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Keene Little : 5/22/2008 12:28:20 AM

Thursday's pivot tables: Link and Link

There was again a fairly big difference for most of the day between the DOW, which clearly looks like it has broken down, and the RUT which hints of being able to recover (even though it too broke its uptrend line from March). Sticking with the SPX I'm going to be watching to see how it handles the 1384 level if it drops a little further on Thursday. The combination of the broken downtrend line from October and the Feb 9th low at that level should provide support: Link

Regardless, if we get a bounce I'll be watching the form of it to help determine whether it will be just a correction of the decline or the start of something stronger back to the upside. We have a plethora of sell signals and indications of a weakening rally so I'm leaning bearish the market but it's still very early in the decline and I'll need more price action to help determine what kind of pullback we've got so far.

Jeff Bailey : 5/21/2008 11:10:41 PM

Major U.S. Equity Bullish % (update) from Dorsey/Wright at this Link

StockCharts.com's equivalents are

$BPNYA Link

$BPCOMPQ Link

$BPSPX Link

$BPOEX Link

$BPNDX Link

$BPINDU Link

Jeff Bailey : 5/21/2008 10:41:28 PM

Closing U.S. Market Watch at this Link

Airlines -11.95% ...

OI Technical Staff : 5/21/2008 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The Market Monitor has been archived.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 : 5/21/2008 9:54:25 PM

Closing Internals found at this Link

Jeff Bailey : 5/21/2008 9:48:29 PM

Biiig volume in the UltraShort Oil & Gas (DUG) $26.93 +2.66% today. #14 most active.

Jeff Bailey : 5/21/2008 4:38:10 PM

DXY's 04:00 tick was 71.91. Down 0.68% from yesterday's 04:00 PM EDT tick.

Jeff Bailey : 5/21/2008 4:31:51 PM

EIA's This Week In Petroleum Link

Jeff Bailey : 5/21/2008 4:24:07 PM

S&P affirms AIG ratings, removes from "Watch Negative"

Jeff Bailey : 5/21/2008 4:17:41 PM

FOMC Minutes (04/29/08-04/30/08) at this Link (.pdf)

Linda Piazza : 5/21/2008 4:00:29 PM

An OEX daily chart to consider: Link Barring a strong move down in the last minute or so, I don't consider the support violated yet as the daily close would be just barely below Keltner support and above trendline.

Jane Fox : 5/21/2008 3:58:05 PM

Crude will close today with a high of $133.82. Who would have ever thunk?

Keene Little : 5/21/2008 3:51:42 PM

And that bullish divergence is good confirmation that it's likely the 5th wave down for today's decline (usually see divergence between the 3rd and 5th waves).

Linda Piazza : 5/21/2008 3:50:06 PM

In my 3:29 post, I noted that we might need another downturn with some price/RSI divergence before we believed that much of a bounce could get started. I'm seeing tentative divergences set up on the 15-minute charts for the OEX and SPX with that last thrust lower. Just tentative, though. Nothing to count on yet, but certainly something to watch.

Keene Little : 5/21/2008 3:49:20 PM

Getting the 5th wave down for today's decline. Now is when you want to pull your stops closer if you rode this down. Certainly any rally above the last bounce high after 3:00 PM should have you out (short term traders).

Linda Piazza : 5/21/2008 3:47:06 PM

While I typed that 3:44:26 post, the OEX headed down again. All the suggestions there to consider whether there could be a bounce from the 633-634 zone still apply, but you factor in the thought that the OEX would be ending the day below that potential support zone from 637-641 and so that might be resistance tomorrow. That would be more suggestive of an indecision-type day for tomorrow than if the OEX ends nearer 637-641.

Linda Piazza : 5/21/2008 3:44:26 PM

Time to think about end-of-day decisions. This day has proven that prices can have moved big by the end of the day, but let's make some assumptions. Let's assume that the OEX ends the day somewhere between 647.30 and 640.20. If it does so, it's ending the day or near at all sorts of potential support, including Keltner support and the regular daily chart's 30-sma and 72-ema. It will have probably still maintained a potential downside target that's now at 633.87 but it might have erased its breakdown status on the 15-minute chart.

So, what do you do with your trade? You consider continued vulnerability to 633-634 without counting on it happening. Depending on the degree of the bounce, you consider the possibility that the OEX will bounce within the descending price channel it's been forming all this month, with that bounce beginning anytime now but especially perhaps from the 633 level, if it's touched. Remember that channel could well be a bull flag pullback from the resistance levels that were tested this month.

