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Keene Little : 6/13/2008 12:34:16 AM

Friday's pivot tables: Link and Link

At the end of the day Wednesday I thought the stock market was set up for a rally on Thursday so the gap up open in the morning came as no surprise. What did surprise me was the fact that it was all given back by the end of the day, except for a saving bounce into the close. So once again it looks set up for a rally on Friday and this time it should stick. If the market declines instead then the price pattern will turn very bearish, one could say mega bearish or perhaps even uber bearish.

So the bulls need to do their thing Friday morning and get this puppy rallying. I showed the DOW's monthly chart in tonight's newsletter and its very long-term uptrend line from 1974. It's where the DOW found support Wednesday and Thursday and it needs to hold: Link

Right now the DOW is in a tight parallel down-channel from the May 19th high and as the 60-min chart shows, it might be in a bullish descending wedge. If so it's pointing to a big rally leg back up. But first the bulls need to break above the downtrend line near 12360, more than 200 points higher: Link

The NDX, the weaker index lately, is also in a potential descending wedge with confirming bullish divergences. A rally above Thursday's high near 1954 should be confirmation that a bottom is in and then it will be a matter of identifying how strong the bounce could become. 60-min chart: Link

OI Technical Staff : 6/12/2008 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The Market Monitor has been archived.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 : 6/12/2008 9:44:00 PM

China yuan central parity rate set at 6.9018.

Back on 07/21/05, China freed the yuan from its long-standing peg to the dollar in favor of a trade-weighted basket of currencies, similar to the DXY here in the states, and allowed the yuan to appreciate by 2.1%. The People's Bank of China allows a trading band of 0.5% on either side of the central parity rate.

Jeff Bailey : 6/12/2008 9:39:13 PM

Nikkei-225 shedding gains ... up 8 at 13,897

Jeff Bailey : 6/12/2008 9:26:57 PM

Cabot Oil & Gas (COG) $65.77 -4.68% and Massey Energy (MEE) $76.07 -1.07% are being added to the S&P 500 Index, effective after the close of trading June 20.

Cabot replaces Brunswick (BC) $13.08 +1.16%, while Massey replaces Office Max (OMX) $18.12 +0.77%. OMX will move into the S&P SmallCap 600, replacing Massey.

Jeff Bailey : 6/12/2008 9:17:43 PM

Petroleo Brasileiro (PBR) $66.51 +0.49% ... ticked $68.00 extended after saying it has discovered light oil in the Santos Basin BM-S-9 Block. This is near the Carioca discovery.

Jeff Bailey : 6/12/2008 9:15:31 PM

Japan's Economic Minister saying outlook for US economy still uncertain.

Jeff Bailey : 6/12/2008 9:02:31 PM

Here's the IWM's Link

Jeff Bailey : 6/12/2008 9:01:23 PM

DIA's "Max Pain" looks more like $124.00 to me ... DIA Options Montage (OI at Wednesday's close) Link

Jeff Bailey : 6/12/2008 8:41:39 PM

Nikkei-225 ($NIKK) Link ... currently up 96 points, or +0.69% at 13,984. Session low has been 13,977 and high has been 14,013. If we don't see a trade at 13,800, then 3-box reversal to 14,000.

With the Yen flashing some "sell signals" and easing against the $, the $NIKK should start to firm.

FXY 0.50-box to match futures Link

Jeff Bailey : 6/12/2008 8:18:19 PM

Closing Internals found at this Link

Jeff Bailey : 6/12/2008 8:01:49 PM

Peru's Central Bank Increases Reference Rate to 5.75%

Jeff Bailey : 6/12/2008 5:05:39 PM

Good gravy! ... the amount of PUT open interest on the IWM vs. CALL open interest is staggering.

Jeff Bailey : 6/12/2008 4:56:08 PM

"Has to be" Op-Ex related and exercising of some options.

Jeff Bailey : 6/12/2008 4:51:02 PM

More blocks crossed in the IWM ... 2,003,959 at $71.75. 5,006,097 at $71.75

Jeff Bailey : 6/12/2008 4:45:43 PM

Anheuser Busch (BUD) $61.40 +5.22% ... slips to $60.00 extended.

Jeff Bailey : 6/12/2008 4:41:56 PM

Most Actives ... QQQQ $47.41 +0.06%, XLF $23.02 +2.72%, YHOO $23.52 -10.05%, MSFT $28.24 +4.12%, WM $6.64 +9.57%, C $19.89 +3.53%, GE $29.05 -2.61%, SPY $134.45 +0.38%, IWM $72.02 +0.20%, INTC $22.05 +1.10%

Jeff Bailey : 6/12/2008 4:41:52 PM

My QChart's IWM Up/DnTick vol on IWM was Up=2.67 and Dn=1.015

Jeff Bailey : 6/12/2008 4:41:47 PM

Both juuuuust UNDER your conventional 38.2%, and June "Max Pain" theory.

Jeff Bailey : 6/12/2008 4:33:37 PM

Seeing two (2) pretty large blocks of IWM crossed.

1) 2,002,439 @ $71.75

2nd) 1,500,000 at $71.91

Jeff Bailey : 6/12/2008 4:21:13 PM

US Air (NYSE:LCC) $2.69 -15.93% ... light extended tick to $2.86 extended.

Jeff Bailey : 6/12/2008 4:19:55 PM

US Airways announcing major changes, restructuring.

Jeff Bailey : 6/12/2008 4:19:14 PM

Nigeria's President pledges to "double oil production by 2010"

Jeff Bailey : 6/12/2008 4:17:46 PM

Microsoft confirms it wasn't interested in rebidding for Yahoo!

Jeff Bailey : 6/12/2008 4:14:29 PM

Hmmmm ... FCX $117.47 -2.18% Link ... look familiar?

Jeff Bailey : 6/12/2008 4:08:45 PM

Wow ... check out all the info from 04/29/08 ... that's the day we entered the RIO-UG (03:07:18 PM EDT). Link

I see PNRA, I see Sep. Copper, I see Eur/$, I see VIX.X 19.94, I see Banco Bradesco (BBD), I see EWZ

Keene Little : 6/12/2008 4:05:13 PM

As with yesterday the market is on the edge of the cliff here but is set up for a rally. If today's decline was a bear trap we'll probably start tomorrow with another gap up but this time hold, and then run higher into opex. I had mentioned with last night's chart that the DOW sits on its very long term uptrend line from 1974, where the January and March lows found support. If they can't bounce it here, look out below.

