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Jeff Bailey : 8/8/2008 2:20:28 AM

World Bullish % Bell Curve Link

07/31/08 Link

07/21/08 Link

05/19/08 Link

Jeff Bailey : 8/8/2008 2:04:31 AM

Bullish % All (BPALL) Link

Jeff Bailey : 8/8/2008 1:23:14 AM

ECB's Jean-Claude Trichet ... Statement Link

Jeff Bailey : 8/8/2008 1:16:50 AM

Global Currencies screen capture Link

Euro -0.56%, Yen -0.16%, Pound -0.74% are three biggest weights in DXY.

Aussie -1.16% and New Zealand -1.59% notably weak.

Jeff Bailey : 8/8/2008 1:08:29 AM

U.S. Dollar Index (DXY) daily intervals with Monthly/Quarterly Pivot retracement. Chart from earlier this year Link

Screen capture 12:32:48 AM EDT.

Jeff Bailey : 8/8/2008 12:56:16 AM

BIG move in the US Dollar Index (DXY) 74.957 here tonight.

Jeff Bailey : 8/8/2008 12:45:56 AM

Closing Internals at this Link

Keene Little : 8/7/2008 10:43:10 PM

Friday's pivot table: Link

There are two EW patterns that I consider higher-probability scenarios if the market is to work its way higher into either next week (opex week) or maybe even into the end of the month, both shown in pink on the SPX and DOW 180-min charts: Link and Link

The SPX chart shows the possibility for additional sideways consolidation through next week before rallying into the end of the month (up to as high as 1250, DOW 12K) while the DOW's chart shows a rising wedge since the July 28th low which would have the rally finishing next week (11800, SPX 1320-1325). Additional price action is needed to help determine which could be playing out.

But both short-term bullish possibilities would be negated with a drop below the July 28th lows (SPX 1234, DOW 11127) in which case the market will have started the next large decline. As for today's price action it remains a possibility that the down day was the head-fake move as we head into opex and if so then one of the short-term bullish (pink) scenarios could play out.

OI Technical Staff : 8/7/2008 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The Market Monitor has been archived.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 : 8/7/2008 5:00:08 PM

June'08 Consumer Credit ... Source: Federal Reserve Link

Jeff Bailey : 8/7/2008 4:47:44 PM

Excellent, excellent discussion taking place on CNBC regarding U.S. "small cap" and "large cap" as well as dollar.

Jeff Bailey : 8/7/2008 4:37:09 PM

Bullish swing trade long setup alert! ... for 1/8 position in the ProShares Ultra S&P 500 (SSO) $60.09 -2.86% ... to go long should the SSO trade $58.60 on Friday (tomorrow).

STOP would be $56.50.

Jeff Bailey : 8/7/2008 4:22:25 PM

Crocs, Inc. (CROX) $4.34 +0.93% ... Earnings Press Release Link

Please remember CROX warned on shortfall 07/24/08.

$4.08 extended.

Keene Little : 8/7/2008 4:16:04 PM

SPX 1265 held (two equal legs down from yesterday's high) and that leaves the door open for the bulls to be let into the pasture again. A rally above today's mid-day high would be bullish. A little lower, bounce off the uptrend line near 1258 and then drop below it would be a bearish price pattern. Hopefully we'll get the clue we need tomorrow as to what's next (at least for what the probabilities will be into opex week).

Jeff Bailey : 8/7/2008 4:16:24 PM

If there is ONE MAJOR NEGATIVE, or BEARISH thing I see regarding CURRENCY and EQUITY relationships, it would be the WEAKER YEN and the lackluster Nikkei-225, or its iShares Japan (EWJ) $11.50 -1.87%. Link

I would note that while the EWJ closes at a new 52-week low, and juuust below its 03/14/08 low, the Nikkei-225 ($NIKK) Link still "well off" its March lows.

Yen CurrencyShares (FXY) Link

Jeff Bailey : 8/7/2008 4:05:20 PM

Wachovia Corp. (WB) $17.12 -7.00% ... those currently long the WB-UD (Sep $20 Put), place a WB-TC (Aug $15 Put) on your watch list for tomorrow as a SELL COVERED put. If we can get $1, or more, might be worth it into next week's expiration.

Jeff Bailey : 8/7/2008 4:01:22 PM

Really didn't think VLO much below $32.90. Tried to compensate toward the close, but didn't work.

I certainly don't want to teach a continued practice of "adjust a stop" lower and lower for bull trades, or higher and higher for bearish trades.

Jeff Bailey : 8/7/2008 3:58:23 PM

Just a note: Today's finishing Sept. unleaded/oil crack spread of 25.018 (my calculation) is best since 6/27/08.

The negative tape to the close certainly doesn't help VLO.

I can say with some certainty, that there are not a lot of "retail" traders that monitor crack spread and associate with refiners.

In fact, I was talking to a guy the other day that was telling me that the gas station companies were making a bundle on gasoline prices and it was just terrible.

I told him to take a look at VLO and TSO and others stock prices over the last several months and their earnings and he'd see differently.

Right now, and until the VLO's and TSO's of the world get some NOTABLE price action and show up in the paper, probably the only traders/investors picking away are going to be doing so based on the crack spread.

VLO-IT stop probably way too tight going into this afternoon's close.

Will keep on the list as oil could really come under some pressure if euro continues to slide.

Linda Piazza : 8/7/2008 3:51:03 PM

Here's where the OEX is now with respect to the daily 10-sma and the rising trendline off the 7/15 low: Link Bears have a difficult decision this afternoon as this potentially strong support is approached at the end of the day. The 15-minute chart suggests the possibility of a 30-sma test (the black moving average on the chart, but we can't assume that trendline support that's held for almost a month is going to fail this time. It might. This is a rising wedge and theory suggests that it's likely going to break to the downside, but there can be a world of hurt to your account size if you believe that theory always is proven out to be true. Examine how much risk you have on the table tonight and decide how much of that risk you want to take home with you. Those with profits should include the risk of losing those profits as you make your decisions. With this market environment, if I'd just intended a day or swing trade, I think I'd be locking in at least part of my profits.

