Option Investor
Printer friendly version
Jeff Bailey : 11/20/2008 9:56:25 PM

As I click through the U.S. Market Watch, Airline Index (XAL.X) has an upward trend (about $14.90), OIX.X had one and busted it like a hot knife through butter today. OIH had horizontal at $80.00, gapped it lower and got "drilled."

XNG.X and DRG.X haven't yet violated October lows.

Utility HOLDR (UTH) maybe a bit stronger, but -6.04% today. Bar chart looks a bit like the HUI.X

Jeff Bailey : 11/20/2008 9:47:49 PM

Nymex 11/20/08 Link

11/19/08 Link

Jeff Bailey : 11/20/2008 9:43:47 PM

Jan'09 Crude (cl09f) settled $49.42.

Jeff Bailey : 11/20/2008 9:28:54 PM

December Crude (cl08z) official termination $49.62.

Jeff Bailey : 11/20/2008 9:22:16 PM

Closing U.S. Market Watch at this Link

Doesn't appear that a great deal of money is flowing into (demand) gold, but it isn't flowing out (supply) as other issues. 20DyNet would be from 10/31/08 close.

Yen attracting the most still.

PHF still suggests something "wrong" in credit markets.

Noted bearish vertical counts in DIA and USO. No reason to buy, but reason to protect some bearish gains.

Jeff Bailey : 11/20/2008 8:08:55 PM

Hey! Its resulting 19.1% is 7,602.65. What's tonight's extendes session high so far? 7,603.

That's "in play"

Couldn't figure out WHY YM stopped there tonight.

Ask and you might just find out.

Jeff Bailey : 11/20/2008 8:07:00 PM

Hey! you conventional retracement day traders. Take a retracement from Wednesday high to low. Mid point is 7,820. Tie it in with the KEY level.

Jeff Bailey : 11/20/2008 7:53:36 PM

Ooooee! See overlap? See the "zone(s)"

Jeff Bailey : 11/20/2008 7:51:47 PM


See my "Range" S1-R1 and S2-R2? You're becoming "next level" status.

Jeff Bailey : 11/20/2008 7:50:27 PM

When you grab your DAILY pivot retracement from today and "slide it over" for tonight's extended session, or tomorrow's cash session, do this ...

Take the lower 0.00% and place it at 6,968 (note you're going lower). Once you've got it there, THEN adjust the upper 100% to DAILY R2. What are you doing? EXPANDING the range prior day's S2-R2 range, or COMPRESSING it?

Jeff Bailey : 11/20/2008 7:45:15 PM

YM Pivot Matrix for Friday Link

What's the KEY level? How did it trade today? (put up a bit of a fight) Sellers won out by the close. (see 04:30:14) Link

What the KEY level still? Gott'a get above the DAILY P to try and reclaim it.

Jeff Bailey : 11/20/2008 7:32:07 PM

So ... why does anyone REALLY care about an overnight trade?

Most believe ONLY to understand/observe if the KEY level was traded, and PRICE moved NOTABLY away from the KEY level.

It is a "what if?" WHAT if you went to bed and YM was 100-points AWAY from the KEY level. When you come to trade and its 800 points AWAY from the KEY level (with the KEY level having been traded overnight) and there was some type of NEWS LATER that then suggests that might have been "the news" deemed so important that SOMEBODY already new about and was DETERMINED to buy/sell and set their computers at.

Jeff Bailey : 11/20/2008 7:25:30 PM

ym08z and ym09h 2-minute extended ... both cursur boxes set at ym09h's last tick Link

Jeff Bailey : 11/20/2008 7:19:44 PM

You think the ym09h is thin trade during regular session, the overnight hardly exists at this point.

Jeff Bailey : 11/20/2008 7:15:28 PM

ym08z and ym09h 2-minute interval montage Link (per 06:44:21 and 07:00:56 )

Jeff Bailey : 11/20/2008 7:00:56 PM

YM settle Source: CBOT Link

See how the OPEN is "together?" That's a computer taking out any arbitrage from overnight.

Now see the HIGH (about 53 difference), then you'll note the LOW (29 difference) and that starts to get pretty notable at $5/point.

Then the settle has the computer "squeezing" together as much arb as it can, with settle determined by last minutes of trading.

Jeff Bailey : 11/20/2008 6:48:16 PM

YM and other futures traders that will calculate their own MONTHLY and QUARTERLY Pivots.

You should probably be noting the ym08z and the ym09h (or the futures you like to trade) right now.


When you want to get the regular session highs and lows for the QAURTERLY and MONTHLY, you're probably not going to see trade in the ym09h at the "high" and the "low" that will represent what is actually taking place in the ym08z.

So, with the settlements, you'll be able to "calibrate" the ym09h to match the cash session (dia).

On Monday ... ym08z settled 8,259. ym09f settled 8,221 (diff of 38)

Tuesday ... 8,494 and 8,448 (diff of 46).

Wednesday 8,027 and 7,983 (diff of 44)

and so on.

Jeff Bailey : 11/20/2008 6:35:32 PM

Oh ... unless you have a VERY large account, do NOT try and arbitrage out the premium.

That was "mentioned" many months ago for retail traders.

What wasn't "mentioned" was the possibility that the YM would surge higher, the rolling costs, and the MARGIN interest.

Jeff Bailey : 11/20/2008 6:30:22 PM

ym09h was 7,439 ... back in March/April is when they inverted. That'll be another sign of recovery.

Jeff Bailey : 11/20/2008 6:28:12 PM

YM's official settle was 7,487

Jeff Bailey : 11/20/2008 6:25:44 PM

Great "Max Pain" test for GLD going on isn't it? It is very close, but buyers juuuuust unable to push right now.

Or ... is it simply that it is "elevating" to the pain.

Monday .... monday.... monday.

Jeff Bailey : 11/20/2008 6:24:03 PM

Hey ... GoldCorp. (GG) $19.03 +2.20% ... and today was a "broad" market move.

Jeff Bailey : 11/20/2008 6:23:09 PM

Watch the miner stocks next broad market rally.

I'm not the ONLY one that sees the SLV and GLD. You know which stock I like to trade on the GOLD side.

Tought to find a pure silver name.

Jeff Bailey : 11/20/2008 6:19:36 PM

I really don't like showing my personal account stuff either. Best way to educate though is to show. Not just the good, but the bad too.

Jeff Bailey : 11/20/2008 6:18:04 PM

Boy ... when I've profiled trades and have responsibility, I sure follow things and dynamics more closely. I simply hate the "mention" stuff.

Jeff Bailey : 11/20/2008 6:14:40 PM

CI $8.88 -18.38%
HUM $25.47 -8.67%
UNH $16.30 -8.06%
WCG $7.01 -12.59%
HMO.X 690.23 -9.05% ...

Jeff Bailey : 11/20/2008 6:12:47 PM

VIX.X 80.86 at the close.

Jeff Bailey : 11/20/2008 6:12:20 PM

AVP $18.38 -11.97% today AVP-XX finish $4.50 x $4.90

AET $18.30 -13.84% ... AET-MX $5.20 x $5.70.

TSN $4.40 -12.69% ... would have been stopped at $4.50.

Jeff Bailey : 11/20/2008 6:07:52 PM

December Yen at this Link

Think about my profile of 1/8 DDM on Tuesday, and rather aggressive following of stop. Constant monitoring of the yen.

When the bullish traingle unleashed, that was "it" for the DDM.

Jeff Bailey : 11/20/2008 5:51:59 PM

Stock market tends to figure things out 6 to 9 months ahead though.

Jeff Bailey : 11/20/2008 5:51:31 PM

So, based on my past observation (yen strength/U.S. equity weakness), I'm really having to play the DIA and Yen counts against each other.

Jeff Bailey : 11/20/2008 5:50:06 PM

I should note that there's still quite a bit of room the the Yen's bullish vertical count.

1.16 for the December contract.

Jeff Bailey : 11/20/2008 5:46:56 PM

CNBC guest questioned any type of "bottom" to U.S. economic conditions.

Cited money print and bailouts just keep coming.

I thought he made valid point in that "this could be worse if the dollar had weakened further, and when it does, watch out."

