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Jeff Bailey : 8/25/2007 1:40:11 AM

08/16/07 to 8/24/07 Sector Bull Curve Comparison at this Link

Big change in STEEL sector. Not what I'd expect from slowing global economy.

Not a "symetrical inchworm," but one that looks to be moving back up the scale.

TRANsports Non-Air are best positioned at "bull alert" 32%.

MACHinery and CHEMical also well positioned to lead an advance.

InterNET still "bull correction" at 34% (34.29% actual). 28% would be "bear confirmed" (same as July/August of 2006), but reversal back up at 40% would be "bull confirmed."

BIDU Link and GOOG Link and YHOO Link

EBAY Link ... InterNET or RETAil? Has held tough through it all.

Jeff Bailey : 8/25/2007 1:15:05 AM

World Bullish % Bell Curve at this Link

US All Stocks (BPALL) reverses back up to "bear correction" status. Link

Europe is "bull alert" at 38% after falling as low as 28%. Needs 76% to achieve "bull confirmed."

Xetra is "bull alert" at 38% after falling as low as 30%. Needs 88% to achieve "bull confirmed."

London is "bull alert" at 40% after falling as low as 28%. Needs 48% for "bull confirmed."

Shanghai is "bull confirmed" at 82%. Would take 60% to reverse to "bear confirmed."

Tokyo is "bull alert" at 22% after falling as low as 14%. Needs 62% to achieve "bull confirmed." Hasn't been "bull confirmed" since late February when it fell to "bear confirmed" at 68%.

Singapore plunged from 82% in June and achieved "bear confirmed" at 68% in early July. Currently 12% (17.88% actual) and threatens to reverse up to "bull alert" at 18%. Would then need 84% to achieve "bull confirmed."

Canada still "bear confirmed" at 36% (37.66 actual) and needs 42% to reverse up to "bear correction." Then 62% to achieve "bull confirmed."

OI Technical Staff : 8/24/2007 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The Market Monitor has been archived.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.

Keene Little : 8/24/2007 9:47:54 PM

Monday's pivot tables: Link and Link

The DOW, SPX and NDX have the same patterns for their bounce off the low on August 16th and they each look like they're finishing an A-B-C bounce with an ascending wedge (ending diagonal) for wave-C. This bearish interpretation calls for a decline either right out of the gate on Monday or after a small pop higher to give some over-throws above the wedge patterns. 60-min charts:
DOW: Link
SPX: Link
NDX: Link

The RUT has been in a slightly different pattern and it counts best as having completed its A-B-C correction of the July-Aug decline at Thursday's high, 8/23. Friday's rally stopped dead at the downtrend line from July 19th so the bearish count is set up for a decline from here and it will need to start right away on Monday or else new highs for the bounce are likely coming. Link

Jeff Bailey : 8/24/2007 6:02:32 PM

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

I will be out of the office until 8/04/07.

Please sell the OLN-AD if OLN Link trades $28.

Please sell the JNJ-JL if JNJ Link trades $69.

Please sell the DAZ-LN if the DIA trades $144. (see my MM postings today)

Please sell both of the BDQ-UJ if BIDU Link trades $175.75. (BDQ-UJ Imp.Vol. = 63.42)

Please sell the GOP-IX if GOOG Link trades $540.

Jeff Bailey : 8/24/2007 5:42:15 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 8/24/2007 5:37:26 PM

Closing Internals found at this Link

NYSE NH/NL Ratio Chart Link

"f"ive day and 10-day (X,O).

Keene Little : 8/24/2007 4:10:42 PM

The setup looks good for a short on Monday for NDX as well. Link

Linda Piazza : 8/24/2007 3:54:11 PM

I told subscribers earlier in the week that I was using this time of market uncertainty to try out various paper trades and was also putting on a couple of what Dan Sheridan calls "cheap time-bomb butterflies" on the SPY. These are OTM butterflies that he discussed in a webinar. After a big move, for example, he might throw out a couple of these some place where it's possible that prices might move, especially if the big move was accompanied by a big explosion in volatility, and he anticipates a calming of that volatility. I thought conditions fit that, so I established two SPY butterflies, one with the body at SPY 148 and the other with the body at SPY 145. Theoretically, if the SPY was at 148 at expiration, I would recuperate my maximum profit. I did just one butterfly each. The cost of the 148 one, with wings at 146 and 150 was only $0.25, but commissions were way too hefty. The total cost for that butterfly was $63.86, something I was willing to pay just to see how it unfolded (no pun intended). As I type, the SPY is at 148.19. To get out of my butterfly, the bid for the credit I would recoup is $0.05 and the ask is $0.40. So, I don't think I could recoup even my $0.25 debit for establishing it, much less my commissions.

