Option Investor
Printer friendly version
Jeff Bailey : 11/28/2007 2:21:44 AM

CBOE's DJX Option Montage with 11/27/07 action Link

Not at the 129, but the 130.

Jeff Bailey : 11/28/2007 2:20:20 AM

There ... that might be it.

Jeff Bailey : 11/28/2007 2:10:01 AM

CBOE's DIA Option Montage with 11/27/07 action Link

Jeff Bailey : 11/28/2007 2:03:14 AM

Checked out both the VXO.X and VIX.X ... see some "downside" action, but nothing unusual.

Jeff Bailey : 11/28/2007 2:02:08 AM

YM recap of Tuesday's trade at this Link

Marking the 10:55-11:00 interval.

Jeff Bailey : 11/28/2007 1:51:15 AM

YM Daily/Weekly/Monthly pivot levels for tomorrow at this Link

DAILY R1's continue to find selling.

YM days it starts out ABOVE a DAILY Pivot have ended red.

Jeff Bailey : 11/28/2007 1:39:20 AM

YM 12,942 ... off 13 points from Tuesday's settlement. Overnight low has been 12,919.

That's 5 points below Tuesday's 11:00 AM EST tick.

Jeff Bailey : 11/28/2007 1:37:05 AM

YM's 5-minute close on Tuesday at 11:00 AM EST was 12,924.

Jeff Bailey : 11/28/2007 1:34:26 AM

Gut feel is that the DXY is going to become more influencial to investor psychology. Tapped its MONTHLY S2 early Tuesday morning.

Treasuries too. So much defensive buying this week/month. Probably takes something north of DAILY R2 and MONTHLY S2 to bring in profit taking and have $TNX.X moving further higher to free up some cash.

NDX/QQQQ only majors to get a close above their WEEKLY Pivots.

VIX has correlative support DAILY S1/WEEKLY Pivot. Ooops, forgot to highlight WEEKLY R1 as having seen trade. Highlighted correlative MONTHLY R2 though. (sold some out the money puts in MM profiles)

DIA's DAILY Pivot marks the 2 million shares.

Jeff Bailey : 11/28/2007 1:11:41 AM

Daily/Weekly/Monthly index pivot matrix at this Link

Jeff Bailey : 11/28/2007 1:01:13 AM

Somebody chunked just over 2 million shares of DIA on Tuesday just before 11:00 AM EST at around $129.00.

Jeff Bailey : 11/27/2007 11:21:43 PM

Closing U.S. Market Watch found at this Link

Keene Little : 11/27/2007 11:18:54 PM

Wednesday's pivot tables: Link and Link

I've been watching the sideways triangle pattern for NDX since the Nov 12th low and Tuesday's close was right at the top of the pattern. Based on this continuation pattern (with the pink EW labels) it's a good setup for the short side with a tight stop just above the line. Too bad it set up at the end of the day which requires holding a trade overnight (more risky lately). The dark red wave count is very bearish and calls for a very hard selloff from here. A break below 1982 would be serious. Link

Labeled in bold black is another possibility for a brief rally to the 2100 area to finish a larger A-B-C rally from the Nov 12th low. A break above 2063 would confirm this move although a break above Monday's 2046 high would suggest that's what's happening. This daily NDX chart shows in dark red how the quick rally up to the 2100 area would fit in a larger decline into the end of the year: Link

The SPX 60-min chart shows the bullish divergences that have been building since the Nov 8th lows. It's no guarantee of a rally soon but it should have the bears treading carefully here: Link . The downtrend line from Oct 31st is currently near 1436 and a little above the projection for two equal legs up from Monday's low (1431.77).

The pink wave count shows a strong decline once this bounce is finished (a break below 1406 could turn very ugly for the bulls and they really don't want to go there). A rally above Monday's 1446 high would suggest a stronger rally will follow and this daily chart shows a potential rally up to the 1490 resistance area. Link

OI Technical Staff : 11/27/2007 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 : 11/27/2007 6:10:25 PM

That was "then" Dorsey/Wright major market bullish % from 08/01/07 to 9/26/07 Link

This is "now" StockCharts.com equivalents


NASDAQ Comp Link

SPX Link

OEX Link


Rarely used as it is so narrow INDU Link

Jeff Bailey : 11/27/2007 5:57:32 PM

And this was "then" ... Market Internals from 08/01/07 going into the SPX "bottom" on 08/16/07 Link

Late yesterday and then early this morning we "sold some premium" with COVERED OUT THE MONEY puts on a couple underlying positions.

Largely and ACCOUNT/TRADE management and observation that we're not only nearing an SPX price level where a turn higher was found, but some of the INTERNAL measures are also SIMILAR.

