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Keene Little : 5/15/2008 11:49:53 PM

Friday's pivot tables: Link and Link

The choppy price rise continues and the price pattern is very difficult to decipher except to say we're in an uptrend, as measured by the uptrend line from March, and as long as that is true we should be looking to buy dips to support. I've been attempting to figure out where the top of the run will be because, well, that's what I do. There hasn't been much change to the daily chart--the new high on Thursday obviously busted the nice short play setup that I thought would be a winner. Life in the fast lane. Daily SPX: Link

SPX stopped just short of the 200-dma, at 1427.76, so that's the first bell to ring on Friday. If the bulls can keep pumping air into this thing then the next upside target is 1447-1448 where it would close its gap from January 4th and tag its broken uptrend line from October 2002. The 60-min chart shows two levels of importance below the 1448 level: Link

The move up from March has become difficult to count from an EW perspective and that makes it more difficult to make Fib projections but my best guess shows an a-b-c count that I think could be playing out from May 1st. Today it tagged the level where equality in that move was at 1423.57 (just above the 62% retracement of the October-January decline at 1423.07).

Next up is near 1434 which correlates with an internal uptrend line that previous highs stopped at, and that line crosses 1434 at the end of day on Friday. After that is the 1448 Fib projection which crosses the broken uptrend line from 2002 next Tuesday May 20th.

OI Technical Staff : 5/15/2008 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The Market Monitor has been archived.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 : 5/15/2008 4:27:22 PM

OIH has to get today's volatility award. Jumped to 208, then plunged to 203, then ramped to close 209.10 +3.26% ...

Keene Little : 5/15/2008 4:21:03 PM

If the DOW can push a little higher tomorrow (with SPX as it tries for its 200-dma), the broken uptrend line along the lows since April 22nd, where the rally stopped yesterday, is currently near 13026 and almost a retest of the high on May 6th at 13046. That will be a resistance zone I'll be watching carefully tomorrow. 60-min chart: Link

Jeff Bailey : 5/15/2008 4:21:36 PM

Whew! What a day ... what a week!

Jeff Bailey : 5/15/2008 4:22:14 PM

Interesting, interesting comments from CNBC regarding VIX.X action and "complacency."

Question is ... who is, or has been complacent into Op-Ex?

VIX.X 16.30 -7.70% ...

SPY $142.53 +1.25% ...

and SPY "Max Pain" Theory to start the week at $139.00.

Keene Little : 5/15/2008 4:05:29 PM

Linda, don't beat yourself up (3:56). It's opex and I don't call it opex shenanigans for nothing. Yesterday's short play setup was about as sweet as one could ask. In hindsight it was too sweet (and therefore too obvious which always worries me). We make our call, we trade it (or not), and we place our stops. Some times the market just doesn't listen to us (wink).

Jeff Bailey : 5/15/2008 4:02:24 PM

Evergreen Solar (ESLR) $9.31 +0.43% ...

Keene Little : 5/15/2008 4:01:47 PM

SPX high is 1424 and it looks like some sellers stepped in early. Maybe it will make it 3.75 points higher tomorrow to tag its 200-dma.

Jeff Bailey : 5/15/2008 4:00:39 PM

Solar Fun (SOLF) $18.53 +6.43% ...

Linda Piazza : 5/15/2008 3:56:24 PM

Barring a big move down in the last few minutes of trading, my scenarios for the day were wrong. Those scenarios were based on various evidence such as yesterday's potential reversal signal on the daily chart, produced in the context of a confirmed reversal signal on the weekly chart. In addition, several intraday charts presented evidence that today was likely to be a consolidation day. This all came in the context of an opex day, one that I warned early could undo all evidence that I was seeing. All day, I warned that setups could not be trusted.

However, something is going on that's clearly rendering either the chart characteristics misleading, although they seem pretty clear to me; my interpretation of them wrong; or the markets are just getting jammed higher and will soon reverse. Perhaps we're seeing a reversal into better times after all, although people whose experience is far greater than mine and whose judgments I trust tend to remain skeptical, too. Whatever the reason, I'm certainly going to remain aware that my own judgment of what's most likely doesn't seem to be in tune with the markets, and I urge you to remain aware of that fact, too. I'm usually not so far off.

Jeff Bailey : 5/15/2008 3:54:01 PM

SPX 1,423.97 +1.08% ...

Jeff Bailey : 5/15/2008 3:52:19 PM

VIX.X 16.31 -7.64%

Jeff Bailey : 5/15/2008 3:52:03 PM

Sudden "shift" in up/down tick on the SPX 1,425

Jane Fox : 5/15/2008 3:51:21 PM

Very good chance the SPX will close above the 1420 resistance today and if it does the next stop could be 1470. Of course there will be a lot of pain in between, the market never does anything without a lot of pain. Link

Jeff Bailey : 5/15/2008 3:51:15 PM

Since 03/31/08 close ... QQQQ +14.25%, IWM +8.71%, SPY +7.94%, DIA +6.23%

Keene Little : 5/15/2008 3:50:51 PM

SPX 1425 would be a logical settlement price for tomorrow morning. Multiples of 25 is where the highest OI tends to be found.

Linda Piazza : 5/15/2008 3:49:25 PM

The upside target predicted by the 7-minute Keltner chart is now 1424.43.

Keene Little : 5/15/2008 3:49:03 PM

I'm a little surprised NDX and RUT aren't out in front in today's rally. NDX is now just pressing to a new high above yesterday's but RUT is lagging in that respect. At this point I have to assume, since the bearish setup from yesterday has been busted, that NDX could head for gap closure (Jan 4th) up near 2052.

Jeff Bailey : 5/15/2008 3:48:27 PM

VIX.X alert!

Jeff Bailey : 5/15/2008 3:44:50 PM

Just checked May'08 and Aug'08 CME housing and they don't seem to reveal anything different near-term from TOL's update into earnings. Wrote a CC on this one, and will call it a wash for now. Will be bullish, but look to roll out expiration.

Linda Piazza : 5/15/2008 3:44:05 PM

New high for the SPX, but not yet for the OEX. Oops, there it went as I typed. The OEX is still playing follower and not leader today.

Jeff Bailey : 5/15/2008 3:43:16 PM

Swing trade call exit alert! ... for the one (1) Toll Brothers TOL Jun $25 Call (TEP-FE) at the bid of $1.45

TOL $24.80 +4.46% ...

Keene Little : 5/15/2008 3:43:08 PM

And there goes SPX over yesterday's high. Next resistance is 1423 and then 1427.75.

Keene Little : 5/15/2008 3:42:03 PM

The a-d line shot right back up and reversed the last 10-min candle just as the buy program hit the indices. Definitely trying to hold it up into the close. Whether that will carry over into tomorrow is the question. NDX is now less than two points from yesterday's high so that will likely break.

Linda Piazza : 5/15/2008 3:39:53 PM

No sign of bulls giving up yet. The next potential turning point is the market-on-close orders at 3:40 pm ET. I'm seeing the SPX march up the 7-minute 9-ema, finding support on that moving average now at 1417.59 on 7-minute closes. Until that changes, it's persisting in the same pattern that it's had for the last several hours. I might think that the 30-minute pattern, the particular way that it's testing the resistance there and the type of candles that result might not look like the strongest type of climb, but that's certainly not preventing the SPX from climbing, is it? And here comes the retest of yesterday's high.