Lesson? First, if you're going to trade butterflies, better have a broker with cheap commissions on combination plays. Mine isn't the cheapest, but I like this broker for other reasons, including the way margin is handled and also the experience of my broker, who really understands options trades and risk management.

If the SPY should linger around 148 into next week and volatility sinks further, the premium on the 2 sold 148 calls might sink further. The intrinsic value on the bought 146 isn't going to change, of course. The effect will be to increase the credit I might now receive on selling the butterfly. I might be able to get out of it and even collect a few pennies or dollars for my efforts.

Maybe not. That's why I didn't go into this with a whole bunch of contracts. There's no substitute for experience, and I want to garner that experience before I try anything at all, and I'd never tried these time-bomb butterflies. I could have paper traded these, but I was willing to pay this $63.86 for this real-live lesson and $53.86 for the one on the butterfly with the body at SPY 145.

You didn't have to pay anything to see how it works. I'll let you know.

Jane Fox : 8/24/2007 3:43:14 PM

The VIX has worked very well today as it does most days, in keeping you on the right side of the trade. Link

Keene Little : 8/24/2007 3:19:00 PM

The rally from last Friday has taken on a larger ascending wedge appearance and has the requisite overlapping choppy rise and bearish divergences. The top of the wedge is a little higher--it could reach the 62% retracement level near 1485 before it tops out. It doesn't have to get up that high and a break of its lower trend line would say we've already found a top. This will be another nice setup for those who want to try a short again but we need to let it finish. Link

Ascending wedges retrace quickly back to their origin so we're looking at a move back down to at least 1420. By extending the rally further (in time and price) it increases the chances that the move will be the entire bounce (pink wave count) instead of just wave-A of a larger A-B-C rally (dark red wave count). So getting short, probably Monday, should be a very good play.

Jeff Bailey : 8/24/2007 3:11:30 PM

03:00 Internals found at this Link

Jeff Bailey : 8/24/2007 3:02:31 PM

03:00 Market Watch found at this Link

Jeff Bailey : 8/24/2007 2:59:42 PM

I think it can, I think it can ... YM 13,380

Linda Piazza : 8/24/2007 2:58:05 PM

The SPX is pressing into and now slightly above 30-minute Keltner resistance that has held it back since Friday. It's been pierced several times since then but the 30-minute candles have always closed back below that Keltner resistance, including yesterday morning's test. That resistance has now been bumped up to about 1473.86. Will the SPX be able to break out this time?

It's Friday afternoon, but I'm not entirely sure. The TRAN isn't yet at a day's high, much less breaking out, although it is rising. The USD/yen isn't going much of anywhere yet, still at 116.12. The euro/yen is at 158.71, not yet over yesterday's high, either, although certainly near today's high.

So, these typically leading indicators aren't leading in any meaningful way, not yet, while the SPX continues to charge higher, at 1475.35 as I type. I didn't see anything that led me to believe in a sustained breakout above Keltner resistance. Doesn't mean it won't be sustained. Instead, it means that it wasn't an ideal long setup and one I would have passed up, even if I had been included to buy expensive options on a summer Friday, which I wasn't.

Jane Fox : 8/24/2007 2:46:55 PM

Here is McMillan's weekly update - The rally that began wit h the monstrous intraday reversal last Thursday (August 16th) continues to run its course. Our inclination is that this rally will shortly diminish and a retest of the lows will takeH place. There seems to be a lot of people looking for a retest -- a fact which one knowledgeable observer cited, while noting that the stock market rarely accommodates the majority. So perhaps, there will not be a retest right away, or even at all. It really doesn't matter a lot, for we don't like trying to pick the exact bottom anyway, but instead would rather wait for a confirmed upside breakout before turning bullish. That requirement keeps one from buying into a continuing downtrend, should one develop.