Jeff Bailey : 6/12/2008 4:02:42 PM

VIX.X 23.36 -3.15% ...

Jeff Bailey : 6/12/2008 4:02:05 PM

RIO $34.42 -0.05% ...

Jeff Bailey : 6/12/2008 4:01:52 PM

Close out alert! ... the RIO-UG at the bid of $3.30

Jeff Bailey : 6/12/2008 4:00:44 PM

Good gravy ... while I was working on USO chart, RIO did indeed trade that "bad tick" from Tuesday of $34.18.

Linda Piazza : 6/12/2008 3:59:38 PM

Also, for whatever it's worth, today's daily candle on the OEX is likely to be a potential reversal signal, a small-bodied candle or actual doji with a long upper shadow. Reversal signals don't guarantee reversals, but this one is being produced very near the weekly 200-sma, so think about it a bit before you carry home too much bearish risk.

Linda Piazza : 6/12/2008 3:58:15 PM

For whatever it's worth, for the first time today, the OEX is now maintaining values above the 10-minute 9-ema, if only for a few minutes so far. That average is now 609.60.

Linda Piazza : 6/12/2008 3:57:09 PM

I kept meaning to mention all day that today the OEX was testing the weekly 200-sma, now at 612.10. I've been mentioning it all week but forgot to give its current level today. I understand that the OEX is currently below that average, but since this is a weekly average, I will be watching for the weekly close and not the daily one.

Linda Piazza : 6/12/2008 3:55:26 PM

The VIX is currently 23.48. It punched higher when indices punched lower, but so far from Friday through today, each index move to a lower low is accompanied by a lower high on the VIX, not a higher high. Whle it's possible to argue that the VIX's formation is a bull flag pulling back from resistance and it may well be so, that's still so far a tentative bullish divergence and is one reason behind my skepticism about an absolute breakdown this week. I guess it could be argued that this has been a breakdown, but it's not anything of the magnitude that it could have been and might one day be. I've been working on the possibility that what's happening now is that the OEX and other indices are hammering out the parameters for a trading range for the summer, so I'm still seeing if that's what will happen, and still wondering if support won't catch hold soon. We'll see. This is just a scenario against which I'm testing the action and far from any kind of prognosis.

Jeff Bailey : 6/12/2008 3:49:10 PM

Those that took the CAL-FV trade from 05/29 entry and 5/30 exit ... KNOW CAL can trade $13.95.

Keene Little : 6/12/2008 3:47:49 PM

This afternoon's decline is a bit of a waterfall so the downtrend lines are getting steeper. But pick one to determine where you want to place your stop (how much do you want to give back). I'm still harboring thoughts that today's decline is going to get reversed again heading into tomorrow and next week. Getting a bounce as I type--we'll see if it holds or is just a stop run.

Linda Piazza : 6/12/2008 3:46:49 PM

No change in tenor with the market-on-close orders.

Do be aware of the very important developments tonight and tomorrow morning, and make decisions about how much risk you want to take home overnight. See my 3:38:15 post for a list.

Jeff Bailey : 6/12/2008 3:46:22 PM

CAL's June "Max Pain" Theory tabulation as of last night was $17.50 ... $2.50 inc. I'm not shooting for that. $14 to $15 would be nice. And the sooner the better.

Jeff Bailey : 6/12/2008 3:43:26 PM

For those that might want to see what happens overning, and at tomorrow's cash open, today's HIGH on the CAL-GV was $2.20.

So, traders can make some type of decision on if it is worth the wait, or not. May only be RISKING an opportunity of $2.20 entry.

Linda Piazza : 6/12/2008 3:41:51 PM

Because it's been the tests of the 10-minute 9-ema that have driven the OEX lower all day, I keep alternating between the charts. Since the OEX is rising currently, although tepidly, I'm looking to the 10-minute chart for possible resistance on 10-minute closes. That's at 608.53 and then at the 10-minute 9-ema now at 609.35, and the OEX has to get above those and sustain values above them before it even begins to change its short-term tenor. Bears, though, you've read my warnings, so keep updating those profit-protecting plans.

Jeff Bailey : 6/12/2008 3:39:04 PM

Idea, or thought process behind a CAL July $12.50 Call is that a trader is RISKING $1.75, or $175.00 /contract.

Here's the USO and we've had reports that it is hard to find any shares to short (RISK/Acct. management warns against shorting oil anyway with no overhead supply).

Euro is once again at "key level."

USO 10-minute interval chart Link

Linda Piazza : 6/12/2008 3:38:15 PM

For those making end-of-day decisions, what happens tonight and tomorrow morning? You already know some of it. I've been talking for several days about the Bank of Japan decision due tonight. In addition, Japan's Industrial Production and Household Confidence numbers will be released at 12:30 am and 1:00 am ET, respectively. Germany's CPI will be at 2:00 am ET, and some feel that Germany's economy is the one that's driving the ECB decisions these days as Spain and Italy are certainly showing some weakness. Then tomorrow morning at 8:30 am ET, we get CPI, definitely potentially market moving, followed shortly by the Preliminary Michigan Sentiment number at 9:55.

Keene Little : 6/12/2008 3:35:25 PM

SPX did a little catching up to NDX on that last thrust lower, breaking its daily low as well. Watch for a bounce to find resistance at yesterday's low now. The DOW held yesterday's low (minor break). There are hints of bullish divergence if the double bottom holds.

Linda Piazza : 6/12/2008 3:32:31 PM

Rolling back up to the 15-minute chart for next targets. The next potential downside target on the 15-minute chart has been reached, with that at 607.40 on 15-minute closes. If this doesn't hold, 604.89. Again, it seems silly to do so, but I continue to caution bears to have their profit-protecting plans in place as there are signs of improvement. Price might be lower, but the Keltner levels being tested are . . . shall we say a "degree" higher? This is Keltner-style bullish divergence. No divergences guarantee price action, but they certainly caution that you need to have what-if plans in place.

Linda Piazza : 6/12/2008 3:24:27 PM

The TRIN bounced, closing the first 10-minute period of the day above the 10-minute 45-ema now at 0.84. It faces stronger resistance up to 0.91, and so isn't moving too far and in fact, keeps dropping back to 0.84 to retest it. It's at 0.85 as I type.