Keene Little : 8/7/2008 3:46:38 PM

Depending on how the uptrend line from July 15th is drawn (through either the July 28th low or August 4th low), SPX will break its uptrend line at either 1261 or 1258. Those provide the line of defense the bulls must hold.

Jeff Bailey : 8/7/2008 3:44:06 PM

PBR $52.36 +1.10% ...

Jeff Bailey : 8/7/2008 3:43:15 PM

NYSE a/d 669:2385 ...

Jeff Bailey : 8/7/2008 3:42:30 PM

Swing trade call stopped alert! for the VLO-IT at the bid of $2.70. VLO $32.80 -4.84% ...

Keene Little : 8/7/2008 3:39:55 PM

Two equal legs down for SPX from yesterday's high is at 1265 which just got tagged. If we're to get just a correction of the rally that's been in progress then it will likely find support here and turn back up. If it breaks below 1260 it will begin to look more bearish.

Jeff Bailey : 8/7/2008 3:39:04 PM

VIX.X 21.38 +5.68% ...

Jeff Bailey : 8/7/2008 3:38:49 PM

VLO $32.85 -4.69% ... VLO-IT $2.72 x $2.77

Jeff Bailey : 8/7/2008 3:37:31 PM

Sep futures crack ended 25.018, up a smidge from yesterday's 24.876.

Oct crack ended 24.217, up fractions from 24.112.

Linda Piazza : 8/7/2008 3:36:42 PM

The RUT is closely approaching a 50% retracement from Monday's low to yesterday's high, with that 50% level at about 713.87 and the RUT at 714.09 as I type.

Jeff Bailey : 8/7/2008 3:32:24 PM

I should probably mention again ... U.S. natural gas consumption is largely U.S. produced, or Canada and Mexico.

Not as "sensitive" or correlative to US$.

Linda Piazza : 8/7/2008 3:25:10 PM

The OEX's 15-minute chart shows that the OEX has potentially strong resistance on 15-minute closes now up to about 590. There's vulnerability down to 586.91 now and perhaps to the daily 10-sma, now at 585.10, and maybe even lower, toward 584.34, but that's not a given.

Those who are itching to jump in with bullish trades should be aware that if the OEX can't jump above about 590.50 now and sustain values above that, the 15-minute chart is showing vulnerability to much lower values than those I've listed above. However, with the OEX hovering near the important midpoint of Tuesday's range and just above potential Keltner support on the 30-minute chart, I'm not considering that much lower downside target set yet. I would just keep in mind the possibility it's suggesting: a daily 30-sma test.

Bears should keep in mind that the OEX is indeed hovering very near the 589.02 level that it needs to stay below into the close to confirm any bearish reversal signal, and that, just below that, rising trendline support off the 7/15 low and the 10-sma converge, and they could provide support. Take it one step lower at a time, change your stops with each step lower and decide soon if you want to hold overnight.

Jeff Bailey : 8/7/2008 3:23:53 PM

UNG $39.98 -2.65% ...

Jeff Bailey : 8/7/2008 3:23:28 PM

Nat gas getting hit some more.

Jeff Bailey : 8/7/2008 3:22:42 PM

The futures "crack spread" on 5-day and 20-dayNet% combined with euro trade enough I think to warrant giving VLO a little more room.

Jeff Bailey : 8/7/2008 3:20:20 PM

USO $95.62 +1.15%

UGA $54.96 +0.58% ...

Jeff Bailey : 8/7/2008 3:19:44 PM

Swing trade call option adjust stop alert! ... for the one (1) VLO-IT to $32.80 in the underlying shares of VLO $33.10 -3.97% ...

Linda Piazza : 8/7/2008 3:19:20 PM

Companies reporting earnings before the bell tomorrow morning include BZH, LPNT, MBI, NAT, TRGL, WR, RBS, DRS, CRN, CDE and CNK, among others.

Jeff Bailey : 8/7/2008 3:16:14 PM

Could be "pivotal" close for the PMJ-TI with PBR $52.91 +2.16% ...

Linda Piazza : 8/7/2008 3:16:06 PM

Companies releasing earnings tonight after the close include ACS, ELX, EPAY, IMGN, and a host of other companies big and small.

Jane Fox : 8/7/2008 3:13:08 PM

The S&P futures are making new daily lows but the VIX is not making new daily highs telling there are buyers lurking. Link

Linda Piazza : 8/7/2008 3:11:54 PM

What happens overnight on the scheduled economic developments scene? Japan's Economy Watcher's Current Index will be released at 1:00. Some numbers from France and Italy will be released at 2:45 and 4:00 am ET, respectively, with Italy's being that country's preliminary GDP. I don't know that those numbers will move our markets which may be on hold for our productivity and costs numbers at 8:30 am ET. Canada will release employment numbers at 7:00 am ET.

Jane Fox : 8/7/2008 3:10:58 PM

Here are your overnight charts. As you can see the only market that has not broken their ON lows is NDX futures (NQ). Link

Linda Piazza : 8/7/2008 3:08:38 PM

TED spread 1.14.

Jeff Bailey : 8/7/2008 3:07:35 PM

VIX.X 20.92 +3.41% ... probes WKLY S1 from underneath.

Jeff Bailey : 8/7/2008 3:06:58 PM

SPX 1,271

Jeff Bailey : 8/7/2008 3:06:47 PM

SPY $127.23

Jeff Bailey : 8/7/2008 3:06:00 PM

Swing trade long stopped alert! in the ProShares Ultra S&P500 (SSO) $60.40

Jeff Bailey : 8/7/2008 3:04:45 PM

FXE 143.41 -0.56%
FXY $91.14 +0.34%
FXB $194.53 -0.18%

Keene Little : 8/7/2008 3:04:28 PM

The move down from this afternoon's high is now a 5-wave move. It could be the completion of an a-b-c sideways correction that played out today and if so then we'll start another rally leg this afternoon. Whether it will be able to break above 1291 remains the question.

But if it's the start of the next leg down in a larger decline then we'll only get a bounce this afternoon followed by a move lower again (breaking to a new low would confirm the more bearish meaning of this afternoon's drop). So a little more price action should tell us what to expect heading into tomorrow.