$SPX has only just barely closed above its (still declining) 20-day moving average, so the rally has not been spectacular, at least in terms of that measure. Perma- bulls on TV, of course, continue to think the botto m is in, merely because $SPX has rallied X points off its low. That is rarely what determines a bottom. There is overhead resistance at 1490-1500 on the $SPX chart, and it could prove formidable, too. The equity-only put-call ratios continue to remain on sell signals. That will be the status quo as long as they continue to rise. Eventually, they will roll over and begin to decline, at which point we'll have buy signals, but that doesn't appear to be on the near- term horizon.

Market breadth has improved a lot in the last week. The oversold conditions that precipitated the bottom are no longer in place. Finally, the volatility indices ($VIX and $VXO) are strongly on buy signals, as they formed large spike peaks on their charts and have declined well below their recent peaks. So, we have buy signals from volatility and breadth, while the longer-term indicators (put-call ratios and the $SPX chart) are not bullish yet. We continue to think that a "W" bottom will form. Regardless, it is upside breakouts over significant resistance levels that determine whether a bottom is in -- it is just easier to spot that if a "W" has been formed first.

Jane Fox : 8/24/2007 2:36:03 PM

Here is your chart of the Gold futures. Link

Jane Fox : 8/24/2007 2:34:58 PM

SAN FRANCISCO (MarketWatch) -- Gold futures climbed Friday, with a decline in the U.S. dollar against other major currencies, rising gold demand and strength in oil prices helping the precious metal score a gain of almost $11 an ounce for the week.

"Gold's summer sleepy season is coming to an end with the coming of gold's time of seasonal strength and peak demand from India and the Middle East and the Christmas jewelry season in the western world," said Mark O'Byrne, director at GoldandSilverInvestments.com.

Gold for December delivery closed at $677.50 an ounce on the New York Mercantile Exchange Friday -- the contract's highest closing level since August 15. It was up $9.10 for the session and ended the week $10.70, or 1.6%, higher.

Linda Piazza : 8/24/2007 2:27:48 PM

The TRAN is on the rise again, although it's not yet above the day's high. That day's high is 4908.15, with the TRAN at 4891.96 as I type. The former rising channel support line, violated yesterday, is now at about 4945, if I'm eyeballing it correctly. Keltner resistance is at 4898.73 on 30-minute closes and then at 4936.44 on 30-minute closes.

Keene Little : 8/24/2007 2:14:38 PM

Today's rally looks like another one of those Fed-assisted rallies where the Fed feeds money into the monetary system through their primary dealers. Keeping the stock market up keeps everyone calm which is what the Fed wants (needs) in order to keep the credit crisis from getting worse (it will). It's a lazy summer Friday and we'll just have to see if people are willing to hold onto their long positions heading into the weekend. The trend is up today so there's no sense in fighting that. Just keep an eye on the uptrend lines.

Jeff Bailey : 8/24/2007 2:39:01 PM

Dow Industrials (INDU) 50-point box chart Link

OK ... DIA's PnF chart still very bullish longer-term.

INDU's 50-point adds some needed "noise" though. After trade at 13,000, the INDU broke its bullish supportThe X column from 12,600 to 13,150 is a "low pole warning" and hints of a longer-term reversal.

From the perspective of a DIA Dec. $144 Call (DAZ-LN) holder, what I'd like to see next week is further STRENGTH (X) up to 13,650. BUT I WANT IT TO STOP THERE!

That would allow for a VERY NICE bullish vertical count column (Current is from 13,050 to 13,300) and not that impressive to 13,800).

The reason I want INDU to stop at 13,650, then PULL BACK, say to current levels of trade, is so the "next" 13,650 sets up firm RESISTANCE, and a pattern that some will call a head shoulder top, where its objective has alread been achieved. (head 14,000 and neckline was 13,255).

