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OI Technical Staff : 2/16/2007 9:59:59 PM

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Jeff Bailey : 2/16/2007 7:57:38 PM

Closing Internals found at this Link

Jeff Bailey : 2/16/2007 7:27:32 PM

Closing U.S. Market Watch at this Link

Jeff Bailey : 2/16/2007 7:21:17 PM

VLO's direct competitors ... Link

Jeff Bailey : 2/16/2007 7:20:40 PM

Valero Energy (VLO) $55.96 +0.71% ... last tick in extended was $55.00.

Jeff Bailey : 2/16/2007 7:18:00 PM

Valero Sunray, Texas, refinery (update) ... Reuters Link

Jeff Bailey : 2/16/2007 7:02:00 PM

Fire breaks out at Valero, Sunray refinery ... Reuters Story Link

Jeff Bailey : 2/16/2007 6:53:51 PM

Ohhhh Jimmy C ... so right, so right ... Always use a LIMIT order when buying/selling.

Jeff Bailey : 2/16/2007 6:43:05 PM

Ohhhh Jimmy C ... so wrong, so wrong ... USPIX $12.70, UCPIX $12.51, GM $36.34 -0.27%, BHI $65.05, MSFT $28.74 -2.44%, YHOO $31.91 +2.11% ....

Always use a stop loss. Place it where you DON'T think the security should trade, where if it does, your analysis might be WRONG compared to what the MARKET believes.

Jeff Bailey : 2/16/2007 6:23:13 PM

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

Jeff Bailey : 2/16/2007 5:51:57 PM

Table of November CME Housing Futures Benchmarks at this Link

Jeff Bailey : 2/16/2007 5:47:45 PM

Table of May and Aug CME Housing Futures Benchmarks that I monitor at this Link

I have been more "religious" on getting each Friday's close, but for whatever reason I had captured the 02/07/07 trade, just before the 02/08/07 news out of NEW/HBC.

Jeff Bailey : 2/16/2007 5:30:40 PM

CME's February Housing Futures snapshot at today's close Link

Jeff Bailey : 2/16/2007 4:43:00 PM

DIA goes out at $127.57 ...

Keene Little : 2/16/2007 4:30:34 PM

I hope all y'all have a great holiday weekend. See you Tuesday.

Jane Fox : 2/16/2007 4:27:48 PM

See you all on Tuesday.

Keene Little : 2/16/2007 4:20:50 PM

The DOW was a little stronger in its bounce this afternoon (gee, now there's a surprise--need to keep the sheeple interested in buying this market so needed the positive news over the weekend). It bounced up to the point where wave-C in today's A-B-C bounce = 162% of wave-A, at 12768.60 and just shy of its 78.6% retracement at 12769.80. This too looks like a perfect setup for a short. But it needs to head immediately south on Tuesday morning. Link

Jeff Bailey : 2/16/2007 4:13:55 PM

tm 12,791

Jeff Bailey : 2/16/2007 4:10:17 PM

DIA ... INET looks $127.50 close

Keene Little : 2/16/2007 4:09:25 PM

Not that I give that much credence to a 5-min candle but I do like the shooting star with a close at SPX 1455.57 when the Fib target was 1455.59 and the 62% retracement at 1455.53. A leg down on Tuesday that goes 162% of this morning's leg down gives us 1445.46 for wave-3, a little bounce and then continue lower. I'll take it (if offered). If you shorted ES 1459 I'd keep my stop at 1461 and hope it survives the weekend. Good luck. Link

Jeff Bailey : 2/16/2007 4:08:03 PM

Dumping a YM long here

Marc Eckelberry : 2/16/2007 4:06:42 PM

In fact, globex should trade on Monday for a few hours.

Marc Eckelberry : 2/16/2007 4:06:15 PM

Alert: YM short 12801, raise stop back to 12811, hold over. There is enough room, barely, to stay in the trade. For those who are not comfortable with the possibility of a higher gap open Monday, get out now for +15. I'll take my chances. Remember that YM opens after ES, so you can hedge with ES if there is a bid.

Jeff Bailey : 2/16/2007 4:04:16 PM

DIA $127.57 and session high.

Jeff Bailey : 2/16/2007 4:02:34 PM

HSBC Holdings (HBC) $89.55 -0.13% ....

Jeff Bailey : 2/16/2007 4:02:06 PM

New Century Financial (NEW) $19.40 +3.30% ...

Marc Eckelberry : 2/16/2007 4:01:34 PM

Looks like a close below 12793.

Jeff Bailey : 2/16/2007 4:01:19 PM

Fed's Moskow: Lenders Must Fully Disclose Subprime Risks

Keene Little : 2/16/2007 4:00:23 PM

If we get a quick pop higher on Tuesday, SPX could pop up to the top of its bear flag for today, so perhaps up near 1456.20 and then roll over. Anything above 1457 (gap close) and I'd be scared out of my shorts (literally and figuratively). Link

Marc Eckelberry : 2/16/2007 3:58:28 PM

Looks like unfilled gaps for ES and NQ.

Keene Little : 2/16/2007 3:56:11 PM

The potential setup as we head into the close is a 1st wave down followed by a 2nd wave bounce, particularly on the DOW and SPX. The RUT made a new high above yesterday's and that's a bit worrisome if you're short the other indices (that new high should have had you out of any shorts in ER). But the DOW and SPX support the view that we'll have a down open and down day on Tuesday--a 3rd wave down.

It won't be a screamer but we could see DOW 12700 quickly, some consolidation and then press a little lower before getting another larger corrective bounce. So if you're long the market that's the downside potential I see for Tuesday. Remember the market is closed on Monday.

Jeff Bailey : 2/16/2007 3:55:14 PM

A strong bullish bias could develop if DIA were to capture a close above $128.00. That is ... VXO.X was FALLING into expiration, yet the DIA $128.00 puts was heaviest OI. That hints that there was still PUT SELLING and CALL BUYING.

Who in their right mind would be so bold as to SELL $128.00 puts?

Yep... a BEAR that is overly short/naked something else.

Jane Fox : 2/16/2007 3:53:24 PM

Now it's time to stand up for my friends who did not make it home, and for those who fought and died in Iraq already," he said. "We must not cut funding for our troops. We must stick by them," he added, snapping off a salute as he completed his remarks to yet another ovation.

Mr. Bush made no comment on the developments.

