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Keene Little : 3/20/2007 12:32:47 AM

Would value your opinion on CME and how ICE will have impact on CME, thank you.

Here's a roadmap update on CME. The daily chart shows the bearish and bullish wave counts and I'm waiting for price to tell me which one is likely playing out. Price is currently threatening to break below its uptrend line from April 2005 so a continuation lower, especially with a break below its last low at 510 would be clearly bearish. Link

I show two bullish possibilities in green--dark green for a more immediate rally to new highs and the light green showing a potential sideways triangle forming before rallying in the final 5th wave to a new high. Looking a little closer, this 120-min chart shows how each could play out (I left off the light green sideways triangle idea but will add it in there if that looks to be setting up). Link

The bearish wave pattern calls for another leg down once the current small bounce finishes (it may have a little higher to go). I'm leaning more towards this bearish wave count than the bullish ones. It may or may not break below 510 before bouncing back up to test the broken uptrend line and then let go from there in a strong decline. But any push above 545.72, the low on March 14th, would suggest one of the bullish wave patterns is instead likely playing out.

As for what the news with ICE may do to this stock I really have no clue. I'm not sure many understand the potential ramifications from that. I'll just stick with the chart and let price tell me what the ramifications will be.

Jeff Bailey : 3/20/2007 12:21:25 AM

YM up 3 points, or +0.02% at 12,332.

Jeff Bailey : 3/20/2007 12:20:44 AM

Nikkei-225 ($NIKK) Link ... currently up 156 points, or +0.92% at 17,165.89.

Session high/low has been 17,267 / 17,147.

Jeff Bailey : 3/20/2007 12:16:58 AM

BOJ's Board Votes to Leave Monetary Policy Unchanged

DJ- Bank of Japan board members Tuesday voted unanimously to leave monetary policy steady, in line with indications from the central bank that it wouldn't immediately follow a rate rise in February with a further policy tightening.

Analysts expect the BOJ to raise interest rates further but not until economic data show domestic demand is picking up and price pressures increase after moderating due to a recent fall in global oil prices.

With the meeting result as expected, the focus will center on whether BOJ Governor Toshihiko Fukui at his press conference from 0630 GMT is less optimistic toward Japan's economic recovery, and by implication toward further policy tightening, following recent financial market volatility.

Following the two-day meeting, the BOJ left unchanged its guideline for money market operations, saying it will "encourage the uncollateralized overnight call rate to remain at around 0.50%."

The central bank also left unchanged its monthly purchases of government bonds at Y1.2 trillion.

The BOJ board on Feb. 21 raised its policy interest rate to 0.50% from 0.25% - the first hike since July.

Analysts and financial market traders also say that the BOJ would likely face significant opposition from the government if it wanted to raise rates before Upper House elections in July.

Japan's core CPI was unchanged in January from a year-earlier, which was the first flat result since May 2006. Economists expect on-year changes in Japan's core CPI in February to fall slightly due to the drop in crude oil prices.

Markets are focusing on Governor Toshihiko Fukui's possible comments on future rate hikes and the economy after the weak CPI and the recent volatility in financial markets at a post-meeting news conference at 0630 GMT.

People close to the BOJ said ahead of the meeting that the board members would likely discuss the impact of recent volatile stock and foreign exchange markets on the Japanese economy.

The next policy setting meeting is scheduled for April 9-10, on the heels of the release of the BOJ's tankan corporate sentiment survey on April 2.

Jeff Bailey : 3/20/2007 12:04:17 AM

USD/JPY 117.82 +0.26% ...

Jeff Bailey : 3/20/2007 12:00:11 AM

Bank of Japan Leaves Rates Unchanged at 0.50%.

Keene Little : 3/19/2007 11:30:03 PM

Tuesday's pivot tables: Link and Link

OI Technical Staff : 3/19/2007 10:00:00 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

Disclaimer: Stocks discussed in the Market Monitor are for educational purposes only and any analysis is not meant to imply a recommendation for or against that stock. The analysts in this forum as on any other website are prohibited by the SEC from giving any specific advice to ANY individual trader. All information posted is for ALL readers and is not meant to be directed to any individual. Our analysts cannot answer any email questions regarding any specific stock. Please do not ask and please do not take offense if requests are denied.

Results posted in the Market Monitor are hypothetical and OIN does not claim that any reader achieved these exact results. Due to the lag time between research, writing, posting, uploading, reading and execution there will be differences between the actual signal given and the fill achieved by the reader. Fills may be better or worse but in most cases they will be different. The writers will make every effort to give advance notice of intended signals and indicate potential price targets. Your individual results may vary depending on your activity level and aggressiveness. This forum is intended as an education service only. Trading involves risk and should not be attempted by anyone not ready to accept this risk. By acting on any signal in this forum you agree and personally accept this risk.

