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Jeff Bailey : 1/23/2009 9:44:37 PM

And yg09g finishes .... 900.00 on the button. Termination of Feb gold is Sunday! Link

Jeff Bailey : 1/23/2009 9:39:58 PM

Today's Global economic calendar Link

04:30 AM was some data out of the UK.

Unusual volume spike at 05:00-05 AM ET in yg09g after spike in PRICE from 858.90 to 867.80 from 04:40-45 AM.

Jeff Bailey : 1/23/2009 5:41:02 PM

Crrazzzy YM trade blotter ... today felt and looked just like 01/15/09 didn't it? YM month-to-day blotter Link

Jeff Bailey : 1/23/2009 4:48:06 PM

SCO finished $29.71 -14.28% ...

Jeff Bailey : 1/23/2009 4:37:08 PM

USO high was $33.00, just 6-cents shy of 12/12/08 termination benchmark.

Some INCREDIBLE intra-day action in commodities above near-term horizontal resistance today.

Jeff Bailey : 1/23/2009 4:34:22 PM

What a day!

Jeff Bailey : 1/23/2009 4:17:22 PM

Not even the VIX.X 47.23 -0.12% could close its WKLY Pivot today.

Keene Little : 1/23/2009 4:14:23 PM

The bounce from this afternoon's low in ES (820.75) had two equal legs up at 831.50 (tagged to the penny) at the same time SPX was tagging (again) it's broken uptrend line from this morning. They didn't make it easy staying short this afternoon but they did offer a couple of opportunities to get short. Now we'll see if we get the move down on Monday morning. I hope everyone has a good weekend.

Jane Fox : 1/23/2009 4:08:33 PM

When you have a nice move overnight it usually means the intraday session will be slow and choppy and sure enough that was the case today. Link

Jeff Bailey : 1/23/2009 4:09:33 PM

RUT.X "Floyd Little's it" 444.44 Link

Jeff Bailey : 1/23/2009 4:07:05 PM

QQQQ $28.90 +0.48% ... WKLY Pivot next week looks to be $28.76.

Keene Little : 1/23/2009 4:05:33 PM

Resistance held and the pattern still supports a down day on Monday. It will need to start down immediately as any rally would stop us out with a new high above today's.

Jeff Bailey : 1/23/2009 4:00:56 PM

RKH $48.82 x $.83

Jeff Bailey : 1/23/2009 4:00:28 PM

YM 8,053 ... comes to D Pivot (regular session derived)

Keene Little : 1/23/2009 3:56:52 PM

SPX is back up to its downtrend line from last Friday, just under 834. Might it get parked there for the weekend, leaving both sides guessing for Monday?

Jeff Bailey : 1/23/2009 3:55:05 PM

RKH .57 x .61

Jeff Bailey : 1/23/2009 3:54:46 PM

YM long target alert! 8,048

Jeff Bailey : 1/23/2009 3:54:27 PM

YM long raise stop alert! to 8,039

Jeff Bailey : 1/23/2009 3:53:34 PM

They're doing their best to hold things back ....

Jeff Bailey : 1/23/2009 3:53:15 PM

YM long raise stop alert! to 8,009

YM 8,027

Keene Little : 1/23/2009 3:48:34 PM

Big effort to hold the market up into the close but the bounce from the pullback low looks like a correction. Short against today's high remains the recommendation as I think we'll see a down day on Monday. Just don't let it run higher against your stop.

Jeff Bailey : 1/23/2009 3:44:09 PM

Should get our target ...

Jeff Bailey : 1/23/2009 3:43:56 PM

YM 8,028

Jeff Bailey : 1/23/2009 3:43:44 PM

RKH $48.59

Jeff Bailey : 1/23/2009 3:41:18 PM

YM long raise stop alert! ... to 8,005.

YM 8,021

Jeff Bailey : 1/23/2009 3:39:26 PM

YM long raise stop alert! to even.

YM 8,014

Jeff Bailey : 1/23/2009 3:36:33 PM

YM long ... stop goes 7,980. Target is 8,048

Jeff Bailey : 1/23/2009 3:35:58 PM

YM long alert! 7,992 ...

