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Keene Little : 12/12/2007 1:50:09 AM

Wednesday's pivot tables: Link and Link

Following the hard selloff on Tuesday I like the setup for a strong bounce on Wednesday to correct the decline and set up the next big leg down (at least that's the way it's setting up and we'll watch to see how it goes on Wednesday). If SPX bounces back up to its broken downtrend line from October, and achieves a 62% retracement, it should make it back up to 1505-1507 (60-min chart): Link . NDX has the same setup with the potential to bounce back up to its broken uptrend line from Nov 26th near 2120: Link

Rallying back above SPX 1511 would have me thinking more bullishly but until that happens I'll be looking for the next shorting opportunity after an expected (hoped for) bounce. Daily chart: Link

Jeff Bailey : 12/12/2007 12:45:18 AM

YM 13,500 ... 5 more points and its smack in the middle (50%) of 10/09 close to recent 11/26 low close.

Jeff Bailey : 12/12/2007 12:37:37 AM

NASDAQ saw 222 issues rising on their charts (3-box reversal higher, or X getting a square) and 235 falling (3-box reversal lower, or O getting a square). There were 20 new buy signals given and 10 new sell signals given for a net gain of +10. There were 56 upward reversals and 126 downward reversals.

Jeff Bailey : 12/12/2007 12:37:33 AM

NYSE saw 265 issues rising on their charts and 272 falling. 18 new buy signals and 11 new sell signals for a net +7. There were 53 upward reversals and 198 downward reversals.

Jeff Bailey : 12/12/2007 12:37:29 AM

Bullish % Updates ... not much change to the major bullish % after today's trade. The early session gains had the bullish % fractions higher. NYSE 46.39% (+0.38%), OTC 32.66% (+0.35%), SPX 54.82% (unch), OEX 57% (unch), NDX 44% (unch).

OI Technical Staff : 12/11/2007 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The Market Monitor has been archived.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 : 12/11/2007 7:03:08 PM

FCEL $11.85 +16.17% ... that's a new 52-weeker. Was trading near one to begin with. Sign stock was in favor.

Stocks already trading new lows ... probably out of favor to begin with. Bear food.

Jeff Bailey : 12/11/2007 6:58:04 PM

Keene! Found it ... Under "Connection" and Hot Lists.

Jeff Bailey : 12/11/2007 6:56:21 PM

Keene! Do you know where the QCharts setting is at?

Jeff Bailey : 12/11/2007 6:55:24 PM

Some of QCharts' New Highs and New Lows today Link

Now if I can figure out how to get more than 20 of each.

Jeff Bailey : 12/11/2007 6:50:26 PM

Stillwater Mining (SWC) $10.34 -4.43% ... well off its August lows of $7.93.

Jeff Bailey : 12/11/2007 6:49:32 PM

An old "pal" of ours ... North American Palladium (PAL) $3.40 -15.84% ...

Do stillwaters run deep?

Jeff Bailey : 12/11/2007 6:42:46 PM

Good gravy ... SLM $31.94 -8.48% ... that's a new 52-weeker.

Jeff Bailey : 12/11/2007 6:31:39 PM

General Electric (GE) $37.03 -1.01% ... Link

Has their finger in about ever piece of the global economy. Stock has NOT given a "sell signal" since giving a reversing higher triple top buy signal at $28 as one of the greatest bull markets in history unfolded.

Jeff Bailey : 12/11/2007 6:13:58 PM

That's OK. It would have been a rhetorical question if I were asking you.

Just trying to get traders to think BOTH sides of the trade.

Keene Little : 12/11/2007 6:07:45 PM

Sorry Jeff. I thought the "?" in your 5:15 post meant "question". My bad.

Jeff Bailey : 12/11/2007 5:49:34 PM

Mentioned SBUX $21.90 -3.65% Link in passing in last night's Market Wrap.

KKD Link in the making? Starting to look like it.

Jeff Bailey : 12/11/2007 5:42:55 PM

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

Jeff Bailey : 12/11/2007 5:42:51 PM

Keene ... didn't ask you a question. In my opinion (based on observation), EVERY day has been a clear short day with a stop just above the high. (wink)

Jeff Bailey : 12/11/2007 5:29:28 PM

NYSE NH/NL Ratio Chart updated with today's measures at this Link

X and O are the 10-day (think longer-term).

f are the five-day (think intermediate-term.

I'm showing a lower case "d" as where today's daily measure would be. Not a 3-box reversal.

See where the "f"ive day NH/NL ratio rose to off the bottom? Up to 50%, but just not enough bullishness to get it above the "old" X of 50%.

In my mind, that's the "turning up" to bullish leadership that wasn't accomplished today.

I think BULLS and BEARS will see today's PRICE highs as important going forward.

Keene Little : 12/11/2007 5:18:47 PM

Jeff, answering your question (5:15), yes, the EW pattern was a very clear short play setup and has been for days as it stair-stepped higher into the FOMC announcement. It was set up for a sell no matter what the Fed said. Poor Benny though--he's getting all the blame and it has nothing to do with him. People are just becoming angry and frustrated and it'll show up in the market through selling.

Jeff Bailey : 12/11/2007 5:15:03 PM

Two stock observations today ... TXN and CSCO at WEEKLY R2. Had "good news," but for some reason, couldn't pull free of their WEEKLY R2s.

Predetermined selling, regardless of no cut, 25 cut, 50 cut, 75 cut?

Jeff Bailey : 12/11/2007 5:01:43 PM

Closing U.S. Market Watch at this Link

10/31/07 Closing Market Watch Link

09/18/07 Closing Market Watch Link

Jeff Bailey : 12/11/2007 4:50:19 PM

NYSE NH/NL were 107:118. DAILY Ratio 47.6%.

5-day NH/NL ratio rose to 51.8%, so 50% on chart.

That's RIGHT AT that old 10-day NH/NL column of X from 46%-50% before the eventual decline to 10%.

In essence, today's high looks "pivotal."

Jeff Bailey : 12/11/2007 4:44:28 PM

I'll say this now and show you one technical reason why later ... "you do NOT want to be short above today's highs."

Jeff Bailey : 12/11/2007 4:29:43 PM

A real "bid puller" at 02:15 today. SOLF $24.83 -8.71% ... went from $27.41 to $26.51 in 2-minutes on 8,734 shares.