If the OEX doesn't bounce but instead breaks the support of that channel, it could fall steeply, perhaps as steeply as the 608-610 level, but it wouldn't likely do that at once and it might not do it at all. I rather suspect that we could have a choppy summertime and part of that might begin with an attempt to chop back up through that descending channel that's been in place almost three weeks.

We just don't know right now, but my advice right now is to have what-if plans for a bounce back through that channel, keeping that possibility of a steeper fall on your radar screen.

Keene Little : 5/21/2008 3:34:48 PM

If you look at the move down from this morning's high for NDX (use a 5 or 10-min chart) you can see a 3-wave move down so far, currently bouncing in what looks like a 4th wave correction. Once we get a 5th wave down (and so far it projects to 1941 to achieve equality with the 1st wave down) then look for a bounce back up to correct at least today's decline.

Keene Little : 5/21/2008 3:30:59 PM

I see NDX had dropped down to its 200-dma (1957.57) which is where it bounced. But the bounce looks corrective and will probably drop below it. Just below the 200-dma is the uptrend line from October 2002 (using log scale) and the uptrend line from March, both in the 1930-1940 area. If NDX drops down to those trend lines it could be good for at least a little larger bounce. Daily chart: Link

Linda Piazza : 5/21/2008 3:29:24 PM

So far, the 7-minute 9-ema is holding as resistance for the OEX, but the OEX hasn't turned back from it. For that reason, I'm wondering it it could chop all the way up the 15-minute version, now at 639.18 with further potential reistance at 640.06. We might still need another test of the low complete with bullish price/RSI divergence before we start believing any bounce could last, though.

Jeff Bailey : 5/21/2008 3:20:42 PM

VIX.X 18.47 +5.06% ... did "prarie dog" WKLY R1. Premiums still a bit "low" for selling NAKED puts.

Linda Piazza : 5/21/2008 3:17:25 PM

Be aware that the VIX is approaching potential trendline resistance from the top of a channel in which it's been moving down since about 3/31. It looks as if the VIX, at its high today, hit the top of that channel. This suggests that it's time for the VIX to either breakout to the upside or turn down again through that channel. When I turn to the 30-minute Keltner chart, which works remarkably well for the VIX lately, here's what I see: Link

Jeff Bailey : 5/21/2008 3:09:02 PM

Nice little QM day trade from EIA release.

Jeff Bailey : 5/21/2008 3:05:16 PM

UNG $55.94 +2.19% ...

Jeff Bailey : 5/21/2008 3:04:48 PM

Eur/$ 1.5782 +0.88% ...

Jeff Bailey : 5/21/2008 3:04:12 PM

Swing trade long exit partial alert! ... for the US Oil Fund (USO) at the bid of $107.93.

Reduce to 1/4 position.

Linda Piazza : 5/21/2008 3:03:01 PM

The bond market is closing. Sometimes the tenor of trading changes when it does, with either a reversal of the former move or an acceleration of it. Be prepared, whatever your trade. We can't guarantee that it will happen, but being prepared never hurts.

Linda Piazza : 5/21/2008 3:02:12 PM

The OEX's 7-minute 9-ema is now 637.84; the SPX's 1396.91.

Linda Piazza : 5/21/2008 2:44:17 PM

The move down was so quick that I've scaled down to the 7-minute chart to watch the OEX and SPX. The 7-minute 9-ema is now 639.04 for the OEX and 1400.23 for the SPX.

Jeff Bailey : 5/21/2008 2:44:07 PM

USO $108.13 +3.67% ... X gets another square ($1 box)

Jeff Bailey : 5/21/2008 2:40:03 PM

02:00 Internals at this Link

DXY and CRY quotes were 02:00 (charts slow to load intra-day) sorry for the delay.

Tab Gilles : 5/21/2008 2:41:16 PM

The Nasdaq 100 $NDX has had a nice run over the last 2 months. However, looking at the charts shows that it is currently testing its 20-ema and 200-ma. Link

The 3 leading tech stocks; RIMM looks the strongest, followed by AAPL and GOOG. Research in Motion (RIMM) Link Apple (AAPL) Link Google (GOOG) Link

Linda Piazza : 5/21/2008 2:37:40 PM

I'm glad I decided to go ahead and be a bit of a fearmonger (1:21:22 post), at least warning of the possibility. However, remember that even in that post, I noted the potential support near 637-639 for the OEX, so make sure you keep updating your profit-protecting plans if in bearish trades. I wouldn't use the fact that we've hit that level as a sign that the OEX is definitely going to bounce now and an entry into a long position as there's still a lower downside target that's very much a possibility. This is not the climate today to be jumping into bullish trades willy nilly, or whatever that saying is.