Jeff Bailey : 1/23/2009 3:34:16 PM

RKH $48.10

Jeff Bailey : 1/23/2009 3:33:52 PM

close at 8,038, but not "close enough"

Jeff Bailey : 1/23/2009 3:33:31 PM

YM long stop alert! ... 7,991

Keene Little : 1/23/2009 3:31:23 PM

SPX just tagged its broken uptrend line from this morning. That's another good setup for a short play to see if we get the kiss goodbye.

Jeff Bailey : 1/23/2009 3:27:06 PM

YM long raise stop alert! ... to even

YM 8,030

Jeff Bailey : 1/23/2009 3:25:23 PM

YM long ... stop will go 7,980. Target is 8,048

Jeff Bailey : 1/23/2009 3:24:19 PM

YM Long alert! here at 7,991

Keene Little : 1/23/2009 3:08:11 PM

A retest of the broken uptrend line from this morning's low would be near SPX 832.50.

Jeff Bailey : 1/23/2009 3:03:54 PM

Yet COMPX +0.55% ... BEARISH divergence.

Jeff Bailey : 1/23/2009 3:03:34 PM

NASDAQ a/d 1,209/1,517

Jeff Bailey : 1/23/2009 3:03:20 PM

NYSE a/d 1,569/1,230

Jeff Bailey : 1/23/2009 2:59:54 PM

Volume in the RKH drying up faster than a raindrop in the desert on a swelerting summer's day.

Jeff Bailey : 1/23/2009 2:56:56 PM

RKH 47.94 ... 19.1% dynamic

Jeff Bailey : 1/23/2009 2:56:15 PM

YM 7,994

Jeff Bailey : 1/23/2009 2:55:24 PM

RHK 48.34

Jeff Bailey : 1/23/2009 2:52:47 PM

RHK $48.57 ... start the test again ....

Jeff Bailey : 1/23/2009 2:49:23 PM

YM and RKH 10-minute intervals, pink is "dynamic" Link

Jeff Bailey : 1/23/2009 2:45:03 PM

RKH 48.42 on the second 10-minute try. Still can't do it for two (2) intervals.

Keene Little : 1/23/2009 2:38:37 PM

And there's the break (down). Short against today's high is the recommended play.

Keene Little : 1/23/2009 2:33:45 PM

It's getting tight now--a break above SPX 840 or below 830 should see some follow through. Trade the direction of the break.

Jeff Bailey : 1/23/2009 2:30:12 PM

I say we go ...

Jeff Bailey : 1/23/2009 2:29:24 PM

QQQQ $29.29 ... not a bank in the bunch.

Many "smaller" banks in the RUT.X/IWM

Jeff Bailey : 1/23/2009 2:28:43 PM

IWM $44.85

Jeff Bailey : 1/23/2009 2:28:26 PM

BIX.X 81.28

Jeff Bailey : 1/23/2009 2:27:22 PM

RKH 48.55 +4.02% ... Alert! ... begin 10 and 20-minute test.

Jeff Bailey : 1/23/2009 2:24:11 PM

IBM $89.98 -0.09% ...

Jane Fox : 1/23/2009 2:24:10 PM

Crude is up $3.00 so far today. Link

Jeff Bailey : 1/23/2009 2:23:38 PM

That would be "psycho" 800 Jane!

Jane Fox : 1/23/2009 2:23:29 PM

$RUT.x, $SPX.s, $NDX.x are all green but the $INDU is still red.

Jeff Bailey : 1/23/2009 2:22:43 PM

RUT.X 446.60 ... also started week out above WKLY Pivot. Hasn't seen it since first 10-minute of Tuesday's trade.

Jane Fox : 1/23/2009 2:21:47 PM

After all the talking technicians have done (me included) about where SPX's support is it turns out to as simple at the century mark., 800. Link

Jeff Bailey : 1/23/2009 2:21:29 PM

These three began the week above the WKLY Pivot though, so a little stronger to begin with.