Keene Little : 12/11/2007 4:27:57 PM

I'd love to see a big bounce tomorrow and take NDX back up to its broken uptrend line from Nov 26th, around 2120, to set up the next great shorting opportunity. Link

Keene Little : 12/11/2007 4:23:20 PM

It's not much but I'm lowering the stop on my AAPL puts to $197 on the stock--just above today's high as the high should have finished the ending diagonal 5th wave (rising wedge). It needs to break below 187, the bottom of the wedge, to confirm that it's done rallying. A new rally above today's high would have me thinking a little more bullishly so I'd want out of the way if that happens. The rising wedge should be retraced relatively quickly, possibly before the end of the month, so 150 is the downside objective for now. Link

Keene Little : 12/11/2007 4:13:54 PM

We've got a setup for a bounce tomorrow and it could even be a strong one. If today's drop is the first wave down (wave-(i) on the chart) then a 2nd wave bounce could be sharp. A 62% retracement of today's decline for example would take SPX back up to about 1506 and its downtrend line from Oct 11th: Link . That kind of bounce would obviously get bulls excited that they survived the post-FOMC reaction. But it would be an excellent short play setup (another MOAP).

On the daily chart I show how this could play out into the end of the month. I'm thinking Santa Ben didn't even promise the bulls a lump of coal today but instead tossed a stink bomb into the middle of the trading floor. Link

Jim Brown : 12/11/2007 4:03:34 PM

Definitely no short covering. This is not setting up well for tomorrow.

Keene Little : 12/11/2007 3:56:32 PM

No fear from the bears--they're holding short right into the close.

Tab Gilles : 12/11/2007 3:53:47 PM

Google (GOOG) trading just under $700; @ $699.50 -$18.50 (-2.65%)

Jeff Bailey : 12/11/2007 3:53:27 PM

VXN 26.55 +8.85% ... WKLY Piv 25.95, WKLY R1 28.43

Jeff Bailey : 12/11/2007 3:52:25 PM

QQQ-AX are $2.56 x $2.58

Jeff Bailey : 12/11/2007 3:51:33 PM

QQQQ alert! $51.24 -2.5% ...

Tab Gilles : 12/11/2007 3:51:20 PM


Did you catch T. Boone Pickens interview on CNBC earlier?

Sees oil at $100 in 6 months. DUG looks good here!

Jeff Bailey : 12/11/2007 3:49:10 PM

PBT $15.07 +0.87% ...

Jeff Bailey : 12/11/2007 3:48:55 PM

USO $70.39 +1.49% ...

Jeff Bailey : 12/11/2007 3:48:33 PM

SPY $148.30

Jeff Bailey : 12/11/2007 3:48:17 PM

DUG Alert! $40.00

Tab Gilles : 12/11/2007 3:46:55 PM

On October 31st the Fed action was the same thing as todays; a 1/4 point on both the Fed and Discount rate.

October 31st the market rallied with the DJIA +137, S&P +38 & Nasdaq +42. However, on November 1st it sold-off hard -369, -41 & -64 respectively and in a week we saw the DJIA fall 1,000 points.

Will we see the market sell-off today and start to rally tomorrow?

My take is that the street was more pessimistic than the Fed...it wanted more and instead got a tepid statement.

Confused? We have seven weeks until the next FOMC meeting...could we see an inter-meeting move? Or is the Fed confident that things are not that bad as many make it out to be?

Keene Little : 12/11/2007 3:44:42 PM

SPX is now a little more than 2 points away from its 38% retracement at 1478.75.

Linda Piazza : 12/11/2007 3:41:39 PM

I have to leave a few minutes early today. If the SPX can't maintain this support zone that it's testing, some charts suggest that 1474-1476 is next, but we may have to wait until tomorrow to see what occurs. The MOC orders (market on close) orders will be appearing in a few minutes. Anything, from an oversold bounce to further downside momentum remains possible, so just be sure to protect your bearish profits if you're in short-term bearish plays.

Keene Little : 12/11/2007 3:41:00 PM

If you're short (and not wanting to tolerate a big bounce against your position) I'd now have my stop just above the high at 3:30 PM. Let the market take you out there and follow this down. Keep an eye on the trend line along the lows since about 3:00 PM and consider taking profits there if tagged (might do a throw-under).

Jeff Bailey : 12/11/2007 3:33:03 PM

OK ... it is "in the zone" and came darned close to testing that "old" solid red trend.

Jeff Bailey : 12/11/2007 3:32:16 PM

DDM $92.14 -3.58% ...

Jeff Bailey : 12/11/2007 3:31:25 PM

General Electric (GE) $36.91 -1.33% ... spike low on headline has been $36.27.

Keene Little : 12/11/2007 3:30:12 PM

A small bounce here to a lower high and then one more new low could do it for the decline--looks like small descending wedges on the 3-min chart which is an ending pattern. Pull your stops down tight now if still short and consider a long play at a minor new low (scalp only but it could be good for a decent bounce tomorrow morning, maybe even into today's close).

Jeff Bailey : 12/11/2007 3:30:05 PM

GE Sees 2008 Profit Up 10%, But Below Consensus ... Reuters Story Link

Keene Little : 12/11/2007 3:27:56 PM

SPX has dropped slightly below the high on Nov 30th (1489) but the DOW is currently finding some support there (13465). The next potential support for the DOW and SPX are at the 38% retracement of the rally from Nov 26th, at 13376 and 1478.75, resp.

Jeff Bailey : 12/11/2007 3:23:16 PM

QQQQ $51.52 -1.92% ... QQQ-AX $2.71 x $2.72

Linda Piazza : 12/11/2007 3:22:11 PM

The SPX is hitting its 200-sma and converging 10-sma. It's difficult to believe that the downward momentum will get stopped by anything, but short-term bears need to keep their profit-protecting plans in place as these averages are being tested, especially as there's also potential historical support in this area. Decide soon whether you intend to hold overnight. If you don't, then keep tightening your stops so that you're taken out near the bottom, but when a bounce gets going. If you intend to stay in, you need to make some decisions on how much potential post-FOMC volatility you're willing to endure.

Keene Little : 12/11/2007 3:21:01 PM

SPX has sliced back down below 1490 about as easily as it sliced up through it last week. There's no holding the bears back here.

Jeff Bailey : 12/11/2007 3:17:42 PM

Moody's: CDO Traunches Tumbling Into Default Reach $45 Billion

Jim Brown : 12/11/2007 3:15:17 PM

S&P back to 1490 and a clear decision point for the market. A break under 1490 could mean a serious change in market sentiment and a retest of the lows. S&P-1490 has been a key resistance/support level since June.

