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Jeff Bailey : 7/25/2008 1:40:37 AM

01:38:20

Jeff Bailey : 7/25/2008 1:39:29 AM

Time calibration ... 01:37:10

Keene Little : 7/24/2008 11:06:26 PM

Friday's pivot table: Link

With the hard selling pretty much into the close on Thursday we should find out early whether or not it was short-term capitulation, which is often the case, to be followed by a reversal. A gap up morning would catch a few shorts napping. But that's just speculation on what could happen.

Watching the blue chip indexes I've been thinking we'll see a pullback (obviously that started on Thursday) followed by another rally leg into early August, perhaps up to SPX 1320/DOW 12K. After reviewing the charts of the stronger performers over the past week I'm now not so sure about that expectation. As stated in tonight's newsletter I think there's a good chance we've seen all we're going to see for the bounce off the July 15th low.

Some of the reversals today look too strong to be just pullbacks, or at least that's my concern. That and the fact that the bounce in some of the stronger indexes (RUT) and sectors (financials, home builders) look complete. On top of that we've had weak techs (semiconductor holders made a new monthly low). All combined it gives me a more bearish feeling than I've had all week. So I thought it prudent to issue a warning that we could see the market start to sell off again.

Even the VIX gave us a bounce off support (uptrend line from December 2006) with a morning star reversal pattern: Link . A bullish VIX is of course bearish for stocks. The RUT counts well as complete in its bounce and had the opposite candlestick reversal pattern--an evening star: Link . The brokers index (XBD) stopped dead at its downtrend line from October and left another evening star reversal: Link . Home builders had a big bearish engulfing candle (engulfing the past two days of trading. The Transports had another evening star followed by a big down day and shows a failure at its broken uptrend line: Link

It's hard to feel even short term bullish after seeing those. But we'll let price show us the way. Right now I wouldn't be surprised to see a bounce on Friday but then another leg down as part of a larger pullback (Thursday's impulsive decline suggests that's what we'll see at a minimum). Assuming we'll get that kind of move down, the SPX 120-min chart shows either a continuation lower or a bounce off its broken downtrend line from May (near 1235): Link . Either scenario is short term bullish after the decline but the above charts have me wondering about that. Stay on your toes.

OI Technical Staff : 7/24/2008 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 : 7/24/2008 9:28:15 PM

Global Equity Indexes, Currencies, Oil, Gold & $HUI.X at this Link

Would be 3DyNet% 07/21/08-07/24/08.

Jeff Bailey : 7/24/2008 9:12:36 PM

Closing U.S. Market Watch at this Link

As noted in Wednesday's wrap, 5DyNet% and 20DyNet% may not be date accurate.

Jeff Bailey : 7/24/2008 9:06:58 PM

Closing Internals found at this Link

Jeff Bailey : 7/24/2008 5:25:46 PM

Setting an action alert on SPX at 1,295 and 1,242

Jeff Bailey : 7/24/2008 5:03:52 PM

DXY's 04:00 tick was 72.80

Jeff Bailey : 7/24/2008 5:01:17 PM

Integra Bank (IBNK) $10.13 -0.88% ... Halted for trade.

Earnings Press Release Link

Jeff Bailey : 7/24/2008 4:58:35 PM

BAC $30.64 -8.37% ... seeing 1.26 million crossed in tonight's extended at $30.64

Jeff Bailey : 7/24/2008 4:54:51 PM

Could be the "exhaustion gap" for CROX $8.93 -9.61% Link tomorrow morning. $4.43 extended on headline numbers.

Breakdown $55, running $12.50, then "exhaustion" ...

Jeff Bailey : 7/24/2008 4:23:18 PM

SPY $124.43 -2.13% ... 1 million crossed exteded at $125.51.

Keene Little : 7/24/2008 4:22:10 PM

Linda, I hadn't looked at the Trannies today and your chart (3:55 PM) says it all. So much for economic growth if the Trannies give up the ghost. That rally was all airlines and with the airlines selling off strong today (-11.1%) it's just taking the Transports right back down.

Jane Fox : 7/24/2008 4:14:55 PM

I suspected the SPX would fall today but geesh not this much. Link

Jane Fox : 7/24/2008 4:13:08 PM

Tomorrow's Economic Reports include:

8:30a.m. June Durable Goods: Expected: -0.5%. Previous: 0%.

9:55a.m. End-July Reuters/U Mich Sentiment Index: Expected: 56 Previous: 56.4.

10:00a.m. June New Home Sales: Expected: -0.4%. Previous: -2.5%.

Jeff Bailey : 7/24/2008 4:10:44 PM

XOM $80.80 -0.23%, CVX $82.00 -0.78% and COP $81.79 -0.04% fractions lower.

Jeff Bailey : 7/24/2008 4:09:17 PM

Occidental Petroleum (OXY) $73.34 +1.55% ... on stock in my energy watch list to show a gain by the close.

Linda Piazza : 7/24/2008 3:59:47 PM

Here's what the OEX's short-term charts show: the OEX is ending the day testing potentially strong support on the 30-minute chart that extends down to 578.23. Barring a gap below that tomorrow morning, the OEX could attempt to bounce from it. If it does, watch for rollover potential near 582 but stronger at 583.50-585. The OEX's reaction to that level may tell the tale. Remember that after such large-range days, we often see a small-bodied candle produced the next day, with or without upper and lower shadows. Bears must consider what such a day would do to their options trades, particularly with a weekend's premium decay ahead for those long options. It's just one possibility but one that must be considered.

Linda Piazza : 7/24/2008 3:56:11 PM

Tab, it was "interesting" ninety minutes ago and "decisive" now!

Linda Piazza : 7/24/2008 3:55:34 PM

This is the TRAN's chart, with a classic three-candle evening star reversal pattern: Link

Keene Little : 7/24/2008 3:48:12 PM

So far it's not looking like we're going to get a bounce into the close. The downside target just below SPX 1254 has been met and the wave count for the move down from yesterday's high now counts complete, although it could certainly extend lower. So it should be ready to bounce back up at any time.

