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Keene Little : 12/20/2007 11:44:39 PM

CME should be interesting to watch as it continues to look as though a sideways triangle pattern is developing which calls for a new high after one more pullback. A quick move higher Friday morning will hopefully be followed by a pullback to a little below 690 and then a final small rally leg to 722-723 to finish it off: Link

GOOG is another one. It seems like there are sideways triangles all over the place and the interesting thing about these patterns is that they're pointing to the possibility for a new market high, probably in Janaury after another pullback. The triangle patterns point to one more new high and that's it (shown in green). But if the current bounce falls short of 725 (700 is an upside Fib projection) and then drops below Tuesday's low near 653 then a quick selloff could follow (shown in dark red). Link

Tab Gilles : 12/20/2007 11:40:46 PM

SPX Looking at the SPX daily chart, note that the 50-ma is about to cross below it's 200-ma?

Link

Is this a negative for the market? Last time this occured was in the summer of 2006 and the markets rallied to an all-time-high!

Will this time be different?

Jeff Bailey : 12/20/2007 11:45:41 PM

Look for DIA close of $134.50 tomorrow.

SPY $149.00

QQQQ $51.50

IWM $77.50

Jeff Bailey : 12/20/2007 11:13:30 PM

Closing U.S. Market Watch found at this Link

Keene Little : 12/20/2007 11:08:35 PM

Friday's pivot tables: Link and Link

SPX and DOW look similar with their sideways triangles and price finished right at the top of the triangles. That sets up a potential drop out of the gate tomorrow, shown in dark red. The pink wave count calls the triangle patterns as part of a larger a-b-c bounce off Tuesday's low so an immediate rally in the morning has some good upside potential (DOW 13400, SPX 1478 area):
DOW: Link
SPX: Link

But the techs and small caps looked stronger on Thursday and are set up for a stronger push higher on Friday, at least potentially. The Nasdaq tagged the first of two possible Fib targets to the upside, 2638 and then 2671 if it continues higher. The RUT's pattern is not nearly as clear so I suspect it will just follow the others
COMP: Link
RUT: Link

OI Technical Staff : 12/20/2007 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The Market Monitor has been archived.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 : 12/20/2007 5:47:29 PM

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

CLOSED out/bought back the one (1) RIO-XZ for $0.35.

CLOSED out four (4) of the QQQ-LY at target of $0.25 at the open (even though open was $0.29, report $0.25)

Now ... STILL HOLDING one (1) of the QQQ-LY with a TARGET of $0.80.

IF WE DON'T get filled PRIOR to tomorrow's close at that target, may decide to EXERCISE that option. (Right to buy 100 shares of QQQQ at $51.00).

Bought one (1) of the QQQ-MW, which may also serve as "insurance" to $49.00 - $0.65 = $48.35 should we exercise the QQQ-LY.

Jeff Bailey : 12/20/2007 4:28:54 PM

Don't forget! Tomorrow is December option expiration.

Jeff Bailey : 12/20/2007 4:28:50 PM

QQQQ using regular session high/low/close of $50.96/$50.20/$50.90 ... DAILY Pivot Levels for tomorrow are ... $49.93, $50.41, Piv= $50.69, $51.17, $51.45.

Note: for remaining QQQQ Dec. $51 Call the overlap at DAILY R2/WEEKLY Pivot.

Jeff Bailey : 12/20/2007 4:20:00 PM

Research in Motion (RIMM) ... Earnings Press Release Link

Jeff Bailey : 12/20/2007 4:16:28 PM

QQQQ went out $50.93 ... $51.11 extended.

Jane Fox : 12/20/2007 4:14:56 PM

Economic Reports for tomorrow include:

8:30a.m. Nov Personal Income. Expected: +0.5%. Previous: +0.2%.

8:30a.m. Nov Personal Spending. Expected: +0.9%. Previous: +0.2%.

10:00a.m. End-Dec Reuters/U Of Mich Sentiment Index. Expected: 74.5. Previous: 74.5

Jeff Bailey : 12/20/2007 4:14:22 PM

Apple Computer (AAPL) $187.21 +2.23% ... $189.00 extended.

Jeff Bailey : 12/20/2007 4:11:17 PM

Research in Motion (RIMM) $106.99 +4.75% ... gets a pop to $113.00 on headline numbers.

Keene Little : 12/20/2007 4:08:33 PM

Well so far RIMM has hardly disappointed--up more than $8 after their earnings.

Jeff Bailey : 12/20/2007 4:08:33 PM

Good Gravy! ... CDE $4.22 +11.13% ...

Jeff Bailey : 12/20/2007 4:04:14 PM

YM 13,336 ... sticks its head above afternoon high.

Keene Little : 12/20/2007 4:01:42 PM

Golf clap for parking it at the highs. The short term pattern is now muddied so the short play is at risk here. Keep your stops tight.

Jeff Bailey : 12/20/2007 4:00:29 PM

TRIN 1.00

Jeff Bailey : 12/20/2007 3:59:27 PM

YM 13,321

Jeff Bailey : 12/20/2007 3:56:56 PM

Here's that QQQQ chart from Monday's Wrap Link

We have seen a 3-box reversal back lower to $49.50 since.

ORCL may have "saved the day!"

Keene Little : 12/20/2007 3:56:14 PM

If I were forced to make a trade on RIMM before the close, based on its EW pattern looking complete at today's high, I would short the stock. My guess, and that's all it is, is that the stock will sell off following its earnings report.

Keene Little : 12/20/2007 3:53:15 PM

They're doing a fine job of holding the market up into the close. High expectations for RIMM perhaps? There's virtually no cushion if you shorted this afternoon's bounce so decide if you want to take the risk for a potential move higher after hours. You can always watch it and then get back in after RIMM reports.