Jeff Bailey : 8/7/2008 3:03:48 PM

US June Consumer Credit increased $14.3B

Jeff Bailey : 8/7/2008 3:03:22 PM

May Consumer Credit revision released.

Linda Piazza : 8/7/2008 3:02:49 PM

New low of the day for the OEX, but it's still just testing potential support on 15-minute closes near 589.60. OEX at 589.24 as I type, with potential candlestick support at 589.02. Bears want to see 589 lost, setting a potential downside target first at 586.88. Watch for possible support to kick in anywhere between there and 584.47.

Jeff Bailey : 8/7/2008 2:54:31 PM

WB $17.28 -6.13% ... WKLY Pivot right here.

Jeff Bailey : 8/7/2008 2:54:06 PM

BIX.X 185.25 -5.06% ... sets up for test of WKLY Pivot.

Linda Piazza : 8/7/2008 2:52:50 PM

The OEX's potential support on 15-minute closes extends down to 589.65, so bears would need to see sustained 15-minute closes beneath that to consider that the support has broken. On the 30-minute chart, it's at 590.86.

Where's next support if that is broken? Short-term charts suggest 584.23-586.90, with the daily 10-sma inside that range, at 585.25. The bottom of that range also closely coincides with the rising trendline off the 7/15 low.

So fat, though, the support is holding. OEX at 590.40 as I type. Anything at all can happen here, so know where your account-appropriate stops are.

Jeff Bailey : 8/7/2008 2:49:19 PM

NYSE a/d softening up at 880/2,143

Jeff Bailey : 8/7/2008 2:49:04 PM

SPY $127.60 -1.03% ...

SSO $60.67 -1.92% ...

Jeff Bailey : 8/7/2008 2:47:38 PM

SPY $127.82 -0.86% ... same type of trend would be at $126.00.

Monday's bullish entry for SSO was right at this trend and MONTHLY Pivot.

Jeff Bailey : 8/7/2008 2:44:52 PM

Somehow ... AIG $24.34 -16.32 has managed to hold a short-term trend from 07/15 to 07/29 pullback low.

Linda Piazza : 8/7/2008 2:31:56 PM

The OEX has been testing the 591 zone mentioned in my 2:01:46 post, but not dropping further toward the next support zone. As a review, the OEX would need to close at or beneath 589.02 today to confirm an evening-star reversal signal, so I'm sure there's some draw-the-line-in-the-sand type of action going on today. Barring that close, though, we've probably just got another indecision day on our hands, although one with a bearish slant if the OEX ends the day much below the opening level of 596.07. If the OEX should mount a strong bounce into the close, I'd be wary as it approached yesterday's high and then the top of that rising wedge shape, near 600. Currently, it doesn't look as if we have to put much thoughts into those tests, but in this market environment, with shorts thinking that they had the day, a surprise bounce that sticks could force some to cover.

Keene Little : 8/7/2008 2:28:48 PM

Pretty boring market today and unfortunately it's not helping to answer the question as to whether we should expect another leg down to match this morning's drop or if the sideways consolidation will lead to a continuation higher and a more convincing break of the downtrend line where SPX is currently trading (1278).

Jeff Bailey : 8/7/2008 2:13:43 PM

02:00 Internals at this Link

Linda Piazza : 8/7/2008 2:02:54 PM

If the OEX does drop toward 589.60-591, bears need to have an idea of how they'll treat a test of that zone as it could again serve as support.

Linda Piazza : 8/7/2008 2:01:46 PM

In my 1:15:50 post, I mentioned that it might be more likely that the OEX was going to just string candles along its 15-minute 9-ema than had appeared likely earlier. Since then, that's what it's been doing. That average is now about 593.10, and the OEX is trading just either side of it. The 30-minute chart shows a perhaps slightly increased chance of another test of a support line now at 590.90, but the 15-minute chart says that a climb to 594.50 and maybe even 598 is as likely as a drop to 591 or maybe even 589.60.

Jeff Bailey : 8/7/2008 1:55:51 PM

CNBC guest talking about dollar/oil.

DXY 75.437 ... is probing its QRTRLY 19.1%. If taken out to upside, the MR2 74.90 is next major level.

As noted (I think yesterday), that's correlative with the 11/26/07 close.

Jeff Bailey : 8/7/2008 1:50:41 PM

I should maybe note that there is a DXY and gold, silver, and other commodity relationships.

So many commodities base value in US$.

Jeff Bailey : 8/7/2008 1:45:26 PM

Now, futher review is needed it seems.

History seems to show that oil's PRICE isn't simply derived by "dollar" weakness/strength, but it sure appears to be a component.

I would think if there's one barrel left of oil in this world, and the DXY is at 85.00, that isn't necessarily going to equate to Oil=$25.00

Jeff Bailey : 8/7/2008 1:43:11 PM

So, if you live in Germany (or others under ECB), and you buy oil, and oil is priced in US$.

If you live in Japan, and you buy oil, and oil is priced in US$

If you live in the UK, and you buy oil, and oil is priced in US$.

Do you understand that?

Jane Fox : 8/7/2008 1:33:15 PM

Jeff I don't understand your question about the $ relationship with DXY. The DXY is the $ in relationship to a basket of currencies.

Jane Fox : 8/7/2008 1:28:42 PM

Here is a daily chart of Natural Gas. And we all thought Crude had sold off hard! Link

Jeff Bailey : 8/7/2008 1:27:42 PM

Any dollar relationship with DXY you can find?

Jane Fox : 8/7/2008 1:27:01 PM

NO Jeff I always adhere to my stops and my stop was Crude breaking below $128.00.

Jeff Bailey : 8/7/2008 1:24:41 PM

You still long those USO calls?

Jeff Bailey : 8/7/2008 1:24:04 PM

No Jane .... what's it doing?

