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Keene Little : 1/25/2007 10:01:21 PM

Friday's pivot tables: Link and Link

OI Technical Staff : 1/25/2007 9:59:59 PM

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Jeff Bailey : 1/25/2007 6:09:49 PM


DJ- Iraq official says "one or the other" U.S. oil major will get deal to build a new petrochemical facility, and he hopes a memorandum of understanding can be struck by July. Talks also are being held with other Western firms on industrial projects.

Jeff Bailey : 1/25/2007 6:08:55 PM


DJ- Firm posted loss of $134 million, or 7c a share, on $220 million charge and $353 million addition to a legal reserve. Revenue fell 16% to $4.21 billion as Plavix sales fall 53% to $496 million.

BMY $26.28 -2.63% ...

Jeff Bailey : 1/25/2007 6:07:18 PM


DJ- Nation's two largest defense contractors reported strong earnings growth and forecast continued gains in 2007. Lockheed shares gained 0.3% as its income jumps 28%. Northrop slipped 0.7% as earnings jumped 37%.

Jeff Bailey : 1/25/2007 6:05:29 PM


DJ- Company's 3Q net rises to $243 million, or 80c a share, compared with $193 million in the same period last year. Revenue rises to $23.11 billion vs. last year's $22.2 billion and McKesson ups its full-year forecast to a range of $2.75 to $2.85 a share.

MCK $55.37 +0.36% ...

Jeff Bailey : 1/25/2007 6:04:14 PM


DJ- Phone company earned $1.94 billion, or 50c a share, in 4Q, as revenue climbs 23% to $15.89 billion. AT&T, already reaping the benefits of its acquisition of BellSouth, boosted its forecast for merger cost savings.

T $36.79 +0.43% ...

Jeff Bailey : 1/25/2007 6:02:05 PM


DJ- Sales edge down to a 6.22 million annual rate in December. Sales for all of 2006 drop 8.4% from 2005's record to 6.48 million, third-best all time. Decline is the sharpest since 1989. Meanwhile, weekly jobless claims jump 36,000.

Jeff Bailey : 1/25/2007 5:30:57 PM

Closing Internals found at this Link

Jeff Bailey : 1/25/2007 5:13:00 PM

March Crude Oil (cl07h) settled down $1.14, or -2.06% at $54.23.

Jeff Bailey : 1/25/2007 5:08:21 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 1/25/2007 5:03:22 PM

General Motors (GM) To Delay Release of Q4 Until At Least Week Of Feb. 5 Pending GMAC

GM $33.14 +1.22% ...

Keene Little : 1/25/2007 4:59:53 PM

MSFT's after-hours bounce, which has given up some (printing 31.15 now) is not helping the futures which are all down below their closing levels. There's no way to tell if MSFT will have any influence on tomorrow morning's trading.

Keene Little : 1/25/2007 4:22:14 PM

MSFT to new highs--31.50 and climbing.

Jeff Bailey : 1/25/2007 4:15:29 PM

Microsoft (MSFT) $30.45 -2.05% ... called higher at $30.95 on headline numbers.

Earnings Press Release Link

Consensus was for EPS of $0.23 on Revenue of $12.08 B

Keene Little : 1/25/2007 4:15:21 PM

I haven't checked Mr. Softee's numbers yet but it's getting a nice after-hours bounce here (after the usual spike up and down). After closing at 30.45 it's printing 31 and climbing.

Jeff Bailey : 1/25/2007 4:09:22 PM

Amgen (AMGN) $74.85 -0.38% ... lower at $73.80 on headline numbers.

Earnings Press Release Link

Consensus was for EPS of $0.95 on Revenue of $3.77B

Keene Little : 1/25/2007 4:02:04 PM

Today certainly has the makings of a key reversal day--higher high, lower low and close at the low. If today were Friday we'd have a key reversal week for the OEX. Tomorrow will be critical in that regard, for the other indices as well. A lower close tomorrow for SPX would sound off the sell alarms in many computers.

Keene Little : 1/25/2007 3:59:45 PM

OEX broke Monday's low so that's another bearish sign. We're getting a lot of signs popping up saying "Bears This Way". Now as long as those signs aren't pointing to a bear trap we'll be fine.

Keene Little : 1/25/2007 3:52:32 PM

Like the NYSE we have the same bearish engulfing candles on the daily charts of the DOW and SPX. The DOW's uptrend line from November (the bottom of its ascending wedge) is at 12471 so if this manages to drop a little further tomorrow morning that's where I'd look for support for at least a bounce. I don't think they're ready to make it easy for the bears.