Jeff Bailey : 3/19/2007 5:57:10 PM

USD/JPY went out at 117.51. Up 0.81, or +0.69% from Friday's final tick of 116.70.

Sunday's early low was 116.24. Today's session high was 117.76.

Jeff Bailey : 3/19/2007 5:49:00 PM

Closing U.S. Market Watch found at this Link

Note: Those 5-dayNet% in blue have been checked/edited for correctness.

Jeff Bailey : 3/19/2007 5:06:44 PM

Closing Internals found at this Link

Keene Little : 3/19/2007 4:02:12 PM

I received a couple of requests for the browser refresh program so I'll get that off to you today. I've got to run out promptly at 4:15 so I'll get that done as soon as I return.

Jeff Bailey : 3/19/2007 4:00:47 PM

ABN Amro (ABN) $41.36 +14.12% ...

Jeff Bailey : 3/19/2007 4:00:03 PM

ABN Amro Confirms Exploratory Talks With Barclays

Keene Little : 3/19/2007 3:52:58 PM

I'm one of the ones who has to use the browser version of the MM because the standalone version doesn't update for me. If you also use the browser version I have a neat little program that you can install and it enables you to set automatic refresh at whatever interval you'd like to use (it's called Yrefresh). Email me if you'd like a copy (at Support).

Jane Fox : 3/19/2007 3:52:36 PM

NEW YORK (MarketWatch) -- CBOT Holdings Inc., the parent of the Chicago Board of Trade, ended several days of silence Monday in saying its board had authorized talks with InterContinental Exchange, the Atlanta-based company that made a surprise bid for the company last week.

InterContinental, known as ICE (ICE) , earlier Monday formally delivered its offer to CBOT (BOT) , which had a previous pact to merge with crosstown rival CME Holdings (CME) , which runs the Chicago Mercantile Exchange.

IntercontinentalExchange shook up the exchange group last Thursday, aggressively bidding to disrupt the CME deal, which would give rise to the world's largest agricultural-commodities and financial-derivatives exchange. The upstart electronic commodities-trading-platform operator ICE said it had entered an unsolicited bid to merge with CBOT in a deal valued at nearly $10 billion

Jeff Bailey : 3/19/2007 3:48:31 PM

April Unleaded (rb07j) settled up $0.0510, or +2.67% at $1.9581.

May Unleaded (rb07k) settled up $0.0290, or +1.55% at $1.8991.

Keene Little : 3/19/2007 3:48:30 PM

It's not looking so good for even a measely target of 1770 for my NQ short. Stop lowered to 1777 to pay for smaller lunch, sniff...

Jane Fox : 3/19/2007 3:45:50 PM

I still can't get my downloaded version of the MM to work. Just to add a note to Keene's 3:38 post. The browser version requires a refresh (F5) before you see new posts. Pain in the tutu but it works.

Marc Eckelberry : 3/19/2007 3:45:40 PM

1771.50 is also 50% today and close to gap open.

Marc Eckelberry : 3/19/2007 3:44:20 PM

NQ 1772.25 R1 held and I'm flat.

Jane Fox : 3/19/2007 3:42:44 PM

Keene I agree.

Keene Little : 3/19/2007 3:41:21 PM

There's very little question in my mind that the sideways consolidation in SPX and DOW are going to resolve to the upside. Looks like a rally setting up for tomorrow.

Jeff Bailey : 3/19/2007 3:39:38 PM

April Crude Oil (cl07j) settled down $0.52, or -0.91% at $56.59.

May Crude Oil (cl07k) settled up $0.12, or +0.20 at $59.70.

Keene Little : 3/19/2007 3:38:50 PM

Is there some other way to sign on to Market Monitor or something different than the stand alone version as you mention?

Hopefully most of you are now up and running on the standalone version. For the future, if you have trouble with that java version you can go to the OptionInvestor home page and select Market Monitor from there.

Jane Fox : 3/19/2007 3:37:56 PM

Bank of America Corp. (BAC) disclosed Monday that Chairman and Chief Executive Kenneth D. Lewis received a total pay package for 2006 valued at $27.9 million.

Lewis' pay package included restricted stock awards valued at $11.7 million, option awards valued at $5 million, incentive compensation valued at $6.5 million, a $3 million increase in the value of his pension and $1.5 million in salary, according to the company's proxy statement filed with the Securities and Exchange Commission

Jane Fox : 3/19/2007 3:37:18 PM

SAN FRANCISCO (MarketWatch) -- Crude-oil futures closed under $57 a barrel Monday for the first time in seven weeks, following a brief recovery that had lifted prices by almost 1%, as concerns over the potential for a slowdown in energy demand flared up in the wake of China's interest-rate increase.

Prices had recovered briefly during the session, peaking at a gain of almost 1%, but the energy-demand concerns outweighed the earlier support from strength in the U.S. stock market and an increase of as much as 3% in reformulated-gasoline prices.