Now, many GOLD bulls have been scratching their heads as to why GOLD hasn't performed very bullish of late.

Again noting GLD and FXY as only things I see with gain on 20DyNet%.

Jeff Bailey : 11/20/2008 5:33:13 PM

I should note ... GLD showing +2.94% last 20-dayNet% on my QCharts.

Jeff Bailey : 11/20/2008 5:24:54 PM

Dow Diamonds (DIA) That was then, this is now. PnF chart and my "bottom call" in 2003. Link

Jeff Bailey : 11/20/2008 5:00:20 PM

Only long-time OI subscriber might know the importance of this observation.

Jeff Bailey : 11/20/2008 4:58:43 PM

Good grrravy! DIA $76.91 -4.29% ... its BEARISH vertical count (generated with trade at $89) and resulting column of O to $87 is $77.00.

Jeff Bailey : 11/20/2008 4:43:54 PM

PBR $14.94 -16.34% ... WHY is it at another 52-week low?

Jeff Bailey : 11/20/2008 4:43:06 PM

CVX $64.40 -8.79% ... WHY isn't it at 10/10/08 intra-day low of $55.50.

Jeff Bailey : 11/20/2008 4:42:08 PM

XOM $68.51 -6.68% ... WHY isn't it at 10/10/08 intra-day low of $56.51.

Jeff Bailey : 11/20/2008 4:39:34 PM

USO went out at $39.55 -8.57% ... Probably need to remind traders that BULLISH and BEARISH vertical counts can be achieved, exceeded, sometimes NEVER achieved. They are used of RISK assessment ONLY.

Based on the science of ballistics.

Jeff Bailey : 11/20/2008 4:35:57 PM

OK oil traders ... bencmark today's date on your charts for today's Nymex futures settle. USO too!

Jeff Bailey : 11/20/2008 4:33:30 PM

YM 7,537 +50 on the extended

Jeff Bailey : 11/20/2008 4:33:08 PM

YM 5-minute interval recap Link

Jeff Bailey : 11/20/2008 4:27:16 PM

They won't ask for a handout either.

Jeff Bailey : 11/20/2008 4:26:25 PM

How the Mighty Have Fallen: Buffett, Other Legends Feel Bear Market Bite ... Link

Ah, but in the U.S. its always been the ability of those than can do for themselves, that brush off the dust, make the adjustment, and manage their RISK.

I'll guarantee you some on the list will be back.

Down, but not out.

Jeff Bailey : 11/20/2008 4:23:20 PM

Actually, you know from my commentary over the years that that is a problem for us free market types.

Jeff Bailey : 11/20/2008 4:22:17 PM

That the problem some have ... how does "lifting the weak" with handouts make anything that much stronger in a free market economy?

Jeff Bailey : 11/20/2008 4:21:05 PM

Boy, I don't know about you, but I'm getting the impression that "bail out" is not a word that market participants are warm to.

Jeff Bailey : 11/20/2008 4:18:08 PM

YM 7,514 ... low now 7,468

Jeff Bailey : 11/20/2008 4:17:33 PM

YM 7,480 ... now a new regular session low.

Jeff Bailey : 11/20/2008 4:17:02 PM

YM 7,499 here though ... humans overwhelming the computers.

Jeff Bailey : 11/20/2008 4:16:37 PM

7,532 would get DAILY S1 an EXACT match.

Jeff Bailey : 11/20/2008 4:15:21 PM

7,500 .... that's "too much" and DAILY S1 would be 7,270....

Jeff Bailey : 11/20/2008 4:14:32 PM

7,525 squeezes DAILY S1 to 7,287

Jeff Bailey : 11/20/2008 4:13:47 PM

7528 close/settle gets 7,289 daily S1

Jeff Bailey : 11/20/2008 4:12:27 PM

12 points

Jeff Bailey : 11/20/2008 4:12:05 PM

DAILY S1/WKLY S2 close.

Jeff Bailey : 11/20/2008 4:11:35 PM

IF YM were to go out 7,550 ... DAILYS 7,057, 7,304, Piv= 7,738, 7985, 8419

Jeff Bailey : 11/20/2008 4:08:50 PM

Downside RISK, or potential REWARD levels assessed to 7,292 and 6,365. I could quick calc a daiy (regular session derived).

James Brown : 11/20/2008 4:08:22 PM

CNBC saying more than half of S&P 500 at 52-week lows. Wonder how many are at five-year lows?

Jeff Bailey : 11/20/2008 4:07:47 PM

Sill a double correlation at MNTHLY S1 and WKLY S1. But now view RESISTANCE.

Jeff Bailey : 11/20/2008 4:06:27 PM

YM 7,548 ... battles to hold MONTHLY 19.1% ... (regular session high/low/close derived).

Keene Little : 11/20/2008 4:06:00 PM

Today was also one of the biggest moves I've seen in the 30-year bond--up 5 handles. That's just huge. There's a real flight to safety from stocks into bonds and it's part of the capitulation. We're getting close now but don't rush to buy this.

James Brown : 11/20/2008 4:04:55 PM

I agree 110% Keene! Flat is probably a great position right now.

James Brown : 11/20/2008 4:05:12 PM

Quick glance at the (partial) 1996-1997 market for the S&P 500. What might be new support levels. Chart: Link

Keene Little : 11/20/2008 4:03:42 PM

That was downright ugly. The selling hits stops in the last hour and especially with opex hedging the selling intensified. It's always a challenge to figure out whether that "extra" selling will see follow through the next day or not. At this point it's looking like we're into the capitulation stage of the decline but it may have more to go before we see a bottom. It's a dangerous point to short the market and it's clearly too early to buy it. It may be frustrating missing a big move but flat is a good position.

Jeff Bailey : 11/20/2008 4:02:36 PM

SKF 268.70 +20.58% ... "overhead supply" limited. Or is it ... where's the support?

Jeff Bailey : 11/20/2008 3:59:36 PM

INDU 7,513 -6.06% ... WEAK again today.

Jeff Bailey : 11/20/2008 3:59:10 PM

FXY $106.48 +1.99% ... yen STRONG again today.

James Brown : 11/20/2008 3:59:06 PM

S&P 500 index plunging past its October 2002 lows near 775. Many were expecting those lows to act as support. We're now looking at 1997 levels for the market.

Jeff Bailey : 11/20/2008 3:57:48 PM

Speaking of legging out ... How I've traded EEV since 09/25/08 with PRICE benchmarks Link

Jeff Bailey : 11/20/2008 3:56:38 PM

SPX 757.84

Jeff Bailey : 11/20/2008 3:56:26 PM

VIX.X alert! 80.51 ... gets the trade at MONTHLY 80.9% retracement.

James Brown : 11/20/2008 3:53:18 PM

PremierInvestor Shorts that hit our targets today: EWG, IJR, JCP, NOC, and SLX.

James Brown : 11/20/2008 3:48:39 PM

Exit Alert! ... IBM just hit our secondary target to exit at $71.00.

Jeff Bailey : 11/20/2008 3:47:25 PM

PHM $7.50 alert! ... See my old MM trade blotter.

One thing about profiling trades is discipline of setting alerts from actual profile.

I at least know PHM is trading a level that at one point in time past, I didn't think it should have.

Jeff Bailey : 11/20/2008 3:45:41 PM

F $1.24 -1.58% .... that's pretty close to the news benchmark.

James Brown : 11/20/2008 3:45:13 PM

Out of the eight put plays on the OI newsletter seven of them hit our targets today. Time to book some profits here.

Jeff Bailey : 11/20/2008 3:45:13 PM

GM $2.94 +5.37% ... do I hear $2.80

James Brown : 11/20/2008 3:44:10 PM

COF back under our exit target at $25.50 again.

Jeff Bailey : 11/20/2008 3:43:46 PM

Nothing wrong with that. Make a paycheck!

Jeff Bailey : 11/20/2008 3:43:23 PM

Legging out of a couple James?

James Brown : 11/20/2008 3:42:53 PM

CNBC guest suggesting that if we close here their new target is 725 or 700 for the S&P 500.