Tab Gilles : 5/21/2008 2:31:46 PM

Weekly EIA Report Link

Linda Piazza : 5/21/2008 2:22:57 PM

The SPX's potential downside target (and support) on the 30-minute chart is now 1382.32, but also be aware of potential support that could kick in at any time from other charts.

Linda Piazza : 5/21/2008 2:22:19 PM

While the OEX now has that 635 (now pushed down to 633.90) potential downside target on the 30-minute chart, be aware of the daily support I mentioned earlier in the 637-639 region. That could kick in at any time. Protect your bearish profits.

Keene Little : 5/21/2008 2:17:00 PM

Using the arithmetic scale the DOW is now back down on its broken downtrend line from October, currently near 12665 (about 12730 using log scale). Its 50-dma is not far below at 12624.

Keene Little : 5/21/2008 2:14:47 PM

Not even the RUTlanders could hold the bears back today, although they certainly made a valiant effort. The RUT is still relatively strong and hasn't yet tested yesterday's low at 730.44.

Jeff Bailey : 5/21/2008 2:05:38 PM

Forex Currencies Live! Link

Jeff Bailey : 5/21/2008 2:04:35 PM

Forex Currencies just ahead of FOMC minutes release Link

Keene Little : 5/21/2008 2:03:00 PM

A break below 12715 confirms a sell signal from the double top on May 2nd and Monday.

Keene Little : 5/21/2008 2:01:43 PM

DOW is now testing its May 9th low near 12715.

Keene Little : 5/21/2008 2:00:52 PM

With the lack of a bigger bounce and now making new lows, this has the potential to get ugly to the downside.

Jeff Bailey : 5/21/2008 1:56:39 PM

10-year up 6.1 bp at 3.837%

Jeff Bailey : 5/21/2008 1:55:35 PM

FOMC meeting minutes set to be released at 02:00 PM EDT.

Jeff Bailey : 5/21/2008 1:54:54 PM

Canada's CPI m/m was up 0.8%, above economists' forecast for +0.4%. Core CPI m/m +0.3% vs. forecast of +0.2%. Data was released at 07:00 AM EDT.

Jeff Bailey : 5/21/2008 1:53:21 PM

Canada's leading indicators m/m also up 0.1%. Data was released at 08:30 AM EDT.

Jeff Bailey : 5/21/2008 1:49:03 PM

Good gravy James! Are you implying that oil prices might be associated with economic growth/stimulus?

Linda Piazza : 5/21/2008 1:48:43 PM

The OEX's potential support is now 641.88-642.04, but that so-called support is still descending right toward next support now at 640.75, so a test of that level can't be precluded. If it is tested, bears should definitely have their profit-protecting plans in place. While a test of 637-639 also remains a possibility, and a test of 635 a perhaps more remote possibility, a bounce could come at any time as this stronger support is tested. For example, the upside of this same Keltner channel was tested and even exceeded on Monday, but we've seen what has happened since as that extreme move was turned around.

Linda Piazza : 5/21/2008 1:45:40 PM

Warh's views on the "decoupling" theory: "What I do believe, however, is that our financial markets at the center of this turmoil have not decoupled, not even a little bit. In fact, our financial institutions and financial markets have never been more integrated." He suggests that policy differences in central banks around the globe "should not be taken lightly." He concluded by suggesting that although the Fed's actions might prove helpful, resolving the difficulties in credit availability and liquidity problems isn't the Fed's responsibility alone. The Fed's repertoire "is imperfectly suited to compensate for declines in liquidity arising from retrenchment in the financial sector for long periods."

James Brown : 5/21/2008 1:42:07 PM

I'm sure it's already been mentioned several times how the government's stimulus package will be overshadowed by the rise in oil and prices at the gas pump. However, about 30 minutes ago, CNBC had a nice graphic that summed it up pretty well.

When the stimulus package was signed back in February crude oil was only $93 a barrel.

Now that checks are finally being delivered to tax payers crude oil is up to $131 a barrel.

Jeff Bailey : 5/21/2008 1:42:20 PM

CNBC reporting that "energy" has now surpassed "financials" for heaviest weighting in S&P 500 (SPX.X) ... It was getting close last week.