Jeff Bailey : 12/11/2007 3:09:11 PM

10-year ($TNX.X) went out at 39.94, or 3.994%.

Had it finished ABOVE weekly Pivot, I'd be an eager equity bull. It didn't ...

Jeff Bailey : 12/11/2007 3:06:10 PM

SMH $33.41 -0.83% ... only one not to trade WEEKLY Pivot. Traded WEEKLY R1 this morning. ($33.99)

Jeff Bailey : 12/11/2007 3:04:44 PM

RUT 774.10 -2.16% ... trades WEEKLY Pivot.

Jeff Bailey : 12/11/2007 3:03:59 PM

OEX 695.16 -1.58% ... rings the bell.

Keene Little : 12/11/2007 3:03:46 PM

Be careful chasing this any lower now. Bullish divergences appearing.

Jeff Bailey : 12/11/2007 3:03:30 PM

BIX was first to trade WEEKLY Pivot. QQQQ/NDX were next.

Linda Piazza : 12/11/2007 3:00:49 PM

The USDJPY showed us once again today that it warrants our attention. All day (see my 9:52:18 and 2:06:59 posts), the USDJPY has been suggesting that perhaps the rate-cut rally was front-run. Perhaps the rescue strategy that was devised last week prompted that front-running of the decision, but if the post-FOMC rally had already been front-run, the USDJPY's action all day had suggested that perhaps it could be over.

Jeff Bailey : 12/11/2007 3:00:03 PM

US Dollar Index (DXY) 76.22 +0.20% (30-min delayed) ... at 02:15 PM EST, was trading 76.05.

Keene Little : 12/11/2007 2:58:50 PM

VIX shot higher post-FOMC and that's obviously helping the value of our put play from the high just before the FOMC announcement. Even my AAPL puts are looking a little better now although I'll be happier when I see AAPL below 187, its uptrend line from Nov 16th: Link

Jeff Bailey : 12/11/2007 2:52:05 PM

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

Stopped on the QQQ-AX, but looking to buy IF it trades $2.10.

Jane Fox : 12/11/2007 2:47:20 PM

S&P's low today is that old number 1490. I was speculating this morning that 1490 would no longer be significant because too many people are watching it but so far today it has been support. Link

Keene Little : 12/11/2007 2:43:27 PM

SPX on the other hand broke both its uptrend line from Nov 26th and back below its Oct 11-Oct31 downtrend line at the same place--1507. It has also broken Friday's low near 1502 for the EW pattern sell signal. I'm in short the rallies mode now.

Linda Piazza : 12/11/2007 2:42:43 PM

Short-term bears, it's time to enact your profit-protecting plans in case there's the almost obligatory bounce from this zone. I'm not suggesting that you should automatically sell out all your positions--although those with the most conservative outlooks and who cannot afford to lose any money might consider that or stepping out of partial positions--but rather to lower stops so that your gains won't turn into losses, and to decide whether you want to hold overnight. I could see a further drop toward 1483-1485, but I could also see a bounce begin at any moment, so have your plan and follow it.

Keene Little : 12/11/2007 2:41:25 PM

The DOW has now come back down towards its broken downtrend line from the Oct 11 and Oct 31 highs, currently just above 13500. It should be good for at least a bounce and perhaps a scalp long play.

Keene Little : 12/11/2007 2:39:20 PM

The DOW and SPX have clearly broken their uptrend lines from their Nov 26th lows. Ideally, for another short entry, we'll see both bounce back up for a retest of those lines for a kiss goodbye.

Jane Fox : 12/11/2007 2:36:58 PM

Here are the charts of the previous day ranges. Link

Keene Little : 12/11/2007 2:35:57 PM

NDX did a little throw-over above the top of its rising wedge pattern and then collapsed back under it (sell signal #1). It's now approaching the bottom of the wedge near 2107 and I would expect at least a bounce. If the rally is finished then a bounce followed by a new low would be sell signal #2 (dark red) but stay aware of the possibility for another leg back up to the top of the wedge (pink). Link

Linda Piazza : 12/11/2007 2:35:52 PM

Rolling up to a daily chart shows potential support on daily closes layered from 1485-1494. These come from various moving averages, Fib levels and historical support levels. One of those historical support levels is the neckline of the inverse or reverse H&S that the SPX confirmed when it pushed higher over this last week. So, it must be considered that a drop to that area, while violent, will be a drop back to retest that former resistance area, to see if now holds as support. If you're in short-term bullish positions, your pre-FOMC profit-protecting plans probably took you out of the action after the announcement. If you were testing bearish positions pre-FOMC, then you need to begin forming your own profit-protecting plans as this potential support zone is approached. There's no guarantee that this support will hold any more than it held as resistance when the SPX surged higher, but do know how you'll treat a test of that zone.

Jeff Bailey : 12/11/2007 2:33:17 PM

02:30 Market Watch found at this Link

Jeff Bailey : 12/11/2007 2:30:16 PM

StreetTracks Gold (GLD) $79.67 -0.41% ... (~$796.40 spot)

Jeff Bailey : 12/11/2007 2:29:30 PM

DJ- Canadian Dollar Down Sharply After Fed Decision: USD At C$1.0160

Linda Piazza : 12/11/2007 2:25:25 PM

All day, I've been posting that the USDJPY wasn't reacting as if it were leading equities higher. Now it's confirmed a H&S on its 15-minute chart, one that's been forming since yesterday afternoon. It's at 111.08 as I type, at potential support, but its ultimate H&S target is still lower.

Jeff Bailey : 12/11/2007 2:25:31 PM

FOMC Statement (12/11/07) at this Link

10/31/07 Statement at this Link

Linda Piazza : 12/11/2007 2:23:56 PM

Tentative Keltner support on 15-minute closes exists at 1503.20. The SPX is just below that now, at 1500.64. So far, nothing is stopping the decline, but be aware of this potential support on the 15-minute close. Nope, it's still dropping.

Keene Little : 12/11/2007 2:21:41 PM

Initial reaction is down and now we could get a big bounce and then back down. We'll then have to see if there will be follow through to the downside, as the pattern suggests we will.

Jeff Bailey : 12/11/2007 2:20:35 PM

Swing trade call setup alert! ... for one (1) of the QQQQ Jan $50 Calls (QQQ-AX) for $2.10 in the option should they trade there.

Linda Piazza : 12/11/2007 2:19:58 PM

Be cautious here as there tends to be some volatility after the decision.