Here's StockCharts.com's S&P 500 Bullish % ($BPSPX) too Link

Note: On 8/21/07, Dorsey/Wright's BPSPX reversed back up at 40% from a low chart measure of 34%.

Jeff Bailey : 11/27/2007 5:43:55 PM

NYSE and NASDAQ Internals at this Link

NYSE: Notable pickup in volume gives the impression there is building disagreement on where things are headed (for every buyer there's a seller, the more you get, the more volume you get). 5-day A/D ratio (column M) at 50% is ABOVE a more recent 46% from 11/14/07 close, and suggests some bullishness broadening out. Bulls don't like the Nh/Nl today considering PRICE action. Bears don't like the PRICE action. Could be at a pivotal point. NYSE 5-day NH/NL ratio (column AE) tries to firm from inflection low of 7.1%. Needs 14% to get a 3-box reversal higher on our 2% box chart. 10-day NH/NL ratio will follow the 5-day.

NASDAQ: Volume rather steady. NASDAQ 5-day A/D (column T) rising to 46%, but work to be done to get above more recent 47% measure from 11/14/07 close. NH/NL ratios stronger than NYSE. Still has look of "firming" at the bottom, not much leadership. NASDAQ 5-day NH/NL ratio needs 22% for 3-box reversal.

Jeff Bailey : 11/27/2007 5:20:06 PM

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

Trade Blotter Marked to Market Link

Jeff Bailey : 11/27/2007 5:09:21 PM

Excellent comments on CNBC ... discussing Citigroup and how some "volatility" came out of the stock today. That's the options.

Great observation from subscriber today (see 01:41:11 PM) as to yesterday's option action and price benchmarking of C. That's the "implied volatility" too.

Bottom line: The market is efficient, but the BIG VARIABLE with OPTIONS is the volatility measures. Getting PRICE right is tough enough on a stock/index, and VIX/VXO/VXN or implied volatility on a security is another VARIABLE that provides greater challenge.

Staying IN, or AT the money can help remove some of that VARIABLE when volatility is high.

Jane Fox : 11/27/2007 4:30:38 PM

Economic Reports for tomorrow include:

7:00a.m. MBA Mortgage Application Survey. Previous: -5%.

8:30a.m. Oct Durable Goods Orders. Expected: 0%. Previous: -1.7%.

10:00a.m. Oct Existing Home Sales. Expected: -0.8%. Previous: -8.0%.

2:00p.m. Beige Book.

Keene Little : 11/27/2007 4:04:36 PM

NDX has been parked right up against the top of its triangle pattern and that of course leaves us guessing about tomorrow. It's a critical point here as the next move could easily be 100 points in a hurry. Link

Keene Little : 11/27/2007 3:59:33 PM

Just another 200-point day for the DOW. Getting kind of boring don't you think? (wink). The question of course is whether we'll see follow through to the upside tomorrow or just another reversal. It's one reason I really prefer to be flat overnight. The trouble with that approach is the market has tended to move big during the overnight session and that makes it difficult to get in the next day.

Both sides are whining right now and both sides are getting their heads handed to them. It's a volatile time and that makes for a difficult trading time. Capital preservation is key during times like these.

Jeff Bailey : 11/27/2007 3:59:05 PM

NDX/QQQQ not a financial in the bunch. I think PTEN $18.72 -0.47% the only "energy" name.

Jeff Bailey : 11/27/2007 3:58:29 PM

VXN.X 31.02 -7.20% ... session lows here. WEEKLY Pivot at 30.21.

QQQQ still my "bull of choice" at this point. DIA not bad, but maybe a little too much financial. XOM a heavyweight too.

Jeff Bailey : 11/27/2007 3:54:07 PM

The lowest exit we got on DUG was $41.40 on 11/14/07. That level has started to serve as "support" for DUG on tests of 11/20/07 and then again yesterday. Probably when USO tested that very short-term downward trend.

Jeff Bailey : 11/27/2007 3:48:45 PM

The highest exit we got on DUG was $44.00.

Today's low has been $44.81.

Keene Little : 11/27/2007 3:46:27 PM

NDX will need to get above 2035 in order to break above today's high and its downtrend line from Nov 14th (top of its triangle pattern).

Jeff Bailey : 11/27/2007 3:46:00 PM

Dumping some DIG here at $96.14

Jeff Bailey : 11/27/2007 3:45:23 PM

DIG $95.49 -3.16% ...

DUG $45.23 +3.14% ...