Jeff Bailey : 2/16/2007 3:52:10 PM

Now THIS is what manipulation is.

Jane Fox : 2/16/2007 3:51:38 PM

Dateline WSJ - WASHINGTON -- The Democratic-controlled House issued a symbolic rejection of President Bush's plan to deploy more troops to Iraq on Friday, opening an epic confrontation between Congress and commander in chief over an unpopular war that has taken the lives of more than 3,100 U.S. troops.

The vote on the nonbinding measure was 246-182. Seventeen Republicans voted for the resolution, while two Democrats opposed it.

"The stakes in Iraq are too high to recycle proposals that have little prospect for success," said Speaker Nancy Pelosi, leader of Democrats who gained power last fall in elections framed by public opposition to the war.

"The passage of this legislation will signal a change in direction in Iraq that will end the fighting and bring our troops home," she vowed.

Mr. Bush's Republican allies said repeatedly the measure would lead to attempts to cut off funds for the troops. Outnumbered, they turned to Rep. Sam Johnson of Texas to close their case -- and the former Vietnam prisoner of war stepped to the microphone as lawmakers in both parties rose to applaud his heroism.

Jeff Bailey : 2/16/2007 3:51:24 PM

YM 12,785 ... and a little further pain for a short.

Jeff Bailey : 2/16/2007 3:50:54 PM

A "little bit of pain" being delivered to a long on the DAW-NX ... $0.40 x $0.45 ... 4,168 traded.

Keene Little : 2/16/2007 3:46:08 PM

I received a good question about the need to change the key level for NDX--I had 1823 as the level that would negate the bearish count. Based on today's price action and the possibility that it could get to 1829-1830 without damaging the bearish wave count, I'm raising that key level to 1830. That would also be a 78.6% retracement of the January decline and that's the "line in the sand". Any retracement greater than that and you could expect new highs in that case. I'm not saying that's where we're headed but that's the potential if yesterday's high is now exceeded.

Jeff Bailey : 2/16/2007 3:43:53 PM

Mexico's Q4 GDP Rises 4.3% On Year; Consensus +4.5%Q4 GDP Up Seasonally Adjusted 0.47% From Q3

GDP up 4.8% In 2006.

Jeff Bailey : 2/16/2007 3:39:08 PM

Expect anything in last 45-minutes for YM and be ready to cut and run

Keene Little : 2/16/2007 3:38:26 PM

NQ came within a tick of closing its gap. Close enough? I wouldn't be surprised with another little push higher into the close just to keep the bears in their caves for the weekend. I like the short setup. I like it a lot.

Jeff Bailey : 2/16/2007 3:38:16 PM

VXO.X 9.82 -0.60% ... for most part has just krept lower from the open.

Jeff Bailey : 2/16/2007 3:36:59 PM

YM 12,784 ... pressed against my WEEKLY 19.1% pivot retracement.

Jeff Bailey : 2/16/2007 3:35:57 PM

DAW-BW $0.45 x $0.55 with 1,199 traded.

Jeff Bailey : 2/16/2007 3:35:05 PM

DIA $127.50 ... DAW-NX $0.45 x $0.50 with 3,841 contracts traded.

Keene Little : 2/16/2007 3:32:48 PM

As for NDX, it just tagged the level where the 5th wave = 62% of the 1st wave in the wave-C this afternoon. The minimum upside has been met. Link

Keene Little : 2/16/2007 3:30:01 PM

ES just tagged its 1459 target so the test is on. That was the short entry level and I'd use a normal 2-pt stop.

Keene Little : 2/16/2007 3:28:55 PM

There is one other slightly more bullish possibility for NDX in case you want to try the short side on this bounce. Looking at the 30-min chart and the move up from Monday, we could be in the 5th wave and it projects to 1829.63 if it's to equal the 1st wave. Any push above yesterday's high would suggest that's where this is headed. Try a short here and if stopped out then try again at the higher level. Link

Jeff Bailey : 2/16/2007 3:28:05 PM

VXO.X 9.82 -0.06% ... YM 12,786

Jane Fox : 2/16/2007 3:27:59 PM

Remember ES's overnight highs are sitting at 1459.75 and should be resistance.

Jeff Bailey : 2/16/2007 3:13:01 PM

03:00 Internals found at this Link

Jane Fox : 2/16/2007 3:06:41 PM

Remember I said today the VIX could be unreliable. Link

Jeff Bailey : 2/16/2007 3:02:35 PM

03:00 Market Watch found at this Link

Jeff Bailey : 2/16/2007 3:00:16 PM

YM 12,772

Jeff Bailey : 2/16/2007 2:59:57 PM

DIA $127.38

Jeff Bailey : 2/16/2007 2:59:16 PM

VXO.X alert ... 9.84 -0.40% ... session lows.

Jeff Bailey : 2/16/2007 2:58:46 PM

Dreyfus High Yield (DHF) $4.32 (unch) ... can't seem to find a NAV for it though.

Jeff Bailey : 2/16/2007 2:57:52 PM

Pacholder High Yield (PHF) $10.18 +0.59% ...

Jeff Bailey : 2/16/2007 2:57:28 PM

Not sure ER/RUT/IWM is tied with Treasuries at all. Rose when yields were rising, kept rising when yields reversed.

Jeff Bailey : 2/16/2007 2:48:29 PM

PG $65.02 +0.04% ...

Jeff Bailey : 2/16/2007 2:48:13 PM

JNJ $65.47 -0.48% ...

Jeff Bailey : 2/16/2007 2:47:54 PM

CAT $67.55 -0.10% ...

Keene Little : 2/16/2007 2:47:39 PM

Equivalent upside target for NQ is 1831.25 but gap close at 1830.50 could hold it down.

Jeff Bailey : 2/16/2007 2:47:38 PM

UTX $68.57 -0.52% ...

Jeff Bailey : 2/16/2007 2:47:18 PM

AIG $69.66 +0.78% ...

Jeff Bailey : 2/16/2007 2:47:00 PM

XOM $75.18 -0.21% ...

Jeff Bailey : 2/16/2007 2:46:45 PM

MMM $76.71 -0.26% ...

Jeff Bailey : 2/16/2007 2:46:29 PM

MO $85.94 -0.16% ...

Jeff Bailey : 2/16/2007 2:46:11 PM

BA $90.85 -0.93% ...