What's happening with the USDJPY? It's at 111.40 as I type, testing the neckline of a H&S formation on its 15-minute chart.

Jane Fox : 12/11/2007 2:18:49 PM

Quarter point cut in the discount rate and the market does not like this - so far.

Jeff Bailey : 12/11/2007 2:18:14 PM

Swing trade call stopped alert! on the QQQ-AX at the bid of $3.40.

Linda Piazza : 12/11/2007 2:18:00 PM

That discount rate cut of only a quarter point may be a big disappointment.

Jane Fox : 12/11/2007 2:17:44 PM

1 quarter point cut

Jane Fox : 12/11/2007 2:17:13 PM

Market is starting really move around now.

Jeff Bailey : 12/11/2007 2:16:57 PM

Here we go ...

Jeff Bailey : 12/11/2007 2:16:09 PM

QQQQ $52.75 +0.39% ...

VXN 23.99 -1.64% ...

Jeff Bailey : 12/11/2007 2:14:44 PM

Swing trade call raise stop alert! ... now let's raise the stop on the QQQQ Jan. $50 QQQ-AX) to $52.20 in the underlying QQQQ.

Keene Little : 12/11/2007 2:12:42 PM

From a Fib projection standpoint, if the final 5th wave is to equal the 1st wave in the move up from Dec 4th, it just achieved it at 1521.70. The next upside projection is to 1527.50 which would have it reaching the trend line along the recent highs. This 30-min chart shows the potential to end the rally here or a little higher post-FOMC: Link

Jeff Bailey : 12/11/2007 2:11:26 PM

DJ- Oil Futures: NYMEX Crude Above $90 On Fed, Pipelines

DJ (partial) - Crude oil futures rose above $90 a barrel Tuesday as ice storms stopped flow in key U.S. pipelines and traders bet on a Federal Reserve interest rate cut in a decision expected around 2:15 p.m. EST. Light, sweet crude for January delivery on the New York Mercantile Exchange was recently up $2.50, or 2.9%, at $90.36 a barrel after rising as high as $90.50. Brent crude on the ICE futures exchange rose $2.18 to $90.22 a barrel. The Fed is expected to cut rates by a quarter percentage point, but analysts say a bigger-than-expected cut could drive the dollar down further, buoying crude prices. Dollar weakness has been a big factor in crude's recent run-up to near $100 a barrel, increasing the spending power of traders using other currencies and blunting the potential demand erosion of higher dollar-denominated oil prices. "People are waiting for the Fed decision and whether it will be able to pull crude prices out of their range" of between $85.82 and $90.73 a barrel that they have been trading in since the start of December, said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago. "If there was a 50 basis-point cut it could drive crude above $91; it will be seen as making crude demand more rambunctious" because it increases the spending power of consumers. Still, not all analysts are expecting a bigger drop to be helpful for crude prices because of what it might say about U.S. energy demand. "A counter argument can easily be offered in which a large half percentage-point reduction in rates would generally indicate concerns over a rapidly weakening economy," said Jim Ritterbusch, president of trading advisory firm Ritterbusch and Associates in Galena, Ill. "As a consequence, we feel that the odds favor a lower close today regardless of the Fed's decision." A massive power outage in Oklahoma following an ice storm has suspended operations at major Midwestern pipelines, including three pipelines leading in and out of Cushing, Okla., the nation's largest oil storage hub. Power could be out for up to 10 days, Oklahoma Gas and Electric said. Enbridge Inc. (ENB) shut down its 170,000 barrel-a-day Ozark pipeline after losing power, severing the main route for oil to travel from storage terminals in Cushing to refineries in the Midwest. The company's 125,000 barrel-a-day Spearhead pipeline, carrying Canadian crude to Cushing, is also down, said spokesman Bill Stephens.

Jane Fox : 12/11/2007 2:08:15 PM

VIx is telling me the bulls have the ball. Link

Linda Piazza : 12/11/2007 2:06:59 PM

When you see what's happening with equities, the action on the USDJPY's 15-minute chart is kind of odd. The USDJPY is back below that 15-minute 120-ema after popping back above it for a few minutes. As you might remember, the USDJPY had been bouncing from this moving average since last Tuesday evening, with the equity bounce then beginning Wednesday morning. This currency pair tends to lead U.S. equities at times, although I've questioned whether this intermarket relationship will always continue as it has been in the past. Today, then, the currency pair is being parked at/slightly below near-term support rather than at/slightly above resistance, as the SPX has been. They seem to be going counter to each other. I've wondered if this is a sign that much of the post-FOMC rally was front-run, but this is just musing and nothing definitive.

Jane Fox : 12/11/2007 2:02:06 PM

I am showing a YM long but I will not be taking it of course because of the impending announcement.

Jeff Bailey : 12/11/2007 2:01:24 PM

YM 13,775

Jeff Bailey : 12/11/2007 2:01:11 PM

DDM Alert! $96.00

Jeff Bailey : 12/11/2007 1:59:17 PM

The "primary" reason I think the dollar could rally, is that a rate cut here in the US could push the ECB, which could bring sellers into the euro.

Jeff Bailey : 12/11/2007 1:58:02 PM

US Dollar Index (dxy) 76.17 +0.14% (30-min delayed) ... WKLY Pivot 76.23 still sticky.

Jeff Bailey : 12/11/2007 1:56:23 PM

CHA $78.85 -0.97%

FRX $37.29 -1.76%

ATI $94.94 -0.29%

Jeff Bailey : 12/11/2007 1:53:43 PM

Buying just about everything else ... SPG $101.21 +1.21%

RIO $36.70 +1.43%

GG $34.20 +0.73%

Jeff Bailey : 12/11/2007 1:52:02 PM

Financial Select SPDRs (XLF) $31.96 +0.31% ... good adjustment this morning?

Keene Little : 12/11/2007 1:49:49 PM

The leg up now is potentially completing a 5-wave move up from this morning. That makes it possible that we're completing the rally here and now. There's another interpretation that says we need to see a consolidation that lasts a couple of hours and then another push higher but at this point I'd be very leery about the upside. Bears need to see a break below yesterday's low at this point for a confirmed sell signal now.