Anyhow ... KNOW your index weightings!

Linda Piazza : 5/21/2008 1:41:53 PM

For those hoping the Fed will pull out its economic hammer and pound interest rates down again, Warsh says, "Even if the economy were to weaken somewhat further, we should be inclined to resist expected, reflexive calls to trot out the hammer again." I guess we know where he stands on the dovish/hawkish spectrum, and he did note his expectation that "inflation risks are evident" and "inflation news since last summer offers little solace," going on to say that "[c]oncerns about price stability and concerns about the real economy may conflict with one another in the short run." He thinks that the private financial institutions should hammer out some resolutions.

Linda Piazza : 5/21/2008 1:32:48 PM

Federal Reserve Governor Kevin Walsh's speech begins with the comforting (that's sarcasm, in case you missed it) pronouncement that "[t]his may be the most pronounced time of testing for central banks in a generation." He reassures listeners, however, that "the Fed possesses both the commitment and resources to tackle these policy challenges." He doesn't believe, however, that the Fed has yet "devised error-free policies to painlessly and smoothly achieve agreed-upon objectives" since "the Fed is not omnicient." You can read his prepared statement at Link .

Linda Piazza : 5/21/2008 1:28:43 PM

The OEX has potential support at 641.99-642.32, but it's descending support, so I'm not sure how firm is it.

Linda Piazza : 5/21/2008 1:21:22 PM

I don't like being a fearmonger, especially unnecessarily, but it's time for me to mention another scenario that's been showing up lately. This choppy consolidation feeds into it. The OEX's 10-day chart shows that from about 5/14, it's been setting up a potential H&S. As you know, I don't count on these too-well-recognized formations to prove anything, only to show how sentiment is progressing. This current consolidation that I anticipated (although I anticipated that it would occurring more sideways than sideways-down) is part of the right-shoulder-building exercise. Moreover, on the 30-minute chart, this right-shoulder-building exercise is occurring below the central basis line rather than along it. Now, for two days, the OEX has been consistently finding resistance on the 30-minute 9-ema and turning down from that, with that average now converging with what should have been support but isn't, now at about 644.50 on 30-minute closes.

What has resulted from all that is a potential downside target now of 634.26. I hesitate to mention this because I know some of you grew your trading skills trading the bear markets of 2001-2002 and you feel more comfortable with the sharp downside moves. I don't want you to be entering trades with the expectations that the OEX will definitely fall to 634 or even the 637-639 range that the daily charts suggest is possible. I want you to adhere to your own trading rules. Neither do I want bulls bailing wholesale out of their trades in fear that this scenario will come to fruition if their trading parameters are still okay, although I personally wouldn't be long right now. What I do want is for bulls and bears both to factor in vulnerability to that level without counting on it occurring. If I were in any unhedged trade right now that was dependent on a particular direction, I'd be aware that the FOMC minutes could undo anything that's showing up on the intraday charts, even the 30-minute one. I'd be aware of that H&S and that downside target, but I'd sure keep in mind that this has been a climate lately in which bearish setups don't often act as expected.

Jane Fox : 5/21/2008 1:17:33 PM

Doesn't this chart just leave your mouth gaping. Link

Keene Little : 5/21/2008 1:13:49 PM

Gold just made a new high and now has a 5-wave move up from this morning's low. It looks good for another attempt at a short play with a stop at 934. Keeping the stop relatively tight to see if resistance at 932 holds.

Linda Piazza : 5/21/2008 1:09:38 PM

The OEX continues to chop a little higher in its up and down sideways/sideways-down consolidation pattern. What's support and what's resistance in a pattern like this? So far, the 45-ema now at 646.66 has been resistance and the support now at 642.66-643.03 has been support on 15-minute closes for the most part, but that's about the best we can do. I thought beginning about midday on Tuesday that we were heading into a possible several-day period of chopping consolidation. I had thought the chop would be a sideways one and not a sideways-down one, but the outcome is still the same. While adept scalpers have had some good opportunities to make money in this chop, it's been tough for most.

Jeff Bailey : 5/21/2008 1:09:36 PM

Most Actives ... QQQQ $49.07 -0.40%, INTC $23.85 -0.99%, SPY $141.27 -0.43%, XOM $95.96 +1.48%, WM $9.49 -3.45%, MSFT $28.80 +0.13%, SOLF $27.04 +7.13%, MU $8.46 +3.04%, CSCO $25.71 -0.54%, YHOO $27.30 -0.69%

Jeff Bailey : 5/21/2008 1:00:49 PM

USO (updated) ... daily interval bar chart. Have added the YRLY R2, and stacked the initial "Bailey Wave" Link

Jeff Bailey : 5/21/2008 12:58:06 PM

Stillwater Mining (SWC) $15.96 +6.11% ... comes to trend.