If it doesn't bounce before the close it could rally out of the gate tomorrow morning so consider that possibility if you'll be carrying a short position overnight. Remember how many times we've seen the market finish at the high or low of the day only to do a hard reversal the following morning. Once the short-term traders have capitulated into the close it seems to set the market up for a reversal the following day.

Tab Gilles : 7/24/2008 3:45:38 PM

Linda, you mentioned "interesting" in your 2:29 post. Would the word "decisive" be best suited?

Linda Piazza : 7/24/2008 3:41:06 PM

If the OEX were to end the day at or below the 581.60 level, it will have retraced at least half of Tuesday's range. Although no classic reversal signal has been produced--which would have required a smaller body on yesterday's candle and an open at or below yesterday's open today--that would suggest reversal rather than consolidation. It would also produce a close below a rising trendline beneath the 7/15 and 7/22 lows or a best-fit trendline drawn from the 7/15 and 7/16 lows and through the shadow beneath the 7/22 low.

However, I've mentioned in the past that I prefer to watch the daily 9-ema along with the 10-sma, and the OEX is just now testing the 9-ema, at just under 581. Potential reversal signal on the candlesticks or not, there's the potential for this moving average to serve as support, or, if its support is lost soundly enough today, for it to serve as resistance if tested tomorrow. Keep in mind the possibility that the OEX is hammering out a wider rising bear flag in which it will climb until an ultimate failure. If that happens, the OEX might not follow through with a retest of the 570 level, which would be the next potential downside target if this daily support is lost.

It's time for bears who have profits under their belts today to begin assessing whether they feel comfortable holding all their positions overnight or whether they need to lock in partial or all profits. I wanted this information to be available.

Jeff Bailey : 7/24/2008 3:35:16 PM

BAC $31.18 -6.75% ...

Jeff Bailey : 7/24/2008 3:34:45 PM

ProShares UltraShort Financials (SKF) $130.47 +11.60% ... retraces 19.1% of recent decline.

Linda Piazza : 7/24/2008 3:09:22 PM

I had mentioned in my 11:02:54 post that the TED spread's 6/27 close was 1.132, so that the TED spread possibly had support at that level. The TED spread had been declining steeply and was then at 1.15. It did drop to a 1.13 low and is now 1.16, so that possibility of support at 1.13 does exist. As I mentioned earlier, I'm hampered in my charting of the TED spread because my feed provider does not provide a quote and I have to rely on the charting abilities provided by Bloomberg. That doesn't include the ability to draw trendlines or include Keltner studies or even chart using candlesticks, my preferred charting method.

Jeff Bailey : 7/24/2008 3:09:12 PM

Most Actives ... WM $3.79 -18.49%, QQQQ $45.20 -0.37%, QCOM $53.55 +19.03%, WB $16.14 -8.55%, C $19.46 -7.85%, MSFT $25.64 -2.98%, FRE $9.24 -14.44%, SIRI $2.54 -5.22%, UYG $21.51 -9.12%, LVLT $3.34 -6.17%

Linda Piazza : 7/24/2008 3:04:56 PM

I'm glad that I went ahead and mentioned that the OEX was setting potential downside targets at 585 or even 583 in my 10:16:55 post. Those targets seemed tenuous at the time, but this is one of those days when prices just keep stair-stepping down from one potential downside target to the next, and then you look at a daily chart and see how big the decline has actually been. The OEX now has a potential downside target on the 30-minute chart, as I've been mentioning the last few minutes, at 578.56-579, but if it can somehow scramble back above 585 and maintain values above that, then that potential target no longer looks so viable. For the time being, though, bulls should watch for rollover potential from about 583.50 up to 585.

Linda Piazza : 7/24/2008 3:00:19 PM

The A/D line is still headed down. So is the OEX.

Jeff Bailey : 7/24/2008 2:57:26 PM

BAC-TG $4.45 x $4.55

Jeff Bailey : 7/24/2008 2:56:26 PM

BAC-TS $0.05 x $0.06

Jeff Bailey : 7/24/2008 2:55:28 PM

BAC $31.18 -6.72% ... retraces 19.1% of recent advance.

Linda Piazza : 7/24/2008 2:52:01 PM

U.S. companies reporting before the open tomorrow include ACI, ATE (2:00 am ET), CRDN, HMC (2:00 am ET), IFX (4:00 am ET), LM, NFLX, NS, SRP, and perhaps a number of other companies that might prove important. Many, such as BDK that gives us an insight into consumer habits, show "Time Not Supplied," so may be reporting before the bell.

Linda Piazza : 7/24/2008 2:47:02 PM

The OEX has now set a new potential downside target at 578.44-579.00. This is also potential support on 30-minute closes. Because of what I'm seeing on the A/D line, that extreme trending under 30 on RSI on the 15-minute chart, I agree with Keene that bears need to keep adjusting their just-in-case stops.

Linda Piazza : 7/24/2008 2:44:50 PM

Companies reporting after the close today include BJRI, BMC, CLS, EMN, IBKR, JJSF, LSCC, MCRL, MCHP, PXLW, PWER, VSEA, WRE, YRCW, and maybe a host of other companies I should have mentioned but missed. I don't tend to follow the energy companies as closely as some do, for example, and may miss a big player or a company that's important to the sector.

Keene Little : 7/24/2008 2:43:59 PM

SPX is working its way lower but if you're short the market and want to protect profits against any bigger bounce today you should now be pulling your stop closer. We should put in a bottom soon. I've got a projection down to just under SPX 1254 for the 5th wave (to equal the 1st) in the move down from yesterday's high. Once we put in a low for this leg down I'll be able to figure out an upside target zone for the bounce.

Linda Piazza : 7/24/2008 2:37:31 PM

What happens overnight tonight? Tonight, Japan receives some important economic information: the Tokyo and National CPI's. Those will be released at 7:30 pm ET. The services form will be released about 20 minutes later. In the wee hours of the morning, Germany's Import Price Index will be released at 2:00 am ET, the Eurozone's M3 Money Supply at 4:00 and the U.K.'s preliminary GDP at 4:30.

Linda Piazza : 7/24/2008 2:32:27 PM

The TRIN is doing some zooming today. Over the last 15-minute period, it has dropped from 1.60 to a little below its current 1.26. There's potential support at 1.29 on 15-minute closes or at 1.15. Today, the TRIN has not closed a 15-minute period below the potential support now at 1.15, so a 15-minute close beneath that would give bears a heads up to pay attention.