Jeff Bailey : 12/11/2007 1:47:25 PM

Hmph ... TXN $33.60 +2.84% ... ditto. WEEKLY R2 ($34.04)

Jeff Bailey : 12/11/2007 1:47:08 PM

Hmph ... TXN $33.60 +2.84% ... ditto. WEEKLY R2 ($34.04)

Linda Piazza : 12/11/2007 1:50:09 PM

As we draw closer to the time for the FOMC decision, the SPX has been parked at the top of its recent range. Clearly, traders are positioning their portfolios to take advantage of a burst higher, if that should occur after the announcement. Clearly, some are anticipating that will be the result of the announcement. Looking deeper for clues on a 15-minute chart, I see that on a Keltner basis, the SPX is weaker than it was the last time it was at this same level. It's below the Keltner line defining the breakout mode, this time finding resistance at that line over the last hour, rather than finding support at that level. What does that mean? So far, all it signals to me is that it's taking a bit more uumph to hold the SPX prices up here than it did earlier this morning. It signals that bulls need to have their profit-protecting plans in place just in case. It does not, however, signal that the SPX can't or won't punch higher after the FOMC announcement. We're certainly getting signals that the SPX is primed to do just that, so it would probably take a massive negative surprise to avert some further upside. Is a 25-basis point cut enough of a negative surprise to keep the SPX from punching higher? Probably not, although it could be viewed a negative if the FED also cuts the discount rate by only 25 basis points. Something negative in the statement might be enough, but it's hard to come up with the exact permutation.

However, even if there's an immediate punch higher, watch the SPX as it approaches the 1532 zone. (See my 9:35:27 post this morning for an explanation.) Remember that the first reaction is not always the final reaction and keep those profits protected. The expected post-FOMC rally has clearly been front run this last week, and who knows how much further it's going to go before there's some profit-taking. The TRAN's daily RSI is at a level from which the TRAN sometimes starts rolling over, so watch the TRAN, too, for signals.

Jeff Bailey : 12/11/2007 1:46:23 PM

CSCO action at a MINIMUM suggests the "news" not yet enough to exhaust computers at WEEKLY R2.

Jeff Bailey : 12/11/2007 1:44:41 PM

Didn't get much "sell the news" on the jobs report on Friday. That'd be about $52.25.

Jeff Bailey : 12/11/2007 1:42:56 PM

I've tried to teach traders to think "both sides" of the trade.

What if I were short into FOMC?

Probably assessing risk to $53.00 now.

Do I cover and see what MARKET reaction is and concede $53?

Keene Little : 12/11/2007 1:42:25 PM

Playing with futures around FOMC is like playing with fire on a California hillside and I try to avoid futures trading until after the dust settles (usually the following day). If you're real quick on the trigger and catch the top or bottom of the move it can be a very good trade. But getting whipsawed out of your trade is too easy.

With an expectation that we're going to see a downside resolution out of this, either right away or after a spike up post-FOMC, and considering the drop in the VIX and VXN since their morning highs, I'd consider a put play before FOMC. It's a bit risky so don't go hog wild but I like the setup for a short play out of this. It might even be another MOAP (Mother of All Puts). We haven't had one of those since leading up into the October high.

Jeff Bailey : 12/11/2007 1:41:23 PM

Actually, the "rally" into the FOMC gives bulls an advantage. Could snug up a stop juuuust under $52.25.

Jeff Bailey : 12/11/2007 1:40:29 PM

QQQQ $52.75 +0.39% ... 60-minute interval chart with MONTHLY and WEEKLY Pivot retracement Link

Jeff Bailey : 12/11/2007 1:18:51 PM

Apple Computer (AAPL) $196.15 +0.99% ...

Jeff Bailey : 12/11/2007 1:16:29 PM

Swing trade call establish stop alert! for the one (1) QQQQ Jan. $50 Call (QQQ-AX) at $51.35 in the underlying.

QQQQ $52.74 +0.38%

QQQ-AX are $3.58 x $3.61.

Keene Little : 12/11/2007 1:05:01 PM

Rallying into FOMC is probably not the best thing for the bulls as this leg up could be putting the finishing touches on the rally. A small consolidation followed by another new high in the next hour could do it. Or perhaps consolidate this leg up from this morning's low right into FOMC and then a final spike high post-FOMC. That's a setup I'd gladly short.

Jeff Bailey : 12/11/2007 1:04:26 PM

CSCO $28.88 +4.41% ... still under WEEKLY R2.

QQQQ $52.74 +0.38% ... WKLY R1 $53.12, WKLY R2 $53.91.

Jeff Bailey : 12/11/2007 1:01:28 PM

75 Minutes ... until FOMC decision on rates.

Jeff Bailey : 12/11/2007 1:00:36 PM

Freddie Sees $5.5B-$7.5B More Losses ... AP Story Link

FRE $33.46 -4.50% ...

Jeff Bailey : 12/11/2007 12:59:01 PM

Ya just never know ...

Jeff Bailey : 12/11/2007 12:58:38 PM

DDM $95.66 +0.09% ...

YM 13,751 (unch)

Jeff Bailey : 12/11/2007 12:50:45 PM

eBay (EBAY) $34.78 +2.74% ...

Jeff Bailey : 12/11/2007 12:50:27 PM

Gilead Sciences (GILD) $46.41 -2.78% ...

Jeff Bailey : 12/11/2007 12:50:08 PM

Oracle (ORCL) $21.54 -0.46% ...

Jeff Bailey : 12/11/2007 12:49:42 PM

Intel (INTC) $27.66 -0.43% ...

Jeff Bailey : 12/11/2007 12:49:24 PM

Research in Motion (RIMM) $102.35 -0.02% ...

Jeff Bailey : 12/11/2007 12:49:04 PM

Cisco Systems (CSCO) $28.85 +4.30% ...

Jeff Bailey : 12/11/2007 12:48:37 PM

Qualcomm (QCOM) $40.57 (unch) ...

Jeff Bailey : 12/11/2007 12:48:16 PM

Google (GOOG) $717.74 -0.09% ...

Jeff Bailey : 12/11/2007 12:47:57 PM

Microsoft (MSFT) $34.94 +0.51% ...

Jeff Bailey : 12/11/2007 12:47:38 PM

Apple Computer (AAPL) $196.26 +1.04% ...

Jeff Bailey : 12/11/2007 12:46:51 PM

QQQQ $52.69 +0.29% .... juuuuust above 61.8% retracement ($52.61) of its recent 10/31 to 11/12 decline.

Linda Piazza : 12/11/2007 12:39:01 PM

The USDJPY is now at 111.80. It's broken back above its 15-minute 120-ema. Just as the TRAN's attempt to break upward failed, the attempt to drive this currency pair below support hasn't been entirely successful. Its move back above the 15-minute 120-ema is tentative so far. This seems part of the pre-FOMC positioning and may not be completely trustworthy, but it's not indicative of great strength yet.