Keene Little : 5/15/2008 3:37:14 PM

The a-d line has turned down a little more sharply than all day in the last 10 minutes so that could be a heads up for the final 30 minutes.

Keene Little : 5/15/2008 3:34:07 PM

Still looks like distribution to me--small selling spikes followed by a choppy rise, selling spike, choppy rise... The big players are very good at controlling the market so as not to spook it while they unload inventory.

Linda Piazza : 5/15/2008 3:28:40 PM

As the close of the next 30-minute period approaches, it may well be that the SPX closes another 30-minute period either at or beneath Keltner resistance that now ranges from about 1418-1419. The SPX is 1418.05 as I type. For three and a half hours, the SPX has been testing this resistance, sometimes piercing it, always nudging it higher, but not able to close above it. That's not usually a sign of strength, but it's certainly not any blessing for bears today waiting for a rollover, either.

Jeff Bailey : 5/15/2008 3:28:04 PM

PM/MO ... 53.18 and 22.30 = $75.48

MZS-FO $1.71 x $1.75

Jeff Bailey : 5/15/2008 3:24:42 PM

VIX.X 16.72 -5.32% ...

Jeff Bailey : 5/15/2008 3:23:52 PM

Buyers look to have the SPX 1,418 eyeballing the heavy OI at 1,425 strike. Things could heat up into the close.

Jeff Bailey : 5/15/2008 3:18:44 PM

At the 03:00 tick, NYSE reported 2,180 advancers and 1,133 declines, an improvement from the 02:00 tick of 1,855:1,191.

NASDAQ also slightly improved with 1,659 advancers and 1,208 decliners.

Keene Little : 5/15/2008 3:15:36 PM

SPX keeps pushing to marginal new highs but it's climbing in a choppy fashion and looks more like an ending pattern to the upside rather than getting ready to blast higher. It may all be part of an effort to keep the bears away and hold it up into the close for expiration.

Linda Piazza : 5/15/2008 3:09:16 PM

It's a lot more fun watching a day like today on a 1- or 2-minute chart. On the 2-minute chart, the SPX has spent the last several hours zooming from a line that's now 1418.70 and one that's now 1414.93. Moreover, each time it's fallen this steeply from that line now at 1418.70, it has approached that support level. This time is so far looking a little different since the SPX is charging right by up again before it go anywhere near that lower support line. Not to be cynical, but I'm not sure that means anything at all.

Jeff Bailey : 5/15/2008 3:04:47 PM

Bond market closes ... 13-week was up a fractional 0.5 bp at 1.790%. 5-year yield was down 11.7 bp at 3.111%, the benchmark 10-year lower by 9.5 bp at 3.843% and 30-year lower by 6.1 bp at 4.576%.

Tab Gilles : 5/15/2008 3:00:33 PM

Composite technology (CPTC) With wind turbines in the news (T Boone Pickens) this alternative energy source is growing in popularity. I came across this small speculative stock that is flying under the radar.

PnF chart has a Bullish PO of $4.63. Link Link Link

Jeff Bailey : 5/15/2008 2:59:41 PM

Don't let yesterday's "prairie dog" turn into a wolf.

Linda Piazza : 5/15/2008 2:58:30 PM

Here we go again, with resistance being tested on both the 7-minute and 30-minute charts on the SPX. It wouldn't take much to pop the SPX above this resistance and run a little higher with it, with the 7-minute and 15-minute charts at least suggesting that a run up to 1419.50 or even 1423 isn't out of the realm of possibility. However, the resistance being tested is resistance that's held after several tests today, so if in bullish positions, you should at least consider the possibility that it will hold again and prepare accordingly as we had into the last hour of trading. The bond market closes in a few minutes and that can change the tenor of trading.

Jeff Bailey : 5/15/2008 2:58:03 PM

VXO.X 17.46 -0.82% ... WKLY S1 18.04, WKLY S2 16.26.

Jeff Bailey : 5/15/2008 2:56:44 PM

OEX Call OI at the 650 strike has fallen notably since last update.

655 now largest at 6,924.

Linda Piazza : 5/15/2008 2:52:44 PM

I still can't tell whether the SPX is more likely to rise toward 1417.80 or drop toward 1414.40. There's a slightly better setup for the rise, but only slightly and that's not good enough to make any predictions in this market.

Jeff Bailey : 5/15/2008 2:50:12 PM

USO $100.22 (unch) ...

Linda Piazza : 5/15/2008 2:45:59 PM

Thought I'd give figures for you OEX traders: potential resistance on 7-minute closes at 649.86-650 and on 30-minute closes at 649.97 and then 650.71. Potential support on 7-minute closes at 648.05-648.10 and on 30-minute closes at 648.31. So far, though, the OEX, like the SPX, is sort of hanging this current 7-minute candle along its flattening 7-minute 9-ema, neither pulling above it nor dropping below it, so whether support or resistance is most likely to be tested next is hard to predict.

Jeff Bailey : 5/15/2008 2:43:51 PM

PM bumping against would would be considered 80.9% of its spin-off range.

Jeff Bailey : 5/15/2008 2:42:45 PM

PM/MO $52.94 and $22.18 ... MZS-FO $1.60 x $1.71

Keene Little : 5/15/2008 2:41:28 PM

It wouldn't surprise me in the least to see the market held up into the close by some big players so that their sold SPX puts expire worthless tomorrow morning.

Linda Piazza : 5/15/2008 2:37:32 PM

Not sure the SPX is through testing support yet. That's now at 1414.23 on 30-minute closes. I wouldn't even be terribly surprised to see the SPX test the bottom of that bear flag type formation, with that now at about 1412.40, but neither would I be surprised to see it test the top of it again, with that now at about 1417.80. However, I did want to note that it might not be through testing the support yet.

Keene Little : 5/15/2008 2:32:20 PM

Starting to let go a little here. If we get another afternoon selloff then the pattern is becoming clearer--distribution at the highs.

Linda Piazza : 5/15/2008 2:31:13 PM

And it certainly looks as if resistance is going to continue holding into this 30-minute close. The 30-minute 9-ema is now 1413.99 and that's potential support on 30-minute closes. The 7-minute chart shows potential support at 1413.48-1413.92.

Linda Piazza : 5/15/2008 2:22:10 PM

This last 90+ minutes is going to be a long 90+ minutes, I think. So far, the resistance depicted in my 2:16:42 post is holding. So far.

Jane Fox : 5/15/2008 2:20:42 PM

Both the VIX and RVX are telling us the markets are destined to move higher. Link

Keene Little : 5/15/2008 2:19:29 PM

If SPX can continue to press higher, it will meet resistance at yesterday's high near 1420, the 50% retracement of the October-January decline at 1423 (and there's a Gann level at 1421) and then its 200-dma just under 1428. The field is littered with mines for bulls and bears are sitting in the woods ready to hose them down.