Jane Fox : 8/7/2008 1:23:32 PM

Anyone taken a look at the 'ol greenback lately? Geesh!! No wonder Gold is selling off. Link

Jeff Bailey : 8/7/2008 1:23:37 PM

IWM, QQQQ, SPY and DIA daily interval montages I think traders and investors should be tracking still. Link

Linda Piazza : 8/7/2008 1:20:35 PM

The BIX certainly isn't doing a lot to prop up markets today. At 189.14, it's not far off its 187.74 low of the day, and it's having difficulty with the potential resistance just overhead. After its huge gain on Tuesday, the DRG is continuing its resistance test from the last few days, testing the 2/26/08 high of 317.28, with the DRG currently at 315.87. Barring a huge gain today, however, I don't see any way to make today's candle anything other than either a consolidation or indecision type or a bearish one.

Jeff Bailey : 8/7/2008 1:19:31 PM

Waiting on Endeavor

Jeff Bailey : 8/7/2008 1:18:55 PM

The Qs and IWM squared up within Oct'07 and Jan'08 conventional.

Linda Piazza : 8/7/2008 1:15:50 PM

The 594 level still appears to be giving the OEX some difficulties but the OEX actually finished the just-completed 30-minute period above potential resistance at its 30-minute 9-ema now at 593.21. The OEX is below that now, of course, but perhaps more likely just to string candles along it than it was earlier.

I'm watching the A/D line as it popped above next potential Keltner resistance, too. That's now at -1090 and it may be support now on pullbacks, suggesting an possible attempt to climb toward -540 if this support continues to hold. A/D line now -971. Of course a climb in the A/D line is likely to produce either a climb or a continued resistance test in the OEX.

Jeff Bailey : 8/7/2008 1:09:17 PM

Bid-to-cover was 2.40

59.02% at high

Jeff Bailey : 8/7/2008 1:07:18 PM

TYX.X down 10.4 bp at 4.586% ...

Jeff Bailey : 8/7/2008 1:06:55 PM

30-year auction results released.

Jeff Bailey : 8/7/2008 1:04:36 PM

SPX 1,281 -0.62% ... t minus 14

Jeff Bailey : 8/7/2008 1:02:54 PM

Citigroup returning billions to investors ... AP Story Link

Jeff Bailey : 8/7/2008 12:53:39 PM

FXE $153.37 -0.58% ...

Jeff Bailey : 8/7/2008 12:51:29 PM

USO Alert! 95.32 -0.10% ... slips red.

Jeff Bailey : 8/7/2008 12:50:30 PM

DIA's was $114

Jeff Bailey : 8/7/2008 12:49:06 PM

FXE $153.41 -0.56% ...

Jeff Bailey : 8/7/2008 12:48:49 PM

SPY $128.19 -0.57% ...

Jeff Bailey : 8/7/2008 12:48:30 PM

SPY's was $128.00

Jeff Bailey : 8/7/2008 12:48:03 PM

SMH's was $30

Jeff Bailey : 8/7/2008 12:47:25 PM

INTC ... at last night's close, Aug "max pain" theory tabulation was $22.00

Jeff Bailey : 8/7/2008 12:44:26 PM

AAPL $165.48 +0.78% ...

Jeff Bailey : 8/7/2008 12:44:04 PM

MSFT $27.53 +1.85% ...

Jeff Bailey : 8/7/2008 12:43:28 PM

FFIV $31.80 +2.51% ...

Jeff Bailey : 8/7/2008 12:42:54 PM

INTC $23.95 +5.04% ...

Jeff Bailey : 8/7/2008 12:41:14 PM

UGA $55.11 +0.86% ...

Jeff Bailey : 8/7/2008 12:40:53 PM

USO $96.00 +0.60% ...

Jeff Bailey : 8/7/2008 12:40:37 PM

FXE $153.47 -0.52% ...

Jeff Bailey : 8/7/2008 12:39:51 PM

QQQQ $46.68 +0.10% ... inches green.

Keene Little : 8/7/2008 12:39:26 PM

There's been no change since my last post over an hour ago--price appears to be consolidating below its downtrend line and looks bullish in that respect. It's trying to push back up as I type so a move back above 1282 would be potentially bullish. Then 1291 remains resistance until it's not.

Jane Fox : 8/7/2008 12:41:28 PM

CRude is back under $119.00. I watch Crude all day (because I trade Crude) and there have been a lack of buyers lately so when the sellers arrive they are able to push the market down. Link

Jane Fox : 8/7/2008 12:25:47 PM

WASHINGTON (MarketWatch) -- In a sign that the U.S. housing market may strengthen in coming months, an index of sales contracts on previously owned U.S. homes rose 5.3% in June from the prior month, the National Association of Realtors reported Thursday.

The index, which is considered to be a leading indicator of existing home sales, reached its highest level since October, but was still down 12.3% from June 2007.

Pending home sales increased in June in all four regions, with a gain of 9.3% in the South, 4.6% in the West, 3.4% in the Northeast and 1.3% in the Midwest. Despite the monthly gains, all four regions remain below year-ago levels.

The May pending home sales index was revised to a decline of 4.9% from the prior estimate of a 4.7% drop.

Some analysts have seen stability in recent pending home sales data, though it may still be too early to call a bottom to the market. A pickup in contract signings "appears to be broadening," NAR said, with on-year gains in mid-America markets such as Columbus, Ohio; Charleston, W.V.; Oklahoma City; and Colorado Springs, Colo. The group said pending sales have fallen "significantly" in Texas and Pacific Northwest markets.

Linda Piazza : 8/7/2008 12:24:54 PM

Jeff, I had mentioned this morning that the TED spread rose all day yesterday and then had popped up to 1.20 this morning, after the ECB's decision. (For newbies, the "T" comes from our treasuries and the "ED" from eurodollars.] It's dropped back to 1.13, still way too high and a test of a week's previous highs (before yesterday) of 1.1352 on 8/01/08.

Jeff Bailey : 8/7/2008 12:23:30 PM

PHM $12.25 -0.24% ...

Jeff Bailey : 8/7/2008 12:23:08 PM

CTX $14.57 -1.75% ..

Jeff Bailey : 8/7/2008 12:22:48 PM

RYL $20.38 -1.01% ...

