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Jeff Bailey : 1/30/2008 12:46:59 AM

YM is down 37 at 12,434. See you in the morning.

Keene Little : 1/30/2008 12:44:18 AM

Wednesday's pivot tables: Link and Link

The DOW provides a good example for how the next day or two could provide some clues as to what the stock market might do over the next month or so. Starting with the 60-min chart I show two possibilities for tomorrow--up or down (am I good or what? of course the other possibility is that the market will go flat and we won't know more until after FOMC): Link

I see resistance just overhead in the 12500-12550 area so if the DOW can rally above that level (key level is at 12540) then there's a good possibility we'll see it rally up to the top of a larger down-channel near 12800. This is also where the move up from last week's low would have two equal legs up at 12802 (and labeled a-b-c in pink). It's not depicted but the pink wave count could first see a pull back on Wednesday to correct the rally off Monday's low before rallying back up again.

It's already a long ways down but if the DOW breaks below Monday's low near 12115 then the pink wave count gets negated and we'd be into the dark red count, hence the key level at 12115. In that case I see a drop down to the 11800 area in early February before another bounce.

The pink wave count would take us higher into late February in a larger A-B-C move up as shown on the daily chart: Link . The key level to the upside on the daily chart is 12724 which is the wave (1) low on Nov 26th. The dark red wave count calls for a 4th wave sideways triangle correction so it can't overlap wave (1) otherwise that count gets negated.

The larger A-B-C bounce in pink could take the DOW up to around 13200-13300 and the downtrend line from October-December. From there it would then start its next big decline into April (potentially faster). The dark red sideways triangle would likely play out into the end of February before continuing lower, also into April.

Both scenarios would have downside Fib projections near each other in the 10600-10700 area. What's different is the path each would take to get there. The key levels on the 60-min and daily charts will tell us which scenario is likely playing out so let price lead the way and tell us which road we're following.

Jeff Bailey : 1/30/2008 12:35:42 AM

ABK's recent low was 1/17/08.

MBI's was 1/18/08

MTG's was 1/17/08 and another quick one 1/23/08 with a strong "reversal" bar.

OK ... so Fed comes in on 1/22/08, SPY/SPX and other major indexes make their current "inflection" low.

But the mortgage brokers, they made their "lows" a few days before.

Maybe somebody knew something BEFORE 1/22/08 AM?

I'll stick some al_rts under the 1/22 session lows of the mortgage insurers.

I really do think Fed policy is targeting the credit crunch MORE than it is ANYTHING it (the Fed) sees as major economic trouble. I think Bernanke speaks the truth.

If I were the Fed, what would I do after the 1/22 75 bp cut?

I've got 3.5 bp left.

I can't see more than 50 bp. Looking at the mortgage insurers and recent bounce, they still look like they need at least 25 bp. Another shot in the arm?

If that "loophole" gets closed, the bond insurers will only be able to go back to the low-margin business.

Jeff Bailey : 1/30/2008 12:18:49 AM

It's 1/22/08. Check the "lows" for the mortgage insurers.

Jeff Bailey : 1/30/2008 12:17:42 AM

Wait, wait, wait ... what day is our current "anchor low" for the SPY?

Jeff Bailey : 1/30/2008 12:08:54 AM

Terminology: What a credit default swap portends to do is this. The buyer of a CDS receives credit protection, while the seller of the CDS guarantees the credit worthiness of the product. When the exchange takes place, the RISK of default is transferred from the holder of the fixed income security to the seller of the swap.

An options trader can understand this. The buyer of the "derivative" (options are simply a derivative of the underlying security) is entitled to the par value of the bond by the seller of the swap, should the bond default in its coupon payments.

Jeff Bailey : 1/29/2008 11:58:00 PM

Interesting article ... Bond insurer woes may mean end of loophole Link

Jeff Bailey : 1/29/2008 11:54:46 PM

When I look at the three (3) mortgage insurer-related stock (MBI, ABK, MTG) in our Watch List, the YrNet% not overly revealing. Maybe the MARKET sees ABK a greater risk (-85.18%) than MBI (profile 1 put) and MTG.

When I look at the 20-day Net% then ABK really may stand out (-32.83%) as a stock the MARKET sees having greater risk near-term.

Jeff Bailey : 1/29/2008 11:46:13 PM

Some meetings I've attended with clients and banking industry executives have the 11:17:01 a priority.

Depending on the "findings" we can see who may get stuck with all of this.

Let's say there was a "rogue mortgage broker" out there that was doing all he/she could do to generate new mortgages, refinances to anyone that didn't know how to read the fine print. Even though the legal document said "rate may change based on Libor" the broker assured the client that it didn't really impact them. Don't pay any attention to the 130% loan value either!

So, this goes on and on.

The mortgage lender bundles up 100 mortgages, and sells them to a large bank, or institution for $30 million.

Then large bank, or institution sits and collects 3% on that basket. Then one week, only 90% of those loans are paid on time. Hmmm...

Who really has the RISK?

It is either going to be the mortgage insurer, you know, the its the Principal + Interest + Taxes + Insurance on the loan. It is usually the guy/gal at the END of the line that gets stuck with all the garbage.

The FBI probe isn't going to focus on the insurers. They're looking for blood/fines/jail time at the original point of contact (mortgage originator) down to the last BIG BANK, or financial institution that KNOWINGLY sold the loan that couldn't be paid to the next dealer that thought they had a bargain.

You've seen some of my "news" postings over the past several weeks that some BANKS aren't willing to belly up for the special reserve fund for subprime.

You can't really blame some of them. Why should THEY pay into something they either are not a part of, or that they were hedged against?

Jeff Bailey : 1/29/2008 11:17:01 PM

FBI Probes 14 Companies Over Home Loans ... AP Story Link (see Tuesday's MM)

Jeff Bailey : 1/29/2008 11:12:28 PM

INDU/DIA/YM components at this Link

UNLIKE the QQQQ, or SPY/SPX, or OEX, or RUT.X, the INDU/DIA/YM is a PRICE weighted Index. HIGHEST price stock(s) have more WEIGHT than the smaller priced.

I'd think a trader wide to place DIA in a retracement. Then match up your "top 10" IBM-KO to.

Jeff Bailey : 1/29/2008 11:03:38 PM

The "dynamics" of what drives a stock, or index isn't all that complicated, but it does take a little bit of thought.

For instance, we see volume in the QQQQ on a minute-by-minute basis. What we know is that the QQQQ isn't anything by itself. It is a BASKET of 100 stocks. It is NOT an equally weighted basket. What the QQQQ allows market participants to do is get EXPOSURE (long, or short) to this particular BASKET of stocks.

Once that is understood, we can then understand how a BULLISH, or BEARISH market bias toward the QQQQ can have INFLUENCE on the 100 components.

For example, say we SHORT $10,000,000.00 worth of QQQQ. What this is really is a "short me a weighted basket of the QQQQ components."

Do you see the INFLUENCE of such a trade? It isn't a "pick and chose" what security is being shorted.(ie. AAPL, MSFT, QCOM, GOOG, CSCO), but a $10M short on the QQQQ would have a greater % being place on AAPL, then MSFT, then QCOM, then GOOG, then CSCO.

Now what about AAPL, the most HEAVILY weighted component. What about the $10,000,000.00 BUY LONG trade. "Pick up a partial with $10,000,000.00 at a cost basis of no more than $133.00.