Linda Piazza : 5/15/2008 2:16:42 PM

Here's where the SPX is now on the 7-minute chart: Link Here's where it is on the 30-minute one: Link Resistance is being tested on both.

Keene Little : 5/15/2008 2:13:45 PM

Getting the push higher. Now we'll see if a new high is met with bearish divergences or not (so far it looks like it will). NDX looks like it could make a new high above yesterday's.

Jeff Bailey : 5/15/2008 2:11:22 PM

Last night's USO May "Max Pain" Theory stood at $97.00 for the USO. Session low so far has been $97.69.

Linda Piazza : 5/15/2008 2:10:27 PM

Potential resistance for the SPX at 1416.96 on 7-minute closes, at 1416.89-1417.10 on 30-minute closes, so it's gathering near there on several charts. Potential support on 7-minute closes at 1413.48-1413.50 and at 1414.08 on 30-minute closes, so support is converging, too. Between there, it's anyone's guess. The formation on the SPX's 7-minute chart, pulling back from the day's high, looks like a potential bull flag, but the bigger formation climbing up from the day's low looked like a bear flag. On a 7-minute chart, the SPX broke above that bear-flag, but if viewed on a 15-minute chart, you see upper candle shadows poking above that flag's top trendline but the candles forming at or below it, showing that the top trendline is holding as resistance. There's plenty of evidence to cheer bulls; plenty to at least console the bears. So far, for sure, bulls are not giving up, so you should certainly watch such things as the A/D line for evidence that they are still strong or are losing strength. The A/D line has been consolidating sideways for almost two hours, so bulls need a breakout to a new high above the current 857.00 high and values maintained above that. The A/D line is 789 as I type.

Jeff Bailey : 5/15/2008 2:10:13 PM

Could be a "dinger" of a week for oil and Eur/$ next week.

Jeff Bailey : 5/15/2008 2:09:11 PM

That 5-minute interval volume spike in the USO ... might be related to June's "Max Pain" of $99.00. Tough to call right in here between May M R1 and QRTR R2.

Senate bill on Enron loophole getting some play.

Keene Little : 5/15/2008 2:07:16 PM

The little sideways/down consolidation over the past hour looks like a bull flag, pointing to another push higher. The flip side is that a failure of the bull flag would like see a sharp drop lower. It's all small time-frame stuff while waiting to see who blinks first.

Jeff Bailey : 5/15/2008 1:58:58 PM

If USO's going to $83, then we'd look for selling here.

Linda Piazza : 5/15/2008 1:58:10 PM

And then, as soon as I typed that 1:57:20 post with the SPX headed down, it bounced right back up again.

Jeff Bailey : 5/15/2008 1:57:58 PM

USO comes to MONTHLY R1 ($99.26) ...

Linda Piazza : 5/15/2008 1:57:20 PM

So far, the SPX appears to having a little difficulty maintaining values above about 1415.10 on 7-minute closes, suggesting but not promising that it may again test the 1413.50-1413.75 zone. That's the best I can do, folks, on an opex Thursday that's behaving exactly the way you'd expect one to behave, and I'd even take that with a grain of salt. Oops, SPX headed down as I typed.

Linda Piazza : 5/15/2008 1:49:55 PM

There's the SPX move down to test its 30-minute 9-ema, a test I thought was likely to occur. That 9-ema is now 1413.75 and the SPX is bouncing after barely piercing it. The outcome of this test? Who knows. I'm not being sarcastic but am instead again emphasizing how little trust you should put in setups today. However, unless the SPX can maintain values above about 1415.15, it at least looks likely to test that 30-minute 9-ema again. If it can maintain those values, as it is attempting to do, it looks more likely to rise up toward 1416.65-1417.10 again. After that, I just don't know.

Linda Piazza : 5/15/2008 1:39:19 PM

I wanted to mention that I won't be doing the Wrap tonight, although I will return next Thursday and will substitute for Keene the Wednesday after that. I'm sure I'll be substituting here and there at other times, too. After long reflection on my family's situation, with my granddaughter now on week-to-week monitoring to determine if she needs her next surgery, I needed to lighten my work load and release obligations that offer the least flexibility. I'm personally looking forward to the new writer's Wrap tonight, as I always learn from each of the dedicated writers on Option Investor.

Linda Piazza : 5/15/2008 1:33:37 PM

Potential SPX resistance on 7-minute closes (not three-minute, as I've been mistakenly saying in some posts) is now 1417.13, now not so far above the top trendline of the bear flag formation. The 7-minute 9-ema is now about 1415.15. The SPX has been maintaining 7-minute closes above that, prompting my statements about not being sure that the SPX was through testing resistance yet. It would have to maintain levels below that 7-minute 9-ema before I would even begin to conclude, even tentatively, that it was through doing so. On the 30-minute chart, the SPX's potential resistance on 30-minute closes has again held, again suggesting that it will eventually need to retreat back to its 30-minute 9-ema to regroup. That 9-ema is now at 1413.86. However, I repeat what I've repeated all day: such setups mean little on days like this.

Tab Gilles : 5/15/2008 1:26:47 PM

EMCORE (EMKR) Heres an interesting company that has been controversial over the last few months. Speculators believe the company may split in 2, the semi business and the solar business.

Emcore makes the world's highest efficency solar cells. The concentrated PV market, which uses mirrors to reflect sunlight onto efficient and relatively small areas of PV cells, gives this company enormous potential.

There's been heavy insider buying over the last several weeks. Link

Keene Little : 5/15/2008 1:24:45 PM

If today's bounce is a wave-2 correction (which must stay below yesterday's high) then the 3rd wave down will be next. The reason 3rd waves are so strong is because the new buyers in a wave-2 bounce (or sellers in a wave-2 pullback) get surprised by the decline and by the time they start bailing on their positions it just adds more selling pressure. That's why the 2nd wave correction is considered the head fake before the real move. It remains to be seen if that plays out but if it does then the next leg down will be accompanied by some strong selling and take it well below this morning's low.

Linda Piazza : 5/15/2008 1:21:30 PM

Not sure the testing of resistance is over yet. Resistance now at 1417.25 on 3-minute closes, a bit lower than that on 30-minute closes. The 3-minute chart suggests a short-term possibility (no longer probability) of rising to test resistance; the 30-minute one is showing that resistance looks more likely to hold by the 30-minute close and prices to turn back eventually toward the 30-minute 9-ema, now at 1413.55.

Linda Piazza : 5/15/2008 1:14:26 PM

The SPX again hit the target on the 3-minute chart, with that also again serving as resistance on a 3-minute close. Before that's erased as a short-term target again, however, the SPX would need to maintain 3-minute closes beneath about 1414.65.

Rolling up to a 30-minute chart, I see that the resistance now from 1416.43-1416.60 on 30-minute closes is so far holding, too. Where does the SPX go next? I don't know on a day like this because setups matter little. However, if it bounces from that 3-minute potential support, then it's essentially finding support on the top of that bear-flag-looking formation that it broke above a while ago, and that's the more bullish case that at least suggests that it will go on testing resistance. If it loses that support on 3-minute closes, that suggests a greater likelihood of pulling back within the bear flag again. "Suggests" is the operative word on a day like today, however.