Linda Piazza : 12/20/2007 3:59:25 PM

Aha! After stating that I had never been able to find a way to convert arithmetic charts to semi-log ones on my current charting service, I of course stumbled on the way to convert them an hour or two later. If you want to see the difference it makes in a long-term chart, let's look back at the security that I posted earlier. Arithmetic scale: Link and semi-log scale: Link

Jeff Bailey : 12/20/2007 3:46:30 PM

For those new to the MM, I ;P that RIMM gap from 06/29/07.

Jeff Bailey : 12/20/2007 3:44:40 PM

Juuuuust in case it "ends badly" this time around.

;P

Jeff Bailey : 12/20/2007 3:43:37 PM

VXN.X 23.51 -5.50% ...

Jeff Bailey : 12/20/2007 3:43:04 PM

Swing trade put alert! ... for one (1) of the QQQQ Jan $49 Puts (QQQ-MW) at the offer of $0.65.

QQQQ $50.83.

Jeff Bailey : 12/20/2007 3:32:00 PM

At last night's close, BPNDX was still "bear confirmed" at 34.00%.

Probably only one thing that change that further from here.

One was ORCL, and we'll find out how much, if any after the close.

Jeff Bailey : 12/20/2007 3:28:16 PM

Swing trade call establish stop alert! ... for the one (1) QQQQ Jan. $50 Call (QQQ-AX) at $49.45 in the underlying.

Jeff Bailey : 12/20/2007 3:25:16 PM

I pretty much "know this ..."

Jeff Bailey : 12/20/2007 3:21:37 PM

NQ crept above afternoon high.

Jeff Bailey : 12/20/2007 3:20:34 PM

Just can't get the momentum with YM that NQ has.

Jeff Bailey : 12/20/2007 3:19:42 PM

YM Long stopped alert! 13,315

Keene Little : 12/20/2007 3:18:57 PM

Beginning to wonder if they're going to try their best to hold this up near the highs for the day, as I suspected earlier. This market loves to make big moves during the after hours and start the day with a gap move (to get the cash players scrambling to catch up). A gap down looks like it might in the cards for tomorrow (unless we get a strong rally from here into the close).

Jeff Bailey : 12/20/2007 3:17:19 PM

YM long alert! 13,320. Stop 13,315. Target 13,360

Jeff Bailey : 12/20/2007 3:12:50 PM

Maybe should'a waited until 03:15

Jeff Bailey : 12/20/2007 3:12:34 PM

13,310

Jeff Bailey : 12/20/2007 3:12:26 PM

YM 13,309

Jeff Bailey : 12/20/2007 3:11:48 PM

TRIN's DAILY S1 0.76

Jeff Bailey : 12/20/2007 3:11:18 PM

YM 13,301

Jeff Bailey : 12/20/2007 3:11:10 PM

TRIN 0.92 ...

Jeff Bailey : 12/20/2007 3:08:26 PM

QQQQ $50.75 ... session high has now been $50.92.

Jeff Bailey : 12/20/2007 3:06:04 PM

TRIN 0.97

Jeff Bailey : 12/20/2007 3:05:43 PM

Needed 50% dynamic and DAILY Pivot 13,298/13,303 to hold. It didn't. Be VERY alert this last hour of trade.

Linda Piazza : 12/20/2007 3:06:35 PM

So far, the SPX's Keltner resistance (or historical resistance near here, too) at 1459.90 has held on 15-minute closes. All we know for sure is that there's been no breakout yet above this resistance or the higher resistance at 1464.43 on 15-minute closes. Definitely let price be your guide, not what RSI might be showing or what the TRAN might be suggesting.

Remember that we've had some really weird settlement values for the SPX options over the last year. This is especially important in a climate in which we sometimes have big overnight moves up or down. The weird settlement values this last summer eclipsed last November's settlement value that was 14-15 points off the Thursday close. Especially if you're in credit spreads, take a look at your positions and assess whether you're comfortable with the overnight exposure.

Keene Little : 12/20/2007 3:04:39 PM

Definitely pull your stop down to a new afternoon high now. This should work like a charm from here otherwise I'll just step aside.

Jeff Bailey : 12/20/2007 3:04:14 PM

YM long stopped alert! ... 13,295

Jeff Bailey : 12/20/2007 3:00:13 PM

NYSE A/D 1,492/1,698

Jeff Bailey : 12/20/2007 2:59:53 PM

TRIN 0.97

Jeff Bailey : 12/20/2007 2:59:37 PM

YM Long alert! here at 13,307. Stop 13,295. Target 13,360.

Jeff Bailey : 12/20/2007 2:57:51 PM

YM ... 13,304

Jeff Bailey : 12/20/2007 2:52:14 PM

RIO with RIO-XZ Level II at this Link

If memory serves me correct, these traded $1.85 on Monday.

Keene Little : 12/20/2007 2:51:24 PM

Short against this morning's high but this should work from here so pulling your stop down to just above this afternoon's high now will reduce your risk some. I might try one more time if it stops me out with a new minor high if the negative divergences show me it could be the last high. But so far the setup was a pretty one and I like the short side.

Jane Fox : 12/20/2007 2:51:49 PM

This chart is not what you would call bullish but it is certainly not bearish. I was hoping 1460 would hold as support and when it did not it left me with no clear picture of who had control, the bulls or the bears. In my opinion, neither side does. Link

Jeff Bailey : 12/20/2007 2:48:48 PM

Swing trade covered put buy it back alert! ... Let's buy back the Companhia Vale Do Rio Doce RIO Dec. $32.50 Put (RIO-XZ) at the offer of $0.35.

RIO $32.69 +2.38% ...