"News that China has raised interest rates will raise the specter of global economic slowdown again," said Michael Fitzpatrick, analyst at Fimat USA, in a note to clients. "The fear is that problems in the housing and mortgage area will spill over into other sectors -- eventually dampening demand for oil."

Keene Little : 3/19/2007 3:34:48 PM

Still hanging onto my short Jane but I've had my buy order in at NQ 1770. Give me my lunch money (a nice lunch!) and I'll be happy.

Jeff Bailey : 3/19/2007 3:31:11 PM

Reminder ... April Crude Oil (cl07j) futures expire tomorrow (Tuesday)

Jeff Bailey : 3/19/2007 3:27:30 PM

CEA Lazear: Subprime Woes "Probably" No Sign Of Larger Woes

DJ- The recent woes of the subprime lending market aren't likely to trigger contagion in the U.S. economy at large, President George W. Bush's top economist said Monday.

"The issue that I would focus on is not so much whether it's going to spread - I don't think many people believe it's going to spread - it's simply too small a part of the total economy for it to spread," Edward Lazear, chairman of the Council of Economic Advisers, said.

"The issue is whether it's symptomatic of some more general underlying phenomenon that's showing up first in the subprime market. I think the answer to that is probably not," he said, adding that the banking sector remains "very strong."

Lazear was answering questions after a speech at the conservative Heritage Foundation.

Though he said softness in the housing sector will have a negative impact on U.S. economic growth growth for at least the next six months, Lazear said the economy is strong and will stay resilient to headwinds from housing and high energy prices. Gross domestic product in the second half of this year should be in the 3% range, with full-year growth expected in the high-2% area, he said.

"Two thousand seven will be a good year," Lazear said.

Asked about the subprime mortgage market, he said he'd be reluctant to label activity in the sector "a shock."

"I think that what we see in the subprime market is a continuation of a trend that began a few months back, perhaps even a year back," he said. "It's not an unexplained trend; obviously when you see interest rates going up that's going to put pressure on adjustable rate mortgages."

Jeff Bailey : 3/19/2007 3:24:00 PM

Argentina's February Industrial Production +3.0% On Month

Jane Fox : 3/19/2007 3:21:31 PM

AD line is still a very bullish +1600

Jane Fox : 3/19/2007 3:20:52 PM

It is becoming painfully obvious that the late day rally will not appear today but the AD volume is still making new daily highs so not a time to be short. Sorry Keene.

Jeff Bailey : 3/19/2007 3:15:04 PM

03:00 Internals found at this Link

Keene Little : 3/19/2007 3:11:17 PM

Since I'm in an NQ short trade I'm obviously watching that a little more closely right now (duh). Support for this next leg down will be at 1770.50 (10-dma), 1769.25 (two equal legs down), 1767-1769 (30-min 100/130-pma's) and then 1768.50 (uptrend line from March 14th). All of these give pretty firm support at 1768-1770 so don't be bashful about taking profits there if so offered.

Jeff Bailey : 3/19/2007 3:02:53 PM

03:00 Market Watch found at this Link

Jeff Bailey : 3/19/2007 3:00:19 PM

Iraq Government Asks US To Hand Over Ex-Saddam Aide For Execution

Keene Little : 3/19/2007 2:53:45 PM

Sloppy price action and not worth our time for the rest of the day. I'm still looking for a little more of a pullback but it might correct sideways instead.

Marc Eckelberry : 3/19/2007 2:42:56 PM

As long as bulls hold NQ 1776.25, bears will gain little traction. If short, stops should be tightened.

Keene Little : 3/19/2007 2:42:13 PM

In tech-speak the Market Monitor problem seems to have been a "DNS propogation" problem with their multiple servers. I'm told the problem should resolve itself once it "re-propogates". Again, sorry for the hassle on this today and thanks for your patience (and feedback as it was helpful).

Keene Little : 3/19/2007 2:38:25 PM

A little bounce for a stop run in YM and ES? NQ is not participating, yet.

Keene Little : 3/19/2007 2:33:42 PM

It's just a guess on my part but it's looking like we could have enough hope out there for a rate cut by the Fed (phooey) so we could get a pullback tomorrow and then rally into FOMC on Wednesday, which would be a meal ticket for the bears. At this point I'd love to see that set up. For now I'm just scalping to see what develops from here.

Jane Fox : 3/19/2007 2:30:06 PM

Earlier this year I would have said there is a very good chance of a late day rally today but since the bears have been so strong of late the odds are less now.

Marc Eckelberry : 3/19/2007 2:36:01 PM

Watch 1776. 38.2% 2007.

Marc Eckelberry : 3/19/2007 2:29:13 PM

I did the same, Keene, after being long the morning. It's the right trade since we failed at weekly R1/20 day ema (1785/1786). A move above 1786 would be very bullish, so careful. Shorting weekly R1 before the Feds is the first step. Weekly R2 is next if that fails. Iwas either gooing to buy weekly S1 or short weekly R1.