Keene Little : 5/15/2008 1:12:51 PM

If yesterday afternoon's decline was wave 1 of a new leg down, then today's bounce is a wave-2 correction. The personality of a 2nd wave correction in a bear market is to get the bulls all excited about the prospects of new highs, and frighten the bears out of their positions. So what do you think, is today's bounce working like that? I know it's got me nervous about my short position.

Jeff Bailey : 5/15/2008 1:09:30 PM

Most Actives ... CNET $11.40 +43.39%, QQQQ $49.77 +1.34%, YHOO $27.10 -0.14%, INTC $24.29 +1.88%, SPY $141.85 +0.76%, CSCO $26.22 +1.82%, MSFT $30.43 +1.67%, AAPL $188.95 +1.44%, NVDA $23.48 +6.38%, BAC $36.50 -0.84%

Jeff Bailey : 5/15/2008 1:06:24 PM

ICE looks up

Jane Fox : 5/15/2008 1:04:30 PM

WASHINGTON (MarketWatch) - U.S. home builders see no signs of improvement in the housing market after a disappointing start to the spring selling season, the National Association of Home Builders reported Thursday. After stabilizing at 20 the past three months, the NAHB/Wells Fargo home builders' sentiment index fell back in May to 19, only one point above the record low of 18 set in December. Builders' assessment of current sales have never been gloomier in the 23-year history of the survey, with the sales index falling to 17 in May from the previous record low of 18 in April. The sales climate is so bad that the builders say that only a federal subsidy for home buyers will turn the market around.

Jeff Bailey : 5/15/2008 1:04:18 PM

TOL $24.83 +4.59% ...

Jeff Bailey : 5/15/2008 1:03:53 PM

NAHB saying its May Housing Index fell to 19 in May.

Jeff Bailey : 5/15/2008 1:01:56 PM

Corn/wheat getting hit.

Linda Piazza : 5/15/2008 1:01:47 PM

Another test of resistance near 1417.21 (7-minute closes) is possible. Not promised, though. I'd watch for potential rseistance there again, if it is.

Jeff Bailey : 5/15/2008 1:00:57 PM

US Senate Approves Farm Bill With 81 to 15 Vote.

Jane Fox : 5/15/2008 12:59:24 PM

Internals are bullish so I would be careful shorting this market. Link

Linda Piazza : 5/15/2008 12:57:08 PM

Here's the SPX on a 7-minute chart, a chart I watch often but don't mention as often because it's not as closely watched by others. It's the chart that gave me the 1417.20 target I mentioned in my 12:42:52 post. That Keltner line is dynamic, of course, and has lowered since then but you can see that the SPX ran right up and touched it and then started pulling back. Link As you can see, the SPX threatens (but not promises) to pull back within that bear flag shape.

Jeff Bailey : 5/15/2008 12:54:22 PM

ICE should be set to open within minutes.

Linda Piazza : 5/15/2008 12:51:42 PM

Here's where the SPX is on the 30-minute Keltner chart, testing Keltner resistance: Link I list these levels for you, but sometimes I think you need a picture.

Jeff Bailey : 5/15/2008 12:50:30 PM

SMH $32.85 +1.13% ... still battles 50% conventional.

Linda Piazza : 5/15/2008 12:49:29 PM

The A/D line continues to climb. As long as it does, don't bet on a downturn, but do keep a watch on it. It's +754 as I type, pulling back just a little from the day's high of 840 and its test of 875-ish potential Keltner resistance on 30-minute closes. That looks like light resistance, though, but today such setups matter little. When this action is viewed on an intraday chart, it looks like amazing strength, but when we remind ourselves what's happening by turning to a daily one, we see the SPX still with a small-bodied candle, still within yesterday's range. While the gains put us on watch for a possible move up toward the 200-sma, now at 1428.14, nothing yet promises it or precludes that choppy, small-bodied candle consolidation day for today, either.

Jeff Bailey : 5/15/2008 12:49:26 PM

NVIDIA (NVDA) $23.40 +6.02% ... bold move on break above that "right shoulder" of failed h/s top 60-minute interval.

Jeff Bailey : 5/15/2008 12:47:37 PM

Oooooeee!

Keene Little : 5/15/2008 12:46:07 PM

There's not much slowing down the bulls today. NDX and SPX (the two strongest ones today) are looking like they're gunning for yesterday's highs. I remain bearish against yesterday's highs but this is opex and I know anything goes. A new high will not necessarily hold but stay disciplined and honor your stops.

Jeff Bailey : 5/15/2008 12:43:23 PM

USO does see trade back at QRTR R2.

Linda Piazza : 5/15/2008 12:42:52 PM

The SPX is now attempting a breakout above that potential bear flag formation in which it's been climbing. It still has potential resistance on 30-minute closes now up to 1416.80, but supposedly strongest at 1416.10. One chart I'm watching suggests that it has a current upside target of 1417.20, however, which is being quickly approached as I type.

Keene Little : 5/15/2008 12:36:54 PM

SPX is hitting its Fib target zone for the bounce and is a good setup for a short play. The stop needs to be above yesterday's high and that makes it wider than I like. A closer stop could be at 1418 which would be above a 78.6% retracement of yesterday's decline and would mean we'll likely see new highs.

Jeff Bailey : 5/15/2008 12:36:16 PM

Eur/$ 1.5468 -0.02%

Jeff Bailey : 5/15/2008 12:35:43 PM

Swing trade put filled alert! ... USO $99.03 -1.18% ... IYS-RR $3.50 offer

Jane Fox : 5/15/2008 12:34:46 PM

Crude is falling and down to $122. Licking my chops because once it gets to $120 I will be looking for another long. Of course I will need some evidence that the support is holding. If not the next stop will be $110 and that would an impossible trade to avoid.

Jeff Bailey : 5/15/2008 12:31:13 PM

Swing trade put alert! ... for one (1) of the US Oil Fund USO Jun $96 Puts (IYS-RR) with a LIMIT price of $3.50.

USO $98.72 -1.49% ...

Linda Piazza : 5/15/2008 12:31:10 PM

The SPX is now at the top of a bear-flag-looking rise off the day's low but still climbing or at least testing. If it breaks out, it's got potential Keltner resistance at 1415.30 on 30-minute closes with that just above the 1415.10-ish level that represents a 61.8% retracement of the decline from yesterday's high to today's low. If it maintains values too much above that and particularly if it maintains 30-minute closes above 1415.30, then there's something more bullish going on short-term than a bear flag, and I'd watch for next resistance at 1418.05-1418.84 (15-minute closes). However, the SPX hasn't yet broken above that 61.8% level, tested that 30-minute resistance or even pushed up out of that potential bear flag. It's just testing it so far. Bulls need to be watchful of the potential for it to pull back through that flag, with the bottom of that flag now rising toward 1410.57 potential support on 15-minute closes. SPX at 1414.26 as I type.

Keene Little : 5/15/2008 12:23:38 PM

USO has dropped hard in the past 30 minutes, finally cracking back below the $100 level.