Keene Little : 11/27/2007 3:44:54 PM

Two equal legs up for SPX off yesterday's low is at 1431.77 which crosses the downtrend line from Nov 14th early tomorrow morning. If this is to be just a correction of the decline then that will likely be the end of the bounce. A little higher it would meet the downtrend line from Oct 31st, now near 1436. So those will be the two levels to break in order for the bulls to declare they've got something going here.

Jeff Bailey : 11/27/2007 3:43:30 PM

SPY $142.71 +1.24% ...

Jeff Bailey : 11/27/2007 3:43:06 PM

QQQQ $49.92 +1.89% ... who had the conviction at WEEKLY Pivot.

Jeff Bailey : 11/27/2007 3:42:13 PM

NYSE A/D 2,117/1,176

Jeff Bailey : 11/27/2007 3:41:31 PM

NASDAQ A/D 1,665/1,330 ... not fading.

Keene Little : 11/27/2007 3:39:41 PM

The bears who thought they were going to get a repeat performance of yesterday (selling right into the close) just got trapped by that last sharp decline. It looks like a buy program across the board just blew them out of the water. Now we'll see if there will be any follow through buying into the close.

Jane Fox : 11/27/2007 3:39:36 PM

VIX moving down as the S&P futures move upward.

Keene Little : 11/27/2007 3:37:44 PM

Interesting observation from Joe that tells of credit problems with individuals (who are either maxing out their credit cards or having payment problems preventing further use):

My oldest brother owns an advertising newspaper for the past 28 years with a circulation of about 30K in the Philly area. It is one of those free shoppers guide. He takes classified orders over the phone and charges it to a customers credit card. These are orders of about 10-20 dollars each. In the past he would get maybe 5 declined credit cards per year. He now gets 3-5 declined cards per week. Just an observation.

Jane Fox : 11/27/2007 3:20:44 PM

The VIX and S&P futures are in sync today and are back to the mirror image of each other. Link

Keene Little : 11/27/2007 3:12:24 PM

SPX pulled back down to its uptrend line from March 2003 so if it holds the bulls could run this higher into the close.

Jeff Bailey : 11/27/2007 3:01:33 PM

At same time, grabbed NASDAQ NH/NL at 38:108 ... they're 52:247.

Jeff Bailey : 11/27/2007 3:00:45 PM

"Bull ugh!" ... earlier today I grabbed the NYSE NH/NL and they were 12:168 ... now they're 23:358.

Jeff Bailey : 11/27/2007 2:58:16 PM

Overstock.com (OSTK) $22.65 -3.12% ... "Grinch-like" trade so far today. Noted the stock as one to keep an eye on in last night's wrap.

Jeff Bailey : 11/27/2007 2:57:02 PM

TRINQ 0.47 ...

TRIN 0.96 ...

Jeff Bailey : 11/27/2007 2:56:35 PM

NYSE A/D 1,835/1,456

Jeff Bailey : 11/27/2007 2:56:11 PM

NASDAQ A/D 1,474/1,484 ...

Keene Little : 11/27/2007 2:49:35 PM

As part of a whippy pattern it's still possible we'll get another leg up in the bearish triangle pattern I've been showing for NDX. It could of course drop straight from here and yesterday's low is an important level in that regard. Until that happens stay cautious about the short side. Link

Jeff Bailey : 11/27/2007 2:48:01 PM

SPX Option Montage with OI as of 11/26/07 Close at this Link

And the most recent from 11/23/07 with OI as of 11/21/07 close Link

Noting that the SXM-XT is now #2, SXZ-XJ is now #3 OI and the SXY-XJ now #4.

Call side order pretty much the same.

From benchmark, VIX.X has risen from 25.68 to 27.01.

That would equate to greater number of call seller/put buyers than there were call buyers/put sellers.

Remember VIX.X closed 28.91 yesterday (to match changes in OI).

Keene Little : 11/27/2007 2:39:52 PM

Suddenly not looking so bullish here. Needless to say, the bulls best do some buying here or else.

Keene Little : 11/27/2007 2:26:25 PM

This afternoon's pullback could use a minor new low to finish a 5-wave move down from the high near 1:00 PM (might not get it). That could set up a reversal back to the upside. Continue to keep an eye on SPX 1414-1415 for support if we see another drop from here.

Jeff Bailey : 11/27/2007 2:17:11 PM

$VIX.X 27.02 -6.53% ...

Jeff Bailey : 11/27/2007 2:16:52 PM

Companhia Vale do Rio Doce (RIO) $31.00 (unchanged) ... RIO-MG are $5.20 x $5.40 ... RIO-XT are $1.10 x $1.15.

Jeff Bailey : 11/27/2007 2:11:53 PM

YM gave back about 40 points since that release.