Jeff Bailey : 5/21/2008 12:55:46 PM

USO $107.04 +2.62% ... X gets another square.

Linda Piazza : 5/21/2008 12:54:09 PM

Remember the Fed speaker Warsh (11:53:16 post) begins speaking in a few minutes and his prepared remarks should be available any time. There is expected to be a Q&A session. The FOMC minutes follow at 2:00 pm ET. I don't know if anything market moving will occur as a result of either, but they could, so make your what-if plans now if you haven't already.

Linda Piazza : 5/21/2008 12:51:48 PM

The TRAN is certainly just chopping around over the last couple of days. This morning, pre-inventories-release, it spiked higher and then post-release, it dipped lower, but mostly it's held to a band from about 5335 to 5380. It's 5367.81 as I type, so this isn't giving us any information. It's certainly not following the track of another indicator-type index for those who watch many sectors, the RUT, which has been attempting to lead the way higher today, if in a somewhat jerky fashion. The SOX is like the TRAN, not doing much of anything except consolidating sideways, although there's a bit of a hint of a sideways-up trend. The BIX counters that with its sideways-down or rather, down-sideways trend, and the RTH, representing the retail sector, mostly just goes sideways. So, we have mixed evidence from these various indicator indices, but taken all together they just spell consolidation.

Jane Fox : 5/21/2008 12:51:00 PM

So much for my prediction that Gold was going to slow down. It has just added another $4.00 today. Link

Jeff Bailey : 5/21/2008 12:47:50 PM

VIX.X 17.03 -3.12% ...

Jeff Bailey : 5/21/2008 12:47:38 PM

Swing trade NAKED call buy back alert! ... the two (2) S&P Depository Receipt SPY June $148 Calls (SFB-FR) at the offer of $0.33.

SPY $141.69 -0.14% ...

Jeff Bailey : 5/21/2008 12:45:51 PM

USO's $1 box chart has bullish vertical count to $129. Link

$0.50 to match futures Link ... would be under construction to $124.00.

Jeff Bailey : 5/21/2008 12:43:11 PM

Upper end of stacked "Bailey Wave" at $112.

Jeff Bailey : 5/21/2008 12:42:46 PM

USO's 2007 year high/low/close was $77.59/$42.56/$75.76.

No help expect for support ... YRLY Levels would be $30.27, $53.02, Piv= $65.30, $88.05, $100.33.

Jeff Bailey : 5/21/2008 12:33:30 PM

About all we can do for further upside target on USO is use the stacked "Bailey Wave" we used for gold several months ago. USO above QRTR R2 and MONTHLY R2. Haven't run a YRLY Pivot. Will do!

Linda Piazza : 5/21/2008 12:25:59 PM

If the A/D line drops below about -260 and stays below that, then that supports the idea of a trending move more than a choppy one. Don't get me wrong: it's still possible that the OEX could resolve any choppy consolidation by a downturn, so I'm not saying that if we have choppy consolidation today that's necessarily bullish. So far, we've had choppy consolidation but it's been of the sideways-down variety, not a complete sideways move. If the A/D line drops below that -260 level, though, the move might resolve into a sharper downturn. I don't have a similar upside benchmark to watch for a sign that the OEX and other indices are going to take off to the upside.

Keene Little : 5/21/2008 12:17:32 PM

In order to achieve the scenario I was thinking about for SPX (rally up to the 1424-1425 area), the bounce off this morning's low needs to be a sharp rally (wave-c of an expanded flat a-b-c bounce off yesterday afternoon's first low). But so far it's hardly inspiring. The NDX looks downright bearish in its puny little bounce attempt. At this point, if forced to trade, I'd want to be long off this morning's low but then switch to the short side with a drop to a new low.

Jeff Bailey : 5/21/2008 12:14:31 PM

12:00 Internals at this Link

Linda Piazza : 5/21/2008 12:13:30 PM

The OEX's 15-minute 9-ema is now at 644.45; the SPX's, 1412.20.