Keene Little : 5/15/2008 12:21:56 PM

Natural gas futures have taken quite a spill this morning, breaking Tuesday's low. Could the rest of the energy complex be far behind?

Jeff Bailey : 5/15/2008 12:20:12 PM

It should not go unnoticed that yesterday's NH/NL tally among the small cap RUT.X came in at 61:24.

The 61 new highs were the most since 12/26/07's 62:21.

Jane Fox : 5/15/2008 12:18:15 PM

Crude is consolidating at yearly highs and suggests the next move is a blast up. Eventually this will stop but for now this energizer bunny just keeps going and going. Link

Linda Piazza : 5/15/2008 12:17:48 PM

One reason that the SPX has been having some difficulty with this currently being tested level today is that the 50% retracement of its decline from yesterday's high into today's low is at 1413.53 (calculated). That 50% level tends to be difficult resistance at times. The 61.8% level is 1415.10, where we see Keltner resistance, too.

Keene Little : 5/15/2008 12:17:07 PM

Two equal legs up for SPX is at 1415.45 and a 62% retracement of yesterday afternoon's decline is at 1415.09 so that area is potential resistance to watch for a short entry.

Jeff Bailey : 5/15/2008 12:16:20 PM

NH/NL measures improved markedly yesterday as we head into this week's option expiration.

After finishing with 144:65 at the NYSE, the 12:00 tick has the NYSE reporting 77 NH and 59 NL.

NASDAQ finished yesterday's trade with 82 stocks having achieved a new 52-week high, but by the close, 92 stocks had traded a 52-week low at some point during the day.

Most notable among the NH/NL measures institutional traders will note is that the S&P 500 recorded 32 new highs. That's the highest number of new highs since 12/07/07. New lows among the 500 components tallied just 2.

Keene Little : 5/15/2008 12:15:44 PM

Interestingly techs are not being accompanied by small caps in its push higher. The RUT has yet to exceed this morning's high.

Keene Little : 5/15/2008 12:14:58 PM

Techs leading higher again so now it looks like we'll get at least a larger 3-wave bounce. That makes for an upside target for NDX at 2018 where it will have two larger equal legs up from this morning's low.

Linda Piazza : 5/15/2008 12:13:22 PM

The OEX has potential resistance at 647.10 on 30-minute closes.

Linda Piazza : 5/15/2008 12:12:51 PM

The SPX has potential resistance on 30-minute closes at 1411.90 with next resistance at 1415.17-1416.48 on 30-minute closes.

Jeff Bailey : 5/15/2008 12:06:51 PM

After a mixed to lower open stocks have steadied and now post modest gains.

Breadth at the big board has improved from the 10:00 hour (1,333:1,509) and advancers now outnumber decliners by a 16:13 margin.

NASDAQ breadth also improved modestly from 11:12 to 13:13 at the 12:00 PM EDT mark.

Keene Little : 5/15/2008 12:06:14 PM

The US dollar and euro have not made much of a move today but the metals have--both gold and silver shot higher this morning and I'm not sure why. Right now gold has bounced back up to its downtrend line from March so it's another short play setup with a tight stop just above its last high at 890.80 (and the reason for my stop at 891 on my short). Daily chart of gold contract (GC, June): Link

If the rally continues then I'll be watching to see how price reacts around 904.40 which is where the bounce off the May 2nd low would have two equal legs up.

Jeff Bailey : 5/15/2008 12:02:56 PM

As of last Friday, crude oil inputs into refiners was averaging 14.8 million barrels/day for the past month (4 weeks)

Jeff Bailey : 5/15/2008 12:01:07 PM

Excellent, excellent comments being made on CNBC regarding SPR.

Jane Fox : 5/15/2008 11:50:47 AM

Gold is on a tear and up almost confirming the higher low. If it does then the short term trend turns to up. Link

Jeff Bailey : 5/15/2008 11:43:20 AM

CNBC just reported that the ICE exchange was down and with option expiration in futures, may be having great impact on energy trade this morning.

Jeff Bailey : 5/15/2008 11:37:14 AM

SYMC $20.82 +1.11% ...

Linda Piazza : 5/15/2008 11:36:53 AM

Okay, so here's the current setup on the 30-minute SPX chart, for whatever it's worth: the SPX currently looks likely to chop between 1411.80 on 30-minute closes and 1406.36 on 30-minute closes. I can't emphasize enough how little such setups can mean on days like today.

The corresponding setup for the OEX is between 647.20 on 30-minute closes and 645.94 (or maybe even 644.86) on 30-minute closes. The OEX bears watching, though, because it's weaker on a Keltner basis and could lead the SPX and other indices lower.

Jeff Bailey : 5/15/2008 11:36:52 AM

Dang ... MFE $36.45 +2.04% ... wasn't alert at the open.

James Brown : 5/15/2008 11:26:40 AM

Goldman Sachs is under performing today. GS is down 2.1% (to $186.25) after having one firm downgrade their earnings estimates on GS. Short-term technical indicators do look bearish here but I would hesitate to buy puts as GS nears potential support around $180 and its 50-dma.

Jeff Bailey : 5/15/2008 11:24:42 AM

The h/s bottom pattern in TOL taking its time to play out Link ... still at its neckline.

Linda Piazza : 5/15/2008 11:23:15 AM

So far, the SPX's 30-minute 9-ema is still holding as resistance, and the last 15-minute close above the 15-minute version, now at 1411.10 meant little. That's what I mean about my expectations for today's action. I'm making posts about what I'm seeing, but I am telling you that I'm not putting much credence in any setup I see and any short-term action, either, and I urge you not to do so, either. Nothing has happened to rule out any scenario for today, including the least likely but especially not the two most likely--choppy consolidation or an actual downturn.

James Brown : 5/15/2008 11:23:08 AM

Another energy stock soaring today is PXP, which is up more than 4% and breaking out over short-term resistance near $68.00. An analyst gave the stock a new price target of $80.00 this morning.

Keene Little : 5/15/2008 11:19:23 AM

There's the first break of the succession of higher lows and an indication we have probably seen the high for the bounce. At least that's the potential. So short against this morning's high is the right play.

James Brown : 5/15/2008 11:18:54 AM

Oil Service stocks are up strongly today.

The OSX index is up more than 2%. The OIH is up 2.5%.

The group is getting a lift from some positive analyst comments out of UBS this morning. A few stocks that UBS is positive on are: ATW, DO, ESV, NE, RDC, and RIG.

RIG was given a $201 price target. RIG is up 4.2% to $153.51.

Jeff Bailey : 5/15/2008 11:15:27 AM

Of course, "h/s tops" down at these levels not overly concerning and 60-minute not all that reliable.

Now, the reverse h/s bottom pattern for the TRAN daily, now that was worthy. Link

James Brown : 5/15/2008 11:12:27 AM

Looks like a bullish reversal in SGR. Three or four days ago the stock was dancing with a bearish breakdown under support. Now the stock has reversed higher and is breaking out over resistance. chart: Link

Jeff Bailey : 5/15/2008 11:12:07 AM

60-minute interval chart of NVDA shows would could be a little "h/s top" pattern. So, leg out of the near-month calls and take the profit. Hold the September's. My strategy at least.