Jeff Bailey : 11/27/2007 2:10:55 PM

Fed Discount Rate Minutes: Concern About Downside Economic Risks

Keene Little : 11/27/2007 2:04:34 PM

If this pullback is going to lead to another leg higher then SPX should find support no lower than 1414-1415.

Jeff Bailey : 11/27/2007 2:05:13 PM

GM Option Montage ... with stock relatively unchanged ($-0.09) but volatility lower than yesterday's close Link

May not be an EXACT comparison, but pretty close on the GM-LF. The question is "when was the LAST trade made on the GM-LF yesterday?

Can perhaps see VIX/VXO decline in volatility with GM-LE and GM-XE at the $25 strike.

Keene Little : 11/27/2007 1:53:28 PM

If the market manages to rally a little more, whether this afternoon or tomorrow morning, SPX could make it up to its downtrend line from October 31st, currently near 1438. The bullish divergences that have been building, and the oversold conditions on the daily chart, suggest the current bounce could build into something more (dark red) but we'll have to see how SPX acts around its downtrend line if and when it gets there: Link

Keene Little : 11/27/2007 1:47:26 PM

After this morning's rally the market has been essentially moving sideways. This should be bullish for another leg up. If we get a drop into the 2:00 turn window that might set up a rally leg. Short term it's a little tough to judge right here.

Jeff Bailey : 11/27/2007 1:44:41 PM

Yesterday, we bought one (1) IN THE MONEY ... MO Jan $70 Call, when VIX was at its HIGH OF THE DAY!

WHEN VIX and PREMIUMS ARE HIGH, try to stay IN, or AT THE MONEY for CALL OPTIONS. Should PRICES RISE and VOLATILITY (premiums fall), sometimes it isn't "fair" when the premiums plunge more than the stock rises.

When you're OUT the money, it is all premium. When you're IN, or AT the money, you've got some intrinsic value that can still benefit from higher PRICE.

Jeff Bailey : 11/27/2007 1:41:11 PM

email observation/comment ... I found some interesting activity yesterday in the C Dec $35 calls. I bought some in the morning at 43 cents and then C dropped another 4% and the options dipped to 29 cents and then went all the way back up to 38 cents quite awhile before C stock spiked 3% in the last minute of trading yesterday. The news for C was not announced until well after the market close last night.

Just another example of how efficient and fair our market is, NOT!

Jeff's Reply:Here's a dual chart montage of both the VIX.X (think premiums) and C. Link

I set my cursor boxes at the 10:15-30 interval.

Markets may not be "fair," but they're VERY efficient (in my opinion).

Excellent observation regarding how the OPITION traded relative to the STOCK's price. But understand the impact of what VIX and HIGHER premiums/volatility.

Jane Fox : 11/27/2007 1:10:27 PM

WASHINGTON (MarketWatch) -- Philadelphia Fed President Charles Plosser strongly suggested that he is not in favor of an additional rate cut at the next policy meeting on Dec. 11.

Fed watchers were watching Plosser's remarks closely for any sign that he was softening his tone on further rate cuts given the renewed strains in credit markets over the past two weeks. But there were no such signs.

In a speech at the University of Rochester, Plosser said the Fed cannot resolve the cause of the tension in financial markets, uncertainty over the value of complex securities tied to subprime and other mortgages and who holds these derivatives.

"It is important to recognize that the Fed cannot resolve this price discovery problem. The markets will have to figure this out," Plosser said in his prepared remarks.

Jeff Bailey : 11/27/2007 1:10:09 PM

In my MM Profiles ... I have to be a realist and discount the "bullish bias" exposure at this point that I'd get from the XLF-LG and the CHA-LT.

Ah, but those CHA-LT. That is a "crazy market" and it can turn on a dime and go bonkers.

Jeff Bailey : 11/27/2007 1:07:07 PM

In my mind, I had one other trade I could have put on today, but it didn't necessarily "make sense" as it relates to account management.

I've been more "bearish" on oil-related stocks the last few weeks as depicted with our DUG trades.

For the most part, that has been the "right call."

But with a SFB-XL, would it "make sense" to add another "BEARISH bias" trade to the account?

What if the SPY rebounds 7% over the next couple of weeks?

Oil stocks might gain 3.5% if oil prices hold steady. That's -7% for DUG.

But if the SPY gains 7% over the next couple of weeks, what "should" a bullish bias QQQQ, or QLD do to/for the account?

If things go "in the tank" or lower still, the account has plenty of exposure there.

Keene Little : 11/27/2007 1:05:27 PM

I had mentioned earlier this morning that SPX 1430-1431 could be tough Fib resistance to get through and that could coincide with a DOW rally to its 13039 target.