Linda Piazza : 7/24/2008 2:29:13 PM

We once had a subscriber who objected to our use of the word "interesting" in our observations. I agree: although I was guilty as the next of overusing that word in a time when the action proved perplexing to one and all and there seemed nothing else to say, the word can be considered trite. However, I have to say that the last ninety minutes of this trading day could prove interesting! The potential for a confirmed reversal signal in the OEX as well as some other indices exists, but so does a bounce high enough to turn potential reversal into mere consolidation. An OEX close at or below 581.60 suggests reversal and a close at or above the 30-sma currently at 587.11 suggests consolidation, believe it or not. Between there? That's going to be the conundrum.

Jeff Bailey : 7/24/2008 2:23:32 PM

US Nat. Gas Fund (UNG) $1.25 box size Link ... looks to be about the best match for futures.

Linda Piazza : 7/24/2008 2:20:30 PM

Now the OEX has dropped down to test the lowest of the potential targets I've been mentioning today, with that target and potential support on 15-minute closes now at about 583.50. The OEX is 583.45 as I type. If this support is lost on 15-minute closes, the next potential target looks to be in the 578.30-578.80 zone. A close today at or below 581.60 would look as if reversal potential was being confirmed. Bears should keep in mind, however, the potential for the current support to bounce the OEX higher again, perhaps back toward the daily 30-sma, and keep adjusting their stops as the OEX moves lower.

Jeff Bailey : 7/24/2008 2:17:29 PM

02:00 Internals at this Link

Tab Gilles : 7/24/2008 2:16:57 PM

$VIX 22.52 +1.21 (5.73%)

$VXN 27.23 -0.21 (0.51%)

$RVX 29.29 +1.72 (5.96%)

Tab Gilles : 7/24/2008 2:05:30 PM

Vasco Data Security (VDSI) $13.41 +$1.93 (16.6%)

VASCO Data Security International, Inc., through its subsidiaries, engages in the design, development, marketing, and support of hardware and software security systems that manage and secure access to information assets worldwide. Their primary customer are financial and brokerage companies. Link Link

Charts Link Link

Linda Piazza : 7/24/2008 2:03:38 PM

Potential support for the OEX on 15-minute closes has now drifted back down a bit, now at 583.59-584.02. The OEX is 584.99 as I type, testing a Keltner line that had served as support on 15-minute closes, but this time from the underside.

Jeff Bailey : 7/24/2008 2:00:15 PM

I "like" the honoring of the Bullish Triangle pattern from March and April.

Jeff Bailey : 7/24/2008 1:58:47 PM

UNG $43.37 -5.07% ... "default" box size Link

Jeff Bailey : 7/24/2008 1:57:02 PM

Sep. Nat Gas (ng08u) ... $0.20 box ... Link

Now get UNG to "look like this."

Jeff Bailey : 7/24/2008 1:53:29 PM

That's exactly where I'm looking.

Jeff Bailey : 7/24/2008 1:53:08 PM

S&P 500 trader on CNBC mentioning his buying points. Sounds like a pivot trader.

Jeff Bailey : 7/24/2008 1:48:23 PM

Looking to answer email question. Will note that Sep Nat. Gas did trade its bullish support trend $9.00 intra-day.

Question, which I'm about to answer, is "What scale do we use for UNG to match Dorsey's futures charts?"

Keene Little : 7/24/2008 1:47:59 PM

Looking at the 10-min chart of SPX you can see a 3-wave move down from yesterday's high and now we're going sideways. If the sideways consolidation continues for a bit more it will look like a 4th wave. That would suggest another drop lower in the 5th wave this afternoon (with a downside projection near 1255).

An impulsive 5-wave decline would confirm at least a short term trend change to the downside. We'd get a bounce following the 5-wave move down (to correct the decline from yesterday) but then it would be followed by another leg down to match the one from yesterday's high. This updated 30-min chart shows how it might look for a drop down to about 1235 (for a retest of the broken downtrend line from June 5th) by Monday: Link

Linda Piazza : 7/24/2008 1:45:20 PM

The A/D line is about to retest its day's low of -1563. Just another place to watch, as the A/D line could either bounce from this equal-low test or fall through that support, adding to the bearish tenor. As I said earlier, I don't recall seeing the RSI on the A/D line's 15-minute chart trend so low for so long, not even in the terrible days we've had lately, so I'm on the lookout for RSI to turn up, to see if the A/D line just moves sideways while it does or actually bounces.

Note: As I typed, the A/D line dropped to a new low, but it's not far from the previous low as yet.

Jane Fox : 7/24/2008 1:43:05 PM

ES and the VIX are in sync today. Link

Jane Fox : 7/24/2008 1:40:08 PM

AT 11:56ET the TRIN hit 2.00. There are many traders who will fade a TRIN 2.00 - that means they will buy the market. I see ES hit a low at 12:40 and then retested that low at 1:10 so I don't think the strategy would have worked today.

Jeff Bailey : 7/24/2008 1:39:23 PM

USO $101.61 +1.58% Link ... would be 3-box reversal at this point. Session low has been $99.57.

Jane Fox : 7/24/2008 1:34:51 PM

CHICAGO (MarketWatch) -- Mortgage rates spiked this week on inflation fears, with the benchmark 30-year, fixed-rate loan soaring more than a quarter percentage point to a national average 6.63%, its highest level in nearly a year, Freddie Mac said Thursday.

"Market concerns about rising inflation, further weakness in the housing market and greater probability that the Federal Reserve will raise short-term rates this year all combined to push mortgage rates higher this week," said Frank Nothaft, Freddie Mac chief economist.

The 30-year loan hit 6.68% on Aug. 7, 2007, the last time it was this high. Despite turmoil in the financial sector, mortgage rates have largely held steady as demand for housing remains weak. Existing-homes sales are at a 10-year low, the National Association of Realtors said Thursday. See Economic Report.