Keene Little : 5/15/2008 11:10:15 AM

Techs look to be leading the way again, this time to the upside in this morning's bounce. It has a bit of a rising wedge appearance so the push higher right here could be finishing it. A 50% retracement of yesterday afternoon's decline for NDX is at 2010.20. This morning's bounce has a succession of higher highs and lows so any break below the higher lows would be a signal that the top of the bounce is in.

Linda Piazza : 5/15/2008 11:10:06 AM

The TRAN is jumping up now, following other indices higher. It's still caught within its day's range, so it's so far being a follower and not a leader, but this is at least better for those with bullish hopes than not following at all. The SPX is, however, hesitating near the 30-minute 9-ema with that at about 1412.42 now, and the SPX just above it at 1412.54. Next resistance above this is 1414.45, but the signs are mixed enough that I really can't give you a prediction as to whether that's likely to be tested or whether today's first test of the 30-minute 9-ema will result in the SPX getting knocked back again and chopping around a bit lower, as is all too possible.

Jeff Bailey : 5/15/2008 11:09:12 AM

NVIDIA (NVDA) $22.93 +3.89% ... does trade yesterday's "bad tick" of $22.99.

Jeff Bailey : 5/15/2008 11:08:01 AM

Most Actives ... CNET $11.42 +43.64%, QQQQ $49.42 +0.63%, YHOO $27.47 +1.21%, INTC $24.23 +1.63%, AAPL $187.48 +0.65%, SPY $141.50 +0.51%, CSCO $25.86 +0.42%, MSFT $30.09 +0.53%, BRCD $7.88 -1.74%, SINA $55.97 +5.30%

Linda Piazza : 5/15/2008 11:05:41 AM

The TRAN is pretty much in the middle of its day's range, so this index that I like to use as an indicator index for the SPX, OEX and Dow isn't indicating much of anything right now. The A/D line is, however, near the new high of the day, although still in the bearish half of the Keltner channels and below potentially significant resistance from about 450-500 on 30-minute closes. It's at 248 as I type. The USDJPY is 104.79, above the neckline of its potential H&S but not above the right-shoulder level, so not invalidating that formation. The VIX is near the low of the day. If I weighed all those together, I'd come out with a neutral to slightly bullish tenor, a bullish enough tenor to suggest this test of next resistance, but I'm not sure it's enough yet to suggest that the SPX can get past the 30-minute 9-ema, now at about 1412.40 on 30-minute closes.

James Brown : 5/15/2008 10:58:45 AM

+60%.... F5 Networks (FFIV) is up about 60% in just the past five weeks. The stock is up another 2.4% today after having one analyst firm raising their price target to $33.00. The stock is trying to breakout over its 200-dma near $29.00.

James Brown : 5/15/2008 10:55:33 AM

The rally in SanDisk (SNDK) continues. The stock is up another 3.6% to more than $32.50. The stock got another boost today after an analyst raised their price target to $38.00. The two-month trend is certainly bullish but I'd probably wait for a dip in the $30.50-30.00 zone before considering bullish positions.

James Brown : 5/15/2008 10:52:35 AM

Most of the coal stocks are up today and many are hitting new all-time highs. The group got a boost from some positive analyst comments on the sector. A lot of these stocks look overbought. A few symbols: ACI, ANR, BTU, CNX, FCL, FDG, ICO, MEE, PCX.

Linda Piazza : 5/15/2008 10:52:09 AM

After closing another 15-minute period at the 15-minute 9-ema, now at 1411.23, the SPX is again attempting to push above it, but that push just brings it closer to the 30-minute version, more important, with that version at about 1412.40 and with further potential rseistance on 30-minute closes at 1413.90. We haven't even seen yet whether the SPX will close this 15-minute period above the 15-minute version. So far, the pattern today looks like a choppy rise that could just as easily chop lower at some point, so I hesitate to offer too much cheer to bulls just yet.

James Brown : 5/15/2008 10:48:13 AM

Shares of high-end retailer Tiffany & Co (TIF) are doing well. The stock bounced from support near $45 and its 200-dma and shares are now up 6.2% near $49. This morning the company came out with positive earnings guidance. TIF now expects Q1 numbers to be better than its 39-cent estimate but they didn't say how much better. Management also raised its dividend. TIF is due to report around the May 29-30th.

James Brown : 5/15/2008 10:42:44 AM

Just a reminder, Kohl's (KSS) reports earnings after the closing bell tonight. The stock is still struggling to breakout past its 200-dma

James Brown : 5/15/2008 10:41:56 AM

J.C.Penney (JCP) reported earnings this morning. The results were 4 cents better than expected. The company actually guided higher for the second quarter (by a penny).

JCP did comment on lackluster same-store sales numbers and said the consumer is slowing down and that the rest of 2008 looks challenging.

The stock is up about 35 cents to $44.60 so we're not seeing much reaction in the share price.

The P&F chart is bullish with a $60 target but it's trying to push through resistance.

Linda Piazza : 5/15/2008 10:40:38 AM

You know that you have to evaluate your options trades based on what's happening with the underlying. If you're in pure long May put or call positions, you need to be evaluating them based on what's happening with premium decay, too. If the SPX or OEX or your particular underlying should just chop back and forth all day, your premium is going to leak out. Decide how much premium decay you're willing to endure as well as how much movement opposite your direction you're willing to endure. You have slightly more leeway with the OEX than with the SPX, of course, because OEX options trade tomorrow while the SPX ones stop today, but only slightly more leeway.

Jeff Bailey : 5/15/2008 10:33:53 AM

EIA weekly Nat. Gas Storage shows a build of 93 Bcf

Linda Piazza : 5/15/2008 10:28:07 AM

The SPX's 15-minute 9-ema is at about 1411.05; the 30-minute version at 1412.54, with the 15-minute version potential resistance on 15-minute closes. If the SPX should get past that on a 15-minute close, I'd start watching the 30-minute version for potential resistance. The SPX is 1410.66 as I type.

Keene Little : 5/15/2008 10:27:58 AM

Two equal legs up in this morning's bounce for the DOW is at 12921. A 50% retracement of yesterday afternoon's decline is at 12924 so that area makes for potential resistance to watch for a short entry.

Jane Fox : 5/15/2008 10:24:40 AM

WASHINGTON (MarketWatch) -- Banks and securities firms should continue to raise capital to help them navigate the treacherous waters of the financial market turmoil, Federal Reserve Board Chairman Ben Bernanke said Thursday. "I strongly urge financial institutions to remain proactive in their capital-raising efforts," Bernanke said in a speech to the Chicago Fed Bank's annual banking conference. Bernanke couldn't quite bring himself to criticize federal oversight of financial institutions, saying only that supervisors must redouble their efforts. Earlier this week, San Francisco Fed president Janet Yellen bluntly said that the Fed "missed" some of the risky developments as they were unfolding.