Keene Little : 11/20/2008 3:41:54 PM

SPX has now rung the bell at 768. But the DOW is 200 points above its 2003 low at 7416 and 400 points above its 2002 low at 7197. For the DOW to tag its lower targets that would have SPX down to about 730-750.

James Brown : 11/20/2008 3:41:06 PM

IBM is now off 3.5% at $73.40 and nearing our secondary target to exit at $71.00.

Jeff Bailey : 11/20/2008 3:40:43 PM

Once above, never below, once above never below, once above never below.

Partials, partials,

James Brown : 11/20/2008 3:40:21 PM

Exit Alert!... OI put play LLL has hit our secondary target to exit at $61.00. The stock is off 6.7% at $60.75.

Jeff Bailey : 11/20/2008 3:40:01 PM

EEV alert! $124.22

James Brown : 11/20/2008 3:39:44 PM

KSS is back under our exit target at $25.50.

Jeff Bailey : 11/20/2008 3:39:34 PM

Ooooooeeee ... PBR's P/E just 3.8 now.

XOM's 7.7 and CVX's 5.7.

Ah, but those debt/equity ratios. That a DIFFERENT story.

Jeff Bailey : 11/20/2008 3:37:53 PM

PBR $15.34 -14.16% ...

James Brown : 11/20/2008 3:37:50 PM

Honda Motor Ltd (HMC) is nearing its 2008 lows near the $19.00 level. This would be a good spot to look for an oversold bounce. Shares are down 3% to $19.26. If it does bounce I wouldn't expect it to last very long...maybe a rebound to its 10-dma.

Jeff Bailey : 11/20/2008 3:37:35 PM

CVX $66.25 -6.14% ...

Jeff Bailey : 11/20/2008 3:37:20 PM

XOM $71.55 -2.54%

Jeff Bailey : 11/20/2008 3:36:07 PM

OIH $69.28 -13.20% ...

Jeff Bailey : 11/20/2008 3:35:52 PM

OIX.X 485.09 -8.81% ...

Jeff Bailey : 11/20/2008 3:35:32 PM

USO alert! $39.95 -7.65% ...

James Brown : 11/20/2008 3:33:00 PM

Several minutes ago CNBC had a bit on the S&P 500 and how 175 of the 500 stocks had fallen below the $4 billion market cap requirement for inclusion into the index that new candidates must meet.

James Brown : 11/20/2008 3:31:04 PM

Trading Idea: The intraday bounce in shares of Partnerre Ltd (PRE), an insurance stock, is failing at the $60.00 level. This looks like an entry point for new bearish positions with a tight stop around $60.25ish. The P&F chart is bearish with a $44 target. I would expect some support at $55.00 and then the $50 region.

Keene Little : 11/20/2008 3:29:24 PM

SPX didn't hold this morning's low and is now only 4 points from the October 2002 low of 768. How many stops do you suppose are parked under that level? This has the potential to get real nasty into the close if it doesn't hold.

Jeff Bailey : 11/20/2008 3:28:24 PM

Uncle Al / Internet for those that don't know Link

Some today still think this was a critical part of why Mr. Gore did not get the White House.

James Brown : 11/20/2008 3:28:09 PM

I think that no matter what side of the political divide you fall on the movie was worth watching.

James Brown : 11/20/2008 3:26:46 PM

Funny you should mention Gore. I am not making any political statements or voicing any opinion on his global warming crusade but I just happened to watch the last 75% of his Inconvenient Truth last night and the movie was very well done. It's a highly polished presentation.

James Brown : 11/20/2008 3:24:26 PM

...Exide Technologies (XIDE) is a big winner today. The stock is up 22.5% to $3.69. Honestly I've never heard of them before but I noticed what appears to be a bullish development on the daily chart's RSI indicator. Today's session is a bullish engulfing candlestick (so far). I didn't see any news to account for the big rebound.

Jeff Bailey : 11/20/2008 3:22:37 PM

Need to thank Uncle Al for inventing the Internet. (wink)

Or so he claimed.

Jeff Bailey : 11/20/2008 3:21:28 PM

Around the world in just seconds ... incredible with all the technology today.

Jeff Bailey : 11/20/2008 3:20:13 PM

Yes, there could be a "tie"

Jeff Bailey : 11/20/2008 3:20:02 PM

EEV $120.93 +8.71% ...

Jeff Bailey : 11/20/2008 3:18:56 PM

YM 7,834 ... quad

Jeff Bailey : 11/20/2008 3:17:57 PM

YM 7,811 .... back "in the zone"

James Brown : 11/20/2008 3:16:44 PM

Goldman Sachs (GS) is trying to bottom again with a "hammer" style candlestick pattern. GS is bouncing sharply from its $49.00 intraday low and shares are up 4% at $57.25. Don't be fooled. Wait for some confirmation. GS produced a hammer candlestick on Nov. 13th and rolled right over the very next day. Looking at the intraday chart there appears to be possible resistance (old support) near $60.00.

Jeff Bailey : 11/20/2008 3:16:40 PM

Ahhhhh.... "equilibrium" thinks the day trader.

Jeff Bailey : 11/20/2008 3:16:20 PM

SMH $15.52 +1.57% ... 50% "dynamic" at $15.54.

James Brown : 11/20/2008 3:14:09 PM

Another way to play the U.S. treasury markets are the iShares. The TLT and IEF both invest in the treasury market and money is rushing into them.

James Brown : 11/20/2008 3:10:46 PM

Deutsche Bank suggesting that crude oil, which closed under $50/bbl today, could hit $40.00 by year's end.

Jeff Bailey : 11/20/2008 3:11:14 PM

You can see how industry is "filling the gaps" between cash and futures.

How they are trying to serve the IRA industry that can only "trade long" (not short in some IRA).

What is IMPORTANT for traders and investors to understand is the REASON for the 200x and 300x.

It is so SMALLER ACCOUNTS can trade a 200x and get some "umph" from a $3-point DIA move.


Keene Little : 11/20/2008 3:10:01 PM

So far this afternoon's low is showing bullish divergences against this morning's low. It might not hold but it's hinting that the low will hold, to be followed by another rally leg back up tomorrow.

James Brown : 11/20/2008 3:08:22 PM

The 3x ETFs have only been out for a couple of weeks.

Jeff Bailey : 11/20/2008 3:07:38 PM

I've had some growing client interest in position trading them.

James Brown : 11/20/2008 3:07:49 PM

3x ETFs
BGU bull
BGZ bear
TNA = small cap 3x bull ETF
TZA = small cap 3x bear ETF
ERX = energy bull 3x ETF
ERY = energy bear 3x ETF
FAS = financial bull 3x ETF
FAZ = financial bear 3x ETF.

Jeff Bailey : 11/20/2008 3:06:54 PM

I need those 300x too! What are those? They're pretty new.

Jeff Bailey : 11/20/2008 3:06:23 PM

In my "favorites" (browser) James! Always at the ready.

Jeff Bailey : 11/20/2008 3:05:35 PM

Over the years, especially you PIVOT traders, I try and instill the REGULAR session importance. Here's the ULTRASHORT Dow Jones Industrials page Link . Now click on the DOWNLOAD product literature and see how they get the 200% inverse.

Can do the SAME for the ULTRA(long)

James Brown : 11/20/2008 3:05:33 PM

Here's that chart of the TWM: Link

James Brown : 11/20/2008 3:02:49 PM

Nice link! Jeff

Jeff Bailey : 11/20/2008 3:02:07 PM

ProShares LONG and SHORT Link

Always have "both sides" ready to go.

James Brown : 11/20/2008 3:00:43 PM

Hmm... Interesting to see the SSG and SRS. Both of these double-short ETFs are pulling back from their intraday highs.

Note: the TWM, Ultrashort Russell 2000 smallcap ETF has broken out past clear resistance. I'll post a chart in a moment.

If you were curious here are some ultra-short (2x) ETFs that might be worth watching. Volatility aside I would hesitate to trade the low-volume ones.