Jane Fox : 11/27/2007 1:04:37 PM

SAN FRANCISCO (MarketWatch) -- Crude-oil futures fell for a second day on Tuesday, down 3% to below $95 a barrel, on further signs that the Organization of Petroleum Exporting Countries may increase production at a meeting next week.

Crude-oil futures for January delivery declined $3.25 to an intraday low of $94.45 a barrel earlier on the New York Mercantile Exchange. It was last down $2.95, or 3%, at $94.75. Crude closed at a record high closing level of $98.18 last Friday, but has since been falling.

Crude prices have repeatedly run into various headwinds, said Edward Meir, an analyst at futures brokerage MF Global, in a note. "The most pronounced of these is blowing in from the upcoming OPEC meeting, where there is growing talk of another quota rise."

Keene Little : 11/27/2007 1:02:01 PM

There is not agreement in the short term patterns of today's rally but the DOW is looking strong and is now in what appears to be the 5th wave of the move up from yesterday's low. The first Fib projection for it is at 12987 (62% of wave-1) and was just tagged as I type. Then 13039 above that (equality with wave-1) if it can rally a little further. If this is a clean 5-wave move we will then see a pullback to correct the rally so watch for a scalp short play to set up if it manages to reach 13039 (could be a risky short play if it drops from here). The bulls are at risk here in the very short term at least. Link

Jeff Bailey : 11/27/2007 12:59:30 PM

What I was doing yesterday with notes as to OEX, RUT, SPY, DIA and QQQQ was simply getting some observations as to what was leading to the DOWNSIDE as it relates to a pre-defined range of levels within the WEEKLY.

It has been my observation that weakness tends to lead weakness, and trails strength.

Strength tends to lead strength and pulls other things higher.

Certainly there are times when an OUT OF FAVOR or weakest will suddenly come back into favor and become the LEADER.

But that usually takes some type of NEWS, or SUDDEN REALIZATION that change has taken place.

For even the short-term, the QQQQ was the LAST to trade its WEEKLY S1, and the FIRST to trade back up to WEEKLY Pivot.

Jeff Bailey : 11/27/2007 12:53:43 PM

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

Good timing here. SPY at $143.01 with QLD at $100.06. Also has SPY trading RIGHT AT the SFB-XL benchmarked entry.

Jane Fox : 11/27/2007 12:46:13 PM

And in line with a falling Gold and Crude market the US$ is in rally mode. Link

Keene Little : 11/27/2007 12:45:02 PM

DOW 13K could still be formidable resistance--round number as well as the bottom of its broken parallel down-channel from October which has been acting as resistance on the bounces over the past week.

Jane Fox : 11/27/2007 12:44:48 PM

I should have bought a USO put yesterday based on the resistance Crude was facing. That would have been a high probability trade. I just don't like shorting such a bullish market, it is not my style. Link

Jeff Bailey : 11/27/2007 12:44:15 PM

Speaking of cash ... how about the greenback?

DXY 75.22 +0.48% (30-min delayed) ... WEEKLY Pivot at 75.31 yet to be tested.

Jeff Bailey : 11/27/2007 12:43:15 PM

I should NOT forget to mention the 10-year Yield ($TNX.X), which did trade its WEEKLY S2 (38.58, or 3.858%) yesterday.

A lot of cash "hiding out" in Treasuries.

10-year yield ($TNX.X) up biiiiig today. Up 16.1 bp at 4.008%. WEEKLY S1 taken out to the upside at 39.35. WEEKLY Pivot ahead at 40.55.

Keene Little : 11/27/2007 12:40:49 PM

The big question in my mind right here is what will happen when NDX hits the top of its triangle pattern, now near 2037. The rally pattern off yesterday's low suggests that resistance level will break but I'm still thinking of taking at least partial profits on my NQ long play (at 2043) and then reassess based on what it does from there.

Keene Little : 11/27/2007 12:37:59 PM

The pullback from this morning's high looks corrective (overlapping highs and lows) and suggests we haven't seen the highs yet for this move up. It could pull back a little further but unless you're doing quick scalps I'd be looking for an opportunity to buy the dip rather than sell the bounce, at least for now.

Jeff Bailey : 11/27/2007 12:35:09 PM

QLD $99.36 +2.96% ...

Jeff Bailey : 11/27/2007 12:34:39 PM

QQQQ $49.82 +1.71% ... session high of $50.04, a little MORE than its WEEKLY Pivot ($49.84).

Jeff Bailey : 11/27/2007 12:33:48 PM

DIA $129.41 +1.52% ... has kissed its WEEKLY Pivot ($129.45) with session high of $129.53. Right around it now.

