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Keene Little : 4/15/2008 10:40:47 PM

Wednesday's pivot table: Link and Link

INTC closed its Jan 15th gap (at 22.69) in after hours (got as high as 22.77) and equity futures are up. Whether this turns into a real rally or instead a gap n crap Wednesday morning remains to be seen but the INTC pattern warns that a quick spike up on Wednesday could finish the rising wedge correction pattern that it's been in since the January low (daily chart: Link ).

Countering the potential bearish signal in INTC is what I see for the semiconductors. SMH left a bullish hammer at support and could spark another rally leg back up to the top of its flag pattern near $31 (and potentially higher as depicted in green): Link . This is a bearish pattern as well and could be getting ready to break down from here or after the next rally leg into May.

The broader market, as shown with this SPX 60-min chart, could give us an important signal as well on Wednesday: Link . A rally above 1340 that holds above would be bullish but a break below 1324 would be bearish. So far futures show that it will break above 1340. But again, watch out for a possible gap n crap which is an all-too-common occurrence following INTC's post-earnings after-hours rallies.

OI Technical Staff : 4/15/2008 9:59:59 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

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Jeff Bailey : 4/15/2008 9:15:20 PM

MM Profiles (underlying) ...

TSO $25.98 -1.55%
TOL $22.26 +2.25%
PM/MO $48.20 +0.41%/$21.71 +0.78
SWC $16.68 +2.14%
YRCW $13.32 -0.59%
BOOM $43.54 -0.18%

Jeff Bailey : 4/15/2008 9:10:31 PM

Semiconductor HOLDRs (SMH) $28.86 -0.13% ... last ticked $29.69 extended.

Jeff Bailey : 4/15/2008 8:59:32 PM

Intel 1Q profit meets forecast, revenue hits record ... AP Story Link

INTC $20.93 +1.15% ... last ticked $22.60 extended. WKLY Pivot $21.49. WKLY R1 $22.21. WKLY R2 $23.15.

Jeff Bailey : 4/15/2008 8:56:06 PM

Closing Internals found at this Link

Keene Little : 4/15/2008 4:35:54 PM

Equity futures have shot higher once they reopened. Now is when you need to exercise caution if you're thinking about the long side, which looks like the correct side. I don't know why but for some reason INTC causes the biggest head fake earnings reaction of just about any of the other big stocks. More often than not the after-hours reaction to INTC gets completely reversed the following morning and results in a trend day in the opposite direction.

I of course have no idea if that will happen tomorrow but that's the caution. I actually like the setup on the techs for a rally but I'm not so sure on the others and can't make a strong recommendation for tomorrow. Stay loose and don't make any assumptions without appropriate stop levels.

Keene Little : 4/15/2008 4:26:35 PM

In the rising wedge pattern that I showed earlier for INTC, the final leg (wave-e) is usually a throw-over and it's usually news related. That's why a spike up to close its gap at 22.69 could be a great setup to short the stock (just tagged 22.67 as I type). Link

Keene Little : 4/15/2008 4:22:36 PM

If INTC manages to tag 22.69 (gap close from Jan 15th) in after hours, and you feel brave, it could be worth a short play (gunslingers only who have money to burn).

Keene Little : 4/15/2008 4:17:44 PM

Looks like a positive reaction so far to INTC's earning's report--up a dollar and climbing.

Keene Little : 4/15/2008 4:11:54 PM

SMH did in fact finish with a hammer doji at support so it's a good setup for a rally tomorrow. Now all we need is for the bulls to prove their stuff tomorrow. Link

Jeff Bailey : 4/15/2008 4:06:16 PM

Washington Mutual (WM) $10.66 +2.99% ... gets active $10.74 extended on headline numbers.

Jane Fox : 4/15/2008 4:03:12 PM

Economic reports on the docket for tomorrow include.

8:30a.m. Mar Consumer Price Index. Previous: +0.2%.

8:30a.m. Mar CPI, Ex-Food And Energy. Previous: +0.2%.

8:30a.m. Mar Housing Starts. Expected: -6.5%. Previous: -0.6%.

8:30a.m. Mar Industrial Production. Expected: -0.1%. Previous: -0.5%.

8:30a.m. Mar Capacity Utilization. Expected: 80.4%. Previous: 80.9%.

2:00p.m. Federal Reserve's Beige Book.

Jeff Bailey : 4/15/2008 3:57:50 PM

I should qualify comments earlier regarding PBR looking too much like the $/yen. That was on a 5-minute interval. Nothing more. It looks NOTHING like the $/yen on 30-minute or 60-minute. If it did, the PMJ-DE would be $0.00.

Jeff Bailey : 4/15/2008 3:53:39 PM

XLF $24.61 +0.28% ... a "combo" of BIX.X, BKX.X and XBD.X

Jeff Bailey : 4/15/2008 3:52:19 PM

Listening to technician on CNBC regarding the importance of the BKX.X 75.97 +0.51% ... as it struggles at its 01/18/08 low.

Keene Little : 4/15/2008 3:48:15 PM

As I pointed out earlier, SPX could make it down to near 1306 if it gets a 5th wave down tomorrow. Possible support before that is the bottom of a parallel up-channel for price action since the March 17th low, currently near 1312 (which of course is also the March 28th low). But if the bulls can get a rally going and drive SPX above 1345 then there's a decent chance we'll see much higher by Friday. Tomorrow could be a telling day. 60-min chart update: Link

Jeff Bailey : 4/15/2008 3:43:41 PM

A couple of weeks ago I thought PBR might get right up here at the $125 strike, like it got down to the $95 strike into expiration.

Eating at me right now is th 3/20/08 exit at $1.40 and they would have gone "poof" had we held.

$160 bucks will still fill up the land yacht with diesel.

Jeff Bailey : 4/15/2008 3:37:58 PM

Swing trade call exit alert! ... for the Petroleo Brasileiro PBR April $125 Call (PMJ-DE) at the bid of $1.60.

PBR $123.21

Keene Little : 4/15/2008 3:34:36 PM

I mentioned we could get a 3-wave move up off this morning's low and two equal legs up for SPX would be at 1337.31, very close to the 38% retracement (of the Mar-Apr rally) at 1336.98. That's the level I'll be watching for a short play to set up (or not).