UltraShort QQQQs - QID
UltraShort Dow Industrials - DXD
UltraShort S&P 500 - SDS
UltraShort S&P Midcap - MZZ
UltraShort S&P Small cap - SDD
UltraShort Russell 2000 small cap - TWM
UltraShort Basic Materials - SMN
UltraShort Consumer Goods - SZK
UltraShort Consumer Service - SCC
UltraShort Financials - SKF
UltraShort Health Care - RXD
UltraShort Industrials - SIJ
UltraShort RealEstate - SRS
UltraShort Semiconduct - SSG
UltraShort Oil & Gas - DUG
UltraShort Technology - REW
UltraShort Utlities - SDP
UltraShort MSCI - EFU
UltraShort MSCI Emerging Markets - EEV
UltraShort Japan - EWV
UltraShort China - FXP

Jeff Bailey : 11/20/2008 3:00:26 PM

Pocket change no doubt.

Jeff Bailey : 11/20/2008 3:00:10 PM

PBR $15.73 -11.92% ... even the great ones like Mr. Soros (at $50-ish) make some mistakes.

Jeff Bailey : 11/20/2008 2:57:58 PM

EEV ... how I've traded the EEV since 09/25/08. As I have profiled/taught over the years, and hopefully will be able to again, I'll trade partials. ESPECIALLY in these types of securities. Just like an institutional trader. Link

Jeff Bailey : 11/20/2008 2:50:59 PM

EOG getting hammered too James!

Keene Little : 11/20/2008 2:50:51 PM

SPX had two equal legs up from this morning and now it would have two equal legs down at 778.41 for essentially a retest of this morning's low. Watch for potential support,e specially if bullish divergences accompany a turn back up (which so far looks possible).

Jeff Bailey : 11/20/2008 2:50:08 PM

EEV Daily Interval chart I've been trading Link

Couldn't help but notice last night's offer.

James Brown : 11/20/2008 2:49:28 PM

The SMN UltraShort (2x) Basic Materials ETF is surging to new highs but will it be able to breakout past this line of higher highs? Chart: Link

James Brown : 11/20/2008 2:45:07 PM

Wow, the emerging markets are really getting hammered. The EWZ put we had is heading back toward its intraday lows.

Developed markets are also sliding toward their October lows. The PremierInvestor newsletter has a short play on the EWG German ETF and it just hit our target at $15.05 today. The October low for the EWG was $14.75 and shares actually hit $14.55 this morning.

James Brown : 11/20/2008 2:40:37 PM

WYNN also continuing to plummet, down another 9.7% at $30.31 and aiming for its October lows near $28.00. WYNN has been trying desperately to hold onto the $30.00 mark all day long but has a very clear bearish wedge pattern of lower highs on the intraday chart.

Jeff Bailey : 11/20/2008 2:39:59 PM

PBR $15.73 -11.92% ... just ask Mr.

Jeff Bailey : 11/20/2008 2:38:54 PM

Yes ... follow the leader. Understand/review my dynamic.

You think its bad here at home?

James Brown : 11/20/2008 2:38:46 PM

Las Vegas Sands (LVS) continues to get crushed. The stock is down 15% and actually under its October lows at $4.30.

Jeff Bailey : 11/20/2008 2:38:20 PM

Now you EEV traders. Take Jame's "note" into observation.

James Brown : 11/20/2008 2:37:17 PM

What do you mean, Jeff?

Jeff Bailey : 11/20/2008 2:36:38 PM

James ... what option would you consider on the SKF. Reminding our traders of HIGH premiums currently found.

Jeff Bailey : 11/20/2008 2:34:28 PM

02:00 Internals found at this Link

Jane Fox : 11/20/2008 2:33:16 PM

WASHINGTON (MarketWatch) -- The Big Three U.S. automakers must submit a new plan to Congress in order to be considered for U.S. aid, Senate Majority Leader Harry Reid said Thursday. Reid said auto-state senators had reached a compromise plan but that it wouldn't pass the House or Senate. He said Congress would return the week of Dec. 8 if Ford , General Motors and Chrysler come up with a new plan.

James Brown : 11/20/2008 2:32:19 PM

The bounce in IBM is fading. The stock is trading back under our first exit target at $75.50.

James Brown : 11/20/2008 2:30:35 PM

So I was thinking... "what if the market does stage a rebound? What would be a good vehicle to trade the bounce?" One idea was buying puts on the high-flying, extremely volatile double-short financial ETF... the SKF. The SKF just surged to new all-time highs this morning and it might be forming some sort of blow-off top. Currently it's trading +7.2% at $239.00. So.... a quick glance at the December options montage and ouch!... the December $200 strike put is trading around $35-36. Seems more than a little expensive. Whenever you think this market has bottomed traders might be better off selling premium. Consider some sort of credit call spread. I'm not suggesting one right now but just to give you a frame of reference the December $250 call strikes are trading around $50.00 each.

Jeff Bailey : 11/20/2008 2:29:08 PM

QCharts showing IVN $1.77 -4.32% as #1 most active. Not what I get from the NYSE (C, GE, F, BAC, JPM, GM, WFC, AIG, PFE, WB)

Jane Fox : 11/20/2008 3:09:14 PM

Ford is rallying in hopes of a speedy emergency loan. Link

Jeff Bailey : 11/20/2008 2:22:16 PM

Ya think $31.00 and $40.00 on Friday?

Jeff Bailey : 11/20/2008 2:21:53 PM

GSG $31.01 -3.96% ...

Jane Fox : 11/20/2008 2:21:43 PM

Paulson's attempt at humor was actually pretty good. "Until the tide goes out you never know who is swimming naked."

Jeff Bailey : 11/20/2008 2:21:25 PM

GSG's Nov. Max Pain $44.00.

Yep, more like USO's isn't it? Oil is biggest weight.

Jeff Bailey : 11/20/2008 2:20:44 PM

Isn't gold thought to be a hedge against inflation?

Aren't commodity prices a key to inflation? Or lack of it?

Jeff Bailey : 11/20/2008 2:19:53 PM

As I scramble to update internals, it crosses my mind it might be useful to know where the GSG "Max Pain" is at.

Keene Little : 11/20/2008 2:18:28 PM

If the market drops lower in the next 30 minutes I'm thinking we'll stay trapped in a sideways consolidation for the remainder of the day, maybe close at SPX round-number 800.

Jeff Bailey : 11/20/2008 2:17:56 PM

Morning low Qs1.

Jeff Bailey : 11/20/2008 2:17:37 PM

You Pivot traders know where it is at.

Jeff Bailey : 11/20/2008 2:16:46 PM

GLD $73.88 +2.22% ... Nov "Max Pain" $75.00 at last night's close.

Jeff Bailey : 11/20/2008 2:11:31 PM

And ask ... "What does the MARKET know that we have yet to consider?"

Jeff Bailey : 11/20/2008 2:11:02 PM

Ah, but that's what us traders and investors do.

We try to figure out WHY the market does what it does. And when/IF it doesn't do what the CHARTS and RISK/REWARD management say they should do, then we have to assess further downside/upside.

Jeff Bailey : 11/20/2008 2:09:45 PM

If $40.00 is the "destiny" trade, its still crazy to think a bear holds out for it.

Just as crazy as buying a bond than yields 0.01% I guess.

Jeff Bailey : 11/20/2008 2:08:34 PM

WKLY S2 at $40.22

Jeff Bailey : 11/20/2008 2:08:08 PM

USO $40.73 ... about to test morning low.

Jeff Bailey : 11/20/2008 2:06:16 PM

SPX 800.00 on the button.

Jeff Bailey : 11/20/2008 2:04:54 PM

Don't mean to leave you Ford followers out of things ... can repeat my activity/observations.

Jeff Bailey : 11/20/2008 2:03:58 PM

On the GM, I'm doing the math of $4.00 - $1.20 = $2.80

Jeff Bailey : 11/20/2008 2:01:30 PM

How defensive is this market James when it find that type of yield attractive? For 13-weeks at least.

James Brown : 11/20/2008 2:00:29 PM

Jeff mentioned the yield on the 13-week treasury. It's incredible to see it this low. The intraday dip was a yield of 0.05%. Here's a chart of daily and monthly trends. Chart: Link

Jeff Bailey : 11/20/2008 1:54:07 PM

Note up/downtick on the GM Nov $4 put.