Linda Piazza : 6/12/2008 3:17:25 PM

Bears, the OEX still hasn't been able to close 10-minute periods above its 10-minute 9-ema, now at 610.62, but the support now at 608.60-608.91 appears to be firming a bit. I guess we'll soon see since the OEX is headed straight down to test it. I would still know how I intended to protect my profits, however, as there are some slight signs of improvement.

Jeff Bailey : 6/12/2008 3:15:03 PM

Seeing some headlines from 11:41 AM EDT out of OPEC. OPEC believes crude supply tops current demand. No need to increase output.

USO was trading $107.66 at that time.

Jeff Bailey : 6/12/2008 3:11:30 PM

Yahoo saying it had meeting with MSFT as recent as 06/08/08. MSFT wasn't interested in pursuing acquisition of all of company, even at previously suggested price.

Jeff Bailey : 6/12/2008 3:10:07 PM

Yahoo saying "search-only" deal not in best interest of shareholders.

Linda Piazza : 6/12/2008 3:07:01 PM

The OEX's 10-minute 9-ema is now 610.62. The OEX is 610.04 as I type.

Linda Piazza : 6/12/2008 3:02:11 PM

The 3:00 period sometimes signals a change in tenor, so be prepared just in case.

Linda Piazza : 6/12/2008 3:00:54 PM

The TRIN again found resistance where it's been finding resistance today on 10-minute closes, at a Keltner line now at 0.84. Bears don't want it close this 10-minute period below the 10-minute 9-ema. That would be a first 10-minute close beneath the 10-minute 9-ema all day, with that moving average now at 0.81 and the TRIN now at 0.80.

Linda Piazza : 6/12/2008 2:58:29 PM

The OEX's 10-minute 9-ema is now 610.71.

Linda Piazza : 6/12/2008 2:57:51 PM

The OEX is again hitting and again attempting to steady at the support on the 10-minute chart, with that now at 608.97. It may seem silly, but I'd still cautious bears to be careful here.

Jeff Bailey : 6/12/2008 2:55:27 PM

MSFT's June "Max Pain Theory" tabulation is $29 ... $1 inc.

Jeff Bailey : 6/12/2008 2:53:56 PM

MSFT $27.60 +1.73% ... could find a bid if deal with YHOO off.

Jeff Bailey : 6/12/2008 2:53:31 PM

Yahoo! (YHOO) $23.38 -10.59% ... on CNBC reports of GOOG/YHOO advertisement deal.

Linda Piazza : 6/12/2008 2:53:18 PM

The TED spread is now 0.80, still not climbing although it's also not retreating much, either. I looked at another measure of the credit problem's legacy, the outstanding corporate paper figures published weekly by the Federal Reserve. Commercial paper is used by corporations to obtain short-term funding less expensive than what they'd obtain otherwise. Through the week ending yesterday, those outstandings had risen a seasonally adjusted $16.4 billion, with financials apparently able to place paper, even $8.5 billion in asset-backed paper.

Jeff Bailey : 6/12/2008 2:52:55 PM

Oh my ...

Jeff Bailey : 6/12/2008 2:51:26 PM

US House Passes Unemployment Insurance Benefit Extenstion.

Jeff Bailey : 6/12/2008 2:50:44 PM

02:00 Internals found at this Link

Keene Little : 6/12/2008 2:50:10 PM

Any bounce back above the bounce highs near 2:15 PM would likely indicate a bottom is in for the day. Until then the pattern has turned bearish so stick with the short side.

Keene Little : 6/12/2008 2:48:34 PM

NDX is the first of the four indexes into the red and it has the potential to waterfall lower as selling accelerates.

Linda Piazza : 6/12/2008 2:45:20 PM

The OEX has hit its downside target on its 10-minute Keltner chart, mentioned earlier. What next? It has to maintain values above that thin red 9-ema before even the very short short-term tenor begins to change: Link

Linda Piazza : 6/12/2008 2:42:31 PM

It looks to me as if the TRIN faces resistance on 10-minute closes at 0.85 and has potential support on 10-minute closes at 0.80. Both those have been holding on 10-minute closes since the second 10-minute period of the day. One has got to break eventually, so we may be close to a turning point. Bulls and bears both should be careful. If the TRIN breaks higher on 10-minute closes, it looks as if it could move up toward 0.91 before facing next resistance with that being short-term bearish for equities. If it loses support, it looks as if it could run down toward 0.73, with that being short-term bullish for equities. It's at 0.83 as I type.

Keene Little : 6/12/2008 2:39:28 PM

AAPL has now dropped below its 50-dma so not much of a bounce off it. It could still be just a throw-under but clearly things are starting to look a little bleaker for the bulls if the market can't bounce back up here.

Linda Piazza : 6/12/2008 2:36:58 PM

If I were hoping for a bullish resolution today, I wouldn't want the VIX to get much above its current 23.41 level and certainly not much above about 23.85, and really, really not above about 24.15. Smile. Also those mark various descending trendlines.

Linda Piazza : 6/12/2008 2:32:09 PM

Potential support on 10-minute closes for the OEX is now 609.20. The 10-minute 9-ema is now 611.91 and, once again, the OEX couldn't maintain levels above it. So far, it maintains the short-term vulnerability to 609.20, but I would be careful from this point forward if in bearish posisions because there's the potential for support to kick in again at any time. That's not a given, since I really can't read any preference for any particular scenario in the charts today.

Jeff Bailey : 6/12/2008 2:31:17 PM

FXE $154.41 -0.86% ...

Jeff Bailey : 6/12/2008 2:30:57 PM

CAL $12.50 +3.30% ...

Jeff Bailey : 6/12/2008 2:30:20 PM

USO $110.84 -0.13% ... comes to MONTHLY R1 ... again.

Linda Piazza : 6/12/2008 2:29:46 PM

The OEX has found support at top trendline of the descending channel in which the OEX moved lower yesterday afternoon. See my 1:52:19 post for an explanation. When there's a breakout above a descending trendline, we can often expect a retest, and bulls want that former resistance line to hold as support on the retest. So far, so good, but the OEX hasn't gone far yet. It needs to break above this morning's high before it confirms that the support held, and I don't know whether it will or can do that by this afternoon. The resistance near today's high is thickening on the 10-minute Keltner channel, now at 615.89-616.56. On the 15-minute chart, it's a bit higher but is still drifting lower with price action. So, there's really not a conclusion yet as to whether that support has held or whether the OEX might still need to drop a bit closer to 608-609.