Jane Fox : 12/20/2007 2:47:01 PM

Although "strong dollar" has been an oxymoron of late the dollar is looking strong. It is in need of a retracement but this pattern almost guarantees the retracement will be a higher low. Link

Jane Fox : 12/20/2007 2:44:18 PM

Crude still in its triangle. Link

Jane Fox : 12/20/2007 2:43:41 PM

Time to check out some daily charts now. Here is Gold and it is still in its triangle but not looking too good. Link

Jane Fox : 12/20/2007 2:41:01 PM

VIX making new daily lows tells me the markets will be making new daily highs here real soon. Well that is SPX and DOW 'cause NDX is way ahead of the pack and has been making new daily highs since 2:00.

Jeff Bailey : 12/20/2007 2:40:23 PM

RIO $32.78 +2.63% ... That bounce the past three day's in copper ... may be done.

Jeff Bailey : 12/20/2007 2:39:33 PM

January Copper (hg07f) $2.97 +0.67% ...

Keene Little : 12/20/2007 2:38:52 PM

SPX has tagged its downtrend line from yesterday morning. It might do a little throw-over finish.

Keene Little : 12/20/2007 2:37:50 PM

Almost there...

Jeff Bailey : 12/20/2007 2:37:27 PM

Tonight we get RIMM. We might use some of this tomorrow on the remaining QQQ-LY position.

Jeff Bailey : 12/20/2007 2:35:58 PM

If you're using NQ regular session high/low and close as you should be for your daily/weekly/monthly pivot levels, you're thinking ... "I've inflicted the pain" on the $50 call seller. Now my upside is to that WEEKLY 61.8% the rest of the day, but my RISK is some type of last hour decline back to NDX 2,050.

Also rememebering that 2.5 million share trade in the QQQQ from a couple of days ago.

Linda Piazza : 12/20/2007 2:34:32 PM

Typical opex Thursday stuff, isn't it? The SPX's next Keltner resistance is at 1459.90 and then again at 1464.37 on 15-minute closes. It doesn't look quite as strong as it did when tested yesterday morning and then again this morning, but RSI has approached 70, so it's possible that it will be time for a pullback right about the time the SPX hits that resistance and tests it. I just wouldn't count on anything on the short-term charts having primary importance on an opex Thursday. Other things are at work.

Jeff Bailey : 12/20/2007 2:33:27 PM

This is probably where an NQ bull has their finger on the button.

Jeff Bailey : 12/20/2007 2:29:38 PM

QQQQ and QQQLX as there's a taker at $0.88 (remember $0.90) Link

Keene Little : 12/20/2007 2:20:28 PM

AAPL update: I just got an alarm on AAPL with it rallying above the Dec 12th low of 185.77. That raises the possibility that it will get a bigger rally. The first potential resistance will be its downtrend line from Dec 11th, currently near 187.50 (or 188.25 if drawn through the high on the 17th). If AAPL makes it above its downtrend line then I think there's a good possibility we'll see it continue higher and therefore I'm lowering my stop on the short play to 188.50, down from 190.

Two equal legs up for its bounce off Tuesday's low is at 187.97 so the lowered stop keeps it above that level and the downtrend line. I'll now let the bulls prove to me that something more bullish is happening before I stop myself out.

Jeff Bailey : 12/20/2007 2:16:42 PM

QQQQ and QQQLX at $50.64 ... chart/Level II Link

Keene Little : 12/20/2007 2:07:20 PM

The risk in selling a breakdown is whipsaw so keep your stop relatively close (3 ES points max) in case it's a head fake break.

Keene Little : 12/20/2007 2:05:28 PM

With this 2nd leg up in the bounce off the lows near 12:45 PM it could fail at any time now. A drop back below the dip near 1:40 PM would indicate that we've probably seen the high. Therefore selling a break of that low would be another short entry.

Jeff Bailey : 12/20/2007 1:58:15 PM

A target for a day trade bull in the NQ is equivalent to QQQQ $50.86 should the QQQQ take out today's high.

Keene Little : 12/20/2007 1:56:37 PM

DOW 13245 and SPX 1459 are looking good from a Fib perspective for a high for this bounce. Look to short it if it stalls there, stop at a new daily high.

Jeff Bailey : 12/20/2007 1:55:13 PM

QQQQ and the Dec. $50 Calls ... 5-minute interval chart with Levell II Link

Keene Little : 12/20/2007 1:48:52 PM

If at any time price now drops below the low near 12:45 PM that would be an indication that the triangle pattern has finished and time to get short. In the meantime I'm waiting to see if we get another leg up in this bounce.

Jeff Bailey : 12/20/2007 1:45:15 PM

This is where things get interesting toward the close.

Here's a screen capture of QQQQ and some Level II Link

Institutional traders LOVE to sell premium on gaps to capture the jump in implied volatility. If it starts to get away from the NAKED seller (say Dec. $50 Call), they may have to push the underlying higher to get hedged near-term.

RIMM reports after the close.

Jane Fox : 12/20/2007 1:42:59 PM

Ad line has been all over the map today. it started out at with at high of +1149 and then fell to a low of -1067. Link

Linda Piazza : 12/20/2007 1:39:56 PM

In reference to my 12:11:16 post, a subscriber makes the following valid points: 1) long-term charts are better viewed on a semi-log chart than an arithmetic one; and 2) that fund I charted gave a $4.78 dividend on 12/14, so my simple chart isn't taking that into account.

My answer: 1) true, and 2) true. I much prefer a semi-log chart than an arithmetic one when I'm charting a long-term move. The differences are astounding, and my first primer on technical analysis, TECHNICAL ANALYSIS EXPLAINED, a heavy tome by Pring, advised using semi-log charts for long-term moves. Unfortunately, I have not found a way to convert my charts to semi-log on my current charting provider. You Q-Charts people can do so easily, however, and I advise that you do it.