Linda Piazza : 4/15/2008 3:34:11 PM

Potential SPX resistance near 1334.50-1335.50 consists, in part, of the 23.6% retracement of the decline off last Thursday's high into today's new low. There's further potential resistance at 1337.02, the same resistance line that was earlier at 1337.29 and which I thought, at that time, that I wouldn't be surprised to see tested. This choppy market chops up expectations, too. For now, however, we're watching to see if that 23.6% retracement again stops the SPX.

Jeff Bailey : 4/15/2008 3:31:36 PM

PMD-DE $1.70 x $1.80

Jeff Bailey : 4/15/2008 3:30:58 PM

Should PBR go out here at $123.40, tomorrow's DAILY R2 would be $126.83.

$126.83 - 125 = $1.83

Linda Piazza : 4/15/2008 3:21:17 PM

If the SPX should end the day anywhere near its current 1329.47 level, it will have created another small-bodied candle that clings to the daily 30-sma (weekly, too, as it happens). What does this mean for tomorrow? As you know, this does not complete the reversal signal that was a potential for today, so we're positive about that. We can't be positive about much else, though, with this type of candle today.

The possibility exists that we'll see further consolidation tomorrow, but that's just not something that's easy to predict with any accuracy. Today's second day of consolidation means that bears and bulls are battling it out and they're about evenly matched for this moment. Anything--a bad earnings report here or in some company closely related to the U.S. economy, some big currency move, tomorrow morning's CPI in Germany or here in the U.S. or Housing Permits and Starts in the U.S.--could change that in a heartbeat.

While consolidation goes on, it's usually best to expect it to continue to go on, until it doesn't. That doesn't sound like a lot of help, does it, but it can be surprisingly helpful if you're thinking about initiating trades and you stay out until you see clear signs that the stalemate is broken. It's not so helpful if you're evaluating whether to hold overnight when something could happen to change that stalemate while you sleep.

Barring anything big that happens in the last 40 minutes of trading, you, unfortunately, must make your decision knowing that absolutely anything can happen tomorrow. Another choppy day is possible. The SPX is not so far from the middle of that big triangle on its daily chart. It could as easily tumble down as it could rise to the top. It's not only near the middle but it's in a congestion zone that's been building up within that triangle and near the bottom of support in that congestion zone, but not at the bottom. RSI is currently 39, not at the neutral 50, but not so far off it, either. RSI has plenty of room to run either direction as it tends to bottom out below 30 on the daily chart.

Jeff Bailey : 4/15/2008 3:15:53 PM

EIA: US Imports Of Venezuela Crude Fall 18.3% In Feb Vs. Jan
US Feb Imports Of Venezuela Crude Lowest Since Oct'05
Drop In US Venezuela Crude Imports Follows Exxon/Mobil Cutoff

Linda Piazza : 4/15/2008 3:08:23 PM

As expected the A/D line's resistance was strong. The A/D line has now fallen below and risen back to test the 15-minute 9-ema, with that now at about +230, and the A/D line at +231. The A/D line currently looks vulnerable to a further pullback to about +50, but in these markets, anything can happen. If it does pull back further, the SPX and OEX will likely be tugged back, too.

Keene Little : 4/15/2008 3:04:06 PM

In the expanding triangle pattern I showed on the SPX 30-min chart (2:16 PM), it would be reasonable to expect a 3-wave move up off this morning's low (maybe up to 1337, the 38% retracement level). That would mean the current pullback from the high near 2:30 PM could lead to another rally leg (all part of the whipsaw price action typically seen in these triangle patterns). In other words, don't make any trend assumptions with these moves. But a break to a new daily low would be more immediately bearish.

Jeff Bailey : 4/15/2008 3:02:33 PM

PBR looking a bit too much like $/yen 101.47

Jeff Bailey : 4/15/2008 3:01:42 PM

Swing trade call raise stop alert! ... for the PMJ-DE to $122.50.

PBR $122.83 +0.53% ... PMJ-DE $1.45 x $1.60.

Linda Piazza : 4/15/2008 2:55:25 PM

If the SPX can't pull up soon, it risks dropping to 1327.66. So much for my "I wouldn't be surprised" post. This resistance has proven stronger than it looked, but if I'd looked at the A/D line's chart first, I likely wouldn't have included that "I wouldn't be surprised" post about a bounce up toward 1337.29. The A/D line's 15-minute chart showed that resistance might be strong. Mea culpa.

Keene Little : 4/15/2008 2:52:09 PM

There's definitely a lot of similarity between the price patterns for oil and the euro, both of which look to be in a topping pattern. I view both of these as bearish setups and it's only a matter of time (and very little time) before they both break down (daily charts of the euro and oil): Link

Linda Piazza : 4/15/2008 2:34:20 PM

The A/D line is now dealing with potentially strong resistance now at about +500, with the A/D line at 370 as I type. If it gets past this resistance and can maintain levels above it, then it might charge up toward next resistance (trendline) at about +690 and then (Keltner) at about 952, but for now, that resistance looks relatively firm, which questions my whole "I wouldn't be surprised" 2:25:22 post.

Linda Piazza : 4/15/2008 2:32:01 PM

The SPX's 15-minute 9-ema is now 1330.15; the OEX's, 613.01.

Jeff Bailey : 4/15/2008 2:31:01 PM

Pound/$ MONTHLY Pivot is 1.998.

Jeff Bailey : 4/15/2008 2:30:36 PM

$/Yen MONTHLY Pivot is $99.86.

Jeff Bailey : 4/15/2008 2:30:10 PM

Eur/$ MONTHLY Pivot is 1.5612.

Jeff Bailey : 4/15/2008 2:28:28 PM

DXY 72.115 +0.33% (30-minute delayed) ... sitting juuuuuuuuust under its MONTHLY Pivot (72.15).

Linda Piazza : 4/15/2008 2:25:22 PM

Although it's not yet a probability but only a possibility, I wouldn't be surprised to see the SPX test 1337.29 if this pullback finds support at or above the 15-minute 9-ema now at 1330.22. If the SPX should climb to test or at least approach 1337.29, however, I'm not sure whether the SPX will get past that resistance level to test the next level of resistance now at 1340.78-1342. In fact, I'm not sure if the SPX would even stay at 1337.29 if it does test that level. It might instead be pushed back below 1334.50-1335.50. The problem with jumping on board a movement after times like the last few days is that you don't know when a movement has begun until it's already pretty far along the way. I thought since yesterday that the SPX was trying to steady but it didn't bounce until today and I'm not sure how far it will bounce. Remember that the SPX is still inside a big triangle shape on its daily chart, and we're seeing what results when that happens.

