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Keene Little : 6/7/2007 1:04:15 AM

Some interesting data from Markettells.com that shows the odds for a higher market in the next 3-5 days is good. Wednesday was the 2nd day with stronly negative market breadth, the kind that typically is found at short term bottoms. The data points to the likelihood that we will see limited downside and more likely a rally. This fits with the EW patterns and support that I see on the charts and an expectation that we'll get a rally into next week.

It would appear that the hard drop in the futures after the cash market closed on Wednesday may have been designed to spike long players out of the market, and suck in some shorts, thereby causing them to chase it higher tomorrow. Now we'll see if that's how it plays out.

Keene Little : 6/7/2007 12:30:07 AM

As I mentioned in tonight's Market Wrap, the market must rally tomorrow (futures are up tonight so we'll see if they hold up). A brief spike down is OK but it can't dawdle--it must get a rally going otherwise we'll see some important support levels break. Here are the 120-min chart roadmaps with the key levels identified:
DOW: Link
SPX: Link
NDX: Link
RUT: Link
Gold is a short against its broken uptrend line/50-dma: Link

Keene Little : 6/6/2007 11:50:40 PM

Thursday's pivot tables: Link and Link

OI Technical Staff : 6/6/2007 9:59:59 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The Market Monitor has been archived.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 : 6/6/2007 7:20:15 PM

Brazilian Bovespa ($BVSP) Link

Jeff Bailey : 6/6/2007 7:15:46 PM

Brazil's Central Bank Cuts Key Rate 50bp to 12.00% ... as expected.

Jeff Bailey : 6/6/2007 7:05:52 PM

House Appropriations Panel Rejects 08 Funding To Expand SPR

DJ - The U.S. House Appropriations Committee rejected on Wednesday the Bush administration's request for funding to double the capacity of the Strategic Petroleum Reserve, and instead boosted funding for research and development into clean energy technologies.

The Department of Energy earlier this year began expanding the SPR in a two-stage process from around 727 million barrels of crude now to 1.5 billion barrels by 2027, selecting prospective sites for expansion.

Kirsten Brost, Appropriations Committee spokeswoman, said in a statement that the panel rejected the Department of Energy request for $168 million for administration costs for the expansion, "to instead invest in conservation measures and alternative fuels."

The committee boosted total energy spending for fiscal year 2008 to $31.6 billion, $1.1 billion more than President Bush requested. It approved spending of $1.9 billion for research and development of technologies that it said would reduce the country's dependence on foreign sources of crude and cut greenhouse gases, almost $640 million more than the administration sought.

Department of Energy spokeswoman Megan Barnett said doubling the size of the SPR would provide an additional layer of protection for the nation's long-term energy security.

"We will continue to work with Congress on this important matter that will help ensure that adequate fuel supplies are available to the American people in the case of a severe supply disruption," Barnett told Dow Jones Newswires.

The current SPR holds the approximate equivalent of 55 days of net imports while expansion of its capacity to 1.5 billion barrels would provide almost 100 days of net import protection, she said.

Solar energy, biomass, vehicle technology and carbon dioxide sequestration research and development all saw increased levels of funding.

The panel also cut funding for the President's Global Nuclear Energy Partnership, which would create a cartel of suppliers of enriched nuclear fuel as part of an anti-proliferation effort.

Instead, the Appropriations Committee approved $100 million to establish an International Atomic Energy Agency nuclear fuel bank to create a reliable source of nuclear fuel for countries.

"It is unnecessary to rush into a plan that continues to raise concerns among scientists and has only weak support from industry given that there are reasonable options available for short-term storage of nuclear waste and that this project will cost tens of billions of dollars and last for decades," Brost said.

Jeff Bailey : 6/6/2007 6:52:06 PM

Closing Internals found at this Link

Jeff Bailey : 6/6/2007 6:47:44 PM

SMH breadth finished 1:18

SMH components Link

Jeff Bailey : 6/6/2007 6:11:46 PM

Now I know why I was getting questions regarding European bourses today.

Jeff Bailey : 6/6/2007 6:11:40 PM

Morgan Stanley Issues Triple Sell Warning On Europe Telegraph.co.uk Story Link

Jeff Bailey : 6/6/2007 5:02:29 PM

Continuous Gasoline vs. Continuous WTIC ... 0.30 point box Link ... Update to 06/01/07 02:15:43 MM

Jeff Bailey : 6/6/2007 4:52:19 PM

EIA's This Week In Petroleum Link

Jeff Bailey : 6/6/2007 4:50:35 PM

July Unleaded (rb07n) settled down $0.0169, or -0.77% at $2.1904.