Just before the INDU pullback from 13,650, the S&P 500 Bullish % (BPSPX) might rise to 54%. Even more bullish would be 56%, for "bull confirmed."

THEN get the INDU pullback to 13,300, a WHIP back HIGHER and trade 13,700, a spread triple top buy signal.

Then a Mad Money call from Jimmy C. and praise for Bernanke with "Dow 15,000!"

Jeff Bailey : 8/24/2007 2:07:30 PM

YM 13,370 .... "here on Gilligan's isle"

Jane Fox : 8/24/2007 2:05:44 PM

Earlier the VIX was telling us we were in for a rally. Now the markets are consolidating at daily highs telling me there is more to go however, it is a summer afternoon and most bets are off.

Linda Piazza : 8/24/2007 1:57:38 PM

The USD/yen is now at 116.07, going sideways to sideways up. The euro/yen has been continued to climb since its 2:30 overnight low and is now at 158.70. Neither has broken out yet, however. I don't see them giving us strong evidence of what might happen next on equities.

Jeff Bailey : 8/24/2007 1:50:33 PM

Dow Diamonds (DIA) $133.12 +0.72% ... Link

Keene Little : 8/24/2007 1:49:13 PM

I'm back and I see the bears haven't been able to do anything today. SPX is testing yesterday's high and looks like it's going to press a little higher. It's walking up underneath its broken uptrend line from Monday and could make it up to an internal Fib projection at 1475. The price pattern continues to look like an ending pattern so I don't like the upside although clearly that was the place to be today. I still like the downside potential more than the upside. Link

Jeff Bailey : 8/24/2007 1:35:58 PM

YM Long setup cancel alert! from 01:25:46

Jeff Bailey : 8/24/2007 1:34:53 PM

01:00 Internals found at this Link

Linda Piazza : 8/24/2007 1:32:41 PM

The top of the SPX's potential Keltner resistance on the 30-minute charts has been bumped up to 1573.06 on 30-minute closes. What does that mean, "on 30-minute closes"? That means that prices can pierce the level during the 30-minute period but close beneath it and the resistance is considered to have held.

Jeff Bailey : 8/24/2007 1:31:57 PM

YM 13,349 ...

Jeff Bailey : 8/24/2007 1:29:35 PM

For grins ... with YM session high 13,360 ... drag your 0% "dynamic" up to 13,388.

Jeff Bailey : 8/24/2007 1:27:37 PM

Stop will go 13,324. Target is 13,390.

Jeff Bailey : 8/24/2007 1:25:46 PM

YM Long setup alert ... with YM 13,357.

Look to go long 13,361. Stop would go

Jeff Bailey : 8/24/2007 1:13:43 PM

Look at INDU on 5-minute with your conventional longer-term retracement.

Jeff Bailey : 8/24/2007 1:13:15 PM

Might have ANOTHER 50 in it.

Jeff Bailey : 8/24/2007 1:02:42 PM

01:00 Market Watch found at this Link

Jeff Bailey : 8/24/2007 12:50:48 PM

13-weeks ... that's 3 months isn't it.

Jeff Bailey : 8/24/2007 12:49:23 PM

Equities getting a "dose of fuel" as money flows out of very short-term 13-week bills.

Jeff Bailey : 8/24/2007 12:46:57 PM

If YM gets more than 8-points above 13,350, then Keene might not be the only one stuck on an island trying to conserve gas.

Jeff Bailey : 8/24/2007 12:37:58 PM

See the 11:40-45 AM EDT low? See where "dynamic" 61.8% is at now?

Market new it was going here at that time.

Jeff Bailey : 8/24/2007 12:35:51 PM

YM Long cancel order alert! ... from 12:00:27.

Jeff Bailey : 8/24/2007 12:30:11 PM

YM day trader's 5-minute interval chart Link

Linda Piazza : 8/24/2007 12:29:18 PM

The top of that potential Keltner resistance level for the SPX that I mentioned a few minutes ago has moved up to about 1472.50 on 30-minute closes.

Jeff Bailey : 8/24/2007 12:25:11 PM

YM Alert! 13,350 ... would take day trade bull profits if entry was 13,298.