Jeff Bailey : 5/15/2008 10:24:33 AM

Swing trade call exit alert! ... Let's exit the NVIDIA NVDA June $20 Calls (UVA-FD) at the bid of $2.95.

NVDA $22.61 +2.44% ...

Hold the Sep. $22.50's

Linda Piazza : 5/15/2008 10:19:27 AM

The OEX is chopping around its central basis line on its 15-minute chart today, with that at 645.68. Because it's chopping back and forth around across it, the central basis line loses its benchmark status, other than telling us that the OEX action is choppy! In other words, it's not telling us any longer that if the OEX closes 15-minute periods above it, it's likely to go to some upside target, or, if below it, to some downside target. While I'm not surprised to see this happening given my outlook for the day, it's a bit discouraging because I can't give you any predicted possible targets. All I can tell you is that my "choppy consolidation or an actual pullback" scenarios for the day both remain possibilities so far. We can't even rule out the third and less likely (from the setup) scenario--a gain. I can say that if the OEX should drop to about 643.44, I would watch for potential support there on 15-minute closes and if it should rise again to 646.78, I would watch for potential resistance there on 15-minute closes.

James Brown : 5/15/2008 10:18:48 AM

The breakdown in the Euro (FXE) ETF has stalled in the past couple of weeks. It has been trading sideways in the $154-156 zone. Looking at the weekly chart it seems like the FXE is still poised to move lower. Yet I wonder if it's going to rebound to its 20 or 50-dma before rolling over again. chart: Link

Linda Piazza : 5/15/2008 10:12:55 AM

Just a whole lot of chopping around so far for the SPX, which is not unusual, given the day it is and the possible setup for the day. So far, I'm seeing about an equal possibility that it could rise into 1412.20-1413.25 or drop toward 1406.10-1406.25.

Linda Piazza : 5/15/2008 10:11:23 AM

The VIX's 15-minute 9-ema is now 17.37, and short-term bears would like to see it maintain 15-minute closes above that. It's got potentially significant resistance at 18.02-18.12, however, so if it continues rising, bears need to have their profit-protecting plans updated as the VIX approaches that potentially significant resistance.

Jeff Bailey : 5/15/2008 10:11:03 AM

December Fed Fund Futures (ff08z) ... tick at 97.80 now has the look that market participants place an 85% probability of a 25bp rate HIKE between now and end of year.

Keene Little : 5/15/2008 10:09:22 AM

There was a little volatility around the Philly Fed numbers but the market is essentially where it was. So far the bounce attempt appears corrective so it could develop into a larger bounce but so far I don't see anything yet to suggest we'll see a new rally leg.

Linda Piazza : 5/15/2008 10:08:45 AM

The May Philly Fed was -15.6. In April it was -24.9. It's still in contraction territory, but less negative than in April, obviously. It beat expectations of a -21.0.

Tab Gilles : 5/15/2008 10:06:32 AM

$VIX - Volatility Index is testing lows last seen when the market topped back in Oct. '07. Link

Linda Piazza : 5/15/2008 10:05:16 AM

SPX now 1409.15. Potentially strong support on 15-minute closes is 1403.52-1405.21. Remember the potential choppy consolidation scenario for today when you look at these posts about possible support or resistance because it's possible that the SPX will set and reset targets all day.

Linda Piazza : 5/15/2008 10:03:48 AM

The SPX jumped right up to test the 15-minute 9-ema, now at 1411.61. So far, it's being bumped lower from that test, and is now 1410.56, but we still have lots and lots of time in this 15-minute period. Potential support is now about 1410.25 on 15-minute closes.

James Brown : 5/15/2008 10:01:06 AM

Overseas markets....

Chinese Shanghai .... -0.5%
Hong Kong Hang Seng . -0.08%
Japanese NIKKIE ..... +0.9% (breaking out over 14,000 level)

French CAC 40 ...... -0.3%
German DAX ......... -0.4%
London FTSE ........ +0.2%

Brazilian Bovespa ... +0.5% (trading near all-time highs)

Linda Piazza : 5/15/2008 9:59:56 AM

A/D line bouncing strongly. It looks as if the A/D line will likely end this 30-minute period well above the potential support I mentioned earlier at 30-minute closes, with that now at about -245. The A/D line is -100 as I type. That picture could change radically any moment, either direction.

Linda Piazza : 5/15/2008 9:56:56 AM

We're approaching the release of the Philly Fed. Be careful here. Evaluate now whether you have too much risk on the table or profit you just don't want to keep at risk, and take appropriate action. If you were in a bearish trade from yesterday afternoon's high, for example, and it's in May SPX puts that stop trading this afternoon, do you want to take partial profits at least? Doing so has risks: the risk that the SPX will crater and you won't participate fully. Not doing so has risks, too. Only you can evaluate which is best for you.

Tab Gilles : 5/15/2008 9:55:50 AM

Weekly $COMPQ Link

Linda Piazza : 5/15/2008 9:53:45 AM

This morning, the RUT's volatility index, the RVX, charges higher again, but it's charging right into potentially strong resistance on 30-minute closes at 23.04. It's currently 22.87 with a high so far of 22.95. I haven't watched the RUT/RVX pair long enough to know whether the RVX is likely to be stopped by this potential resistance or that above, at 23.46, but I wouldn't be surprised to see its climb stalled by one or the other. Watch it for some planning help but since I have only short-term anecdotal evidence that these two move in juxtaposition to each other, don't use the RVX's actions as a trigger for any trade action, just as a trigger for "I need to plan."

Linda Piazza : 5/15/2008 9:48:40 AM

A/D line now -404. USDJPY now 104.62, however, so far bouncing back above the neckline of that H&S on its 15-minute and 30-minute (all hours) chart. I do include all hours on my USDJPY charts because, in my opinion, what happens when the Nikkei is trading is every bit as important as what happens when our cash markets are open.

Linda Piazza : 5/15/2008 9:45:11 AM

Turning to the 15-minute charts for a shorter-term view, I see potential resistance for the SPX on 15-minute closes at about 1410.25 and then at the 15-minute 9-ema at 1412.48. For the OEX, these numbers are 646.96 and 647.69. The OEX is way underperforming the SPX on a Keltner basis this morning, barely holding on to support that is analogous to the SPX's 1405.08 level.

Keene Little : 5/15/2008 9:43:30 AM

The DOW is a little weaker than SPX this morning so it could hit potential support earlier at its uptrend line from March, currently near 12820, about 50 points lower. There is still the potential for a bounce to at least retrace a portion of yesterday afternoon's decline and the potential for some choppy whipsaw moves remains high.

Linda Piazza : 5/15/2008 9:38:39 AM

Keltner outlook on the A/D line: The A/D line opened just above potential support on 30-minute closes at about -250 and is dropping through that support as I type. This is support that tends to hold the A/D line unless there's a runaway day, but you have to give a little leeway for the A/D line, which tends to overrun support or resistance just a little at times. That may be all it's done so far, particularly since there hasn't been a 30-minute close. The A/D line is -300 as I type. So, watch for a potential steadying through here. Bears don't need a lot more from the A/D line now. They just need it to stay somewhere around this level and can even see it just move sideways, and it supports their position, but there's the potential for it to bounce more strongly, particularly after the Philly Fed, if the news is good. Bears must evaluate risks and positions before then.