Last Thursday's settlement was $2.2032, so I can't draw any type of a conclusion here.

Jeff Bailey : 6/6/2007 4:47:56 PM

July Crude Oil (cl07n) settled up $0.35, or +0.53% at $65.96.

Jeff Bailey : 6/6/2007 4:46:42 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 6/6/2007 4:23:00 PM

email ... Jeff ... I know Wednesday's are a busy day for you, but with these higher premiums, any good looking naked puts plays on your radar for stocks that trade under $100? I like to sell at least 5 contracts, but only on stocks between $50 and $100.

Reply: I looked, but maybe Jane came up with a good candidate in HIG. Selling the strike that's in a strong support area with VIX.X jumping today.

Keene Little : 6/6/2007 4:02:24 PM

Too steep a sell off in the futures--I'd abandon the long side for any overnight trades.

Jane Fox : 6/6/2007 3:59:47 PM

Here is another chart that is setting up a potential "buy the dip" but if you look at the monthly chart you realize that it is not anywhere near as good a candidate as HIG. Link

Keene Little : 6/6/2007 3:58:08 PM

Into the home stretch and today's numbers look terrible (unless you're short). The bounce off this afternoon's low still looks more corrective than I'd like to see for a long position held overnight. There's not much room back down to the lows to provide some cushion so assess your risk. At least carry a smaller position than you might otherwise. The bullish side of the wave pattern in the bounce says we'll gap up tomorrow but I'm not sure I'd consider that a high-odds scenario.

Jane Fox : 6/6/2007 3:55:45 PM

Although the SPX chart is telling me this "dip" may be over the NAZ chart is saying it may have further to go. I think this market could revisit its 50EMA. Link

Jane Fox : 6/6/2007 3:52:50 PM

Jeff, that would be cool if we could both trade a stock (HIG) but with two different approaches.

Jeff Bailey : 6/6/2007 3:51:56 PM

Toll Brothers (TOL) $28.50 -1.34% ...

Jane Fox : 6/6/2007 3:51:32 PM

I suspect we will get a bounce off the this lower trendline tomorrow. Link

Jeff Bailey : 6/6/2007 3:51:14 PM

NVR alert! 730.00 -3.31% ... back at bar chart upward trend and 61.8% retracement.

Jeff Bailey : 6/6/2007 3:29:50 PM

HIG PnF chart at this Link

Keene Little : 6/6/2007 3:23:37 PM

That's a better bounce. Now stops on longs can be raised to just below the pullback just past 3:00 PM. Keep inching it higher until you can get to breakeven and then let it ride. If I've got the wave count correct it could be a very choppy ride back up but the potential is very large. I'd rather not try to daytrade the move. If price drops back below a recent pullback low think about reversing short.

Jeff Bailey : 6/6/2007 3:19:12 PM

I was looking for a good NAKED put premium seller all day and couldn't find one.

Jane might be onto something there.

Jeff Bailey : 6/6/2007 3:17:49 PM

Swing trade sell NAKED put alert ... for one (1) of the Hartford Financial Services HIG July $95 Puts (HIG-SS) at the bid of $0.70.

HIG $100.80 -0.70%

VIX.X 14.73 +8.07% ...

Jeff Bailey : 6/6/2007 3:13:11 PM

03:00 Internals found at this Link

Keene Little : 6/6/2007 3:05:41 PM

So far the bounce off the low looks like a corrective 3-wave bounce. It doesn't mean it can't turn into a bigger bounce but I'm not seeing anything impulsive to the upside yet. Keep your stops as close as you're comfortable until we get some upside (or not).

Jeff Bailey : 6/6/2007 3:02:14 PM

03:00 Market Watch found at this Link

Jane Fox : 6/6/2007 2:58:56 PM

Here is nice one. Notice how this stock has been rallying since March of 2003 (Monthly chart). Link

Jane Fox : 6/6/2007 2:55:17 PM

I was looking at HAL as a potential buy the dip as well but then I noticed OPPS monthly is red so does not fit the criteria. Link

Jeff Bailey : 6/6/2007 2:53:18 PM

German DAX ($DAX) 50-point box chart at this Link

I've marked it up a bit and added Wednesday's action.

