Option Investor
Archive
HAVING TROUBLE PRINTING?
Printer friendly version
Jeff Bailey : 1/20/2009 8:31:40 PM

Current OPEN MM Profiles that I've made at this Link

Swing traded long a 1/8 position in the 200-x ProShares Ultra Financial (UYG) at $3.33. Was stopped at $3.04.

Jeff Bailey : 1/20/2009 5:57:00 PM

Suncor Energy (SU) $17.49 -20.57% ... Earnings Press Release (this morning) ... Link

Jeff Bailey : 1/20/2009 5:53:57 PM

Dow Transportation Avg. (TRAN) 2,959.40 -5.97% ... nearing 11/21/08 low of 2,909.

Jeff Bailey : 1/20/2009 5:52:11 PM

CSX Corp. (CSX) $27.88 -6.53% ... $27.25 extended on headline numbers.

Earnings Press Release Link

Jeff Bailey : 1/20/2009 5:49:14 PM

Bank of New York (BK) ... Earnings Press Release Link

Jeff Bailey : 1/20/2009 5:48:07 PM

Bank of New York (BK) $19.00 -17.24% ... slips to $18.39 on headline earnings.

Jeff Bailey : 1/20/2009 5:35:13 PM

Average Retail Gasoline Price Heat Map at this Link

Jeff Bailey : 1/20/2009 5:18:17 PM

Closing Internals found at this Link

Jeff Bailey : 1/20/2009 4:53:03 PM

Closing U.S. Market Watch found at this Link

Financials hammered again today and paced broader market declines.

New 52-week lows are XLF, BIX.X, BKX.X, FXB and UNG

Jeff Bailey : 1/20/2009 4:29:25 PM

Citigroup (C) $2.80 -20.00% ... with dividend now at $0.01/share per quarter, SEC YIELD at $2.80 close would be 1.428%.

Jeff Bailey : 1/20/2009 4:17:40 PM

Citigroup (C) $2.80 -20.00% ... pops to $2.90 extended.

Jeff Bailey : 1/20/2009 4:17:06 PM

Citigroup (C) $2.80 -20.00% ... cuts dividend to $0.01/share.

Jeff Bailey : 1/20/2009 4:15:19 PM

IBM's Earnings Press Release Link

Consensus was for EPS of $3.04 on Revenue of $28.29 billion.

Jeff Bailey : 1/20/2009 4:13:35 PM

International Business Machines (IBM) $83.35 -1.84% ... ticks lower at $83.00 on headline numbers.

Keene Little : 1/20/2009 4:01:04 PM

I haven't talked much about the possibility for a stronger bounce into February before heading lower into March (the most bullish thing I've been showing on daily charts is for a bounce back up to a lower high inside a large sideways triangle pattern). But amazing things can happen in this market when hope takes hold and hope for a successful test of the November lows could bring out the buyers en masse. It's something to consider if you're holding a short position for a longer-term trade (or an OTM bear call spread).

Using the TRAN as an example, it has now come close to testing its November low. If it holds and we start to rally again, there is the potential to rally back up to 4134 where the 2nd leg of an A-B-C bounce pattern from November would achieve 162% of the 1st leg up. That would put it back at price level support/resistance and the November 4th high. That kind of move would certainly startle a few bears, shake them out and then the market would be ready to freefall into a March low. TRAN daily chart: Link

Jeff Bailey : 1/20/2009 3:54:20 PM

Now Terminated Feb Crude Oil (cl09g) daily intervals Link

Keene Little : 1/20/2009 3:47:32 PM

Banks are just getting crushed today--BIX down -20%.

Jane Fox : 1/20/2009 3:45:52 PM

SAN FRANCISCO (MarketWatch) -- Sen. Ted Kennedy, D-Mass., collapsed at an inauguration lunch honoring President Barack Obama, according to media reports Tuesday. Obama said during his speech at the lunch that his prayers are with Sen. Kennedy and his family. Other media reports said that both Kennedy and Sen. Robert Byrd, D-W.Va., were taken from the luncheon because of health problems.

Jane Fox : 1/20/2009 3:44:24 PM

The SPX has made a low of 806 so far today breaking the support at 815.