Keene Little : 3/19/2007 2:26:02 PM

If you shorted NQ at that 1780.25 target (two equal legs up in its bounce off the lunch time pullback), then you should now lower your stop to 1781.25, two ticks to a new high for the move up since 1:00. The plan is for a ride down to where we'd have two equal legs down from this morning's high, so a downside target of 1769.25. There's no sense risking much at this point and that's why I like to pull my stop down as soon as the move gets started--it should work from here otherwise I'll get off this bus and wait for the next one.

Jeff Bailey : 3/19/2007 2:26:26 PM

DAIMLER UNIONS FIGHT PRIVATE-EQUITY BID

DJ- Growing opposition from union leaders comes as Cerberus Capital is piecing together a team of auto-industry veterans headed by former Chrysler executive Wolfgang Bernhard to bolster its expected bid for DaimlerChrysler's Chrysler Group.

DCX $74.66 +3.78% Link ... New 52-week high!

Jeff Bailey : 3/19/2007 2:26:06 PM

NOKIA FILES COMPLAINTS AGAINST QUALCOMM

DJ- Telecom giant launches preemptive legal strike against Qualcomm in Germany and the Netherlands, requesting Qualcomm's European patents be exhausted on products in that market. Qualcomm likely to respond with countersuit.

NOK $22.10 +1.14% Link

QCOM $43.08 -1.37% Link

Jeff Bailey : 3/19/2007 2:15:56 PM

ICE TO DISCUSS DEAL WITH CBOT MEMBERS (update)

DJ- IntercontinentalExchange delivers its merger proposal to the board of CBOT Holdings and says a definitive agreement between the exchanges could be reached within a week.

ICE $129.83 +2.72% Link

BOT $194.88 +2.56% Link

Jane Fox : 3/19/2007 2:12:27 PM

WASHINGTON (MarketWatch) -- U.S. home builders were less optimistic about the housing market in March, according to a monthly sentiment index released Monday by the National Association of Home Builders.

The NAHB/Wells Fargo housing market index fell to 36 in March from a downwardly revised 39 in February (originally reported at 40). It was the first decline in the index since September, when the index hit a 15-year low of 30. A year ago, the index was at 54; two years ago it was at 70.

Economists surveyed by MarketWatch were looking for a decline to about 38.

The index shows that about one-third of builders have confidence that the housing market is healthy. Over time, movements in the index have correlated well with the government's housing starts data, which will be released on Tuesday for February. Housing starts are down 36% from the peak.

Jane Fox : 3/19/2007 2:11:30 PM

NEW YORK (MarketWatch) -- Shares of brokerage stocks rose while most subprime mortgage lenders slipped Monday, as some investors saw an opportunity for major investment banks to pick up assets on the cheap in the troubled subprime sector.

Shares of Accredited Home Lenders (LEND) fell 5%, turning lower after rising near the open. The company said it's in third-party talks to line up new financing.

Other lenders also fell, with New Century Financial (NEWC) slipping 3%, Fremont General (FMT) falling 7% and Fieldstone Investment (FICC) skidding 10%.

In the brokerage sector, the benchmark Amex Securities Broker/Dealer Index (XBD) rose 0.8%.

Keene Little : 3/19/2007 2:08:25 PM

Still no luck on the Market Monitor sign-in issue on the standalone version. Sorry for the problems and I'll let you know as soon as I hear it's been solved.

Keene Little : 3/19/2007 2:07:34 PM

Doing another small consolidation. If this doesn't drop soon then it will look like we'll get a continuation of this morning's rally.

Jeff Bailey : 3/19/2007 2:04:11 PM

MCDONALD'S TO SELL LATIN AMERICA OPS

DJ- Fast-food giant is expected to announce the sale of its Latin American operations to Brazilian investment fund Pactual as soon as tomorrow, according to a report in local business daily Valor Economico.

MCD $43.88 +0.91% Link ... #18 weighting in INDU/DIA/YM

Jeff Bailey : 3/19/2007 2:01:41 PM

GROUP PAYS $4B FOR BRAZIL'S IPIRANGA

DJ- Consortium including Brazil's Petrobras and Braskem buy Ipiranga, Brazil's second largest oil distributor and refiner. The group's three members to split up Ipiranga's assets.

Braskem (BAK) $15.01 +16.53% Link

Petrobras (PBR) $88.03 +2.18% Link ...

Jeff Bailey : 3/19/2007 1:56:43 PM

CHIQUITA ADMITS IT PAID TERRORIST GROUPS

DJ- Banana company admits in federal court that it paid terrorists to protect its Colombian banana-growing operations for years. The guilty plea is part of a deal with prosecutors that calls for a $25 million fine.

CQB $13.40 -0.88% Link ...