Over time, these transactions (buying, selling) have impact on the NDX/QQQQ/NQ too. MUCH greater IMPACT on APPL as it is SPECIFIC to APPL, but you begin to understand the eventual IMPLICATIONS for the QQQQ/NDX/QLD, or even the nq08h.

Now think of RANGES.

We market a RANGE on the QQQQ/QLD/NQ (conventional use of Fib, maybe Pivot Levels too).

And this is where OBSERVATIONS of SPECIFIC and MOST HEAVILY WEIGHTED stocks comes into play. It also SPEAKS GREAT VOLUMES TO RELATIVE STRENGTH!

We can begin to comprehend from OBSERVATIONS what should happen to the QQQQ should we start counting more DOWNSIDE alerts, or UPSIDE alerts.

With AAPL $131.54, and its 0% retracement at $126.14, what might we begin to think, or OBSERVE if that "al_rt" goes off? Yes! We start to think ... "hey, the BIG gun is 1st to show further softening."

Now, begin to understand why AAPL traded new all-time highs in late December, as QQQQ wasn't even close to its 10/31/07 high.

It was only when the QQQQ started to soften further, that the RELATIVE STRENGTH of AAPL gave in.

This leaves the question of a trader discipline of trying to short/put strong stocks at 52-week highs.

Once an INDEX breaks down, the STRONGEST STOCKS are last to fall and they tend to act like a sledge hammer and drive the WEAKEST stocks further into the ground. Yes, the WEAKEST stocks that were the BEST shorts.

The STRONGEST stocks then tend to LEAD an advance. And their rising tide will most often begin to "lift all boats."

Just "because" a stock was a LEADER before the decline, does that mean it will be a LEADER the next advance. Not necessarily so. But odds are higher that a STOCK that was LAST to lose favor due to the MARKET, or SECTOR it belongs to drags it down, will most-often be the stock(s) that once again attract the BULK of bullish capital.

Still, for the QQQQ/NDX/QLD/NQ, we KNOW what the MOST HEAVILY weighted stocks are. And they should be observed.

Jeff Bailey : 1/29/2008 10:22:43 PM

QLD Holdings ... just showing the "top 30", but bulk of weighting is in the "top 10" Link

I've been placing retracement brackets as shown for the QQQQ on the "top 10." I set al_rts at each of the fib levels.

By doing so, I don't need to actually watch 10 stocks at a time, but be "al_rt" when a level is traded.

For a BULL/strength, we'd like to see more UPSIDE al_rts traded. For a BEAR/weakness, we'd like to see more DOWNSIDE al_rts traded.

With the QQQQ/QLD trading so near its 19.1% retracement, or "lower end" of range marked, by tracking some of the most HEAVILY weighted components, we should get a greater number of observations of INTERNAL strength/weakness.

Jeff Bailey : 1/29/2008 10:10:26 PM

QLD Notes: Looking at what's "inside" the QLD and weighting. As of tonight's close, this 200% leveraged security (tracks QQQQ) held 2,917 e-mini NASDAQ-100 March'08 contracts. "Top 10" weighted are (AAPL, MSFT, QCOM, GOOG, CSCO, RIMM, ORCL, INTC, GILD, TEVA) 11-15 are (EBAY, CMCSA, GENZ, AMGN, CELG)

OI Technical Staff : 1/29/2008 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 : 1/29/2008 9:44:46 PM

Good recap/summary of YHOO's earnings, competitive environment, etc. Link

Jeff Bailey : 1/29/2008 9:41:20 PM

You have your mother's eyes ... Proof positive that MSFT is still a "key stock" for the QQQQ. Can see the resemblence ... MSFT/QQQQ Montage Link

There's NO WAY that you and I could possibly place retracement brackets on the other 99 QQQQ components. We can on the MOST HEAVILY WEIGHTED. (AAPL, MSFT, GOOG, QCOM, RIMM, CSCO, INTC, ORCL), and it clears things up a bit.

Jeff Bailey : 1/29/2008 9:01:05 PM

DJ- CNOOC Target Cut To HK$14.20 Vs. HK$15.18 By DBS Vickers ...

In today's MM at 03:42:14, I noted that it was "unusual" to see CEO's price above PTR's (MM Watch List). Not sure who DBS Vickers is, but not their call.

Maybe a "pairs trade" for arbitragers with a bear CEO and bull PTR.

Jeff Bailey : 1/29/2008 8:53:24 PM

Rio Tinto Says All Queensland Coal Mines Back In Production

DJ- Rio Tinto Ltd. (RTP) said Wednesday its coal mines in the Australian state of Queensland have restarted production after heavy rain disrupted operations.

The Kestrel mine, which was worst affected after access to the mine was cut off by flooding, has resumed operations and is expected to reach full production this week, according to company spokeswoman Amanda Buckley.

The Blair Athol mine had not been badly affected and production and shipments are on schedule, Buckley said, and the Hail Creek mine had more rain but is meeting a revised rail schedule.

"We have not had to declare force majeure and have been relatively unscathed," she said.

RTP $377.21 +1.96% ...

Jeff Bailey : 1/29/2008 8:47:00 PM

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

Yahoo! Inc.: At tonight's close, I'm going to place the VYH-AE in the "under review" category. No new bull trades at this point.

Refiners had a very strong day today, and it certainly looks that some capital sitting on the sidelines came into this portion of the energy group. Added a Tesoro TSO Aug $45 Call (TSO-HI) to the portfolio today.

Jeff Bailey : 1/29/2008 8:36:27 PM

Closing Internals at this Link

Jeff Bailey : 1/29/2008 8:36:00 PM

Closing U.S. Market Watch found at this Link

Tab Gilles : 1/29/2008 6:27:35 PM

I track quite a few charts, short-term and long-term. I've been watching the NDXA200 Nasdaq stocks trading above thier 200-ma. I use a weekly chart with a 5 week-ema. Below are 2 charts 2002 to 2005 and 2005 to 2008. The charts have the $NDX Nasdaq 100; NDXA200; $BPNDX Bullish %; & $NAHILO Nasdaq New High/Low.We are difinitely in oversold conditions...which may or may not remain for that much longer. The Yahoo news has tech selling off in after-hours, But all eyes will be watching the Fed tomorrow and then GOOG on Thursday. Those 2 catalysts if bullish could spark a rally in the NDX.

Link Link

Keene Little : 1/29/2008 5:40:13 PM

I received a question about my post with the daily chart of the DOW. I didn't adequately explain what I meant about two equal legs up and then eventually making it higher. Referring to the daily chart ( Link ), two equal legs up from last week would take it to 12800 and would be the first leg up in pink (consisting of the two equal legs up that I mentioned).

Then it would be due a pullback (pink leg down into early February) to be followed by another rally leg to above 13K. The larger move from last week's low would also likely achieve two larger equal legs up to the high in late February. The short term bullish scenario (pink) needs a break above 12724 to at least negate the sideways triangle idea shown in dark red (because it would overlap the bottom of wave (1) in November). Hopefully that makes a little more sense.

Jeff Bailey : 1/29/2008 5:13:51 PM

Yahoo! Inc. (YHOO) $20.81 +0.14% ... $18.79 here. Nobody seems overly bullish from the looks/sound of things.

Jeff Bailey : 1/29/2008 5:12:42 PM

I have a dinner/meeting I must get to. I'll try and update things later this evening.

Jeff Bailey : 1/29/2008 4:45:02 PM

Sterling Inds. (SLT) $19.94 -1.67% ...