I realize that many of the funds I was charting offered dividends recently. I realize that there are often redemptions this time of year for various reasons. I realize that complicates reading the charts. While it's only anecdotal evidence anyway when I'm looking at a small number of charts, I was doing something that I didn't show on the annotations on that chart: I was going back years and studying the "typical" patterns in December. I was also testing something that the author had said. He'd said that the funds that he'd shown had been ranked in the top 25% in Morningstar as to their performance in a bear market. So, what I also didn't discuss in that post (I'm so long-winded anyway that I can't discuss everything) is that I'd also gone back and looked at each of them during the 1999-2004 period. I haven't finished my studying and deciding yet. That wasn't my point, to say "don't buy this fund." My point was to say "don't log into your broker's page and buy a fund or anything else just because someone else recommended it." Test the things you've been told for yourself. I actually expected to see a pattern of redemptions this time of year, and had thought they might bring those recommended (by the author) funds down to attractive levels, but when I looked at the pattern across several years, I just wasn't sure that the levels reached were ones at which I wanted to buy. Whether or not a dividend was offered, support was broken on that particular chart, and next support was lower on that particular fund and on several others. I look at charts of stocks all the time that offer dividends, and they don't always break support when they go ex-dividend. In my opinion, at least, it still means something when they do, but that's just my opinion.

So what did I conclude so far? So far, I concluded a lot of people are uncertain about prospects or in need of cash. If there's a lot of uncertainty out there, I want to be particularly careful about my decisions.

But I'm proud to say that our readers have impressed me again. This subscriber didn't trust me, either, and did his own research. That's exactly as it should be. Smart guy.

Keene Little : 12/20/2007 1:39:21 PM

The dark red wave count on the SPX 60-min chart still looks like a good setup for a short down to 1420. A rally above this morning's high would have me thinking we might rally further--up to a Fib projection near 1474. Link

Today's high will make a good stop for a short entry on the current bounce (hoping to see a pullback and then another leg up to give us a clean a-b-c move up from the low at 12:45 PM). It's possible we'll see the day finish near the high and then start tomorrow with a gap down. Finishing near the high by the end of the day is speculation at this point based on some Fib price and time relationships between the waves.

Keene Little : 12/20/2007 1:27:51 PM

This little bounce looks like it caught some bears asleep at their keyboards. I'm hoping we'll see the DOW and SPX make it up to their downtrend lines from yesterday morning's highs (NDX could make a new daily high--watch 2057.79, COMP 2638.38). SPX 1456-1459 and DOW 13240-13275 are the zones that I'll be watching for the short play to set up.

Jeff Bailey : 12/20/2007 1:24:06 PM

What they gonn'a do ... QQQQ $50.53 +1.30%

Jeff Bailey : 12/20/2007 1:23:38 PM

TRINQ at session low 0.49 ...

Jeff Bailey : 12/20/2007 1:22:38 PM

TRIN 1.00 ... DAILY Pivot at 0.97.

Jeff Bailey : 12/20/2007 1:20:12 PM

My assessment ... be VERY alert in today's last hour of trade.

Linda Piazza : 12/20/2007 12:58:32 PM

Let's assess: the advdec line continues lower; the VIX continues higher; the TRAN is trying to rise, but within the context of lower highs and lows (so still more short-term bearish than bullish); and the USDJPY still moves lower, although within the context of a congestion zone (so still more neutral than bearish). Two are bearish; two are mixed. Add in the fact that this is an opex Thursday, and you add in a little more uncertainty. So, the weight of evidence still goes toward an interpretation of underlying weakness, at least in my opinion, but the fact that this is opex Thursday complicates the interpretation. The SPX is still being pressured toward yesterday's low of 1445.51 and next Keltner support at 1442.86 on 15-minute closes, but it's a frustrating wait for anyone wanting to see how the SPX would act on such a test, if either of those levels is reached. So, for now, don't be overconfident of follow-through to the downside.

Jeff Bailey : 12/20/2007 12:57:21 PM

In Monday's Market Wrap I went through the NY Empire Index, which was a bit of a preview to today's Philly Fed, which is a preview of the ISM.

Keene Little : 12/20/2007 12:50:58 PM

So far there's bullish divergence with the internals at this marginal new low. I'm probably micromanaging this which is often not what you want to be doing on an opex Thursday. I'm currently flat and waiting for my setup and if it sells off instead it just means I missed my bus. I don't trust the downside yet.

Jeff Bailey : 12/20/2007 12:50:39 PM

I had several email questions regarding "why?" various Proshares were registering prices they were today.

Keene Little : 12/20/2007 12:46:04 PM

Hmm, SPX had marginally broken its uptrend line from Tuesday, bounced back up to the line, gave it a little peck on the cheek and is now dropping back down. That's not bullish.

Jeff Bailey : 12/20/2007 12:45:38 PM

Proshares Q4 Distribution Schedule Link

Linda Piazza : 12/20/2007 12:36:23 PM

The USDJPY is at 112.86 as I type, still inside that congestion zone, but trending down since yesterday morning and nearing a test of 112.60-112.80 support.

Keene Little : 12/20/2007 12:30:34 PM

I was beginning to wonder about whether the bounce would happen. SPX got down to 1447.83, missing its downside projection at 1447.73 by 10 cents. Tch, tch. Now I'm hoping we'll see a corrective bounce back up, potentially up near this morning's high, to set up the short play for the next leg down (SPX 1420 target). If we only get a little bounce and then a turn back down to new lows then things could turn more bearish sooner.

Linda Piazza : 12/20/2007 12:25:04 PM

The TRAN so far maintains its breakdown status on the 15-minute Keltner chart. It's not falling far, though. Just know that so far, it continues its pattern of lower highs and lower lows off last Tuesday's high.

Jeff Bailey : 12/20/2007 12:11:42 PM

NASDAQ A/D 1100/1755

TRINQ 0.56

NH/NL 52:165

Linda Piazza : 12/20/2007 12:11:16 PM

Always do your own research. Take no one's word for anything, including mine. Our site's attraction for me when I was a subscriber was never some post telling me to enter a trade now, but rather the education I got by reading the posts and articles.