Jeff Bailey : 1/20/2009 3:38:03 PM

VIX and SPX daily interval montage Link

Jane Fox : 1/20/2009 3:28:07 PM

DOW is now down -316 and the internals are just getting worse and worse. Buyers totally abdicated today.

Jeff Bailey : 1/20/2009 3:26:30 PM

February Crude Oil futures (cl09g) terminate at $38.74, $+2.23, or +6.11%.

March Crude Oil futures (cl09h) settle down $1.73, or -4.06% at $40.84.

Jeff Bailey : 1/20/2009 3:21:47 PM

VIX.X alert! 56.15 +21.77% ... (see Thursday evening/Friday morning's MM)

Jeff Bailey : 1/20/2009 3:20:10 PM

Majors should go out at/near lows of the session.

Jeff Bailey : 1/20/2009 3:19:56 PM

NASDAQ a/d 433/2,332

Jeff Bailey : 1/20/2009 3:19:42 PM

NYSE a/d 267/2,643

Keene Little : 1/20/2009 3:17:21 PM

The other level of interest, which it just hit, is at 810.04 which is the 162% projection for the 2nd leg down for the decline from Friday morning.

Keene Little : 1/20/2009 3:15:07 PM

With the break of last Thursday's low I'm looking for other potential support levels (mainly because the pattern of the decline doesn't inspire bearishness in me). A 127% projection of the previous rally leg (Thursday's low to Friday's high) is at SPX 805.86. The 127% projection of a previous move, sometimes 138% (801.34), will often be a reversal level.

Jane Fox : 1/20/2009 3:13:03 PM

First report was only Kennedy then - no it was not Kennedy - now it is Kennedy and Byrd.

Jane Fox : 1/20/2009 3:12:32 PM

Senators Kennedy and Byrd taken from Obama's Luncheon on stretchers.

Jeff Bailey : 1/20/2009 3:11:59 PM

YM 7,935 ... gives up WKLY S1 (7,943)

Jeff Bailey : 1/20/2009 3:06:39 PM

Citigroup (C) $2.90 -17.14% ... cracks $3.00 strike.

Jeff Bailey : 1/20/2009 3:04:42 PM

NASDAQ a/d 463/2,300

Jeff Bailey : 1/20/2009 3:04:29 PM

NYSE a/d 327/2,575

Keene Little : 1/20/2009 3:02:42 PM

This afternoon's decline looks a bit like a mirror version of Friday afternoon's rally. That rally didn't hold and I'm still thinking this decline won't hold. But just as you couldn't short Friday's rally it seems you can't buy this afternoon's decline. Tomorrow may be a different story and I don't think it would be wise to take a short home with you tonight. At least hedge it if you're short.

Jeff Bailey : 1/20/2009 3:02:15 PM

YM 5-minute interval chart Link

Jeff Bailey : 1/20/2009 2:56:59 PM

Weekly S1 ... All equity-based tracked in Pivot Matrix except for INDU/DIA have seen trade at WKLY S1.

Jeff Bailey : 1/20/2009 2:47:16 PM

XLF $8.48 -12.39% ...

Jeff Bailey : 1/20/2009 2:46:54 PM

Swing trade stopped alert! for the 1/8 position in the ProShares Ultra Financial (UYG) at $3.04.

Keene Little : 1/20/2009 2:45:19 PM

The pullback today was a little deeper than I thought it would go but it continues to fit as just a pullback within a larger bounce pattern off last Thursday's low. If it can start back up from here there is a Fib projection for the next leg up at 880.75 where the 2nd leg up would achieve 162% of the 1st leg up (typical for an expanded flat correction which is what it appears to be so far). This would also be a 62% retracement of the decline from the January high. SPX 60-min chart: Link

First it would have to get through 855.36 where the bounce would have two equal legs for the bounce. I don't show it on the chart but a continuation lower from here would likely mean a quick drop down to retest the October 2002 low at 768 if not the November low at 741.

Keene Little : 1/20/2009 2:27:52 PM

Well, that's as far as the bulls can let this drop without the downside pattern turning a lot more bearish.

Jeff Bailey : 1/20/2009 2:23:31 PM

UYG $3.08 x $3.09 ....