Jeff Bailey : 2/16/2007 2:45:34 PM

IBM $98.97 +0.05% ...

Jeff Bailey : 2/16/2007 2:44:03 PM

It's really a coin toss on the YM ... 12,773.

That action, if there is going to be any today, will be in the last hour of trade, with the bulk of Op-Ex risk to toward 12,800.

Keene Little : 2/16/2007 2:42:34 PM

I've often mentioned that the very short term charts are not always reliable when using EW but here will be a good test to see if the pattern finishes on NDX. The A-B-C bounce today needs a small push higher to finish wave-C. The final high can't exceed yesterday's otherwise it's not a wave-2 bounce as I have it labeled. Therefore if we get the bounce, short it and place your stop just above yesterday's high. That keeps risk very tight. Link

Jeff Bailey : 2/16/2007 2:38:21 PM

Those DAW-NX now show 3,243 contracts traded ... $0.55 x $0.60

Marc Eckelberry : 2/16/2007 2:30:57 PM

I agree with ER Jane, but I have figured out how to trade that one with safer stops, like NQ or YM. One thbg for sure: when TNX drops, just buy and hold ER. Hardly ever fails these days...

Keene Little : 2/16/2007 2:19:39 PM

The upside risk is to gap close ES 1459.75. I'll take that risk:reward every day of the week.

Keene Little : 2/16/2007 2:18:32 PM

Two equal legs up in today's bounce in SPX is at 1455.59 (ES 1459), right on top of the 62% retracement of this morning's spike down. Watch that level for a short entry.

Jane Fox : 2/16/2007 2:13:20 PM

Of course I say that very thing about the currencies markets so I guess I should just shut up.

Jane Fox : 2/16/2007 2:12:51 PM

I often wonder when traders say they don't like trading ER because of its volatility. Isn't that what we like in a daytrading vehicle. I for one prefer it to any other.

Jane Fox : 2/16/2007 2:11:30 PM

And the market you should use is ER

Jane Fox : 2/16/2007 2:11:15 PM

AD line is now a balmy -321 and AD volume although still under 0 is making new daily highs. The only trade if you must is long.

Jane Fox : 2/16/2007 2:09:31 PM

TICKS +1000

Marc Eckelberry : 2/16/2007 1:58:22 PM

They are going to hold 12764 today, but it could crack next week, since this seems artificial. Looks like they want to get as close to DOW 12750 as they can.

Jeff Bailey : 2/16/2007 1:54:17 PM

DIA 127.36

Jeff Bailey : 2/16/2007 1:54:03 PM

YM 12,767

Jeff Bailey : 2/16/2007 1:53:45 PM

VXO.X 9.94 +0.60% ... session lows and slips under its DAILY Pivot. YM shorts get a little jittery here.

Marc Eckelberry : 2/16/2007 1:53:02 PM

Infaltion adjusted, the current minimum wage is probably under 4 an hour compared to 1995. I know of no one being paid under 4 an hour 10 years ago. It is patently insane.

Jeff Bailey : 2/16/2007 1:51:39 PM

In the DIA options, the OPPORTUNITY RISK is in the DAW-NX, or the $128.00 Puts.

Marc Eckelberry : 2/16/2007 1:50:33 PM

We have a rising core and people are even DEBATING about raising the minimum wage for the first time in 10 years? Somebody pinch me.

Jeff Bailey : 2/16/2007 1:50:23 PM

DIA Options Montage with Level II for DAW-BW and DAW-NX Link

Marc Eckelberry : 2/16/2007 1:49:22 PM

OIl is back at 59 (contract rotation, March expires Monday). So let me get this right: PPI moderates on lower energy, but now energy has come up 15% since. Core keeps creeping up, but housing starts are are there lowest since 1995, nor even population rise adjusted. We have slower growth and inflation, no matter how mild. This is called stagflation, why is everyone talking about mild inflation? Core above 2 is real inflation, no matter what way you slice it.

Marc Eckelberry : 2/16/2007 1:45:30 PM

If YM loses 12764, it will trigger a wave of selling.

Keene Little : 2/16/2007 1:44:46 PM

Short term support for the DOW will be at the trend line along the highs from January 3rd, currently near 12738, about 8 points lower. We've got a lazy opex Friday here and I'm not sure it's going to amount to much in either direction but the setup remains for an afternoon sell off. But if the bulls manage to hang on here then I see the possibility for another bounce back up to 12760-12770 to give the day the appearance of just another consolidation day. It would then be Tuesday before we could expect the selling to kick into gear. Link

Marc Eckelberry : 2/16/2007 1:42:20 PM

If YM closes below 12785/12793, it is a hold over the weekend.

Marc Eckelberry : 2/16/2007 1:41:47 PM

Speaking of markets, it looks like bulls can't get out of bed, even with option pinning. In fact, one could argue we would have had a 100 point drop in the DOW if today was not opex Friday.

Marc Eckelberry : 2/16/2007 1:40:59 PM

This is market relevant by the way.

Jeff Bailey : 2/16/2007 1:39:12 PM

If my eyeballs are working ... DIA option action sure hints at a $127.25 close.

Marc Eckelberry : 2/16/2007 1:39:37 PM

Yes, I'm an Eisenhower capitalist, not this new breed that is out of touch (and has never even opened a history book and avoided the draft: what kind of a man does not serve his country when called).

Keene Little : 2/16/2007 1:25:41 PM

Here's the update to the CME road map. I'm trying to put both bullish and bearish counts on the same charts but that might make it more confusing. Let me know (at Support) if you prefer one chart with both the bullish and bearish wave counts or a separate chart for each. I know some of you like to print out the charts and I'm trying to save trees and your ink supplies (wink). Link

The way CME is chopping up and down I'm getting a stronger and stronger sense that it's going to consolidate before heading higher again. It could even do it right from here but not if the broader market is ready for a pullback. If CME rallies above 589 (the key level for the bullish count) then I suspect the broader market will also be making new highs.

Assuming we get more of a pullback the support levels will be near 555 and then the uptrend line near the Fib projection at 539. It takes a break below 535 to put the bears in control and you can bet we'd then see CME close its gap at 509 that was left on January 3rd.

Marc Eckelberry : 2/16/2007 1:25:16 PM

Students of history know that the total disregard for the working class of the industrial revolution in England, where workers were not allowed to organize and were paid slave wages, laid the foundation for Das Kapital and is directly responsible for the rise of communism in the 20th century. If you don't pay your working class a decent wage, you get revolutions and then, you can forget about a free society.