Jane Fox : 6/6/2007 2:50:09 PM

Here is another that is potential buy the dip. Link

Keene Little : 6/6/2007 2:43:49 PM

I'm back. I see the indices made a test of their lows, SPX and DOW more so, and held so the stops on longs can be moved up a tad to just below that last pullback low at 2:21 PM. Keep risk small here until we see if a bottom has been put in.

Jane Fox : 6/6/2007 2:34:34 PM

Reverse H&S forming but ER has the best one. Link

Jeff Bailey : 6/6/2007 2:28:22 PM

email ... Jeff, I recently signed up for DW's free trial. They show a 1000 scale for the DAX. That seems kind of big considering the DJIA is 50 point. What do you think?

Response: ... Yes, I'd suggest a 50-point box for the DAX.

Jane Fox : 6/6/2007 2:20:59 PM

Here is another stock that has been on a tear and is now giving us a potential dip to buy. Link

Jeff Bailey : 6/6/2007 2:15:36 PM

US State Department: Turkish Invasion (update) ...

DJ- The U.S. State Department hasn't confirmed a Turkish invasion of Northern Iraq, a spokesperson said Wednesday.

"We have not confirmed reports," said Janelle Hironimus, the spokesperson.

Her comments came amid confusion other whether Turkish troops had crossed into Northern Iraq. Two senior Turkish security officials said several thousand Turkish troops crossed into northern Iraq early Wednesday to chase Kurdish guerrillas who operate from bases there, although they stressed it didn't constitute the kind of large incursion Ankara has been discussing in recent weeks.

Meanwhile, a Turkish foreign ministry official said the country had thousands of troops on the border but denied they had crossed.

Late last week, the State Department confirmed Turkish troop build up in Southern Turkey, and said the army was conducting "anti-terrorist" operations "in and around" the border.

Jeff Bailey : 6/6/2007 2:12:17 PM

Fed's Lacker: ... Payroll Growth Has Held Up "Quite Well"

Jane Fox : 6/6/2007 2:10:05 PM

Here is a possible trade, CVS. This stock has been on a tear and the daily has just gone red so we need the 60 and 120 charts to turn back green and that is our "green" light to "buy the dip." Link

Jeff Bailey : 6/6/2007 2:09:38 PM

US State Department: ... No Confirmation Of Turkish Invasion of N. Iraq.

Jeff Bailey : 6/6/2007 2:08:43 PM

Fed's Lacker: ... Doesn't Fully Understand Recent Productivity Slowdown.

Keene Little : 6/6/2007 2:07:22 PM

I've got to step away for about 30 minutes.

Keene Little : 6/6/2007 2:04:32 PM

SPX has now broken it downtrend line so it's a start. The bounce is still looking corrective but on very short time frames I've noticed that's somewhat common. It's taken a bit of work to find the bottom today but the last one might have been it. If long place your stop just below today's low. My concern here is that if it lets go it could start getting a little ugly to the downside.

Jane Fox : 6/6/2007 1:46:38 PM

SMith open number system is telling you don't even think long. Link

Keene Little : 6/6/2007 1:41:38 PM

SPX could still drop a little lower but it's starting to look like a descending wedge with bullish divergence so be careful if short. A move much higher will break its downtrend line. Link

Keene Little : 6/6/2007 1:23:56 PM

Still dropping and looking more bearish if this continues. Watch DOW 13424, the May 24th low. If that gets taken out then forget about trying to buy this.

Jane Fox : 6/6/2007 1:21:43 PM

Once they do and the 120 and 60 minute turn back green I will pounce.

Jane Fox : 6/6/2007 1:21:05 PM

jtHMA has not turned red on any major market - yet!

Jeff Bailey : 6/6/2007 1:20:52 PM

01:00 Internals found at this Link

05/23/07 Internals at this Link

Jane Fox : 6/6/2007 1:19:53 PM

Yesterday the jtHMA charts would have gotten you into a DIS long but stop put at June 1st lows would have gotten you out. Link

Keene Little : 6/6/2007 1:17:35 PM

It's a good place to start nibbling on a long here.

Jane Fox : 6/6/2007 1:16:21 PM

The July DIA puts I bot last week at 2.05 are now 2.80 * 2.90.