Jeff Bailey : 4/15/2008 2:22:56 PM

02:00 Internals found at this Link

Keene Little : 4/15/2008 2:16:21 PM

This SPX 30-min chart shows the possibility that we're in a 4th wave correction in the decline from April 7th: Link . Once it's complete, and the current leg up could be the last leg of it, a 5th wave down to a new low would be next. The downside target would likely be the 62% retracement of the Mar-Apr rally at 1306.55 from which we could get another bounce back up to the 1340 area.

The 4th wave correction could see a bounce all the way up to the 1340-1345 area as part of an expanding triangle (bull horn) consolidation pattern and it would not be until a break above 1345 would I feel more comfortable about the bullish prospects now. Until then stay cautious and trade very short term here.

Linda Piazza : 4/15/2008 2:04:13 PM

The SPX is closing this 15-minute period above the 45-ema, a feat that it could not accomplish this morning during the first 15-minute period of the day. It tested the 15-minute 45-ema during that period, too, when it was higher, and was knocked back. There's a small change in tenor, then, but we must consider that at the same time it was testing this average this morning, it was also testing the 23.6% retracement of its slide off last Thursday's high. It may instead have been that Fib level or the convergence of the two that held the SPX back. Readjusted now to take into effect today's new low, the 23.6% retracement is now at about 1334.50, with further Keltner resistance now near 1337.36. So, watch for potential resistance on 15-minute closes near 1334.50-1335.50 and then again near 1337.40.

Keene Little : 4/15/2008 2:02:51 PM

SMH is almost back to even for the day and so far has a bullish hammer doji at support. That one looks good for further upside if today can be followed by more upside tomorrow.

Jeff Bailey : 4/15/2008 2:01:46 PM

If memory serves ... the PMJ-DE did see a trade of $4.00 on the spike in volatility yesterday.

Jeff Bailey : 4/15/2008 2:00:26 PM

PBR's Daily R2 $133.19 and MONTHLY R2 $131.06 ... would be nice if we could get that out of the way today! Not sure, but give it the chance.

Keene Little : 4/15/2008 2:00:15 PM

I think we have ourselves a bonafide rally--the indices have rallied out the top of the up-channels off this morning's lows and that's clearly bullish. Maybe now we'll get our rally into the end of the week. But there is the possibility that a leg up here could finish a sideways consolidation from yesterday morning's low in which case it will lead to another decline. I'll work up a chart on that but be careful if long now--chase your stop up behind this.

Jeff Bailey : 4/15/2008 1:58:20 PM

PBR $123.71 +1.26% ... tries to challenge yesterday's high.

Jeff Bailey : 4/15/2008 1:56:27 PM

I was going to "defend" your long if it pulled back anywhere close to 12,294. $ too strong against the yen not to.

Jane Fox : 4/15/2008 1:52:42 PM

Tks Jeff. Seems the DOW is starting to behave again. Petulant little thing that it is.

Jeff Bailey : 4/15/2008 1:50:45 PM

$/Yen 101.70

Jeff Bailey : 4/15/2008 1:50:33 PM

Great trade Jane!

Jane Fox : 4/15/2008 1:48:59 PM

Out at target

Linda Piazza : 4/15/2008 1:37:26 PM

The potential next resistance on 15-minute closes for the SPX has now dropped to 1331.74. For the OEX, it's 613.74.

Jeff Bailey : 4/15/2008 1:30:57 PM

YM 12,316 (unch) at QCharts' Daily Pivot

Jeff Bailey : 4/15/2008 1:30:07 PM

$/yen 101.73 +0.63% ... DAILY Pivot $101.11, Daily R1 $101.92.

Jeff Bailey : 4/15/2008 1:28:51 PM

$/yen at best levels of the morning. Either it is "overdone," or YM has a lot of upside left.

Keene Little : 4/15/2008 1:26:09 PM

SPX is hitting the top of its potential bear flag pattern from this morning's low. If it can press higher than 1330 and hold it then it will be a bullish sign. 5-min chart: Link

Jane Fox : 4/15/2008 1:23:57 PM

Raise the stop to 12279.

Jane Fox : 4/15/2008 1:19:53 PM

Target is 12338.

Keene Little : 4/15/2008 1:18:45 PM

Keep an eye on the uptrend lines from this morning's lows. We could be just bear flagging on this bounce.

Jeff Bailey : 4/15/2008 1:18:22 PM

I tend to agree with CNBC reporter's report regarding current action in euro/$ and oil.

Still, until euro breaks 1.5782 to 1.5612, oil likely holds the bid into expiration.

Jane Fox : 4/15/2008 1:17:53 PM

Long YM from 12301 with a stop below 12264.

Jane Fox : 4/15/2008 1:09:07 PM

So not long yet.

Jane Fox : 4/15/2008 1:08:51 PM

I have left my YM long at 12301 and YM has now hit 12300.

Jeff Bailey : 4/15/2008 1:03:22 PM

TOL $21.86 +0.41% ...

Jeff Bailey : 4/15/2008 1:03:06 PM

DJUSHB 355.92 +0.07% ...

Jeff Bailey : 4/15/2008 1:02:46 PM

US NAHB April Housing Index 20 Vs. 20 In March

Jeff Bailey : 4/15/2008 12:59:08 PM

VIX.X 23.54 -1.17% ...

Jeff Bailey : 4/15/2008 12:58:43 PM

Swing trade call establish stop alert! ... for the one (1) Petroleo Brasileiro PBR April $125 Call (PMJ-DE) at $121.50.

PBR $122.24 +0.05% ... PMJ-DE are $1.45 x $1.55

Linda Piazza : 4/15/2008 12:46:27 PM

Watch for potentially strong Keltner resistance at 1332.28 on 15-minute closes for the SPX. For the OEX, the analogous level is 613.97 on 15-minute closes. I've been watching for the possibility that this Keltner line, tested this morning, might be exceeded, and this might be the time, but then indices will face other potential resistance levels. For now, have what-if plans for a test of these resistance levels mentioned above, with bull having profit-protecting plans in place in case there's another downturn from them, if tested. Bears should also have what-if plans in place in case that resistance is broken. Next potential resistance levels, if those are broken, are near the 23.6% retracement levels of the slide off last Thursday's low, at about 1335.90 for the SPX and about 617.44 for the OEX.