Jane Fox : 1/25/2007 3:47:55 PM

Economic Reports tomorrow include:

10:30a.m. Jan Dallas Fed Mfg Production Index. Previous: -5.2.

12:00p.m. Dec Chicago Fed Midwest Mfg Index. Previous: +0.3.

Jane Fox : 1/25/2007 3:46:25 PM

Don't ya just love the VIX. Link

Keene Little : 1/25/2007 3:45:27 PM

Speaking of IBM, after its gap down on January 18th it has been attempting to close that gap. It has retraced 50% of its drop from last week's high and stopped at its 10 and 20-dma's which crossed today just under 98. The price pattern of the bounce in the past week on the 60-min chart is starting to look like a rounding top (bearish).

Jane Fox : 1/25/2007 3:43:03 PM

Easy come Easy go but two very good trading days. Link

Keene Little : 1/25/2007 3:40:38 PM

And GM is in the green. What's up with that? IBM also a penny in the green.

Keene Little : 1/25/2007 3:38:51 PM

The semis held up reasonably well today--SMH is only down -0.3%.

Keene Little : 1/25/2007 3:35:51 PM

You're right Jane. We should be worried ;-)

Jane Fox : 1/25/2007 3:34:28 PM

Not sure where Jeff is on where the market is going from here so I guess I can't say all of us are on one side.

Jane Fox : 1/25/2007 3:33:45 PM

When was the last time Keene, Marc and I all agreed on anything?

Jane Fox : 1/25/2007 3:32:43 PM

Man alive all of us are on the same side of the boat. Are we going to tip over?

Keene Little : 1/25/2007 3:25:37 PM

With the break below 251 on XBD (brokers), I do believe I hear the fat lady singing on that one. That does not bode well for the broader market. Give me a good bounce tomorrow/Monday and I'll be more than willing to add to my short position.

Jeff Bailey : 1/25/2007 3:22:57 PM

03:00 Internals found at this Link

Keene Little : 1/25/2007 3:11:04 PM

NYSE has left a bearish engulfing candle on its daily chart after once again tagging the top of its longer term channel from January 2004. But for now it could find some support on its uptrend line from July (which was briefly broken in early January) at 9130 (currently printing 9150 and just below its 10-dma at 9157). Link

Keene Little : 1/25/2007 3:10:15 PM

If the DOW has made its high for the run up from July then we shouldn't see it again for many years to come.

Jeff Bailey : 1/25/2007 3:04:48 PM

03:00 Market Watch found at this Link

Marc Eckelberry : 1/25/2007 3:01:39 PM

YM did a perfect minor new high with a bearish div and the reversal today was stunning. We might not see those DOW highs again until spring or later.

Keene Little : 1/25/2007 2:59:00 PM

Continue to keep in mind my warning that we could see some very choppy price action that is full of whipsaws as we head to a final high for the rally from January's low. There are some signs today that we might have made an important high but until the DOW and SPX drop below Monday's lows (DOW 12450 and SPX 1420) today's decline could be nothing more than one of those whipsaws.

If you're short, identify a level that you don't want to see a rally above and stay disciplined. The bulls could come charging back (especially if there will be an effort to hold the DOW in positive territory for the month, which means staying above Monday's low). Today could have been engineered to suck in the bears to provide the buying fuel needed to charge higher.

Marc Eckelberry : 1/25/2007 2:54:46 PM

Bulls are barely holding ES 20 DMA at 1431, Resistance is clear at 1436, 5 and 10 DMA. Right now, resistance is building at 1431, 20 DMA, which is very bearish if lost.

Keene Little : 1/25/2007 2:42:20 PM

Was that the end of the run? If ES gets back above 1433 I'd say it probably is. A 38%-62% retracement of today's decline in that case gives us a potential resistance zone of 1435.75 to 1440.00 for a correction. If it instead heads back down for more lows then I'd say there's a good chance we'll see this stair-step lower into the close.

Jeff Bailey : 1/25/2007 2:35:18 PM

VIX-BV $0.65 x $0.75

Jeff Bailey : 1/25/2007 2:33:36 PM

VIX.X 11.21 (MONTHLY Pivot)

Marc Eckelberry : 1/25/2007 2:33:30 PM

We could see ES 1424 is NQ 1787 does not hold.

Keene Little : 1/25/2007 2:26:54 PM

Starting to get some short term bullish divergences so I'd be careful about chasing this lower.