Jeff Bailey : 1/29/2008 4:41:10 PM

Yahoo! Names Ari Balogh as Chief Tech Officer ... Press Release Link

Jeff Bailey : 1/29/2008 4:40:30 PM

Yahoo & AT&T Extend and Expand Strategic Alliance On Wireless and PC Screens ... Press Release Link

Jeff Bailey : 1/29/2008 4:36:46 PM

Yahoo! (YHOO) $20.81 +0.14% ... extended high/low has been $21.69/$18.90. $19.00 here.

Jeff Bailey : 1/29/2008 4:35:32 PM

Yahoo! (YHOO) ... Earnings Press Release Link

Analyst Estimates Link

Jeff Bailey : 1/29/2008 4:34:32 PM

CNBC review sounds as if forward revenue guidance below forecast.

Jeff Bailey : 1/29/2008 4:32:50 PM

Yahoo! (YHOO) $20.81% ... wild trade on headline numbers.

Jeff Bailey : 1/29/2008 4:32:03 PM

Baidu.com (BIDU) $270.71 -7.07% ...

Jeff Bailey : 1/29/2008 4:31:42 PM

Google (GOOG) $550.98 -0.89% ...

Jeff Bailey : 1/29/2008 4:31:00 PM

Yahoo! (YHOO) ... waiting on earnings.

Consensus is $0.11 on Rev of $1.41B.

Jeff Bailey : 1/29/2008 4:26:44 PM

AT&T $4B 3-Part Offering Priced; $2.5B 10Yr Tsry + 1.85

Jeff Bailey : 1/29/2008 4:24:42 PM

MM profiles currently long two (2) of the Yahoo Jan'09 $25 Calls.

If we were to get triggered on a 100 share short in the underying on some type of "knee jerk" to $32.50, might be worth being there.

Jeff Bailey : 1/29/2008 4:15:46 PM

You never know ... doesn't hurt to be ready ...

Jeff Bailey : 1/29/2008 4:15:00 PM

Just in case alert! ... Place an order to sell covered short 100 shares of Yahoo! Inc. (YHOO) $20.81 +0.14% ... for $32.50 (extended, day only).

Jeff Bailey : 1/29/2008 4:10:42 PM

I can also say ... with the methods of TRADE and ACCOUNT RISK management I (Jeff Bailey) have taught, or tried to teach traders over the years, even if you held a position in the stock, you will be fine longer-term. You're account will survive.

Jeff Bailey : 1/29/2008 4:06:00 PM

A lot of people and investment houses have "inside information." It's fine to have it. It is ILLEGAL to act on it.

Jeff Bailey : 1/29/2008 4:05:04 PM

Oh, I can ASSURE everyone that the stock I may have what could be deemed "inside information" on is NOT in the MM Profiles, nor is it in the Watch List. Nor have I traded it, or have I PROFILED it, or MENTIONED it for several weeks.

Jeff Bailey : 1/29/2008 4:03:30 PM

Didn' realize we were that near the close. I'm pretty sure at least one of the 14 is in our watch list. Probably not one of the mortgage insurers.

Keene Little : 1/29/2008 4:03:06 PM

The DOW is not far away from 12518, its August low then just above that is potential price level resistance near 12550. If it can press through this area then it should be able to make it up to the top of its parallel down-channel from October near 12800 which would also be two equal legs up from last week's low: Link

A rally above 12724 would confirm we'll likely see a rally make it above 13K before heading lower again (shown in pink). But if price stalls at or below 12550 and turns back down then we could get stuck in a large sideways triangle that plays out into March before heading lower again (dark red), confirmed with a drop below 11634. It's too early to tell which scenario is the more likely one and in the meantime we've got a very wide 1100-point spread between the key levels. I hope to narrow that considerably once a little more price action plays out.

Jeff Bailey : 1/29/2008 4:01:56 PM

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

Jeff Bailey : 1/29/2008 3:58:46 PM

MGIC Invest. Corp. (MTG) $17.90 +5.17% ...

Jeff Bailey : 1/29/2008 3:58:17 PM

Ambac (ABK) $12.67 +13.83% ...

Jeff Bailey : 1/29/2008 3:57:35 PM

MBIA Inc. (MBI) $16.18 +8.95% ...

Jeff Bailey : 1/29/2008 3:56:44 PM

CNBC reporting ... FBI has opened investigation into 14 companies regarding subprime mortgage. "Insider trading" was mentioned.

Jeff Bailey : 1/29/2008 3:56:05 PM

Speaking of "Orange Jump Suits" ...

Jeff Bailey : 1/29/2008 3:53:35 PM

Buy program premium DIA $124.72, SPY $136.12, QQQQ $44.42

Jeff Bailey : 1/29/2008 3:51:32 PM

What I want to do eventually is since I think "I know the bad news," I want to see MARKET reaction once everyone has the news. If the news comes out on earnings, and stock SURGES, then perhaps a bottom can be called.

Linda Piazza : 1/29/2008 3:51:16 PM

And again, although there was a breakout attempt, and although each attempt shoves the Keltner resistance a little higher, the SPX can't sustain 15-minute closes above that Keltner resistance, now at 1363.58 on 15-minute closes. Neither can the advdec line with resistance there now at about 1160 on 15-minute closes and with the advdec line now at 961.

If you've been in a bullish position since Monday morning, you've been glad to see pullbacks be minimal as the SPX hangs out above 1355, but if you're in an SPX call option that you entered at the open today, you're either at breakeven or underwater, and likely underwater due to the bid/ask spread.

Jeff Bailey : 1/29/2008 3:49:52 PM

One of my favorite movies ... "Wall Street" ...

Jeff Bailey : 1/29/2008 3:49:05 PM

Orange "jump suit" isn't my color. (wink)

Jeff Bailey : 1/29/2008 3:48:09 PM

Better safe than sorry.

Jeff Bailey : 1/29/2008 3:47:50 PM

Might be on the brink of "insider info" so can't say anything.

Jeff Bailey : 1/29/2008 3:47:18 PM

Keene! 01:49:05 ... Can't disclose at this point. Once announced, will review.

Jeff Bailey : 1/29/2008 3:42:14 PM

haven't seen this in some time ... CEO $149.12 and PTR $147.60.

Usually, PTR price HIGHER than CEO, by $1, or $2 at a minimum.

Jeff Bailey : 1/29/2008 3:36:14 PM

Especially in options.

Jeff Bailey : 1/29/2008 3:35:08 PM

Yep, $0.90. Don't like them.

Jeff Bailey : 1/29/2008 3:34:34 PM

Remember QQQ-AX exit on 12/11/07 at $52.20? I do.

Jeff Bailey : 1/29/2008 3:33:44 PM

Hmmm ... on 12/11/07 ... DIA session high was $137.90

Jeff Bailey : 1/29/2008 3:27:56 PM

DIA $124.84 +1.06% ... high has been $124.90. That's $0.10 shy of "large blocks mid-points"

Jeff Bailey : 1/29/2008 3:27:13 PM

IBM's DAILY R2 here at $106.74. WKLY R1 at $108.44.

Linda Piazza : 1/29/2008 3:25:37 PM

If the SPX is able to charge higher, I'd watch for potential resistance near 1367-1369. Although the 15-minute chart suggests a higher target, the 30-minute one doesn't, and there's Friday's early-morning high to consider, too. Evaluate soon what you want to do about carrying a position overnight with the FOMC decision tomorrow as well as a number of economic numbers. For example, I believe the ADP may come out tomorrow, and that will give the Fed some insight into the Nonfarm Payrolls figure.

