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Jeff Bailey : 7/23/2008 12:28:54 AM

Regional Bank HOLDRs (RKH) ... 5-minute interval chart Link

Exchange data feed outages yesterday indexes, and QCharts server outages this morning.

Missing data for Pivot analysis traders.

RKH session low today, may end up being WKLY low.

BIX.X low/high today 161.53-191.29, but need RKH observation to "fill in the blank" for BIX.X low (Also just above its WKLY Pivot).

Jeff Bailey : 7/23/2008 12:28:43 AM

Yep ... See Tuesday's MM @ 02:36:34 to 02:46:58 PM.

Jeff Bailey : 7/23/2008 12:28:35 AM

Regional Bank HOLDRs (RKH) $105.05 +10.02% ... session low/high was $91.73-$105.05.

So, today's low under Monday's.

What a move this morning, then another wave at 02:40-02:45. About the time of this afternoon's buy program premium.

Jeff Bailey : 7/23/2008 12:28:28 AM

Closing Internals at this Link

Biiig volume at big board today. Heavy at NASDAQ.

RUT.X NH/NL finishes 36:22. Daily ratio 62.1%, 5-day 46.6% and 10-day 26.4%.

Jeff Bailey : 7/22/2008 11:20:03 PM

S&P 500 Heavyweights at this Link

5-dayNet% would be from 07/17/08 close. 20-dayNet% would be from 07/02/08 close.

Keene Little : 7/22/2008 11:04:05 PM

Wednesday's pivot table: Link

With the banks (BIX) up near potential resistance after a huge short-covering spike up ( Link ), we could see a sudden halt to the buying. At least that's the potential. The rally in the broader market from last Tuesday could also be finishing its 5th wave (small pullback and minor new high on Wednesday would be an ideal finish). That should set up a pullback that could retrace as much as 50%-62% of the leg up (back down to DOW 11200/SPX 1240).

The short-term bullish setup is for a pullback into a low by next Monday and then another rally leg into early August to finish an a-b-c bounce off the July 15th low (target DOW 12000/SPX 1320), shown in pink on the DOW 120-min chart: Link . Those upside projections are close to a 50% retracement of the May-July decline. If the DOW were to drop much below 12K into next week it would suggest at least a retest of the July 15th low.

But assuming the pink wave count plays out, the current bounce that corrects the decline from May could be a 2nd wave correction (or something similar) and these tend to get traders feeling bullish so be careful--trade the bounce but don't plan on any longer-term trades to the upside. Just like the larger correction that ran from March to May (which had most everyone believing we had seen the lows for the year), this one will also fail and the next decline will make the May-July look like a minor drop.

Depending on whether we see the bounce up to near DOW 12K within the next 2 weeks, or if it instead happens a little later after a retest of the July 15th low, the leg down following the bounce will be a very strong and sharp selloff, perhaps taking us to a tradable low in October. The daily chart shows the two possible scenarios for the bounces before heading lower again: Link

OI Technical Staff : 7/22/2008 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 : 7/22/2008 7:00:50 PM

Valero Energy (VLO) $35.26 -1.28% ...

Jeff Bailey : 7/22/2008 7:00:24 PM

Tesoro (TSO) $17.75 +0.50% ...

Jeff Bailey : 7/22/2008 6:59:35 PM

September unleaded/crude oil "crack spread" tabulation at Tuesday's close was 24.672.

Jeff Bailey : 7/22/2008 6:54:49 PM

Closing U.S. Market Watch found at this Link

Low and Highs do look to be accurate for most. I've tried to check against other data sources I deem reliable.

Jeff Bailey : 7/22/2008 6:49:13 PM

Nymex August Crude Oil (cl08q) official and final settlement was $127.95. Down $3.09, or -2.36%.

Nymex September Crude Oil (cl08u) settled down $3.40, or -2.57% at $128.42.

Jeff Bailey : 7/22/2008 6:24:56 PM

QQQQ $44.78 (unch) ... day's range 43.86-44.81

Jeff Bailey : 7/22/2008 6:20:51 PM

RUT.X 716.82 +2.75% ... day's range 691.66-716.82

Jeff Bailey : 7/22/2008 6:19:31 PM

OEX.X 588.69 +1.62% ... day's range 574.18-589.02

Tab Gilles : 7/22/2008 6:01:50 PM

United States Oil (USO) $103.32 -$3.35 (3.14%)

The decline in oil was a huge contributor to todays closing rally. I'd mentioned last Friday that the trend in the USO had broken and that it would likely test the $98 38.2% retracement level/ 100ma.

Tab Gilles : 7/18/2008 10:53:15 AM

United States Oil (USO) $105.80; which seeks to imitate the price of West Texas Intermediate (WTI) light sweet crude oil had been in an uptrend channel since the early part of the year. It is currently testing its 50-ma and broken below the channel, next test $98. Note, that the 61.8% retracement coincides with it's 200-ma. Link

Daily chart: Link

Tab Gilles : 7/22/2008 5:21:51 PM

Apple (AAPL) $162.02 -$4.27 -2.57%

Very impressive rebound from its intraday lows today, $146.53 coming very close the the March/May 61.8% retracement.

As usual the stock sells off on earnings report and Apple's sandbagging conservative guidance. In last night 5:56pm post I stated:

Management in their conference call said that margins for this fiscal year of 34% would be lower in the next fiscal year...somewhere around 30%. Mostly due to lower iPhone prices as the company moves more into phones than their traditional PC sales.

At first it spooked traders/investors, but a closer look indicates that Apple which has maintained a higher price halo on the Mac pc's is now making a move to go after market share lowering its product price points. The Mac growth is 3xs the average pc growth, you gotta look at the large pricture. For the next two quarters you're going to have the 3G revenue, back-to-school pc sales and end of year holiday sales!!!