Marc Eckelberry : 1/25/2007 2:21:56 PM

Don't be a hero quite yet. NQ has a gap to close at 1787.

Jane Fox : 1/25/2007 2:18:04 PM

Yesterday and today have been very easy to trade. Yesterday you just stayed long all day or bot the dips. Today you just stayed short all day or sold the rallies.

Keene Little : 1/25/2007 2:15:33 PM

A typical retracement is often back to the 4th wave so as labeled on that ES 15-min chart you can see that would take ES back up to near 1438.50 which would be a 50% retracement of today's decline. That makes for a good upside target and hopefully will be done with a clean a-b-c bounce to make for a good short entry, perhaps sometime tomorrow.

Keene Little : 1/25/2007 2:09:53 PM

If this decline keeps going this afternoon then it will probably get very ugly since it would mean instead of a 5-wave move down, as labeled on the ES chart, it's a more bearish 1-2, 1-2 wave count and we're only in the middle of the leg down. I don't expect that here but that's the risk if you try a long play here.

Jane Fox : 1/25/2007 2:09:26 PM

Wowsers - my new trading term.

Jane Fox : 1/25/2007 2:08:32 PM

Wowsers!!! Link

Keene Little : 1/25/2007 2:08:26 PM

In one fell swoop ES has crashed down through all of its uptrend lines starting from Monday. You can see a nice 5-wave move down on this chart so that's about the best sign a bear could see--an impulsive decline saying we should have a trend change now to the downside. Link

It also says we should be ready for a correction of today's decline so don't be bashful about taking some money off the table and look to reenter short after an expected bounce into tomorrow. That should set up a sweet short play into early next week.

Keene Little : 1/25/2007 2:01:15 PM

Speaking of H&S patterns, here's what you want to see play out on the small caps. First we'll see if ER finds support at Tuesday afternoon's 787.50 low (there as I type) and then get a bounce to build the right shoulder. It would be a very nice short play setup for a move to below last week's lows. Link

Marc Eckelberry : 1/25/2007 2:00:49 PM

That folks, is about as bearish a reversal I have seen in a very long time.

Marc Eckelberry : 1/25/2007 1:59:29 PM

You might want to cover partial contracts short at ES 1431.50, 20 DMA and lower stops on the remaining to your break-even.

Jane Fox : 1/25/2007 1:58:32 PM

TICKS -1000 remember the TICKS +1000 yesterday.

Marc Eckelberry : 1/25/2007 1:56:59 PM

I actually had 2 ES contracts short yesterday without a stop. That's how much faith I had in the historical precedent of closing a third time with VIX sub 10. I was going to keep adding on to the short if ES moved up some more. I put in an NQ long at 1805 to hedge, but that turned out to be unnecessary. It might still be a play I will use tonight or near the close. ES stops on shorts should now be lowered to 1446 and let it ride.

Marc Eckelberry : 1/25/2007 1:57:50 PM

January 1994 revisited. 10% correction on the way? SPX 1285/1300 by March if history repeat itself. Party is over unless bulls can close SPX above 1435. MSFT needs to beat the whisper on guidance rev. In line will not suffice after a 40% run up.

Jane Fox : 1/25/2007 1:53:57 PM

... of course you need to wait for confirmation. I don't care how bearish this chart is, it needs to tell me my opinion is the "right" one. That confirmation is a close under the 50EMA.

Keene Little : 1/25/2007 1:52:17 PM

Oh I am Jane (smile). After taking some profits off the table at the January low I reentered some QQQQ puts yesterday near the close. The setup was just too tempting.

Keene Little : 1/25/2007 1:51:04 PM

YM has made it down to its weekly S1 at 12568. Just below that is daily S2 at 12556.

Jeff Bailey : 1/25/2007 1:51:02 PM

US Treasury Awards 5-Yr Notes At 4.855%; 92.11% At High

DJ- The U.S. Treasury awarded $13.00 billion in five-year notes at Thursday's auction at a high rate of 4.855%.

The Treasury received bids totaling $28.71 billion and accepted $13.00 billion, including $140.16 million of noncompetitive tenders, up from $110.21 million at the previous five-year note auction on Dec. 28, 2006.

There were no bids from foreign and international monetary authority accounts on a noncompetitive bidding basis.

The bid-to-cover ratio, an indication of demand, was 2.21, Treasury said.

Tenders submitted at the high yield were allotted 92.11%.