Linda Piazza : 5/21/2008 11:53:52 AM

I'm reading a report that Fed Governor Kevin Warsh speaks today at 1:00 pm ET in Washington, D.C., with the title of his speech to be "Using the Federal Funds Rate in Extraordinary Times." That's going to be an interesting talk, given this week's inflation data, isn't it? Just be aware that this comes before the 2:00 release of the FOMC minutes, so if he says something that rattles markets they may start a reaction before the minutes are released. I'm not familiar with Warsh, not sure if he's a voting member or not, whether he tends to be dovish or hawkish.

Linda Piazza : 5/21/2008 11:46:56 AM

The 15-minute 9-ema is still resistance, and in fact, a lower Keltner line now at 643.89 appears to serving as resistance on 15-minute closes. Light support at 642.88 and then at 640.91 on 15-minute closes.

Keene Little : 5/21/2008 11:42:51 AM

If the market can rally back up, I see the potential for SPX to make it up to the 1424-1425 area where a Fib projection meets the 50% retracement. The bullish sentiment in the RUT needs to rub off on the others.

Linda Piazza : 5/21/2008 11:30:10 AM

The OEX's 15-minute 9-ema hasn't been a spectacular benchmark today, one of the actions that supported the idea that we might be in for some chop today. However, now we should watch it again to see if it's resistance on 15-minute closes, to determine if this has become a trending move or if the chop zone is just a bit broader than anticipated. That's now at 644.74 with the OEX at 644.29 as I type.

Linda Piazza : 5/21/2008 11:28:18 AM

The TRIN is headed down toward potential support near 1.25 and then near 1.10.

Jeff Bailey : 5/21/2008 11:27:54 AM

AMEX Airline Index (XAL.X) 19.82 -6.72% ... undercuts its 04/23/08 low.

Linda Piazza : 5/21/2008 11:15:17 AM

We're seeing more of a trending move than I expected. The potential OEX target was there but there was enough support between it and that to question whether it would be reached. In addition, the A/D line's actions were strong enough to support the possibility of chop, until a few minutes ago when it dropped through the day's low and to potentially stronger support at about -100. It's now -105, testing that.

The next target for the OEX is now 641.05 if the support level near 642 craters. I would have profit-protecting plans in place if 641 is tested, but I'm still not sure it will be.

If it is, bulls want to see that level hold up as support because a trip down to 638-640 can't be precluded if it doesn't.

Keene Little : 5/21/2008 11:14:26 AM

Well the RUTlanders have joined the bear party and dropped into the red. Oops, back in the green. OK, flat. If you're in a dip-buying mood you know which one to buy.

Keene Little : 5/21/2008 11:07:03 AM

DOW is down 90 points and the RUT is still in the green. Amazing. No fear in RUTland.

Jane Fox : 5/21/2008 11:06:38 AM

Crude seems to have topped out at $132.08.

Keene Little : 5/21/2008 11:05:40 AM

Gold is now making a new high as well (with oil) so now watch to see if it tags the Fib projection near 932 (928 so far).

Jane Fox : 5/21/2008 11:04:12 AM

Crude is now up to $131.53 and climbing.

Jeff Bailey : 5/21/2008 11:00:10 AM

Very weak purchases in the MBA report.

Jane Fox : 5/21/2008 10:55:14 AM

$130.80

Jane Fox : 5/21/2008 10:54:41 AM

Now at $130.60 and climbing.

Jane Fox : 5/21/2008 10:53:39 AM

Crude is back testing all time highs at $130.47

Keene Little : 5/21/2008 10:53:13 AM

The DOW and SPX are breaking down further while the RUT holds onto its gains. It's hard to get either bearish or bullish right here. It's like looking both ways for traffic and still getting hit because you forgot to look up.

Jeff Bailey : 5/21/2008 10:52:51 AM

Sector Losers ... Airlines -5.36%, Home Construction -2.00%, Broker/Dealers -1.21%, Semiconductors -0.79%, Biotechnology -0.77%

Linda Piazza : 5/21/2008 10:52:17 AM

The SPX has potential support on 15-minute closes perhaps firming up near 1409.33-1410.67.

Linda Piazza : 5/21/2008 10:51:25 AM

The VIX is just chopping around near the bullish/bearish benchmark on its 15-minute chart. It's not giving us any short-term predictions as long as it behaves this way.