10 day 15 minute chart: Link

Jeff Bailey : 7/22/2008 5:10:16 PM

SPX.X 1,277.00 +1.35% ... day's range 1,248.82-1,277.42

SPY $127.48 +1.13$ ... day's range 124.85-127.80

Jeff Bailey : 7/22/2008 5:07:18 PM

INDU 11,602.50 +1.18% ... day's range 11,387.39-11,616.66

DIA $115.70 +0.92% ... day's range 113.75-$116.08

Jeff Bailey : 7/22/2008 4:53:12 PM

DXY's 04:00 tick was 72.479

Jeff Bailey : 7/22/2008 4:47:22 PM

Dow Transports (TRAN) 5,152 +3.54% ... at the close, reclaim my "modest economic growth" trend.

Jeff Bailey : 7/22/2008 4:40:28 PM

Washington Mutual (WM) $5.82 +6.20% ... ticking $6.12 now.

Jeff Bailey : 7/22/2008 4:39:32 PM

WaMu's Earning's Press Release Link

Jeff Bailey : 7/22/2008 4:38:42 PM

Broadcom's Earnings Press Release Link

Jeff Bailey : 7/22/2008 4:37:32 PM

Broadcom (BRCM) $27.64 +0.73% ... gets a pop to $28.30 extended on headline numbers.

Tab Gilles : 7/22/2008 4:40:38 PM

Washington Mutual (WM) $6.32 +$.40 in after hours on reported $3.24 loss per share, estimates were for a $1.04.

Looking at other big banks: Link

I continue to favor JP Morgan (JPM) which I first ,mentioned over a week ago:

Tab Gilles : 7/14/2008 12:20:58 PM JP Morgan Chase (JPM) $32.11 -$1.06 (3.06%) Looking at a daily chart Link Weekly chart...hitting 3 year lows around $32

A few out of the money LEAP calls look interesting, January 2010 $35 WJPAG, $40 WJPAH & $45 WJPAI. Link

How are those call LEAPS doing thus far? JPM $40.86, WJP-AG $10.30, WJP-AH $7.65, WJP-AI $5.50.

Jeff Bailey : 7/22/2008 4:20:24 PM

FRE $9.70 +10.86% ... $10.00 extended.

Jeff Bailey : 7/22/2008 4:19:49 PM

BAC $32.35 +13.27% ... $32.28 extended.

Jeff Bailey : 7/22/2008 4:17:27 PM

WM's Q2 loan loss provision $5.9B

Jeff Bailey : 7/22/2008 4:16:00 PM

Washington Mutual (WM) $5.82 +6.20% ... darts lower to $5.43 extended on headline numbers.

Keene Little : 7/22/2008 4:12:14 PM

The most heavily shorted stocks have been some of the strongest stocks in the past week. Short covering, especially in the financials which have been designated a no-short zone, can be an amazingly strong move. The banking index (BIX) has now shot practically straight up towards the top of a parallel down-channel for price action since the February high. Link

The wave count calls the current bounce a 4th wave correction and you can see how it alternated in form from the 2nd wave correction in March-April, a common thing to see between 2nd and 4th wave corrections. Wave (ii) was flat and wave (iv) is a sharp rise. If the wave count is correct we could see the BIX top out at its 50-dma at 198.51 (closed today at 190.33) and then see the selling resume.

Jeff Bailey : 7/22/2008 4:11:39 PM

I've read enough, to know I've read too much.

Jeff Bailey : 7/22/2008 4:11:20 PM

Viagra effective for women taking antidepressants

Study published in the Journal of the American Medical Association finds that Pfizer's (PFE) erectile dysfuntion drug Viagra can reduce adverse secual effects in women caused by antidepressant use.

Linda Piazza : 7/22/2008 4:06:12 PM

Tomorrow's before-the-open reporting companies include NWA, R, UIS, BA, WHR and HSY. My source does not specific the reporting time for a number of companies, so there will probably be other important reports before the open, too.

Jeff Bailey : 7/22/2008 4:03:18 PM

FRE $10.10 extended.

Jeff Bailey : 7/22/2008 4:02:44 PM

Oh my ... FRE $9.67

Linda Piazza : 7/22/2008 4:02:14 PM

Earnings include BRCM, CHRW, ETFC, PNRA, STM, a number of financials, including some lesser known names as well as WM, of course, after the close. YHOO also reports after the close.

Jeff Bailey : 7/22/2008 3:59:48 PM

Dow Diamonds (DIA) alert! $115.89 +1.05% ... trades 01/22/08 relative low.

Linda Piazza : 7/22/2008 3:58:18 PM

Some overnight economic developments include the Bank of England's MPC meeting minutes at 4:30 am ET tomorrow morning, and Industrial Orders for the Eurozone at 5:00.

Keene Little : 7/22/2008 3:56:48 PM

Updating the SPX 30-min chart (which has some price gaps) it looks like the pink wave count wins with the move back above 1268 (the key upside level). As expected the sideways consolidation has in fact turned out to be bullish. Now if we get two equal legs up from last Tuesday's low we get an upside target near 1315 which we should see by Friday. It can always end earlier (lower Fib target near 1290 for example) but for planning purposes 1315 is a good target for now. Link

Jeff Bailey : 7/22/2008 3:56:56 PM

RUT.X 715.66 ... Only equity-based index in your Pivot Matrix to trade WKLY R1 so far.

Jeff Bailey : 7/22/2008 3:53:18 PM

Freddie (FRE) $9.22 ... tentative at DAILY Pivot.

Linda Piazza : 7/22/2008 3:51:55 PM

The RUT, of course, is well above its 30-sma, zooming today up toward and into the 714-720-ish potential historical resistance zone. RUT traders should perhaps note that it's closely approaching its weekly 200-sma, now at 715.88. I haven't found this weekly version particularly strong S/R for the RUT, as the RUT tends to sometimes spend some time trading on either side of it for a while once it's approached rather than necessarily finding support or resistance on it at weekly closes. It sometimes does, of course. Still, even if it's not always so predictive, some might be watching it along with the historical S/R zone being approached. Snug up your stops if in bullish trades, just in case.

Jeff Bailey : 7/22/2008 3:51:29 PM

IWM $71.17 +2.07% ... volume brisk at just over 99.5 million. Slightly above 50-day average daily volume.

Jeff Bailey : 7/22/2008 3:50:00 PM

Yesterday's RUT.X 5-day NH/NL ratio did generate a "buy signal" at 35.2%. Needed 32.0% on chart.