Keene Little : 7/24/2008 1:34:15 PM

Those that were sold off the hardest into last week's low experienced some of the strongest buying in the past week (think banks, home builders and airlines). Short covering can provide some powerful buying. Today we're seeing renewed selling in those sectors as they lead to the downside (BIX -5%, builders -10%, airlines -9.6%).

Jeff Bailey : 7/24/2008 1:34:09 PM

SPY $126.70 -1.14% ...

Jeff Bailey : 7/24/2008 1:33:52 PM

VIX.X 22.40 +5.11% ... MONTHLY Pivot here.

Jeff Bailey : 7/24/2008 1:29:46 PM

BAC $32.23 -3.61% ... 19.1% retracement of recent advance untested at $31.23.

Jeff Bailey : 7/24/2008 1:28:23 PM

JPM $40.38 -3.76% ... 19.1% retracement of recent advance. Still see JPM as "best of breed"

Jeff Bailey : 7/24/2008 1:27:27 PM

5-year auction results posted.

Linda Piazza : 7/24/2008 1:26:54 PM

The OEX's 15-minute 9-ema, potential resistance on 15-minute closes, is now at 586.31. The 30-minute version is at 587.47, just above the daily 30-sma.

Jane Fox : 7/24/2008 1:21:11 PM

SAN FRANCISCO (MarketWatch) -- Crude-oil futures wavered in a narrow range Thursday around the previous session's close, following their $20 decline over the past seven sessions that had sent the benchmark contract to its lowest in seven weeks.

Meanwhile, natural gas prices slumped more than 8% after government data showed U.S. inventories rose more than expected last week, adding downward pressures on crude.

Crude oil for September delivery was last down 37 cents to $124.07 a barrel on the New York Mercantile Exchange. Earlier, the contract rose to an intraday high of $126.01 a barrel but also fell to an intraday low of $123.50.

New tensions in Nigeria, the fifth largest foreign oil supplier to the U.S., supported crude prices, while the dollar's recent firmness weighed on their upside.

The Associated Press reported late Wednesday that Nigeria's main militant group -- the Movement for the Emancipation of the Niger Delta, or MEND -- has threatened to destroy the African nation's major oil pipelines within 30 days to counter claims that it had struck a $12 million deal with the government to protect them.

Jeff Bailey : 7/24/2008 1:12:15 PM

BAC $31.68 -5.23% ... PnF chart Link

Linda Piazza : 7/24/2008 1:12:12 PM

The OEX is approaching that potential target and support on 15-minute closes, with that now at 583.48-584.31. It's just another place to watch for potential support and for bears to update their profit-protecting plans. So far, there's been no change in tenor, but we can't yet rule out the possibility that the OEX will regain the daily 30-sma's potential support by the day's close. As noted in my 9:17:05 post this morning, however, a close at or below 581.60, the 50% retracement of Tuesday's range, would confirm a potential reversal signal on the OEX's daily chart. We've all seen times when the only reversal was the candle needed to confirm that reversal, but in this climate, bulls may quickly bail if this rally were to fail too quickly.

Jeff Bailey : 7/24/2008 1:02:55 PM

SPX Heavyweights (as of 07/21/08 open) with live trade at screen capture Link

Looking for some near-term retracement of gains in BAC. 16% decline near-term may be found.

At this morning's open BAC was #9 most heavily weighted at 1.36%.

Jeff Bailey : 7/24/2008 12:59:28 PM

JPM $40.07 -4.50% ...

Jeff Bailey : 7/24/2008 12:59:10 PM

VIX.X 22.37 +4.97% ...

Jeff Bailey : 7/24/2008 12:55:23 PM

Disclosure: I currently hold bearish position in BAC.

Jeff Bailey : 7/24/2008 12:55:02 PM

Swing trade put alert! ... for one (1) of the Bank of America BAC Aug. $35 Puts (BAC-TG) at the offer of $4.00.

BAC $32.05 -4.16%.

Jane Fox : 7/24/2008 12:50:06 PM

Ad Line is -1421 but has made a low of -1545 so no doubt who is winning today.

Linda Piazza : 7/24/2008 12:41:53 PM

The A/D line is still moving down. All it needs now is to move sideways/down or even just sideways to preserve the negative tenor of the day. However, I don't remember seeing the A/D line's RSI (15-minute chart) trend so long at sub-30 levels for a long time, not even on 7/14, for example. It's at extreme levels then. From a contrarian viewpoint, bears should remain on their toes and watchful for bounce potential. If RSI does bounce, bears want to see the A/D line move sideways as it does. A/D line at -1556 as I type.

Linda Piazza : 7/24/2008 12:33:10 PM

Potential OEX support on 30-minute closes is now about 585.37. Although other charts show a possibility of a test of a lower target, now at 583.40-584, bears should have those just-in-case profit-protecting plans updated now in case a bounce gets started.

Jeff Bailey : 7/24/2008 12:26:16 PM

IWM $70.99 -1.30% ... just below DAILY S1 ($71.11) and WKLY R1 (71.08), DAILY S2 ($70.50) untested at this point.

Jeff Bailey : 7/24/2008 12:24:11 PM

DIA $114.91 -1.13% ... also sitting on DAILY S2.

Jeff Bailey : 7/24/2008 12:22:00 PM

SPY $126.82 -1.05% ... sitting on DAILY S2.

Jeff Bailey : 7/24/2008 12:20:35 PM

12:00 Internals found at this Link

Note: 10:00 a/d were likely incorrect.

Keene Little : 7/24/2008 12:32:51 PM

As expected we've seen a small bounce/consolidation and we should see another new daily low. But SPX 1262-1263 still looks like it should be a good support area for a bigger bounce back up today.

Linda Piazza : 7/24/2008 12:12:55 PM

The OEX still has a potential downside target and potential support on 30-minute closes now at 585.40. However, support may be firming just a bit so it's possible that the OEX won't actually drop into that support. The outlook is a bit iffy at the moment, with some charts showing the potential for a drop to that level and perhaps even closer to 583 and some showing that support may be firming now.

Linda Piazza : 7/24/2008 12:10:33 PM

No, Jeff, I use DTNIQ.

Jeff Bailey : 7/24/2008 12:08:03 PM

Linda! Thank you. What service provider are you using?

Not QCharts I take it.