Linda Piazza : 8/7/2008 12:22:34 PM

What can I say? I mentioned a while ago that the OEX's support looked strong enough that the OEX was either going to have to chop away at it for a while, long enough to soften it, or just plunge right through it. It's chopping slowly down, but the bulls appear reluctant to let it get back to that support level again. The small candles are clinging to the underside of the descending 15-minute 9-ema, now at just over 592, with further potential resistance on 15-minute closes at 592.68. There's still the potential for the OEX to break up through that resistance, to test 593.25 or even 595.50. That's not a given, but bears must include that vulnerability in their plans unless and until the OEX plunges below 589 and stays there.

Jeff Bailey : 8/7/2008 12:22:26 PM

TOL $20.10 +1.87% ...

Jeff Bailey : 8/7/2008 12:22:01 PM

DJUSHB 281.08 -0.5%

Jeff Bailey : 8/7/2008 12:20:54 PM

June pending home sales up unexpectedly ... AP Story Link

Jeff Bailey : 8/7/2008 12:20:06 PM

12:00 Internals found at this Link

Jeff Bailey : 8/7/2008 12:14:14 PM

Beetle's Balanced (from 06/30/08 rebalanced) Link

Jeff Bailey : 8/7/2008 12:10:03 PM

But that cash looks to be distributed out on the curve.

Jeff Bailey : 8/7/2008 12:08:56 PM

13-week has reversed course ... up 5 bp at 1.650%

Jeff Bailey : 8/7/2008 12:02:10 PM

Linda! Anything "unusual" in TED today?

Jeff Bailey : 8/7/2008 12:00:51 PM

Global Currencies benchmark at 11:54 AM EDT Link

Jeff Bailey : 8/7/2008 11:55:22 AM

YRCW $18.66 +1.19% ... WKLY R2 held support.

Jeff Bailey : 8/7/2008 11:54:25 AM

USO $96.56 +1.19% ...

Jeff Bailey : 8/7/2008 11:53:43 AM

Euro CurrencyShares (FXE) $153.55 -0.47% ...

Jeff Bailey : 8/7/2008 11:53:06 AM

DJ Reporting "euro dips under $1.5350, approaching key support levels."

Jeff Bailey : 8/7/2008 11:42:32 AM

SMH $29.42 +2.15% ...

Components and weightings Link

Linda Piazza : 8/7/2008 11:26:40 AM

Remember, bears, to figure out ahead of time how you'll treat another test of the potentially strong support on 15-minute closes that's now at 589-589.34, if the OEX should get that far again. The 30-minute chart shows potential support on 30-minute closes at 590.44. We've had our 594 test, and, although the OEX got a little higher (Keltner-wise) than bears would have preferred, that resistance did hold. However, it's possible now that we'll see the support hold, too, and it's currently looking so strong that the OEX will either require some time battering at it to soften it or else just a strong plunge straight through it. I said this morning that the 589-590 could be tough support, and it's so far still looking that way.

Keene Little : 8/7/2008 11:23:48 AM

SPX continues to find its downtrend line from May as resistance and I'm watching the form of its pullback to see if it may be consolidating for another break higher. So far it has that look and remains potentially bullish for another push higher this afternoon. However, the sharp drop this morning, followed by what appears to be corrective price action, has me leaning bearish for another leg down. Just stay aware of the bullish potential with a move back above 1282.

Linda Piazza : 8/7/2008 11:18:56 AM

A/D line is still rising from that support shown in the chart I posted earlier. It's now -1075, with the 15-minute 9-ema having cycled down to about -990 now, joining historical resistance near -1000. Bears want to see this hold as resistance on 15-minute closes.

Jeff Bailey : 8/7/2008 11:16:42 AM

SCI $10.40 +7.66% ... A 2nd-half and possible 1st-half '09 "top bull pick" for this year's Presidential Election Uncertainty.

Two things in life are certain. Death and taxes.

Jeff Bailey : 8/7/2008 11:13:58 AM

Service Corp. Intl. (SCI) $10.42 +7.66% ... world's largest death care service provider. Getting a pretty good pop.

Jeff Bailey : 8/7/2008 11:08:37 AM

Various Energy futures @ 10:30 AM EDT Link

Jane Fox : 8/7/2008 11:07:42 AM

Here is a chart of the DOW. Geesh, if you didn?t know better you would think this was a chart of the SPX. Link

Jeff Bailey : 8/7/2008 11:00:40 AM

RIO's CEO saying ... "Major acquisitions not probable."

Jeff Bailey : 8/7/2008 10:55:08 AM

Nestle's 1H profits up 6.1% ... AP Story Link

Worlds biggest food and drink company?

Jeff Bailey : 8/7/2008 10:50:38 AM

Haynes Intl. (HAYN) $54.17 +24.84% ... Earnings Press Release Link

Jeff Bailey : 8/7/2008 10:47:18 AM

UNG $41.93 +2.09% ...

Jeff Bailey : 8/7/2008 10:46:25 AM

EIA: Weekly Nat. Gas Storage Link ... Build of 56 Bcf

Linda Piazza : 8/7/2008 10:46:11 AM

The OEX's 15-minute 9-ema is now 593.97, with the OEX so far finding resistance at this level on 15-minute closes. So far, so good, for those in bearish trades, but this bounce got a little higher than was the preference, so bears should keep their profit-protecting plans updated. Bears would prefer a 15-minute close below 592.95. If that happens and the OEX heads down again, bears need to know how they'll treat a test of 588.88-589.30, as that could be strong support on 15-minute closes. This is also just above the 50% retracement of Tuesday's range. I'm not the only one who can make these calculations or who knows candlestick theory, either, so bulls know where they need to prop up the markets today.

Jeff Bailey : 8/7/2008 10:41:22 AM

Most Active ... QQQQ $46.49 -0.30%, SPY $128.29 -0.51%, AIG $24.06 -17.35%, INTC $23.38 +2.54%, CSCO $23.97 +0.16%, S $7.42 +0.95%, XLF $21.89 -1.88%, DYN $5.93 -6.46%, MSFT $27.27 +0.92%, VRSN $29.88 -11.80%

Linda Piazza : 8/7/2008 10:39:13 AM

My take on the ECB's strongly worded press release obviously isn't shared by the currency crowd. The euro is lower against the dollar this morning, so the currency crowd obviously takes this as a softening of the ECB's stance.