Jeff Bailey : 7/22/2008 3:48:06 PM

Rather "weak" with $PREM.X only falling to -1.73.

Jeff Bailey : 7/22/2008 3:47:05 PM

Sell program premium done ... as quick as it was generated.

Jeff Bailey : 7/22/2008 3:46:02 PM

VIX.X alert! 21.39 ... undercuts QRTRLY Pivot.

Jeff Bailey : 7/22/2008 3:45:27 PM

SPX 1,272.10

Jeff Bailey : 7/22/2008 3:45:17 PM

Sell program premium ...

Keene Little : 7/22/2008 3:44:43 PM

Checking the futures of the others I see the DOW not quite up to yesterday morning's high and of course NDX is way behind and pulling up the rear. But wow, who fed the RUT some Cheerios? That one is shooting higher like there's no tomorrow. Someone certainly believes the bottom is in.

Linda Piazza : 7/22/2008 3:39:03 PM

The OEX did not drop all the way down to its daily 10-sma to test it today, but the SPX very nearly did. Today qualifies as a 10-sma test day, then, but the OEX's outperformance on that measure means that it didn't quite get down to its 10-sma, now at 572.28. It did, however, test and even pierce the 9-ema that I prefer to watch. Barring a strong downdraft into the end of the day, the OEX will have found support on a daily close on that 9-ema as well as lower potential support now at 574.25.

In my previous days' posts and in the 9:29:58 one this morning, I noted the possibility that the OEX might be setting up a consolidation zone with daily closes at or above the 10-sma and daily closes at or below the still-descending 30-sma. A few more days of chop between those parameters remains a possibility. When the 30-sma was still in the 591-593 range, I noted that it might well have descended toward the 587-588 known resistance level before it could be tested, and it's now 588.67.

Today's performance was strong and encouraging to those who want to see a move higher than endures weeks rather than days, but remember that possibility of more range-bound trading, being sure to protect profits as the OEX edges toward that 30-sma, if it does, since it may mostly cap gains until the OEX gets through consolidating and decides on next near-term direction.

The possibility exists that the decision has been made and today's near-10-sma test and just-made new high are showing us the direction. However, maintain just the slightest skepticism and make sure you know how you'll treat that 30-sma test, whether it occurs this afternoon or tomorrow or some other day. Remember that the overall view is that this is a relief or bear-market rally, my view, too, and could give way at any time. I've long thought we were overdue for a sharp rally, so enjoy it while it lasts, but just don't back up the truck with long positions.

Keene Little : 7/22/2008 3:36:34 PM

Because of the price gaps in SPX yesterday and today I've lost the reliability of some of the technical indicators for the past two days. But using ES I see it's challenging yesterday morning's high. Bulls need to hold it so that it doesn't turn into a double top.

Jeff Bailey : 7/22/2008 3:34:41 PM

NASDAQ a/d 1,831:1,052

Jeff Bailey : 7/22/2008 3:34:26 PM

NYSE a/d 2,001:1,129

Jeff Bailey : 7/22/2008 3:33:22 PM

iShares iBoxx High Yield (HYG) $93.67 +0.18% ...

Jeff Bailey : 7/22/2008 3:31:37 PM

PHF $8.02 -0.24% ... easy, easy does it all you "junk bond" bulls from 07/16/08 @ 10:51:58 AM.

Jeff Bailey : 7/22/2008 3:28:26 PM

Russell 2000 (RUT.X) alert! 711.83 ... probes its 150-day SMA from underneath.

Jeff Bailey : 7/22/2008 3:25:54 PM

FRE-JB's $2.40 x $2.50

Jeff Bailey : 7/22/2008 3:25:18 PM

Freddie Mac (FRE) $9.06 ... WKLY Pivot looks to have held.

Jeff Bailey : 7/22/2008 3:24:34 PM

Bank of America (BAC) $30.91 ... "prarie dogs" Monday's high. QCharts' WKLY R1.

Linda Piazza : 7/22/2008 3:23:44 PM

The A/D line has potential resistance on 15-minute closes at about 1090. It's at 830 as I type.

Jeff Bailey : 7/22/2008 3:16:52 PM

BKX.X 65.40 ... "prarie dogs" Monday's high.

Linda Piazza : 7/22/2008 3:12:59 PM

It's a strange world when a daily range of more than 8.5 points seems like just another ho-hum day for the OEX. I can remember times when it might have taken a swing trade of a couple of days, not a day trade, to capture that many OEX points.

Jeff Bailey : 7/22/2008 3:12:50 PM

VIX.X 22.15

Jeff Bailey : 7/22/2008 3:12:33 PM

Swing trade long alert! ... for one (1) of the Freddie Mac FRE Oct $10 Calls (FRE-JB) at the offer of $2.15.

FRE $8.36

Linda Piazza : 7/22/2008 3:08:39 PM

Potential OEX resistance on 15-minute closes is now 584.17. The rising 9-ema's support might be found at 581.49 on 15-minute closes, with next support below that now near 579.65.

Jane Fox : 7/22/2008 2:54:40 PM

The VIX is supporting the new daily highs and is suggesting it may go higher. Link

Jeff Bailey : 7/22/2008 2:53:32 PM

Good gravy ... SOHU $76.73 too.

Jeff Bailey : 7/22/2008 2:53:28 PM

Certainly a benefactor of the buy program premium.

Jeff Bailey : 7/22/2008 2:51:40 PM

AAPL $158.37 ... coming back.

Jeff Bailey : 7/22/2008 2:49:57 PM

TRIN 1.06

Jeff Bailey : 7/22/2008 2:49:29 PM

$PREM.X rose to 2.67 ... "strongest" buy program premium since QCharts servers came up.

Jeff Bailey : 7/22/2008 2:48:23 PM

SPX 1,264.54

Linda Piazza : 7/22/2008 2:48:09 PM

The OEX did drop into the 579.20-579.90 zone mentioned in my 2:05:22 post, but it didn't stay there long and is not jumping up toward its previous 582.44 high of the day, which it could even test or top before I finish this post. Be aware of the potential resistance there and especially that on 15-minute closes that's now at 584.20.