Jeff Bailey : 8/24/2007 12:21:26 PM

YM Alert! 13,333 (Daily R1) ... Pullback just above setup entr was DAILY 38.2% at 13,298.

Jeff Bailey : 8/24/2007 12:20:18 PM

S&P 500 Internal Measures Table BPSPX (Column E) and NH/NL measures (AM and AN) with 5-day NH/NL ratios (AP) (AQ) Link

Linda Piazza : 8/24/2007 12:20:06 PM

USD/yen: 116.02. Euro/yen: 158.25. Both are a little higher than in my 10:53:35 post, but neither has bested yesterday's highs, from which they were knocked back. Nothing much to conclude here yet. This action is certainly supportive of the SPX's move upward within the price channel it's been forming on intraday charts since mid-morning on Friday, but it's not yet forecasting an upside break out of that channel. That means that, unless something changes, you might be careful of potential SPX resistance at about 1472.20 or so on thirty-minute closes. SPX at 1467.65 as I type.

Jeff Bailey : 8/24/2007 12:00:27 PM

YM Long setup alert ... with YM 13,307. Look for a long entry at 13,293. Stop will go 13,280. Target 13,350.

Jeff Bailey : 8/24/2007 11:55:43 AM

S&P 500 Bullish % (BPSPX) Link ... Reversed up to "bear correction" on 08/21/07 with SPX closing 1,447.

It would currently take a higher measure of 56% to achieve "bull confirmed" status (do not be SHORT, be NET LONG account at 56% or greater).

It would currently take a reversing lower measure of 40% (3-box reversal) to revert back to "bear confirmed" status.

Linda Piazza : 8/24/2007 11:42:10 AM

Still no infusions of cash today via repos. As per my 10:18:02 post, that leaves a net draw of $3.25 billion today, unless I've missed something.

Jeff Bailey : 8/24/2007 11:33:41 AM

S&P 500 Index (SPX) 10-point box chart at this Link

See (10:57:33) and (10:42:44)

Jeff Bailey : 8/24/2007 11:16:52 AM

11:00 Internals found at this Link

Jane Fox : 8/24/2007 11:15:45 AM

Here is how the markets are trading in relation to their overnight ranges. You can only see this picture with futures and why I have a tendency to use the futures in my commentaries. Link

Linda Piazza : 8/24/2007 11:14:54 AM

The TRAN's intraday chart shows some potentially discouraging (to bulls) developments: Link Remember that SPX, OEX and Dow prices sometimes are led by the TRAN's actions. There's nothing that proves anything here yet, but watch.

Jane Fox : 8/24/2007 11:13:21 AM

I am either having problems with my charts or things are just so slow that it seems my charts just stop. The VIX has been printing a 21.67 for about 3 minutes now and I am not sure I trust anything I am seeing.

Keene Little : 8/24/2007 11:11:30 AM

I've been without power since last evening and there's no estimate yet when it will be restored. Because I'm on an island and running out of gas for my backup generator I'm going to shut down for two hours to conserve fuel. I'll check back in after lunch and hopefully we'll be out of this grinding price action (on a summer Friday that might be a bit much to ask).

Short against yesterday's high is the right play in my mind and if the market drops then watch first for two equal legs down (SPX 1450.43 now) and if it continues lower then the next Fib target is 1439.21. That 1450 level will coincide with the 30-min 100/130 moving averages so it makes for a good place to take some profits if you're short down to there.

Good luck and I'll be back later.

Jane Fox : 8/24/2007 11:10:16 AM

The VIX making new daily lows is a huge Bears Beware.

Jane Fox : 8/24/2007 11:09:48 AM

Vix is making new daily lows telling me the markets will be making new daily highs real soon.

Jeff Bailey : 8/24/2007 11:03:31 AM

11:00 Market Watch found at this Link

Jane Fox : 8/24/2007 10:58:11 AM

This is a chart of the US$ against a basket of currencies and one I use to take positions or get out of positions in Gold. This chart gives us goldbugs a little heart flutter and we are all thinking, "Is it time yet"? Link

Jeff Bailey : 8/24/2007 10:57:33 AM

S&P 500 Index (SPX.X) 1,463.42 +0.06% ... Daily interval chart with two (2) conventional retracement. Link

"Blue" not much help has 7/16 to 8/16 decline pretty much already marked by "Brown"

Linda Piazza : 8/24/2007 10:53:35 AM

Just as they did yesterday, both the USD/yen and euro/yen are pulling back. Nothing major yet, but watch. Euro/yen: 158.01. USD/yen: 115.87, just above the 10-sma.