Jeff Bailey : 11/27/2007 12:32:48 PM

BIX.X 270.40 +1.50% ... not that close to its WEEKLY Pivot (277.54). Also just kissed/undercut its WEEKLY S1 (268.05) yesterday.

Jeff Bailey : 11/27/2007 12:31:09 PM

VIX.X 26.98 -6.67% .... not that close to its WEEKLY Pivot (25.67).

Jeff Bailey : 11/27/2007 12:30:25 PM

SPY $142.23 +0.90% ... mmmmm... not all that close to its WEEKLY Pivot ($143.77).

Jeff Bailey : 11/27/2007 12:29:12 PM

RUT 740.68 +0.76% ... hasn't come close to its WEEKLY Pivot (751.94).

Jeff Bailey : 11/27/2007 12:28:01 PM

OEX 664.02 +0.94% ... hasn't come close to its WEEKLY Pivot (671.80).

Jeff Bailey : 11/27/2007 12:25:51 PM

Yesterday's Downside Progression to WEEKLY S1 ... was OEX, then RUT, then SPY, then VIX, then BIX, then DIA, then QQQQ (almost to the penny on the Q's).

Has their been upside progression to WEEKLY Pivots?

Jane Fox : 11/27/2007 12:19:39 PM

Recently I have posted charts of the internals telling me the bears have control. Well today I am posting charts of the internals telling me the bulls have the ball. Link

Jeff Bailey : 11/27/2007 12:15:46 PM

Altria (MO) $73.40 +2.70% ... decent "pop" today.

Jeff Bailey : 11/27/2007 12:08:43 PM

Currency Cross Rates screen capture at this Link

Also benchmarked the USO

Jeff Bailey : 11/27/2007 12:02:23 PM

Global Currencies screen capture at this Link

Jeff Bailey : 11/27/2007 11:53:27 AM

EUR/USD 1.4815 x 1.4817

Jeff Bailey : 11/27/2007 11:47:16 AM

Later in the session, I'm going to update our RISK profile of open trades.

We'll think "in the tank" and we'll think "to the moon."

Can the account survive? Can it thrive?

Jeff Bailey : 11/27/2007 11:44:28 AM

Ultra QQQ fact sheet Link

Keene Little : 11/27/2007 11:41:23 AM

The sideways triangle for NDX is bearish (if it plays out) and for that reason it could be a very good setup for a short play. It might do a little throw-over above the top of the pattern and then drop back inside. If that happens I'll be shorting it and is one of the things I'll be watching carefully.

Jeff Bailey : 11/27/2007 11:39:05 AM

Disclosure: I currently hold bullish position in QLD.

Jeff Bailey : 11/27/2007 11:38:41 AM

Understand this trade in relation to being long an SFB-XL.

SPY $142.92 +1.39% ...

SFB-XL $3.60 x $3.65.

Jeff Bailey : 11/27/2007 11:37:15 AM

Swing trade long alert! ... for 1/4 position in the Proshares Ultra QQQ (AMEX:QLD) at the offer of $99.96 +3.60%. Stop goes $95. We'll target $107 for now.

Keene Little : 11/27/2007 11:36:57 AM

NDX is working its way higher towards potential resistance at its downtrend line from Nov 14th (top of the triangle pattern I've been showing), currently near 2038.40. While it could certainly bust right through that on its first try I would think a pullback from it would be more typical. I'll be covering my long play there and watching to see what happens next.

Jeff Bailey : 11/27/2007 11:33:15 AM

Let's do this for the MM Profiles.

Jeff Bailey : 11/27/2007 11:32:59 AM

Rather bullish session building here in the U.S. If looking to play an index long, I'd suggest the NDX/QQQQ.

Jeff Bailey : 11/27/2007 11:29:51 AM

I'd have to think that German CPI data has the euro holding a bid. Can't lean too much to the "ease" side on interest rates.

Haven't figured out what type of central bank policy could curb higher food prices.

Maybe some people would eat less based on interest rates.

Jeff Bailey : 11/27/2007 11:25:52 AM

German Nov. CPI +3.0% On Yr, Highest Since Feb. 1994

DJ- German annual inflation has accelerated to its fastest pace since February 1994, boosted by higher prices for oil products and food items, preliminary data from the federal statistics office showed Tuesday.

The country's consumer price index rose 3.0% on the year in November, well above the market consensus estimate of a 2.7% increase in a Dow Jones Newswires survey of analysts. The CPI rose 2.4% on the year in October.

On the month, the CPI increased 0.4%, surpassing market expectations of a 0.1% rise. The index rose 0.2% on the month in October.

The statistics office also said the European Union-harmonized index of consumer prices increased 3.3% on the year in November after rising 2.7% in October. On the month, the HICP rose 0.5%.