Jeff Bailey : 1/20/2009 2:23:00 PM

BIX.X 79.61 -16.30% ...

Jeff Bailey : 1/20/2009 2:22:35 PM

RUT.X 443.69 -4.87% ... probes QUARTERLY 38.2%. Did this on Thursday. MONTHLY S1 442.54.

Jane Fox : 1/20/2009 2:21:22 PM

The internals are telling us the buyers have left the building. Not sure when they will return either. Link

Jeff Bailey : 1/20/2009 2:17:12 PM

02:00 Internals at this Link

Jane Fox : 1/20/2009 2:10:33 PM

Here are charts of some other ETFs so can compare them as well. Obviously the XLF is the weakest of the bunch. Link

Jane Fox : 1/20/2009 2:03:29 PM

Here are the daily charts of the four major markets we watch here in the monitor. I have marked the December 8th high (red trendline) on each so we can see which ones are making higher highs and lows and which ones aren't. The DOW is the weaker of all four.

However according to Fibonacci they are pretty similar. Link

Keene Little : 1/20/2009 1:56:30 PM

The way the downside pattern is playing out it's looking like we could get a retest of last Thursday's low (SPX 817) but it shouldn't break. A break much below 815 would turn the pattern bearish.

Jane Fox : 1/20/2009 1:54:56 PM

Here are your overnight charts. If we get any kind of rally (internals are telling "forget about it") the overnight lows will certainly be resistance. Link

Keene Little : 1/20/2009 1:44:57 PM

The choppy declining pattern today continues to look like an ending pattern and I'm expecting a bullish resolution out of this.

Jane Fox : 1/20/2009 1:43:48 PM

Once the SPX broke support at 850 it quickly fell to support at 815. It then bounced back to 850 to find that 850 had now become resistance so back down to retest 815. A close below 815 is a clear sign the next stop (support) may be last year's lows. Link

Jeff Bailey : 1/20/2009 1:40:43 PM

UYG $3.19 -16.92% ...

Jeff Bailey : 1/20/2009 1:40:08 PM

XLF $8.68 -10.33% ... has traded its 11/21/08 low of $8.67.

Jeff Bailey : 1/20/2009 1:38:56 PM

I'm not seeing any sign of a post-Inauguration bounce at this point.

Jeff Bailey : 1/20/2009 1:23:50 PM

dj- BANK OF CANADA CUTS RATE 50BPS TO 1%

Canada's central bank reduces its key policy rate to the lowest on record and signals it is prepared to cut further to combat a recession that will cause the economy to contract this year for the first time since 1991 as domestic demand shrinks and exports decline.

Jeff Bailey : 1/20/2009 1:23:19 PM

dj- FOREST LABS NET DOWN 37% ON LICENSING CHARGE

Forest Laboratories' fiscal 3Q net falls to $188 million, or 62c a share, on a product-licensing charge as the company raises its fiscal-year view by 5c a share to reflect reduced research-and-development spending.

FRX $26.19 +1.66% ...

Jeff Bailey : 1/20/2009 1:21:45 PM

dj- JOHNSON & JOHNSON NET UP 14%

Health products giant posts 14% rise in 4Q net income to $2.71 billion, or 97c a share, as cost cuts and one-time gains help offset sales decline but gives a 2009 outlook below Wall Street's estimates.

JNJ $57.50 +0.10% ...

Jeff Bailey : 1/20/2009 1:20:57 PM

dj- STATE STREET NET TUMBLES 71% ON CHARGES

Boston asset manager's 4Q net falls to $65 million, or 15c a share, after it takes steps to shore up some funds and absorbs restructuring charges. Excluding items, earnings are $1.18 a share, topping estimates of $1.14. Bank expects flat results for all of 2009. Shares drop 49%.

STT $18.43 -49.29%

Jeff Bailey : 1/20/2009 1:17:48 PM

UGA $21.50 -3.10% ... just about "even" with 01/15/09 1/2 position short entry ($21.52)

Jeff Bailey : 1/20/2009 1:16:20 PM

VIX.X 52.59 +14.05% ...

Jeff Bailey : 1/20/2009 1:15:49 PM

PBR $23.79 -4.80% ...