Jeff Bailey : 7/22/2008 2:47:40 PM

Done ...

Jeff Bailey : 7/22/2008 2:47:32 PM

still underway ...

Jeff Bailey : 7/22/2008 2:47:12 PM

SPX 1,263.27

Jeff Bailey : 7/22/2008 2:46:58 PM

Buy program premium ...

Jeff Bailey : 7/22/2008 2:44:38 PM

Haven't seen any meaningful sell program premiums generated since QCharts' servers came up today. One buy program premium to 2.08 from 02:30-02:35 PM EDT.

Jeff Bailey : 7/22/2008 2:41:21 PM

Bank of America (BAC) $30.05 +5.22% ... has done battle with its WKLY R1 ($30.82) on Monday with session high of $30.89. WKLY Pivot $24.63.

Jeff Bailey : 7/22/2008 2:39:27 PM

Fannie Mae (FNM) $12.31 -12.85% ... QCharts' WKLY Pivot at $11.55.

Jeff Bailey : 7/22/2008 2:38:37 PM

Freddie Mac (FRE) $7.97 -8.91% ... sitting on QCharts WKLY Pivot here.

Keene Little : 7/22/2008 2:36:34 PM

The indices are just getting jerked up and down with buy and sell programs. The net result is sideways for the market and we just need to wait for the log jam to break.

Linda Piazza : 7/22/2008 2:27:04 PM

Earlier, the TRAN was zooming, but it ran into the Keltner resistance on the 15-minute and 30-minute charts, with the 30-minute version now at 5133.40 but then a little lower. Now, after pulling back, the TRAN is testing potential support on 30-minute closes that's now at 5075.40. OEX, Dow and SPX bulls would like to see the TRAN bounce from this potential support. If that support doesn't hold, they want further potential support now from 5030-5050 to hold up or the TRAN risks a fast trip back below 5000 again. The TRAN is currently at 5090.67.

Jeff Bailey : 7/22/2008 2:25:37 PM

USO's 05/20/08 June crude futures settlement benchmark right in here at $104.30.

Jeff Bailey : 7/22/2008 2:24:20 PM

US Oil Fund (USO) $104.14 ... attempt to reclaim upward trend from bar chart (02/08/08 relative low to 04/01/08 relative low).

Jeff Bailey : 7/22/2008 2:14:03 PM

02:00 Internals found at this Link

Linda Piazza : 7/22/2008 2:05:22 PM

The OEX may be holding onto the support of the 30-minute 9-ema on 30-minute closes but it isn't really bouncing from that moving average. That's flattening that moving average and the 15-minute version. It may be easier for the OEX to drop down toward 579.20-579.90 now than it was earlier. It needs to bounce soon from that moving average into a new high of the day or it risks dropping instead.

Jeff Bailey : 7/22/2008 1:55:40 PM

Mutual fund giant Fidelity Investments reporting a 2% increase in client assets, with average daily trades jumping 19% amid market volatility.

Adds $23.5 billion in net new client assets and more than 130K new accounts. Total accounts up 1% to 18.1 million.

Daily commissionable trades jumped 30%, but new client assets dropped 19% and total assets rose 1%. Institutional advisor side of brokerage saw new client assets increase 10%, with total assets up 22% and trading surge 41%.

Linda Piazza : 7/22/2008 1:52:10 PM

The TED spread is now 1.26, its low of the day.

Jeff Bailey : 7/22/2008 1:45:47 PM

20-year TIPS results ... U.S. Treasury awarded $6.00 billion in reopened 20-year Treasury inflation-protected securities at high rate of 2.219%.

Received bids totaling $9.46 billion and accepted $6.0 billion, including $32.90 million of noncompetitive tenders. Amount of noncomps was down from $88.01 million at previous July 10 auction.

Median rate of today's auction was 2.130%' that is, 50% of amount accepted competitive bids were tendered at or below that rate.

Dollar price was $95.749964 and coupon rate was set at 1.75%.

Tenders at the high yield were allotted 88.95%.

Bid-to-cover, an indication of demand, was just 1.58.

CUSIP number is 912810PV4.

Jeff Bailey : 7/22/2008 1:39:56 PM

20-year TIPS auction results released.

Jeff Bailey : 7/22/2008 1:37:33 PM

Chesapeake Energy (CHK) $51.43 -5.33%

Jeff Bailey : 7/22/2008 1:37:07 PM

UNG $46.99 -5.62% ... Dolly tracking away from Gulf platforms.

Linda Piazza : 7/22/2008 1:33:58 PM

I'm back and the OEX is still finding support on 15-minute closes on its 30-minute 9-ema, now at 580.44. That preserves the possibility that the OEX will reach up toward a next potential Keltner target, now from 584.40-585.70. So, we know what we've known. Potential resistance is in that 583-586 zone.

Jeff Bailey : 7/22/2008 1:29:32 PM

SPX 1,260.62
SPY $126.05

Jeff Bailey : 7/22/2008 1:28:59 PM

VIX.X alert! 22.35 ... undercuts MONTHLY Pivot (first time this month)

Jeff Bailey : 7/22/2008 1:17:16 PM

RUT.X ... "correction mode" since 07/16/08

Keene Little : 7/22/2008 1:14:47 PM

For as strong as the RUT looks today, its pattern since the July 7th low looks more like a correction to the decline from early June. The sharp rally from last week could be the completion of an a-b-c bounce which means it's now set up for a continuation lower, as shown on the 120-min chart: Link

Today's rally took it up to its 100-dma at 706.69. Its 50-dma is currently at 715.53 and any higher than that would have the RUT looking much more bullish. Until that happens I'd be leaning short the small caps.

Jeff Bailey : 7/22/2008 1:04:57 PM

TRIN 1.12
TRINQ 1.48

Jeff Bailey : 7/22/2008 1:02:55 PM

NYSE a/d 1,733:1,318
NASDAQ a/d 1,654:1,126

Jeff Bailey : 7/22/2008 1:00:03 PM

Bank of America (BAC) $30.01 +5.07%

Jeff Bailey : 7/22/2008 12:55:06 PM

Internets, I mean banks, continue to hold steady.