Jeff Bailey : 1/29/2008 3:25:16 PM

IBM Alert! $106.59 +1.54% ... 38.2% conventional.

Linda Piazza : 1/29/2008 3:22:10 PM

The advdec line's nearest Keltner resistance held, too, on the last 15-minute close, but the advdec line is back at 1079 now, trying again, with Keltner resistance for it now at about 1150 on 15-minute closes.

Linda Piazza : 1/29/2008 3:21:09 PM

The SPX's resistance, near 1362.50 on 15-minute closes, held on that last 15-minute close. That resistance is being shoved higher through the day, as the SPX consolidates near it, but the SPX isn't really able to break through it. The longer that situation persists, the more likely it is that the SPX will eventually have to drop back farther to recharge. Bulls would prefer a breakout and a charging up to the next channel line, now near 1380-1381. So far, no target that high has been set by the Keltner charts, though, as resistance continues to hold.

Jeff Bailey : 1/29/2008 3:20:28 PM

Gett'n close .. DIA $124.72

Keene Little : 1/29/2008 3:18:12 PM

A break of the uptrend line from yesterday morning, confirmed with a break below 1355, would be a sell signal but it's a tough call how much of a pullback we could get. A drop back down to retest the broken downtrend line from Dec 26th would be down to about 1343. A 62% retracement of the rally, assuming it tops out around 1370, would mean a pullback to 1341.

Jeff Bailey : 1/29/2008 3:16:46 PM

03:00 Internals found at this Link

Jeff Bailey : 1/29/2008 3:15:31 PM

Might want to use "groundhog" with "Groundhog Day" this Saturday.

Keene Little : 1/29/2008 3:15:03 PM

There is a Fib projection for the next leg up, if that's what has started (NDX still has me wondering about that), at SPX 1370, matching the August 1370 low. If tagged we could then see another pullback from there. SPX 10-min chart showing how it could play out if it pushes a little higher: Link

Jeff Bailey : 1/29/2008 3:14:59 PM

Last time DJUSHB "prairie dogged" its 150-day SMA was on 5/23/07 and next morning of 05/24/07.

Jeff Bailey : 1/29/2008 3:13:53 PM

DJ US Home Construction (DJUSHB) Alert! 389.07 +4.49% ... takes a look above its 150-day SMA (389.07). (see last night's WKLY interval chart)

Linda Piazza : 1/29/2008 3:12:29 PM

I'd like to see volume lead the price patterns, not the other way around, but the advdec line is rising as the prices rise to test the day's high. The advdec line is far from a new day's high but is testing the nearest potential resistance on 15-minute closes. That's been shoved up to about 1120 right now, with the advdec line now at 1136. Meanwhile, the SPX is above but hasn't closed a 15-minute period above the 1162.50-ish potential Keltner resistance. The jury is still out, but this is the most excitement we've had all afternoon. While this could be a breakout, it's certainly not proven yet. This Keltner resistance could still hold.

Jeff Bailey : 1/29/2008 3:10:06 PM

Volume looking rather "brisk" at the big board.

Keene Little : 1/29/2008 3:04:49 PM

Another 30 minutes for a repeat performance? Yesterday's MOC orders spiked the market higher into the close after a late-day pullback. After a listless day I'm wondering if we'll see it happen again. So far the bounce from this afternoon's low is not making me feel bullish here. We're due a program trade in one direction or the other.

Linda Piazza : 1/29/2008 2:55:56 PM

If this keeps up until tomorrow's FOMC decision, there will certainly be plenty of pent-up energy, won't there? Nearest SPX resistance up to 1362 on 15-minute closes. Nearest support down to 1351.69 on 15-minute closes. I'm watching the advdec line for a first sign of something changing, but I'm not seeing anything yet.

Jeff Bailey : 1/29/2008 2:52:10 PM

Do you see how the DAILY, WEEKLY, MONTHLY pivot levels are used by institutional computers?

Just as we can "understand" these retracement (AAPL, MSFT, GOOG, QCOM, RIMM, etc), institutional computers will are able to use their computing power to narrow down the "range of retracement" and manage their inventory as supply and demand plays out.

Jeff Bailey : 1/29/2008 2:47:31 PM

QCOM $40.22 -0.69% ... with a 10/05/07 to 01/22/08 retracement. Like we have on the QQQQ/QLD. Link

Linda Piazza : 1/29/2008 2:47:02 PM

Even the advdec line is consolidating! In the case of the advdec line, it's consolidating today between about +460 support and 1010 resistance. It's at 776 as I type, near the middle. RSI for the advdec line is 49.06, at the neutral level. No predictions there.

Linda Piazza : 1/29/2008 2:34:30 PM

The SPX did not hit its downside target before erasing it, not such a surprising event. I'd just pointed out in my 2:02:44 post that this was a setup in which targets weren't particularly valid. So, I'll point out a current upside target of 1361.59, but I don't know whether you should count on that one being hit, either.

Jeff Bailey : 1/29/2008 2:35:22 PM

GOOG ... same thing done as in AAPL Link

Keene Little : 1/29/2008 2:31:00 PM

With today's sideways consolidation there is the potential for it to resolve to the upside. The consolidation could be complete now so any push higher from here to new daily highs should have some follow through. But it might be relatively short lived, especially with some tough resistance at SPX 1368-1370.

Jeff Bailey : 1/29/2008 3:46:21 PM

Look at how nice these stocks have "broken down" at trends. Don't have to be a hero and try and pick tops, or bottoms.

Jeff Bailey : 1/29/2008 2:20:55 PM

Might "make sense" ... YHOO hasn't been tearing up the joint.

Jeff Bailey : 1/29/2008 2:20:16 PM

Doing same thing for GOOG. See how it becomes a "troubled child?" for bull?

Jeff Bailey : 1/29/2008 2:17:37 PM

One thing I do like about QCharts is I can slap on these retracement, get things in synch, "right click" the retracement bracket and set al_rts at the 100%, 80.9%, 61.8%, 50%, 38.2%, 19.1% and 0% retracement.

Jeff Bailey : 1/29/2008 2:16:14 PM

Hmph ... check out MSFT with a "conventional" from 11/02/07 high to recent relative lows. That earnings surge stopped dead at 61.8% ($35.03) on Thursday. 19.1% at $32.27.

Jeff Bailey : 1/29/2008 2:08:52 PM

Energy Futures I'm tracking at 01:30 PM EST benchmark Link

Reminder: Feb Unleaded (rb08g) final settlement/expire is Thursday 01/31/08.

Today's action in the refiners has little (that I can see) to do with the crack spread.

Linda Piazza : 1/29/2008 2:02:44 PM

Just chop. Sorry, but the SPX has settled into the pattern that I feared it might settle into, in which a punch above or below a formerly key benchmark average means little. Upside or downside targets are set but not met. Right now, there's a current downside target of about 1351-1353, but will it be met? Who knows.

Jeff Bailey : 1/29/2008 1:55:45 PM

AAPL $130.44 +0.33% ... with "conventional" (blue) to mark a range. Another "conventional" as AAPL's relative strength longer-term strong. Some trends, and marking its BEARISH vertical count. Link

Keene Little : 1/29/2008 1:49:08 PM

Jeff! I of course have no clue what you're talking about--no company name, no sector (except non-ferrous), no price pattern, no help.

Jeff Bailey : 1/29/2008 1:49:05 PM

Keene! That industrial contact I mentioned the other day. The one that said some Q1 orders had been cancelled last week? It's up nice today. Has closed above its 19.1% "conventional" retracement last two (2) days. Threatens to do so even more today.