Linda Piazza : 4/15/2008 12:35:38 PM

In my 12:07:44 post, I noted that the A/D line needed to rise, probably within the next 30 minutes, at least to test the 15-minute 9-ema or it risked dropping through support instead. As I type, about 30 minutes later, the A/D line has just risen to test and press a little higher than its 15-minute 9-ema. The A/D line barely met that deadline, didn't it? The A/D line is now -87 and that 15-minute 9-ema is now about -120. Bulls want to see the A/D line maintain values above that 15-minute 9-ema.

Keene Little : 4/15/2008 12:33:09 PM

I was looking at INTC hoping it might provide some clues (especially with earnings coming up). Since SMH is playing at support it could be important what INTC does from here. The price pattern that it's been in since the January low is bearish. I have very little doubt that it will continue lower and easily break the January low near 18. The big question right now (in my mind) is whether INTC will start down from here (dark red) or if it has one more leg up into the end of the month first (pink): Link

The rising wedge pattern is a classic b-wave correction pattern and it points to a strong decline coming (wave (c) on the chart). But first, another leg up could get INTC closing its January 15th gap at 22.69 and would make for an outstanding short play setup. The bulls need to bounce INTC now but if they can't, and especially if it breaks below the 19.44 March 4th low, it'll be the bears running the show. Bulls need a hammer candlestick today.

Jeff Bailey : 4/15/2008 12:16:51 PM

12:00 Internals found at this Link

Jeff Bailey : 4/15/2008 12:11:54 PM

TRAN 4,833 (unch)

Jeff Bailey : 4/15/2008 12:11:34 PM

Airline Index (XAL.X) 23.70 -5.61% ... probes its -19.1% conventional. This is also the 3/17/08 52-week low.

Linda Piazza : 4/15/2008 12:07:44 PM

The A/D line isn't doing much over the last hour. It's been moving sideways just above potentially strong Keltner support, but it's not capitalizing on the support holding, which is a bit troublesome for equity bulls. The A/D line needs to rise soon, probably within the next 30 minutes or so, at least to test the 15-minute 9-ema now at about -107, if not to sustain values above it. Otherwise, it risks dropping through that support. The A/D line is at -245 as I type.

Keene Little : 4/15/2008 12:05:13 PM

BTW, Happy Tax Day! I wonder if some late filers waited until the last minute to cash in some of their holdings in order to pay their tax (hoping for a better rally before selling). Maybe tomorrow will see a tax-relief rally. Yea, that's it.

Linda Piazza : 4/15/2008 12:04:54 PM

The OEX has potential resistance near 611.76 and then at 614.17 on 15-minute closes.

Linda Piazza : 4/15/2008 12:04:01 PM

The SPX's potential support on 15-minute closes, now layering down to 1322.88, again appears to be strengthening. I'm not certain that will make any difference, but it's possible that we'll at least see another 15-minute 9-ema (1327.20) test and a tset of the 1332.72 next resistance can't be ruled out, either.

Keene Little : 4/15/2008 12:03:03 PM

With oil's rally today it has pushed up to the trend line along the highs since March 27th which I think is the top of a rising wedge pattern. This is shown on the USO daily chart: Link

I posted this chart yesterday and mentioned we could get a little throw-over above the top of the wedge and tag the top of the parallel up-channel from last summer, currently near 92. The significance of the wave pattern is that it could be an important top which will set up a large decline (one that will break below its up-channel so back below 75.

Linda Piazza : 4/15/2008 11:53:30 AM

If the SPX can get past and sustain values above its 15-minute 9-ema now at 1327.75, watch for next potential resistance on 15-minute closes at about 1332.25.

Jane Fox : 4/15/2008 11:45:58 AM

SAN FRANCISCO (MarketWatch) -- Crude-oil futures soared Tuesday to a new record of $113.93 a barrel, temporarily boosted by supply disruption in Mexico and Nigeria. A weaker dollar and lower inventories expectations also pushed prices up.

Jane Fox : 4/15/2008 11:45:13 AM

AD volume continues to make new daily lows as does the AD ratio. The VIX is hovering at daily highs.

Keene Little : 4/15/2008 11:44:43 AM

ES and YM have not closed their gaps yet. For the cash indices, SPX and DOW would close their gaps at 1322.72 and 12256.95, so about 1.7 and 17 points lower. Bullish divergences on the 30 and 60-min charts persist, even at today's new low.

Jane Fox : 4/15/2008 11:35:53 AM

YM made new daily lows but that push down was enough to throw it into an oversold state. I would like to take advantage of it and try a long YM at 12301. The stop will have to be below daily lows so this trade will have a wide profile.

Jeff Bailey : 4/15/2008 11:33:56 AM

Those WHR-PP are now $1.45 x $1.60. Exited on 4/11/08 at $0.80 as WHR traded $82.89.

When I felt we should exit, was "running the math" to that 61.8% retracement of $78.99. ($80 - $78.99) = $1.01.

Jeff Bailey : 4/15/2008 11:31:06 AM

Whirlpool (WHR) $79.97 -1.44% ... slips under the $80.00 strike.

Linda Piazza : 4/15/2008 11:26:35 AM

Despite a stronger-looking setup on the SPX's 15-minute chart, it's sinking into a potential support zone rather than immediately bouncing from it. That potential support zone now extends down to 1323.66 on 15-minute closes. The A/D line has to bounce before we can believe in any bounce in the equities, though.

Jeff Bailey : 4/15/2008 11:25:11 AM

YRCW $13.40 (unch) ... yesterday's high was just above WKLY Pivot ($13.74), but no try today.

Linda Piazza : 4/15/2008 11:24:50 AM

The OEX is dipping into that potential support zone mentioned in my 10:48:57 post. I hadn't been sure if the OEX would fall into that zone, but it certainly is. That potential support was then extending down to 610.46, but is now lower, at 609.92-610.70.

Jeff Bailey : 4/15/2008 11:24:06 AM

Dow Transports (TRAN) 4,843 +0.21% ... holds a fractional gain. Morning high stalled at its WKLY Pivot.