Jeff Bailey : 7/22/2008 12:53:17 PM

Russell 2000 (RUT.X) 706.80 +1.31% ... continue to impress. Have retraced just more than 50% of recent 6/05/08 to 07/15/08 decline.

Jeff Bailey : 7/22/2008 12:40:27 PM

JetBlue (JBLU) $4.66 +19.79% (correct percentage). WKLY R1 here.

Keene Little : 7/22/2008 12:38:50 PM

Back in January I was doing some speculating about how the current secular bear market might play out and I was asked for an update today. The two possibilities that I had discussed back then were for either a long drawn out sideways triangle (somewhat similar to the 1966-1982 consolidation) or a steeper decline that ends the bear market quicker. Posted in January: Link

It's messy with the trend channels but the SPX monthly chart shows the two scenarios and the pink one pointed to a drop to a higher low than the October 2002 low by the end of 2009 and then a bounce back up to a lower high sometime around 2013 (and then back down again to finish the triangle pattern in 2016-2018). The dark red scenario is a steeper 5-wave decline from last October to a low by the end of 2009/early 2010.

Breaking the two scenarios apart, I'm showing weekly charts of each below. The pink scenario shows a larger descending wedge idea with a corrective wave count all the way down to a final low near 945 (the October 2002 low was near 769). A rally from here up to about 1320 by the end of August would set up the next big decline to below 1100 before bouncing again. This one is the "corrective bear market decline": Link

This differs from the January chart in that the decline could finish a little higher and a little earlier. The more bearish (bigger decline) scenario shows a 5-wave move down from last October and a bottom at the end of next year near 600 (a little higher than the January chart). This one is the "impulsive bear market decline: Link

This one also calls for a bounce, either from here or after one more minor new low, into August and to the same 1320 area, to then be followed by a fast decline to near 1000 before bouncing into the new year. Both of these scenarios use Fib relationships between the waves, both time and price, but is obviously speculation on my part. For all I know we're not even in a secular bear market although I'm pretty sure about that one.

Jeff Bailey : 7/22/2008 12:34:55 PM

US Oil Fund (USO) $102.57 ... 50-cent box to match futures Link ... continues to ease. Today is August Crude Oil (cl08q) expiration.

Jane Fox : 7/22/2008 12:32:48 PM

NEW YORK (MarketWatch) - The U.S. in July surpassed Germany as the world's largest wind-energy producer, as the business of harnessing electricity from giant turbines continues to pick up momentum on several fronts.

"Wind is now a mainstream power source - it's not just an alternative energy," said Randall Swisher, executive director of the American Wind Energy Association, a lobbying group.

The AWEA is preparing to release a report with specific figures on the U.S.'s new role as the leading wind-power producer. But preliminary data show that the country now generates more electricity from wind than Germany does, though the European nation has more wind turbines in operation.

"The wind in the U.S. is more powerful than in Germany, so we generate more electricity overall," he said.

A little more than 1% of the U.S.'s electricity is produced from wind, compared to figures as high as 20% in Denmark, he said.

However, the U.S. Department of Energy has released data showing that 20% of U.S. electricity could come from wind by 2030. Wind energy figured prominently in the Texas investor T. Boone Pickens's testimony Tuesday to the U.S. Senate Homeland Security and Government Affairs Committee.

Pickens continued to tout what he calls the threat posed by $700 billion a year moving overseas to buy imported oil. He argued that U.S. national security is in its greatest jeopardy since World War II due to its "dangerous dependence on foreign oil."

He repeated his call for more wind power to generate electricity. Instead of fueling electric-power plants, natural gas could be used to power vehicles and reduce oil imports to make gasoline.

Jeff Bailey : 7/22/2008 12:30:21 PM

Most Actives ... QQQQ $44.18 Link , FDRY $18.09 Link , MSFT $25.57 Link , AAPL $152.52 Link , SNDK $13.34 Link , INTC $22.01 Link , UAUA $7.40 Link , CSCO $21.58 Link , AMAT $17.29 Link , SGP $19.23 Link .

Jane Fox : 7/22/2008 12:27:17 PM

WASHINGTON (MarketWatch) -- U.S. home values declined 0.3% in May, falling for the 12th time in the past 13 months, the Office of Federal Housing Enterprise Oversight reported Tuesday.

Home values were 4.8% lower than a year ago, the largest year-over-year decline in the history of the data. Nationally, prices in May were roughly where they were in November 2005. Read the full report.

Prices were lower in eight of the nine regions compared with a year earlier. Only the West South Central states (Oklahoma, Arkansas, Texas and Louisiana) saw a gain over the past year, rising 0.5%. However, prices in the West South Central plunged 1% in May.

After adjusting for inflation, real home values are down in every region.

Prices rose 0.3% in the Pacific states in May compared with April, the first monthly increase in that region since last March, which may be a good sign, said OFHEO Director James Lockhart. Even with May's gain, prices in the Pacific states are down 14.5% in the past year. The Pacific states include Hawaii, Alaska, Washington, Oregon and California.

Prices also rose in May in the Middle Atlantic (New York, New Jersey and Pennsylvania) and the East North Central states (Michigan, Wisconsin, Illinois, Indiana and Ohio).

Jeff Bailey : 7/22/2008 12:23:21 PM

QCharts users ... may need to be aware the Daily percentage changes (%) may not be correct.

QQQQ $44.17 -1.36% (my QCharts showing -3.22%)

Linda Piazza : 7/22/2008 12:23:15 PM

I'll be away from my desk for about an hour.

Linda Piazza : 7/22/2008 12:22:57 PM

The TED spread is now 1.29, its low of the day.

Linda Piazza : 7/22/2008 12:15:56 PM

So far, so good, but the OEX hasn't thoroughly tested that 583-586 zone. It is, however, bouncing strongly enough from its potential support on 15-minute closes on its 15-minute 9-ema, now at 580.30, that's it's turning that moving average higher. Bulls still need to have their plans in place for a test of that higher resistance. The 15-minute chart suggests that the 584.20 area may provide resistance on 15-minute closes, but that if the OEX can get through that, it may rise up to test 586-588. That's a couple of "if" and "may" statements, though.