Jane Fox : 6/6/2007 1:06:07 PM

WE may be hammering out a bottom here but I will not be on board.

Jane Fox : 6/6/2007 1:05:34 PM

ES just made a new daily low and the VIX is hovering around daily highs so all bullish bets are off.

Jeff Bailey : 6/6/2007 1:00:55 PM

01:00 Market Watch found at this Link

Keene Little : 6/6/2007 12:59:51 PM

Bullish divergences showing up on the 5 and 15-min charts now so I wouldn't want to chase this any lower but instead start looking to nibble on a long play. Once it starts working then you can add to it. Only after the bounce gets going (assuming it will) will we see if it's corrective or not.

Jeff Bailey : 6/6/2007 12:56:54 PM

On a one-minute chart, forget everthing else and trade the YM.

Wayyyyy to short a time interval to use any other indicator.

Keene Little : 6/6/2007 12:52:30 PM

I'll make it short - On the (1) minute chart, what comes first?: The VIX or the Market, the YM or the DOW. Thanks.

I'll throw this question out to Jane and Jeff. I know Jane watches the VIX a lot more closely than I do. I often see the futures move before cash but I know the arbitrageurs watch for imbalances between the two so if the cash market makes a move then futures might quickly follow. Jeff follows the buy and sell program signals so perhaps he has a better feel on this one.

Jeff Bailey : 6/6/2007 12:52:23 PM

SMH $36.31 -0.87% ... I'd say, based on observation, that there were some sellers at WEEKLY Pivot.

Keene Little : 6/6/2007 12:38:54 PM

NDX found support at the bottom of its down-channel that I've been showing since yesterday. Price action has been pretty whippy on that index and I'm not sure if the pullback is finished or if it will stay within the down-channel to its uptrend line from March (which is where the 50% retracement at 1905 would come into play). The choppy pullback continues to look bullish so it's a matter of when the next rally leg will start, not if. But a break below 1896 would start to have me questioning the bullish potential. Link

Jane Fox : 6/6/2007 12:38:03 PM

Expect the markets to come back down and make a higher low. If the daily lows break then all bullish bets are off.

Jeff Bailey : 6/6/2007 12:37:55 PM

Interesting comments being made on CNBC regarding the yield a trader wants on longer-dated maturities. He thinks 5.5%.

Today, I think 4.5% attractive.

Marc Eckelberry : 6/6/2007 12:37:44 PM

All in all, no panic but that can change. It's a -2000 day, so be careful if long at lows, be disciplined. NQ must hold support on a lower low is 1912 and 1909.

Marc Eckelberry : 6/6/2007 12:35:13 PM

Gold might have put in a bottom on a test of 20 dma and hold. Now on a bid above 38.2% 2007 at 673.20.

Marc Eckelberry : 6/6/2007 12:33:43 PM

SPX holds 20 sma and 20 ema (1517/1518). It was done with a lower low and a bullish divergence. VIX hit the upper envelope resistance at 14.90. The market would be in major sell-off mode on a drop of SPX 1516 and VIX +15, but so far we are holding. Semis are stronger on a relative basis with momentum stocks like AAPL and NVDA being bought. Watch NQ 1918.75, yesterday's low.

Keene Little : 6/6/2007 12:27:00 PM

Getting a stronger bounce now so there's a good chance the bottom is in. At least it makes for the right place for your stop if you're trying the long side here. We may get another push back down to retest the lows or make a slightly lower low. If that happens we should see lots of bullish divergences associated with it if we're in fact putting in a bottom and preparing for a rally into next week.

Jeff Bailey : 6/6/2007 12:24:05 PM

Stop correction alert ... per my 11:08:34 Post. Bullish stop goes at $84.78 (typed $87.48).

Jeff Bailey : 6/6/2007 12:13:53 PM

ASTRAZENECA CFO LEAVES FOR GOLDMAN SACHS

DJ- Jon Symonds, notable for his M&A experience, will leave at the end of July for a management post with the investment bank. An external search is underway for a successor. Symonds' exit comes after Brennan is appointed head of drug maker.

Jeff Bailey : 6/6/2007 12:12:45 PM

PetroChina (PTR) $133.92 -1.45% ...

Jeff Bailey : 6/6/2007 12:12:24 PM

US Oil Fund (USO) $50.23 +0.41% ...

