the choppy price environment we've been in, but my preferred count has been waiting for the last leg up in the 5th wave.

Because we're forming an ascending wedge this 5th wave will be a 3-wave move and two equal legs up from December 8th (the end of wave-4 as labeled on the chart) is at 1416.68. That's the first upside target for the end of the 5th wave. This morning's high is so far 1416.63 so missed it by a nickel. This is why a gap n crap this morning could be interpreted as very bearish. Link

But if the market can rally further then the next upside Fib projections are at 1421 and then 1424. The top of the wedge for price action from July is closer to the 1424 target but this being the 5th wave a common occurrence is for it to truncate--finish shorter than expected. Again, that's why a gap n crap could be a good sign for the bears. This morning's gap needs to hold for the bulls.

Jane Fox : 12/13/2006 9:50:31 AM

ES is now testing support at its PDH. I think it will hold.

Jane Fox : 12/13/2006 9:46:58 AM

OEX makes new yearly highs.

Jane Fox : 12/13/2006 9:45:30 AM

Dow at new all time highs.

Jane Fox : 12/13/2006 9:43:22 AM

Don't fool around with the tajectory of that AD volume. It is telling you the bulls are in control and will walk all over the bears. Link

Jane Fox : 12/13/2006 9:40:08 AM

ES and YM open above their PDHs but ER and NQ have not even tagged their respective PDHs.

Keene Little : 12/13/2006 9:38:33 AM

Once again NQ leads the pullback. There definitely seems to be more liquidation in the techs than the big caps at the moment. That is of course a defensive move by the fund managers--they want their money parked somewhere where they can exit fast if and when they need to.

Jane Fox : 12/13/2006 9:36:38 AM

Both Vix and TRIN are below their PDLs supporting the bullishness.

Jane Fox : 12/13/2006 9:35:41 AM

Oh my goodness AD line is +1015 and of course AD volume is above 0 and climbing. No doubt who has the ball and field position today.

Keene Little : 12/13/2006 9:30:27 AM

Assuming this gets a little higher this morning watch ES 1433 and YM 12478-12486 as this is where weekly R1 and daily R2 are located.

Keene Little : 12/13/2006 9:22:47 AM

The positive reaction to this morning's retail sales data shows the market can have its cake and eat it too. If the market is slowing down, which might mean the Fed is closer to cutting rates, the market rallies. If stronger retail sales shows a potentially stronger economy (and no rate decrease) the market rallies. Life is good. Now this morning's gap up better not turn into a gap n crap.

The sideways triangle idea I had yesterday will be negated with the move up this morning but that just means the rally leg that I've been expecting will be earlier, as in now. Fib projections for the move are to YM 12458 (two equal legs up from the December 8th low), which was missed by a point so far, and then just above 12500. For ES the upside projections are 1430 (already tagged) and then near 1438. This is the leg up that could finish the wave count and rally and will be the time I look to get into some long term short positions.

Jane Fox : 12/13/2006 9:11:02 AM

NEW YORK (MarketWatch) -- The dollar rallied against other major currencies early Wednesday after a government report showed U.S. retail sales increased much more than forecast last month.

These data "should give the dollar considerable support," said currency analysts at research firm Action Economics. The market "will keep an eye on Treasury yields, and with the 10-year now decisively back over the key 4.50% mark, the greenback gains may start to build from here."

In early New York trading, the dollar was quoted at 117.34 yen, compared with 116.76 yen late Tuesday. The euro changed hands at $1.3221, vs. $1.3277

Jane Fox : 12/13/2006 8:54:35 AM

Interestingly though Bonds did not like the retail data out at 8:30 and saw some serious selling. Link

Jane Fox : 12/13/2006 8:49:44 AM

Futures markets quite liked the retail data out at 8:30 and both ES and YM broke through their PDHs to show how much they liked it. Link

Jane Fox : 12/13/2006 8:44:55 AM

WASHINGTON (MarketWatch) - Showing surprising strength, seasonally adjusted U.S. retail sales increased by 1% in November, the largest gain since July, the Commerce Department reported Wednesday.

Excluding the 0.9% gain in motor vehicle sales, retail sales rose 1.1%, the largest gain since January.

Sales were much stronger than the 0.2% gain expected by economists surveyed by MarketWatch. They expected sales excluding autos to rise 0.3%.

Chain stores and auto makers had reported weak sales in November than were not reflected in the government's data.

The strong figures could force economists to re-evaluate their judgment that the economy is growing at a rate less than 2% annualized in the current quarter, particularly after a larger-than-expected decline in the trade gap reported Tuesday.

Sales in October were revised higher by three-tenths to a 0.1% decline. Sales excluding autos were revised slightly in October to a 0.3% decline.

Sales are up 5.6% in the past year. The figures are not adjusted for price changes.

In November, sales were strong in almost every retail sector. Only furniture stores showed a decline, falling 0.1%. Department store and clothing store sales were flat.

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