As I said in my early post this morning, I didn't really have a scenario in mind for what might happen. I think we're getting closer to a time when the OEX might break some direction or other from this sideways/sideways-down chop since last Friday, but which direction and exactly when isn't clear.

Keene Little : 6/12/2008 2:28:28 PM

AAPL held its 50-dma on the first touch (no surprise there) but now BIDU has given up today's rally and has dropped into negative territory and is currently making new daily lows. GOOG is in the middle of its pattern but looking weak. RIMM is back in negative territory. NDX can't afford much lower and should bounce back up here if there's to be at least another leg up to match this morning's spike up. But some of the bigger tech stocks aren't looking so good.

Linda Piazza : 6/12/2008 2:21:21 PM

Interesting comments, Jeff, in your 1:59:38 post, in regard to the previous discussions about Buffett's successor.

Jeff Bailey : 6/12/2008 2:20:40 PM

FXE $154.43 -0.85% ...

Linda Piazza : 6/12/2008 2:19:52 PM

I've switched to the OEX's 10-minute Keltner chart because the OEX is descending beneath that 10-minute 9-ema, rising up to test it more frequently than the 15-minute version but finding resistance at it on 10-minute closes since the 12:10 candle. There's a potential downside target of 609.26, already closely approached, but to erase the lower target, bulls need to see consistent 10-minute closes above that 9-ema, now at 612.25, and then a gain strong enough to turn that 9-ema higher. As the chart is set up now, it looks as if the 613.30-613.80 zone may provide resistance, too.

Jeff Bailey : 6/12/2008 2:15:40 PM

USO $110.75 -0.21% ...

Jeff Bailey : 6/12/2008 2:15:22 PM

Swing trade call alert! ... for one (1) of the Continental Airlines CAL July $12.50 Calls (CAL-GV) at the offer of $1.70.

CAL $12.19 +0.74% ...

Jeff Bailey : 6/12/2008 2:10:39 PM

QQQQ $47.46 +0.16% ... undercuts WKLY S2 ... again.

Jeff Bailey : 6/12/2008 2:09:00 PM

DIA $121.59 +0.44% ... probes DAILY Pivot.

Jeff Bailey : 6/12/2008 2:08:17 PM

What about CAL $12.19 +0.74% ...

Jeff Bailey : 6/12/2008 2:07:55 PM

FXE $154.48 -0.82% ...

Jeff Bailey : 6/12/2008 2:07:36 PM

USO $111.20 +0.18% ... comes to MONTHLY R1 ... again.

Jeff Bailey : 6/12/2008 1:59:38 PM

Linda ... here's some comments regarding KeyCorp Management ... Like many banks, KeyCorp strayed from its local roots into fast-growing regions as the nationwide real estate bubble expanded. Now, though, residential and commercial real estate loans in foreclosure-racked states such as California and Florida are a big part of KeyCorp's troubles.

Keene Little : 6/12/2008 1:58:28 PM

If today is to be a head-fake day (prior to opex week), this steep pullback could be it. It might lead to a strong reversal after setting a bear trap. That's pure speculation but I don't trust this day. As long as NDX holds above yesterday's low (since it's the most bearish today), the bulls haven't lost anything yet.

Keene Little : 6/12/2008 1:53:29 PM

Dropping to new lows for today's pullback makes for a cleaner wave pattern. The 2nd leg down today is now a 5-wave move, as it should be, and could therefore be completing the pullback here. At a minimum we should get another bounce to correct the leg down from the high near 11:20 AM.

Jeff Bailey : 6/12/2008 1:52:56 PM

BB&T (BBT) $27.389 +3.98% ... was another bank that had to take a Q1 charge on leveraged lease strategy.

Linda Piazza : 6/12/2008 1:52:19 PM

I should have mentioned one other potential support zone for the OEX, above the 608-609.50 one. It's just above that, at about 610-610.20, where the top trendline of yesterday's descending channel now crosses. It's possible that could hold as support now.

Keene Little : 6/12/2008 1:51:13 PM

Since breaking above its 50-dma in March AAPL hasn't even come close to it. Today it is now tagging it at 174.17. Should be good for a bounce at least.

Jeff Bailey : 6/12/2008 1:49:24 PM

KeyCorp (KEY) $12.75 -18.84% ... stock plunges as bank cuts dividend in half. US Court of Appeals threw out an arcane "leveraged lease" tax strategy the bank had been using.

Jeff Bailey : 6/12/2008 1:47:37 PM

Oh my ...

Jeff Bailey : 6/12/2008 1:47:22 PM

10-year Auction (results) ... 4.225%; 3.21% at the high. Bid-to-cover was 2.33. Coupon was 3.88%.

Linda Piazza : 6/12/2008 1:42:34 PM

USDJPY 107.91.

Linda Piazza : 6/12/2008 1:41:08 PM

If the OEX drops much below 612 and doesn't quickly pop back up again, it's in danger of dropping all the way to 608.23-609.50.

Traders should be warned, however, that we're entering a typical stop-running time of day right now, so be wary of any move over the next 20 minutes or so, and watch to see the result of that move. If there's a dip, watch to see if it's bought, because what we'll be watching is a test. Same thing with any punch higher, particularly past about 614.35. Watch to see if such a punch is sold off hard.

Jeff Bailey : 6/12/2008 1:40:15 PM

USO $109.96 -0.92% ... something's "gott'a give"

Jeff Bailey : 6/12/2008 1:39:42 PM

FXE $154.40 -0.87% ... the "Trichet" lows.

Jeff Bailey : 6/12/2008 1:33:11 PM

Anyone see where RIO traded in last night's extended?

Jeff Bailey : 6/12/2008 1:32:25 PM

VXO.X 24.35 -4.13% ...

Jeff Bailey : 6/12/2008 1:32:08 PM

"Bad tick" on the VXO.X to 14.86.

market it anyway.

Jeff Bailey : 6/12/2008 1:28:39 PM

I don't know about "informed opinion" on Mr. Buffet's succession. However, I've long-held the belief, based on observation, that when you've found a successful long-term enterprise, then succession should come from within.

Good book that touches on the topic is "From Good to Great"

HPQ went "outside" and paid the price with Ms. Fiorina. Nothing personal Ms. Fiorian, but growing telecom much different than growing computer company.

Linda Piazza : 6/12/2008 1:20:07 PM

Thanks, Jeff. I'm not particularly knowledgeable about these but know that there's been a lot of talk about succession. I thought you might have a more informed opinion than mine, so I appreciate it.