Linda Piazza : 8/7/2008 10:37:42 AM

The ECB still believes "the strong underlying pace of monetary expansion points to continued risks to price stability over the medium term." Although I haven't been able to make a word-for-word comparison to previous statements--these press releases are as long-winded as my posts--the ECB doesn't appear to be softening its stance on inflation although my general impression is that it is balancing that against increasing risks for lower growth. The ECB somewhat discounts that lower growth, however, believing that it will likely be tempered by emerging markets and that it's resulting partly just from a comparison to a previous period of exceptionally strong growth.

Jeff Bailey : 8/7/2008 10:35:09 AM

S&P Insurance (IUX.X) 259.71 -4.07% ...

AIG $24.03 -17.39% ...

Linda Piazza : 8/7/2008 10:33:05 AM

I'm still studying the ECB statement as I can. Concerning risks to price stability, the ECB says its focus is on the medium-term horizon. Energy and food prices and "indirect effects on consumer prices" have "increased those risks over the past few months." The ECB's Governing Council again warns against "schemes" that might produce "upward shocks in inflation," with one of those schemes being a move to index nominal wages to consumer prices.

Jane Fox : 8/7/2008 10:32:23 AM

Once again the internals are not in sync. The VIX is making new daily lows or at least hovering at hovering at daily lows while the AD volume is making new daily lows. These two should be mirror images of each other. The AD ratio is also telling me the bears do not have command of this market but neither do the bulls. Link

Jeff Bailey : 8/7/2008 10:30:33 AM

S&P 500 Heavyweights at this Link

Linda Piazza : 8/7/2008 10:29:15 AM

Factor into my 10:27:12 comments the fact that the A/D line hit potentially strong support this morning and has been bouncing ever since rather than merely going sideways the way bears would have preferred. We still don't know the ultimate outcome of this morning's action, but we do know that a couple of things just aren't unfolding the way bears would have preferred. A/D line at -1288 with potential historical and Keltner resistance now converging just overhead near -100 up to -800.

Linda Piazza : 8/7/2008 10:27:12 AM

Although the OEX's 30-minute chart suggests that the OEX will find the strongest resistance on 30-minute closes near 594.80, the OEX is actually climbing a little higher than bulls would prefer. They would have preferred that 15-minute closes be below about 593, which could still happen for this 15-minute period, of course, and that any punches above 593 be brief and soon reversed, which did not happen. Bears should be aware then that this bounce is a little stronger than they would prefer. The early dip's strength was in their favor, but once firmly below 594, bears would prefer that the lower end of resistance bands hold. OEX at 593.95.

Jeff Bailey : 8/7/2008 10:23:53 AM

F5 Networks (FFIV) $31.74 +2.32% ... doing the same.

Jeff Bailey : 8/7/2008 10:23:23 AM

Semiconductor HOLDRs (SMH) $29.22 +1.45% ... bucking early morning broader weakness.

Jeff Bailey : 8/7/2008 10:22:04 AM

10:00 Internals found at this Link

Keene Little : 8/7/2008 10:17:25 AM

After break back below its downtrend line from May, SPX has now bounced back up to it this morning, currently near 1280. Watching to see if it acts as resistance again.

Linda Piazza : 8/7/2008 10:10:43 AM

The TED spread rose all day yesterday, rising to a week high. This morning, it's still rising and is at 1.20.

Jeff Bailey : 8/7/2008 10:10:20 AM

VLO $34.43 -0.11% ...

TSO $17.45 +0.34% ...

WNR $7.63 +4.80% ...

Jane Fox : 8/7/2008 10:09:45 AM

CRude was not able to break above its support turned resistance and is selling off once again.

Jeff Bailey : 8/7/2008 10:09:37 AM

US Gasoline Fund (UGA) $55.81 +2.14% ...

Linda Piazza : 8/7/2008 10:09:01 AM

The OEX just closed a 30-minute period below the former potential support, now turned potential resistance on 30-minute closes, at 594.62. On the 15-minute chart, the potential resistance on 15-minute closes ranges from 593-594.40. So far, it's holding, too, but the OEX is still testing. One worry for bears is that when potential support is cut through so quickly, price action may be signaling that it's not going to be particularly strong as resistance, either. It's not as significant a place as it looked to be.

Keep a watch on the A/D line, as it's bouncing from that support I showed earlier.

Jane Fox : 8/7/2008 10:08:47 AM

And sure enough the VIX spiked to a new low and the S&P futures made a new high.

Jeff Bailey : 8/7/2008 10:08:02 AM

US Oil Fund (USO) $96.66 +1.29% ...

Jeff Bailey : 8/7/2008 10:07:32 AM

EuroCurrency Shares (FXE) $153.86 -0.27% ... (see last night's wrap)

Jane Fox : 8/7/2008 10:07:00 AM

THE VIX just spiked to a new daily low but the VIX chart this morning is not very clear so I would not be making any buying decisions based on it. However, I would not be selling based on the VIX.

Linda Piazza : 8/7/2008 10:00:45 AM

"Overall, downside risks prevail," the ECB says in the introductory remarks. In those statements, the ECB acknowledges the continued "possibility of disorderly developments owing to global imbalances" as well as "the potential for the financial market tensions to affect the real economy more adversely than currently anticipated." The ECB's statement mentions a flash HICP inflation estimate of 4.0% in June 2008 as particularly "worrying." The ECB doesn't believe inflation will moderate until 2009 and then only gradually.

Linda Piazza : 8/7/2008 9:56:21 AM

Keltner outlook on the A/D line: The A/D line dropped straight to potential support. All it has to do is move sideways here (although bears would prefer a breakdown) to maintain the bearish status, but bears should be aware of this potential support and should be on the lookout for bounce potential. So far, there's no real bounce here to corroborate the bounce attempt going on in the OEX, but we'll see, and there's no real resistance until about -1000 where some historical resistance is found. Here's the chart: Link

Keene Little : 8/7/2008 9:55:22 AM

After breaking its downtrend line from May, SPX has now dropped back down below it. That's bearish but it will be the close that counts. That downtrend line will be near 1277 by the end of the day so it will be the level to watch. Right now I'm watching to see if the decline, which is obvioulsy sharp, turns into a 5-wave move since it would be an indication of a short term trend change to the downside (that could be the start of a resumption of the longer term decline).