Jeff Bailey : 2/16/2007 1:25:31 PM

What to do... what to do.

TLT $88.62 +0.32% and those TLT-BJ show bidder up at $0.65 x $0.70, TLT-CJ $1.05 x $1.15.

Jeff Bailey : 2/16/2007 1:21:09 PM

01:00 Internals found at this Link

Jane Fox : 2/16/2007 1:11:44 PM

4. Forget about a regular shower head -- Kohler is selling a shower experience. The DTV Custom Showering Experience allows homeowners to personalize their shower through a panel that resembles an iPod, mounted on the bathroom wall. Homeowners can angle numerous shower heads and adjust the temperature to their liking, and then save the scheme for future showers. The digital interface for the shower system starts at about $1,039; the six-port thermostatic valve starts at about $1,102. Link

Jane Fox : 2/16/2007 1:11:04 PM

3. How about an oven that can take instructions over the Internet? The Connect IO Intelligent Oven from TMIO is so smart it can keep your roast cool all morning and then cook it to perfection once you tell it to start from work or wherever. It has "cook now" or "cook later" modes, and also operates as a fast-cooking convection oven. Not sure it's behaving while you're away? The oven will e-mail you once it starts heating your dinner, telling you what time to be home. Link

Jane Fox : 2/16/2007 1:09:54 PM

2. TurboChef displayed a Speedcook oven that will cook a 12-pound turkey in 42 minutes instead of four hours, and will shave an hour off the time it takes to bake an apple-cranberry pie. In addition to its speedy performance, the oven's brightly colored doors in hues including red, orange and blue set it apart in a sea of stainless steel appliances. The 30-inch oven has a manufacturer's suggested retail price of $7,495. Link

Jane Fox : 2/16/2007 1:09:15 PM

1. A swipe of a finger opens the Kwikset biometric scanning deadbolt, displayed at the show. The fingerprints of 50 users can be stored in the device that operates on four double-A batteries and will sell for about $200. Select Home Depot stores in New York, Orlando and San Diego are selling them already; the lock will be available at home retailers nationwide in June. Link

Jane Fox : 2/16/2007 1:09:03 PM

ORLANDO, Fla. (MarketWatch) -- Those who walked the exhibit halls at the International Builders' Show in Orlando last week had the opportunity to glimpse a plethora of the latest in home products, enough glitzy displays to make owners of even the most modern houses envious. (I will list them here since we don't have much else going on today).

Marc Eckelberry : 2/16/2007 1:16:19 PM

Not even Wallmart pays the current Federal minimum wage. Raising the minimum is a symbolic gesture, but it sends the right message to our working class. There is a segment of the population, especially in Southern States , that are still working at current Federal minimum wage and they are begging for that 50 cent hike (it will be a gradual move anyway), as they are literally living below the poverty line. They are hard workers and deserve it. At least they are not on welfare. If you can't pay a worker 7 bucks an hour, you should do something else than running a business with employees, because you are either an avaricious hog or completely incompetent. Congress keeps passing pay raises, but to leave the minimum wage at 1997 levels is a shocking way of thinking, even for the most die hard Miltonians. States that have raised their minimum wages, such as California (7.75) are doing just fine. I am a firm believer that a capitalist society can only survive if it rewards its worker with a decent wage. And it all comes back into the economy anyway and helps alleviate the welfare problem. Not to mention starving kids in our country (15 million to date per census). I am probably the only one on this monitor that has run a business with many employees (a factory) and I can tell you that I had no problem paying my men a good wage. But I also saw lots of scumbags using slave labor and I applaud the minimum wage hike,. Academics might not, but they don't live in the real world and they never even tried to live on 5 bucks an hour. If Wall street is against it, then they should agree to get higher taxes on those monstrous bonuses and help fund the welfare system. Because if you don't pay workers a decent wage, you end up with mothers on welfare. Period. I mean, how low can we get? Eisenhower himself would be shocked. He protected unions and proper wages.

Jeff Bailey : 2/16/2007 1:02:58 PM

01:00 Market Watch found at this Link

Keene Little : 2/16/2007 12:59:22 PM

If the bounce in GOOG from Monday's low to Wednesday's high is a good indication, the bounce off the top of its gap this week is so far a corrective bounce. That should be our heads up that GOOG is going to break down into its gap. The more immediate question is how high the current bounce will get. With it pushing higher today I'm now looking for where it will have two equal legs up from Monday's low, and then where the 2nd leg up will = 162% of the 1st leg up. Both are shown on this chart: Link

Two equal legs up is at 474 which is just shy of a 38% retracement of the decline from the January high. At 162% for the 2nd leg, at 483.55, it would be on top of the 50% retracement so those make two good potential upside targets for the bounce. But after that we should see GOOG turn back down and break below 450. I can't say I'm happy with the downside wave count from the January high (wave-(iv) is very small compared to wave-(ii)) but I've noticed that GOOG doesn't always look "pretty" with its counts.

Part of the "ugliness" of the downside count could be because it's a corrective pullback and not as labeled in red. Not shown on this chart is the bullish count which calls for continued support at 450 or the uptrend line near 440 and then a continuation back up to the highs from there. I show the key level at 450 but in reality GOOG needs to break its uptrend line in order to put the bears in the driver's seat.

Jeff Bailey : 2/16/2007 12:50:45 PM

DJ- Nymex Crude Tops $59.00; Nigeria Threat

Jeff Bailey : 2/16/2007 12:49:19 PM

From a free market perspective ... I sure hope that the minimum wage bill does not go through.

Someday, the economy will once again slow down and employers forced to pay a higher minimum wage will then downsize some employees, in order to offset a mandatory minimum wage.

When Republicans had control of Senate and House, they should have abolished minimum wage in my opinion.

Jeff Bailey : 2/16/2007 12:38:00 PM

General Motors (GM) alert! $36.73 +0.79% ... BIIIIG reversal here and takes out yesterday's high!

Jeff Bailey : 2/16/2007 12:35:49 PM

Credit Suisse A Commodity Bull

DJ- Despite negative sentiment in the marketplace, analysts at Credit Suisse say the commodities super-cycle is not over and that over the medium-term, commodities will provide higher returns than the consensus forecast.