Here's a case in point. I recently found an article--perhaps on MSN, although I'm not certain--on core funds one should hold. Supposedly these funds were those that the author felt were diversified, run by proven managers, and somewhat protected on the downside. Many, maybe the majority of those listed, had five stars under Morningstar.

The article heightened my curiosity. I decided to run a few charts. Whoa! It doesn't look as if some investors agree that these would be good to hold in a downturn or that they'll perform well. Although many of these funds show tall red candles this time of year, as is natural, they're especially tall this year! Here's an example: Link

Jeff Bailey : 12/20/2007 12:04:53 PM

Philly Fed Dec. Business Index -5.7 Vs. Nov. 8.2
Prices Paid 35 Vs. Nov 37.7
Prices Received 16.7 Vs. Nov 18.6
New Orders 10.7 Vs. Nov. 3.5

Jeff Bailey : 12/20/2007 12:02:37 PM

EIA Weekly Nat. Gas Storage Table at this Link ... Draw of 121 Bcf

Jeff Bailey : 12/20/2007 12:00:34 PM

Archer Daniels Midland (ADM) $42.57 +2.87% ... that's a new 52-weeker.

Jeff Bailey : 12/20/2007 11:59:42 AM

CONAGRA FOODS 2Q NET RISES 15%

DJ- Net income rises to $244.8 million, or 50c a share, as hedges offset costs of soaring food and energy prices. Revenue grows 14% to $3.51 billion. ConAgra raises 2008 EPS view to $1.55, from previous forecast of $1.48.

CAG $24.29 -2.01% ...

Jeff Bailey : 12/20/2007 11:58:28 AM

LEAR RAISES 2007 EARNINGS OUTLOOK

DJ- Lear increases 2007 core operating earnings expectations to $750 million from previous outlook of $680 million due to stronger production schedule, continuing strong operating performance and benefits from restructuring actions.

LEA $28.00 +1.15% ...

Jeff Bailey : 12/20/2007 11:57:19 AM

DJ Home Construction (DJUSHB) 313.29 -2.11% ... retraces 50% of its recent 11/27 to 12/11 bounce.

Jeff Bailey : 12/20/2007 11:55:20 AM

WEEKLY BUSINESS BAROMETER FLAT

DJ- Dow Jones-Bank of Tokyo-Mitsubishi-UFJ weekly business barometer remains steady in the week ending Dec. 8, after rising 0.3% the prior week. On a weekly year-over-year basis, the barometer is down 0.8%.

Jeff Bailey : 12/20/2007 11:54:43 AM

NAVISTAR TO BUY GM TRUCK UNIT

DJ- General Motors enters into a non-binding agreement to sell its medium-duty truck business to Navistar International. Deal is set to close next year, though financial terms were not disclosed.

GM $26.35 -1.12% ...

Jeff Bailey : 12/20/2007 11:53:09 AM

DISCOVER SWINGS TO 4Q LOSS ON CHARGE

DJ- Credit-card firm posts a net loss of $84.1 million, or 18c a share, compared with year-earlier net income of $186.5 million. Results include a 58c a share charge. Analysts expected EPS of 36c.

DFS $15.50 -2.45% ...

Keene Little : 12/20/2007 11:52:25 AM

SPX is getting close to the level where it would have two equal legs down from this morning's high--1447.73.

Jeff Bailey : 12/20/2007 11:51:22 AM

CARNIVAL 4Q NET FALLS 14%

DJ- Cruise operator reports net income of $358 million, or 44c a share, amid increased fuel prices and sees 1Q earnings below expectations. Revenue rises 11% to $3.12 billion.

CCL $43.62 -1.37% ...

Jeff Bailey : 12/20/2007 11:50:11 AM

QUALCOMM BOOSTS OUTLOOK ON HIGHER DEMAND

DJ- Wireless tech firm expects revenue to come in at the high end of its prior range of $2.3 billion to $2.4 billion. Earnings are expected at 52c to 53c a share on a pro forma basis, compared with previous range of 50c to 52c.

QCOM $38.71 +1.12% ...

Jeff Bailey : 12/20/2007 11:49:12 AM

MONEY-MARKET MUTUAL FUND ASSETS SHED $28.39B

DJ- Investors to money-market funds withdraw $28.39 billion in the week ended Tuesday, bringing total net assets to $3.087 trillion. Institutional investors withdraw $31.52 billion, while retail investors contribute $5.62 billion.

Jeff Bailey : 12/20/2007 11:48:14 AM

SUNTRUST TO TAKE ON $1.4B OF SIVS' HOLDINGS

DJ- Bank discloses plans to buy $1.4 billion in securities held by two of its structured investment vehicles to prevent investor losses in 'this unique environment.' Firm also completes review of its Coca-Cola stake.

STI $61.07 -3.81% ...

Jeff Bailey : 12/20/2007 11:46:54 AM

Walgreen (WAG) $36.08 -0.82% ...

Jeff Bailey : 12/20/2007 11:46:27 AM

RITE AID SHARES SLIDE AFTER 3Q LOSS

DJ- Rite Aid shares plunge 24% after the drugstore chain posts a 3Q loss of $84.8 million, or 12c a share, and again lowers its outlook for 2008, citing acquisition costs, a weak cold and flu season and soft holiday sales.

RAD $3.13 -23.65% ...

Jeff Bailey : 12/20/2007 11:45:17 AM

Dow Transports (TRAN) 4,530 -1.17% ...

Jeff Bailey : 12/20/2007 11:44:46 AM

United Parcel Service (UPS) $71.11 -0.26% ...

Jeff Bailey : 12/20/2007 11:44:19 AM

FEDEX 2Q NET FALLS 6% ON FUEL COSTS

DJ- Shipping firm posts earnings of $479 million, or $1.54 a share, due to the rising cost of fuel. Analysts expected EPS of $1.50. For the 3Q, firm anticipates earnings of $1.15 to $1.30 a share; Wall Street expects $1.37.