PBR-PK $3.00 x $3.30

Jeff Bailey : 1/20/2009 1:14:29 PM

US Oil Fund (USO) $28.97 -2.98% ... probes morning low.

Jeff Bailey : 1/20/2009 1:06:50 PM

01:01 PM Market Watch found at this Link

Jeff Bailey : 1/20/2009 12:57:49 PM

10-year Treasury Yield ($TNX.X) +14.1 bp at 2.445% and now just back under WKLY R1.

Keene Little : 1/20/2009 12:56:40 PM

The move down today is looking somewhat like a descending wedge pattern which calls for one more minor new low to finish it. If the bullish divergences continue then once again it will be a good setup for a long play.

Jeff Bailey : 1/20/2009 12:56:05 PM

dj- Mexico Interest Rates Fall In Weekly Auction After Rate Cut

Yields fell across the board Tuesday in a Bank of Mexico primary auction of government securities after the bank cut interest rates last Friday to shield Mexico from the U.S. recession. The yield on benchmark 28-day Treasury bills, or Cetes, fell 0.26 percentage point to 7.44%, while yields on longer maturities fell even more. On Friday the Bank of Mexico cut the key overnight interest rate for the first time in three years in an attempt to stem the slide in the domestic economy. Mexico's economy has slowed in recent months due to a deepening recession in the U.S., which buys about 80% of Mexico's exports, and probably contracted in the fourth quarter, according to the Bank of Mexico. The yield on 91-day Cetes fell 0.42 percentage point to 7.40%, while the yield on 175-day Cetes fell 0.27 percentage point to 7.18%.

Jeff Bailey : 1/20/2009 12:52:32 PM

NASDAQ a/d 562/2,107

Jeff Bailey : 1/20/2009 12:52:20 PM

NYSE a/d 404/2,459

Jane Fox : 1/20/2009 12:43:22 PM

Even though we had the S&P build a bullish reverse head and shoulders it didn't pan out and a bullish pattern that fails is usually quite bearish. Sure enough the S&P made a new daily low. By the way, the Internals are still bearish Link

Keene Little : 1/20/2009 12:37:46 PM

Bullish divergences continue at the new lows and therefore it's looking more like a bottoming process rather than a breakdown.

Keene Little : 1/20/2009 12:30:42 PM

Obama finished his speech and the market is selling off. I guess traders are back at their monitors and decided to sell rather than buy.

Jeff Bailey : 1/20/2009 12:29:58 PM

NYSE Most Actives ...
BAC $5.77 -19.64%, C $3.14 -10.29%, WFC $16.28 -12.85%, JPM $19.87 -12.93%, STT $18.98 -47.79%, GE $13.21 -5.22%, F $2.08 -5.02%, PFE $17.55 +0.29%, USB $17.45 -4.75%, BK $16.71 -27.22%

Jeff Bailey : 1/20/2009 12:23:46 PM

Current OPEN MM Profiles that I've made at this Link

Short 1/2 position UGA @ $21.52.
Long 1 PBR-PK @ $4.00.
Long 1/8 position UYG @ $3.33

Jeff Bailey : 1/20/2009 12:14:03 PM

12:00 Internals at this Link

Jane Fox : 1/20/2009 12:11:36 PM

President-elect Obama becomes President Obama.

Jeff Bailey : 1/20/2009 12:10:43 PM

President Obama takes office.

Jeff Bailey : 1/20/2009 11:45:46 AM

HUI.X +3.85% ...
DRG.X +0.08% ... sector winners.

Jeff Bailey : 1/20/2009 11:45:22 AM

XLF $8.89 -8.16% ...
BIX.X 84.74 -10.91% ...
BKX.X 27.95 -11.43%
XBD.X 68.76 -4.43%
XBD.X 68.76 -4.43%
IUX.X 127.23 -1.97%

Jeff Bailey : 1/20/2009 11:43:54 AM

UYG $3.33 -13.28% ...

Jeff Bailey : 1/20/2009 11:43:30 AM

Swing trade long alert! ... for 1/8 position in the ProShares Ultra Financials (UYG) at the offer of $3.33.

Stop goes $3.04. Target a bounce to $4.15.