Jeff Bailey : 6/6/2007 12:11:56 PM

GONU AFFECTS OMAN, UAE OIL OPERATIONS (update)

DJ- The Arabian Peninsula's worst storm in the 60 years since records were first kept, is bearing down on the Strait of Hormuz, threatening to cut all transportation through one of the world's most important petroleum arteries.

Jeff Bailey : 6/6/2007 12:11:01 PM

PENTAGON MAY END LOCKHEED PROGRAM

DJ- Defense Department says a $5.8 billion cruise-missile program faces termination if its performance doesn't improve, pressuring Lockheed to show it has a way to fix navigation glitches and improve reliability.

LMT $96.48 +0.29% ...

Jeff Bailey : 6/6/2007 12:09:33 PM

BUSH CONFIDENT RUSSIA WON'T ATTACK EUROPE

DJ- U.S. president discounts Vladimir Putin's threat to retarget missiles on Europe, saying 'Russia is not going to attack Europe.' Bush also says he's looking forward to working with German Chancellor Angela Merkel on climate change.

Jeff Bailey : 6/6/2007 12:08:41 PM

WHITE HOUSE CUTS 2007 GDP VIEW

DJ- Bush administration now expects real gross domestic product to expand 2.3% this year, down from its earlier projection of 2.9% based on sluggish 1Q. It sees solid growth for the rest of 2007, with strong gains in the labor market.

Jane Fox : 6/6/2007 12:08:07 PM

NEW YORK (MarketWatch) -- Reformulated-gasoline futures touched their lowest level in almost a week Wednesday after a government report showed that supplies of the motor fuel climbed for a fifth straight week.

Prices then cut their losses as traders realized that refinery activity slowed in the latest week.

Crude futures prices edged slightly lower, though there was a conflict between data from two separate reports, with one reporting a small decline in supplies and the other reporting a nearly 6 million-barrel decline.

"The healthy build in gasoline inventories in the week marking the beginning of the summer-driving season will prove bearish to prices," said Rakesh Shankar, a senior economist at Moody's Economy.com.

Also, "markets are still likely trying to decipher the impact of [Cyclone] Gonu on oil export and production facilities in Oman and Iran," he said in a weekly report issued after the supply data.

Jeff Bailey : 6/6/2007 12:07:49 PM

I urge EBAY, GM, OLN and PTR to sell their company's for 100% above current prices.

Jeff Bailey : 6/6/2007 12:06:50 PM

HEDGE FUNDS PUSH FOR AMERITRADE DEAL

DJ- Shares of online financial-services firm rise 3% after the company reveals it's being urged by certain investors to merge with a rival, such as E*Trade or Charles Schwab. Ameritrade CEO implies that such a deal is possible.

Jane Fox : 6/6/2007 12:01:13 PM

I am giving a heads up to the bears here. ES made a new daily low that was not confirmed by the VIX and I think the bottom is in. Link

Keene Little : 6/6/2007 11:54:02 AM

And SPX is nearing its potential support line at 1515. The bulls will definitely need to arrest the sink rate here if they have any hope of pulling out of this dive.

Keene Little : 6/6/2007 11:51:13 AM

If I squint I can see some bullish divergences appearing on the 5-min DOW chart so just maybe...

Keene Little : 6/6/2007 11:50:06 AM

The DOW is now closing in on the 13465 level I pointed out earlier (bottom of its parallel up-channel from March) so the bulls need to start stepping up to the plate soon. A break below 13424 won't look so good for them.

Keene Little : 6/6/2007 11:46:09 AM

The housing sector is getting a spanking today, down -2.7% at 630.79 currently. The index gapped down and bounced a little but hasn't moved a whole lot today. The 60-min chart shows a parallel down-channel for price action since the May high and the bottom of the channel and a Fib projection both point to the 626-627 area as potential support. Link

The daily chart shows the index is now down near its uptrend line from April, also near 626, and its 50-dma is at 627.40. I would expect it to find support near this level and there's even a good chance it will rally back up, as per the light red (pink) wave pattern before finally finishing its bearish consolidation pattern. But a bounce (assuming we get it) and then drop back below 625 would be more immediately bearish. Link

Jeff Bailey : 6/6/2007 11:34:39 AM

Valero Energy Sell $2.25 Billion in Bonds ... Reuters Story Link

Jeff Bailey : 6/6/2007 11:29:51 AM

This morning's mass confusion in the energy pits, especially unleaded comes from the notable build in the refined product (supply), but the inputs (demand) and the 6,000 bpd decline in operable capacity.