Linda Piazza : 6/12/2008 1:18:01 PM

The A/D line is only now testing its 15-minute 9-ema, now at about 880 with the A/D line at 898.

Keene Little : 6/12/2008 1:17:57 PM

NDX is now very close to its 1931.38 projection for two equal legs down from this morning's spike high. Any lower than that and I would start getting a lot more defensive again. We might see just a big sideways consolidation again but that would not be bullish. In the meantime, it's "close enough" to satisfy a corrective pullback and the start of another rally leg is what the bulls need.

Linda Piazza : 6/12/2008 1:16:54 PM

Potential support, if it can be called that, is now at 612.80 on 15-minute closes. The OEX is at 612.70 as I type. If you're bullish, you think the shape of the pullback looks like a bull flag. If you're bearish, you think the OEX is about to crater toward 608.50-609.50. I don't see the VIX or VXO giving us too many clues just yet, as neither is exactly breaking out to the upside.

Jeff Bailey : 6/12/2008 1:09:26 PM

As long as succession comes from within the organization Linda, I wouldn't be overly questionable.

That is ... somebody with the same driving principles as Mr. Buffett.

Jeff Bailey : 6/12/2008 1:06:23 PM

USO backfilled yesterday's gap. Threatens to backfill today's.

Jeff Bailey : 6/12/2008 1:04:07 PM

Lieberman Seeks Limits to Reduce Speculation ... NYTimes.com Story Link

Linda Piazza : 6/12/2008 1:04:02 PM

The OEX ended that 15-minute period at 613.43, a little below the Keltner support, but it had also pushed that Keltner support down to about 613.45, so it wasn't much of a violation. Yesterday's last OEX afternoon swing high on the 15-minute chart took it to 613.49, so bulls would like to see support near here hold and send the OEX higher again.

Jeff Bailey : 6/12/2008 1:02:41 PM

Tell you what ... USO $109.56 -1.28% ... sure seems to bid every time anybody mentions something about regulating this commodity's market. As if to say ... "if you regulate, you will pay!"

Linda Piazza : 6/12/2008 1:00:35 PM

Jeff, how do you feel about the whole succession issue with the Berks, baby or not?

Jeff Bailey : 6/12/2008 12:59:14 PM

"Baby Berks" (BRK.B) $4,234 +0.33% ...

Linda Piazza : 6/12/2008 12:59:49 PM

The USDJPY is 107.99, not retreating much from its test of its 200-ema and 200-sma's. The higher of the two, the 200-sma, is now 108.27. This is nosebleed territory here, so bulls want any pullback, if one occurs, to actually be a sideways movement. Japan should announce its rate decision tonight. That's supposed to result in another pause, but who knows what might be said with inflation rising so sharply earlier in the week.

Jeff Bailey : 6/12/2008 12:54:27 PM

TNX.X up 13 bp at 4.203% ...

Jeff Bailey : 6/12/2008 12:53:52 PM

10-year auction completed

Linda Piazza : 6/12/2008 12:53:04 PM

Next support for the OEX beyond that at about 614.56 is 613.54. The OEX has been zigzagging in a tight pattern either side of the 15-minute 45-ema, which is the support line now at 614.56. A push up toward 618.61-619 looks possible, but isn't yet a given. A decline toward 608.83 remains a possibility although it doesn't currently look the most likely of the outcomes. Sustained 15-minute closes beneath about 613.54 might change that outlook.

Linda Piazza : 6/12/2008 12:49:44 PM

On the Keltner chart, the possibility of an SPX rise toward resistance on 15-minute closes now at 1357.81-1359.70 exists but isn't yet a given. However, equity bulls need to know what they'll do to protect profits if that zone is approached since it could be strong resistance. As the chart is set up now, it would require either a strong push through that or else some time spent battering at it to break through. Since that push higher isn't a given, we should look at support, too. Beyond the 1349-ish support being tested, that's at 1346.93 on 15-minute closes and then at 1336.48.

Jeff Bailey : 6/12/2008 12:49:38 PM

Berkshire Hathaway (BRK.A) $126,975 +0.53% Link ... could be key stock at the big board.

Keene Little : 6/12/2008 12:38:37 PM

Following the sharp move lower this morning AAPL has been consolidating sideways near the low (bearish). BIDU had a great start to the day but is close to closing this morning's gap up, especially since it appears to be consolidating before dropping lower again (bearish). RIMM gapped up, dropped sharply into negative territory and has since bounced back up just into the green (neutral). GOOG gapped up and climbed sharply and has been consolidating near the high since 9:45 AM but could be in a pattern that's ready to drop back down (neutral). NDX looks like GOOG.

So we've got a mixed bag this morning and I could argue either way. That's not very helpful for a trade setup and that's instructive enough--don't press a trade here but instead wait for a better setup.

Linda Piazza : 6/12/2008 12:33:23 PM

An OEX push up to the next resistance level on the 15-minute chart, now lowered to 618.72-619, remains possible. So does a decline.

Jane Fox : 6/12/2008 12:31:49 PM

This is the first time for almost a year you are seeing this kind of price pattern, a pattern that denotes indecision. Crude buyers are saying I want to take this higher but the sellers are saying enough is enough and we need to take this down for a while. Thus you have this battle.

I would not be long or short here for there is nothing in the charts that tell me which way it will go. I do have a little bias to the downside because of the MACD but this market has been so strong of late that I can discount that easily. Link

Jeff Bailey : 6/12/2008 12:27:47 PM

Most Actives ... QQQQ $47.84 +0.97%, LEH $23.75 (unch), SPY $135.29 +1.00%, AAPL $176.37 -2.45%, INTC $22.47 +3.02%, MSFT $27.40 +1.03%, QCOM $49.20 +6.24% (pressing 52-weeker), CSCO $26.15 +1.94%, XLF $23.08 +2.98%, GE $29.87 +0.13%

Jeff Bailey : 6/12/2008 12:23:40 PM

12:00 Internals found at this Link

Keene Little : 6/12/2008 12:09:49 PM

After spiking up this morning, NDX could see another drop back down to complete a 3-wave pullback from this morning's high. Two equal legs down would be at 1931.38 which would also be close to a 78.6% retracement of this morning's quick rally. Any lower than that and I'd become more bearish. For now the short term pattern remains bullish but be aware we could see another pullback before the rally resumes.