Linda Piazza : 4/15/2008 11:22:56 AM

The A/D line is now -251, dipping into that next potential support zone. That potential support currently extends down to about -350 on 15-minute closes.

Jane Fox : 4/15/2008 11:18:31 AM

Once the VIX joined the bear's camp it has been in full support. Link

Linda Piazza : 4/15/2008 11:14:44 AM

The A/D line still drops. If it doesn't steady near its current -34 level, it threatens to drop to -235 to -345.

Jeff Bailey : 4/15/2008 11:13:56 AM

Beckman Coulter (BEC) $61.96 -1.36% ... listed as a competitor of AFFX

Jeff Bailey : 4/15/2008 11:13:18 AM

Applera Corp. (ABI) $28.88 -6.68% ... listed as a competitor of AFFX

Jeff Bailey : 4/15/2008 11:11:28 AM

Biotechnology Index (BTK.X) 747.08 -2.42% ...

Jeff Bailey : 4/15/2008 11:10:53 AM

Affymetrix Cuts Full-Year Revenue Forecast ... AP Story Link

Jeff Bailey : 4/15/2008 11:10:00 AM

Affymetrix (AFFX) $10.29 -36.98% ... #7 most active.

Jane Fox : 4/15/2008 11:07:20 AM

I see a YM long at 12343. The stop will be 12309 and target 12343 - 12309 = 34. 12343 + 34 = 12377.

Jeff Bailey : 4/15/2008 11:06:14 AM

Tesoro (TSO) $25.49 -3.41% ... new 52-week low here.

Nearing "Book Value" of $22.27.

Keene Little : 4/15/2008 10:57:55 AM

Interestingly the small caps (RUT) are holding up relatively well today as compared to the techs.

Keene Little : 4/15/2008 10:55:45 AM

Gap closures for ES and YM are at 1321.75 and 12259, resp. That's about 5 and 50 points lower for ES and YM.

Jane Fox : 4/15/2008 10:54:02 AM

I am also considering the S&P futures (ES) on a 610 or 987 tick chart but I don't like trading ES. You get bad fills and sometimes are not filled at all. It can be a lousy market to daytrade and is why I am looking at it on the longer timeframe which is almost swing trading.

Keene Little : 4/15/2008 10:53:51 AM

NQ looks to be heading for gap closure at the March 31st closing price of 1784.75 (1.75 points lower than this morning's low so far). Watch for a bounce from there.

Jane Fox : 4/15/2008 10:52:12 AM

I have gone back to trading the DOW futures (YM) on the 377 tick chart. This market and timeframe struggled during March and, after doing extensive backtesting, switched to the Russell 2000 (ER2) futures on the 233 tick chart but continued to follow the YM because I knew it would make a comeback. I see now the YM is starting to make that comeback so I will resume profiling the trades here in the monitor.

Jeff Bailey : 4/15/2008 10:51:26 AM

Loan Originations Seen Slumping 20% To 40% This Year

DJ- The fallout from the subprime-led credit crunch is expected to result in less lending through 2009, a new report says, as loan originations this year are seen falling 20% to 40%.

In addition, a near-term recovery among housing or its loans isn't likely until at least next year as default and foreclosure rates continue to rise.

The findings from Celent, a financial research firm part of Marsh & McLennan Cos. (MMC), sees originations of $1.4 trillion to $1.9 trillion in 2008 as lenders continue tightening the screws on who gets money and how much.

The report, in particular, says "many lenders will severely restrict" loan making to their retail outlets, further squeezing the third-party makers of loans who get their funding from banks. Such lenders aren't expected to "stage a comeback" until late 2009.

Celent also anticipates the carnage to result in further consolidation in the financial services space, with stronger firms buying the loan porfolios of the weak.

Meanwhile, subprime originations aren't seen exceeding $200 billion until 2011; by comparison such lending topped $500 billion annually from 2004 through 2006. As such, lenders will be competing for borrowers with higher credit scores, meaning those "prime" customers will benefit from lower interest rates.

"With intense competition in the prime market, lenders will be well-served to consider the opportunities in subprime, where decreased competition would allow more lenders to reap the rewards of intelligent risk assessment," said Celent.

It added subprime borrowers make up one-quarter to one-third of the U.S. loan-origination market "and remain a market that needs to be served."

The report found that the top 15 subprime lenders commanded a 38% market share in 1996, rising to 62% in 2001 and hitting 76% by 2006. Subprime originations surged from $138 billion in 2000 to $600 billion in 2006.

Linda Piazza : 4/15/2008 10:48:57 AM

The OEX is clinging to support from a descending Keltner line now at about 612.50, not moving far above or below it. Next potential Keltner support can be found at 610.46, but I'm not sure the OEX will get there. Bears should factor in the possibility that the OEX might be trying to steady again and might attempt a bounce, but that remains to be seen.

Jeff Bailey : 4/15/2008 10:48:22 AM


DJ- Wachovia's controversial Pick-a-Payment mortgage program lets borrowers choose between four monthly payment amounts. But, these 'Pick-a-Pay' borrowers are increasingly inventing a fifth choice: Not making mortgage payments at all.

WB $25.41 -0.54% ...

Jeff Bailey : 4/15/2008 10:47:02 AM


DJ- U.K. oil and gas giant says that it is aware that a Chinese fund has built up a pound 1 billion stake in the company and welcomes the investment, with the U.K. government saying it is happy with any such investment if it is transparent and fair.

BP $64.95 -1.00% ...

Linda Piazza : 4/15/2008 10:46:59 AM

The SPX did not, of course, find support at its 15-minute 9-ema on that last 15-minute close and it looks as if this 15-minute close will be below that moving average, too. Next support, which looks rather firm, layers from 1324.97-1327.43. On a Keltner basis, the SPX looks stronger right now than it did when it was approaching these levels yesterday. We'll have to wait a bit to see if that means anything, though, but bears should consider the possibility that this support will hold and prompt a bounce attempt, at least.

Keene Little : 4/15/2008 10:45:24 AM

GOOG has broken below yesterday's low, as has NDX, and that's not a good sign for the broader market.

Jeff Bailey : 4/15/2008 10:45:22 AM


DJ- Bank's net falls 33% to $146.2 million, or 56c a share, on surging loss provisions, despite a large gain from Visa's IPO. Revenue climbs 16% to $648.7 million. Analysts expected EPS of 52c on revenue of $608 million.