Keene Little : 1/29/2008 1:39:54 PM

CME has started a pullback that I expected to see after the big spike up off last week's low. The short term pattern supports the idea that we'll get another leg down in its pullback from Monday's early morning high. Two equal legs down gives us a downside target near 575 and that would get it down near its uptrend line from April 2005. I think that would be a good setup for the long side for another leg back up, perhaps into February's opex week: Link

Jane Fox : 1/29/2008 1:38:30 PM

It better not turn around and rally now!!! smile

Jane Fox : 1/29/2008 1:37:58 PM

YM made a low of 12408 so we are out of the long.

Keene Little : 1/29/2008 1:33:26 PM

AAPL's daily chart shows a wave count that calls for another leg down to complete the 5th wave for the move down from its late-December high: Link . If you look at the 60-min chart you will see what looks like a sideways consolidation pattern and that looks bearish for another leg down. The August low at 111.62 makes for a good downside target and I could see a buying opportunity there for a bounce back up to correct the January decline.

Jeff Bailey : 1/29/2008 1:40:04 PM

YRCW option montage from yesterday Link

Best I can do for Open Interest at this point is go to CBOE and get a screen capture of February Link

OK, institutional traders tend to SELL premium.

The YUX-NC open interest ROSE from 4,516 to 6,771. So, we now "know" that this was largely "sell to open". Let's say, "sold for $0.90 the $15.00," which is an OBLIGATION to buy the stock at $15.00. RISK begins at $15 - $0.90 = $14.10

The YUX-BD saw open interest fall from 3,649 to 2,799. The DECLINE in OI suggests "long liquidation" or "sell to close" as if short-term bulls gave up on anything above $20.00 on or before February expiration.

Jeff Bailey : 1/29/2008 1:26:43 PM

I picked up a small, and I do mean SMALL position in PAL at $4.35 in personal account.

Based on my 2008 forecast, and history of PAL, very speculative. Trade/invest at your own risk. To be bullish, you're playing the "catch up" trade.

Keene Little : 1/29/2008 1:25:30 PM

The high flyers (GOOG and AAPL for example) are not flying so high. In fact they're not even holding up the bounce off last week's lows. GOOG's daily chart here shows the potential for a continuation lower in stair-step fashion (dark red). It needs to rally back above last Friday's high, the key upside level at 595, in order to get on a short term bullish price path (pink) which could then take it back up towards 650 into March: Link

Jeff Bailey : 1/29/2008 1:24:47 PM

Oooo... trying to make a move ... PAL $4.71 +0.85% ...

Jeff Bailey : 1/29/2008 1:24:23 PM

SWC $10.28 +0.68% ...

Jeff Bailey : 1/29/2008 1:24:03 PM

March Palladium (pa08h) Alert! 393.30 +0.49% ... challenges major resitance high again. (see Friday's MM)

Jeff Bailey : 1/29/2008 1:21:51 PM

Example: I'm looking at same option montage as yesterday, YUX-NC showing nothing, not even a "O" for Open-Interest. Switching servers, looking for one that has it.

Jeff Bailey : 1/29/2008 1:20:12 PM

Qcharts is simply HORRIBLE with their options. All the "great changes" from merger. Not seeing it with their options.

Jeff Bailey : 1/29/2008 1:18:49 PM

That reminds me ... YRCW $15.91 -1.05% ... wanted to check any changes to Open Interest. Check yesterday's analysis.

Jeff Bailey : 1/29/2008 1:15:41 PM

Any of yesterday's "unusual option activity" stocks acting "unusual" today?

Jeff Bailey : 1/29/2008 1:13:12 PM

01:00 Internals found at this Link

Jeff Bailey : 1/29/2008 1:01:13 PM

SPY short interest Link

Keene Little : 1/29/2008 1:00:30 PM

We've got a little corrective bounce here so we should see prices head lower even if the bounce gets a little larger first.

Jeff Bailey : 1/29/2008 12:59:53 PM

CNBC ... mentioning short interest.

Linda Piazza : 1/29/2008 12:59:09 PM

Friday, I began mentioning the possibility that the SPX could be settling into the pre-FOMC chop already. Yesterday morning and afternoon, I mentioned it again. In my 3:23:42 post yesterday, I mentioned that it looked as if the SPX's Keltner channels were indeed settling into the configuration that presaged consolidation. At that time, I said that it was beginning to look as if anything between 1325 and 1365 was chop. Today, the channels are at slightly different levels, at about 1330 and 1360, but I'd still suspect anything between 1325 and 1365 of being chop, and chop that's going to be increasingly difficult to decipher.

Right now, unless the SPX can maintain 15-minute closes above the 9-ema now at just above 1357.10 or so, it may be vulnerable to 1349 if not 1342.

Jeff Bailey : 1/29/2008 12:55:35 PM

Again ... traders can at least utilize conventional retracement as I've discussed/shown in recent sessions.

Jeff Bailey : 1/29/2008 12:54:33 PM

AAPL Link ... achieves bearish vertical count but QLD needs its strength!
MSFT Link ... needs $37 to negate bearish vertical count.
GOOG Link ... achieved bearish vertical count, but QLD needs its strength!
QCOM Link ... one of few $BPNDX on a "buy signal" with bullish vertical count to $52.
RIMM Link ... recent trade at $93 is revershing high PnF "buy signal" with bullish vertical count" to $136. In play as long as $89.00 not traded.

Jeff Bailey : 1/29/2008 12:46:58 PM

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

Jeff Bailey : 1/29/2008 12:39:32 PM

TRIN 1.02

Jeff Bailey : 1/29/2008 12:35:16 PM

TSO ... "news" headline ... "Refiners will feel the squeeze" from 10/2/07. What did $GASO:$WTIC say about that? TSO surged from relative low $47.39 to all-time high 10/26/07.

Jane Fox : 1/29/2008 12:33:32 PM

Hanging in there - low of 12411 and stop at 12409.

Jeff Bailey : 1/29/2008 12:32:59 PM

There it is. TSO announcement on 09/25/07 Link

"Makes Sense"

Linda Piazza : 1/29/2008 12:31:47 PM

Is our time stamp a minute or two off or is my computer? Fifteen-minute candles from my feed source seem more in tune with my computer's time stamp than that on the MM.

Jeff Bailey : 1/29/2008 12:30:53 PM

TSO ... "news" archive from that 09/26/07 volume spike. Was there "news?" If so, what was it? Link

Linda Piazza : 1/29/2008 12:30:31 PM

And there goes the SPX, down to test the lower support of the blue channel. Currently, it's below that blue channel's support, slightly, but there's still a minute or two left in this 15-minute period and the support was actually also pushed a little lower. Mostly it's holding for now, but there are no guarantees it will continue to do so. A test of 1349 can't be ruled out.

Keene Little : 1/29/2008 12:30:11 PM

Taking out the lows near 10:45 leaves the bounce off this morning's low as a 3-wave correction and likely means this morning's lows will get taken out. Either that or we'll remain in a choppy consolidation for the rest of the day. In either case it's not bullish for at least the short term.

Jeff Bailey : 1/29/2008 12:28:31 PM

Tesoro (TSO) $41.09 +7.03% ... daily interva bar chart Link

Conventional retracement to define the range. Note TSO's bullish vertical count. Under backdrop of "modest recession for 2008" does the BVC make sense? Can TSO make it back this summer? Is there enough oil? Is there enough gasoline? What's the weather forecast? What will crack spreads look like?