Jane Fox : 11/20/2008 1:53:16 PM

WASHINGTON (MarketWatch) -- A small bipartisan group of lawmakers have reached a deal to buoy the struggling U.S. automobile industry, finding common ground after two furious days of lobbying on Capitol Hill by the battered Big Three automakers.

Details weren't immediately available, but the office of Sen. Carl Levin, D-Mich., said agreement had been reached. Senators were set to speak to reporters at 2:30 p.m. Eastern Thursday.

It was not clear whether the compromise plan could draw enough support to get through the entire Senate, however, and reports were also circulating that Speaker of the House Nancy Pelosi would not go along with the compromise, and was pushing Congress to return again in December to continue working on a package.

Jeff Bailey : 11/20/2008 1:53:05 PM

GM option chain (QCharts isn't the most accurate real time) Link

James Brown : 11/20/2008 1:52:08 PM

Correction: the bottom chart of my TNX 10-year yield was a monthly not a weekly

Jane Fox : 11/20/2008 1:52:00 PM

Bulls remember the AD line is -1626, AD volume is well below 0 and AD ratio (of course) is well below 1. Not an enviroment to try any kind of long positions other than quick day trades.

James Brown : 11/20/2008 1:49:50 PM

The yield on the 10-year treasury bond is nearing the 2003 lows. Chart: Link

Keene Little : 11/20/2008 1:49:46 PM

If we get another leg up in today's bounce the next resistance level is the dowtrend line from Monday the 17th, currently near SPX 828. It'll be interesting to see if SPX settles near 825 today (the multiples of 25 are where you find the largest option open interest).

Jeff Bailey : 11/20/2008 1:47:12 PM

QCharts' GM option chain ... Most active shows Dec. $2.50 Put, Jan10 $10 Call, Nov $4 Put as 3-most active.

James Brown : 11/20/2008 1:44:39 PM

Just amazing to see Citigroup under $5.00 this morning.

James Brown : 11/20/2008 1:43:10 PM

After eight down days in a row Sears (SHLD) is trying to bounce. This stock is so oversold that the nearest overhead resistance is probably $10 to $15 overhead. Shares could be setting up for a violent short covering rally like the one that occurred in late October but I am not suggesting any trades right here. Too aggressive for me.

Jeff Bailey : 11/20/2008 1:42:52 PM

Minute by minute, hour by hour, day by day.

Jeff Bailey : 11/20/2008 1:42:31 PM

Fascinating .. fascinating indeed ... Link

BLUE=conventional. RED= Bankrupt.

James Brown : 11/20/2008 1:38:53 PM

Apple Inc. (AAPL) broke significant support at the $85.00 level this morning. Shares dipped to $80.00 and managed an oversold bounce back to $86.45 but that bounce is fading fast. AAPL is still down 2.9% at $83.71. The P&F chart is suggesting a $60.00 target.

James Brown : 11/20/2008 1:36:45 PM

Google (GOOG) has broken down under last week's lows at $280. Shares are off 2.3% at $273.51. I think it was yesterday we mentioned that GOOG's weekly chart suggested possible support in the $270-275 zone. The low today was $268.00. All the technicals are bearish and oversold but I'm not seeing any hint at a reversal yet.

James Brown : 11/20/2008 1:33:33 PM

The GLD gold ETF is up 1.9% to $73.67 even as the U.S. dollar UUP is up 0.3% and climbing back to the $27.00 level. Normally these trade with an inverse relationship. (if UUP is up, then the GLD is down)

Jeff Bailey : 11/20/2008 1:32:59 PM

GM 10-minute interval chart (for some time perspective) with QCharts' DAILY and WKLY Pivot levels turned on. Link

This and other auto stock charts may be the "most important" of the day. Especially those that derive a paycheck from each.

James Brown : 11/20/2008 1:25:51 PM

Yesterday's breakdown under support in railroad giant BNI continued this morning. The stock dipped to $70.33 and staged an oversold bounce back to $75.87. Now that bounce is beginning to roll over.

Jeff Bailey : 11/20/2008 1:25:50 PM

12:00 Internals at this Link

I did not get the US Dollar Index DXY at 10:00 AM ET.

Keene Little : 11/20/2008 1:25:45 PM

The pullback from today's high would now have two equal legs down at SPX 790.74 which obviously be a break of today's uptrend line so if the line doesn't hold watch to see if the 790-791 level holds.

James Brown : 11/20/2008 1:21:31 PM

Wal-Mart (WMT) is working on a bullish engulfing candlestick pattern but the trend is still bearish with lower highs and lower lows.

James Brown : 11/20/2008 1:20:30 PM

Observing that oil & gas stock EOG is breaking down from its three-week consolidation and trading range with today's 6% drop under $73.00. This could lead to a retest of support near $60.00. The Point & Figure chart is forecasting a $56 target.

Keene Little : 11/20/2008 1:17:17 PM

If the market is going to work its way higher today, which I think is a good chance of happening, watch the uptrend line from this morning's low, currently near SPX 795, for support. Breaking it doesn't negate the potential for another leg up but it would provide a visible support level that other traders might use.

Jeff Bailey : 11/20/2008 1:17:07 PM

James! That "makes sense" ...

James Brown : 11/20/2008 1:16:43 PM

Note: Currently OI put play L-3 Communications (LLL) has surpassed our first target 65.25 (hit yesterday) and is down another 4.6% at $62.10. Our secondary target to exit is $61.00.

James Brown : 11/20/2008 1:15:32 PM

Jeff, most of these targets appeared to have been hit in the first 30 to 45 minutes this morning.

Jeff Bailey : 11/20/2008 1:14:57 PM

TSN $4.85 -3.76% ... might make me sick.

James Brown : 11/20/2008 1:14:57 PM

The last exit alert! for this morning was on OI put play Kohl's (KSS). KSS dipped to $25.40 and our first exit target to take profits was $25.50. The stock is bouncing after testing its October lows and KSS is currently up 6% at $28.00.

Jeff Bailey : 11/20/2008 1:14:32 PM

AET $20.07 -5.50% ... makes me sick.

Jeff Bailey : 11/20/2008 1:14:14 PM

AVP $19.43 -6.94% ... makes me sick.

Jeff Bailey : 11/20/2008 1:13:13 PM

James! What time were those levels hit? (see YM intra-day chart(s) for potential ties.

James Brown : 11/20/2008 1:12:43 PM

And another one... exit alert! for IBM. Shares hit a low of $74.58. Our first target to take profits was $75.50. Currently the stock is bouncing (+1.5%) at $77.13.

Jeff Bailey : 11/20/2008 1:12:07 PM

Where more than likely ... 99% of the volume is at.

James Brown : 11/20/2008 1:11:40 PM

Yet another exit alert!... this one on OI put play Capital One (COF). The stock hit a low of $24.86 this morning. Our target to exit was $25.50. Currently COF has bounced back from the $25.00 region and is up 4.2% to $27.59.

Jeff Bailey : 11/20/2008 1:11:25 PM

But do it from the REGULAR session.

Jeff Bailey : 11/20/2008 1:10:57 PM

You computer programmers know the IF, THEN, ELSE statement of computer programming.

Just like the pivot levels too.

If it does this, then to that, ELSE to this.

James Brown : 11/20/2008 1:10:23 PM

Plus we have an exit alert! on our OI put play for Potash (POT). Shares sank to $57.52 this morning. Our exit target was $61.50. POT is currently -4.7% at $60.98.

Jeff Bailey : 11/20/2008 1:10:01 PM

IF ... today's news meaningful longer-term, THEN Ford's stock really should go below today's low. (perhaps the reaction benchmark).

ELSE ... not meaningful and still RISK of bankruptcy.

James Brown : 11/20/2008 1:09:25 PM

I also have an exit alert! for our OI put play on the IWM small cap ETF. The IWM hit $39.66 this morning. Our target was $41.00. Currently the IWM is -0.9% at $40.98.

James Brown : 11/20/2008 1:08:22 PM

Exit Alert! - In case you missed it, EWZ, the Brazil ETF, an OI put play, hit our target at $29.50 this morning. Shares of the EWZ sank to $27.38 at its worst levels before bouncing back. Currently the EWZ is down 4.2% at $28.93.