Keene Little : 1/20/2009 11:40:54 AM

At this point it's looking like the test of this morning's low is going to hold. If testing the long side have your stop at a new daily low.

Jeff Bailey : 1/20/2009 11:38:16 AM

CYC.X 430.30 -4.67% ... once again challenges "left shoulder" of h/s bottom pattern.

Jeff Bailey : 1/20/2009 11:36:57 AM

NASDAQ a/d 535/2,062

Jeff Bailey : 1/20/2009 11:36:45 AM

NYSE a/d 387/2,429

Jeff Bailey : 1/20/2009 11:35:03 AM

11:30 AM Market Watch at this Link

Jeff Bailey : 1/20/2009 11:32:35 AM

BKX.X 27.47 -12.95% ... nearing "bearish support" (DOWNWARD trend taken from 07/15/08 low 46.52, to 11/21/08 low 32.96) and extension of that trend ~27.00.

Keene Little : 1/20/2009 11:23:32 AM

Price action has been rather slow and I wonder if it's because many traders are watching the inauguration.

Jeff Bailey : 1/20/2009 11:22:29 AM

Berkshire Hathaway (BRK.A) $87,000.00 -4.03% ... Slips back under 19.1% convention (12/11/07 high to recent 11/20/08 low).

Jeff Bailey : 1/20/2009 11:11:31 AM

Could get a decent bounce from broader equities this afternoon if Inauguration event passes without a glitch.

Jeff Bailey : 1/20/2009 11:04:48 AM

dj- Homeland Security Probe (update) ... U.S. intelligence forces were Tuesday probing information about a "potential threat on inauguration day," but Homeland Security officials said they were uncertain about its credibility.

"The FBI, the Department of Homeland Security (including the U.S. Secret Service) and the intelligence community are coordinating with other law enforcement authorities to investigate and analyze recently received information about a potential threat on inauguration day," Homeland Security spokesman Russ Knocke said.

But he added as Barack Obama prepared to be sworn in as the nation's 44th president: "This information is of limited specificity and uncertain credibility."

Keene Little : 1/20/2009 11:01:21 AM

So far the pullback from this morning's bounce could fit as the 5th wave down for the decline from Friday afternoon. If we see bullish divergences with a test of this morning's low it should be a good opportunity to get long the market. But obviously we need to see the low hold.

Jeff Bailey : 1/20/2009 11:00:45 AM

dj- Homeland Security: Probing possible Inauguration Day threat

Jeff Bailey : 1/20/2009 10:59:18 AM

SPX 829.53 -2.42% ...

Jeff Bailey : 1/20/2009 10:58:56 AM

dj- President Bush leaves White House for last time as President

Jeff Bailey : 1/20/2009 10:57:44 AM

HSBC Holdings (HBC) $33.86 -15.26% ... notably weak.

Jeff Bailey : 1/20/2009 10:56:29 AM

FXE $129.28 -2.80% ... euro weak and gaps below Thursday's "doji" day.
FXY $110.49 +0.54% ...
FXB $139.59 -5.40% ... hit hard and new 52-week low against the greenback.

Jeff Bailey : 1/20/2009 10:53:58 AM

dj- Eurosystem Gold Reserves ... The Eurosystem's reserves of gold and gold receivables fell by EUR26 million to EUR218.366 billion in the week ended Jan. 16, the European Central Bank said Tuesday.

Jeff Bailey : 1/20/2009 10:52:23 AM

dj- French Budget Minister: Govt. Disagrees With EU's Latest Forecast For France
If GDP contracts, will let automatic stabilizers play
Does not plan to hike taxation, social charges

Jeff Bailey : 1/20/2009 10:46:51 AM

Petroleo Brasileiro (PBR) $23.96 -4.12% ... PBR-PK $3.00 x $3.30

Jeff Bailey : 1/20/2009 10:43:51 AM

US Gasoline Fund (UGA) $22.05 -0.63% ... also off opening lows of $21.10

Jeff Bailey : 1/20/2009 10:42:42 AM

US Oil Fund (USO) $30.38 +1.74% ... reversing earlier losses.

Jeff Bailey : 1/20/2009 10:39:17 AM

European Markets Link ... trade mixed-to-lower with $FTSE up 0.16% at 4,115. Germany's $DAX off 0.56% at 4,292, while France's CAC-40 is lower by 1.39% at 2,948.