Jeff Bailey : 1/23/2009 2:20:53 PM

QQQQ high of $29.35. NDX.X high of 1,192.64 would have been briefly.

Keene Little : 1/23/2009 2:20:26 PM

Next test is the uptrend line from this morning--SPX 830.

Jeff Bailey : 1/23/2009 2:19:56 PM

Quick check had SMH $17.19 at WKLY Pivot. All other equity-based in pivot matrix still below.

Jane Fox : 1/23/2009 2:17:43 PM

This is the bulls making a stand - and winning. Link

Keene Little : 1/23/2009 2:17:36 PM

By dropping back below 834 SPX just gave us a throw-over sell signal. It now must continue its decline from here. Any new daily high would suggest a rally into the close and open up the possibility for at least a move up to 870.

Jeff Bailey : 1/23/2009 2:15:13 PM

02:00 Internals found at this Link

Jeff Bailey : 1/23/2009 2:09:52 PM

XLF $8.96 +2.98% ... with XBD.X 72.57 +3.49%

Jeff Bailey : 1/23/2009 2:09:21 PM

RKH $48.19 +3.29% ...

Jeff Bailey : 1/23/2009 2:09:06 PM

BIX.X 80.62

Jeff Bailey : 1/23/2009 2:08:54 PM

SPX 835.18 +0.92% ... after tap of M S1 from underneath.

Keene Little : 1/23/2009 2:06:56 PM

I'm not seeing much in the way of bearish divergences and the break of the downtrend line from last Friday is looking bullish (or could be just a throw-over finish if it drops right back down below 834 now).

Keene Little : 1/23/2009 2:04:01 PM

The bounce in SPX has gone about as far as it can and still be bearish. Above yesterday afternoon's high near 840 would be a bullish statement.

Jeff Bailey : 1/23/2009 2:02:49 PM

INDU 8,128 +0.06% ... inches green. Could improve "psycho" intra-day

Jeff Bailey : 1/23/2009 1:50:01 PM

NASDAQ a/d 1,405/1,287

Jeff Bailey : 1/23/2009 1:49:50 PM

NYSE a/d 1,515/1,235

Jeff Bailey : 1/23/2009 1:49:13 PM

AAPL +1.33%, QCOM +2.82%, MSFT +2.04%, GILD -0.43%, GOOG +6.67% .....

Jeff Bailey : 1/23/2009 1:48:37 PM

QQQQ's "Big 10" positive at 7:3

Jeff Bailey : 1/23/2009 1:47:44 PM

IBM +0.27%, XOM +0.10% and CVX +0.51% green, next 7 still red.

Jeff Bailey : 1/23/2009 1:47:05 PM

About an hour ago when I looked, the "Big 10" were all red.

Jeff Bailey : 1/23/2009 1:45:32 PM

YM 8,037 after trade at DAILY Pivot (regular session derived)

Keene Little : 1/23/2009 1:40:26 PM

Along with the metals today we've got USO blasting to the upside. But I'm not convinced (yet). The start of the bounce off Tuesday's low looks like a corrective wave structure. If so we should see USO fail at or below a correlation of Fibs at 33.42. It takes a big drop back below 29 at this point to say the bounce is over. A rally above 33.50 would say the rally has legs. USO 120-min chart: Link

Jeff Bailey : 1/23/2009 1:33:03 PM

Shoud be Swing trade short stopped alert! ... in the remaining US Gasoline Fund (UGA) $21.90 +7.56% ... at $21.52.

Jeff Bailey : 1/23/2009 1:25:23 PM

UYG $3.12 +2.98% ...

Jeff Bailey : 1/23/2009 1:25:03 PM

RKH $47.93 +2.69% ... KNOW at least one test. (see yesterday's MM)

Jeff Bailey : 1/23/2009 1:24:30 PM

BIX.X alert! 80.15 +1.61% ....

Jeff Bailey : 1/23/2009 1:23:47 PM

EIA Refinery inputs and other data Link

Some inventory (too wide to show all) Link

Jeff Bailey : 1/23/2009 1:22:18 PM

Again ... I (Jeff Bailey) still making some ties with euro and oil.