The median rate was 4.832%; that is, 50% of the amount of accepted competitive bids were tendered at or below that rate.

The dollar price was 99.538790 and the coupon rate was set at 4.750%.

Of the competitive bids accepted, 5% were tendered at or below the rate of 4.796%.

The high rate was up from 4.704% at the previous five-year note auction. The high rate was the highest since 4.995% at the five-year note auction on July 27, 2006.

The issue is dated Jan. 31 and matures on Jan. 31, 2012.

The CUSIP number on the five-year notes is 912828GF1.

Jane Fox : 1/25/2007 1:50:10 PM

Keene smack your lips on this bearish chart of the Qs. H&S forming and bearish MACD divergence. Any doubts as where this little puppy is headed. Link

Keene Little : 1/25/2007 1:48:33 PM

With weekly S1 at 1430.50 and daily S2 at 1430.75 that could be our ultimate target for today (if 1433 doesn't hold). If those were to break then yikes the bears are on a rampage.

Keene Little : 1/25/2007 1:46:37 PM

ES just smacked that uptrend line so the test is on.

Jeff Bailey : 1/25/2007 1:46:26 PM

Bank Of Canada's Dodge Sees Economy Operating Near Capacity

DJ- Bank of Canada Governor David Dodge said the Bank of Canada believes the Canadian economy "will continue to operate close to production capacity through to the end of 2008."

He made the comment in a speech in Toronto to the Canadian Netherlands Business and Professional Association and the European Union Chamber of Commerce.

Dodge said "our judgment is that the economy was operating right at, or just slightly above, the limits of its capacity at the end of 2006."

The governor said the Bank of Canada also projects that core inflation in Canada will stabilize close to 2% as pressures from house prices ease and the economy remains near potential.

Dodge said "the main upside risk to our inflation projection comes from household demand in Canada. With the increases in house prices in many parts of the country, consumption could be stronger than expected as households borrow against the increased equity in their homes."

Dodge said the main downside risk to the inflation projection continues to come from the United States "where clear weakness remains in the housing sector." But he said there are "encouraging signs." He said the slowdown in the U.S. housing and automotive sectors doesn't appear to have spread more broadly."

Dodge warned that there remains "a possibility of a disorderly resolution of global imbalances. Global imbalances refers to the large current account deficit in the United States that is mirrored by current account surpluses in Asia and many oil exporting countries.

The governor recommended a strengthening of the International Monetary Fund to help deal with "the danger posed by global imbalances."

Keene Little : 1/25/2007 1:44:32 PM

Next important test for ES is just above 1433, it's uptrend line from the January low. A poke through that line could find support at Tuesday afternoon's 1431.50 low.

Keene Little : 1/25/2007 1:37:50 PM

The brokers have been one of the more bullish sectors so it will be important to keep an eye on them. If the index drops below Tuesday's low at 251 then that could spell the end of its rally. From an EW standpoint it would say the 5-wave run up from December 1st is finished, and that leg was the 5th wave of the rally from June. And that rally was the 5th wave of the rally from October 2002.

Get my drift here? Just a little ol' drop below 251 could say we've seen THE top in the brokers. And that would say the broader market is there as well. Right now the daily chart is looking like a tweezer top if the brokers close down near here. And the test of the January high is leaving a huge bearish divergence. Starting to smack my lips and keep from slobbering all over my keyboard.

Keene Little : 1/25/2007 1:27:03 PM

The brokers, including Mother MER, have given up quite a bit today, down 1.6%. XBD did not make it up to its Fib projection at 260.56, topping out at 258.78 yesterday, but it might have been close enough. For now the uptrend line from January 8th, at 253.70, should act as support. It's at 253.80 as I type so we could see the brokers find a bottom for the day right here.

Jane Fox : 1/25/2007 1:26:38 PM

These are still very bearish. Link

Jeff Bailey : 1/25/2007 1:19:29 PM

01:05 Internals found at this Link

Keene Little : 1/25/2007 1:17:47 PM

Bonds are still selling off and the 200-dma's have been exceeded. It'll be interesting to see how they close. If money starts leaving equities in preparation to move over to the safety of bonds then we should get some buying pressure on the bond side. But we still don't know if today is the start of something bigger to the downside or just a pullback. There is still some time left in January and big money is going to want to see it go out positive.

Jane Fox : 1/25/2007 1:16:54 PM

ER has a MACD divergence but the only one that does. Link

Jane Fox : 1/25/2007 1:12:56 PM

Today is a sell the rallies day. Each time the market retraces and the AD volume makes a new daily low and the VIX remains at daily highs is another chance for you to get short.