Should unleaded prices decline further, the loss of output at higher prices becomes a "double-edged sword" for refiners.

Jeff Bailey : 6/6/2007 11:27:16 AM

EIA Weekly Gross Inputs, Crude Oil Inputs, Refinery Operable Capacity, Percent Utilization of Ref. Op. Capacity (%) Table at this Link

Jeff Bailey : 6/6/2007 11:21:20 AM

11:00 Internals found at this Link

Jane Fox : 6/6/2007 11:12:50 AM

All markets are below ON lows now. Link

Jeff Bailey : 6/6/2007 11:11:38 AM

Most recent dividend on TLT was $0.32/share.

At $85.51, SEC Yield would be 4.49%.

Jeff Bailey : 6/6/2007 11:09:11 AM

Disclosure: I currently hold bullish position in the TLT

Jeff Bailey : 6/6/2007 11:08:34 AM

Bullish swing trade long alert ... for 1/2 position in the iShares Lehman 20-year (AMEX:TLT) $85.51 +0.08% ... Stop goes $87.48, Target $87.80.

Keene Little : 6/6/2007 11:04:40 AM

My alarm went off on CME after it tagged 545 which is where it hit its downtrend line from January and its previous high in May. It's looking a little overbought on daily stochastics which makes me wonder if it'll have enough horsepower to break resistance here or first pull back a little and build up some steam (for the bullish wave count). Link

It's a good place to short CME with a tight stop just above today's high of 545.50--quick test to see if the high for this leg has been put in. Then the form of the pullback (assuming we get one) will provide some clues as to whether it's pulling back correctively, getting ready to charge higher, or impulsively to start the next leg down as per the bearish wave count.

Jeff Bailey : 6/6/2007 11:00:27 AM

11:00 Market Watch found at this Link

Jeff Bailey : 6/6/2007 10:56:23 AM

EIA's Crude Oil # Days Supply should come in at about 22.08. Down a tad from last week's 22.10.

Jane Fox : 6/6/2007 10:55:56 AM

This is a get short and stay short kind of day. Link

Keene Little : 6/6/2007 10:52:24 AM

I redrew the parallel up-channel for the DOW's rally since the March low, this time using the EW guide to "channel making". I drew in a trend line from the 1st to the 3rd wave (best guess on where wave-3 ended) and then attached a parallel line to wave-2. That typically defines where the 4th wave pullback will find support. Currently the bottom of this channel is near 13465. Link

This chart is bullish, pure and simple. It's calling for a 5th wave rally that will take the DOW just above 14K if it can get there by the end of next week. Will it happen? We'll know by next Friday.

Jeff Bailey : 6/6/2007 10:52:00 AM

EIA Weekly Crude Oil, Gasoline, Reform. Gasoline, Total Distillate and Diesel Stockpiles Table at this Link

Jeff Bailey : 6/6/2007 10:38:13 AM

ES/SPY will likely trade weakest today.

Jeff Bailey : 6/6/2007 10:36:59 AM

FTO $40.70 -3.48% ...

Keene Little : 6/6/2007 10:36:10 AM

Trannies are getting their clock cleaned today--down -2% here.

Jeff Bailey : 6/6/2007 10:34:36 AM

VLO 74.29 -2.27% ... hit on big build in unleaded.

Jeff Bailey : 6/6/2007 10:33:23 AM

Mass confusion in the energy pits on EIA inventory data.

Jeff Bailey : 6/6/2007 10:31:06 AM

CME 544.90 +1.20% ... testing downward bar chart trend.

Jeff Bailey : 6/6/2007 10:30:27 AM

PTR $133.75 -1.58% ...

Jeff Bailey : 6/6/2007 10:30:04 AM

VLO $75.13 -1.17% ...

Jeff Bailey : 6/6/2007 10:29:48 AM

US Oil Fund (USO) $50.12 +0.19% ....