Keene Little : 1/23/2009 1:22:02 PM

One thing I don't show on the daily gold chart is that two equal legs up for the 2nd a-b-c is at 943.90 so there's good correlation between the Fib projection and the top of the up-channel. The count for the move up from October is a double zigzag with two a-b-c bounces separated by the x-wave pullback into the low in December. It doesn't mean gold will get up the 940 area but that's the upside potential if it can get through 915.

Jeff Bailey : 1/23/2009 1:21:31 PM

FXE $129.45 -0.56% ... off lows of $128

Jeff Bailey : 1/23/2009 1:20:32 PM

Swing trade stopped alert! ... in the ProShares UltraShort Crude (SCO) $30.65

Jane Fox : 1/23/2009 1:19:53 PM

SAN FRANCISCO (MarketWatch) - Intel Corp. (INTC) on Friday said Craig Barrett plans to retire from "active management" and from his post as chairman and member of the chip giant's board in May. Barrett, who served as Intel CEO from 1998 to 2005, will be replaced by independent director Jane Shaw who will become the company's non-executive chairman.

Keene Little : 1/23/2009 1:16:44 PM

With the big pop up in gold today it looks like I can update my daily chart and align the two possible scenarios a little closer now. The downtrend line near 915 looks to be in play and ideally we'll see gold do a little pullback and then head higher again (to give us a 5-wave move up from the 801.50 low on January 15th). Above 915 would likely see gold heading for the top of its parallel up-channel and a retest of the October high near 936. Daily GC chart: Link

Jeff Bailey : 1/23/2009 1:14:19 PM

USO $31.62 +5.32% .... do see some volume on the move above that $31.00 strike. Suggests there may be some NAKED calls getting long the underlying.

Jeff Bailey : 1/23/2009 1:12:21 PM

Clicked through Market Watch and HUI.X looks to be only sector/index above its 150-day SMA.

Jeff Bailey : 1/23/2009 1:09:42 PM

Amex Gold Bugs ($HUI.X) 303.98 +9.04% ... sticks its head above trending lower 150-day SMA.

Jeff Bailey : 1/23/2009 1:08:48 PM

01:03 PM Market Watch at this Link

Jeff Bailey : 1/23/2009 1:05:11 PM

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

Lowered stop in UGA to $21.52.

Added 1/8 position long in CDE at $0.83. (stop $0.63, Target in Comment Field ($1.25).

Jane Fox : 1/23/2009 1:03:58 PM

New York Rep. Kirsten Gillibrand named to U.S. Senate

Jane Fox : 1/23/2009 1:03:47 PM

Gold is up 42.50 and has tagged the $900.00 mark again. One would think that the US dollar would be down but it is not. The inverse relationship between Gold and the greenback has being broken for the last few days. Link

Jane Fox : 1/23/2009 1:00:05 PM

The internals are not telling me much today, which confirms the choppy intraday session we have had so far. I can't see it changing much at any point soon so may be a good day to call it quits early. Link

Keene Little : 1/23/2009 12:56:58 PM

The first potential failure level for SPX is just shy of 830 where the move up from 818 just before 12:00 PM would have two equal legs up.

Jeff Bailey : 1/23/2009 12:56:38 PM

Swing trade short lower stop alert! ... for the remaining short position in the US Gasoline Fund (UGA) $20.63 +1.32% ... to even ($21.52).

Keene Little : 1/23/2009 12:55:27 PM

Keep an eye on SPX 835--if it rolls over from there (assuming it will get there), short it. Any rally above 840 would say the bulls are back in control and the upside target of 870 would be back on the table.

Keene Little : 1/23/2009 12:47:44 PM

Within the sideways triangle pattern shown earlier on the SPX 30 and 60-min charts, today's bounce should be the last leg up to finish the consolidation. The top of the triangle pattern is currently near 835 and the top of a small parallel up-channel for today's bounce crosses that level just before 1:00 PM. An hour later the middle of the channel crosses the top of the triangle near 2:00 PM. So I'm watching to see how this sets up as I think the pattern is bearish. SPX 5-min chart: Link

A break of the uptrend line from this morning (threatening to do so while I type) would be a bearish heads up that the bounce could be over (with the risk that it's just a pullback before another leg up for a larger 3-wave bounce). A break below 812 would suggest the bounce has already finished and down we go.