Jeff Bailey : 1/25/2007 1:07:12 PM

01:05 Market Watch found at this Link

Keene Little : 1/25/2007 1:05:06 PM

If ES 1435.75 holds on the next test, and shows some short term bullish divergences, it could be a good time to test the long side. A break of today's downtrend line would also signal at least a larger bounce in the making. That downtrend line is currently close--1438.50. But watch for a failed retest of the broken uptrend line from Tuesday's low, now just above 1440.

Jeff Bailey : 1/25/2007 12:59:27 PM

Swing Trade NAKED PUT filled alert for the XBA-OF at the bid of $0.60

EBAY $32.15

Keene Little : 1/25/2007 12:34:38 PM

YM is in a very similar pattern as ES and the first Fib projection was met yesterday once it hit 12657. If today's pullback is only a correction of the leg up from Monday then there's no question we'll see YM head for it upper target at 12758. The fact that price has broken the uptrend line for this week's rally says that leg up is finished. Link

Now the question is whether that leg up was all of wave-C (for the A-B-C move up from the January low) or just the 1st wave of C. For now keep an eye on the 12590 area where we have an uptrend line off the early part of the rally from Monday. It's also the location of the 30-min 100/130-pma's.

Jeff Bailey : 1/25/2007 12:31:28 PM

"Eyeball" for a XBA-OF bid of $0.60 would be EBAY around $32.10.

Jeff Bailey : 1/25/2007 12:29:37 PM

EBAY traded RED #4 $32.45 (5-MRT)

Jeff Bailey : 1/25/2007 12:28:22 PM

eBay (EBAY) $32.50 +8.33% .... XBA-OF $0.50 x $0.55

Jeff Bailey : 1/25/2007 12:26:17 PM

Yahoo! (YHOO) $28.19 -2.59% ... edges below yesterday's gap open low. WEEKLY Pivot here at $28.21.

Keene Little : 1/25/2007 12:19:44 PM

If we're going to get just a corrective pullback, albeit a sharp one, two equal legs down from yesterday's high is at ES 1435.75. It could be a good spot to think about trying a scalp long. If this is just a corrective pullback then the scalp long could turn into a swing long. I'm taking nothing for granted with this market and am thinking of hedging my short play.

Jeff Bailey : 1/25/2007 12:15:57 PM

VXN.X 17.50 +5.35% ...

Jeff Bailey : 1/25/2007 12:15:35 PM

XBA-OF $0.45 x $0.50

Jeff Bailey : 1/25/2007 12:15:20 PM

eBay (EBAY) $32.80 +9.35% ... new session low.

Keene Little : 1/25/2007 12:10:21 PM

The trend line at ES 1439 has been broken (good news for shorts) so at this point I'd keep an eye on that trend line (from Tuesday's low). A retest of it should be a good setup for another short play. Next trend line support is the one from the January low, currently just under 1433. Before that though we have the 30-min 100 and 130-pma's at 1435 and 1436.

Jeff Bailey : 1/25/2007 12:08:38 PM

Russell 2000 Index (RUT.X) 788.13 -0.74% ... set to test correlative 21-day SMA and 50-day SMA (786)

Jane Fox : 1/25/2007 12:07:43 PM

Hopefully none of you went long.

Jeff Bailey : 1/25/2007 12:07:28 PM

QQQQ $43.97 -0.74% ... undercuts correlative 21-day SMA and 50-day SMA ($44.00)

Jane Fox : 1/25/2007 11:56:01 AM

NEW YORK (MarketWatch) -- Treasurys extended their losses Thursday, sending yields higher, after new data showed an unexpectedly large decline in sales of existing homes, but also pointed to declining housing inventories and a stabilization of sale prices.

Treasurys also were being pressured by unusually large corporate supply and fund repositioning, according to Action Economics.

Jane Fox : 1/25/2007 11:42:42 AM

VIX to new daily highs and AD volume to new daily lows. This ain't the time to be long folks.

Keene Little : 1/25/2007 11:41:31 AM

Time for some rotation out of equities into bonds.

Keene Little : 1/25/2007 11:39:57 AM

I showed this TNX chart in last night's Wrap. With it at 4.85% this morning it's now tagging its 200-dma so there's a decent possibility we'll see rates pull back and that sets up a long play for ZN (10-year e-mini). Link

Jane Fox : 1/25/2007 11:39:29 AM

TRIN is now making a new daily high but at 0.76 I can't call it bearish.