Keene Little : 8/24/2007 10:52:30 AM

Today is a bit of a repeat of yesterday--the initial morning pop has been sold into again. Things are looking better for the short play.

Jane Fox : 8/24/2007 10:50:53 AM

The SPX also found support back in June but it has not had the buyers to bring it back to that support turned resistance level. Link

Jane Fox : 8/24/2007 10:49:06 AM

Interesting where the DOW has found resistance, right where it found support back in June. Link

Jeff Bailey : 8/24/2007 10:42:44 AM

S&P 500 Index (SPX.X) 1,464.50 +0.12% ... Daily interval chart with MONTHLY Pivot retracement at this Link

Linda Piazza : 8/24/2007 10:35:29 AM

Of course, one then must puzzle out whether, if the yen carry trade is being buoyed by the rebounding of the euro against the yen, would those borrowed yen be put to work spending euros, presumably to buy European equities or other securities rather than dollar-denominated entities? I'm afraid that's beyond my economic ken. Keene? Jeff? Jane?

However, I do believe that it's better for stability's stake to see the euro rising against yen (as well as the dollar doing so), at least, and worries about the stability of the globe's financial markets has been at least partly responsible for the jitters and weakness we've seen.

Keep in mind that this relative strength we're seeing today hasn't yet amounted to much, though, because of the major resistance that both the euro/yen and USD/yen pairs soon face. They're still just moving around within yesterday's range, and we know how little good that did equities yesterday.

Jane Fox : 8/24/2007 10:32:06 AM

I would like to make a comment about the indices I watch in relation to futures or cash. I have a tendency to watch the futures because they tell me the true picture overnight and where the ON session found resistance and support. I find these levels important to monitor since they can serve as support or resistance intraday. Although the futures trade at a premium to the cash indexes and the absolute numbers do not match the price action does match tick for tick. So in essence, if I make a comment about the SP futures I am making a comment about the SP cash indexes.

Linda Piazza : 8/24/2007 10:27:55 AM

Once again today, the euro looks slightly stronger against the yen (measured by Keltner channels tested and Fib levels approached) than the dollar against the yen. Remember that when we're considering the health of the yen carry trade, the relationship of the euro to the yen is important, too. What I'm saying is that if the euro/yen continues to rise today, that might be somewhat more supportive of equities than would appear likely based on what we're seeing with the USD/yen. However, so far, neither currency pair has topped yesterday's highs from which they were both knocked back, so any strength seen this morning is tentative only, in my opinion. At 158.25 as I type, the euro/yen pair is below yesterday's 159.04 high and approaching both that high and the converging 50% retracement of its drop and the 10-sma, 200-sma and 200-ema's, all between 159.06-159.63. Major resistance, those would appear to be.

Keene Little : 8/24/2007 10:20:32 AM

The quick price spike on the home sales data (and more calls for a housing bottom here, cough) has not seen any follow through yet so there's nothing particularly bullish here yet. Another push higher though could see new highs above yesterday's. It could be just a minor new high though and I'd be reluctant to chase it. The rally since Friday looks more like an ending pattern. A drop to a new daily low this morning is needed to confirm the top is in for now.

Linda Piazza : 8/24/2007 10:18:02 AM

I don't see any repos listed yet today on the website of the Federal Reserve Bank of New York, the entity through which the Fed usually makes it temporary open market operations. I see a $3.25 billion repo from yesterday that expires today but no others in the last 25 transactions. That means that, unless the Fed adds later, there will be a $3.25 billion drain on liquidity today.