MI $21.79 +0.83% ...

Jeff Bailey : 4/15/2008 10:44:22 AM


DJ- M&T Bank's 1Q net income rises to $202.2 million, or $1.82 a share, as a huge gain related to the initial public offering of Visa helps offset a doubling of the company's credit-loss provision. Revenue climbs 32% to $731.5 million.

MTB $83.04 +2.83% ...

Jeff Bailey : 4/15/2008 10:40:22 AM


DJ- Regions Financial posts a 1.1% rise in 1Q net income to $336.7 million, or 48c a share, helped by year-earlier losses from discontinued operations, as the bank's credit quality continues to worsen. Revenue rises 3.3% to $1.93 billion.

RF $19.72 +6.25% ...

Linda Piazza : 4/15/2008 10:40:14 AM

The A/D line has now hit its 15-minute 9-ema, now at about +106. Equity bulls want that to hold as support. The A/D line is currently bouncing from that and is +288 as I type. Watch now for potential resistance at +750 to +960 if the A/D line should continue to bounce.

Jeff Bailey : 4/15/2008 10:38:56 AM


DJ- Financial-services firm files its delayed 1Q report, posting earnings of 86c a share on revenue of $3.4 billion. Bear also reports it received a Wells Notice from the SEC and information demands from the FTC.

BSC $10.00 -1.08% ...

JPM $41.77 +0.65% ...

Linda Piazza : 4/15/2008 10:37:57 AM

And this is why I watch the A/D line on a Keltner chart. What else was going to tell you at 9:39 that although the A/D line was at +1198 at the time, that it might end up below about +890 by the end of that 15-minute period and that, if that happened, the possibility of a pop-and-drop day existed? This isn't perfect at predicting what's going to happen, but it certainly gives me a way to assess the A/D line's action. As I've mentioned before, I once attempted trading a system that entered trades based solely on what the A/D line was doing. I didn't even look at SPX prices other than to decide which option would give me a high-enough delta to benefit from the move I expected to happen. That system resulted in a phenomenol number of profitable trades in a row, but profits were sometimes small, and losses, because they were keyed to A/D action and not SPX price, were sometimes too large. A bunch of small wins, even a bunch in a row, can't make up for too-large losses, even if infrequent. It wasn't a workable system for trading, but if I were still day-trading, which I'm not at present, I wouldn't trade without watching the A/D line. Day traders have enough going against them, which is why I switched to combination trades such as condors, butterflies, etc., and they need all the help they can get. Watching the A/D line using typical technical analysis tools, whatever those are for you, can give day traders an edge in my opinion.

For those who are interested, I've been doing a series of Trader's Corner articles on how I use the A/D line on nested Keltner channels. I finished it last weekend, but you can find a link to the other articles in last weekend's Trader's Corner.

Jeff Bailey : 4/15/2008 10:37:44 AM

JC Penney (JCP) $39.21 +1.29% ...

Jeff Bailey : 4/15/2008 10:37:21 AM

Sears Holdings (SHLD) $100.55 -0.86% ...

Jeff Bailey : 4/15/2008 10:36:57 AM

Target (TGT) $52.04 +0.15% ...

Jeff Bailey : 4/15/2008 10:36:31 AM

Wal-Mart (WMT) $55.70 +0.99% ... that's a new 52-weeker.

Jeff Bailey : 4/15/2008 10:35:53 AM

Retail HOLDRs (RTH) $92.10 +0.19% ...

Jeff Bailey : 4/15/2008 10:35:24 AM

S&P Retail Index (RLX.X) 387.21 -0.16% ...

Jeff Bailey : 4/15/2008 10:34:58 AM


DJ- U.S. chain store sales fall 1.2% in the first week of April compared with the previous month, according to Redbook Research, which expected a 1.4% decline. Separately, the ICSC-UBS Retail Chain Store Sales Index rises by 0.9% in the week to April 12.

Jeff Bailey : 4/15/2008 10:34:20 AM

Petroleo Brasileiro (PBR) $121.69 -0.40% ...

Jeff Bailey : 4/15/2008 10:33:49 AM

USO $90.93 +1.43% ...

Jeff Bailey : 4/15/2008 10:33:29 AM


DJ- Russian oil production, for years a key source of world supplies, is showing signs of a slump, adding to uncertainties that have helped push prices to record highs.

Jeff Bailey : 4/15/2008 10:32:39 AM


DJ- Financial-services firm posts net income of $530 million, or $1.35 a share, as revenue jumps 52% to $2.58 billion, helped by its purchase of Investors Financial Services. Analysts expected EPS of $1.30.

STT $71.29 -7.29% ..

Jane Fox : 4/15/2008 10:33:35 AM

So this was one of those days when the VIX follows the ES (S&P futures), not the other way around which it usually does. The VIX is now making new daily highs supporting the bearishness.

Jeff Bailey : 4/15/2008 10:31:33 AM


DJ- Bank's net falls to $1.09 billion, or 62c a share, which includes a $492 million gain related to the Visa IPO and a $253 million impairment charge. Its credit-loss provision rises to $485 million. Analysts expected EPS of 61c.

USB $31.25 -1.42% ... reverses gains from $32.70.

Jeff Bailey : 4/15/2008 10:30:20 AM

Ameritrade (AMTD) $16.59 +0.24% ...

Jeff Bailey : 4/15/2008 10:29:50 AM


DJ- Discount broker reports net income of $305 million, or 26c cents a share, as a sharp increase in net new clients helps push revenue up 14% to $1.31 billion. Results are in line with analysts' projections.

SCHW $19.21 +4.91% ...

Jeff Bailey : 4/15/2008 10:28:05 AM


DJ- Bank is letting the private-equity firms bidding for up to $12 billion of its leveraged loans cherry pick from a wide range of assets with different prices and credit ratings, the Financial Times reports.

C $22.53 +0.08% ...

Keene Little : 4/15/2008 10:28:03 AM

If you want to trade GOOG, at this point a break below 450 would be bearish and above 460 would be bullish (just be careful of another failed test of its broken uptrend line.

Jeff Bailey : 4/15/2008 10:26:57 AM


DJ- Creditors led by JPMorgan Chase are allowing Jefferson County, Ala., to delay making a $53 million bond payment due today, Bloomberg News reports. Failure to negotiate a rescue plan could result in the largest municipal debt default ever.