Jeff Bailey : 7/24/2008 12:06:45 PM

At last night's close, Nymex August Nat Gas had 49,922 open interest.

Sep was 125,815

Tab Gilles : 7/24/2008 12:03:28 PM

Yamana Gold (AUY) $12.72 Link

$GOLD Link

Linda Piazza : 7/24/2008 12:02:28 PM

Jeff, on the Nasdaq, I'm showing 1158 advancers and 1516 decliners.

Linda Piazza : 7/24/2008 12:01:34 PM

Jeff, I don't know about Jane, but I'm showing NYSE advancers at 887; decliners, 2222. Hope that helps.

Jeff Bailey : 7/24/2008 12:01:05 PM

Remember! Though I "rolled" energy futures to September at the expiration of August crude oil, August Nat. Gas doesn't expire until 07/29/08 (Tuesday)

Linda Piazza : 7/24/2008 11:58:30 AM

The OEX came within a few cents of the potential support on 30-minute closes now at 585.34, but didn't touch it before bouncing. I'm rolling down to the 10-minute chart now because so far, the 10-minute chart's 9-ema has been providing resistance on 10-minute closes all day today. That average is now at 587.37, near the daily 30-sma. Bears want that to serve as resistance again, while bulls want sustained levels above it as a first and tentative sign of any improvement in tenor at all. The OEX is 586.81 as I type.

Jeff Bailey : 7/24/2008 11:57:05 AM

Good gravy ... Nat. Gas getting hammered.

Jeff Bailey : 7/24/2008 11:54:41 AM

No alert! ... Yhoo Finance, though delayed ...

NYSE a/d 863:2,388

NASDAQ a/d 1,060:1,592

Jeff Bailey : 7/24/2008 11:53:01 AM

TRINQ 1.72

Jeff Bailey : 7/24/2008 11:52:52 AM

NASDAQ Composite ... 3,304 -0.93% ...

Jeff Bailey : 7/24/2008 11:52:26 AM

TRIN 1.74 ...

Jeff Bailey : 7/24/2008 11:52:11 AM

NYSE Composite ... 8,463.51 -1.36% ...

Jeff Bailey : 7/24/2008 11:51:28 AM

Jane! Are you showing NYSE a/d at 2,213:818?

NASDAQ 1,581:1104

or anywhere close?

Jeff Bailey : 7/24/2008 11:48:07 AM

It's never "easy" is it?

One can "assume" JBLU moves conter-trend to oil.

But you know what they say about ass-u-me.

One reason we've got an offsetting stock position should oil prices crater, but JBLU suffer anyway.

Jeff Bailey : 7/24/2008 11:45:34 AM

Moody's downgrades US Air, JetBlue ... AP Story Link

Jeff Bailey : 7/24/2008 11:43:57 AM

LUV made money. BIG hedger of oil/fuel prices.

Jeff Bailey : 7/24/2008 11:43:30 AM

Southwest Airlines (LUV) $15.54 -2.14% ... Earnings Press Release Link

Tab Gilles : 7/24/2008 11:41:41 AM

JP MorganChase (JPM) $40.39 -$1.50 (3.79%)

Finding resistance at the 200-ma /$42 level. Link Link

Jeff Bailey : 7/24/2008 11:40:31 AM

TSO $15.77 -5.39% ...

Jeff Bailey : 7/24/2008 11:40:16 AM

VLO $31.97 -4.79% ...

Jeff Bailey : 7/24/2008 11:40:03 AM

If using USO and UGA to derive a "crack spread" ratio, just be aware.

Linda Piazza : 7/24/2008 11:39:47 AM

I forgot to mention it yesterday, but I used yesterday's pop higher to close out some of my AUG bull put spreads for $0.15-0.20 (15 AUG RUT 600/590's, 15 AUG SPX 1090/1080's, and 11 AUG XEO 520/510's). I know some of you object to giving up that much of your potential profit, but if you're overloaded with bull put spreads and worried about rollover potential, you could consider closing out partial positions and reducing risk, even if you didn't want to close out all. If you're not worried and feel confident of your ability (and your account's) to withstand a downdraft or don't believe one is coming, then this advice perhaps isn't right for you. I am confident of my ability in anything but a runaway or fast market, when ability doesn't count, but I don't want to risk paying $1.50-2.50 to exit going-wrong bull put spreads if I could have closed them out and locked in some profit for a $0.15-0.20 debit. Not in this environment.

Jeff Bailey : 7/24/2008 11:39:14 AM

Not getting accurate reports/feed from UGA.

My Ameritrade Level II $56.55 x $56.62 and moving. However, it shows "last" at $56.33 (last night's close).

Jeff Bailey : 7/24/2008 11:36:45 AM

PBR itself has played "catch up" from USO and PBR entry points.

Jeff Bailey : 7/24/2008 11:35:06 AM

Here's how the IYS-TO, PMT-TI and JGQ-HZ look currently Link

Linda Piazza : 7/24/2008 11:34:01 AM

A/D line to a new low. However, it's getting extreme as measured on the 15-minute chart, with an RSI that's been trending just above 10.00 all day. Therefore, bears need to be watchful of potential support kicking in for the A/D line, which could then stall the slide down in indices such as the OEX and perhaps bounce it back above that daily 30-sma. That's just something to watch out for and not a promised action. A/D line is now -1405.

Keene Little : 7/24/2008 11:33:53 AM

SPX has confirmed the DOW's break of the uptrend line from July 15th. That's the signal that that leg up is finished and now we're correcting it (or more bearishly, we're starting a leg down for a retest of the July low). We should get another little consolidation like the one shortly after 10:00 AM and then another new low for today. SPX should find some support in the 1262-1263 area (previous highs of consolidation from last Thursday's high).

Tab Gilles : 7/24/2008 11:33:33 AM

Chesapeake Energy (CHK) $45.50 -1.47 (3.07%)

CHK & $NATGAS close to support levels. Link Link Link Link

Jeff Bailey : 7/24/2008 11:28:59 AM

At last night's close, here's how the one (1) NAKED IYS-TO, two (2) long (PMJ-TI) and one (1) long JGQ-HZ finished. Link

"Security Trade" was where the underlying security of USO, PBR and JBLU finished. The "Entry B" is the price of each security when the option trade was established.