FDX $93.47 -1.22% ...

Linda Piazza : 12/20/2007 11:44:16 AM

I'm back to see the SPX drifting slowly downward toward the trough between yesterday's high and today's. That trough is at 1445.31, with the SPX at 1450.68 as I type. If the SPX should continue drifting down, there's light Keltner support at 1449.11 on 15-minute closes and then at 1442.69 on 15-minute closes. There's of course presumed historical support at that trough level at 1445.31.

Will the SPX continue drifting down? The Keltner setup is such that support looks slightly weaker than resistance, so it's a possibility, but this is opex Thursday and nothing is too reliable, especially when not all ducks are in a row.

The TRAN continues lower. That suggests a bearish outcome more than a bullish one.

As I type, the USDJPY has drifted down and is now at 112.89. The Keltner setup is such that a sustained breakdown below 112.57 would set up a breakdown mode. We already know that there's historical and Fib support in the 112.60-112.80 zone, too, so until and unless that support is broken, it's just moving around within congestion. However, the trend since about 11:00 yesterday has been down, so you see how you could pick out something, depending on your bias, and hold it up as proof that something or other is going to happen?

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

Monster Worldwide (MNST) $32.50 +0.86% ...

Jeff Bailey : 12/20/2007 11:42:46 AM

Manpower (MAN) $55.68 -1.53% ...

Jeff Bailey : 12/20/2007 11:42:21 AM

US JOBLESS CLAIMS GAIN MORE THAN EXPECTED

DJ- Initial claims for jobless benefits increase by 12,000 to 346,000 in the week ended Dec. 15. Analysts expected a gain of only 2,000. Four-week average rebounds to its highest level in over two years and suggests soft labor market.

Jeff Bailey : 12/20/2007 11:41:48 AM

US LEADING INDICATORS INDEX DOWN 0.4%

DJ- The Conference Board's composite index of leading indicators falls 0.4% to 136.3 in November after a 0.5% decline in October. Economists expected a decline of 0.3%.

Jeff Bailey : 12/20/2007 11:41:12 AM

US 3Q GDP UNREVISED AT 4.9%

DJ- Gross domestic product rose at an unrevised 4.9% annual rate July through September, marking the fastest quarterly pace since 7.5% in the 3Q of 2003. Economists expected a 5.0% increase.

Jeff Bailey : 12/20/2007 11:40:36 AM

ORACLE GAINS AFTER 2Q PROFIT JUMPS 35%

DJ- Shares jump 7% after business-software maker reports its earnings rose to $1.3 billion, or 25c a share. Excluding special items, earnings are 31c a share; analysts expected 27c a share.

ORCL $22.16 +6.74% ...

Keene Little : 12/20/2007 11:40:12 AM

The reason I think the uptrend line from Tuesday is important for this morning is because it could be the bottom of the sideways triangle pattern that appears to be playing out, at least for the DOW, since Tuesday's low. The top of the pattern is close to this morning's high and therefore that's the potential for another bounce before this is ready to sell off again. It takes a break below Tuesday's 13092 low to confirm that the next leg down is in progress. The bulls still need a break above 13325 to indicate something more bullish is happening. Link

Jeff Bailey : 12/20/2007 11:39:32 AM

MBIA SHARES DROP ON SUBPRIME CONCERNS

DJ- Shares plunge 24% as confidence in top bond insurer MBIA plummets after the guarantor discloses on its website that it had $8.1 billion in exposure to complex and risky securities backed by home loans.

MBI $20.51 -24.13% ...

Jeff Bailey : 12/20/2007 11:38:33 AM

BEAR STEARNS POSTS FIRST-EVER LOSS, WRITES DOWN $1.9B

DJ- The smallest of Wall Street's five big investment banks records a net loss of $854 million, or $6.90 a share, in its 4Q compared with net income a year earlier of $563 million. Revenue, wounded by the write-downs, slips into negative territory. Members of firm's executive committee will not receive any bonuses for 2007.

BSC $89.32 -1.41% ...

Jeff Bailey : 12/20/2007 11:35:40 AM

US To Sell $39.0 Billion T-Bills Monday (Vs $41.0 Billion)
Auction To Raise $9.0 Billion New Cash

Jeff Bailey : 12/20/2007 11:34:04 AM

DJ Survey- US Nov. Personal Income Seen +0.5%

Keene Little : 12/20/2007 11:29:15 AM

SPX is testing its uptrend line now at 1450. The DOW is very close to its uptrend line. We'll see if the bulls can hold on here for another bounce (which should set up a good shorting opportunity if it does).

Jeff Bailey : 12/20/2007 11:23:51 AM

Kellogg (K) $52.83 -0.30% ...

Jeff Bailey : 12/20/2007 11:23:16 AM

EU Suspends Import Duties On Most Cereals

Keene Little : 12/20/2007 11:09:47 AM

Need to step away for about 15. Watch those uptrend lines for a bounce (or not).

Keene Little : 12/20/2007 11:03:53 AM

The uptrend lines from Tuesday are near DOW 13177 and SPX 1449.40 so those might be better support levels to watch for a bigger bounce back up.

Keene Little : 12/20/2007 11:02:00 AM

In case we're still consolidating inside a sideways trading range (for the DOW and SPX more than the others which had more of an a-b-c bounce), watch for two equal legs down from this morning's high to set up another bounce to a lower low. In other words, be careful of more whipsaws today before this lets go to the downside. So potential support might be found near DOW 13149 and SPX 1447.73.

Keene Little : 12/20/2007 10:57:15 AM

The bounce is getting sold hard. Not very bullish.