Jeff Bailey : 2/16/2007 12:34:21 PM

EXTRA CREDIT: Buyouts Driving Commercial Mortgage Bonds

DJ- Commercial mortgage bond issuance is expected to grow by more than 50% in the first quarter 2007 to more than $70 billion, with leveraged buyout financing playing a major role as groups sell securities to fund acquisitions.

Keene Little : 2/16/2007 12:33:30 PM

It's a similar looking chart for the RUT as well. Depending on the kind of pullback we get we'll know more about what's next. It's possible the RUT hasn't quite finished putting in a high for now so I show the possibility for a brief push higher before starting down but if the broader market starts its pullback from here then it's quite likely the RUT will as well. A break below 802 says the rally is over. A push back through 818, especially after a larger pullback, should have you flat or trying the long side. Link

Jeff Bailey : 2/16/2007 12:31:51 PM

New Century Financial (NEW) $19.11 +1.75% ... session low has been smack on my 19.1% retracement.

Jeff Bailey : 2/16/2007 12:30:57 PM

HSBC (HBC) $89.40 -0.30% .... battles back.

Jeff Bailey : 2/16/2007 12:27:30 PM

UNH $54.03 +0.78% Link ... stock surged yesterday on that news. HMO.X 1,936.86 +0.19% Link ... also up strong yesterday.

Jeff Bailey : 2/16/2007 12:23:20 PM

Buffett Company Buys UnitedHealth Stake ... AP Story Link

Jeff Bailey : 2/16/2007 12:19:19 PM

GOODYEAR 4Q LOSS WIDENS ON STRIKE EFFECTS

DJ- Tire maker posts net loss of $358 million, or $2.02 a share, as 12-week strike cost it $367 million. Revenue rises nearly 1% to $4.98 billion. Excluding items, it earns 22c a share. Analysts expected a loss of 40c a share.

GT $25.02 -1.53% Link ...

Marc Eckelberry : 2/16/2007 12:13:06 PM

Alert: YM short 12801, keep stop at even, but cancel sell to close. If we head lower, we will just lower stops, in case that was the top.

Jeff Bailey : 2/16/2007 12:12:38 PM

DELL CEO SAYS WILL TAKE 18 MONTHS TO IMPROVE

DJ- Michael Dell thinks it will take 18 months for the company to turn around, BusinessWeek reports, adding he plans to expand its services, do more in emerging markets and launch a new product in China in a few weeks.

DELL $24.40 +0.08% Link ...

Marc Eckelberry : 2/16/2007 12:12:09 PM

The only group up in the spiders is consumer staples. That means the market is thinking slowdown or even recesssion.

Jeff Bailey : 2/16/2007 12:10:54 PM

Exxon/Mobil (XOM) $75.29 -0.06% ...

Jeff Bailey : 2/16/2007 12:10:03 PM

TREASURY OFFICIAL SEES GOOD GLOBAL ECONOMY

DJ- World economy is on course for another good year after 4 years of robust growth, but in longer-term it would benefit from completion of latest round of WTO talks, Treasury Undersecretary for International Affairs Timothy Adams says.

Jeff Bailey : 2/16/2007 12:07:25 PM

EIA: US 2006 Crude Imports From Top-Ranked Canada +9.1% On Year.

Jeff Bailey : 2/16/2007 12:06:45 PM

EIA: US 2006 Crude Oil Imports 10.095M B/D, -0.3% Vs. Year Ago

Keene Little : 2/16/2007 12:06:44 PM

The pattern for SPX continues to look similar to the one for the DOW. Again, assuming we start a pullback it will be the form of the pullback that should give us some clues as to whether or not we've topped out. There is a potential turn window in mid March and therefore the bullish possibility shown on this chart needs to be considered seriously. Link

If we get a pullback over the next week or two that is an overlapping choppy affair that works its way down/over to the bottom of its wedge then I would expect another leg up to a new high in March. But if the decline becomes impulsive, and especially if it drops below 1431, then the fat lady will have sung and we'll be into a new bear market.

Jeff Bailey : 2/16/2007 12:05:57 PM

EIA: US December Crude Oil Imports -2.6% Vs. November; -4.1% Vs. Year Ago

Jeff Bailey : 2/16/2007 12:05:12 PM

EIA: US December Crude Oil Imports 9.584M B/D; Lowest Since Oct '05

Jeff Bailey : 2/16/2007 12:01:43 PM

sure "looks" like DCX intra-day, or starting to.

Jeff Bailey : 2/16/2007 12:00:51 PM

iShares Germany (AMEX:EWG) $28.41 -0.17% ....

Marc Eckelberry : 2/16/2007 11:59:51 AM

Wow. ISEE spiked up to 199 and cboe equity pc ratio at .50. That is a huge turnaround in sentiment, now excessively bullish.

Jeff Bailey : 2/16/2007 11:57:57 AM

Where's my currency converter when I need it?

Jeff Bailey : 2/16/2007 11:57:43 AM

Germany's DAX 6,957 ... off 1.5 points. Link ... when DCX was trading 54.12

Jeff Bailey : 2/16/2007 11:54:49 AM

DCX $74.00 +5.43% now ...

Jeff Bailey : 2/16/2007 11:50:55 AM

YM 12,771 ... quiet as a church mouse.

Jeff Bailey : 2/16/2007 11:50:00 AM

Incredible volume in GM last 25-minutes.

GM $36.35 -0.24% ...

Jeff Bailey : 2/16/2007 11:41:07 AM

Nissan Motor (NSANY) $23.37 -0.46% ...

Jeff Bailey : 2/16/2007 11:40:26 AM

Ford Motor (F) $8.63 +0.34% ...

Jeff Bailey : 2/16/2007 11:40:03 AM

Toyota Motor (TM) $136.66 -0.08% ...

Jane Fox : 2/16/2007 11:39:04 AM

HOUSTON (MarketWatch) -- Rising natural-gas prices and merger and acquisition talk lifted the exploration and production sector, while shares of major oil companies largely ignored higher commodity prices.

The Amex Oil Index (XOI) was off 0.3% to 1,159.76 points as crude for March delivery rose 51 cents to $58.50 a barrel. The Philadelphia Oil Services Index ($OSX) slipped 0.2% to 196.16 points.

The Amex Natural Gas Index (XNG) added 0.3% to 457.51 points. Leading the index forward, Pogo Producing Co. (PPP) was up 2.8% to $52.01, pulling back from gains of over 4% at the start of the trading session.