I've made mention many times in the past few months that the corrections to the bear market decline have been a series of 2nd wave corrections and 2nd waves are the ones which fool investors into thinking the decline is over and we'll see a resumption of the rally. It's why I keep saying surprises will be to the downside (in a series of 3rd waves to come). Whether we've started down now is too early to call since I still see the possibility for a move up to at least SPX 1325 by mid month before tipping over again.

Jane Fox : 8/7/2008 9:52:28 AM

TRIN is a neutral 1.05 so telling me very little. THe VIX is also not talking this morning.

Linda Piazza : 8/7/2008 9:52:20 AM

The OEX did find support on 15-minute closes above the potential support on 15-minute closes now from 588.66-589.19. I'm not sure the OEX is through testing that support, but if it continues the bounce it's begun, watch now for potential resistance on 15-minute closes from 592.91-594.79, with an emphasis on the higher end. Here's where we begin to see the tenor for the day, when we see how the OEX responds to this resistance.

Jane Fox : 8/7/2008 9:48:08 AM

AD line opens very bearish at -1635

Linda Piazza : 8/7/2008 9:47:30 AM

The ECB expects real GDP growth figures for mid-2008 to be "substantially weaker than for the first quarter of the year" but expects "resilient" growth in the world economy. The ECB believes "sustained growth in emerging economies" will continue and the eurozone itself suffers from no major imbalances. Still the higher energy and food prices will more than offset those benefits as well as unemployment rates that "remain low in historical terms."

Linda Piazza : 8/7/2008 9:42:17 AM

Credit spread and condor traders: if you have some open AUG bear call spreads, you might use this early dip this morning to see if you can get out of them for a pittance. In this market environment, you never know what might happen. It's a personal choice with pros and cons for each decision.

Linda Piazza : 8/7/2008 9:40:43 AM

The OEX is dipping a little further than I thought it would on the first dip. I thought it might go down to about 592 and then attempt to steady but it's still dropping. A test of 589-590 right away obviously can't be ruled out. In fact, it's occurring as I type. So, this is one place where bears should watch for potential support to kick in with both the 15-minute and 30-minute charts suggesting potential support here, down to 588.61 on 15-minute closes. In addition, the midpoint of Tuesday's range, an important level in candlestick theory on a tall candle day, is at 589.02. Now, we should watch for potential resistance from 593-594.50.

Jeff Bailey : 8/7/2008 9:37:18 AM

Swing trade long raise stop alert! ... for the 1/8 position in the ProShares Ultra S&P500 (SSO) $60.83 -1.66% ... to $60.40.

Linda Piazza : 8/7/2008 9:37:13 AM

Trichet and group "so far" see "no signs of significant constraints on bank loan supply."

Linda Piazza : 8/7/2008 9:36:31 AM

Trichet says, "The information that has become available since our previous meeting has further underpinned the reasoning behind our decision to increase interest rates in July." Oops. Most people hoped that the hawkish statements would ease a bit.

Linda Piazza : 8/7/2008 9:34:51 AM

If you would like to read them, here are ECB President Jean-Claude Trichet's introductory statements in his press conference: Link

Jeff Bailey : 8/7/2008 9:31:59 AM

Wal-Mart July Sales ... Press Release Link

Jeff Bailey : 8/7/2008 9:30:34 AM

Discount chain sales results for July Link

Jeff Bailey : 8/7/2008 9:28:44 AM

Toyota's net falls 28% on stronger yen, sales slump ... MarketWatch story Link

Linda Piazza : 8/7/2008 9:28:16 AM

My 9:23:33 post gave all the "watch for this, too" and "don't be complacent if you're bearish" kind of warnings. To put it more succinctly, we should get a negative open, with a strong possibility of a drop to 589-590 shown, but with some uncertainty about what would happen at that 589 test. Bulls might try to hold the fort near 592-594 first, so bears need to have profit-protecting plans in place for that test as well as for the test of 589-590. If bulls are strong enough, they could hold the fort and send the OEX back into a 598-601 test, with resistance there that might well hold again on a daily close, if tested.

I don't know that's any clearer, but hopefully it is!

Linda Piazza : 8/7/2008 9:23:33 AM

Keene mentioned late yesterday that some indices had produced a small-bodied candle at the top of a climb, after a tall green candle had been produced the previous day. He mentioned that this arrangement, if followed by a steep decline today, can complete a three-candle reversal signal known as an evening-star formation. The OEX was one of those indices producing such a setup.

A down opening is particularly bad news for the OEX bulls then, as it sets up the possibility of a particularly classic form of the evening star formation, a more perfect potential reversal signal. I have to add some cautions, however. The classic form requires a close today at or below the midpoint of Tuesday's range, so at or below 589.02. The second caveat is that during the strongest rally periods after 2003 and into the rally into October, sometimes the only reversal was the candle needed to complete the reversal signal!

With those caveats given and duly noted, then, we should realize that there's a potential reversal signal at or just below rising wedge resistance, with such formations considered to have bearish connotations. So, don't write off this possibility, but do keep the caveats in mind, at least enough so that you govern your risks.

Here's the rising wedge: Link If the OEX heads down today, obvious places to look for potential support are near the midpoint of Tuesday's range, so near 589.02 and then at the convergence of the lower trendline and the 10- and 30-sma's marked on that chart.

Yesterday, short-term Keltner charts were fair guides. Before the open, I provided the places where Keltner channels showed the strongest support, which did hold when the OEX came to within a few cents of it, and strongest resistance, which also held. If we get a cascading-lower type day, those levels won't hold. However, let's look at them anyway. The 30-minute chart shows the 9-ema at 596.35, but if markets behave in accordance with futures' action, the OEX will push through that right away. It's also likely to push through the next level of potential support near 594.15 currently, but bears need to realize that it could push through it and then bounce back above it before the first 30-minute close, showing that support did hold.

The 15-minute chart would extend that support down to 593.29 on 15-minute closes, so the OEX could dip close to 592-593 and bounce back above 594 before the close of the first 30-minute period.