Linda Piazza : 7/24/2008 11:28:21 AM

The OEX is again testing the daily 30-sma. If the OEX continues dropping, next potential support for the OEX on 30-minute closes is at about 585.30. The 15-minute chart shows that there's potential vulnerability to 583-583.50, too, but that's only vulnerability and not a promised target.

Linda Piazza : 7/24/2008 11:16:20 AM

RUT to a new daily low.

Jeff Bailey : 7/24/2008 11:16:18 AM

PBR $53.85 -3.52% ...

Jeff Bailey : 7/24/2008 11:16:02 AM

JBLU $5.09 -3.04% ...

Jeff Bailey : 7/24/2008 11:15:38 AM

USO $99.93 -0.08% ...

Jeff Bailey : 7/24/2008 11:15:08 AM

If still overly long, maybe they will "bully" and "hammer" to the downside? You probably wouldn't see an investigation then though.

Linda Piazza : 7/24/2008 11:15:00 AM

The BIX is not falling steeply but is instead still in the consolidating range. It needs to lose potential support at about 183 and remain well below it to be doing anything more than consolidating. If it should drop below and sustain values below that level, then OEX traders should watch for the potential that the OEX is doing something different from just consolidating, too. The BIX is 188.87 as I type.

Jeff Bailey : 7/24/2008 11:13:29 AM

I'd call it trading.

Jeff Bailey : 7/24/2008 11:12:32 AM

CFTC said Optiver would "bully" and "hammer" markets.

Keene Little : 7/24/2008 11:11:57 AM

Crude is showing some bullish divergences on the short term charts and it looks like it could be due a correction of its decline from the July 11th high. But so far it's on track for what should be a relatively quick decline to the $90-$100 area, possibly by September. Daily chart: Link

Jeff Bailey : 7/24/2008 11:11:28 AM

Optiver is a privately held trading group.

Jeff Bailey : 7/24/2008 11:10:43 AM

CFTC: Optiver charged with manipulation of crude oil, gasoline, heating oil markets.

Jeff Bailey : 7/24/2008 11:05:08 AM

August "Max Pain" Theory Tabulations at Wednesday's close. Link

Note: Does not compensate/include impact of DJX, SPX, NDX, RUT.

Linda Piazza : 7/24/2008 11:02:54 AM

The TED spread has now dropped to 1.15. The 6/27 close was 1.132, so I missed that potential support when I was listing potential support levels earlier.

Linda Piazza : 7/24/2008 10:59:11 AM

So far, the OEX is finding resistance where you'd expect it to find resistance on 15-minute closes, up to 589.43 now, but bears should not forget that potential support on daily closes at the 30-sma, at about 587.30. The intraday charts show the possibility for the OEX to drop to 583-585, but I'd temper my expectations a bit if in bearish trades since those potential downside targets would both be erased if the OEX were to climb above and stay above (with staying above it the important part) about 590.35.

Jane Fox : 7/24/2008 10:55:02 AM

Crude has had some really big swings today and has been a daytraders dream. I quit after 2 wins this morning but wish I had kept on.

Keene Little : 7/24/2008 10:54:45 AM

The bounce off the low looks corrective. While it could still bounce a little higher I think we've got lower lows ahead of us. Just keep an eye on SPX 1269 for potential support at its uptrend line.

Jane Fox : 7/24/2008 10:54:23 AM

CRude is selling off again today. Currently at $123.80

Linda Piazza : 7/24/2008 10:48:43 AM

The TED spread has dropped to 1.17, its low of the day today. I believe there may be potential support near 0.98-1.00 and then, stronger, at about 0.90-0.92. These are guestimates because the Bloomberg chart I must use doesn't allow me to draw trendlines or employ the other studies I'm accustomed to using.

Linda Piazza : 7/24/2008 10:46:48 AM

The TRIN is testing potential Keltner resistance on 15-minute closes that's now at 1.47. The TRIN doesn't often stay above this level for long, and, even as I typed, dropped back from its 1.57 high. Therefore, there's the possibility that the TRIN could turn lower now, as it did on 7/16, 7/17 and 7/18 after testing this same Keltner line in the morning. Equity bears should be wary now and protective of their profits, just in case. They would prefer that the TRIN move sideways most of the rest of the day rather than drop sharply. Bulls would prefer to see that sharp drop, of course. TRIN at 1.46 as I type.

Jeff Bailey : 7/24/2008 10:39:50 AM

US Nat. Gas Fund (UNG) $43.77 -4.20% ...

Jeff Bailey : 7/24/2008 10:38:50 AM

EIA: Nat. Gas Inventory Table Link ... build of 84 Bcf

Jeff Bailey : 7/24/2008 10:37:51 AM

Swing trade call exit alert! ... the F5 Networks FFIV Aug $30 Put (FLK-TF) at the bid of $0.90.

FFIV $32.32 +4.12% ...

Jeff Bailey : 7/24/2008 10:32:54 AM

Dow Chemical (DOW) $33.93 -0.90% ... Earnings Press Release Link

Jeff Bailey : 7/24/2008 10:31:30 AM

3M (MMM) $71.83 +1.45% ... Earnings Press Release Link

Jeff Bailey : 7/24/2008 10:29:50 AM

Ford Motor (F) $5.62 -6.79% ... Earnings Press Release Link

Jeff Bailey : 7/24/2008 10:28:25 AM

Qualcomm (QCOM) $53.21 +18.67% ... NDX/QQQQ heavyweight sharply higher after company boosted view. Now sees current quarter EPS of $0.49-$0.51 (ex-items) on revenue of $2.5-$2.7 billion. Forecast includes settlement with Nokia.

Linda Piazza : 7/24/2008 10:28:11 AM

The A/D line is currently -837, but with a potential downside target of about -1100. I would watch for support to kick in if it should approach that -1100 level, particularly if it should do so while the OEX was testing 583-585 potential support.

Jeff Bailey : 7/24/2008 10:25:45 AM

Jobless Claims ... Initial claims for jobless benefits rise 34,000 to 406,000 in the week ended July 19, matching the highest level since September 2005. Economists expected a 14,000 rise.