Linda Piazza : 1/29/2008 12:27:14 PM

During the lunchtime lull, it's not unusual for the SPX to travel the entire width of the smallest channel rather than finding S/R at the 9-ema, which is the basis line for that channel. The smallest channel's lower support line is now near 1356, so bulls would like to see the SPX find support there on 15-minute closes. As I warned just before the bell, that 1361-1362 zone has continued to be resistance on 15-minute closes. Although support is maintained, the action today is not impressive and the SPX has never convincingly pulled free of resistance, so I can't make a prediction as to whether support will continue to hold.

Jeff Bailey : 1/29/2008 12:11:15 PM

For "birds of a feather," PnF chartists may utilize a stock's Bull/bear vertical count to try and get a feel for where others in the group might be headed.

You can see we have a lot of "long tail down" patterns that are being reversed.

IF TSO $41.02 +6.85% were to trade $62.00, that would equate to a 53% gain.

Could then "benchmark" others at current levels to ascertain longer-term REWARD/RISK.

Jeff Bailey : 1/29/2008 12:08:10 PM

Refiner Technical Note: TSO is the only major refiner's PnF chart that currently gives us a bullish vertical count ...
VLO Link
SUN Link
FTO Link
MRO Link

Keene Little : 1/29/2008 12:05:09 PM

The market needs another goose. Speaking of being goosed, Mother Goose (MER) got a little goose herself this morning--gapping up to start the day. Unfortunately it was immediately sold into and spiked down below yesterday's close. It has since bounced back up but is right at the flat line and looks like it could tip back over. This too gives me the sense that today could be just a consolidation day. If the broader market doesn't get goosed here with a buy program or two I think it will tip back over.

Jeff Bailey : 1/29/2008 12:00:47 PM

Tesoro (TSO) $41.00 +6.79% ... PnF chart Link ... Target is $59.50 (80.9% conventional retracement). Bull vertical count to $62 gives additional room IF achieved. August PLENTY of time for what we're playing, looking for into summer driving season.

Linda Piazza : 1/29/2008 11:47:23 AM

I'm back, and I see there's not much progress. The SPX has potential nearby support at about 1357.80 on 15-minute closes and potential nearby resistance at 1364.25 on 15-minute closes.

Jeff Bailey : 1/29/2008 11:49:51 AM

IMF: Cuts '08 Global Growth Forecast To 4.1% From 4.4%
Lowers '08 US Growth Estimate To 1.5% from 1.9%.
See US Stimulus Adding 0.2-0.3 Pct Pt To '08 Growth.
Cuts '08 Euro Area Growth Forecast To 1.6% From 2.1%
Trims '08 Japan Growth Estimate To 1.5% From 1.7%
Saying Global Growth Risks Still "Tilted To Downside"
Emerging Markets "Resilient," But Face Challenges.
Financial Market Turmoil Remains Biggest Risk To Growth
Central Banks Face Challenge Balancing Growth,Inflation
Central Banks Must Remain Flexible, Consider Joint Moves

Jeff Bailey : 1/29/2008 11:34:47 AM

Currency Alert! ... DJ- FOCUS ... Forex Markets Start Favoring Rate-Slashing Central Banks ... Economic growth could replace interest rates as a primary driver for currency markets. That's why the foreign exchange market expects a dollar rally if the U.S. Federal Reserve delivers a 50-basis-point interest rate cut, writes Katie Martin.

Keene Little : 1/29/2008 11:32:46 AM

SPX 1365 (ES 1368.50) is where the move up from yesterday morning would have two equal legs up, which is just under Friday's high of 1368 (ES 1370.75).

Keene Little : 1/29/2008 11:30:44 AM

Yesterday's rally had me thinking it was corrective and that it would lead to a drop back down below the morning lows. Then the quick burst higher at the end of the day changed it to having the possibility that we'd see a 3rd of a 3rd wave higher this morning and the gap up suggested that's what we'd get. But that bullish setup coming into this morning hasn't exactly followed through.

The move up this morning should have kept rallying if the bullish setup was to be real. The fact that the rally has stalled tells me that we may be stuck in a choppy consolidation and could see a drop back into yesterday's trading range. If the market can push a little higher, watch DOW 12500 where the rally off yesterday morning's low would have two equal legs up since that could cap the rally. It would also be a retest of last Friday's high.

Jane Fox : 1/29/2008 11:24:23 AM

Target is a 1:1 risk to reward ratio so sitting at 12514. Once YM hits the 12498-12499 area I will be ratching up the stop or even thinking of taking my profits. alert

Jane Fox : 1/29/2008 11:22:59 AM

Raise the stop to 12409. Not much but a little.

Jeff Bailey : 1/29/2008 11:19:26 AM

At this moment, I'm unable to uncover any "news" to explain FTO +14.61% action.

Jeff Bailey : 1/29/2008 11:18:51 AM

OPEC OUTPUT UP SLIGHTLY, ENOUGH FOR 2Q

DJ- Crude production from Organization of Petroleum Exporting Countries is higher in January, and present output is sufficient to meet its share of global oil demand in the seasonally weaker 2Q period, says tanker tracker Petrologistics.

Jeff Bailey : 1/29/2008 11:17:59 AM

VALERO 4Q NET FALLS 49% ON MARGIN SQUEEZE

DJ- Oil refiner's 4Q net income drops to $567 million, or $1.02 a share, while revenue increases 52% to $28.67 billion. Analysts expected EPS of 64c on revenue of $24.23 billion.

VLO $60.09 +9.45% ...

Last night's $GASO:$WTIC 0.40 box Link

Jeff Bailey : 1/29/2008 11:15:41 AM

CASE-SHILLER SHOWS HOME PRICES STILL SINKING

DJ- Home prices in 10 major metropolitan areas in November are down 8.4% from a year earlier, according to the S&P/Case-Shiller home-price indexes. November is the 11th consecutive month of negative annual returns.

Jeff Bailey : 1/29/2008 11:14:00 AM

Good gravy! Frontier Oil (FTO) $36.94 +15.07% ...

Jeff Bailey : 1/29/2008 11:13:04 AM

11:00 Internals found at this Link

Keene Little : 1/29/2008 11:13:04 AM

The DOW is relatively strong this morning but with the techs hanging back I'm wondering if we've got the setup for just chop today.

Jane Fox : 1/29/2008 11:08:26 AM

YM long from 12456 and a stop at 12398.

Jane Fox : 1/29/2008 11:05:42 AM

We are still waiting for YM long trigger but so far no cigar.

Jeff Bailey : 1/29/2008 10:58:45 AM

Only two "silver" miners I know of.

Jeff Bailey : 1/29/2008 10:57:59 AM

Coeur D Alene Mines (CDE) $4.65 +0.65% ... little bugger.

Jeff Bailey : 1/29/2008 10:56:53 AM

Apex Silver (SIL) $14.59 -2.34% ... nothing.

Jeff Bailey : 1/29/2008 10:56:21 AM

iShares Silver (SLV) $165.50 (unch) ... early action hints that shorts a bit jittery. Taking opportunity to cover at old 52-week highs.

Jane Fox : 1/29/2008 10:50:53 AM

AD volume is making new daily highs but the AD ratio is not and the VIX is not making new daily lows. Remember I used to say if the AD volume was making new daily highs don't even think about been short? Well I have revised that now with the AD ratio and VIX have to agree. Learning how to read the internals is certainly an on-going process. Link

Linda Piazza : 1/29/2008 10:48:47 AM

I'm going to be away from my desk for a time, perhaps up to an hour.