Linda Piazza : 6/12/2008 12:02:34 PM

The TRIN is 0.73 with potential resistance on 15-minute closes at 0.77. It's got presumed support at 0.58 which we would know from historical norms, too. Basically, at this point, bulls would prefer that the TRIN not maintain levels above 0.77.

Linda Piazza : 6/12/2008 11:57:26 AM

The A/D line is dipping closer to the rising 15-minute 9-ema now, with that moving average at about 750 and the A/D line now at 948. Bulls want that support to hold on 15-minute closes.

Jeff Bailey : 6/12/2008 11:53:30 AM

Seeing some technical "similarities" between USO last few days and AAPL back in late December. (wink)

Keene Little : 6/12/2008 11:46:08 AM

Yesterday USO gapped up and nearly tagged the June 6th high, USO gapped down this morning and in the process left a glaring negative divergence against that high and has it looking like a double top. The problem is that the decline from June 6th now looks like a correction and the leg down today, which should go a little lower, would complete a larger 3-wave pullback from the June high. I'm on the sidelines with this one until the pattern clears up a bit more. If you're still short USO I'd stay there for now and use yesterday's high as your stop.

Linda Piazza : 6/12/2008 11:40:54 AM

OEX bulls want continued 15-minute closes above 614.59 and a breakout to a new high. Potentially significant resistance on 15-minute closes has now lowered to 619.40-619.44, and that's still descending. Bulls are going to need a lot of force or a lot of time consolidating to shove through that, so bulls should know how they're going to treat a test of that zone.

Jeff Bailey : 6/12/2008 11:39:39 AM

Nikkei-225 ($NIKK) finished 13,889 -2.08% ...

Jeff Bailey : 6/12/2008 11:38:39 AM

Hang Seng ($HSI) finished 23,024 -1.30% ... still struggles with reforms.

Jeff Bailey : 6/12/2008 11:38:54 AM

Shangia Comp. ($SSEC) .. finished 2,958 -2.21% ... still struggles with reforms.

Jeff Bailey : 6/12/2008 11:35:35 AM

DIA is $122.67 +1.33% ...

Jeff Bailey : 6/12/2008 11:35:01 AM

I've got the FTSE-100 at 5,787 +1.21% ...

Jeff Bailey : 6/12/2008 11:34:36 AM

I've got the DAX at 6,721.65 +1.07% ...

Jeff Bailey : 6/12/2008 11:33:56 AM

I've got the CAC-40 at 4,675.72 +0.32% ...

Jeff Bailey : 6/12/2008 11:33:30 AM

Good question!

Jeff Bailey : 6/12/2008 11:29:49 AM

DIA's low yesterday found buyers at that 01/18/08 LB trade of $121. Bulls will leverage.

See 01/21/2008 at 10:47:33 PM Link

Keene Little : 6/12/2008 11:19:39 AM

There hasn't been much of a pullback and the DOW is pressing to new highs. It could be part of a larger pullback correction (in which case we'll get a sharp pullback next) otherwise it will obviously be bullish if the market simply charges higher from here.

Linda Piazza : 6/12/2008 11:19:39 AM

So far, the A/D line has mostly chopped sideways-down from its high of the day. It's been doing so slowly enough that the 15-minute 9-ema has now risen to converge with the breakout benchmark. That's a good thing as it strengthens the support, but both, now at 582 and 630, are still far below the A/D line's current 1126 level, so bulls would like to see a new high or that sideways/sideways down pattern continued. There's also light support now at about 1045.

Linda Piazza : 6/12/2008 11:17:13 AM

The VIX has mostly been chopping around above the support I mentioned earlier today. It's pierced it but not closed any 15-minute periods below it. Equity bulls would now like to see the VIX drop below 22.19 or at least 22.66 and maintain 15-minute closes beneath that. The VIX is currently 22.86.

Jeff Bailey : 6/12/2008 11:14:37 AM

USO $107.48 -3.16% ...

Jeff Bailey : 6/12/2008 11:14:22 AM

On a broader scale ... GSG $71.12 -1.63% ...

Jeff Bailey : 6/12/2008 11:13:16 AM

DXY 73.87 +0.90% (30-minute delayed) ...

Jeff Bailey : 6/12/2008 11:11:50 AM

IEI $105.26 -0.59% ...

GLD $84.95 -2.37% ... ~$849.50 spot

Linda Piazza : 6/12/2008 11:12:13 AM

The OEX still has to get through that 616-617 level, but again, the chart shows the possibility if not quite the probability due to the earlier dip that the OEX might be able to make it up to test 619.37-619.89 resistance on 15-minute closes. I would have profit-protecting plans in place if it did reach that level, though. Right now, bulls just want support near 613.78-614.47 to be maintained on 15-mintue closes.

Jeff Bailey : 6/12/2008 11:10:48 AM

The "stagflation" scenario looks to be unraveling as I type.

Jeff Bailey : 6/12/2008 11:00:03 AM

Swing trade COVERED PUT alert! ... Let's sell one (1) of the Panera Bread PNRA July $40 Puts (UPA-SH) at the bid of $0.65. COVERED against the UPA-TI.

PNRA $47.15 +0.89% ...

VIX.X 23.04 -4.47%

VXN.X 26.52 -2.92% ...

Linda Piazza : 6/12/2008 10:51:40 AM

So far, the OEX is maintaining support on 15-minute closes at or above its 15-minute 9-ema, with that now at 613.37. It's natural to need to regroup when next resistance has been hit after such a strong decline since last Thursday's close, but bulls need to push the OEX back over 614.42 again on 15-minute closes and maintain it there to prompt shorts to start covering and help them fuel further rises.

Keene Little : 6/12/2008 10:50:18 AM

GOOG continues to baffle me as to where it's headed next. Price action since the May 2nd high looks like it's consolidating for another push higher. A rally above the May 30th high near 590 would be confirmation that GOOG will likely push up to at least the 600-620 area. A drop below 524, the top of its gap from April 18th, would trigger a sell signal. Until then it's just chopping up and down and not showing much strength. Daily chart: Link

Jeff Bailey : 6/12/2008 10:46:06 AM

Seeing article from DowJones that BMW's MINI USA has received more than 920,000 visits to its website in May, a record 88.9% increase from May'07. According to MINI, it has begun to see a increased sales +36% vs. year-ago.