Linda Piazza : 7/24/2008 10:20:40 AM

The OEX now has potential resistance on 15-minute closes near 589 and then again at about 590.25.

Linda Piazza : 7/24/2008 10:19:34 AM

The TRAN has moved down to potentially strong support on 15-minute closes, at 5028.50-5039.60. After hitting a low of 5035.25, it has bounced and is now 5068.76. OEX, SPX and Dow bears want to see it find resistance on 15-minute closes at about 5099.50-5100 and roll over again. Bulls want to see a strong surge and then sustained prices above that level.

Keene Little : 7/24/2008 10:22:02 AM

The DOW has clearly broken its uptrend line (11615) from the July 15th low and SPX has dropped below the level where the pullback from yesterday's high had two equal legs down (1273.36). So the breakdown this morning looks a little more bearish than just a quick pullback before resuming its rally. The uptrend line for SPX, at 1269, is now only 2 points below this morning's low so far.

Jane Fox : 7/24/2008 10:17:02 AM

I really like it when the internals are in sync. AD volume making new daily lows. AD ratio (top chart) agreeing with new daily lows and the VIX agrees as well with new daily highs. Trin is also on board at 1.30. Link

Jeff Bailey : 7/24/2008 10:16:47 AM

A real mix this morning.

Jeff Bailey : 7/24/2008 10:16:35 AM

Most Actives ... QCOM $54.54 +19.43%, C $20.14 -4.59%, SPY $127.21 -0.74%, QQQQ $45.10 -0.59%, MSFT $25.67 -2.95%, WM $4.10 -11.82%, AMZN $79.49 +12.73%, LVLT $3.41 -4.21%, F $5.53 -8.29%, XLF $21.98 -2.09%

Linda Piazza : 7/24/2008 10:16:55 AM

The OEX is currently testing the 30-sma, actually a bit below it. Bears should remember that, if the OEX is just setting up a 2-5 day period of consolidation, one of the possibilities, that this 30-sma could end up being support on a daily close. Both the 15-minute and 30-minute intraday charts suggest that, barring a strong bounce in the next few minutes, the OEX is setting a potentially lower downside target, perhaps to 585 or even 583, but the bounce potential of this daily 30-sma shouldn't be ignored. Protect profits, perhaps by some method that preserves the possibility to participate in lower moves if they occur, perhaps by selling part of the position to lock in profit and moving stops down on the rest? Just remember that the 10-sma test resulted in a strong gain just a couple of days ago.

Jeff Bailey : 7/24/2008 10:13:41 AM

10:00 Internals found at this Link

Jane Fox : 7/24/2008 10:09:19 AM

All markets have now broken their ON lows. Opps no NQ is still testing the lows of the spike down bar right at the ON's open.

Jane Fox : 7/24/2008 10:04:11 AM

WASHINGTON (MarketWatch) - Resales of U.S. single-family homes and condos fell 2.6% in June to a seasonally adjusted annual rate of 4.86 million, the lowest level in 10 years, the National Association of Realtors reported Thursday. Resales have sunk 15.5% in the past year and are down about 33% from the peak in 2005. The pace of sales has been relatively stable since last August at around a 5 million annual pace. Economists surveyed by MarketWatch expected sales to fall to 4.95 million. The inventory of unsold homes on the market rose 0.2% to 4.49 million, an 11.1-month supply at the current sales pace, the second-highest inventory level since the mid-1980s. The median sales price fell 6.l% in the past year to $215,100.

Jane Fox : 7/24/2008 10:03:37 AM

Existing-home sales fall 2.6% to 10-year low

June existing-home sales fall 2.6% to 4.86 million pace

June existing-home inventory 11.1-month supply

June existing-home price down 6.1% in past year

Keene Little : 7/24/2008 9:58:16 AM

Speaking of the banks, BIX left a bearish shooting star at resistance yesterday. A red candle today would confirm the reversal signal. Daily chart: Link

Jane Fox : 7/24/2008 9:56:29 AM

Here are your overnight charts. The DOW and Russell 2000 have both broken their overnight lows and ES (S&P futures) is testing its ON low. Link

Linda Piazza : 7/24/2008 9:56:03 AM

The OEX has potential support on 15-minute closes at about 588.94, but you should probably also factor in vulnerability to a daily 30-sma test either today or tomorrow. That 30-sma is currently 587.31. Bears should make profit-protecting plans for an approach to that level, as the OEX sprang fairly quickly off its 10-sma when it retested it. Since we have a potential reversal signal (backed up by stronger ones on the BIX and BKX), the possibility of a reversal on the daily chart exists, but so far, we don't know whether that's what will happen or if this current weakness is just part of a several-day pattern of consolidation after a strong gain.

Jane Fox : 7/24/2008 9:54:01 AM

AD volume is making new daily lows but at -441 that doesn't make a lot of difference because the VIX is not making new daily highs. I see the TRIN breaking up to 1.30. And the VIX is now making new daily highs so all internals are in sync now.

Keene Little : 7/24/2008 9:51:56 AM

The DOW is weaker than SPX as YM breaks this morning's pre-market low before ES.

Keene Little : 7/24/2008 9:50:40 AM

Running the futures up from the low near 7:30 AM into the open was another classic example of the futures being manipulated higher in order to have the cash market open as high as possible in order to sell into it. Always look at those morning ramp jobs with suspicion. Now let's see if those pre-market lows get tested. If it ramps right back up instead then we'll know the quick spike down was an attempt to pull in the shorts to help provide some more lift to the market.

Even though I show upside potential you should stay aware that momentum is fading (bearish divergences are showing up on the chart). Therefore if you're trading the long side with short term trades keep one foot holding the exit door open (trail your stops up closer).

Linda Piazza : 7/24/2008 9:50:16 AM

Remember that we get existing home sales at 10:00, so plan your trades accordingly. In addition, voting FOMC member Timothy Geithner will appear along with SEC Chairman Christopher Cox before the House Financial Services Committee, with the two testifying about financial market regulation. That's at 10:00 am ET, too, and both events could prove market moving. Decide before 10:00 if you want to keep all trades open or if you want to open new ones with the potential for market-moving events.