Jeff Bailey : 3/19/2007 1:49:46 PM

NEW CENTURY GETS MORE CEASE, DESIST ORDERS

DJ- Beleaguered home lender receives cease-and-desist orders from 4 more states, restraining it from taking new mortgage applications. Firm gets notices of immediate repayment of repurchase obligation of about $900 million.

Jeff Bailey : 3/19/2007 1:46:19 PM

CHICAGO FED INDEX DOWN 2.3% IN JANUARY (12:00 PM EDT release)

DJ- Manufacturing activity in the Midwest region falls 2.3% in January from a month earlier, dropping to its lowest level since October 2005. Chicago Fed's manufacturing index falls to 102.1 in January, from 104.6 in December.

Chicago Fed Release Link (.pdf file)

Keene Little : 3/19/2007 1:46:03 PM

Interestingly, NDX looks like it's still vulnerable to another leg down. Two equal legs up in its bounce should make for a good short play. For NQ that's at 1780.25.

Keene Little : 3/19/2007 1:42:05 PM

Another blast higher so that should have you out of your short play.

Keene Little : 3/19/2007 1:33:25 PM

If you shorted this bounce I'd immediately pull my stop down to just above that last high. This needs to head down immediately so if it turns around and heads back up you want to step aside.

Keene Little : 3/19/2007 1:27:46 PM

Tech support can't duplicate the problem with the standalone version of the Market Monitor. If anyone is still having a problem with it please email me at at Support so that I can let them know.

Jeff Bailey : 3/19/2007 1:26:35 PM

01:10 Internals found at this Link

Keene Little : 3/19/2007 1:20:58 PM

This is the bounce to look to short now. Stop needs to be at a new high for the day so be a little careful.

Jeff Bailey : 3/19/2007 1:12:51 PM

01:10 Market Watch found at this Link

Keene Little : 3/19/2007 1:11:44 PM

Slap a Fib retracement on the decline from this morning's high and if we get a 3-wave bounce into the Fib retracement zone of 38%-62% I would then short it. We should get another leg down to match the first one.

Jane Fox : 3/19/2007 1:07:17 PM

I agree with Keene in that this dip may be a dip to buy but heck where do you get in? Well you could just jump in and put a stop below a PDHs for I do believe those will be support. Of course you could finesse the entry a bit more than just jumping in and wait until you see a swing low build. My very basic definition of a swing low is two lower lows and then a higher low.

Keene Little : 3/19/2007 1:03:13 PM

The RUT and NDX have given us a clean 5-wave pullback so we should be getting a bounce soon. That bounce should be followed by another move down so it looks like the pullback today could get a little deeper before potentially setting up another rally leg. Or we've topped out and now will start the next leg down. So the picture has now turned a little more bearish than it was.

Jeff Bailey : 3/19/2007 1:03:04 PM

US NAHB March Housing Index 36 Vs. Revised 39 In February

Jeff Bailey : 3/19/2007 12:59:23 PM

Put option symbol correction alert! ... NDE May $25 Put (NDE-QE)

Jeff Bailey : 3/19/2007 12:54:31 PM

Swing trade put option alert for one (1) of the Indymac Bancorp NDE May $25 Puts (NDQ-QE) at the offer of $2.20.

NDE $27.73 -3.88% Link

Keene Little : 3/19/2007 12:42:17 PM

If we haven't seen the highs for the day yet then this pullback should be bottoming near here and it could be worth a try on the long side to see if you can catch a ride back up.

Jeff Bailey : 3/19/2007 12:40:30 PM

ACAD $13.77 +105.82 ... sitting on GREEN #4.

Jeff Bailey : 3/19/2007 12:36:00 PM

ACADIA Pharmaceuticals (ACAD) $13.73 +105.23% Link surging after schizophrenia drug trial reaches goal.

Reuters Story Link

Keene Little : 3/19/2007 12:27:56 PM

Each pullback continues to look corrective so the better side to be on is the long side. But at this point it's obviously hard to jump on the long bandwagon. Short term charts are looking weak and that's why I'm looking for a scalp short to set up. But if the Boyz are intent on driving this higher then we'll probably get the usual small pullback/consolidation moves and then press it higher again, getting both the bulls and bears to quickly bid it up.

Jeff Bailey : 3/19/2007 12:25:54 PM

Saturday- People's Bank of China Raises Interest Rate 27 bp ... Asia Times story Link

Jeff Bailey : 3/19/2007 12:20:02 PM

AtheroGenics (AGIX) $3.19 -59.25% Link trades sharply lower after the drug maker warned that a late-stage clinical trial of a heart disease treatment didn't meet its primary goal.

Jane Fox : 3/19/2007 12:19:49 PM

Trading doesn't get much easier than it has been today.

Jane Fox : 3/19/2007 12:18:56 PM

This is very clearly a day to buy the dips. Link

Jeff Bailey : 3/19/2007 12:17:20 PM

Todco (THE) $38.59 +17.72% Link ... Drilling contractor agrees to be acquired by Hercules Offshore (HERO) $24.25 -8.73% Link in a $2.3 billion cash/stock deal.