Keene Little : 7/22/2008 12:15:22 PM

The Trannies rallied big this morning (+3.1%) which has the TRAN at potential resistance at its broken uptrend line from January and the 50-dma, both located at 5112, which it just tagged. The bearish wave pattern calls for a reversal back down so it's another caution for bulls here. But if the TRAN closes above these two resistance points it would obviously be bullish. Link

Jeff Bailey : 7/22/2008 12:14:21 PM

12:00 Internals at this Link

Jeff Bailey : 7/22/2008 12:11:01 PM

AMR Corp. (AMR) $8.87 +24.40% ...

Jeff Bailey : 7/22/2008 12:10:36 PM

Go blue! ... JBLU $4.70 +11.37% ...

Jeff Bailey : 7/22/2008 12:09:53 PM

Goog gravy! ... UAUA $7.59 +40.49% ... #7 most active.

Keene Little : 7/22/2008 11:57:12 AM

QCharts 5.1 now back up. SPX is threatening to break today's uptrend line and the DOW has already done the same. Today's bounce is just a 3-wave correction so far.

Keene Little : 7/22/2008 11:49:11 AM

eSignal says they've fixed their server problem and I can log in with QCharts 6.0 (which of course doesn't transfer all of my saved chart settings, trend lines, notes, etc. from 5.1) but I still can't get in with 5.1.

Jeff Bailey : 7/22/2008 11:49:10 AM

QQQQ $44.24 -3.06% ... below WKLY Pivot.

Jeff Bailey : 7/22/2008 11:47:39 AM

Semiconductor HOLDRs (SMH) $27.97 -6.14% ... below WKLY Pivot and WKLY S1.

Jeff Bailey : 7/22/2008 11:46:41 AM

Loading ... multiple up/downside alerts given.

Linda Piazza : 7/22/2008 11:46:26 AM

The A/D line is currently +483, with the A/D line having charged up through that next level of potential resistance, too. Now equity bulls want to see it hold support at about +250.

Jeff Bailey : 7/22/2008 11:44:48 AM

QCharts loading ... servers may be coming up.

Keene Little : 7/22/2008 11:43:50 AM

Two equal legs up from this morning's low is near SPX 1265.50 so if we're going to remain in some kind of sideways chop that will likely be resistance. And keep an eye on today's uptrend line near 1259 currently. That should hold if we're to continue rallying today. Otherwise stay cautious about the upside.

Linda Piazza : 7/22/2008 11:38:11 AM

About the feed/charting issues some are having: I have to say that since I switched to QuoteTracker using DTNIQ feed, I have had few issues. I did suspect that last week, when prices were dropping quickly, my charts might have been running a bit slow, but that's the first time that's happened, and I don't wake up with no charts as I often did previously. The main issues, however, are a clunkier system and fewer bells and whistles than you'll find on a platform such as QCharts. I also have to say that I don't trade futures or commodities (other than through an ETF with options or something similar), so can't testify to how DTNIQ feed handles that.

Keene Little : 7/22/2008 11:36:02 AM

We've got a real split in today's market. SPX and DOW are up marginally while NDX is down nearly 21 points (-1.0%) and the RUT is up 9 points (+1.3%). Normally a fractured market like this is not a healthy market so it says to be cautious about the long side. It doesn't mean we can't rally for a few days but so far it's not a healthy rally.

Linda Piazza : 7/22/2008 11:33:29 AM

OEX bulls, you know to keep updating your profit-protecting plans as that 583-586 potential resistance zone is approached. I've always thought it possible that the OEX could test its daily 30-sma, and that's now at 588.60. "Possible" doesn't not equate to "done deal," however, so watch that next resistance zone.

Jeff Bailey : 7/22/2008 11:17:25 AM

Internals at both the big board and NASDAQ have improved notably from their 10:00 measure.

At 10:00 the NYSE reported 940 advancers for every 1,874 decliners. At approximately 11:00 AM EDT, that had improved to 1,343 advancing issues compared to 1,750. NH vs. NL were 15:47 and we've seen 5 securities added to the NH list, while 17 have been added to the NL list.

NASDAQ a/d now even with advancers having a slight edge of 1,290:1,288 compared to 971:1,366 an hour ago. 42 stocks have achieved a new 52-week high while 64 have achieved a new 52-week low.

Jane Fox : 7/22/2008 11:15:13 AM

Now I have 4 computers and 6 monitors. I need to give some away.

Jane Fox : 7/22/2008 11:14:09 AM

I got emails from Tradestation saying they are taking their data issues seriously but then said individual traders need to take on some responsibility as well. If you trade Crude you need to have a computer that can handle the vast amount of data in short periods of time.

So I upgraded my computer on the weekend and even bought a 25 inch monitor. Oh my gosh I am so spoilt now.

Linda Piazza : 7/22/2008 11:13:29 AM

Now that the A/D line has done what equity bulls hoped it would do, it is about to slam into potentially strong next resistance at about +300 to +350. It's at +207 as I type.

Jane Fox : 7/22/2008 11:10:40 AM

Keene and Jeff, it does not matter which charting platform you use you will have issues. I thought Tradestation was the most reliable data provider out there but I have some real issues with them as well. I guess I need to qualify that statement though because most of the traders with whom I trade did not have issues, only the Crude traders. When Crude gets moving no computers seem to be able to handle it.

Jane Fox : 7/22/2008 11:05:16 AM

Here are your overnight charts. They show quite clearly the NDX futures (NQ) is your weaker market. Link

Jeff Bailey : 7/22/2008 11:03:36 AM

I've been unable to establish a connection with QCharts this morning. Technical support saying power outages have impacted servers and they are working on those issues.

Keene Little : 7/22/2008 11:01:43 AM

This morning's big bounce back up to the flat line has me wondering who might have been behind it. It's certainly no secret anymore that the Fed and Treasury, joined by SEC, hate short players and will do everything in their power to fry them. If this morning's bounce doesn't hold then we'll have a good idea who engineered it (but they need bulls to give them so follow-through).

With the high short interest ratio and more retail players shorting the market these days it's really a pretty easy game to smack the bears and get them running. You just need a big pot of money to get some buy programs started.