Jane Fox : 1/25/2007 11:38:23 AM

That little rally we had could have been used to get short. The very low TRIN does not seem to be helping the bulls today.

Keene Little : 1/25/2007 11:36:18 AM

This ES 15-min chart is an update to the one I showed yesterday with the increasingly steeper trend lines for the move up from Monday. The last two, steeper, trend lines have been broken and the next one is near 1439. I'm surprised we didn't get more of a retest of the 2nd broken trend line but it's entirely possible that could still happen. Having shorted yesterday's high I'd obviously like to see these trend lines continue breaking. Link

Jeff Bailey : 1/25/2007 11:34:42 AM

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

Jeff Bailey : 1/25/2007 11:28:38 AM

Swing trade sell NAKED PUTS alert place an order (GTC) to SELL NAKED two (2) of the EBAY Mar $30 Puts (XBA-OF) for a LIMIT price of $0.60.

Note: I will be away from the MM tomorrow 1/26/07.

Keene Little : 1/25/2007 11:18:46 AM

Here's an update to the SPX 60-min chart that I've been using to monitor the final push higher (assuming it's the final push). At the end of the day it hit its first upside Fib target at 1439.74, which is where wave-C of the move up from the January low is equal to 62% of wave-A. It has pulled back but is finding support at the broken trend line along the highs of December and January, currently at 1436.25. Stay aware of the possibility that SPX could still rally up to the upper target near 1452. Link

A drop below 1431 (the mid-day high on Tuesday the 23rd) would be my first heads up that the rally could be finished. Better confirmation will be a drop below 1425 (below Tuesday afternoon's low). It takes a drop below 1420 to get the wave pattern more bearish and then finally a drop below 1404 to seal the deal for the bears.

Jeff Bailey : 1/25/2007 11:18:26 AM

11:00 Internals found at this Link

Marc Eckelberry : 1/25/2007 11:17:18 AM

Long NQ and short ES if you caught H/L on each (short High ES and long Low NQ) is a way to proceed forward. Hedge funds are gravitating to high beta techs in order to get max returns, while energy and financials could hurt ES. Watch NQ 1808, 20 DMA support and ES 1443.75 resistance. The trick to this trade is that it can give you a higher short entry on ES without risk, since techs are hot now, you should get a small edge. Stop adjustment is key on this trade. When BOJ raises rates, the carry trade might be over and liquidity could vanish, giving us a sell-off. Until ten, chop. That's my trade this morning. I am cancelling the YM overnight signal. I might take that on the fly if it gets to 12695, but with MSFT on deck, it's best to do a hedge trade. All long bets are off on an NQ break with volume below 1805, so if you caught the NQ lows, the stop should be at 1805. I am much more liberal with my ES short stop as I see more macro potential there. At least for now.

Keene Little : 1/25/2007 11:03:14 AM

Good morning Keene, I just read where Mother Merrill increased it's CEO, Stanley O'Neil's pay by 30%, to $48 million a year. I used to have a large account at Mother, and this is just one of the reasons I closed it out in early 2000. This kind of corporate pay needs to cease.

George, I think more and more people are getting pretty disgusted by the money grab we're seeing at the higher echelons. The pendulum is swinging too far.

Jeff Bailey : 1/25/2007 11:02:01 AM

11:00 Market Watch found at this Link

Jeff Bailey : 1/25/2007 10:56:57 AM

I'd "like" to be able to get a NAKED XBA-OF entry at $0.60/contract (two/2) if able. That OBLIGATES a trader to BUY 200 shares of EBAY at ($30.00 - $0.60 = $29.40) on or before March expiration.

Jeff Bailey : 1/25/2007 10:52:26 AM

Benchmark ... EBAY $33.05 +10.16% ... XBA-OF $0.40 x $0.50 (low/high has been $0.35-$0.55) 1,883 contracts so far.

Jane Fox : 1/25/2007 10:44:50 AM

Or "Calm before the storm" Ben.

Keene Little : 1/25/2007 10:44:16 AM

And the slowdown in housing is why Helicopter Ben has been so active dropping bucket loads of money since last July.

Jane Fox : 1/25/2007 10:44:14 AM

Now who would I believe? HMMMM

Jane Fox : 1/25/2007 10:43:40 AM

Keene I am seeing a stark divergence between what the Home Builder's CEOs are saying and what economists are saying about the housing industry.