Jane Fox : 8/24/2007 10:12:59 AM

These are telling me the bulls have the ball. Link

Jane Fox : 8/24/2007 10:11:00 AM

AD line as how improved to +1082

Jeff Bailey : 8/24/2007 10:08:17 AM

10:05 Market Watch found at this Link

Jane Fox : 8/24/2007 10:08:15 AM

WASHINGTON (MarketWatch) - Sales of new home increased 2.8% in July to a seasonally adjusted annual rate of 870,000 as the inventory of homes for sale dropped for a fourth straight month, the Commerce Department estimated Friday.

Sales were stronger than the 820,000 annualized pace expected by economists surveyed by MarketWatch. In addition, sales in June were revised slightly higher.

Sales are down 10.2% compared with last July. Inventories of unsold homes fell about 1% to 533,000, the fourth consecutive decline. At the July sales pace, the inventory represented 7.5 months' supply, down from 7.7 months in June.

Inventories are down 7% since last July. The median sales price in July was $239,500, up 0.6% compared with a year earlier. The median sales price can be affected by the mix of homes sold from region to region and among different price points.

Keene Little : 8/24/2007 10:04:01 AM

Hmm, I just noticed my SPX price data is not updating on QCharts. I see ES spiking up so unless we get an immediate price reversal off this spike up, then the "next leg down" scenario is in serious jeopardy. And now SPX just updated as I'm typing. All the more reason to be watching several indices and futures.

Keene Little : 8/24/2007 10:00:50 AM

Price action since yesterday's low looks like a very corrective bear flag so it should be just a matter of when and not if it lets go to the downside. The alternate interpretation is that it's winding up for an explosive move to the upside but that's not the higher odds scenario. Yesterday's data from Markettells.com showed negative TICK action which pointed to greater selling pressure. Institutions appear to be selling into the rallies right now and that's another reason I think we'll get another leg down.

Jane Fox : 8/24/2007 9:42:05 AM

AD LIne is a very neutral -186. This may be a very good day to not trade and just watch the bull/bear fight.

Jane Fox : 8/24/2007 9:36:47 AM

I bot some IWM puts yesterday based on these charts. I believe the Russell 2000 would find resistance at its August 8th swing high and wanted to take advantage of the subsequent drop. I expect this drop to make a higher low however, and make a reverse H&S which will signal a bottom and then this market will be free to make new yearly highs. Link

Jane Fox : 8/24/2007 9:30:51 AM

Crude continued to find the $70.00/bl as resistance in a classic support once broken turns to resistance.

US$ is on a downward slide giving Gold a nice boost.

I have put the US$/YEN currency pair on these overnight charts since Linda has been talking about it. I read yesterday that since the BOJ has decided to not raise interest rates the now famous (or maybe infamous) carry trade is alive and well. A carry trade is borrowing money in one currency where the interest rate is very low and using that money to buy treasuries based in another currency where the rate is much higher. Link

Jane Fox : 8/24/2007 9:21:23 AM

Even though durable goods orders surged 5.9% the futures markets remained in their overnight sideways ranges. There was a brief rally right after the report was released but it was sold just about as quickly as it was bought. Link

Keene Little : 8/24/2007 9:16:29 AM

If you're trading ES (since I've been focusing on SPX level), two equal legs up from yesterday's low is at 1470.25. So if we get an early pop higher this morning watch that level for resistance.

Keene Little : 8/24/2007 9:11:26 AM

Equity futures have had a nice recovery off their overnight lows but I always find that suspicious--it's too easy to push the futures higher and get it back to even or positive before the cash open. Many times we find it's done so that there's a better selling price at the open. So with a bearish wave pattern set up and what could be a false push higher in the futures since 6:00 AM, look for early selling. Otherwise continued buying will hit the upside levels I posted last night (below) and have me out of my short positions.

Jane Fox : 8/24/2007 9:11:25 AM

Dateline MarketWatch - Orders for U.S.-made durable goods surged in July, jumping 5.9% on higher demand for airplanes, vehicles, computers, machinery, steel and most other kinds of long-lasting manufactured goods the Commerce Department reported Friday.

Excluding the 10.8% increase in transportation goods, orders rose 3.7%, the fastest gain in two years.

The increase far exceeded the expected 1.5% gain forecast by economists surveyed by MarketWatch.

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