Jeff Bailey : 1/23/2009 12:41:23 PM

CDE and an unconventional $0.05 box to bring in some noise Link

Jeff Bailey : 1/23/2009 12:40:33 PM

Coeur D' Alene (CDE) $0.846 +5.75% Link

Jeff Bailey : 1/23/2009 12:38:04 PM

Would want to be LOOOOOONG of silver as Dennis Gartman would say.

Jeff Bailey : 1/23/2009 12:37:07 PM

Wouldn't want to be short silver ...

Jeff Bailey : 1/23/2009 12:36:14 PM

iShares Silver (SLV) $11.87 +4.76% ... $0.20 box chart to match futures Link

Jeff Bailey : 1/23/2009 12:19:40 PM

12:00 Internals found at this Link

Keene Little : 1/23/2009 12:18:35 PM

In last night's newsletter I showed the daily gold chart ( Link ) and mentioned the whole climb up from October looks like a big bear flag (albeit a bit steep for a typical bear flag). The daily chart for silver (SLV) looks like a more normal bear flag pattern: Link

The top of the flag is currently near 12.20 so that's the upside potential for now. It's showing hints of bearish divergence and I think we'll soon be getting a good short play in silver (using either SLV or YI the emini).

Jeff Bailey : 1/23/2009 11:55:35 AM

While I was filled at $0.8258 on multiple fills in personal account, will post $0.83 as established price for MM Profiles.

Jeff Bailey : 1/23/2009 11:53:18 AM

Coeur D' Alene Mines (CDE) $0.8254 +3.17% ... STOP will go $0.63. Target is $1.25

Jeff Bailey : 1/23/2009 11:52:16 AM

iShares Silver (SLV) $11.55 +1.92% ... edges above $11.50 month's resistance.

Jeff Bailey : 1/23/2009 11:43:05 AM

Swing trade long alert! for 1/8 position in shares of Coeur D' Alene Mines (CDE) at a LIMIT of $0.83/share. $0.8200 x 0.8279

This would be 1,500 shares of $10K account.

Keene Little : 1/23/2009 11:37:29 AM

Not sure if you guys have time on MM or wish to address this but thought my question may apply to others.

I have accumulated [xxxx] shares of UYG over the past two days and plan to hold them for awhile, treating them like long term options. I was wondering if it would make sense to sell OTM calls against them?

Basically it's a covered call play and not a bad idea. I did the same with TBT calls (inverse bond ETF) by buying March 37 calls in the middle of December and then after the first rally leg I sold the Jan 41 calls (which expired) and today, after the 2nd rally leg, I just sold the Feb 45 calls. Makes for a nice way to reduce your cost basis. The risk of course is watching your short call position get overrun which limits your profit potential on the original long play.

Keene Little : 1/23/2009 11:19:04 AM

It's possible we'll see SPX make it up to the 826 area, pull back into this afternoon and then get another leg up into the close (as shown on the charts posted earlier). But at this point, based on the looks of the larger pattern, I think we need to be ready for a stronger decline to kick off at any time. If we do get the larger 3-wave bounce into the end of the day, as I depicted, it should be a good setup for a short play for next week.

Jeff Bailey : 1/23/2009 11:13:47 AM

EIA: Nat Gas Storage Table Link ... Draw of 176 Bcf

Keene Little : 1/23/2009 11:12:52 AM

The bounce in the market could be over sooner than I depicted on the SPX 30-min and 60-min charts posted earlier. Two equal legs up from this morning's low is at SPX 826.39 and that might be all we're going to get before it heads south again. Protect long positions at this point and we'll see what happens.

Keene Little : 1/23/2009 11:09:19 AM

I have noticed that the pnf charts for alot of banks show a price going forward to be a zero. ZION has had a price target of 18.00 but has since fallen to 13 and change. Has this chart not recalculated and what is your chart thoughts about ZION?

