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Keene Little : 4/22/2007 10:48:33 PM

Lastly, the NYSE, which has been very strong, closed up against its broken uptrend line from July. These trend lines are often still in play long after they're broken. Short term Fib projections show 9720-9730 is a strong Fib wall to break if it manages to push a little higher on Monday morning. This index also looks ready for a pullback, or worse, right around the corner. Link

Keene Little : 4/22/2007 10:25:18 PM

It's a tale of two markets right now. Equities are in an uptrend and that's the first thing to keep in mind--any attempts to find a top to this market is by definition trading against the trend. The DOW looks very bullish at the moment but looks ready for at least a pullback. The short term pattern looks like resistance should be found just under 13K so be careful about any early pop higher Monday morning as it could be quickly followed by some selling.

The techs are not supporting the exuberance shown by the blue chips and that's a little worrisome. As shown on the NDX charts, we could see a minor push higher on Monday morning but it hit some upside Fib targets and could be finished for now. Then whether it pulls back correctively and heads higher or starts something more significant to the downside is not clear yet. What looks bearish is the doji left at resistance for the COMP, as shown on this daily chart: Link

The other thing I'm seeing across the board are potential ascending wedges. These will be very common in bear market rallies. Therefore, if the decline from the February high was the kickoff to the next bear market, then the current rally, labeled as wave-B on the COMP chart (and the other charts in dark red) will soon fail and we'll see a strong decline follow. As shown on the COMP chart, we could get a fairly sharp decline to the 2250 area by the end of May (coinciding with a move down to the SPX 1320 area by the end of May).

Even INTC is up against resistance by its downtrend line from January 2004, and left a bearish looking hanging man doji on Friday: Link If it presses a tad higher on Monday, watch the Fib projection at 22.24. It's also potentially putting in a triple top here, like the tech indices themselves. A red candle on Monday would be a bearish reversal signal for INTC.

And finally, it's way too early to tell but the broadening top that I show here on this NDX daily chart could be the left half of a diamond top, both of which are topping patterns: Link I also show a potential rounding top, also a bearish topping pattern. Obviously if the market just keeps rallying higher then this pattern is busted. Also note that if the diamond top is to complete we're looking at some volatile price action ahead through the summer (instead of a hard decline as I showed for the COMP).

The bottom line is that there are lots of possibilities here but the short term looks like at least a pullback is coming. Whether that drops impulsively or correctively will then provide some clues as to what's next. But what I'm seeing on many charts has me leaning towards interpreting the bounce off the March low as only an a-b-c bounce as part of a larger downside (or possibly large sideways) correction. So don't stay married to the long side if you're currently long.

Keene Little : 4/22/2007 10:24:00 PM

Monday's pivot tables: Link and Link

Roadmap updates:
DOW Daily: Link and 60-min: Link
SPX Daily: Link and 60-min: Link
NDX Daily: Link and 60-min: Link
RUT Daily: Link and 60-min: Link
GOOG Daily: Link Notice that Friday's post-earnings gap up stopped at the top of a parallel down-channel and dropped back below the key levle of 485. I see 2 out of 3 chances for GOOG to drop from here.
CME Daily: Link and 60-min: Link
gold Daily (GLD): Link

OI Technical Staff : 4/22/2007 9:59:59 PM

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Jeff Bailey : 4/22/2007 9:47:17 PM

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

Traders should have been stopped on the 1/2 bullish position in shares of Coeur D' Alene Mines (CDE) at $4.05 on 04/19/07.

Traders should have sold two (2) covered calls with the Caterpillar CAT May $72.50 Call (CAT-EA) at the open for $1.68 on Friday (4/20).

Jeff Bailey : 4/22/2007 9:35:46 PM

Caterpillar (CAT) $71.82 +4.66% ... Earnings Press Release (from Friday morning) at this Link

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