The MINI gets approx. 37 mgp

Linda Piazza : 6/12/2008 10:42:38 AM

I wanted to remind subscribers that Federal Reserve Chairman Bernanke speaks in Kansas City at 11:30 today. He's speaking at a dedication of a new Federal Reserve Bank there, giving introductory remarks, so I don't know that there will be any Q&A session and kind of doubt it, so I don't know that we'll have any bullet points taking aim at our markets. Still, I thought subscribers should be aware that was coming up.

Jeff Bailey : 6/12/2008 10:41:43 AM

Uganda's Finance Minister withdraws tax breaks for oil exploration.

Keene Little : 6/12/2008 10:39:52 AM

CME has been in a corrective bounce since its June 4th low and should be able to bounce a little higher (411-414) before heading lower again. The downside Fib projection at 338 continues to look like a good target. Daily chart: Link

Linda Piazza : 6/12/2008 10:39:50 AM

The TRIN is currently 0.77.

Jeff Bailey : 6/12/2008 10:39:27 AM

UNG $60.67 +0.96% ...

Jeff Bailey : 6/12/2008 10:38:54 AM

EIA Weekly Nat. Gas Storage Link ... Build of 80 Bcf to 1,886

Keene Little : 6/12/2008 10:29:59 AM

AAPL and RIMM have not been participating in this morning's rally and now NDX is pulling back more sharply than the others. This could be a drag on the broader market if the techs don't join in today's rally.

Jeff Bailey : 6/12/2008 10:28:52 AM

Per today's internals: It would take a closing session measure of <32.00% for the NASDAQ 10-day NH/NL ratio to see a 3-box reversal back lower.

Linda Piazza : 6/12/2008 10:28:19 AM

The OEX's 15-minute 9-ema is now 612.68. Bulls would like to see that hold on 15-minute closes, and then, if that holds, we start again, seeing if the OEX can break through resistance now up to 614.81 on 15-minute closes.

Linda Piazza : 6/12/2008 10:26:00 AM

Through everything happening over the last few days, I hadn't seen anything happening on the TED spread to indicate that there was newly heightened concern about defaults. Of course, the TED spread is well above historical norms of 0.10-0.50 and has stayed well above those norms since last August, but I worried that the TED spread had approached support from a channel it had been in since then and might curve up and move through 1.00 again. Although that remains a possibility, the TED spread has just chopped around in a narrow range this week. It's currently 0.83, down 0.022 or 2.582% from yesterday's close. I'm still watching. I'm inexperienced watching this and my evidence about where support might lie and my worries about an upturn through 1.00 again are anecdotal observations made during a time when the TED spread was already behaving in an abnormal manner. They might not have much validity, but everyone does agree that a rising TED spread is not good. So, when it wasn't rising much, I didn't see it confirming that part of our worries about the economic problems, at least.

Jeff Bailey : 6/12/2008 10:24:40 AM

FXE $154.58 -0.75% ...

Jeff Bailey : 6/12/2008 10:24:16 AM

US Oil Fund (USO) $109.01 -1.75% ... back to specified stop.

Jeff Bailey : 6/12/2008 10:23:45 AM

10:00 Internals found at this Link

Linda Piazza : 6/12/2008 10:20:58 AM

The A/D line has moved up into potential light historical resistance in the 1250-1280 level. It's currently 1184 as it pulls back. There's not much nearby Keltner support beneath the A/D line and it would be a steep pullback even to test the breakout benchmark that's now way down at 592, so here's what equity bulls want to see: they want to see the A/D line chop around in a narrow range while some of that support catches up with the A/D line.

Keene Little : 6/12/2008 10:15:43 AM

I was talking yesterday about a 5-wave move down from Tuesday's high and therefore expected at least a correction to that decline. This morning's bounce has already corrected 62% so far for the DOW 12258. A steep pullback and then another leg up that fails short of Tuesday's 12368 high would be a setup for a short play. This is assuming today's bounce will only correct the decline from Tuesday. But a rally back above Tuesday's highs would suggest we've got something more bullish in progress. We'll take it one leg at a time and try to put the pieces of the puzzle together. Link

Linda Piazza : 6/12/2008 10:13:48 AM

OEX bulls, the 15-minute 9-ema has now risen to 612.65. You'd prefer for 15-minute closes to be above 614.59, but if not, above that 9-ema. You'd like to see renewed gains soon to keep that 9-ema turning higher as it's doing now. There's potentially strong resistance in the 619.71-620.45 region, too, so I'd suggest knowing in advance how you'll treat a test of that region, if it should occur. We of course also saw some 616-617 S/R over the last few days, but Keltner charts are telling me that if the OEX can stabilize above that 614.59 level, then it's likely to push through 616-617 and test that higher level. Keep some skepticism about targets, but know that there's currently vulnerability up to the 619.71-620.50-ish zone.

Linda Piazza : 6/12/2008 10:09:54 AM

The VIX has pulled back, of course. It has potential historical, trendline and short-term Keltner support now from 22-22.64, so there's a possibility that its retreat could still soon. Equity bulls would prefer that it just keel over and stay keeled over. As I typed, it just punched lower but punched right back up. Be watchful for some volatility in this volatility measure as that support is tested. Here's the daily Keltner chart I've been posting lately, though, showing the strong resistance the VIX was facing, and now showing the potential support: Link

Linda Piazza : 6/12/2008 10:05:14 AM

USDJPY now 108.02, above the daily 200-ema but still below the 200-sma.

Linda Piazza : 6/12/2008 10:03:39 AM

The OEX has moved up to challenge first resistance on 15-minute closes. The last candle actually closed a little above that resistance, now up to 614.61 on 15-minute closes, but it wasn't a particularly great-looking candle as candles go, and so it's possible that some sideways/sideways-up consolidation will now be needed before the OEX can push up, if it does.

Keene Little : 6/12/2008 9:59:49 AM

The spike back up in the futures at the cash open, after pulling back from the 8:30 AM high, was an extra measure of assurance that the market would not pull back right away in an attempt to close this morning's gap up. So far it looks like the typical way this market starts a rally leg. The April 16th gap up, which SPX barely missed closing yesterday, started exactly like this. And it led to a nearly 900-point rally in the DOW to the May 2nd high. Will it happen again? Only time will tell but obviously that's what the bulls are hoping for.