Jeff Bailey : 1/29/2008 10:47:26 AM

EIA: Revised Nov Gasoline Use Flat On Yr, -0.2% Vs. Estimate

Linda Piazza : 1/29/2008 10:46:52 AM

Nearest SPX potential support is at 1357.24 on 15-minute closes. The 9-ema is lower, currently at 1354.55 on 15-minute closes. Nearest resistance is at 1362.62 on 15-minute closes.

Keene Little : 1/29/2008 10:46:22 AM

The strong bounce back up this morning did not get prices to new daily highs and that keeps open the possibility that the bounce will fail. The bulls obviously want to see a pullback to a higher low and then a continuation higher. There is the possibility that we'll see a choppy consolidation into tomorrow (which would likely be a bullish continuation pattern) so be careful about getting whipped around.

Jeff Bailey : 1/29/2008 10:46:17 AM

EIA: Revised November Oil Use +0.2% on Year, -0.9% Vs. Estimate
Revised Nov Oil Use Most In Any Month Since Aug'07
Revised Nov Oil Use 20.7M B/D, Most In November Since 2004

Jeff Bailey : 1/29/2008 10:40:06 AM

CME's Regional Housing Futures (Feb'09-Nov'09) table I keep track of Link

Jeff Bailey : 1/29/2008 10:35:13 AM

CME's Regional Housing Futures (Feb'08-Nov'08) table I keep track of Link

Jeff Bailey : 1/29/2008 10:30:27 AM

Nevada Had Top Foreclosure Rate In 2007 AP Story Link ... No surprise here for those following my CME Regional Housing Futures updates.

Jane Fox : 1/29/2008 10:29:17 AM

I see a long YM at 12456 with a stop at 12398. alert

Jeff Bailey : 1/29/2008 10:28:41 AM

As you can see from the SLV chart, yesterday's action was another 52-weeker on move above $164.45. Morning low has been Thursday and Friday's highs.

Jeff Bailey : 1/29/2008 10:26:46 AM

iShares Silver Trust (SLV) $164.74 -0.45% ... decent volume spike of 89,000 in first 5-minutes.

Jeff Bailey : 1/29/2008 10:25:33 AM

Biiiiiig volume spike in the StreetTracks Gold (GLD) $91.22 -0.57% in first 5 minutes this morning. 1.55 million shares.

DXY 75.60 +0.02% ... tries to firm at MONTHLY S1 (see yesterday's MM)

Linda Piazza : 1/29/2008 10:25:49 AM

There's slight improvement in the SPX Keltner outlook, with the SPX maintaining values above 1357 so far, but it's not particularly convincing yet. The SPX did shove the top marker of the current resistance higher, to about 1359.80, but it's not convincingly breaking out above it yet, so it may yet need another pullback to the rising 9-ema, now at 1353.21. That's not promised, but it's certainly not ruled out, either. The outlook is just a bit unclear at the moment.

Keene Little : 1/29/2008 10:22:19 AM

If you're long this morning's bounce back up you want your stop at a new daily low. That low can't break now otherwise the pattern will turn more bearish.

Jeff Bailey : 1/29/2008 10:15:21 AM

Swing trade call option alert! ... for one (1) of the Tesoro TSO Aug $45 Calls (TSO-HI) at the offer of $5.50.

TSO $41.50 +8.23% ...

Linda Piazza : 1/29/2008 10:09:15 AM

The SPX did bounce from the 15-minute 9-ema. That average is now at 1351.16 and should be considered nearest potential support. However, the 1356.39-1357.70 area should now be considered potential resistance on 15-minute closes. The SPX needs to get back above that and maintain values above that to improve its outlook. Right now, the 15-minute chart doesn't give an upside target other than those tests of 1356-1358.

Jeff Bailey : 1/29/2008 10:09:11 AM

US Conference Board Jan Consumer Confidence 87.9 Vs. December's 90.6
Jan Present Situation 115.3 Vs. Dec 112.9
Jan Expectations Index 69.6 Vs. Dec 75.8

Jeff Bailey : 1/29/2008 10:06:30 AM

Bear Stearns Ups Chile Stocks To "Overweight" From "Market Weight"

Keene Little : 1/29/2008 10:06:00 AM

So if you're feeling bullish for a run higher into tomorrow, this is the place to try the long side.

Keene Little : 1/29/2008 10:05:15 AM

Sorry, I was looking at a shorter term downtrend line for SPX. Its downtrend line from 12/26 is right here at 1352.

Jane Fox : 1/29/2008 10:05:03 AM

Jan. consumer confidence above 87.5 expected

Jan. consumer confidence 87.9 vs. 90.6 in Dec.

Keene Little : 1/29/2008 10:03:55 AM

The big test for SPX, assuming it continues to pull back this morning, will be its broken downtrend line from Dec 26th, currently just below 1346. ES is there now at its line near 1353.

Linda Piazza : 1/29/2008 10:03:42 AM

The advdec line dropped through the 350-ish Keltner support. Next support is near -200 down to -450.

Jeff Bailey : 1/29/2008 10:02:12 AM

Refiners "hot" early.

Jeff Bailey : 1/29/2008 10:01:45 AM

Tesoro (TSO) $40.70 +6.01% ...

Jeff Bailey : 1/29/2008 10:01:19 AM

Marothon Oil (MRO) $52.04 +3.99% ...

Jeff Bailey : 1/29/2008 10:00:39 AM

Sunoco (SUN) $63.76 +4.26% ...

Linda Piazza : 1/29/2008 10:00:25 AM

If the SPX's 1356-ish Keltner support doesn't hold on this 15-minute close, next potential support you want to hold is at the 15-minute 9-ema, now at 1350.53. However, that's not as good a position as it would if the SPX had held the 1356 support.

Keene Little : 1/29/2008 10:00:13 AM

I don't like the fact that the techs and small caps have dropped into the red after their gaps to the upside this morning. It sets a bearish tone.

Jeff Bailey : 1/29/2008 9:59:07 AM

Frontier Oil (FTO) $36.02 +12.21% ...

Jane Fox : 1/29/2008 9:59:03 AM

Consumer Confidence out at 10:00.

Keene Little : 1/29/2008 9:58:58 AM

I mentioned yesterday an upside Fib projection at 931.30 for gold (February contract). That was tagged earlier this morning during pre-market trading. GLD has broken the uptrend line from Jan 23rd and that's a sell signal, stop at a new high. I've drawn in a parallel line to the one along the highs since last week's low to show where support might be found if gold is in a larger upside pattern. Updated 60-min chart of GLD: Link

The key level to the downside is the low on Friday, Jan 25th, at 89.51. A break below that level would confirm a top is in. There is still the potential for one more push higher to just shy of 93 before the gold rally finishes (shown in pink) which is why the stop on a short needs to be at a new high.

Jane Fox : 1/29/2008 9:57:39 AM

AD line is now a neutral +293 and the VIX is making new daily highs.

Linda Piazza : 1/29/2008 9:56:46 AM

So far, the SPX's pullback is finding support where bulls hope it will. The TRAN is pulling back, as expected, but only slightly so far. The advdec line is indeed dropping right down toward that 350 level that I had mentioned as a target. It's at 342 as I type. Bulls really, really want this level to hold on the advdec line and for there to be a bounce.