Linda Piazza : 12/11/2007 12:35:43 PM

The TRAN is now at 4873.43. It dropped through that rising wedge after failing to sustain its attempt to break through to the upside. Since that attempt, it has been in a confirmed, if sedate, downtrend. It's been forming consistent 15-minute closes beneath the 15-minute 9-ema, now at 4883.80. Significant short-term support may exist in the 4818-4860 zone, so keep an eye on the TRAN if it should drop into a test of that support.

Jeff Bailey : 12/11/2007 12:31:48 PM

Jan Nat. Gas (ng08f) $7.07 +0.54% ...

Jeff Bailey : 12/11/2007 12:31:22 PM

US Oil Fund (USO) $70.80 +2.06% ...

Jeff Bailey : 12/11/2007 12:28:48 PM

Swing trade long alert! ... for 1/2 position in the Permian Basin Trust (PBT) at the offer of $15.09, LIMIT $15.10. Stop goes $14.60. Target $15.80.

Keene Little : 12/11/2007 12:30:30 PM

The significance of the setup before us is that the bounce off the Nov 26th low has created an A-B-C correction of the Oct-Nov decline. Wave C looks almost complete and that's why one more leg up should finish it off. There are a couple of possibilities for the final 5th wave, from a marginal new high near SPX 1520 to the mid line of its current up-channel near 1530 and then up to a Fib projection at 1545 (for two equal legs up from Nov 26th). Link

I don't consider the 1545 level realistic at this time but it needs to be kept in mind. If at any time price drops back down below 1502, Friday's low, that would be a sell signal and indicate that the rally finished and would be time to look for short entries.

Assuming the A-B-C bounce off the Nov 26th low is the correct EW interpretation we should see a steep selloff follow and then the only question is whether it will drop below the November low or instead only pull back for a couple of weeks and set up another rally leg in the new year.

Linda Piazza : 12/11/2007 12:24:49 PM

Tight, tight range for the SPX. Since the 9:15 candle, it's been squeezed between the 9-ema's resistance and the 45-ema's support on 15-minute closes. A trip up to the top of its smallest channel, now at 1516.13, wouldn't be unexpected.

Jeff Bailey : 12/11/2007 12:23:08 PM

still ...

Jeff Bailey : 12/11/2007 12:22:47 PM

Missed the dividend date ... PBT $15.07 +0.87% ... Link

Jeff Bailey : 12/11/2007 12:20:24 PM

National Temperatures Link .... Brrrrzzzz cold here in the Mile High city. Furnace is running.

Jeff Bailey : 12/11/2007 12:17:14 PM

DDM ... now a 30-minute interval chart. Where are the "key levels?" Link

What's the MARKET's bias?

Where's a BEAR's stop? Where's a BULL's stop?

Jane Fox : 12/11/2007 12:14:14 PM

Well it certainly looks like Gold has decided to defy all odds and move up against the US$. GEESH!! Link

Jane Fox : 12/11/2007 12:11:32 PM

Talk about a mixed picture. We have the VIX and AD volume/ratio in sync and bearish. Then on the other hand the DAX and the USDJPY are in sync as well but quite bullish. Link

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

DDM ... now a 60-minute interval chart Link

Jeff Bailey : 12/11/2007 12:08:55 PM

M, m, m ... now switch to a 60-minute interval chart of DDM. Turn on those QCharts' weekly pivot levels.

Jane Fox : 12/11/2007 12:08:38 PM


You can get options for the gold bugs index.

In Tradestation, find options on symbol $hui.x. It's not a direct play on gold, but will allow you the use of options.

Thanks Michel - this is a good alternative but once again this is an index of Gold stocks which has more influence from the stock market than from Gold itself.

Jeff Bailey : 12/11/2007 12:05:05 PM

Ultra Dow30 (DDM) $95.35 -0.23% ... here's chart per 11:49:39 post Link

Keene Little : 12/11/2007 11:59:10 AM

The indices would still look better with another push higher in order to finish the wave count. At this rate we might not get it until after FOMC. Maybe a post-FOMC spike up and then sell off, either today or tomorrow.

Jeff Bailey : 12/11/2007 11:49:39 AM

There's a decent setup ... DDM $95.24 -0.34%.

Take a retracement from 8/16 low to 10/11 high. Then another from its 10/09 close to recent low close from 11/26.

Good day this afternoon to check any action "in the zone" from $94.44-$94.90.

Jeff Bailey : 12/11/2007 11:43:27 AM

DDM $95.24 -0.34% ... darned near got "the bottom" on it too. Bullish % had not yet reversed up and was still rather uncertain.

Jeff Bailey : 12/11/2007 11:39:06 AM

09/24 to 10/02 action would be nice!

Jeff Bailey : 12/11/2007 11:38:25 AM

When I look at those 12/05 and 12/06 bars on CHA, I get the observation that there was a SHORT being pressed above $80.00. Got things under control, stock eases back lower with a pattern of lower highs and lower lows last three sessions.

BULLS want a "boom!" type of shock above $81.40, bring in some momentum to the upside.

Linda Piazza : 12/11/2007 11:38:19 AM

So far, the SPX is maintaining 15-minute closes beneath the 15-minute 9-ema, but that average is flattening and I wouldn't call this a confirmed downtrend. The Keltner setup looks as if the SPX would have to begin sustaining 15-minute closes beneath about 1511.94 before anything much to the downside would begin. For now, the SPX is just chopping around, which is not surprising on the day of an FOMC decision. The SPX is at 1514.30 as I type.

Jeff Bailey : 12/11/2007 11:35:28 AM

China Tel (CHA) $78.46 -1.46% ... here's my bar chart with some BLUE conventional retracement and current MONTHLY Pivot retracement Link

Keene Little : 12/11/2007 11:32:06 AM

I see AAPL is continuing to climb a little higher. Since recommending a short play on the stock near 193.50 the stock has been chopping its way higher and the negative divergences continue at the new highs (196.83 is today's high so far). I still like the short side on this stock but it's looking like it could work its way a little higher towards my recommended stop at 200. The danger with stops today is what might happen right after FOMC (spiky price action can hit stops both sides before settling on a direction).

Jeff Bailey : 12/11/2007 11:31:23 AM

China Tel (CHA) $78.49 -1.43% ... trying to do the same with a current OPEN MM Profile but with a call.

Stock has been riding bearish support (take a trend from 10/17/07 high to recent 11/28/07 high and extend the trend.