Jeff Bailey : 11/20/2008 1:08:15 PM

Ford (F) $1.51 +20.63% ... it was about $1.20 on the reaction.

Jeff Bailey : 11/20/2008 1:07:35 PM

Now, just as we "pretended" to figure out what a YM bull/bear was doing at levels, we should do the same with the autos.

Setting some alerts at the time benchmark reaction.

Jeff Bailey : 11/20/2008 1:06:18 PM

GM was $2.25 at that time,

Jeff Bailey : 11/20/2008 1:05:39 PM

GM $3.48 +24% ... intra-day observation probably had the news coming at about 12:15 PM

Jeff Bailey : 11/20/2008 1:04:09 PM

Jane's got it ... 12:45:11

Jeff Bailey : 11/20/2008 1:03:18 PM

CNBC reporting some sort of "deal" with automakers took place this morning.

Keene Little : 11/20/2008 1:01:28 PM

The bounce off this morning's low is a 3-wave move so far and it achieved equality in the two legs up by tagging SPX 818.67. Therefore the risk for longs is a return back down to make a new low before setting up a bigger bounce. Otherwise we might only be at the start of what will turn into a larger corrective pattern to the upside (and the reason I'm cautioning both sides to be aware of a very choppy pattern full of whipsaws). Trade quickly and get out even faster if you're trading today.

Jeff Bailey : 11/20/2008 1:00:17 PM

So ... STILL seeing SIMILARITY. ALWAYS, and I do mean ALWAYS looking for the DIVERGENCE.

Jeff Bailey : 11/20/2008 12:59:21 PM

FXY's daily pivot $103.81

Jeff Bailey : 11/20/2008 12:59:04 PM

Then check it? Is my analysis/observations correct?

Jeff Bailey : 11/20/2008 12:58:36 PM

FXY 103.81 -0.56% ... easing from session high of $105.79. Guess where the daily pivot is?

Jeff Bailey : 11/20/2008 12:57:15 PM

Both sides ... always both side of the trade.

Jeff Bailey : 11/20/2008 12:56:58 PM

Now ... Just as I wouldn't not have shorted at the DAILY S1, I would not be looking long the DAILY Pivot.

Jeff Bailey : 11/20/2008 12:56:11 PM

That's the trend from regular session 11/13 low to the regular session 11/18 pullback low.

Jeff Bailey : 11/20/2008 12:55:09 PM

YM 8,157 ... After kiss of DAILY Pivot and comes to trend from underneath.

Jane Fox : 11/20/2008 12:45:11 PM

SAN FRANCISCO (MarketWatch) -- A bipartisan group of auto-state senators say they have reached a compromise to speed emergency loans to Detroit's Big Three car makers, the Associated Press reported Thursday. Republicans and Democrats plan to present the proposal at a mid-afternoon news conference Thursday but it was not clear whether the compromise plan could draw enough support to get through the Senate, the news agency said.

Jane Fox : 11/20/2008 12:44:14 PM

WASHINGTON (MarketWatch) -- Manufacturing conditions in the Philadelphia region deteriorated to their worst level in 18 years in November, the Federal Reserve Bank of Philadelphia reported Thursday.

The Philly Fed diffusion index fell to negative 39.3 in November from negative 37.5 in October.

This is the lowest level since the recession of the early 1990s when the index bottomed out at negative 48.2.

Economists were expecting a continued slide in the Philly index to negative 40.0 in November, according to a survey conducted by MarketWatch

Jeff Bailey : 11/20/2008 12:39:51 PM

Would close out a YM long from 7900 here at 8,059

Jane Fox : 11/20/2008 12:37:49 PM

The internals have improved substantially but remember the AD line is still below 0, well below 0 at -1200 so the bulls are still very very vulnerable here. Link

Jeff Bailey : 11/20/2008 12:35:59 PM

Oh my! YM pullback low was, was, was 7,834.

Jeff Bailey : 11/20/2008 12:35:07 PM

USO $41.92 ... session low has been, been, been $40.66

Keene Little : 11/20/2008 12:34:38 PM

Two equal legs up from this morning's low is at SPX 818.67 so watch that level for possible resistance.

Jeff Bailey : 11/20/2008 12:33:50 PM

VIX.X 74.81 +0.74% ... Daily Piv at 72.20.

Jeff Bailey : 11/20/2008 12:32:44 PM

Will note ... NASDAQ NH yesterday was 2.

Same number so far today.

Jeff Bailey : 11/20/2008 12:31:35 PM

YM 8,060 ... busts a move.

Jeff Bailey : 11/20/2008 12:30:41 PM

Maybe need to think about breaking out the NYSE and NASDAQ

Jeff Bailey : 11/20/2008 12:30:05 PM

Analysis: So, those of you that compile all the internals into one pot at the end of the day, you might need to re-think things a bit.

Jeff Bailey : 11/20/2008 12:29:25 PM

Pretty good idea with NYSE Comp 4,897.44 -2.28% today, we aren't seeing a double in NH from BULL-side view.

Jeff Bailey : 11/20/2008 12:27:54 PM

Yesterday, NYSE showed 20 NH. So far today, 40.

Jeff Bailey : 11/20/2008 12:26:46 PM

A lot more NH at the big board too.

Remember though! Probably some NYSE-listed "inverse" ETF's hitting new highs as major averages hit new lows.

Jeff Bailey : 11/20/2008 12:25:29 PM

Lots of new lows too!

Jeff Bailey : 11/20/2008 12:24:45 PM

Wow! We've got some volume today at the big board.

Jeff Bailey : 11/20/2008 12:23:02 PM

Can maybe tie that with Jane's morning "internals"

Jeff Bailey : 11/20/2008 12:22:30 PM

See your little "zone" today? DAILY R2 79.86 and MONTHLY 80.9% 80.53.

Jeff Bailey : 11/20/2008 12:21:34 PM

VIX.X 76.84 +3.47% ... session high did go almost 80.9% MONTHLY Pivot retracement (80.53) that I've shown. Netled at MNTHLY R1.

Jeff Bailey : 11/20/2008 12:16:37 PM

Good grrrrravy! 13-week at 0.005%.

Jeff Bailey : 11/20/2008 12:13:44 PM

AMD $2.00 -5.66% ... to name just one.

Jeff Bailey : 11/20/2008 12:13:17 PM

Should note INTC is nasdaq listed, but there's quite a few NYSE-listed chippers.

Jeff Bailey : 11/20/2008 12:12:41 PM

QQQQ $26.71 -0.55% ... has slipped back under WKLY S2.

Jeff Bailey : 11/20/2008 12:11:00 PM

SMH $15.66 ... at $15.59, your "dynamic" would have 38.2% of day's range.

Jeff Bailey : 11/20/2008 12:09:25 PM

XLF $9.88 -6.08% ... bundles them together. IUX.X -4.54% too.

Jeff Bailey : 11/20/2008 12:08:19 PM

SMH $15.59 +2.02% ...

Jeff Bailey : 11/20/2008 12:07:53 PM

BKX.X -6.76%, BIX.X -4.41%, XBD.X -2.6% ... also 12:17:17

Keene Little : 11/20/2008 12:07:34 PM

Assuming for the moment that we've seen the low for today and for the week, the SPX 60-min and daily charts show where I think we are in the pattern--either a bounce up to maybe 850 and then a final low by the end of the month (pink) or the start of the bigger rally into February. If we get a new low today/tomorrow after a small consolidation I think 768 will hold and then start the bigger bounce.
60-min: Link
daily: Link

Jeff Bailey : 11/20/2008 12:07:17 PM

OIH -9.47% and XNG.X -9.61% ... these notable too. More for INDU/SPX/OEX traders.

Jeff Bailey : 11/20/2008 12:05:13 PM

EEV $116.80 +5.00% ... will update last night's comments in a little bit.

Jeff Bailey : 11/20/2008 12:04:18 PM

There may also be some sort of news in the SMH sector that I'm not aware of. I have not been following news flows this morning.

Jeff Bailey : 11/20/2008 12:00:33 PM

Very short-term trend also ...