Linda Piazza : 4/15/2008 10:26:15 AM

A/D line currently 423. The 15-minute 9-ema is now 138 but is rising beneath the A/D line. A drop toward 138 may still occur, but the A/D line appears to be attempting to steady. If it bounces now or does so after a test of the 138 zone, watch now for rollover potential from about +750 to +950. If the A/D line drops much deeper than +138, perhaps to -140 to -390, as is possible, then we'll have a pop-and-drop day on our hands and will have to reassess where next resistance might be.

Jeff Bailey : 4/15/2008 10:26:10 AM


DJ- Singapore state investment firm Temasek buys 12.5 million shares at $48 each under an option granted by Merrill Lynch. Price is 12% greater than yesterday's closing price and comes after Temasek bought $4.4 billion in shares late last year.

MER $42.31 -1.32% ...

Jeff Bailey : 4/15/2008 10:25:05 AM


DJ- Footwear designer's shares plunge 39% after it lowers its 1Q and 2008 full-year sales and per-share earnings forecast and its board approves the repurchase of 5 million shares.

CROX $10.75 -39.68% ...

Keene Little : 4/15/2008 10:24:28 AM

Yesterday I showed the bear flag pattern for GOOG ( Link ) and mentioned it's make or break time for bulls. Price had broken marginally below the bottom of the flag (the uptrend line from March 17th) and this morning it bounced back up to it, gave it a peck on the cheek and dropped back down (60-min chart): Link . That's bearish if GOOG now drops below yesterday's low. I'm watching GOOG as our canary.

Jeff Bailey : 4/15/2008 10:24:00 AM

30-year Yield ($TYX.X) up 5.1 bp at 4.392% ...

iShares Lehman 20yr (TLT) $94.40 -0.74% ... -1.55% for Q2. +1.48% YTD

Jeff Bailey : 4/15/2008 10:21:59 AM


DJ- Net foreign acquisition of long-maturity U.S. securities totals $60.1 billion in February, following purchases of $42.2 billion the month before. Excluding such non-market flows, TIC records net buying of $72.5 billion in long-term U.S. securities.

Jeff Bailey : 4/15/2008 10:20:55 AM


DJ- Foreclosure filings for March rocket 57% from a year earlier to 234,685 filings, or one for every 538 U.S. households. Figure is a 5% gain from February, and it suggests that U.S. housing woes have yet to slacken.

Jeff Bailey : 4/15/2008 10:20:16 AM


DJ- Empire State's general business conditions index nudges into positive territory in April, at 0.63, one month after plunging to a record low. Economists expected the index to remain weak at -16.8. New orders also turn positive, with the index at 0.06.

Jeff Bailey : 4/15/2008 10:19:38 AM


DJ- Consumer-products maker posts net income of $3.59 billion, or $1.26 a share. Analysts expected earnings of $1.20 a share. Sales increase 7% to $16.2 billion. Firm raises 2008 view to $4.40 to $4.45 a share; Wall Street sees $4.44.

JNJ $65.53 -0.31% ...

Jeff Bailey : 4/15/2008 10:18:51 AM


DJ- The producer price index for finished goods rises 1.1% after a 0.3% increase in February. The core index, which excludes food and energy items, climbs 0.2% last month after rising 0.5% in February. Economists called for a 0.6% increase in the overall index and a 0.2% increase in the core index.

Jeff Bailey : 4/15/2008 10:18:13 AM


DJ- Shares of Delta decline 9% and Northwest stumbles 4% after the carriers agree to merge in a deal that would create the world's largest airline by traffic, if the agreement can pass regulatory muster and potential employee resistance. If they do merge, analysts are skeptical about how much they can save on synergies and the ability of such a global force to weather fuel-price pressures and an economic downturn.

DAL $9.46 -9.73%

NWA $10.74 -4.27% ...

Jeff Bailey : 4/15/2008 10:15:42 AM

10:00 Internals found at this Link

Jane Fox : 4/15/2008 10:15:33 AM

Of course the market needed to make a new daily low before it moved upward but I still think the highest probability is for a move upward or at least no follow through on the downside.

Linda Piazza : 4/15/2008 10:11:50 AM

A/D line now 490, dropping deeper after testing the Keltner resistance this morning and falling back from it. First potential support has now risen to +72 to +178, and equity bulls would like to see that hold. If not, deeper support near -178 and ranging down to -440 could be tested.

Linda Piazza : 4/15/2008 10:10:27 AM

The SPX's 15-minute 9-ema has now risen to 1331.22 and may provide support on 15-minute closes. At least that's what equity bulls hope happens. The OEX's version is near 613 and is joined by stronger potential support. Equity bulls definitely want that to hold on 15-minute closes. Otherwise a retest of the 610-611 level is suggested.

Jane Fox : 4/15/2008 10:06:22 AM

S&P futures are making new daily lows but the VIX is not making new daily highs so I would not be short here. I think we are in for a move upwards.

Linda Piazza : 4/15/2008 10:00:41 AM

The A/D line is dropping back below the trendline mentioned and shown previously and is also dropping further beneath the Keltner resistance. This is not what equity bulls want to see. The violation is not severe yet, either in terms of how far the drop has carried the A/D line (to 650 as I type) or the length of time the drop has persisted, but if it goes on too long, a drop toward +70 to -390 would have to be considered a possible target. Not quite yet, though, I don't think, but this is a subjective impression. I still think the possibility of a deeper equity pullback must be at least factored into trading plans if not yet counted as a probability.

Linda Piazza : 4/15/2008 9:56:54 AM

The SPX hit that resistance (Keltner, Fib) mentioned in my 9:30:44 post and pulled back, as the A/D line was also hitting resistance and pulling back. So far, the pullback isn't alarming, but equity bulls would prefer sideways consolidation now to any further pullbacks as deeper or more prolonged pullbacks heighten the possibility of a pop-and-drop day. So far, it's not looking like that yet, but the possibility exists and should be factored into trading plans. The SPX's 15-minute 9-ema is now 1331.16. For the OEX, it's near 613.