Jeff Bailey : 3/19/2007 12:14:27 PM

ServiceMaster (SVM) $15.13 +12.32% Link agrees to be acquired by investment group for $5.5 billion (including $1.02 billion in debt).

Jeff Bailey : 3/19/2007 12:07:16 PM

ABN Amro (ABN) $39.80 +9.82% Link ... Largest bank in Netherlands surging on talk of possible acquisition target of Barclay's (BCS) $53.11 -0.72% Link ...

Keene Little : 3/19/2007 12:03:41 PM

Based on the NDX pattern I'd like to see one more push higher to then set up a scalp short. We may not get that new high though and any drop back below the lows around 11:20 AM would say we're already into the pullback.

Jeff Bailey : 3/19/2007 12:01:57 PM

Community Health To Buy Triad Hospitals For $5.1 Billion ... Reuters brief Link

CYH $34.52 -6.19% Link ...

TRI $51.93 +5.20% Link ...

RXH.X 490.23 +1.16% Link ...

Jane Fox : 3/19/2007 12:01:09 PM

DAteline WSJ - Community Health Systems unveils deal to acquire Triad Hospitals for $54 a share

Keene Little : 3/19/2007 11:47:15 AM

When the RUT closes its gap at 790.60, that could be the place we get a pullback that could be a short play. But again, scalp only until we see what sets up on the larger pattern.

Keene Little : 3/19/2007 11:44:07 AM

NDX has rallied above 1761 and that raises the probability that it will eventually rally to 1790. Any short plays at this point should be thought of as scalping only.

Jeff Bailey : 3/19/2007 11:30:58 AM

Valero CEO sees fire-damaged refinery back by May 1 ... Reuters Story Link

Marc Eckelberry : 3/19/2007 11:28:01 AM

NQ could be headed for 1790. Not a day to be short above 1776, 38.2% correction. Too many shorts out there, you have to close your eyes and forget rational thought.

Jeff Bailey : 3/19/2007 11:25:05 AM

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

Keene Little : 3/19/2007 11:18:49 AM

We're getting a small consolidation now so if it's followed by a new high that is accompanied by some bearish divergences then it will be time to start looking for a short entry.

Jeff Bailey : 3/19/2007 11:17:05 AM

11:00 Internals found at this Link

Notes: It would take a closing session measure of 72.00% for the NYSE 10-day NH/NL ratio to reverse UP into a column of X.

It would take a closing session measure of 36.00% for the NASDAQ 10-day NH/NL ratio to reverse UP into a column of X.

Jeff Bailey : 3/19/2007 11:01:52 AM

11:00 Market Watch found at this Link

Keene Little : 3/19/2007 10:55:41 AM

Keep an eye on this push higher now. It should set up a deeper pullback so watch to get short if we get a small consolidation and then another push higher that leaves bearish divergences. I'll try to call it as I see it setting up.

Jeff Bailey : 3/19/2007 10:54:27 AM

CME's Nov07 Housing Futures Table found at this Link

Composite, Boston, San Diego, San Franciso, Washington D.C. closed at contract lows on Friday benchmark.

Jane Fox : 3/19/2007 10:53:36 AM

BOSTON (MarketWatch) -- The subprime lending debacle could come home to roost in your neighborhood, in the form of reduced demand, sluggish appreciation or declining prices, one economist says.

Dr. Christian Weller, senior economist at the Center for American Progress, a Washington-based think tank, suggested that the rise in foreclosures of subprime loans will have widespread impact on consumers and the broader economy. During a radio interview with Chuck Jaffe, MarketWatch senior columnist, Weller said that subprime lending woes have much bigger implications than simply hurting the mortgage business; with the subprime business drying up, there will be fewer first-time home buyers, which slows all other housing activity.

Weller compared the situation to the game "Jenga," where blocks are stacked up in a tower, and said it's as if the bottom blocks had been removed. The result could be the long-forecast "pop of the real estate bubble."

"For 2007, it's a safe bet to assume the value of your home won't increase," Weller said. "And people should be worried that if they have to sell, they won't be able to."

One positive to come from the situation is that it could create "buying opportunities," where consumers with strong credit can buy houses at a cheaper price than in the recent past and at mortgage rates that are competitive. Subprime loans typically are made at about 3 percentage points above average market rates; Weller noted that when the industry's problems became apparent, interest rates actually fell as it prompted speculation that the Federal Reserve would cut rates more quickly.

Jane Fox : 3/19/2007 10:52:57 AM

TICKS are going crazy and I am getting one +1000 reading after another.

Keene Little : 3/19/2007 10:56:45 AM

I have been having problems with Market Monitor today. It won't launch off my desk top. I can pick it up on the web site. Will you please tell someone over at Option Investor? Customer Service always spams my e-mails. Thanks.