Jeff is our resident expert on P&F charts so I'll let him answer that part of the question. The monthly chart is one only a mother (bear) could love: Link . I'd say the chances of dropping below $10 are pretty good.

Jeff Bailey : 1/23/2009 11:05:41 AM

Now ... for the $10K account (see 10:43:51) with 33 shares of SCO, a trader doesn't really want to do any NAKED call selling of UCO (200-x bull), or USO until he/she gets further weakness in oil (= rise in SCO), but they could begin to price out some options and put together some scenarios.

The only fundamental reason I could put together for yesterday morning's bounce was the increased build in the Strategic Petro Reserve (SPR) of 173,000 barrels.

We know the technical level, still held on a closing basis, though briefly violated on the knee-jerk.

Jane Fox : 1/23/2009 11:02:28 AM

WASHINGTON (MarketWatch) -- Some banks that have taken government capital haven't managed that money very well, President Barack Obama said Friday as he met with congressional leaders in the White House. Citing reports that bank executives had renovated their bathrooms and offices with taxpayer funds, Obama called for reforms in the way the $700 billion bank bailout money is used. Obama said the stimulus package working its way through Congress would be only one leg of an "at least three-legged stool." Obama said the government needed to move "swiftly and aggressively" as the economy and the financial system struggle.

Keene Little : 1/23/2009 10:59:59 AM

A valid (imo) comment from Barry:

In reference to the Ned Davis study, one very important difference between the tech bust and the current financial meltdown is housing. I would estimate that trillions of home equity $$ have evaporated, greatly reducing the velocity of $$ flowing thru the economy. Think about the economic impact all those home equity withdrawals had. Credit fuels the economy. During the tech bust, private sector funds were still available and redirected. This time the private money spigot has been closed.

I too want to be hopeful but I am afraid that this downturn will be much worse than the tech bust.

Barry makes an important point about the private sector funds. The government is doing so much borrowing at the moment which actually thwarts private investing. Ironically all the government is doing with this massive borrowing is slowing down the process of correcting the excesses in the economy. And then they'll be forced to remove all their money which will slow down the recovery.

Jeff Bailey : 1/23/2009 10:57:47 AM

Just a quick measure for traders

SCO +3.23%

UCO $10.72 -3.24% ...

Track pretty much tick-for-tick. There are seconds/minutes when they're +/- 1% at most, but I also like to be long one, and SHORT an option on another for the premium.

Keene Little : 1/23/2009 10:49:04 AM

On the 60-min chart I've added the sideways b-wave triangle idea showing the consolidation pattern before heading lower. Certainly the triangle pattern helps explain the whipsaw price action we've seen this week. SPX 60-min chart: Link

The daily chart is modified only slightly from last night's newsletter--taking away the bounce up to 870 before heading lower again. Now we could see something closer to 830 before heading lower again. Daily chart: Link

Jeff Bailey : 1/23/2009 10:43:51 AM

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

Keene Little : 1/23/2009 10:33:15 AM

SPX has now overlapped yesterday afternoon's low, leaving the decline from yesterday's high as a 3-wave pullback. Based on the multitude of 3-wave moves this week we may be forming a sideways triangle consolidation pattern before heading lower again next week. That pattern calls for one more 3-wave bounce up to a lower high before selling off. But any break below this morning's low would now suggest the selloff is already in progress. SPX 30-min chart: Link

Jeff Bailey : 1/23/2009 10:24:39 AM

XAL.X -3.06%, BIX.X 77.30 -2.00%, BKX.X -1.83%

Jeff Bailey : 1/23/2009 10:23:49 AM

HUI +3.03%, OIH +2.96%, SMH +2.75%

Jeff Bailey : 1/23/2009 10:22:49 AM

Schlumberger (SLB) $39.18 +5.01% ... Earnings Press Release Link

Consensus was for EPS of $1.05 on Revenue of $6.99 billion.

Jeff Bailey : 1/23/2009 10:19:36 AM

General Electric (GE) $12.57 -6.69% ... Earnings Press Release Link

Consensus was for EPS of $0.44 on Revenue of $48.9 billion.