Linda Piazza : 7/22/2008 10:59:28 AM

I linked a Keltner chart on the A/D line to my 10:05:05 post and mentioned that the A/D line had potential resistance on 15-minute closes at the -300 level. The A/D line has risen to test that level but the potential resistance has changed a bit, too. That's now from about -190 down to about -350, with the A/D line now at -366 and so far consolidating at that potential S/R. There's no outcome predicted as yet, with the potential for a further climb if the A/D line can scramble above that -190 area and stay there or potential for a decline if it can't.

Linda Piazza : 7/22/2008 10:51:38 AM

The OEX just completed its first 15-minute close of the day above the 15-minute 9-ema, now at about 578.62. The OEX needs to maintain 15-minute closes above this and begin producing 30-minute closes above its 9-ema, now at 578.91, to keep alive the possibility of rising to test that 583-586 potential resistance zone. OEX bulls should be aware that this could be potent resistance and prepare accordingly.

Keene Little : 7/22/2008 10:50:29 AM

The phone message at eSignal says they're having server "issues". So much for the reliability of eSignal's servers as compared to QCharts. I sure wish QCharts had stayed independent. They were getting their act together before eSignal bought them.

Keene Little : 7/22/2008 10:46:14 AM

For some reason I haven't been able to start my QCharts this morning (I'm still using version 5.1) and therefore cannot update any charts yet. It just sits there and won't give me the login screen. I've tried it on two computers and same result.

Jeff Bailey : 7/22/2008 10:45:01 AM

CBO: "Severe consequences" if GSE help not enacted.

Jeff Bailey : 7/22/2008 10:44:24 AM

OFHEO: US Home prices fall 0.3% from April to May.

Jeff Bailey : 7/22/2008 10:40:51 AM

Congressional Budget Office (CBO) ... Saying U.S. Treasury Department's proposed backstop of Fannie Mae and Freddie Mac could potentially cost the government $25 billion if it is used.

CBO estimates 50% chance that the proposed backstop would not be used before it expires at the end of December 2009.

Keene Little : 7/22/2008 10:32:43 AM

So much for a small consolidation and another new low before a rally back up. The rally back up to the flat line unfortunately leaves both the bullish and bearish scenarios on the table. It could be part of the larger consolidation pattern since last Thursday, which will be followed by another big rally leg, or we're seeing a choppy start to what will become a fast decline. Based on the big bounce back up the bulls do not want to see a new low now as that would be more confirmation of the bearish scenario calling for a return to last week's lows.

Linda Piazza : 7/22/2008 10:28:33 AM

If the OEX keeps climbing, where's next resistance? It's back at that old 583-586 zone, with the short-term Keltner charts echoing the potential resistance we know is there from the March low and historical S/R. First we have to see the OEX maintaining current gains to start looking at further upside targets, however. For example, equity bulls would like to see the OEX close this 30-minute period above 578.60.

Jane Fox : 7/22/2008 10:22:39 AM

OK the VIX just made a new daily low, AD volume spiked and the TRIN fell, that means we had some big buyers come to the market.

Linda Piazza : 7/22/2008 10:22:35 AM

Look at the TRAN go! It's jumped to a new high above last week's, bouncing this morning from its 30-sma. It's at 5053.45 as I type. If you're trading the OEX, SPX or Dow, keep a watch on this, as the TRAN sometimes leads those others. The TRAN is moving up into and slightly through a historical resistance zone in the 5040-ish zone. Bulls want to see it maintain its ascent; bears want it to roll steeply over.

Jane Fox : 7/22/2008 10:23:50 AM

VIX and AD volume are out of sync, these two should be moving opposite to one another. Both are important but I put more emphasis on the VIX. But then you have to factor in the TRIN. I don't usually watch the TRIN but when it is at 1.45 I take note of it. I would not be long or short here, the internals are just too out of whack. Link

Linda Piazza : 7/22/2008 10:17:02 AM

The TED spread is 1.31 on my delayed feed.

Linda Piazza : 7/22/2008 10:16:18 AM

Jane and I are looking at the same time, at the same indicator. Just goes to show you how important these under-the-market measurements can be to follow.

Linda Piazza : 7/22/2008 10:15:41 AM

The TRIN has been bouncing this morning but has hit the 15-minute 9-ema, the average along which it bounced higher yesterday afternoon. So far, that average, now at about 1.33, is holding as resistance on 15-minute closes, with the TRIN now at 1.30, but it's not typical to see prices bouncing at the same time TRIN is doing so. One of the other is likely to succumb to lower values, but I don't know which it's likely to be.

Jane Fox : 7/22/2008 10:13:23 AM

TRIN is a bearish 1.30

Jeff Bailey : 7/22/2008 10:13:16 AM

Anadarko shuts in production of 3 platforms in US Gulf

Linda Piazza : 7/22/2008 10:09:56 AM

If the OEX can't produce 30-minute closes above about 578.50, then it looks as if it's likely to go on testing support, now at about 574.16 on that 30-minute chart.

Jane Fox : 7/22/2008 10:09:53 AM

VIX is making new daily lows support S&P futures (ES) new daily highs.

Jane Fox : 7/22/2008 10:09:17 AM

AD line started out the day at -1496 but has climbed up to -500 now, still bearish but less so.

Linda Piazza : 7/22/2008 10:06:00 AM

New high on the A/D line.

Linda Piazza : 7/22/2008 10:05:05 AM

Keltner outlook on the A/D line: The A/D line hit potential support on 15-minute closes today, held it, and now is climbing. It needs a new high of the day to confirm that holding of support or else this risks just being the A/D line setting up an early range in which it chops around a while, as sometimes happens. Even if it reaches a new high, equity bulls should be aware of potentially strong resistance gathering near -300 and then again near +300. Here's a chart: Link

Linda Piazza : 7/22/2008 9:59:39 AM

The OEX is bouncing right away up through that potential support on 15-minute closes now at about 575.10. It needs to maintain that level into this 15-minute close, however, to say that support has held for a second 15-minute period. The 30-minute chart shows the OEX bouncing almost exactly from the potential support on 30-minute closes now at 574.11. Now, however, bulls need to be able to build on this early action or it remains just one test so far today, perhaps with more to come. OEX at 576.55 as I type.