Jane was complaining this morning and I've received a couple of emails on this so I'm trying to see if tech support is aware of the problem. I always use the browser version since the standalone version has never worked right on my computers (won't update and it may have to do with my firewall). So sorry about the problems and we'll see what's wrong.

As for having trouble getting emails through, I know many of you suffer this problem. It seems especially true from bellsouth and verizon addresses and it has to do with the number of spam emails sent out by them so OI is forced to filter their emails out. I suggest getting a gmail address and using that to contact OI.

Marc Eckelberry : 3/19/2007 10:49:55 AM

NQ 1772.25 is day R1.

Marc Eckelberry : 3/19/2007 10:48:41 AM

I only recommend scalping until we either get to weekly R1 or weekly S1 ahead of the Feds (reversal plays)

Marc Eckelberry : 3/19/2007 10:46:43 AM

It looks like bulls have it now, 1768 held and so did 10 day ema at 1769, OEX is above 10 DMA and we could get some more short squeeze.

Jane Fox : 3/19/2007 10:46:29 AM

Now we have the VIX making new daily lows supporting the AD volume's new daily highs and it is safe to go back in the water and buy the dips.

Jeff Bailey : 3/19/2007 10:46:17 AM

CME's Aug07 Housing Futures Table found at this Link

Keene Little : 3/19/2007 10:45:57 AM

The pattern for the NDX is the one that leaves me guessing what will play out if this rally fails to make a new high above the one on March 9th (near 1761). Because of the multiple 3-wave moves I get the feeling from this that we could see price consolidate in a trading range into the end of the month before we get the next leg down. But a rally above 1761 then has the potential to get up near 1790 before rolling over sooner than the end of the month. Link

Marc Eckelberry : 3/19/2007 10:45:33 AM

Even though oil is down and the dollar is up, YG is holding 50 DNA. That is bullish and a sign of accumulation.

Marc Eckelberry : 3/19/2007 10:44:22 AM

See the sellers hit OEX 638.20? Bulls are not quite able to punch above. Yet. Watch NQ 1768 (50%) and 1764, gap close.

Jeff Bailey : 3/19/2007 10:43:41 AM

Boston Aug07 Housing Futures also making new relative low here at 164.00 and just below 09/15-09/20/06 closes of 164.40.

Jeff Bailey : 3/19/2007 10:37:04 AM

CME's May07 Housing Futures Table found at this Link ... San Diego closed below its 08/09/06 relative low close of 233.80 on Friday (03/16/07).

Keene Little : 3/19/2007 10:35:32 AM

SPX roadmap update looks the same as what I showed for the RUT and DOW. First potential resistance line is at 1400 where I could be tempted to try a short play, especially since a new high from here would give us a 5-wave move up from Friday afternoon and we'll be due at least a pullback. If that becomes the high for the bounce off the low on the 14th then the next leg down will be a doozy. Link

Marc Eckelberry : 3/19/2007 10:35:19 AM

Watch OEX 638.18 resistance. The markets will stall until we close a 15mn candle above.

Jeff Bailey : 3/19/2007 10:34:31 AM

Boston May07 Housing Futures alert! 166.60 -0.477% ... slips below its 08/09/2006 close.

Jeff Bailey : 3/19/2007 10:20:56 AM

S&P Dep. Receipts (SPY) $139.27 +0.53% ... 60-minute interval chart with updated WEEKLY Pivot retracement at this Link

Jane Fox : 3/19/2007 10:20:04 AM

AD volume is making new daily highs but the VIX is testing its daily highs and that should always worry a bull. When the internals are out of sync like this it usually means sideways and very little follow through in either direction.

Keene Little : 3/19/2007 10:09:04 AM

The current pullback this morning looks like it should lead to another press higher. At that point we'd have a small 5-wave move up from Friday afternoon and we should then get a larger pullback at a minimum. Because it will be possible the leg up this morning will complete the move up from March 14th (for a small 2nd wave correction), it would be a good time to try a short just in case it takes off to the downside. Once the larger pullback starts we'll see how it looks as to whether or not it could be just another corrective pullback before heading back up again.

Jane Fox : 3/19/2007 10:06:26 AM

Exactly the same story for the DOW. Link

Keene Little : 3/19/2007 10:05:16 AM

The DOW's 60-min roadmap update shows a similar setup as for the RUT that I just showed, except much weaker in that it's not even close to challenging the high on March 12th. In fact it hasn't even been able to break the downtrend line from February, currently near 12210. Link

If the DOW were to test this trend line and then drop back below Friday's low near 12082 then short will be the place to be. Any choppy consolidation below its downtrend line will likely mean it will head higher. The green wave count (a-b-c move up from the low on March 5th) would not be confirmed until the DOW gets above 12349 to get above last Monday's high.