Jeff Bailey : 2/16/2007 11:36:42 AM

Qualcomm (QCOM) $41.96 +1.54% ... breaking out of a nice 7.5-month base.

Jeff Bailey : 2/16/2007 11:35:00 AM

GM $35.87 -1.59% ...

DCX $71.00 +1.09% ...

Jeff Bailey : 2/16/2007 11:33:45 AM

CNBC reporting: ... GM in talks to buy DCX.

Keene Little : 2/16/2007 11:26:43 AM

MER is making new lows.

Jeff Bailey : 2/16/2007 11:26:25 AM

GM's March "Max Pain" theory currently tabulated at $35 ($2.50 increments)

Will likely be plenty of buyers on any type of backfill of recent 02/09/07 gap up.

Jeff Bailey : 2/16/2007 11:23:11 AM

General Motors (GM) $36.32 -0.32% ... traders long the stock may want to take profits off the table. 9 days since stock has broken below a prior day's low.

Keene Little : 2/16/2007 11:22:57 AM

So far the bounce on SPX is just a 3-wave correction. It could turn into a higher correction but being short the market I like the way it looks so far--impulsive spike down followed by a corrective bounce. This should continue lower. The risk for new entries today is back to yesterday's high.

Jane Fox : 2/16/2007 11:21:41 AM

BOSTON (MarketWatch) -- Mutual-fund giant Fidelity Investments said Friday its total revenue in 2006 rose to $12.87 billion from $11.12 billion the previous year, as assets under management climbed to $1.384 trillion from $1.208 trillion. The Boston-based company said net income dropped to $1.18 billion from $1.33 billion on several factors including rising headcount to service growing businesses and support initiatives, increases in advertising and special charges. Fidelity said it ended 2006 with nearly $3 trillion in administered assets, up 19% from the previous year.

Jane Fox : 2/16/2007 11:21:21 AM

BOSTON (MarketWatch) -- NYSE Group Inc. (NYX) said Friday that 16 iShares exchange-traded funds from Barclays Global Investors moved their primary listing from the American Stock Exchange to the Big Board as part of a previously announced deal. The NYSE said it has 165 primary ETF listings and handled 43% of all ETF shares traded in the U.S. market in 2006. So far in 2007, the exchange said it has listed 30 new ETFs.

Keene Little : 2/16/2007 11:20:32 AM

I'm not seeing anything here that tells me to be long. But the short side is not exactly a winner either. Bears might have to wait until next week. But fear of the long weekend might induce some profit taking later. We'll just have to wait and see.

Marc Eckelberry : 2/16/2007 11:19:02 AM

Which is what I am going to do.

Marc Eckelberry : 2/16/2007 11:18:50 AM

NQ dropped out of the gap (1824.25). Another plus for bears, but this volatility is screaming go do something else than stare at your screen.

Marc Eckelberry : 2/16/2007 11:16:30 AM

Bulls need to close ES above 1457.75 if they want any traction next week. Bears need to see a close below.

Jeff Bailey : 2/16/2007 11:14:43 AM

11:00 Internals found at this Link

Marc Eckelberry : 2/16/2007 11:12:23 AM

They pushed it up to 61.8% at 12779 and backed off. Bears are still in control below 12779. But ES and NQ are in their gaps and are trying hard to go up and close them., If you are sick of watching this, close out the short for +25.

Marc Eckelberry : 2/16/2007 11:10:44 AM

Alert: YM short 12801, lower stop to even. Conservative traders, lower to 12794. If we don't get stopped out, hold over the weekend, target is still 12736.

Jane Fox : 2/16/2007 11:10:21 AM

What a shameless plug for Mike, our resident Couch Potato.

Jane Fox : 2/16/2007 11:09:55 AM

However, for those of you (us) who partake in Mike Parnos's Iron Condors this has been a profitable month. 48 out 51 now.

Jane Fox : 2/16/2007 11:08:41 AM

AD line as "improved" to -703 and this is telling you don't even think long. So this once again leads us back to my original thought, "This is going to be a long day."

Jane Fox : 2/16/2007 11:07:17 AM

VIX to new daily lows so if you are still short this is telling you "Get out of Dodge."

Jeff Bailey : 2/16/2007 11:02:16 AM

11:00 Market Watch found at this Link

Jeff Bailey : 2/16/2007 10:55:21 AM

YM short stop alert 12,778

Marc Eckelberry : 2/16/2007 10:53:11 AM

Trading remains fairly technical, even though opex is doing its thing. They will probably come in closer to the close. YM is finding resistance at 50% today, 12776. S1 is 12764 which s also monthly R1, hence all the support there. We might not breach that low today, but if we do, it will be a quick trip down.

Jane Fox : 2/16/2007 10:49:56 AM

VIX is now testing its daily lows which is quite bullish.

Jane Fox : 2/16/2007 10:49:04 AM

TICKS +800

Jeff Bailey : 2/16/2007 10:47:40 AM

VXO.X 10.15 +2.73% ... I'd say VERY slightly more put buying/call selling than put selling/call buying.

IF VXO.X were to "spike lower" then we're looking hard at DIA $128.00

Jane Fox : 2/16/2007 10:45:53 AM

AD line is -1018 and AD volume to new daily highs. But that VIX is still not budging and should make any decline muted at the best. Just not a good environment to be trading - yet.

Jeff Bailey : 2/16/2007 10:45:52 AM

DIA $127.34

Jeff Bailey : 2/16/2007 10:45:23 AM

YM short lower stop alert ... to 12,778

YM 12,767

Jeff Bailey : 2/16/2007 10:43:03 AM

Hmmm .... DIA Put/Call OI at the $128.00 almost extactly a match 7,466/7,459 ... $127 strike put/call OI 9,795/2,702

Jane Fox : 2/16/2007 10:34:13 AM

SAN FRANCISCO (MarketWatch) -- A credit crunch in the market for low-end mortgages has left companies specializing in these subprime loans at the mercy of big banks like Merrill Lynch & Co. and J.P. Morgan Chase.

Several private subprime lenders, such as Ownit Mortgage Solutions, Mortgage Lenders Network USA and ResMAE Mortgage Corp., have already filed for bankruptcy protection after having financial lifelines cut by Merrill and other big banks. The fate of other publicly traded subprime specialists, such as New Century , Novastar Financial and Fieldstone Investment, may also rest in the hands of big banks that have helped finance their recent rapid expansion, analysts said.