Linda Piazza : 12/20/2007 10:50:31 AM

Nothing much has changed since my last post. The TRAN dipped lower but is trying to bounce again. If it can't sustain values above about 4553 on 15-minute closes, it's established a breakdown mode on the 15-minute chart. Yet, if the TRAN appears to be tugging the SPX and some other indices down, the USDJPY continues to hang up there in the congestion zone it's been building near the recent swing high. If the old inter-market relationships still exist, that remains supportive of prices. And the SPX just moves sideways, tugged in opposite directions and under the influence of an opex Thursday action.

I'm stepping away for a few minutes.

Keene Little : 12/20/2007 10:47:20 AM

A new high for the techs could also have NDX tagging 2057.79 for two equal legs up from Tuesday.

Keene Little : 12/20/2007 10:44:03 AM

The techs are holding up reasonably well. If they can push to a new high watch for gap closure at 2636.88 for the COMP. That would look good for the completion of an a-b-c bounce off Tuesday's low as well and could make for a very nice setup for a short play.

Jeff Bailey : 12/20/2007 10:35:33 AM

SPY $146.01 +0.08% ...

Jeff Bailey : 12/20/2007 10:35:10 AM

BIX.X 269.99 -1.64% ....

Jeff Bailey : 12/20/2007 10:33:23 AM

Wachovia (WB) $38.17 -2.10% ... probes its MONTHLY S1. (see yesterday's MM chart).

WB-PH $4.80 x $5.00.

VIX.X 21.31 -1.70%

Keene Little : 12/20/2007 10:23:04 AM

Keep an eye on the uptrend lines from Tuesday as they're important. I would expect a bounce off them and then I'll be looking for a short play to set up. Or wait for the break of the lines and hopefully a retest to short it. Until those lines break just keep in mind that we're still in a short term up trend.

Keene Little : 12/20/2007 10:14:37 AM

We've now got an impulsive decline from this morning's high. That should indicate the high is already in. Look for a bounce to short for another leg down.

Jane Fox : 12/20/2007 10:13:50 AM

VIX continues to make new daily highs supporting the S&P futures new daily lows.

Linda Piazza : 12/20/2007 10:11:44 AM

Earlier, Jane mentioned the mixed picture she's been getting for days from the indicators that she watches. I'm experiencing the same thing when watching the TRAN versus the USDJPY. Both usually go the same direction as the SPX, OEX or Dow. At least, in the case of the TRAN, the SPX, OEX and Dow don't tend to go too far in the opposite direction of the TRAN, even if they do for a short time. Divergences can be important.

Lately, though, the USDJPY has been showing strength--consolidating near the recent push higher--while the TRAN has been showing weakness. When I see such inconsistencies, I'm alerted that something isn't right, but I haven't been given the gift of prophecy, so I can't tell you which should be discounted and which should be believed. I'm tending to discount the USDJPY a little since it's been subject to a lot of winds in the wake of the FOMC's decision last week and the BOJ decision last night, but I'm not discounting it entirely.

Keene Little : 12/20/2007 10:09:26 AM

ES was 3 points shy of closing Monday's gap down and the COMP came within 8 points of closing its gap. It would have been nice if this morning's rally had closed those since it continues to be a magnet for now. It takes a break below yesterday afternoon's lows to break that magnetic pull.

Linda Piazza : 12/20/2007 10:07:19 AM

TRAN to a new day's low, also below yesterday's low. There's no bullish price/RSI divergence yet on the 15-minute chart, but a potential Keltner support level is being tested. If the TRAN breaks through this and sustains values below about 4553, it's now in breakdown mode, and that's definitely not corroborative of SPX, OEX and Dow gains. If it bounces strongly from here, it at least won't be arguing as strongly against the sustainability of this morning's first rally.

Turning to the SPX, I see that the Keltner resistance did hold again today. It looked strong as I mentioned, but the formation on the chart was actually leaning toward the bullish side, if roughly formed. A drop below 1452.30 or so will invalidate that formation. The SPX is at 1455.24 as I type.

Remember that this is expiration Thursday, and it's the last day for DEC SPX options to trade. We sometimes get a pin-them-to-the-numbers reaction set in about mid-morning on an opex Thursday. When that happens, technical analysis just isn't as helpful. Potential setups never see follow through. Keep that in mind before you initiate a trade, especially when considering how much you'll risk on any trade.

Linda Piazza : 12/20/2007 9:56:05 AM

Once again, the TRAN just isn't looking strong, currently sinking toward yesterday's 4558.58 low. It's at 4564.13 as I type. Unless it bounces, this isn't supportive or corroborative of the SPX's gains. The TRAN isn't always a precise indicator, particularly when trying to time movements, but it can be a heads-up that something isn't quite right. So, SPX, OEX and DOW bulls want to see it bounce soon, and bounce hard, while equity bears want to see it go ahead and drop heavily through yesterday's low.

Keene Little : 12/20/2007 9:55:48 AM

If the market continues to drop back down then it will have been just another spike of the ball after the bulls laid it up. Needless to say that would start to get downright depressing for the bulls waiting for Santa to arrive.

Linda Piazza : 12/20/2007 9:53:06 AM

The SPX is now testing the same Keltner resistance that it tested yesterday morning at about 9:45. Keltner lines are dynamic, so that resistance is now layered up to 1464.92 on 15-minute closes. The resistance still looks relatively strong, but one could look at that formation for the last two days and say it's a roughly formed cup-and-handle formation, which is a potentially bullish formation. We're going to have to wait and see what happens. So, watch for a potential stalling or rollover from about 1462-1465. A sustained breakout above that zone would be more bullish, but until that happens, if it does, I don't think we can draw many conclusions.

Keene Little : 12/20/2007 9:51:05 AM

Let's see if the bulls can get one more push higher now. That could set up a "top o' the morning" for you.

Jane Fox : 12/20/2007 9:50:57 AM

I see a YM long at 13366 but the stop will be under 13313 and that is just too much for me so I will pass on the trade and wait for the next train to come along.