Jeff Bailey : 11/20/2008 11:59:12 AM

SMH $15.74 +3.01% ... Quick capture with QCharts (regular session derived) DAILY and WKLY Pivot levels Link

Jane Fox : 11/20/2008 11:56:21 AM

The tape is getting real ugly now - all over the place with long tails. I hate long tails. I feel like a cat in a room full of rocking chairs and there is a rocking chair just waiting to nail me.

Jeff Bailey : 11/20/2008 11:55:30 AM

Decent low risk short with tight stop. SMH, maybe QQQQ even.

Jeff Bailey : 11/20/2008 11:54:49 AM

Oh My! ...

Jeff Bailey : 11/20/2008 11:53:54 AM

SMH $15.78 ...

Jeff Bailey : 11/20/2008 11:51:36 AM

Analysis: If my earlier analysis is correct and SMH action suggests short-covering, then for short-cover to abate, SMH would slip back under its DAILY Pivot.

Jeff Bailey : 11/20/2008 11:50:48 AM

OK ... SMH's DAILY Pivot is $15.78.

Jane Fox : 11/20/2008 11:50:03 AM

Only 2.4% of the S&P stocks are above their 200 day moving averages.

Jeff Bailey : 11/20/2008 11:49:51 AM

QQQQ has reclaimed WKLY S1.

Jeff Bailey : 11/20/2008 11:48:45 AM

SMH $15.90 +4.05% ...

Jane Fox : 11/20/2008 11:48:38 AM

The MSCI world Index is down 51.2% from its October 2007 high

The MSCI Emerging Market Index is down 63.4% from its Oct 2007 high. Just ain't nowhere to hide.

Jeff Bailey : 11/20/2008 11:47:45 AM

Fascinating "tie" even there isn't it.

Jeff Bailey : 11/20/2008 11:45:20 AM

YM 7,912 ... while only 30 stocks, here's a 1-minute interval Link

Keene Little : 11/20/2008 11:45:04 AM

Looking at the move down from Monday, there are some internal Fib projections that were met this morning for the corrective wave pattern to the downside (corrective because it's inside a descending wedge pattern and therefore will not be an impulsive 5-wave move). As shown on the SPX 30-min chart, the projections were 774.53-777.07 (this morning's low was 776.76): Link

I think we've seen the low for the day. We might just consolidate today between this morning's low and high, which would be bearish for another drop down to at least 768, or we'll start a larger bounce back up into tomorrow. It's too early to tell which scenario will play out but so far it's looking like we can expect more chop. Opex could exacerbate the whipsaws.

Jeff Bailey : 11/20/2008 11:41:43 AM

Wait! Jane did show this Link

Jeff Bailey : 11/20/2008 11:40:40 AM

Boy ... I wish I had gotten today's 10:00 internals as the quad overlap was being traded.

On a possible retest, would be worth knowing what the internals are "saying" about the possibility of that level ...

Jane Fox : 11/20/2008 11:37:59 AM

GMAC Financial Services said it has applied to become a bank holding company to access emergency cash under the U.S. Treasury Capital Purchase Program. Further, the company announced a plan to exchange debt for either cash or newly issued equity notes, potentially giving bondholders a stake in the company's subsidiaries.

Jane Fox : 11/20/2008 11:37:40 AM

General Electric is in talks for funds from four Asian sovereign wealth funds, according to media reports. The talks are being held with China Investment Corp., the Government of Singapore Investment Corp., Temasek Holdings and China Safe Investments, the reports said.

Jeff Bailey : 11/20/2008 11:34:41 AM

What might YOU have done?

Jeff Bailey : 11/20/2008 11:34:23 AM

YM regular session high has been 8,045. That's roughly 4 points above a KNOWN level of very short-term computer resistance.

Think about a computer that BOUGHT the DAILY S1 and 19.1% DAILY pivot retracement. What might it do?

Jeff Bailey : 11/20/2008 11:30:36 AM

YM 7,913 ... 15-minute inteval, now regular session only. Here I "think" as if a MONTHLY position trader. I want to think "who has been on the RightSide of the trade" and what might they be doing? Or, how has an institutional computer kept their positions hedged on a MONTHLY inventory basis. Link ... Then we'll go WEEKLY. Then Daily. That's how institutional computer do it. Year after year. Quarter by quarter. Month by month. Day by day. Hour by hour. Minute by minute.

Jeff Bailey : 11/20/2008 11:17:03 AM

My QCharts5.01 shows that at $15.65 +2.42% ... the SMH is down 24.57% 20DyNet% ... As noted earlier, the strength.

Now, it would have to be my analysis that this group is out of favor to have "outperformed" to the downside.

Analysis: Short covering.

Yes, just about everything (except Treasuries) has fallen during that time, but SMH has tended to be a LEADER to the downside. Thus "out of favor" among buyers.

When I see WEAKER show STRENGTH, I must first assume short-covering and PROFITABLE BEARS locking in gains.

Noted WEEKLY S2, a likely level indeed.

Jeff Bailey : 11/20/2008 11:09:16 AM

YM 7,993 ... after cash/regular session high of 8,034. That's 6 points from a known short-term level of potential computer resistance. While I agree with Jane it was NOT a place to be looking to establish a NEW bull position earlier this morning. I should also think the other side of the trade and KNOW it was not time to establish a NEW bear either (at the triple/quad overlap). Now we look to see ....

Jeff Bailey : 11/20/2008 11:06:19 AM

EIA: Crude Oil, Total Gasoline, Conv. Gasoline and TTL Distillate inventory table I keep at this Link

Note: As USO and Futures near bearish vertical counts, Crude Oil Inventories just about even with year-ago levels. For me, that's "suspicious" enough. For PnF-ers, you know the drill.

Jane Fox : 11/20/2008 11:04:18 AM

Now the bulls have pulled ahead but YM is struggling with 8000.

Jane Fox : 11/20/2008 11:02:33 AM

Citi is shutting down a corporate credit hedge fund called Corporate Special Opportunities after it slumped more than 50% in October.

Jeff Bailey : 11/20/2008 10:58:22 AM

EIA: Nat. Gas and Heating Oil (>500 PPM Sulfer) table I keep at this Link ... As we enter winter in U.S., I'd say Nat. Gas and Heating Oil stockpiles just about even with year-ago.

Jane Fox : 11/20/2008 10:56:59 AM

The bears won that one as YM falls below 7900.

Jane Fox : 11/20/2008 10:55:24 AM

DOW futures are struggling to hold above 7900. It is interesting to watch the fight between the bulls and bears at these century marks.

Jeff Bailey : 11/20/2008 10:52:31 AM

Incredible job by industry ... many products at Friday were juuuust about even with year-ago levels.

Keene Little : 11/20/2008 10:51:22 AM

The big question now, as I look at the strong drop in SPX from yesterday afternoon, is whether we'll get a relatively small consolidation near this morning's low before dropping lower again (to create a 5-wave move down from yesterday's high). The potential for a choppy morning remains high so both sides need to be careful here.

Jane Fox : 11/20/2008 10:50:16 AM

We have some buyers returning to the playing field now. NQ (NDX futures) have even broken their ON highs. Link

Keene Little : 11/20/2008 10:48:33 AM

NDX will be the first index to break back into the green if this bounce continues.

Jeff Bailey : 11/20/2008 10:47:59 AM

YM 7,917 ... looks as if buyers are at the zone.

Jeff Bailey : 11/20/2008 10:47:32 AM

YM 15-minute interval. Golden-brown is Daily Pivot. For your viewing enjoyment and education I've shown the conventional (regular session h/l/c derived) in last night's extended session. Link

Jeff Bailey : 11/20/2008 10:41:25 AM

Will see if shorts make it firm here.

Jeff Bailey : 11/20/2008 10:41:05 AM

YM 7,845 ... fell into my "zone" as shown earlier this week. Now sits at triple correlation. Quad-daily.

Jane Fox : 11/20/2008 10:40:28 AM

I see the internals improving a tad but not enough to get me interesting in anything long quite yet.

Jeff Bailey : 11/20/2008 10:40:05 AM

EIA Weekly Nat. Gas Storage Table Link ... Build of 16 Bcf. Revisions to prior week.