However, the 15-minute chart shows that the OEX's climb was looking strained into the end of the day yesterday, with resistance firming and support being left far behind. That chart, at least, sets up the possibility that a 589-590 test could occur, a test of the midpoint of Tuesday's range, but bears need to be aware that if bulls are strong enough, they'll halt that decline near 592-594 and bounce the OEX again. Resistance on 15-minute closes appears strong near 598 and on 30-minute closes, near 600.50-601.00. This would be a further test of the top of the rising wedge shape.

So if the 592-594 support does take hold and bounce the OEX, I'd look for resistance to kick in again near there, and perhaps result in another indecision-type day.

Jeff Bailey : 8/7/2008 9:23:25 AM

U.S. Unemployment Weekly Claims Report Link

Jeff Bailey : 8/7/2008 9:22:00 AM

ECB's Statement Link

Jeff Bailey : 8/7/2008 9:17:55 AM

BOE's Statement Link

Jeff Bailey : 8/7/2008 9:14:56 AM

Global Economic Calendar at this Link

Linda Piazza : 8/7/2008 9:07:21 AM

As anticipated, the ECB has kept its minimum bid rate "on the main refinancing operations and the interest rates on the marging lending facility and the deposit facility . . . unchanged."

Remember that ECB President Jean-Claude Trichet's press conference comes about the time our markets open. This decision was expected, but the press conference might produce some upheaval, depending on what's said.

Jane Fox : 8/7/2008 9:01:24 AM

Crude is back to test the support turned resistance at ~ $120.00. Link

Jane Fox : 8/7/2008 8:59:48 AM

The weekly first time claims data out Thursday morning does not usually move the market but this morning it seemed to have done just that. Here are your overnight charts showing a nice selloff around 8:30ET Link

Keene Little : 8/7/2008 8:58:33 AM

Equity futures dropped yesterday after the close in reaction to AIG's earning's report and larger than expected loss. There was an attempt to rally the futures back up during the opening hours of the European markets but after a high near 5:00 AM (lower than Wednesday's highs) they have since sold off harder and made new lows at 8:30 AM. We've got a negative start for the day and we'll see if the bulls step back in to close the gap after the cash market opens.

Jane Fox : 8/7/2008 8:56:10 AM

WASHINGTON (MarketWatch) -- First-time claims for state unemployment benefits remained unusually high in the latest week as more workers qualified for regular benefits under an unrelated extended federal benefits program, the Labor Department reported Thursday.

Claims for the week ended Aug. 2 rose to 455,000, a gain of 7,000 from the prior week.

The figure was the highest in more than six years.

Many economists see claims above 400,000 as a sign of recession.

A Labor Department spokesman said claims are elevated due to more workers coming into the system who otherwise wouldn't without the benefits program having been recently extended under legislation signed into law by President Bush.

Claims will probably remain unusually high for several weeks, the spokesman said.

Linda Piazza : 8/7/2008 7:36:39 AM

The Bank of England has left its rates steady. The ECB's decision will be before our open, too, and that central bank expected to leave rates steady this time, too, after weakening numbers from Germany. To a great extent, Germany's economy has been the engine running the decisions in Europe, with other countries such as Spain long ago beginning to show signs of weakening economic numbers. Some have felt that the ECB has to some extent ignored the problems of the other countries and focused on Germany. If there is such a focus, the recent weakening numbers may soften the hawkish stance of the ECB a bit, although ECB members continue to note that the ECB's mandate is different than that of some other central bank's such as ours. ECB President Jean-Claude Trichet's press conference begins about the time our markets open, however, and that can be as important as the ECB decision.

Jeff Bailey : 8/7/2008 4:00:19 AM

Asian Markets ... Nikkie-225 down 129.90 points, or -0.98% at 13,124.99.

Hang-Seng trading today (Thursday) and up 149.07, or +0.68% at 22,098.82.

Shanghai up 8.21, or +0.30 at 2,727.58.

Jeff Bailey : 8/7/2008 3:57:24 AM

Japan's core machinery orders fall in June ... AP Story Link

See Wednesday's market wrap.

My first thought ... "weak, but not as weak as forecasted."

Let's see what the $NIKK is doing.

Jeff Bailey : 8/7/2008 3:11:52 AM

EIA: Gross Inputs, Crude Oil Inputs, Refinery Op. Capacity, Pct. Utilization of Op. Capacity, No. Days Supply, DXY and Eur/$ table that I track at this Link

Column C= This is the GROSS barrels per day of inputs into refineries.

Column E= This is ONLY crude oil barrels per day.

Column G and H= Number of barrels per day of OPERABLE capacity. Last week, 12,000 barrels per day of NEW capacity came to market. In Wednesday evening wrap, I noted this addition.

Column I and J= Of the OPERABLE capacity, this is how much is being utilized.

Column L= Based on last 4 weeks AVERAGE of Crude Oil Inputs (Column E) and the amount of Crud Oil Stockpiles (excluding SPR), their is about 19.5 days of supply (last week's crude oil supply rose by 1.61M barrels to 296.8M barrels.

Column M= Price of USO at each Friday's close.

Column O, P, Q = Also each Friday's close, and 1-month % change up/down for U.S. Dollar Index and 52-week change.

Column S and T= If euro strength/weakness vs. US$ is a factor, then tracking the Friday close and 1-month change. Not shown due to horizontal is also Yr Net% change, and 4-week SMA Euro/$ (last Friday's 4-week SMA was 157.46.)

At lower part of table I break out 1, 2, 3 and Year Ago changes in INPUTS. Most focus on CRUDE OIL INPUTS (columns E and F)

At very bottom are 4-week averages of Inputs. I forgot to update colors (green/up , red/down), but can see some changes in the average inputs/day.

Still at bottom and Column J= number of barrels per week (7 days in a week) of recent 4-week average of CRUDE OIL Inputs. "Over the last 4-weeks, refiners have been inputing about 106,365,000 barrels per week into their refineries.

You may have noticed my "bullishness" on airline stocks the last several weeks. Some of the ABOVE data was "reason" why I thought oil prices and fuel prices might be set to decline.

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