Subprime mortgages are offered to home buyers who fail to meet the strictest lending standards. While these loans remain a small part of the home lending industry, they've helped more people buy homes who previously couldn't afford it, helping to fuel a surge in housing prices in 2004 and 2005.

Jane Fox : 2/16/2007 10:32:33 AM

WASHINGTON (MarketWatch) - U.S. consumer sentiment eroded in February after hitting a two-year high the previous month, according to research at the University of Michigan on Friday.

The UMich consumer sentiment index dropped to 93.3 points in February, after jumping to 96.9 in January from 91.7 in the last month of 2006, according to Reuters, which has an arrangement to publish the index.

The decline in February was larger than expected. According to a survey conducted by MarketWatch, economists had expected the index to slip to 96.2.

Jeff Bailey : 2/16/2007 10:31:23 AM

Baker Hughes (BHI) $64.83 -0.55% .... testing MONTHLY S1.

Marc Eckelberry : 2/16/2007 10:31:04 AM

Alert YM short 12801,leave stop at 12811 (conservative traders should lower to even, but R1 is at 12807) Buy to close at 12736, GTC.


Jeff Bailey : 2/16/2007 10:30:44 AM

DIA $127.37 ... YM 12,771

Keene Little : 2/16/2007 10:29:46 AM

I'm back up to speed. This is an updated DOW chart showing two potential wave counts. Like the NDX chart it looks like we're ready for a pullback and we'll have to wait to see what comes of it. My preferred count is the bearish count based on the longer term wave count but the challenge remains identifying which move up to the top of its ascending wedge is the last one. Link

Any move directly from here above 12805 puts it on a possible path to 12900 so I would use that level as a stop level for longer term short positions. If I draw in a parallel up-channel for price action since November then the top of that channel is currently above 12900.

Jeff Bailey : 2/16/2007 10:28:51 AM

VXO.X 10.32 +4.45% ... its WEEKLY Pivot is 10.70.

Jane Fox : 2/16/2007 10:28:51 AM

TICKS favor the bulls and have printed mostly above 0 all day. Shorts beware.

Jeff Bailey : 2/16/2007 10:27:15 AM

Dow Diamonds (DIA) 5-minute interval chart at this Link ... for a YM day trader's short, need DIA to break DAILY S2, then further weakness toward's $127.00 strike.

Jane Fox : 2/16/2007 10:27:12 AM

I am certainly not bullish but the VIX is telling me to not get overly bearish either.

Marc Eckelberry : 2/16/2007 10:27:07 AM

I consider a rise in equity put to call while we rally like this to be a very bullish sign. That is why shorts are not working very well or for long, there are just too many out there. When we see ISEEE above 200 on a close, then think sell and hold. I am a contrarian when it comes to equity pc ratios, unlike Larry. I am a very nervous short today.

Jane Fox : 2/16/2007 10:25:24 AM

Opps did you all see NQ make a new daily HIGH!

Jane Fox : 2/16/2007 10:22:13 AM

I will not take a long because the AD volume is making new daily lows. So I am "Stuck In the middle."

Marc Eckelberry : 2/16/2007 10:22:08 AM

How can you make money daytrading with this pitiful volatility. Are we ever going to get bakc to +20 VIX? Even on a nice bull market, you should get 80 point down swings with YM intraday. This is the worst trading market I have ever seen. It favors "dumb" buy and hold.

Jane Fox : 2/16/2007 10:21:09 AM

I will not try a short position until I see the VIX more bearish than it is right now.

Jane Fox : 2/16/2007 10:18:22 AM

McMillan's weekly update. - Some cynics say that it's the market's "job" to behave in a manner so that it maximizes the number of losing traders at any one point in time. The recent market movements certainly seem to fit in that view, at least for the short-term. The last two advances to new 6+-year highs by $SPX have been met, not with bullish follow-through, but a sharp correction instead. But, as soon as the correction seems to gain momentum, the market bolts to higher highs once again. On one hand, option traders should welcome this sort of action, for it raises actual volatility. On the other hand, it can be frustrating -- especially if one is attempting to trade short-term market movements.

The latest move to new highs (yesterday) seems to fit in this pattern. The technical indicators are not enthusiastic about the move, and in fact some sell signals have set up.

But let's begin at the beginning -- and that's with the chart of $SPX. It's still in a bullish uptrend, even though the steepest uptrend line has been slightly violated. This market is still very reminiscent of the 1995 bull market, which continued higher in a more volatile manner after its tight uptrend was broken. From a longer-term perspective, then, wewould expect this market to do the same -- perhaps continuing higher until late this year.

In the meantime, though, some negative signs have arisen. Perhaps the most surprising of which is that the equity-only put-call ratios have rolled over to sell signals rather abruptly. The charts are shown in Figures 2 & 3 (note: the standard chart now shows the "dividend-adjusted" data, having thrown out the irrelevant dividend arbitrage volume).

Market breadth has been very positive this year. The market can certainly continue to rise while breadth is in overbought status, of course, but it does mean that a day or two of declines would throw breadth into a sell signal.

Finally, the volatility indices have plunged to near all-time lows again. While the market can theoretically continue to rise even while these indices are so low, it usually takes a breather when $VIX and/or $VXO dips below 10, as they did again yesterday.

In summary, the market is stair-stepping its way to the stars. The good news is that this sort of environment can produce increased volatility, which should improve one's ability to trade these broad market movements.

Jeff Bailey : 2/16/2007 10:16:17 AM

Dow Diamonds (DIA) $127.40 -0.28% (pinned at MONTHLY R1) ... February's "Max Pain" theory now $128.00 ($1 increments)

Jane Fox : 2/16/2007 10:12:21 AM

Although I did mention that the VIX is at its most unreliable today I would still keep and eye on it. And darn it anyway, it is hovering around daily lows and should make the bears just a tad nervous.

Keene Little : 2/16/2007 10:10:49 AM

I've lost my internet connection and am on backup (dial up) until I can get it resolved. I'm working on updating the road maps which will be delayed until I can my charts back but in the meantime here is the one for NDX that I had just finished. Link

Assuming we're now going to get a pullback the question is whether it will be just a pullback or the start of something more serious to the downside. My preferred count remains the bearish count but if a pullback is followed by another push higher above 1823 then the bullish count will move into the lead. Therefore any longer term short positions, including spreads, you may want to use that as your stop level.