Keene Little : 1/25/2007 10:41:59 AM

I'm not sure how much clearer the heads of the home builders can be that we are NOT seeing a bottom in the housing market. The NAR (National Association of Realtors) is obviously smoking the hope pipe when calling a bottom.

Jane Fox : 1/25/2007 10:41:52 AM

SAN FRANCISCO (MarketWatch) -- The Energy Department said natural-gas inventories fell 179 billion cubic feet for the week ended Jan. 19. Fimat USA expected a decline of 181 billion. Total stocks now stand at 2.757 trillion cubic feet, up 251 billion cubic feet from the year-ago level, and 472 billion cubic feet above the five-year average, the government data said. February natural gas was last down 22.1 cents at $7.20 per million British thermal units, trading at the session's low.

Jane Fox : 1/25/2007 10:38:39 AM

..."At this point, we have yet to see any meaningful evidence of a sustainable recovery in the housing market," said Ian McCarthy, Beazer's president and chief executive, in the earnings release. "Most markets across the country continue to experience lower levels of demand for new homes, high cancellation rates and significant levels of discounting," the CEO added.

Jane Fox : 1/25/2007 10:35:37 AM

BOSTON (MarketWatch) -- Beazer Homes USA Inc. reported Thursday a first-quarter loss and said it sees little proof pointing to "meaningful" recovery in the nation's housing market.

The company (BZH) said it posted a loss of $59 million, or $1.54 a share, in the quarter ended Dec. 31, a reversal from the profit of $89.9 million, or $2 a share, generated in the first three months of fiscal 2006.

The Atlanta-based home builder said it would have generated net income of $15.9 million, or 41 cents a share, for the latest quarter if the results were adjusted to exclude $119.9 million in charges taken for inventory impairments and abandoned land-option contracts.

Jane Fox : 1/25/2007 10:34:43 AM

WASHINGTON (MarketWatch) -- Led by a large decline in the West, sales of U.S. existing homes fell 0.8% in December to a seasonally adjusted annual rate of 6.22 million, a national real estate group reported Thursday.

Sales in December were down 7.9% compared with December 2005.

For all of 2006, existing-home sales fell 8.4%, the largest annual decline in 17 years.

Inventories of unsold homes fell 7.9% in December to 3.51 million, representing a 6.8-month supply, the National Association of Realtors said in the report. It's the smallest inventory in relation to sales since June.

"It appears we have established a bottom," said David Lereah, chief economist for the NAR. "We are still vulnerable; we are not out of this yet."

Jeff Bailey : 1/25/2007 10:32:08 AM

EIA Nat. Gas Storage Table at this Link ... Draw of 179 Bcf

Jane Fox : 1/25/2007 10:32:06 AM

Keene when I used Qcharts I was only able to use the MR symbol, the ER2 symbol was not available.

Keene Little : 1/25/2007 10:28:37 AM

The key with ER2 is that symbol is only recognized by the #10 and #11 Santa Clara servers. All other qcharts servers use MR. That has to do with a pilot project that Lycos was doing before the sale to esignal.

Thanks Al, great to know.

Jeff Bailey : 1/25/2007 10:25:51 AM

eBay (EBAY) $33.20 +10.66% ... PnF chart at this Link

Keene Little : 1/25/2007 10:23:28 AM

I got an email from Marie asking for help on getting ER207H (the RUT e-mini) to display prices on QCharts. I've had this problem many times with QCharts and I'm sure others have as well. The other symbol that works is MR07H and sometimes switching back and forth will bring up prices and/or charts. Switching servers sometimes helps (ctrl-alt-n).

Jeff Bailey : 1/25/2007 10:21:03 AM

eBay Options Montage (Mar, Apr, July, Jan08) at this Link ... Looking at SELLING NAKED the Mar$30 Puts, and would eventually look at Jul$32.50 C, or Jan08$35 C.

I think "the tide has turned!"

Jane Fox : 1/25/2007 10:20:20 AM

Interesting though YM is not making new daily lows - yet.

Jane Fox : 1/25/2007 10:19:56 AM

Oh my gosh Keene you are right NQ is falling like a rock now.

Keene Little : 1/25/2007 10:19:12 AM

After the brief rally the techs are now asking "where's the love?" With the 30 and 60-min charts overbought and rolling over it's a good setup to at least see a pullback today. One leg at a time after that to see what develops.

Jane Fox : 1/25/2007 10:17:44 AM

Looks like the VIX and AD volume are leading the market downwards but the TRIN is saying we are not going to do it fast.