Jeff Bailey : 1/23/2009 10:15:01 AM

10:00 Internals found at this Link

Keene Little : 1/23/2009 10:00:47 AM

So far nice little recovery off the morning low. The move down from yesterday's high is only a 3-wave decline so far and therefore we will either get another drop lower following this bounce (can't go much higher) or else the 3-wave pullback is just a correction and how we'll get a strong rally leg. Above SPX 820 (which would overlap yesterday afternoon's low) would be the first clue we might get the strong rally leg.

Jane Fox : 1/23/2009 9:50:13 AM

LONDON (MarketWatch) -- The British economy contracted at its fastest quarterly pace in nearly 29 years during the final three months of 2008, government data revealed Friday, marking a result even worse than most economists' pessimistic expectations.

Gross domestic product shrank by 1.5% in the final three months of the year, following a 0.6% quarterly contraction in the July-to-September period, the office for national statistics said in its initial estimate. That was the steepest quarterly drop since 1980, and also met the widely-used definition of a recession of two consecutive quarters of declining GDP.

What's more, GDP shrank 1.8% compared to the final quarter of 2007. The figures imply full-year 2008 growth was just 0.7%, economists said, and underlined the possibility the recession could mark Britain's worst post-war slowdown.

Jane Fox : 1/23/2009 9:48:00 AM

Here is another reality check, the TRIN. Shouldn't it be a lot higher this morning? It may mean we just had another infusion of cash into the market today so don't take it too seriously. Link

Jane Fox : 1/23/2009 9:44:47 AM

Mark Hulbert of MarketWatch.com posted a fascinating study published Thursday by Ned Davis Research, the Venice, Fla.-based quantitative research firm. This firm compared the popping of the financial sector's bubble over the last 18 months to the Internet bubble burst of 2000-2002.

In several significant ways, the internet bubble burst was even more traumatic than what we have just lived through. One example is, since its peak in 2007, the financial stocks in the S&P 500 index have dropped 78.7%, whereas the IT stocks fell 82.5% in the 2000-2002 bear market.

Of course one could argue the financials are a much more important sector than technology, correct? According to Ned Davis Research, the IT sector represented about 35% of the S&P 500 at its 2000 peak, but the financials were only a 22% weight at its peak in 2007. So you see, a greater amount of total market capitalization was destroyed by the tech sector's decline in the 2000-2002 bear market ($3.6 trillion) than by the financial sector's decline since 2007 ($2.2 trillion).

Just a little reality check for a Friday morning.

Hulbert went on to say "Just as it's dangerous at the top of a bull market to think that "this time is different" -- and that the old rules no longer apply -- the same is true when we're at the depths of a bear market. Just as trees don't grow to the sky, as John Maynard Keynes famously once remarked, those trees' roots won't continue descending until they get to China either."

The stock market did finally recover from the Internet bust, and so will the current bear market eventually give way to a new bull market.

Jane Fox : 1/23/2009 9:42:48 AM

VIX closed Thursday at 47.50 and gapped up this morning to open at 50.10.

Jane Fox : 1/23/2009 9:42:05 AM

AD line is a very bearish -2010.

Jane Fox : 1/23/2009 9:26:11 AM

DOW futures are down -202, S&P down -21.75, NDX down -23.50.

Jane Fox : 1/23/2009 9:25:27 AM

The Crude market is not looking much healthier than the equity market. Link

Jane Fox : 1/23/2009 9:22:46 AM

The news out from GE was more than the bulls could handle and the markets had a rough night - again. All four major indexes we watch here in the monitor made a series of lower highs and lows and all respective previous day lows were breached. The DOW (YM) is trading well under 8000 however, the S&P (ES) has being able to stay above 800, barely. Link

Keene Little : 1/23/2009 9:20:38 AM

It looks like we have our answer as to which way the market will go this morning. It's not going to be a pretty start to the day--big gap down. ES is back to its lows on Tuesday and Wednesday so there's always the possibility that the test of those lows will hold. But at this point one would have to assume the market is weak. Now the question is whether or not there will be follow through to the downside today.