Jeff Bailey : 5/21/2008 10:51:24 AM

Sector Gainers ... HMO's +3.14%, Healthcare +1.17%, Gold Bugs +0.97%, Utilities +0.91%

Linda Piazza : 5/21/2008 10:50:28 AM

The last OEX 15-minute close was beneath the 15-minute 9-ema and now the OEX tests potential support (but descending support) at 645 on 15-minute close and just above that on 30-minute closes. While the potential for the OEX to slide right on down to 643.60 and maybe even now to 641.25 remains, the setup sure isn't promising that those lower targets will be reached.

Jeff Bailey : 5/21/2008 10:48:46 AM

MBA's Weekly Application Survey at this Link

Keene Little : 5/21/2008 10:40:16 AM

A couple of minutes ago we had a quick spike down in equities and a quick spike up in oil and gold. The crude inventory (10:30 report) showed a big drop so perhaps the spike in crude is what spooked the equity market (and fear of more inflation spiked gold). Only oil is seeing a little follow through on the spike.

Keene Little : 5/21/2008 10:35:51 AM

Kind of a strange day so far with the DOW down the same amount as the RUT is up. That kind of split is not normally a healthy sign for the market but for now it just means chop.

Jeff Bailey : 5/21/2008 10:34:57 AM

Will use the one (1) IYS-RR (USO Jun $96 Put) from 5/15/08 as protective for now.

Jeff Bailey : 5/21/2008 10:33:05 AM

Swing trade long alert! ... for 1/2 position in the US Oil Fund (USO) $105.22.

Jeff Bailey : 5/21/2008 10:31:11 AM

Most Actives ... SOLF $27.29 +8.08%, QQQQ $49.30 +0.06%, SPY $141.82 -0.04%, PFE $20.03 -0.09%, MSFT $28.76 (unch), C $21.82 -1.31%, SLM $22.25 +7.07%, PBR $76.30 +2.99%, INTC $24.00 -0.37%, QCOM $47.00 +2.01%

Keene Little : 5/21/2008 10:25:01 AM

Silver has been underperforming gold (for a long time actually) and SLV shows a little more upside potential to just shy of 177 (today's high so far is 175.77) where it would bump into its broken uptrend line from August 2007. At 176.72 its bounce from May 1st would have two equal legs up. So like gold I see a good short play setup on silver. Silver should outperform to the downside, assuming it will decline. Link

Linda Piazza : 5/21/2008 10:23:02 AM

The TRIN, at 1.49, is still near the high of the day, but if this were an equity and I were looking at its 15-minute chart, I would think that it needed to pull back, at least to 1.43 and maybe deeper. For now, though, I don't see any promise that it will fall deeper than that, just the possibility. Note: As I typed, the TRIN dropped to 1.44 and is now back to 1.47.

Linda Piazza : 5/21/2008 10:21:13 AM

So far, the A/D line is holding above potential support on 15-minute closes near 230, with the A/D line at 578 as I type. So far, though, it's jut chopping within the first 15-minute range, from 307 to 1243. Nothing very predictive there.

Jeff Bailey : 5/21/2008 10:19:39 AM

10:00 Internals found at this Link

Jane Fox : 5/21/2008 10:19:11 AM

I see the S&P futures (ES) making new daily lows but the VIX is not making new daily highs. This is pretty odd.

Jane Fox : 5/21/2008 10:18:06 AM

TRIN is up to 1.51 and that should be very worrisome to the bulls.

Linda Piazza : 5/21/2008 10:03:50 AM

A/D line falling sharply from its approach to resistance. If you read my 9:32:59 and 9:44:07 posts, you know I'm not surprised to see the indices having headed up first thing or then to stall where they did. If I suspected that, what do I suspect now? Unfortunately, what I expect now is chop, with the possibility that either in anticipation of or after the afternoon's release of the minutes, that some movement might start, but which direction, I don't know. I don't consider the current setup good for trading, unfortunately.

Jeff Bailey : 5/21/2008 10:00:37 AM

iShares Silver (SLV) $175.58 +0.33% ... ~17.55 spot.

Jeff Bailey : 5/21/2008 9:58:18 AM

StreetTracks Gold (GLD) $91.02 +0.13% ... ~910.20 spot.

Jeff Bailey : 5/21/2008 9:57:39 AM

US Dollar Index (DXY) 72.16 -0.33% (30-minute dealyed) ... has fallen below its MONTHLY Pivot.

Jane Fox : 5/21/2008 9:55:35 AM

Dateline WSJ - American Airlines said it plans to cut domestic capacity by 11% to 12% this year on rising fuel prices and the weakening U.S. economy.