Jeff Bailey : 1/20/2009 10:37:25 AM

Asian Markets Link ... finished Tuesday's trade mostly lower. $NIKK was off 2.31% at 8,066. $HSI lower by 2.85% at 12,960, while $SSEC finished up 0.37% at 1,994.

Keene Little : 1/20/2009 10:26:48 AM

The upside target for SPX at 865.51 is also right on top of the 38% retracement of the decline from the January high (865.48). I was hoping for a higher bounce--at least up to 880 if not 895 but at this point I'm thinking that's not in the cards. But first we need to see if the bulls can step back into the game here and drive this back up.

Jeff Bailey : 1/20/2009 10:22:25 AM

10:00 Internals found at this Link

Note(s): I'm not getting NH/NL feed for NYSE. It would currently take a <=18.00% CLOSING measure for the NASDAQ's 10-day NH/NL ratio to see a 3-box reversal back lower.

Jane Fox : 1/20/2009 10:21:12 AM

The S&P futures did break the neckline but then immediately failed. I see the VIX did not break its neckline.

Keene Little : 1/20/2009 10:18:58 AM

Getting a bounce off the 827 level (little throw-under) so if that now holds and we start rallying again (by no means a given) the initial upside target would be SPX 865.51 for two equal legs up from Thursday's low. I do see the possibility for at least one more minor new low (no lower than 820) to create a 5-wave move down from Friday afternoon's high. If we get that move watch for bullish divergence against this morning's low for a setup to at least test the long side.

Jane Fox : 1/20/2009 10:18:46 AM

ES cannot break the neckline but is giving it another try. I would sure like to see the VIX break the neckline of its opposing head and shoulders pattern to confirm "IF" ES does happen to make a break for it.

Jeff Bailey : 1/20/2009 10:17:36 AM

Volume heavy at the big board with just over 1 billion traded.

Jane Fox : 1/20/2009 10:16:13 AM

The S&P futures (ES) have made a very nice little reverse head and shoulders and is now trying to break through its neckline. Link

Jane Fox : 1/20/2009 10:16:31 AM

Internals are telling you the bears are in control and unless you are very good at fading I would not try the long side until the bull's show a little more strength. Link

Jane Fox : 1/20/2009 10:12:56 AM

Crude is doing its traffic light impression, red then green then red then green.

Jeff Bailey : 1/20/2009 10:09:37 AM

Dollar index and gold both bidding this morning ... rather "defensive" look to it.

Keene Little : 1/20/2009 10:08:46 AM

Keeping an eye on the semis shows a bearish move today after the SOX reached up and gave its broken uptrend line from November a kiss goodbye with Friday's retest. SOX daily chart: Link

Jane Fox : 1/20/2009 10:03:02 AM

Crude's low overnight was 39.11. Link

Jane Fox : 1/20/2009 10:00:57 AM

SPX has now broken its previous day low, at 830.66

Jeff Bailey : 1/20/2009 9:51:50 AM

Reminder! Nymex Feb'09 Crude Oil futures (cl09g) terminates at today's settlement.

Keene Little : 1/20/2009 9:51:06 AM

After taking out Friday's low (pretty much a given at this point), watch SPX 827 for potential support (two equal legs down from Friday morning).

Jane Fox : 1/20/2009 9:44:09 AM

TRIN is bearsih 1.35, anoth notch for the bears.

Jeff Bailey : 1/20/2009 9:44:08 AM

Financials remain under pressure here this morning ...

XLF $8.90 -8.05%
BIX.X 85.14 -10.49%
BKX 27.89 -11.62%
XBD.X 68.96 -4.15%
IUX.X 127.56 -1.71%

Jane Fox : 1/20/2009 9:42:53 AM

AD line is a bearish -1335 but the VIX has not make a bearish gap up, it opened in its previous day range.

Keene Little : 1/20/2009 9:41:49 AM

So far SPX has retraced just shy of 62% of Friday afternoon's rally (839.76). If this level holds we could see a reversal and start rallying again. Much below 835 and I'd say we're going to take out Friday's low.