Linda Piazza : 7/24/2008 9:44:57 AM

Late Tuesday and yesterday, the BIX began setting up a triangle formation on the 30-minute chart. This morning, the BIX has broken below the triangle's rising supporting trendline, but it hasn't quite confirmed by breaking below yesterday's 189.70 low, although it's testing it as I type.

Linda Piazza : 7/24/2008 9:40:48 AM

The A/D line gapped below potentially strong support on its 15-minute chart, so we have to consider a couple of possibilities. One is that it will bounce back to that support by the end of the 15-minute period and preserve it, with that support now at about 135. However, with the A/D line diving quickly, the possibility of a strong drop, perhaps even to next support at about -1000, must be considered. The A/D line could stop short somewhere before that and set up some kind of early range, as it sometimes does, and then chop around inside that for a while before deciding on next direction. For now, however, any bounce back toward 135 must be watched for rollover potential. A/D line at -420 as I type.

Linda Piazza : 7/24/2008 9:35:59 AM

The OEX is, as expected, dipping to test potential support on 30-minute closes, first at 592.29, with lower potential support on 30-minute closes at 591.13. Bulls need to be cautious if that support does not hold, particularly on 30-minute closes, as the OEX then risks a drop toward 588-589 and perhaps even the 30-sma now at 587.39.

Jane Fox : 7/24/2008 9:34:28 AM

I showed this chart yesterday and what I said agrees with Keene's 9:10 observation that we could get a pullback this morning however, I think the pullback will encompass today and probably into next week. Where that pullback ends will tell you a lot about where the markets will go for the next few months. Link

Linda Piazza : 7/24/2008 9:17:05 AM

Yesterday, I'd gone into the day thinking that the OEX could begin its 2-5 days of consolidation that's part of a typical pattern for the OEX after a retest of its 10-sma and subsequent strong rebound. We did see a consolidation-type candle with a small body relative to the previous day and with upper and lower shadows. However, I expected any small-bodied candle to be produced at or under the 30-sma, not above it, as it was. We should now anticipate the possibility that if the consolidation does continue, the OEX might find support on daily closes at that 30-sma, now at 587.96. If it doesn't do so, and especially if it should pull back today and close beneath the 50% retracement of Tuesday's candle, at 581.60, then something more than consolidation is occurring. One consideration is that a commentator on Bloomberg TV said yesterday that the financials' 32% rebound in six days had brought them into the second largest sector of the SPX, up from the previous week's fourth-largest standing. Then, yesterday, both the BIX and BKX produced daily candles that are sometimes seen at reversals. They should definitely be watched because if they turn lower and reverse, they could bring both the SPX and OEX lower, too. In addition, the TRAN produced a doji at the top of its climb, suggesting that the transports may need to ease pause or retreat to retest support.

As I type, futures are lower but moving up from their few-minutes-ago levels. If the cash markets behave in accordance with futures' current distance from fair values, we can probably expect the OEX to retreat to test potential support on 30-minute closes at the 9-ema, now at 592.29, or lower support, at 591.11. Until and unless the OEX sustains 30-minute closes beneath that lower potential support, chances remain somewhat strong that it could bounce back up to retest its upside target and potential resistance at that chart, now at 595.96. I would watch for potentially strong resistance to start kicking in lower, however, at about 594.60 on 15-minute closes.

To sum up, there's potential for today to continue a consolidation pattern that may have begun to be set up yesterday, with some overlying concern about what might happen to financials and transports and the possibility that, if their potential reversal signals there are fulfilled, they could drag down the OEX and SPX. If it's just going to be a choppy consolidation day, there's the potential for an early drop to 591 or so or an early climb to 594.60-596 and potential for the OEX to get stopped there until it can loosen either support or resistance. A strong plunge through that support might change the tenor, so we'll watch for that, if it should occur.

Keene Little : 7/24/2008 9:12:24 AM

Looking at the pullback from yesterday's high, two equal legs down for SPX would be at 1273.36. If ES tests its overnight low of 1275.50 we could see SPX tag that downside projection and set up another rally leg from there.

Keene Little : 7/24/2008 9:10:15 AM

It looks like we could get a pullback started this morning. Equity futures are down slightly but off their lows. It does however leave us overnight lows that could get tested. A decline this morning would have the DOW breaking its uptrend line from the July 15th low but as mentioned last night SPX can tolerate a little lower before challenging its uptrend line as shown on this 30-min chart: Link

Its uptrend line is near 1269 or about 12 points below yesterday's close. At its low ES was down 7 points. If the uptrend line is tested and holds (or rallies to a new high without being tested) I see the potential to push higher to a Fib projection near 1315 by the end of the week. Otherwise a break below 1269, confirmed with a break below 1263, would suggest at least a move back down to the 1240 area.

Linda Piazza : 7/24/2008 8:57:57 AM

On my delayed quote, the TED spread is 1.23, down 0.025 or 2.024%.

Jane Fox : 7/24/2008 8:55:20 AM

Here are your overnight charts. If it were not for NQ's (the NDX futures) big spike down right after the futures opened at 4:30ET yesterday all markets would have made a series of lower lows and highs, which is bearish. I wouldn't be reading too much into these right now but the bears certainly had the ball overnight. Link

Jane Fox : 7/24/2008 8:47:57 AM

WASHINGTON (MarketWatch) - First-time claims for state unemployment benefits rose to their highest level since late March in the latest week, the Labor Department reported Thursday. The number of initial claims in the week ending July 19 rose 34,000 to 406,000. It's the highest level since the week ended March 29. The consensus forecast of Wall Street economists was for claims to rise to 380,000. Claims in the previous week were revised to an increase of 24,000 to 372,000 compared with the initial estimate of a rise of 16,000 to 366,000. The four-week average of initial claims rose 4,500 to 382,500. A Labor Department official said that claims have been very volatile this month given the annual auto plant shutdowns, the Fourth of July holiday, and the end of the second quarter. Economists expect the volatility to subside in coming weeks. Meanwhile, the number of Americans receiving state jobless benefits held fell 9,000 to 3.11 million in the week ending July 12. The four-week moving average of continuing claims fell 7,000 to 3.13 million.

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