Keene Little : 6/6/2007 10:29:46 AM

There is a potential pattern that I'm considering on SPX that will be worth watching if SPX drops down to near 1515 to an uptrend line from the May 10th low. The way price has chopped higher (overlapping highs and lows) in May suggests a topping pattern which is typically an ascending wedge. Less common but just as bearish is an expanding triangle instead of a contracting triangle. Link

While it's possible the last high on Friday June 1st was THE high, the pattern of the decline since then is telling me it's not. Therefore another rally leg from this decline is a distinct possibility and it might look something like I've depicted--back up to the top of the triangle (little throw-over) and tag its Fib projection at 1566.

A drop below 1515 would be a bearish heads up and below 1505 would negate the bullish pattern. A rally back above 1532 would say the bulls are back.

Jeff Bailey : 6/6/2007 10:28:59 AM

Hmmm... SMH component breadth 11 up and 7 down. XLNX +1.82%, AMKR +1.53%, BRCM +1.48%

AMD -2.14%, LSI -2.29%

Jeff Bailey : 6/6/2007 10:27:11 AM

SMH $36.66 +0.08% ... inches green. All other equity-based indexes still red.

Jeff Bailey : 6/6/2007 10:24:49 AM

EIA Weekly Inventory data due out in 5 minutes.

Jeff Bailey : 6/6/2007 10:23:49 AM

Current OPEN MM Profiles that I've made and Watch List at this Link ... Some continued speculation that AMTD and ETFC will merge.

Jeff Bailey : 6/6/2007 10:18:40 AM

MBA Weekly Application Table with DJUSHB benchmark at this Link

Jeff Bailey : 6/6/2007 10:12:14 AM

VIX.X alert! 14.65 +7.30%

Keene Little : 6/6/2007 10:10:57 AM

SPX 1518.70 is a 62% retracement of the leg up from May 24th which should be about the limit of this pullback if there are more highs to come (which would make the rally pattern from March look better). The 20-dma is at 1518.34 so it's another reason to look for support in this area.

Jeff Bailey : 6/6/2007 10:06:52 AM

MBA's Weekly Application Survey at this Link

Keene Little : 6/6/2007 10:06:10 AM

Correction to my last post on NDX--I was looking at where NDX could head down to if it stays within the down-channel for a few more days. If it drops back down from here (doing so as I type) then the bottom of the channel is currently near 1913 and 1913.68 is a 38% retracement of the leg up from May 24th.

Jeff Bailey : 6/6/2007 10:05:01 AM

10:00 Market Watch found at this Link

Jeff Bailey : 6/6/2007 9:57:24 AM

Fed Focus ... The Fed has stated that productivity is one of the "key" measures it will focus on in its fight on inflation.

Jeff Bailey : 6/6/2007 9:56:27 AM

Productivity Falls in 1st Quarter ... AP Story Link

Jeff Bailey : 6/6/2007 9:55:19 AM

Major US Economic Report

Nonfarm Productivity Q/Q +1.0% (consensus 1.1%) Vs. previous +1.7%.

Unit Labor Costs Q/Q +1.8% (consensus +1.3%) Vs. previous +0.6%.

Keene Little : 6/6/2007 9:52:40 AM

The bottom of the down-channel shown on last night's NDX chart is currently near 1905 which is a 50% retracement of the rally leg from May 24th. The DOW is now hitting a potential support level around 13525 but SPX is pushing slightly below its 1522-1523 support level. To me the RUT shows more downside potential so things look a little more bearish this morning than I expected. But the bottom line is that we're in a choppy price pattern so a strong bounce out of this is entirely possible.

Jeff Bailey : 6/6/2007 9:46:20 AM

European Markets: ... were/are broadly lower with the FTSE-100 down 51 points, or -0.78% at 6,580. Germany's DAX down 97 points, or -1.23% at 7,822, while the CAC-40 is off 36, or -0.60% at 6,041.

Jeff Bailey : 6/6/2007 9:43:30 AM

Asian Markets: ... were little changed and saw mixed results on Wednesday. Japan's Nikkei 225 finished down 12 points, or -0.07% at 18,040. China's Shanghai was up 9 points, or 0.24% at 3,766 while the Hang Seng edged down 25 points, or -0.11% at 20,818.

Jeff Bailey : 6/6/2007 9:38:52 AM

ECB Raises Benchmark Rate 25bp to 4.0%

Keene Little : 6/6/2007 9:36:29 AM

Watch for a retest of the pre-market lows in the futures and that could get the cash indices down to potential support at the same time.