Really need a "gap higher" open above $81.40. Maybe a little bit like the "bearish signal" reversed PnF pattern on the bar chart.

Jeff Bailey : 12/11/2007 11:28:28 AM

Aluminum Corp. China (ACH) $58.23 -3.56% ... remember that one? Was "no bid" at one time. Scrambled on 8/16/07 to close out right at "the bottom"

Jeff Bailey : 12/11/2007 11:26:14 AM

CNOOC (CEO) $174.27 -1.36% ... could be influenced by dollar.

Jeff Bailey : 12/11/2007 11:25:14 AM

SPY $151.84 -0.15% ...

Jeff Bailey : 12/11/2007 11:24:44 AM

SFB-TP was (SOLD Covered) Aug $146 Put, SFB-UR was (LONG) Sep $148 Put.

Jeff Bailey : 12/11/2007 11:22:07 AM

Research in Motion (RIMM) $101.55 -0.81% ... ~$203

Jeff Bailey : 12/11/2007 11:21:15 AM

Valero (VLO) $65.99 +0.03% ...

Jeff Bailey : 12/11/2007 11:20:43 AM

Permian Basin Trust (PBT) $15.04 +0.66% ...

Jeff Bailey : 12/11/2007 11:19:40 AM

August Trade Blotter at this Link ... anything "dollar-related?"

Traded the YM quite a bit that month as well as some other day trades as I was getting ready to leave for a week later in the month. Still some various price benchmarks.

Jeff Bailey : 12/11/2007 11:11:02 AM

Just placed a MONTHLY Pivot retracement on the DXY back in August. If 0% were MONTHLY R2 (82.84) that month, DXY jumped to MONTHLY 19.1% (82.10) on 08/15 and 8/16. MONTHLY S2 was 78.98.

Linda Piazza : 12/11/2007 11:07:45 AM

The SPX has begun closing 15-minute periods below the Keltner line defining its breakout level. I waited until two such closes had occurred to post this to make sure they were sustained at least that long. I'm not sure that we can count on any trend getting started pre-FOMC decision, or immediately afterward, either, but if a short-term downtrend were getting started, you would now expect to see the 15-minute 9-ema perform as resistance on 15-minute closes. That average is now at 1514.63. The breakout level, which one would now expect to be resistance, too, is at 1516.10. The SPX is at 1512.84 as I type.

Jeff Bailey : 12/11/2007 11:06:02 AM

StreetTracks Gold (GLD) $79.84 -0.20% ... (~$798.40 spot)

Jeff Bailey : 12/11/2007 11:05:15 AM

Goldcorp (GG) $33.88 -0.20% ...

Jeff Bailey : 12/11/2007 11:04:13 AM

US Dollar Index (DXY) 76.088 +0.03% ... Updated daily interval bar chart with MONTHLY Pivot retracement at this Link

Buyers continue to lurk at MONTHLY Pivot, and for now, that should keep a lid on gold.

August's MONTHLY Pivot was 80.91, when DXY held closes above for eight (8) sessions.

Jane Fox : 12/11/2007 11:01:20 AM

It is becoming quite obvious that the SPX is ready for a retracement but FED announcements always throw a monkey wrench into technical analysis so I would not be trying to short this market just yet. Link

Keene Little : 12/11/2007 10:58:43 AM

I was playing around with moving averages on the 30-min chart and noticed the 18-period moving average has done a good job on the DOW and SPX at identifying support and resistance during a trend. The DOW has just pulled back to it, near 13697, again this morning: Link

Jeff Bailey : 12/11/2007 10:52:06 AM

EIA: US 2008 Gasoline Demand Seen +1% At 9.4 Mln B/D

Jane Fox : 12/11/2007 10:51:50 AM

AD Line is -350 so the bears are getting stronger

Jeff Bailey : 12/11/2007 10:46:59 AM

QQQQ $52.60 +0.11% ...

Jeff Bailey : 12/11/2007 10:46:24 AM

AT&T Enlists Cisco To Bolster Network Amid Traffic ... IBD Story Link

CSCO $28.92 +4.55% ... pressed against WEEKLY R2 ($28.92)

Jane Fox : 12/11/2007 10:44:32 AM

WASHINGTON (MarketWatch) -- U.S. wholesalers worked down their inventories in October, driving their stocks to the lowest level ever in relation to sales, the Commerce Department reported Tuesday.

Wholesalers' sales increased 0.7% in October, while wholesale inventories were unchanged. As a result, the inventory-to-sales ratio fell to a record low 1.09 from the previous low of 1.10. A year ago, the ratio was 1.16.

The typical wholesaler has about 33 days of sales on hand.

With inventories tight, wholesalers would be well positioned if final demand from consumers falters. But if demand unexpectedly picks up, they could be caught short unless U.S. producers and foreign importers can step up production quickly.

U.S. businesses generally have very low inventories, one reason why many economists say a recession remains unlikely despite mounting troubles in the financial and real estate sectors. In the past, poor supply management has led to large overstocks just as demand falters, requiring heavy cutbacks in production and massive layoffs.

Jeff Bailey : 12/11/2007 10:43:40 AM

EIA: US Gasoline Stocks At 201 Mln Bbl, Below 5-year Average

Jeff Bailey : 12/11/2007 10:42:39 AM

XLF's WEEKLY Pivot at $31.03.

Jeff Bailey : 12/11/2007 10:41:59 AM

Financial Select SPDRs (XLF) $31.50 -1.12%

XLF-LG $0.22

VIX.X 21.16 +2.02% ...

Jeff Bailey : 12/11/2007 10:39:40 AM

US Oil Fund (USO) $69.91 +0.79% ...

Jeff Bailey : 12/11/2007 10:39:10 AM

EIA: Mild Slowdown In Global Economy Behind Oil Revision

Jeff Bailey : 12/11/2007 10:38:27 AM

EIA: Global 08 Oil Use Growth Seen +1.6% Vs. 1.7% Month Ago

Jeff Bailey : 12/11/2007 10:37:44 AM

EIA: US 2008 Oil Demand Seen 21 Mln B/D, +1.2% Vs. Year Ago

Jeff Bailey : 12/11/2007 10:36:58 AM

EIA: US 2007 Oil Supply Revised -60,000 B/D

Jeff Bailey : 12/11/2007 10:36:33 AM

EIA: US 2007 Oil Demand Revised -30,000 B/D

Jane Fox : 12/11/2007 10:36:33 AM

The DOW futures have now broken overnight lows and the S&P futures are testing its overnight lows. Link

Linda Piazza : 12/11/2007 10:35:55 AM

At 4904.51 as I type, the TRAN is now testing the lower trendline of its rising wedge. This occurs after it attempted but failed to punch up through the upper trendline. I'm being a bit wary of any conclusions this morning, but short-term SPX, OEX and Dow bulls don't want to see the TRAN fail this support test, especially if that failure is followed by a steep decline. The TRAN often leads those other indices.