Keene Little : 5/21/2008 9:51:20 AM

If the bounce is to be a correction of the decline from Monday then it could be a choppy affair and take most of the morning. Obviously a bounce followed by a drop below yesterday's lows would be bearish. If we get a sharper rally, especially above a 62% retracement (DOW 13001, SPX 1428.32) then I'd start to think a little more bullishly.

The RUT continues to act more bullish, up nearly +1% already this morning and it has rallied above the 62% retracement (741.29). The RUT can be whippy so I want to see a new high (above 748) before turning bullish, or at least more cautious.

Linda Piazza : 5/21/2008 9:48:45 AM

The A/D line is still climbing strongly, but now it's approaching potential resistance at 1464. It's currently 1243. If it's gains get capped, then it's possible that those on equities will be, too.

Jane Fox : 5/21/2008 9:48:08 AM

I just wanted to remind everyone I am taking this week off but I am still at my desk so will be popping in every once in a while.

Keene Little : 5/21/2008 9:46:11 AM

I had mentioned a possible DOW retracement of 12920-12960 and the equivalent retracement for SPX (38%-50%) would be 1421-1424.65.

Jane Fox : 5/21/2008 9:44:41 AM

As far as the VIX and AD line are concerned the bulls have the ball but the TRIN disagrees at 1.24.

Linda Piazza : 5/21/2008 9:44:07 AM

The SPX has again been looking stronger than the OEX on a Keltner basis and has already moved up into and through a potential resistance band from 1417-1418.65 on 15-minute closes. This also looks like potentially strong resistance, but in the SPX's case, perhaps only strong enough to stall the SPX for a while, while the SPX shoves that resistance band a bit higher and while we wait and see what happens next. I would not be surprised to see gains capped either not too far from where the SPX is now, or, if it does get higher, near 1423-1424.

Linda Piazza : 5/21/2008 9:41:11 AM

The OEX is now testing that resistance zone I mentioned earlier, with the move higher having shoved that zone up to 646.70-646.90. The OEX is 646.81 as I type, with next potential resistance above this at 648.40-648.89 on 15-minute closes and a bit lower on 30-minute ones. Before we start looking too strongly at next resistance, though, let's make sure the OEX can push past this band on a 15-minute close.

Keene Little : 5/21/2008 9:35:12 AM

If gold manages to push higher again I'll be watching the Fib projection at 931.84 for a possible top.

Linda Piazza : 5/21/2008 9:34:33 AM

Keltner outlook on the A/D line: The A/D line has jumped into the bullish half of its 15-minute Keltner channel, above potential resistance now at 144 on 15-minute closes. Now bulls don't want to see it fall back below that before the close of this first 15-minute period. The A/D line is now 522.

Keene Little : 5/21/2008 9:32:26 AM

As I suspected would happen, gold made its high during the overnight session and tagged monthly R1 (926.00) and the top of a parallel down-channel for price action since the April 1st low. Gold has since dropped about $8 this morning from the overnight high. I like a short on gold against the high (927.70, June contract). Link

Linda Piazza : 5/21/2008 9:32:59 AM

Futures are near flatline levels this morning, and European markets are mixed. The USDJPY kind of chopped around overnight. None of that gives us much of a prediction for action this morning and the OEX ended the day in kind of funny spot yesterday on charts all the way from 15-minute to daily. For example, the OEX managed to scramble back above potential support on the 30-minute chart at 645.50, but it couldn't break back above the 30-minute 9-ema, now at 646.05. It scrambled back above the 15-minute 9-ema, also now about 645.50, but it couldn't get above what may be strong resistance at 646.60 on 15-minute closes.

That chart suggested that the OEX might attempt a climb toward 646.60, but that it might again stall there and might still have in place a 641.60-642-ish potential downside target if it can't scramble above 646.60 and stay there.

The short-term setup then is that the OEX needs to maintain 15-minute values above 646.60 before it even begins to improve its tenor.

Jane Fox : 5/21/2008 9:28:08 AM

Gold has had a very nice run but now the age old question is where does one take profits. My target is the 940-960 resistance but this run has been so nice it is hard to just sit here and wait for that target. I have multiple positions so I may just take 1/2 off here and leave the rest. Link

Jane Fox : 5/21/2008 9:18:20 AM

Overnight futures were flat which is phenomenal considering Crude hit $130.00/bl overnight. Link

Jane Fox : 5/21/2008 9:15:10 AM

So much for my theory that Crude was going to take a 3 day breather. Crude hit $130.47 overnight. Link

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