Jane Fox : 5/15/2008 9:37:45 AM

VIX is making new daily highs and the Russell volatility index, RVX is as well.

Jane Fox : 5/15/2008 9:36:49 AM

AD line is neutral to bearish -325.

Tab Gilles : 5/15/2008 9:30:12 AM

Weekly EIA Report Link

Linda Piazza : 5/15/2008 9:27:06 AM

SPX futures are slightly above fair value this morning. Given the context--last week's weekly candle a completed reversal signal and yesterday's daily candle a potential one--my scenario for the day would be either another consolidation-type day or an actual downturn.

One of those would be my scenario if this weren't the Thursday of opex week and if Fed Chairman Ben Bernanke weren't speaking right about the time the markets opened and if we didn't have the Philly Fed at 10:00 am ET. Any one of those could undo any possible setup.

Actually, the Thursday of opex week often sees markets begin to chop around the levels at which they'll end the day by about mid-morning, so that fits with a possible choppy consolidation day. Maybe that's what we'll get. Or, maybe we'll get a rise into the Philly Fed and then a downturn if the new is bad.

What I'm suggesting is that you suspend too strong a belief in any one outcome today. Be prepared for potentially choppy price action that could seem to be leading first one direction and then another, with no targets realized. Bulls need to be prepared ahead of the Philly Fed in case that news is bad and markets react by pulling back, resulting in a downturn today. And, if the news is particularly good, that could undo either of the most two likely scenarios and send markets wildly higher. The technical setup suggests that's the less likely scenario of the three, but . . . you know the "but's."

Watch the USDJPY. On its 15-minute and 30-minute charts, it's setting up a potential H&S formation at the top of the climb off Friday's low. In the last few minutes, it may even have confirmed that formation, although I'd be leery ahead of the open of our market. Equity bulls want to see it pull above about 104.60 again and stay there.

If the SPX climbs first thing this morning, it will be facing potential resistance on 30-minute closes at 1411.02-1412.65. If it drops, it will find potential support on 30-minute closes at 1406.02 and then 1401.78. Don't lose sight of the Philly Fed at 10:00 am ET, however.

Jane Fox : 5/15/2008 9:26:22 AM

Gold has been struggling for a few days (weeks) now but I believe it will come back and retest resistance at 940-960. Link

Keene Little : 5/15/2008 9:23:51 AM

Equity futures chopped their way higher off the overnight lows and reached a high just before the 8:30 AM reports. Since that time much of gains have been given up. It wouldn't surprise me to see a correction of yesterday afternoon's decline but as mentioned last night, my recommendation is to be short against yesterday's highs.

Jane Fox : 5/15/2008 9:19:32 AM

The SPX tagged its resistance at 1420 yesterday and was promptly met by a bunch of bears waiting to bounce. The bulls just didn't have enough gunpowder to even trade through this resistance let alone close above it. We may just get a lot of nothing for a few days while the bulls and the bears battle this out. Link

Jane Fox : 5/15/2008 8:52:23 AM

Economic reports out at 8:30 didn't do much to lift the futures during the overnight session although the higher highs and lows does mean the bulls are in the drivers seat. Unfortunately though the bulls can easily drive off the road leaving us all in the ditch (choppy intraday sessions). We have seen that many many times lately. Link

Jane Fox : 5/15/2008 8:47:03 AM

Dateline WSJ - WASHINGTON ? Senate lawmakers are close to a deal that would expand a government program to insure hundreds of billions of dollars in refinanced mortgages, people familiar with the matter said.

The deal, if finalized later Thursday morning, could breathe new life into congressional efforts to stabilize the rocky housing sector. The bill would also overhaul supervision of mortgage-finance giants Fannie Mae, Freddie Mac, and the 12 Federal Home Loan Banks, an issue that has been a priority for the Bush administration for several years. If the fragile talks collapse, it would become extremely difficult for Congress to move forward with any housing policy package.

Staff members on the Senate Banking Committee have discussed legislation for weeks, and as recently as last week talks appeared to be faltering. But staff members for Senate Banking Committee Chairman Christopher Dodd (D., Conn.) and the panel's ranking Republican, Richard Shelby of Alabama, broke major ground Wednesday and continued talking until 2 a.m. Thursday

Jane Fox : 5/15/2008 8:42:14 AM

NEW YORK (MarketWatch) -- The average U.S. gasoline price rose about 2 cents to $3.78 a gallon in the last day, according to the Daily Fuel Gauge Report from the Automobile Association of America. The cost of gasoline has risen 22% from its year-ago price of $3.10 a gallon. It's up 11.5% from its price of $3.39 a gallon a month ago.

Jane Fox : 5/15/2008 8:41:47 AM

NEW YORK (MarketWatch) -- CBS Corp. said Thursday that it reached a deal to buy CNet Networks Inc. at a 45% premium, as the TV broadcasting giant moves to tap into the Internet to grow its business.

CBS Corp. said it would pay about $1.8 billion, or $11.50 a share, in cash for CNet , which operates CNet, ZDNet, GameSpot.com, TV.com, mp3.com, CNET news.com and other Web sites.

"The acquisition will make CBS one of the 10 most popular Internet companies in the United States, with a combined 54 million unique users per month, and approximately 200 million users worldwide," CBS said.

Shares of CNet closed Wednesday at $7.95, down 5 cents, while CBS shares ended the day 14 cents higher at $24.82.

Jane Fox : 5/15/2008 8:40:25 AM

WASHINGTON (MarketWatch) -- The number of people filing for the first time for unemployment benefits rose 6,000 to 371,000, on a seasonally adjusted basis, in the week ending May 10, the Labor Department reported Thursday.

The four-week average of initial claims, which smoothes out one-time factors such as bad weather or holidays, fell 1,000 to 365,750.

In the week ending May 3, the number of people collecting benefits gained 28,000 to 3.06 million - the highest level since March 2004.

The four-week average of continuing claims increased 15,250 to 3.02 million -- the highest level since April 2004.

Compared with last year, both initial and continuing claims are up about 23%

Jane Fox : 5/15/2008 8:39:51 AM

WASHINGTON (MarketWatch) -- Manufacturing activity in the New York area deteriorated slightly in May, the New York Federal Reserve Bank said Thursday. The bank's Empire State Manufacturing index fell to negative 3.2 in May from 0.6 in April. This is the third month in the last four that the index has been negative. Readings below zero indicate contraction. The report was weaker than expected. Economists were expecting to be essentially flat in April.

Jane Fox : 5/15/2008 8:36:20 AM

4-week avg. continuing claims highest in 4 years

4-week avg. continuing claims up 15,250 to 3.02M

4-week avg. initial claims down 1,000 to 365,750

continuing weekly jobless claims rise 28,000 to 3.06M

initial weekly jobless claims rise 6,000 to 371,000

Jane Fox : 5/15/2008 8:35:24 AM

May Empire State prices index up to record high

May Empire State index -3.2 vs 0.6 in April

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