Data from six key German states released earlier showed double-digit percentage annual increases in the price for heating oil in November, the office said. Heating oil and fuel prices contributed about 0.9 percentage points to the overall annual reading, it said.

The preliminary German data was based on the figures from the six key states. Final CPI data is due for release Dec. 14.

Jeff Bailey : 11/27/2007 11:15:34 AM

Citigroup notably weak though. Their paying 11% on the $7.5 billion. That seems "high" to me and probably raises some eyebrows.

Jeff Bailey : 11/27/2007 11:09:25 AM

The Citigroup news hit the wires after yesterday's close and I didn't see it as I was writing the Market Wrap.

That has to be the reason stock futures jumped higher at around 09:45 PM EST.

Jeff Bailey : 11/27/2007 11:06:10 AM

Citigroup Sells Stake to Abu Dhabi Fund ... AP Story Link

C $30.47 -0.74% ...

Keene Little : 11/27/2007 10:53:44 AM

The Fib projection at SPX 1430 (2nd leg up = 162% of the 1st leg up this morning) also matches a 62% retracement of yesterday's drop.

Keene Little : 11/27/2007 10:52:10 AM

In case this morning's bounce is going to be just a 3-wave move watch for where it will have two equal legs up for resistance. SPX is nearing that level here (1421.83). If it can get through this level then the next Fib projection is 1430.

Jeff Bailey : 11/27/2007 10:47:13 AM

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

I grouped the one (1) RIO-MG with the one (1) RIO-XT. The other RIO-MG purchased yesterday (11/26/07) stands by itself with a stop of $33.10 and target of $28.50.

Jeff Bailey : 11/27/2007 10:37:53 AM

Swing trade put establish stop alert! ... for the one (1) Companhia Vale do Rio Doce RIO Jan $35 Put (RIO-MG) entered on 11/26/07 : at $33.10 in the underlying.

Jane Fox : 11/27/2007 10:33:40 AM

Stop hit at 12864.

Jeff Bailey : 11/27/2007 10:27:56 AM

Continue to target $28.50 for the one (1) RIO-MG, but selling some premium and OUT-THE-MONEY on the other, where it obligates us to buy BELOW original target.

Jeff Bailey : 11/27/2007 10:26:19 AM

RIO-MG, which we're currently LONG two (2) are trading $5.60 x $5.80.

Keene Little : 11/27/2007 10:26:04 AM

Wow, first the US dollar is dissed by Greenspan then Gisele Bundchen and now drug lords? Can the dollar sink any lower from here? It certainly could but this is a clear example of extreme bearish sentiment that will likely mark a longer term bottom for the beaten down greenback.

Jeff Bailey : 11/27/2007 10:24:07 AM

VIX.X 27.94 -3.35% ...

Jeff Bailey : 11/27/2007 10:23:39 AM

Swing trade sell covered put alert! ... let's sell some put premium and sell covered one (1) of the Companhia Vale do Rio Doce RIO Dec. $28.75 Puts (RIO-XT) at the bid of $1.30.

RIO $30.28 -2.32% ...

This would OBLIGATE trader to buy 100 shares at ($28.75 - $1.30)= $27.45.

Jane Fox : 11/27/2007 10:22:05 AM

The Canadian $ is now back on par with the US $. The fallout of the rise of this currency against the American $ has been far reaching. I read an article yesterday where a company in British Columbia had to quit mining Gold because the cost of production was rising. Many movie productions use Vancouver as their base because of the advantage they had with the US$ buying so much more in Canada so they are cutting back. Most of the large oil companies drilling for oil in the Athabasca Oil sands are American and have found their production cost rising so they are starting to cut back as well.

I heard a program on the NPR the other day about how the drug trade is now moving into Canada and Europe because drug traffickers do not want to be paid in US$. Link

Keene Little : 11/27/2007 10:19:38 AM

This SPX 10-min chart shows what I mean by a 5-wave move down to a minor new low: Link . The 5th wave down would equal the 1st wave at 1403.38 so watch for potential support there if tagged.

Jane Fox : 11/27/2007 10:34:06 AM

Overnight lows are 12759 so I will raise the target to 12760.

Jane Fox : 11/27/2007 10:15:22 AM

This trade has a little wider stop than I like so I will be managing it carefully.

Keene Little : 11/27/2007 10:15:19 AM

Selling reaction to the CC news so now we'll get to see if the selloff will be bought. The drop from yesterday's high, if it's to be a 5-wave move down (instead of a 3-wave move as part of a larger sideways consolidation), needs one more leg down and that would mean a minor new low below yesterday's (likely with bullish divergences). As I type it appears that's what we might get. Once again it should be a good buying opportunity for a bigger bounce but be careful.