Jane Fox : 12/20/2007 9:42:36 AM

But the VIX is making new daily highs so it does not support the bullish AD line. This has been the scenario for days now, the AD line is either bullish or bearish but the VIX does not support it.

Jeff Bailey : 12/20/2007 9:41:13 AM

Swing trade call(s) exit alert ... should be filled, close out of four (4) of the QQQQ Dec. $51 Calls (QQQ-LY) at $0.25/contract.

Jane Fox : 12/20/2007 9:40:48 AM

AD line is +1138.

Jane Fox : 12/20/2007 9:37:05 AM

The SPX has some major resistance ahead of it. Like I said yesterday 1490 has lost its importance as support/resistance but I suspect it will still be hard to break. Then we have 1520 which will no doubt be resistance, if SPX even gets back up to that level. Link

Linda Piazza : 12/20/2007 9:31:17 AM

Japan kept rates steady, as expected, last night. Once the announcement was made, the USDJPY continued the generally downward short-term trend that it had begun about 11:00 yesterday morning, but it's trending lower within a congestion zone that it's been building for days. It's again offering no clues. Bulls (equity and U.S. dollar) will note that it's been consolidating just under recent highs, but I'm one of those who says we have to see which way the congestion breaks before we draw any conclusions.

Keene Little : 12/20/2007 9:29:36 AM

Looking at NQ, being the most bullish this morning, two equal legs up from Tuesday's low is at 2082.25 so that's a level of interest if it gets tagged and price stalls there (it could complete an a-b-c bounce there). For NDX that would be at 2057.79, about 27 points above yesterday's close (NQ is currently up 21).

Keene Little : 12/20/2007 9:23:22 AM

Something sure has the bulls all fired up this morning. I don't think it's the morning reports since the big push up started before that. More manipulation pre-market? I distrust moves like this before the open since it has me thinking someone with the ability to move the futures like this is looking for a gap up to sell into. Be careful.

I don't like to use all-hours trading for my analysis because of the light volume and lack of full participation during the overnight session. But the choppy rise in ES, with the look of a rising wedge, since Tuesday's low has me wondering if it might be giving us a heads up for a potential high around 1480 (1478 would close Monday's gap down): Link

If the pattern is correct then a quick retracement of the pattern (back to Tuesday's low) would be a typical move. Something to watch for this morning if it pushes higher.

Jane Fox : 12/20/2007 9:22:40 AM

WE have not taken a look at the DAX for a while now, the German counterpart to the DOW and a market that mirrors the DOW although sometimes it leads the DOW and sometimes it follows. What I find interesting on this chart is that it has retraced only 50% from its December high whereas the DOW as retraced 61.80% Link Link

Jane Fox : 12/20/2007 9:17:44 AM

US$ is building a very nice bullish channel and may be in a perfect spot to take a breather but as long as that lower trendline of the channel is not broken I will remain bullish the greenback and not take any Gold positions. Link

Jane Fox : 12/20/2007 9:13:36 AM

Gold is still hovering within in the triangle I identified yesterday. I still think it will break out the bottom because of the strength in the US$ but has not yet broken out because Crude is still within its triangle as well. Link Link

Jane Fox : 12/20/2007 9:07:58 AM

Markets are now breaking their overnight highs and ES is testing its PDH. YM is not quite there yet.

Jane Fox : 12/20/2007 9:07:25 AM

Not surprisingly, the bulls have ruled the overnight session. The 8:30 GDP report was just what they needed. Notice that the overnight patterns are very similar but both the DOW (YM) and the S&P (ES) futures did not break their respective previous day highs. This was, of course, due to the fact that they both closed mid range whereas the Russell 2000 (ER2) and NDX (NQ) futures closed at the top of their PDR. Link

Jane Fox : 12/20/2007 8:59:26 AM

When you read the comment about Bear Stearns executives will not get a bonus this year I could hear the collective, "Ah Gee."

Jane Fox : 12/20/2007 8:58:15 AM

BOSTON (MarketWatch) -- Bear Stearns Cos. posted its first-ever quarterly loss on Thursday as the company's mortgage-related write-down grew to $1.9 billion after credit markets worsened last month.

The broker reported a fourth-quarter loss of $854 million, or $6.90 a share, compared with net income of $563 million, or $4 a share, a year ago.

Confirming press reports earlier this week, Bear Stearns said members of the executive committee will not receive any bonuses for 2007.

"We are obviously upset with our 2007 results, particularly in light of the fact that weakness in fixed income more than offset strong and, in some areas, record-setting performance in other businesses," said James Cayne, chairman and chief executive officer, in a statement.

Jane Fox : 12/20/2007 8:57:15 AM

WASHINGTON (MarketWatch) -- Seasonally adjusted initial jobless claims rose 12,000 to 346,000 in the week ended Dec. 15, the government reported Thursday.

Wall Street analysts were looking for initial claims of 335,000. Economists watch claims closely because an increase could be a leading indicator of a slowdown.

Some observers have been concerned about an upward trend in claims. Initial claims were at 319,000 during the same period a year ago.

This week's figures are particularly closely watched, because they correspond to the week the government canvasses business establishments and households for the monthly employment report, due out Jan. 4.

Jane Fox : 12/20/2007 8:56:27 AM

WASHINGTON (MarketWatch) - In one last fond look back, the government said Thursday that the U.S. economy grew at a 4.9% annual pace in the third quarter, the fastest growth in four years.

The 4.9% "final" estimate was unrevised from the previous estimate.

With forecasts now looking for the economy to slow to 1% growth or less in the fourth quarter, the rapid growth last quarter was something of a last hurrah, based on a burst of inventory building and strong export growth that can't be maintained.

Looking forward, economists expect slower growth in consumer spending, business investment, exports and inventory building. And they expect little or no improvement in a housing market that was the worst in 16 years during the third quarter.

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