Keene Little : 4/15/2008 9:52:48 AM

Semiconductors are diving this morning, SMH down -1.1% here. That's not going to be helpful to techs which could end up being a drag on the rest of the market. But SMH is now down to the bottom of its flag pattern and the top of its broken down-channel (near 28.50) so there's potential support here: Link

Linda Piazza : 4/15/2008 9:51:15 AM

The A/D line did pull back, as I anticipated, and it also pulled back below the Keltner resistance. It's just above the descending trendline I mentioned earlier. Equity bulls don't want to see it fall much further. Here's a chart: Link

Keene Little : 4/15/2008 9:42:31 AM

The bullish divergence at yesterday afternoon's low was a warning that the selling momentum was clearly waning. Now we've got a gap up and the question this morning is whether it will get filled or not. That's the risk for longs at the moment--a stop needs to be below yesterday's low.

Linda Piazza : 4/15/2008 9:39:24 AM

Keltner Outlook on the A/D Line: The A/D line jumped straight up to potentially strong resistance at about +890 this morning. It also jumped above a descending trendline off the 4/7 high, with that trendline now crossing at about +800. Thus, there's a breakout attempt, but this also shows that the A/D line is in a precarious and unsupported spot, and I'm always watchful for a pop-and-drop day when this happens first thing in the morning. So far, there's no sign of that, but the possibility exists. While we probably should or will see the breakout level retested, equity bulls don't want to see the A/D line sustain values below about +800. The A/D line is 1198 as I type, still climbing.

Jane Fox : 4/15/2008 9:39:13 AM

AD line opens on the bulls side at +720 and has climbed now to +1052 so the bulls have the ball.

Linda Piazza : 4/15/2008 9:30:44 AM

All day yesterday, I kept operating under the thought that market participants were trying to steady the markets. They certainly didn't capitalize on any such efforts yesterday, did they? Today, there may be an attempt to do just that, but let's consider it an attempt for now, so that you bulls among our subscribers should remain on your toes.

Futures were about seven and a half points above fair value this morning. If the cash market moves up in accordance, which it doesn't always do, it will be facing potential Keltner resistance now at 1335.20 on 15-minute closes. It will also be facing the 23.6% retracement of the slide off last Thursday's high, with that at about 1336.25. Watch for potentially strong resistance in that zone.

Keene Little : 4/15/2008 9:27:51 AM

Higher inflation shouldn't be good for stocks especially since it may force the Fed at least to the sidelines. But from a short term perspective it could be that bonds are selling off on the news (and they did) which frees up cash which rotates into stocks. So voila, we have a rally to start the day. I think there's a good chance for a rally into the end of the week so don't fight it.

Jane Fox : 4/15/2008 9:11:03 AM

Crude hit a new all time high at 113.66. Link

Jane Fox : 4/15/2008 9:10:06 AM

I suspect Gold will break through resistance at 940-960 sometime this week. I am long GLD in anticipation of that break. Link

Jane Fox : 4/15/2008 9:08:30 AM

Yesterday's range has pretty well contained the overnight trading so what we have is a consolidation that is almost 2 days old. I certainly hope we break out of it today and get some kind of range for daytrading.

I suspect the AD line will open neutral. Link

Jane Fox : 4/15/2008 9:01:16 AM

Dateline WSJ -Delta Air Lines Inc. and Northwest Airlines Corp., after three months of twists and turns, agreed to merge in a deal that would create the world's largest airline by traffic -- if the agreement can pass regulatory muster and overcome potentially serious employee resistance.

The transaction is expected to unleash a wave of consolidation as U.S. carriers try to bulk up through mergers to endure deteriorating industry conditions caused by record fuel prices, the weakening economy and the credit crunch. The thinking is that fewer, larger airlines will enjoy better pricing power, be able to cut marginal routes and seats, and expand their international reach to attract high-yielding business travelers and increase revenue. In theory, consolidation also would help domestic carriers vie with deep-pocketed foreign carriers that have expanded rapidly with new aircraft.

UAL Corp.'s United Airlines, a longtime proponent of consolidation, is expected to try again to interest Continental Airlines Inc. in a deal. Northwest's signature on a Delta merger document will allow Continental to redeem a "golden share" Northwest holds in Continental, thus erasing Northwest's ability to use that preferred stock to block Continental from combining with another carrier.

As expected, the Delta-Northwest merger would be an all-stock transaction in which Northwest shareholders will receive 1.25 shares in the new company for each Northwest share they own, the companies said. That equates to a 17% premium to Northwest shareholders based on Monday's closing share prices.

Jane Fox : 4/15/2008 8:54:20 AM

WASHINGTON (MarketWatch) -- Exceeding analysts' expectations, U.S. producer prices rose 1.1% in March, the Labor Department reported Tuesday, while analysts surveyed by MarketWatch had expected a gain of 0.4%.

Core producer prices, excluding volatile food and energy, rose 0.2% -- matching analysts' expectations.

In February, the PPI rose 0.3%, while the core gained 0.5%. Analysts have been concerned by gains in the core PPI and inflation risks. A slowdown in core inflation could signal to the Federal Reserve that it has more wiggle room to cut rates.

The Fed will be watching the consumer price index carefully for signs that inflation is heating up. The CPI, which measures retail prices, will be released Wednesday.

Over the last 12 months, producer prices at the wholesale level have gained 6.9%. Minus food and energy, those prices have climbed 2.7% -- the largest year-over-year gain since July 2005.

Jane Fox : 4/15/2008 8:52:20 AM

AMMAN, Jordan (MarketWatch) -- Encouraged by stronger orders and shipments, manufacturers in New York state were once again positive about the economy in April, the New York Federal Reserve Bank reported Tuesday.

The Empire State index jumped by nearly 23 points in April to 0.6 from negative 22.2 in March. Readings over zero indicate more firms are optimistic than are pessimistic. The index had been negative for two straight months.

In April, the percentage of firms reporting better conditions rose to 27% from 19%, while the percentage reporting worsening conditions fell to 26% from 41%.

The one-month increase in the Empire State survey was the largest since May 2003, when U.S. firms breathed a sigh of relief following the capture of Baghdad without major damage to oil facilities.

The shipments index also rose by 23 points, to 17.5 from negative 5.2. The new-orders index climbed into positive territory at 0.1 from negative 4.7 in March.

The prices-paid index rose to 57.3 from 50.6, the highest since the post-Katrina gasoline spike in late 2005. At the same time, the prices-received index -- an indication of pricing power -- rose by 5 points to 20.8%, the highest in five years.

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