Jeff Bailey : 6/6/2007 9:36:25 AM

Bullish swing trade stop alert for Advanced Micro Devices (AMD) $13.80 -1.50% ...

Jeff Bailey : 6/6/2007 9:33:15 AM

Brazil May Motor Vehicle Exports Up 16% Vs. April

Jane Fox : 6/6/2007 9:14:03 AM

And there is the US$ breaking its overnight highs. Link

Jane Fox : 6/6/2007 9:12:19 AM

The NAZ needs to trade back into this regression channel that it has been building since November of 2006 and I see a return to its 50EMA before its next attack on yearly highs. I'm thinking June will be a tough month for bulls. Link

Keene Little : 6/6/2007 9:06:53 AM

Another gap down to start the day. So we'll get the leg down that I showed in the charts posted last night (below) and then watch to see if the market finds support early and starts to rally again (blowing out the shorts).

Jane Fox : 6/6/2007 9:06:15 AM

Same story for the DOW. Link

Jane Fox : 6/6/2007 9:03:55 AM

A lot of talk yesterday about all the bearishness but as you can see SPX hasn't even tested its 20EMA yet, however, it may today because the overnight S&P futures are just about to test its 20EMA. I have been short term bearish based on the MACD and have some DIA puts expecting the markets to take at least a breather and retrace a tad before launching the next attack at yearly highs.

Another reason I am short term bearish is the the relationship between the 20EMA and 50EMA. If you take a look back to August 2006 when the 20EMA crossed above the 50EMA you will see how these two MAs have trended closely with the 50 just under the 20. I believe the SPX will either retrace or just move sideways so these two MAs can get back in sync. Link

Jane Fox : 6/6/2007 8:46:59 AM

Gold has broken its PDL and is not looking too healthy. My $ chart is on a 20 minute delay but I bet it is breaking its ON highs.

DAX is telling me the DOW bears will control at least the morning trading that is unless we have buy programs kick in and you just never know when that will happen. Link

Jane Fox : 6/6/2007 8:39:50 AM

ER is testing its PDL as I type, both ES and YM have broken their PDLs and NQ is not quite to its PDL but on its way. NQ closed the strongest on Tuesday so you would expect it to be the last market to test PDLs. Link

Jane Fox : 6/6/2007 8:31:42 AM

WASHINGTON (MarketWatch) -- The number of job reductions announced by big U.S. companies inched slightly higher in May to 71,115, up 32% compared with the same month last year, according to an unscientific tally compiled by outplacement firm Challenger Gray & Christmas released on Wednesday.

May's job-cut total was virtually identical to April's 70,672.

The computer industry led the way in May, cut 13,631 jobs, including 8,800 jobs announced on the last day of the month by Dell Inc.

So far in 2007, financial services have cut the most jobs -- 55,025 -- followed by automotive with 34,731. Computer companies have slashed 28,526 positions.

May is the second consecutive month with higher layoffs than the corresponding month of 2006. Through the first five months of the year, companies have announced 337,773 job cuts, 8.5% fewer than through the first five months of 2006. "But the gap is rapidly closing," Challenger said in a press release.

Jane Fox : 6/6/2007 8:30:25 AM

LONDON (MarketWatch) -- The European Central Bank on Wednesday made its eighth rate rise in 19 months, tightening rates by a quarter-point to 4% as European economies including Germany continue to expand at a healthy pace.

The ECB, which sets rates in the 13 countries that use the euro as their currency, moved the base rate to 4%, its highest level since before the Sept. 11 attacks in New York that impacted the global economy. The rate hike was expected after recent speeches from European Central Bank officials

Jane Fox : 6/6/2007 8:29:37 AM

LONDON (MarketWatch) -- Fiscal imbalances pose inflation risks, Cleveland Fed president Sandra Pianalto said at a conference in Frankfurt. She noted the imbalances were in both the U.S. and Europe. "Unless the deficit problem is addressed through explicit fiscal policies or changes in national saving rates, creditors might reasonably conclude that debtor governments will resort to inflationary policies. Ultimately, however, central banks cannot control either fiscal policy adjustments or private consumption decisions. If fiscal dynamics don't improve, central bankers could once again face the difficult challenge of maintaining price stability in a world where expectations are moving in the wrong direction," she said. Pianalto is not a voting member of the Federal Open Market Committee.

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