Linda Piazza : 1/29/2008 9:51:31 AM

From a Keltner outlook, the advdec line has room for improvement but isn't looking particularly grand today. It's in the upper, bullish half of the 15-minute Keltner charts, but it ran right up and hit the 9-ema and was knocked right back. It's approaching the low of the day as I type. From a Keltner standpoint, unless it can maintain values above about 1250 (9-ema) on 15-minute closes and particularly above about 850 on 15-minute closes, then it's got a downside target near 350. It's at 780 as I type.

Linda Piazza : 1/29/2008 9:48:37 AM

As suspected (9:25:15 post), the SPX finds at least short-term resistance in the 1361-1362 zone. SPX traders who hope to see more upside gains would prefer that the SPX find support on 15-minute closes at about 1356. The SPX is at 1358.92 as I type.

Jane Fox : 1/29/2008 9:44:48 AM

I think the S&P has a very good chance of making the 1400 resistance and then the bulls will have to pull the proverbial rabbit out of the hat to make it to the next resistance at 1520. In any case expect a retracement from the 1400 area and if the bears are able to take this market back to yearly lows and close below then I think we have entered a bear market. That is a bold statement I know but IMHO so far we have just had a severe correction but have not yet entered a bear market. Link

Jeff Bailey : 1/29/2008 9:46:01 AM

Valero (VLO) ... Earnings Press Release Link

Consensus was for EPS of $0.64 on Revenue of $24.23 billion.

Jeff Bailey : 1/29/2008 9:43:09 AM

Valero Energy (VLO) Alert! $61.12 +11.31% ... what the heck is going on!

Linda Piazza : 1/29/2008 9:42:55 AM

The TRAN is higher, approaching Keltner resistance near 4600 on 15-minute closes. RSI on the 15-minute chart is extreme, now at 85.57 with the TRAN at 4584.15. I've seen the TRAN continue higher for another hour to two hours while the RSI trends above 70 on this chart before the TRAN pulls back, but traders should be aware that this indicator index may need to pull back or consolidate sideways to sideways down sometime this morning. Such pullbacks or consolidation periods sometimes do impact the SPX along with the OEX and Dow. Watch the TRAN, too, if you're trading those.

Jeff Bailey : 1/29/2008 9:41:38 AM

Sovereign Bancorp (SOV) $11.35 +1.70% ... Had an alert set here to see 01/14/08 MM (earnings warning).

Keene Little : 1/29/2008 9:37:46 AM

The bulls liked the durable goods number for an indication the economy is doing better than expected. And they like the idea that the Fed will cut rates another .50%. It's a bit like having your cake and eating it too. Trade the long side (if this gap up holds) but don't fall in love with it. I sense some disappointment tomorrow if we rally into FOMC.

Jane Fox : 1/29/2008 9:36:39 AM

VIX is hoevering at daily lows but still too early to make any kind of direction from this "internal."

Jane Fox : 1/29/2008 9:35:00 AM

AD line a bullish +1029.

Linda Piazza : 1/29/2008 9:31:52 AM

For OEX traders, the OEX shows potential resistance on 15-minute closes near 639.

Keene Little : 1/29/2008 9:31:49 AM

With a bullish start to the morning it looks like the bulls could get some follow through from yesterday's rally. The 2nd leg up in the bounce off last week's lows looks good as long as there's not a gap n crap this morning. The short term pattern for yesterday's rally, with a gap up this morning, suggests the gap will not be filled if we're to see another leg higher in the bounce.

But SPX will gap above its downtrend line from Dec 26th so even if it does pull back to close the gap, or a little lower, it will be an opportunity to test the broken downtrend line and try the long side. But as I said, there's a good chance it will not pull back for a retest (the gap would get closed later, not today). The upside projection is the top of its down-channel from October and the projection for two equal legs up near 1401.

Linda Piazza : 1/29/2008 9:25:15 AM

SPX futures closed about 8 points above fair value. We can't always count on futures values carrying through on the open, but if they do, that should bring the SPX close to 1362. Friday morning, the SPX punched well above 1362, but the first few 15-minute candles had opens, closes, highs or lows near that level, so it looked that day, at least, as if the 1362-1363 level was resistance on 15-minute closes. Be aware of that possibility without considering it as strong as a prediction. Of course, Friday's 1368.56 high should be considered potential resistance, too. This is backed up by Keltner evidence, showing potential resistance on 30-minute closes near 1368.

Jane Fox : 1/29/2008 9:14:16 AM

The chart of the US$ is not looking too healthy but there are so many political influences on the market the charts are not always your best guide. However they are my only guide for I do not take into account other people's analysis due to the fact that I do not know what kind of hidden agenda they may have.

Actually that is not entirely true, there are few who I believe have a very good grasp on markets and tell it how they see it. Link

Jane Fox : 1/29/2008 9:09:06 AM

The only consolation for missing the Gold trade is that I am long Crude (I have calls on the ETF USO) and will be long until support at the 85-86 area is breached. Link

Jane Fox : 1/29/2008 9:06:52 AM

Gold is certainly not a market I would short but I do see it taking a rest for a while, at least I hope it does because it has not gotten to a level where I feel comfortable jumping on board long. my last attempt was at 850 but like I have mentioned numerous times, it reached 855 but not 850 Link

Jane Fox : 1/29/2008 9:04:31 AM

Overnight markets all have the same pattern and all have broken their respective previous day highs. I believe the AD line will open quite bullish. However, that is not to say I know how the rest of the day will trade but I am bullish until the S&P at least tests resistance at 1400. Link

Jane Fox : 1/29/2008 9:01:38 AM

Of course that last post was tongue in cheek.

Jane Fox : 1/29/2008 9:00:39 AM

ANNANDALE, Va. (MarketWatch) -- As if the stock market didn't already have several strikes against it, here's another: The New England Patriots are 12-point favorites to win this Sunday's Super Bowl.

Those odds add up to a bearish forecast because of the venerable Super Bowl Indicator, which became popular in the early 1980s on the basis of a supposedly near-perfect track record.

According to it, the stock market does well in years following Super Bowl wins by teams that trace their roots back to the original National Football League -- and poorly if the winning team's roots are in the old American Football League.

Jane Fox : 1/29/2008 8:57:04 AM

WASHINGTON (MarketWatch) -- The Federal Open Market Committee is likely to cut rates again by a half-point on Wednesday, according to former top Fed staffer Vincent Reinhart.

Fed watchers pay attention to Reinhart because he has the distinction of being the last man who has come in from the cold, having left the Fed's marble temple last year for the private sector.

Reinhart worked at the Fed for twenty-five years, rising to become the top staffer on monetary policy.

In an interview with MarketWatch, Reinhart said the Bernanke Fed "clearly has to ease" on Wednesday. A half-point cut is the "most likely" action, but a quarter-point cut shouldn't be ruled out, he said.

Jane Fox : 1/29/2008 8:54:48 AM

LONDON (MarketWatch) - U.S. stock futures took a turn higher on Tuesday after an unexpected climb in durable-goods orders, though tech-darling VMware Corp. could be in for a tough session after its 80% revenue growth wasn't enough to satiate investor expectations.

S&P 500 futures rose 7.9 points to 1,362.50 and Nasdaq 100 futures rose 9.5 points to 1,819.75. Dow industrial futures rose 48 points.

A bleak report on new-home sales on Monday reignited speculation that the Federal Reserve will cut interest rates by a half-point this week, sending the Dow industrials up 176 points, the S&P 500 up 23 points and the Nasdaq Composite up 23 points.

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