Jeff Bailey : 1/20/2009 9:33:43 AM

Weekly, Monthly, Quarterly Index Pivot Matrix at this Link

Jane Fox : 1/20/2009 9:31:35 AM

LONDON (MarketWatch) -- Fiat is going to take a 35% equity interest in Chrysler, the companies and Chrysler's owner Cerberus Capital Management said Tuesday in a tentative agreement that needs U.S. Treasury approval. Chrysler will get "access to competitive, fuel-efficient vehicle platforms, powertrain, and components" to be produced at Chrysler manufacturing sites. Fiat would also provide distribution capabilities in key growth markets, as well as substantial cost savings opportunities, the companies said. In addition, Fiat would provide management services supporting Chrysler's submission of a viability plan to the U.S. Treasury as required. The alliance does not contemplate that Fiat would make a cash investment in Chrysler or commit to funding Chrysler in the future, the companies said.

Jane Fox : 1/20/2009 9:29:24 AM

Over the weekend I was looking at some charts and noticed the chart of the OEX (S&P 100) was much weaker than the S&P. The high made on January 6th was not a higher high but equal to the December 8th high (thus a double top) whereas the S&Ps January 6th high was higher than its December 8th high. Link

The OEX was created by the Chicago Board Options Exchange (CBOE) and originally represented the top 100 stocks that traded on the CBOE in 1983 so it will usually be a list of the larger S&P stocks. If you take a look at the DOW you will see that the OEX does indeed look a lot more like the larger cap granddaddy, the DOW, Link than it does its brethren, the S&P 500. Link

Keene Little : 1/20/2009 9:27:22 AM

There was a recovery attempt during overnight hours but equity futures are still down. The direction for this morning is a toss-up. I see the possibility for a gap down opening to get reversed and head higher again, taking out Friday's highs. But unfortunately I also see the possibility for a decline to below the overnight lows (about 5 ES points lower than currently trading as we near the open). I'll be waiting to see how the first hour goes.

Jane Fox : 1/20/2009 9:13:00 AM

Overnight charts are telling us there was not a lot of interest in trading overnight. With all the events happening in DC today I wouldn't be surprised to see a very quiet intraday session as well. Link

Jane Fox : 1/20/2009 9:08:48 AM

Good Morning all. Whether you are a Barack Obama supporter or not, I think you would all agree, Martin Luther King Jr. would be very very proud today.

Keene Little : 1/19/2009 11:16:53 PM

Tuesday's pivot table Link

The rally on Friday afternoon looked like it was going to fail at any time but instead kept getting lifted just enough to keep the sellers at bay. Whether the light-volume rally will hold on Tuesday is anyone's guess (Monday's futures are down). But regardless of whether we see a pullback first I think the correction of the decline from January 6th would look better with a little more time and price retracement before it should be ready to tip back over and head for new monthly lows.

If we see a pullback first watch to see if the broken downtrend line from January 6th holds, currently near SPX 832 (SPX closed near 850 so that would be a healthy drop). Two equal legs down from Friday morning's high would be at 827. As shown in pink on the 60-min chart, I'm looking for a larger bounce pattern into Wednesday: Link

As shown in dark red we could see the rally off Friday's mid-day low continue without much of a pullback so we'll have to see how the market behaves early Tuesday morning. The pattern looks very similar for NDX: Link

The SPX daily chart keeps these moves in perspective and shows how we are either in a leg down that will find support at or above 768 as part of a large sideways triangle consolidation (dark red) or is more immediately bearish and pointing to new lows below November's sometime in February (pink). Link

Another way to look at where we've been and where I think we're going is to look at a weekly line chart of SPX. Using the EW count off the closing prices, and creating a parallel down-channel off the closing prices and EW count, shows a Fib projection to 660 for the end of the 5th wave if we've started down from the January high: Link

I'm showing the 660 projection intersecting the mid line of the down-channel at the end of March which fits some cycle studies for a turn window. The interesting thing about the 660 projection is that it aligns with the 661 level off the Gann Square of Nine chart (squares to the October 2002 low at 768 and the October 2007 high at 1576. I'm obviously jumping way ahead of myself here but it's something I'll be watching and updating along the way.

OI Technical Staff : 1/19/2009 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