Jane Fox : 11/27/2007 10:14:13 AM

Short triggered so now short YM from 12809.

Jane Fox : 11/27/2007 10:13:47 AM

If triggered stop will be at 12864 and target 12755.

Jane Fox : 11/27/2007 10:13:21 AM

I will be taking YM short at 12809.

Jeff Bailey : 11/27/2007 10:09:40 AM

Richmond Fed: Nov. Mfg. Index 0 Vs. Oct -5

Mfg. Shipments Index 34 Vs. Oct -5
Services Revenues Index -2 Vs. Oct +4
Nov. Retail Revenues Index -19 Vs. Oct. -11

Jeff Bailey : 11/27/2007 10:06:05 AM

NYSE A/D 1,921/1,024

NASDAQ A/D 1,585/974

Jeff Bailey : 11/27/2007 10:04:56 AM

Nov. Present Situation Index 115.4 Vs. Oct 118.0

Jane Fox : 11/27/2007 10:04:52 AM

WASHINGTON (MarketWatch) -- U.S. consumer confidence sank in November on growing concerns about the future, the Conference Board reported Tuesday.

The consumer confidence index fell to 87.3 from 95.2, well below the 90.2 expected by economists surveyed by MarketWatch. It was the lowest level and the biggest one-month decline since Hurricane Katrina in the fall of 2005.

The decline in November was driven by a big drop in expectations, fueled by higher energy prices and falling prices for stocks and homes.

The expectations index fell to a four-year low of 68.7 from 80 in October, while the present situation index fell modestly to 115.4 from 118.0.

Jane Fox : 11/27/2007 10:02:21 AM

Nov. consumer confidence weaker than 90.2 expected

Nov. consumer confidence falls to 87.3 vs. 95.2

Jeff Bailey : 11/27/2007 10:02:08 AM

US Consumer Confidence 87.3 Vs. Oct. 95.2

Keene Little : 11/27/2007 9:58:20 AM

The DOW and SPX are struggling with their downtrend lines from Nov 14th that were broken on Friday and which price dropped back down below yesterday. If they can rally back above, with a push to a new daily high now, bulls will want to see them act as support. Still resistance for now.

Jane Fox : 11/27/2007 9:52:12 AM

Remember the consumer confidence out at 10:00

Jane Fox : 11/27/2007 9:45:30 AM

AD line is now a bullish +1016.

Keene Little : 11/27/2007 9:42:56 AM

They're liking the techs this morning. NDX is up +1.4% out of the gate. If we get a 3-wave bounce up to the top of its triangle pattern today, currently near 2037, it would make for a good profit target on a long play. From there it will be decision time for the market--that will either be the end of the sideways consolidation and we'll head back down in a strong selloff well into next month, or the bulls will be able to break that resistance and drive it higher into the end of the week at least. In the meantime stay cautious for potential whipsaws.

Jane Fox : 11/27/2007 9:37:11 AM

Gold is falling on cue as well. Link

Jane Fox : 11/27/2007 9:36:33 AM

Crude is falling on cue. A triple top at $100/bl was too much for crude to break easily. Link

Jane Fox : 11/27/2007 9:27:34 AM

All American index futures mostly traded in the same pattern overnight and the cash markets will probably gap up when they open. I suspect the AD line to be above 0 but not a lot. Link

Keene Little : 11/27/2007 9:21:10 AM

Equity futures sold off quite a bit after the European markets opened and gave back a good portion of the overnight gains. But even after the big drop we'll have a bullish start to today's trading. I think we're set up for a rally so I'm looking to buy the dips but it could be tricky in the first hour as the bears try to push this back down. Yesterday's lows are critical but I don't think they'll be tested today.

Jane Fox : 11/27/2007 9:19:40 AM

WASHINGTON (MarketWatch) -- U.S. home prices fell 4.5% in the year ending in the third quarter, according to the national Case-Shiller price index released by Standard & Poor's on Tuesday. Prices fell 1.7% compared with the second quarter. It's by far the largest price decline in the 20 years covered by the index. Prices had fallen 3.2% in the year ending in the second quarter. Prices fell in all 20 major cities in September compared with August, and were down 4.9% in the past year. Prices fell 5.5% year-over-year in the original 10-city index. The Case-Shiller index, which tracks multiple sales of the same homes, is considered by many observers to be the best gauge of national and metropolitan-area real-estate values.

Linda Piazza : 11/27/2007 8:57:17 AM

I'll be out of the office today and not contributing to the Market Monitor.

Market Monitor Archives