Jane Fox : 1/25/2007 10:05:08 AM

WE certainly do have a battle of the internals today so if you don't want to be collateral damage I would stay away from the front line for now.

Jane Fox : 1/25/2007 10:03:44 AM

The VIX makes new daily highs and ES makes new daily lows but they do not stick because we don;t have the AD volume making new daily lows.

Jeff Bailey : 1/25/2007 10:02:43 AM

10:00 Market Watch found at this Link

Jane Fox : 1/25/2007 10:02:12 AM

VIX is testing daily highs and I am getting more and more bearish.

Jane Fox : 1/25/2007 10:01:26 AM

I will not take a long position either based on the VIX and AD volume. I need to see some kind of leadership and I am not seeing it at all.

Jane Fox : 1/25/2007 9:59:48 AM

You know I don't put a lot of emphasis on the TRIN but when it is 0.64 and below its PDL I take note and no matter how bearish the AD volume and VIX may be I will not short.

Keene Little : 1/25/2007 9:54:08 AM

The techs are getting what little love is available this morning.

Jane Fox : 1/25/2007 9:50:22 AM

Unreal. Link

Jane Fox : 1/25/2007 9:49:41 AM

... while the other three are making new daily lows. OK this is a first for me.

Jane Fox : 1/25/2007 9:49:18 AM

NQ is making new daily HIGHS!

Jane Fox : 1/25/2007 9:47:37 AM

VIX and Ad volume are bearish but take a look at the TRIN. It is quite bullish. Link

Jane Fox : 1/25/2007 9:40:34 AM

ES is playing tag with its overnight low but so far has not broken it.

Jane Fox : 1/25/2007 9:39:51 AM

ER breaks its overnight low.

Jane Fox : 1/25/2007 9:38:59 AM

AD volume climbing but AD line falling. No direction at all.

Keene Little : 1/25/2007 9:37:50 AM

We're just kind of stuck. Who will blink first.

Jane Fox : 1/25/2007 9:35:57 AM

So far my scenario of higher highs intraday is not playing out.

Jane Fox : 1/25/2007 9:35:21 AM

ER tags its overnight high but does not have enough buyers to break through.

Jane Fox : 1/25/2007 9:32:52 AM

AD line is -289 and AD volume below 0 but barely. No one has the ball this morning.

Jane Fox : 1/25/2007 9:17:26 AM

When price consolidates at PDHs the most likely scenario is an intraday break of the overnight highs. Link

Keene Little : 1/25/2007 9:14:00 AM

With the DOW and SPX hitting their first upside Fib targets for this rally it's now time to be very cautious about the upside. As of yesterday's close it was a good time to try a short play based on the EW pattern and the Fib projections. DOW 12625 area and SPX 1440 could be the end of line for the bulls.

If the rally continues then the next upside targets are DOW 12727 and SPX 1452-1455 so it's worth a try here but don't let it go too much against you. To lower the risk try buying a few puts with no stop (so no more than you'd normally risk on a futures trade). If the trade starts working then you can leg into a few more. Build yourself a position rather than all or nothing.

Jane Fox : 1/25/2007 9:10:03 AM

NEW YORK (MarketWatch) -- Gold futures traded higher early Thursday, strengthened by rising oil prices and renewed weakness in the dollar.

Gold for February delivery was up $5.30 at $653.50 an ounce on the New York Mercantile Exchange.

James Moore, an analyst at TheBullionDesk.com, said in a Thursday note that gold's rebound above the $640.20/645 chart lines continues to suggest a return to more bullish trends with the metal likely to find scaled up resistance from $648 to $656.

"While a period of consolidation would be healthy, a breach of the resistance band could trigger a rally to the $676 high posted in July," Moore said.

Jane Fox : 1/25/2007 8:51:44 AM

WASHINGTON (MarketWatch) -- The number of newly laid-off workers filing applications for state unemployment benefits climbed sharply in the latest week, suggesting some slack in labor markets at the beginning of the year.

The Labor Department said Thursday that first-time claims for jobless benefits rose by 36,000 to a seasonally adjusted 325,000 in the week ended Jan. 20, marking their highest level since Dec. 30. Economists had been expecting 310,000 new claims.

Meanwhile, the four-week average of initial claims rose by 1,500 to 309,250, the highest since Jan. 6. Economists consider the four-week average a better measure of labor market strength because it smoothes out one-time events like strikes or weather.

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