Jeff Bailey : 6/12/2008 9:56:37 AM

Swing trade long exit alert! ... the 1/4 position in the US Oil Fund (USO) $108.62 -2.12%

Linda Piazza : 6/12/2008 9:57:48 AM

The annotations may be a little difficult to read, but here's a daily OEX Keltner chart: Link I don't have a scenario for today other than that this pattern isn't diverging too much from that seen after the 2/05 candle, a candle that Friday's nearly copied exactly. That means that we could still get the same outcome: a climb that resulted in choppy price action for another few weeks although the ultimate outcome wasn't good. So, my only scenario is that we could see this choppy move lower into the 608-610 support zone resolved today or tomorrow or maybe not until Monday, and that a resolution that involved some kind of climb isn't precluded.

Linda Piazza : 6/12/2008 9:45:24 AM

At 107.87 as I type, the A/D line is at its daily 200-ema. Those hoping for continued equity gains don't want to see it pull back too far from this test. Be aware, as I warned yesterday, that the Bank of Japan last night began a two-day policy meeting. Earlier in the week, Japan got numbers that showed inflation rising--not a big surprise--so most think that the BoJ's hands will be stayed this time, but what if they make noises about raising rates soon? I don't know what they'll say and what will happen as a result, but just be aware of the potential for either a breakout or a sharp downturn.

Linda Piazza : 6/12/2008 9:38:27 AM

A/D line currently 1034.

Linda Piazza : 6/12/2008 9:37:55 AM

Keltner outlook on the A/D line: As could be anticipated, the A/D line jumped up into the upper or bullish half of the Keltner channels on the 15-minute chart. In fact, it pushed past upper-boundary resistance, which is currently 588 on 15-minute closes. Those who are worried about a pop-and-drop day do not want the A/D line to pull back sharply and close this 15-minute period below that line or to do it within the first 30 minutes of trading, either. They want the A/D line to maintain breakout status.

Linda Piazza : 6/12/2008 9:33:49 AM

Late yesterday, Keene was mentioning that the put/call ratio had moved into regions that sometimes--not always--signaled that bearishness had grown too extreme. Late yesterday, I kept noticing that throughout much of the day, the VIX was trending down as equities did, too, with both creating a trending-lower tight channel on intraday charts. Of course, while equities were bouncing up within their tight channels, the volatility indices were turning down within theirs, but each had their descending channels, which isn't the usual way it works. Of course, the VIX broke up through that channel as equities broke down in the last few minutes of trading, but still there had been that divergence from the typical action. I wasn't sure what it meant. In addition, the USDJPY wasn't really pulling back much from its approach to its 200-ema.

We had some warning signs without any of them being good market timing tools. Now what? If the OEX were to move up to match what we saw with SPX futures' levels above their fair value, then we might expect something in the 612-613 region. In fact, the OEX is zooming up toward it as I type. First potential resistance on a Keltner basis on 15-minute closes is now 613.55-614.15.

Keene Little : 6/12/2008 9:18:29 AM

With equity futures up strong this morning it looks like the bulls may get the save they needed. The only question now is whether we'll get a pullback after the open to close this morning's gap up. I would have actually preferred to see the market start down and then do a quick reversal, especially since SPX missed closing its April gap by only a point. When a reversal starts with a gap it makes it a real challenge since we don't know if it will just continue or instead close the gap first.

But we've seen this many times before where a morning gap starts a big move where traders are forced to chase it. In this case shorts will be covering and bull-wannabees will be piling in, fearful of missing the start of a rally. This can easily propel the DOW several hundred points. The setup was there at the end of the day for a reversal and now we'll see if the bulls can capitalize on it.

Jane Fox : 6/12/2008 8:55:19 AM

Economic data out at 8:30 lifted the markets but the rally was short lived. Link

Jane Fox : 6/12/2008 8:50:54 AM

WASHINGTON (MarketWatch) - Jump-started by an infusion of nearly $50 billion in stimulus checks from Uncle Sam, retail sales rose a surprising 1% in May, the fastest increase in six months, the Commerce Department reported Thursday.

Sales were boosted by higher gasoline and food prices and by eye-catching gains at building materials stores and furniture stores.

Motor vehicle sales rose 0.3% in dollar terms, despite a decline in unit sales reported by the automakers. Excluding autos, sales rose 1.2%, also the biggest gain in six months.

Excluding the 2.6% rise in gas station sales, sales increased 0.8%, the biggest gain in a year.

Sales are up 2.5% in the past year, while sales excluding autos are up 4.9%. The figures are not adjusted for price changes.

The report was much better than expected, including hefty upward revisions to sales figures for March and April. Economists surveyed by MarketWatch were expecting total sales to rise 0.6% in May and for sales excluding autos to rise 0.8%.

Jane Fox : 6/12/2008 8:49:41 AM

WASHINGTON (MarketWatch) -- Prices of goods imported into the U.S. rose 2.3% in May, the Labor Department reported Thursday, with elevated prices for petroleum and natural gas mostly behind the gain.

Excluding all fuels, import prices rose only 0.5% in May.

The overall rise was a bit lower than economists surveyed by MarketWatch expected. They were looking for import prices to rise by 2.7% in May.

Import prices for April were revised upward, to 2.4%.

Prices for imported petroleum rose by 7.8% in May, the data show. Those prices are up nearly 70% for the year ended in May.

Prices for imported natural gas made their eighth consecutive increase, rising by 5.4% in May.

U.S. export prices, meanwhile, rose by 0.3%, the smallest monthly gain since September 2007.

Jane Fox : 6/12/2008 8:48:41 AM

WASHINGTON (MarketWatch) -- First-time filings for state unemployment benefits spiked upwards in the latest week, hitting their highest level since late March, as the number of continuing jobless claims marked their highest level since early 2004, the Labor Department reported Thursday.

In a sign of labor market weakness, initial jobless claims jumped by 25,000 in the week ending June 7, to 384,000. It's the highest since March 29.

The four-week average of initial claims, however, was slightly lower, at 371,500. It was a rise of 2,500 from the prior week and the highest since May 17. The four-week average is a measure of the underlying employment trends.

Continuing unemployment claims reversed course from a week earlier and posted a gain of 58,000, pushing the number up to 3.14 million for the week ending May 31. That was the highest since early February 2004.

Continuing claims have been above three million for almost two months, a sign that workers are having difficulty finding new jobs.

Jeff Bailey : 6/12/2008 3:06:42 AM

Companhia Vale do Rio Doce (RIO) $34.44 -2.29% ... 2 chart montage at this Link

Conventional retracement (left) and Pivot (right)

Last tick extended was $33.94.

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