If the DOW follows the bullish path to a new high for this bounce, as shown for the RUT, we'll get a 5-wave move up from the 14th and the Fib projection at 12340 matches up with a 50% retracement of the decline from February. If this happens by the time we approach the FOMC announcement I'd be short for that announcement.

Jane Fox : 3/19/2007 10:02:42 AM

The SPX has been building a trading range since the infamous fall it took on February 27 with the January lows resistance and the November 28th swing low as support. A wider range is between the 50EMA and the 200EMA. Link

Jeff Bailey : 3/19/2007 10:02:19 AM

10:00 Market Watch found at this Link

Jane Fox : 3/19/2007 9:52:21 AM

Notice how ES has used its PDH as resistance and NQ is using its PDH as support. Link

Keene Little : 3/19/2007 9:51:03 AM

This RUT 60-min chart shows the two possibilities as I currently see them. One is that the current rally will fail below the high on Monday the 12th and roll over into the next big leg down. With that high at 789.88 and the RUT hitting 785.34 so far this morning it obviously can't rally much more without negating the bullish wave count on the chart. Link

A rally above 790 would say we're going to get a 5-wave move up from the low on Wednesday the 14th for wave-c in the green a-b-c wave count. The upside Fib projection at 804 matches up with a 62% retracement of the decline from February. It doesn't have to get there but that's the potential. We'll watch the wave count to help determine where the high might occur if 790 is exceeded.

If this morning's rally fails and drops back below Friday's low near 776 then the pattern turns bearish again and I'd want to be short. As we saw at the high in February and again on the 12th, minor new highs after a price consolidation were followed by swift selling. If that were to occur again here I think the selling will be very swift. Watch and wait for now.

Jane Fox : 3/19/2007 9:43:47 AM

NEW YORK (MarketWatch) -- Gold futures eased early Monday as the dollar rose against major counterparts in the foreign-exchange market, weakening demand for the precious metal.

Gold for April delivery fell 40 cents at $635.50 an ounce. In New York Mercantile Exchange trading on Friday, the metal rallied 1%, adding $6.80 to close at $653.90 an ounce.

The dollar rose against other major currencies to start the trading week. The euro was down 0.1% at $1.3296, while the dollar was up 0.5% at 117.34 against Japan's yen.

Investors are awaiting an interest-rate decision from the Federal Reserve at midweek.

"Data from the United States, particularly the Fed's decision on interest rates, will again be pivotal to gold's direction this week with further signals of a slowing housing market likely to again be bullish," said James Moore, a metals analyst at TheBullionDesk.com.

Jane Fox : 3/19/2007 9:41:44 AM

VIX opens within its PDR as does the TRIN albeit at PDLs. TRIN is a bullish 0.71.

Jeff Bailey : 3/19/2007 9:41:20 AM

Weekly/Monthly Index Pivot Matrix found at this Link

Jane Fox : 3/19/2007 9:38:37 AM

AD line is a very bullish +1800 and of course the AD volume is well above 0 and climbing. Not a time to be short.

Jane Fox : 3/19/2007 9:37:56 AM

ES is now testing its PDH but the other three are trading above their respective PDHS.

Keene Little : 3/19/2007 9:29:53 AM

With all the talk about the Fed being closer to a rate cut (because of all the worries about the housing market) traders are once again on that hope run. With the rest of the world raising interest rates, and therefore making their currencies more attractive, do people really think the Fed will lower ours? The US dollar is struggling enough right now.

With inflation numbers clearly higher than the Fed wants, do people really believe the Fed will cut rates? But hope is what drives the market and if it rallies into FOMC with these hopes still alive it will set up one heck of a short play. I don't know from what level that short play would set up but it would be a good one.

Jane Fox : 3/19/2007 9:27:33 AM

I am sorry but I am having issues with the Monitor this morning, however, I am working on them.

Keene Little : 3/19/2007 9:20:00 AM

Looks like we're going to get a gap up instead of a gap down. The gap up will take the DOW and SPX right back up to their 30-min 100/130-pma's (10-dma) and could find resistance there again. Who knows, this could turn into a gap n crap. But the wave pattern was set up for a bearish follow through this morning and that's not going to happen.

I had mentioned Friday that any rally back above the Friday afternoon high would bust the setup. That will happen at the open. Any rally above Friday morning's high would likely mean we'll get a push back up that could test the high on March 12th, and possibly continue higher from there. Keep an eye on the Trannies if they're still out ahead.

Therefore if you were positioned for an immediate decline, such as with some long puts, I'd bail this morning and see how this sets up next. We should get a pullback from Friday's high so you can try timing it with a pullback rather than immediately after the open.

Jane Fox : 3/19/2007 8:58:59 AM

Bullishness is breaking out all over. NQ has even broken its PDH and seems to be using it as support now. This bullishness has been helped along by the overseas markets. Japan's Nikkei 225 index rose 1.6% at 17,009.55 and the pan-European Dow Jones Stoxx 600 index added 0.8% at 361.90. Link

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