Jeff Bailey : 12/11/2007 10:33:28 AM

Swing trade call cancel stop alert ... for the one (1) XLF Dec. $33 Call (XLF-LG).

XLF $31.58 -0.87% ...

XLF-LG $0.23 x $0.24.

For $22.00, I think it is worth the wait to see what kind of market reaction we get this afternoon.

Linda Piazza : 12/11/2007 10:11:47 AM

The TRAN is at 4914.61 as I type. It's back inside the rising wedge after failing its breakout attempt, but it hasn't broken through the bottom support, either, with that now at about 4901.60.

In truth, I don't know how much these little jits and jots back and forth matter today. Remain wary about trusting any indicator, any index's evidence. Just stay on your feet.

Keene Little : 12/11/2007 10:11:33 AM

The small consolidation/pullback this morning should lead to another push higher but I'm not expecting anything big. The techs are showing the most bullishness this morning but I see resistance dead ahead near 2144, only 2 points higher.

Linda Piazza : 12/11/2007 10:03:09 AM

The TRAN just closed its 15-minute period only juuust above the trendline of that rising wedge shape on its 15-minute chart. That's not a convincing breakout, at least in my opinion. Be careful, SPX, OEX and Dow bulls. Keep the TRAN on your radar screen now that it's attempted to break upward but hasn't convincingly done it. You want it to continue to climb, and you definitely don't want it to drop below 4900. It's at 4927.50 as I type, pulling back a little.

Linda Piazza : 12/11/2007 10:00:49 AM

Looking at all the indicators and indices that I typically watch, I'm getting a mixed view this morning. Does that predict chop? It could. What it definitely predicts is some uncertainty about what happens next, which isn't an unusual prediction for the day of an FOMC decision.

Linda Piazza : 12/11/2007 9:59:40 AM

The TRAN's evidence is opposite that of the USDJPY. The TRAN has broken higher above its latest congestion zone this morning. Its shape on the 15-minute chart from Friday through yesterday had begun to look a little like a rising wedge pattern, a bearish pattern, but this push higher is above the upper trendline of the wedge, negating its bearish aspect. If the TRAN should close this 15-minute period below about 4927.30, the candle will have pierced that trendline's resistance but then closed back below it, but for now the value is 4934.82 and above the trendline. You SPX, OEX and Dow bulls don't want to see a quick reversal down through the bottom trendline of that wedge, though, at about 4900 currently.

Linda Piazza : 12/11/2007 9:52:18 AM

Could the rate-cut rally have already occurred? I'm watching the USDJPY this morning for clues. For the first time (other than one 15-minute period) since last Tuesday evening, the USDJPY has begun closing 15-minute periods beneath its 120-ema. These closes beneath that benchmark have just begun, so the evidence is tenuous so far, but keep it on your radar screen.

Jane Fox : 12/11/2007 9:44:09 AM

Can you suggest a proxy for gold for the non futures playing people?

GLD is an ETF based on the futures and not the Gold stocks and it is the only vehicle I will use when trading Gold. Unfortunately though it does not have options.

Jane Fox : 12/11/2007 9:40:35 AM

The VIX makes new daily highs as the S&P futures make new daily lows.

Linda Piazza : 12/11/2007 9:40:47 AM

On a short-term basis, the SPX has been in breakout mode on its 15-minute chart since last Thursday afternoon, other than a brief close back below the line defining the breakout mode late Friday afternoon. That's a long time to maintain breakout status, long even for this volatile market. The line defining breakout status is now at 1513.92 on 15-minute closes, so sustained 15-minute closes beneath that line erases the breakout status and means that the strongest momentum has eased, at least temporarily. And that "temporarily" is key. As I warned yesterday, don't trust any technical setups too much today ahead of the FOMC meeting because it's all about positioning ahead of that meeting, no matter what the technicals might be saying. The SPX is at 1516.81 as I type.

Linda Piazza : 12/11/2007 9:35:27 AM

Since early 2003, the SPX has been climbing inside a big rising price channel. On 11/26 and 11/27, the SPX was approaching/testing the bottom support of that price channel, at least as I've drawn it on my charts. At about 1532 or so, the SPX will be hitting my version of the midline of that price channel. That's a long, long distance to go in such a short time period. Sometimes, over the last four years, the SPX pauses for a period at the midline, either consolidating for a while or rolling down from it. On 9/18, it pushed right through it with a massive gain that day. Know ahead of time what you'll do if you've got bullish gains and the SPX should spike up to that level pre-FOMC decision or post-FOMC decision.

Jane Fox : 12/11/2007 9:33:09 AM

AD line opens at a neutral +284 and I suspect it may not get to over +1000 or under -1000 before the Fed announcemnt.

Keene Little : 12/11/2007 9:26:11 AM

It looks like we'll start the trading day in the middle of the overnight trading range. The wave pattern is set up for a rally but I'm thinking it could be a choppy one that uses up the time into FOMC. I'll be watching to see if any trades set up but I have my doubts--no sense forcing trades on a day like today.

Jane Fox : 12/11/2007 9:24:39 AM

SPX needs a to retrace and, like I said yesterday, when it does I think it could break the 1490 support because 1490 has become too obvious to market participants. I believe 1460 could be the level of support for the next retracement. Link

Jane Fox : 12/11/2007 9:17:44 AM

The fact that I am seeing bullishness in the US$ of course has huge ramifications on the Gold market. Yesterday I showed a chart of Gold and noticed the bullish green candle. Then I looked at the charts of Crude and the US$ and said I did not think this breakout would hold. Link

Jane Fox : 12/11/2007 9:10:26 AM

The US$ looks to be making a higher high and may be building a lopsided bullish reverse head and shoulders. Link

Jane Fox : 12/11/2007 9:07:04 AM

This is what you call a consolidation pattern at previous day highs and suggests the markets will move higher intraday. The only problem I see is that the last swing low as a new overnight low and, other than the DOW futures (YM), the markets have not regained overnight highs. I may be nitpicking here but, although this pattern is bullish, it is not as overly so. Link

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