Jeff Bailey : 11/20/2008 10:38:53 AM

US Nat. Gas Fund (UNG) $26.75 -5.51% ...

Jeff Bailey : 11/20/2008 10:37:54 AM

Semiconductor HOLDRs (SMH) $15.59 +2.02% ... bucking trend early. WKLY S2 held buyers.

Jeff Bailey : 11/20/2008 10:36:13 AM

US Oil Fund (Montage) Daily Intervals Link .

Left is same setup as I've been showing for futures (each futures termination). Right is QRTRLY, MNTHLY pivot retracement. Both marked with the PnF chart Bearish Vertical Count.

Jane Fox : 11/20/2008 10:35:18 AM

Even though A Saudi Arabian investor, Price Alwaleed bin Talal bin Abdulaziz Al Saud increased his investment in Citigroup to 5% (up from 4%) the markets are saying its not enough. Citigroup is down 19% today. Many think this will be the next bank to fail. Link

Jane Fox : 11/20/2008 10:30:02 AM

According to an article in Reuters there are 8 banks that need a government infusion: Citigroup, Morgan Stanley, Goldman Sachs, Wells Fargo, JPMorgan, AIG, Bank of America and GE Financial. Combined these 8 companies have 12.2 Trillion in assets and 406 Billion in tangible common capital and will need between 1 and 1.2 Trillion to put balance sheets back to where there can start to lending again. Unfortunately the 1-1.2 Trillion will have to come from the government but the government has only allocated 700 billion (can you believe I used the word "only").

Keene Little : 11/20/2008 10:29:57 AM

Techs continue to hold up better than the others and NDX is getting a little spike up from its low. It looks to me like there's some nibbling going on in the techs in anticipation of a rally. Will those buyers be rewarded soon?

Keene Little : 11/20/2008 10:23:56 AM

At this point it's certainly looking like the market has its eye on SPX 768 for a target. Then of course the big question is whether it will hold. I know many value fund managers are looking to buy at 750.

Jane Fox : 11/20/2008 10:11:16 AM

This is no time to be thinking long unless it is a very fast daytrade. Link

Keene Little : 11/20/2008 10:01:36 AM

This morning's drop can still be considered a throw-under below support at 800 but not if it drops much further. There remains the potential for a big reversal today if we're seeing a bottom get put in. So far that's a big if. But if the decline has morphed into a larger descending wedge pattern we probably won't see the final low until the end of the month as the wave count bounces in a 4th wave and then drops in the final 5th wave (shown in pink on the updated 120-min chart) with a final low probably a little below the 768 support level. There's an astrological turn date on Thanksgiving which may come to pass. SPX 120-min chart: Link

Jane Fox : 11/20/2008 9:48:19 AM

I was reading where Crude traded below $50.00 but my charts showed a low of 50.26. The difference is continuous charts have moved to January and the media seems to be still using December. The volume on the January contract is 51K whereas on the December contract it is 9K.

Jane Fox : 11/20/2008 9:41:47 AM

Crude hit a low of 50.26 overnight. Link

Jane Fox : 11/20/2008 9:40:35 AM

I see Secretary Paulson is slated to speak at 2:00ET today as well.

Jane Fox : 11/20/2008 9:39:56 AM

WE have the Philly Fed Manufacturing Index out at 10:00ET today and the CD Leading Index.

Jane Fox : 11/20/2008 9:34:21 AM

Let the games begin.

Jane Fox : 11/20/2008 9:32:26 AM

I think even the most permabears were caught by this last wave of selling but, this my friends, will have to abate at some point. The further down the markets go the more we can expect out of a rally but at the same time the more violent that rally will be.

One thing we all have to remember is market rules (that which goes down must go up and vice versa) are still valid, maybe buried pretty deep but they are still there and we will get a 20 to 25% rally at some point. The trick is picking when.

Jane Fox : 11/20/2008 9:22:26 AM

The overnight markets broke through their respective previous day lows (which wasn't too hard to do considering they all closed a daily lows) and are now breaking to new ON lows. Under normal circumstance, we would see some sort of dead cat bounce but with these kinds of markets you never know when it is coming or better yet IF is coming. Link

Keene Little : 11/20/2008 9:18:22 AM

We've got a big gap down facing us this morning and the only hope left for the bulls is a drop n pop for a quick reversal back up and create a key reversal day in the process. Otherwise the descending wedge idea that I've been showing will morph into a larger one that calls for a continuation of the decline (not in a straight line) and probably down to at least the SPX 768 level. Continue to exercise caution if you're short as we could see a "rescue" attempt at any time.

Jane Fox : 11/20/2008 9:15:50 AM

NEW YORK (MarketWatch) -- Saudi Arabian investor Prince Alwaleed bin Talal bin Abdulaziz Al Saud said Thursday that he will increase his holdings in Citigroup Inc. back to 5%, adding that he supports the banking giant's management, according to a report by Zawya Dow Jones.

His holdings are currently less than 4%, according to an emailed statement quoted by Zawya Dow Jones.

Citi has raised $50 billion in private capital, in addition to the $25 billion that the U.S. government has provided under the TARP program, the statement said.

Jane Fox : 11/20/2008 9:14:37 AM

WASHINGTON (MarketWatch) -- First-time filings for unemployment benefits shot up to their highest level since July 1992 last week, rising to a seasonally adjusted 542,000 to punctuate the struggling state of the U.S. labor market, government data showed Thursday.

Initial claims for state unemployment benefits rose by 27,000 to stand at 542,000 in the week ended Nov. 15, the Labor Department reported. The number was much higher than the 503,000 that had been expected by economists.

Jeff Bailey : 11/20/2008 1:44:27 AM

YM off 107 at 7,920

Jeff Bailey : 11/20/2008 1:44:09 AM

YM Pivot Matrix regular session derived Link

Don't see it with the "extended" session (11:25:03 PM). Remember! Futures are a derivative. They were designed to HEDGE risk (DIA, or basket of 30). INDU and DIA closed for trade, and that's what gets hedged LARGELY during the REGULAR session.

When you slap on your DAILY pivot retracement, you'll actually see a "4th" correlation (7,839) at DAILY 19.1%.

Jeff Bailey : 11/20/2008 12:49:25 AM

YM off 93 at 7,934

Jeff Bailey : 11/20/2008 12:16:40 AM

Based on today's EIA inventory release and USO/cl08z so near their bearish vertical counts, I would suggest NOT rolling short positions.

USO $0.50 box to match futures Link

cl08z from 11/12/08 Wrap Link

Into tomorrow's (Thursday's) termination, cl08z settled $53.62.

Keene Little : 11/19/2008 11:25:03 PM

Thursday's pivot table: Link

Well we got the one more leg down and then some. SPX reached down into the Fib target zone of 804-815. Now the big question is whether the decline is going to stop or not. SPX stopped at a good spot for a turnaround on Thursday--it landed right on its trend line along the lows from October 16th (the bottom of a potential descending wedge pattern for the 5th wave) and did a small throw-under below a potential small descending wedge for the move down from Monday, November 17th. SPX 120-min chart: Link

It's a very good setup for a rally on Thursday. Now all the bulls have to do is start some buying. There is one more Fib projection of interest, at 800, so we could see a quick jab down Thursday morning followed by the reversal. Much lower than that and of course the October 2002 level of 768 will be like a siren call. The bullish divergences at Wednesday's new low, and as shown on the daily chart, suggest bears need to be careful pressing this lower. Daily chart: Link

The NDX daily chart looks very similar to SPX where it should be ready for at least a bounce back up before turning back down into a December low (pink) or start the bigger bounce into early next year (dark red): Link

The bottom of its wedge pattern is slightly lower near 1070 (about 17 points lower) but notice where it closed--1087.60. A projection for where the 5th wave is equal to the 1st wave, for the move down from May, is shown on the chart at 1087.90. It's a perfect spot for a turnaround on Thursday but again, proof will be in the pudding and we'll have to see what the market decides to do.

Jeff Bailey : 11/19/2008 10:15:29 PM

Closing U.S. Market Watch Link

OI Technical Staff : 11/19/2008 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.

Market Monitor Archives