Jane Fox : 2/16/2007 10:10:49 AM

AD line is -1000 and AD volume falling so the bears have the ball and field position. It is now sell the rallies.

Jane Fox : 2/16/2007 10:05:36 AM

Expect YM and NQ to find support at their PDL although I do think they will break eventually.

Jeff Bailey : 2/16/2007 10:04:42 AM

10:00 Market Watch found a this Link

Jeff Bailey : 2/16/2007 10:03:58 AM

New Century Financial (NEW) $19.01 +1.22% ...

Jeff Bailey : 2/16/2007 10:03:27 AM

HBC Holdings (HBC) $88.90 -0.85% ... new relative low.

Jeff Bailey : 2/16/2007 10:02:30 AM

YM short alert ... short the YM here at 12,771, stop 12,796 , target 12,720

Jane Fox : 2/16/2007 10:01:58 AM

YM and NQ have not yet broken their PDLs but I think they will.

Jane Fox : 2/16/2007 9:51:28 AM

This could be a very loooonnnngggg day.

Jane Fox : 2/16/2007 9:51:05 AM

Unforunately though I see no reason to be short either.

Jane Fox : 2/16/2007 9:50:45 AM

New daily lows across the board. Aren't you glad you didn't try a long this morning?

Jane Fox : 2/16/2007 9:45:43 AM

The VIX is falling but with an AD volume under 0 I will not use it to position myself long. TRIN as falling to 1.25 but still quite bearish. It looks like another day to just wait out.

Jane Fox : 2/16/2007 9:40:12 AM

ES's support zone has held on but the internals would have to turn around before I would go long.

Jane Fox : 2/16/2007 9:38:21 AM

TRIN 1.75 almost to 2.00.

Jane Fox : 2/16/2007 9:37:17 AM

VIX above its PDH.

Jane Fox : 2/16/2007 9:36:46 AM

EGADs TRIN is 1.54!

Jane Fox : 2/16/2007 9:36:26 AM

AD line is -402 and AD volume is below 0 but NOT falling. Mixed picture today.

Keene Little : 2/16/2007 9:35:32 AM

The SPX 5-min chart did in fact do a better job than the DOW chart in forecasting the next move. This shows the typical result out of an ascending wedge with a fast retracement of it. Think about the ascending wedge on the daily chart and we will probably see something similar. With this drop now, we should get a bounce off the botom of this pattern (1453) and then a continuation lower. Link

Jane Fox : 2/16/2007 9:35:29 AM

NQ is the first market to break its overnight low. So far ES's ON low is holding up.

Jane Fox : 2/16/2007 9:31:26 AM

ES opens at 1456.25 which just happens to be its PDL.

Jane Fox : 2/16/2007 9:30:24 AM

1456.00 is the number you should be watching on the ES chart.

Jane Fox : 2/16/2007 9:28:34 AM

The housing data are "dollar bearish" as it puts the "notion of housing stabilization at risk," said T.J. Marta, fixed-income strategist at RBC Capital Markets.

However, "housing starts are undoubtedly lower on weather as well as continued overhang of unsold new home inventories, so there's not a lot new there to provoke fresh dollar selling," said Brian Dolan, director of research at Forex.com.

Jane Fox : 2/16/2007 9:26:15 AM

Bonds rose overnight sinking yields after a weak housing report came out at 8:30 accompanied by a tame core PPI which is seen as giving an OK to the FED to cut rates again. Link

Jane Fox : 2/16/2007 9:20:23 AM

It was a bullish overnight session because of the higher highs. From what I can see on the ES chart there is a support zone at PDL and overnight lows and I would stay bullish above this support but below evaluate the internals to support a short position. Remember this is OPEX Friday and the VIX will be at its most unreliable :( Link

Keene Little : 2/16/2007 9:16:48 AM

After the close yesterday futures dropped sharply following the Mr. Softee's disappointing news but they rose steadily overnight back up to even before pulling back slightly since 8:00. That makes it questionable which way the market will try to head after the open. My guess is futures were pushed back up in hopes of getting a neutral open and an option settle price near yesterday's close. Once that happens then the market will be free to fall again.

Jane Fox : 2/16/2007 9:06:28 AM

(This updates an earlier version to indicate that wholesale prices fell 0.6%.)

WASHINGTON (MarketWatch) -- U.S. wholesale prices fell in January because of sharply lower energy prices, while core prices increased modestly, the Labor Department reported Friday. Wholesale prices fell 0.6% in January, after two sizable gains in November and December, as energy prices fell 4.6%.

The core producer price index -- which excludes food and energy prices -- rose 0.2% in January for the second consecutive month.

Jane Fox : 2/16/2007 8:57:55 AM

WASHINGTON (MarketWatch) - U.S. home builders started the fewest homes in nearly a decade in January, as housing starts plunged 14.3% to a seasonally adjusted annual rate of 1.408 million, the Commerce Department reported Friday.

It's the lowest rate for starts since August 1997. Housing starts were down 37.8% compared with January 2006.

Building permits dropped 2.8% to 1.568 million in January, 28.6% below the same month a year ago.

The starts figure was much lower than expected on Wall Street, where economists were looking for a 2% drop to 1.60 million annualized units. The permits figure was close to the 1.58 million expected by median forecast in the MarketWatch survey of economists.

The stunning drop in home building indicates that builders are scaling back their plans on a massive scale to work down the excess inventory of unsold homes on the market. Hopes that a bottom in the housing market has been reached will have to be re-evaluated.

Jane Fox : 2/16/2007 8:56:26 AM

WASHINGTON (MarketWatch) - U.S. wholesale prices fell in January on a drop in energy prices, while core prices increased modestly, the Labor Department reported Friday.

Wholesale energy prices fell 0.6% in January after two sizable gains in November and December.

The core producer price index - which excludes food and energy prices--rose 0.2% in January for the second consecutive month.

The drop in wholesale prices and the gain in the core rate were in line with the expectations of Wall Street economists surveyed by MarketWatch.

Marc Eckelberry : 2/16/2007 8:26:29 AM

The overnight moved everyone up, so I would ve careful. Conservative traders could exit and book profits, just in case. It seems they are holding up 12764 no matter what. Stop stays at 12811 and is not raised.

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