Jane Fox : 1/23/2009 9:16:03 AM

NEW YORK (MarketWatch) -- General Electric Co. said Friday fourth-quarter earnings fell 44% on heavy declines in its financial and consumer-products businesses due to the global economic downturn, but the conglomerate refrained from cutting its dividend.

For weeks, analysts and investors have speculated that the Dow Jones Industrial Average component would have to lower its payout to shareholders or put its AAA credit rating -- a gemstone in GE's business model -- at risk.

In an interview on CNBC, Chief Executive Jeff Immelt declined to say which he would pick if his hand was forced. "I won't even go there," he said, again emphasizing that the dividend was safe.

On Jan. 13, Moody's Investors Service lowered its outlook for GE to negative from stable, following a similar move by Standard & Poor's in December. A negative outlook typically implies a 33% chance of a credit downgrade within two years, leading to higher debt-related costs.

Jane Fox : 1/23/2009 9:08:29 AM

Dateline WSJ - Pfizer Inc. is in talks to acquire rival drug maker Wyeth in a deal that could be valued at more than $60 billion, said people familiar with the matter.

A combination of these two U.S. pharmaceutical giants would redraw the boundaries of the global drug industry, which has suffered from flagging product development and high fixed costs. It would also represent a high-stakes gambit for Pfizer, which has been stung in the past by expensive acquisitions.

The two sides have been in discussions for months and a deal isn't imminent, the people said. Given recent market volatility and overall economic uncertainty, the talks are especially fragile and could collapse, the people warned.

Pfizer spokesman Raymond F. Kerins Jr. said the company doesn't comment on "market rumors and speculation." A Wyeth spokesman said, "We don't comment on marketplace rumor."

Jeff Bailey : 1/22/2009 11:49:12 PM

YM ready for tomorrow's cash session. DS1 is 7,946 (note overlap/WS1); DR1 8,198/ MS1 just above. Link

Jeff Bailey : 1/22/2009 11:36:34 PM

YM off 42 at 8,050

Jeff Bailey : 1/22/2009 11:19:24 PM

Asian Markets Link ... SNY Link warns of "big loss" finds $NIKK Link off 179, or -2.23% at 7,873.

$HSI Link up a fraction at 12,687.

$SSEC off a fraction at 2,001 Link

Jeff Bailey : 1/22/2009 11:12:43 PM

RUT.X Link

Jeff Bailey : 1/22/2009 11:09:34 PM

NDX Link
BPNDX Link

Jeff Bailey : 1/22/2009 11:04:16 PM

SPX Link
BPSPX Link

Jeff Bailey : 1/22/2009 11:00:48 PM

IBM finished $90.07 -1.47% Link ... as a possible "market indicator" at option strikes, a bull would really want to see Big Blue stay above the $85 strike, but grow more bullish if market participants can push it higher from the $90 as an indication that "all is OK" going forward and any covered call sellers want to save the position (not lose the stock/have it called away).

Same type of thing for AAPL Link , but it has quite a bit more overhead supply to deal with.

Jeff Bailey : 1/22/2009 10:50:10 PM

Traders may want to keep a closer-than-usual eye on the VIX.X tomorrow as it has been either side of its WKLY and MONTHLY Pivots, largely above this week.

DAILY Pivot tomorrow is 48.55.

IBM and AAPL saw a near-term "positive" response to earnings. GOOG looks a bit more "we'll see."

NH/NL indications weak again, but nearing some inflection low levels and 2-days of some pause measures.

Thought with the VIX.X is if it starts jerking higher, then that's likely a sign that market participants still uncertain that a low was found in November.

Keene Little : 1/22/2009 10:11:02 PM

Friday's pivot table: Link

As I had commented at the end of the day Thursday, it's a coin toss for where the market heads next. Not much more to add than that--just need to wait and see which way price leads us. A break of either Wednesday's high or low should lead to a move in that direction (upside target for SPX is 870 while the downside target could be as low as the November low at 741). SPX 120-min chart: Link

OI Technical Staff : 1/22/2009 9:59:59 PM

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