Keene Little : 7/22/2008 9:54:22 AM

For the bullish scenario (calling for another rally leg once this morning's decline is finished, the quick drop should be followed by a little consolidation and then a final low before it will be ready to rally. SPX 1248 and DOW 11350 (they don't quite match) is potential support for this scenario. Much lower for either and it will start to look more like another multi-day decline in front of us.

Linda Piazza : 7/22/2008 9:51:34 AM

The OEX finished that last 15-minute period at the potential support that extends down to about 575.10 now, but it's already below it and to a new low this 15-minute period, so the conclusion that the support held, which it did, might not mean much unless the OEX bounces quickly back through that potential support level. The OEX is at 574.69 as I type, having dipped down to 574.18, just above the potential support showing up on the 30-minute chart.

Jeff Bailey : 7/22/2008 9:44:33 AM

United Parcel (UPS) $60.10 +1.08% ... Earnings Press Release Link

Jeff Bailey : 7/22/2008 9:38:47 AM

JebBlue (JBLU) $4.06 +4.37% ... Earnings Press Release Link

Consensus was for EPS of -$0.07 on Revenue of $856.03M

Linda Piazza : 7/22/2008 9:35:26 AM

The OEX drops immediately to test that 575-ish zone seen as potential support on 15-minute closes on the 15-minute chart. It's far too early to speculate yet as to whether that support will hold on the 15-minute close, although the OEX is below it as I type. Remain aware of the potential for the OEX to bounce back up to that level by the end of the 15-minute period. The potential support on the 30-minute chart has moved to 574.07. OEX is 574.48 as I type.

Linda Piazza : 7/22/2008 9:32:55 AM

The TED spread spent yesterday afternoon creeping up from its day's low of 1.28. This morning, it's down a little from yesterday's close, but down only to 1.31.

Linda Piazza : 7/22/2008 9:29:57 AM

Yesterday, I mentioned the possibility that the OEX could be in the process of hacking out a consolidation zone in which it might trade for a week or more before deciding next direction. That's not a given, and I was wrong once before, back about the 23rd of June, when I thought the OEX might chop around at that time before deciding next direction.

If the OEX does set up a consolidation zone, I thought that zone might eventually range from daily closes at or above the 10-sma on the downside and at or below the still-descending 30-sma on the upside. I thought it might be about the same width as the range in which it chopped around from late June into early July. Yesterday afternoon, I noted that if the OEX were to decline steeply, those who hoped it would eventually break higher had as an ultimate goal sustained daily closes above the 10-sma. This morning, with futures down sharply, that's still an ultimate goal. In fact, the preference would be if potential Keltner support now at 575-576 held on daily closes. The 10-sma is lower, at about 572.20 as I type.

Extrapolating where the OEX might go in early trading from the distance of S&P futures from their fair value is a risky business because cash prices don't always go where the futures suggest they will, although they've been pretty good predictors lately. However, if the OEX did move in accordance to that extrapolation process, we could expect to see it move down to test potential support on 15-minute closes now at 575.19-575.80, but likely to move lower if the first push is down and strong. As of yesterday's close, that support looked firm, so bears should think about how they'll adjust their profit-protecting plans if that level should be hit. However, nothing on a 15-minute chart is going to stop the OEX cold if this is to be an extreme down day, which we don't know yet. The next potential support shows up at 573 and again at 570, but if those don't hold, the 15-minute chart suggests that 559-560 could be tested. I hesitate to mention those lower potential targets because they haven't been set and might not be set, and I know that some traders tend to hang on, wanting every cent of that so-called promised (when it hasn't been) target, ignoring the signs that their trades are going very wrong. Keep in mind the bounce potential that's to be seen near 575, 572-573 and again at 570.

Bulls, of course, want the higher of those to hold and for this morning's weakness to be nothing but the OEX zigzagging through the upper or bullish portion of its Keltner channels on its 15-minute chart. They should recognize from the get-go this morning, however, that there's the potential that, even if that 575-ish area is going to hold as support, there's the potential that the OEX could end the day near there.

Jeff Bailey : 7/22/2008 9:28:36 AM

Freeport McMoran (FCX) Earnings Press Release Link

Jeff Bailey : 7/22/2008 9:26:54 AM

Baker Hughes (BHI) Earnings Press Release Link

Jeff Bailey : 7/22/2008 9:26:01 AM

Halliburton (HAL) Earnings Press Release Link

Jeff Bailey : 7/22/2008 9:23:55 AM

Caterpillar (CAT) Earnings Press Release Link

Jeff Bailey : 7/22/2008 9:20:48 AM

DuPont (DD) Earnings Press Release Link

Jane Fox : 7/22/2008 9:17:39 AM

Here are your overnight charts. As you can see the Russell 200 futures (ER2) is the only market to stay above its previous day lows. Link

Jane Fox : 7/22/2008 8:51:51 AM

WASHINGTON (MarketWatch) -- The federal government and the private sector are proceeding apace toward resolving turmoil in the nation's financial and housing markets, Treasury Secretary Henry Paulson said Tuesday.

"I believe that the United States is on the right path to resolving market disruptions and building a stronger financial system," Paulson said in a speech delivered at the New York Public Library. He's been in New York seeking to rally Wall Street support for his plan to throw Fannie Mae and Freddie Mac a financial lifeline. Paulson asked the public to be patient as regulators and institutions work through the challenges.

"Working through the current turmoil will take additional time," Paulson said. He said there would be more "bumps in the road," citing as an example the questions swirling the fiscal safety of Fannie Mae and Freddie Mac.

"I am well aware that financial market and housing challenges continue to concern America's families. Progress will not come in a straight line, and we need to remain patient as we work through these challenges," Paulson said. Paulson said that until the housing market stabilizes, continued stresses in the U.S. financial markets should be expected.

Keene Little : 7/22/2008 8:36:34 AM

After dropping sharply after the bell yesterday (bad AAPL) equity futures ran relatively flat during the overnight session. After the cash market opens we'll see whether or not the support I mentioned last night comes into play.

Market Monitor Archives