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Jeff Bailey : 2/9/2009 5:12:32 PM

Closing Internals at this Link

Jeff Bailey : 2/9/2009 5:12:28 PM

Pacholder High Yield (PHF) $5.00 +5.83% ... 02/05/09 NAV and Stock Price Link

HYG $74.40 +0.77% ...

Keene Little : 2/9/2009 4:02:05 PM

I made a small correction to the wave labels on the SPX 60-min chart. The top of the bounce tomorrow, if it plays out as expected, will be the conclusion of the a-b-c bounce from January for wave B (or wave 2 of a larger 5-wave decline that will drive prices to new lows into March). Corrected chart: Link

Keene Little : 2/9/2009 3:59:00 PM

The same pattern (rising wedge) I showed for the RUT fits very well for SPX as well. Two equal legs up from the January low is at 886 and that crosses the top of the wedge mid day tomorrow--a positive reaction to Geithner's plan could give us a classic throw-over finish (often on news) to be followed by a sell-the-news reaction. The pattern, Fibs and market psychology fit well. SPX 60-min chart: Link

Jeff Bailey : 2/9/2009 3:56:05 PM

UYG $3.69 +2.78% ... have CLOSED out at $3.63.

Jeff Bailey : 2/9/2009 3:55:18 PM

IWM $46.74 -0.46% ...

Continue to hold IWM-CU $2.61 x $2.62

Keene Little : 2/9/2009 3:47:37 PM

The techs (NDX) continue to show relative strength but the small caps are not participating with the techs and that's a bearish non-confirmation. The RUT's pattern is looking like a potential rising wedge for the c-wave of an A-B-C bounce off the January low. Two equal legs up for that bounce is near 480 so that's the upside potential for the RUT that I see at the moment. The pattern would then call for a quick drop to a new low below January's. RUT 60-min chart: Link

Keene Little : 2/9/2009 3:30:34 PM

Looks like they're jamming the shorts again as we head into the final 30 minutes of trading. The bears seem to be more nervous than the bulls. The sentiment numbers point to excessive bullishness and that's not a good thing as we wait for resolution of the stimulus and bailout packages. But a quick rally higher as a first reaction clearly remains a possibility.

Jeff Bailey : 2/9/2009 2:54:10 PM

BIX.X 91.15 +1.48% ... session high of 93.25 still shy of Q S1 (93.61) RSD.

Jeff Bailey : 2/9/2009 2:52:54 PM

May have been a stop run on some retail sector shorts (see MM 12:40:03)

With YM and INDU/DIA still no trade at MONTHLY Pivot, play some defense and lock in gains.

Jeff Bailey : 2/9/2009 2:50:03 PM

XBD.X 76.69 -1.22% ...

Jeff Bailey : 2/9/2009 2:49:32 PM

Swing trade long exit alert! ... for the 1/8 position in the ProShares Ultra Financials (UYG) at the bid of $3.63

Keene Little : 2/9/2009 2:40:20 PM

SPX 860 remains a key level to the downside. Until the bears take that out we could be getting just a pullback correction before the market proceeds higher again.

Keene Little : 2/9/2009 2:25:49 PM

The bulls are trying to hold on here but the price pattern is turning more bearish.

Jeff Bailey : 2/9/2009 2:16:25 PM

02:00 Internals at this Link

Keene Little : 2/9/2009 1:47:29 PM

Referenceing my post on USO (11:38 AM) here's some more information on USO that is worth sharing from Joe (who has obviously studied oil):

That strange bearish drifting pattern is USO, and the Bearish projection for USO, is still largely due to the 'Contango' in the CLO09 contract, whereby the next month contract starts higher, than the expiring, then generally sees downside into expiration...... It's put the USO on a bearish treadmill every month, and until 'Backwardization' (front month contract trade higher that rear month) returns to crude, it will continue.

Some of the general common sensical fundamental factors that will be at play when Contango goes to Backwardization will be 1.) Increased Demand 2.) Increased capital input into the commodity (AKA investor speculation) 3.) Decease in supply or supply destruction, which is happening with canceled projects 4.) Generally, from my reading once the reversal from Contango to Backwardization starts materializing, there will begin to be one final dump of the glut of oil on the market, as supplier/ storers will dump their stored reserves to prevent loss, as it will not be more profitable own front month contracts rather than store for a rear delivery date.

Nice analysis Joe, thanks.

Keene Little : 2/9/2009 1:46:42 PM

We've got a bit of a reversal in progress for both bonds and stocks. Two equal legs down from this morning's high is at SPX 866.03 and the low so far is 866.11. That should hold if this is going to be just a correction before heading to new highs. Lower than 865 would suggest we've seen the high.

Jeff Bailey : 2/9/2009 1:17:34 PM

10-year Yield ($TNX.X) ... 3.047% ... still no yield trade at WKLY R1/MONTHLY R1 overlap.

Keene Little : 2/9/2009 1:16:00 PM

Following up on my earlier comment on the bonds and why I see a buying opportunity for TLT, the daily chart shows price dropping lower inside a bullish descending wedge (bullish until price drops out the bottom) and has dropped to within 40 cents of its September high at 100.86. You can try it here or wait for a break of the downtrend line, currently near 102.50. Link

Jeff Bailey : 2/9/2009 1:12:36 PM

SPX 873.20 +0.52% ...

Jeff Bailey : 2/9/2009 1:10:52 PM

As opposite as you can get (BROAD and SMALL) and (NARROW and LARGE).

Jeff Bailey : 2/9/2009 1:10:00 PM

My mind's eye currently has RUT.X's MONTHLY Pivot defining support.

INDU's MONTHLY Pivot defining resistance.

Jeff Bailey : 2/9/2009 1:07:38 PM

Neither has seen trade at RSD MONTHLY Pivot.

Jeff Bailey : 2/9/2009 1:07:00 PM

YM 8,271

INDU 8,306

Jeff Bailey : 2/9/2009 12:58:58 PM

dj- Obama: Will try and include cramdown provision in housing package

Jeff Bailey : 2/9/2009 12:53:05 PM

UUP $25.50 -0.81% ...
FXE $130.48 +0.94%
FXY $108.60 +0.36%
FXB $149.50 +0.97%

Jeff Bailey : 2/9/2009 12:52:04 PM

Coeur D' Alene Mines (CDE) $0.7093 x $0.71.

Jeff Bailey : 2/9/2009 12:51:30 PM

HUI.X 298.78 -2.67% ... slips back below the 300 strike and WKLY Pivot 300.07.

Jeff Bailey : 2/9/2009 12:45:56 PM

HIG $15.37 +21.21% ... see Friday's MM notes.

Jeff Bailey : 2/9/2009 12:45:33 PM

IUX.X 122.50 +2.39% ...

Jeff Bailey : 2/9/2009 12:45:20 PM

BIX.X 91.65 +2.03% ...

BKX.X 31.32 +3.12%

Jeff Bailey : 2/9/2009 12:44:52 PM

UYG $3.72 +3.62% ...

Jeff Bailey : 2/9/2009 12:44:28 PM

XLF $9.98 +1.94% ...

Keene Little : 2/9/2009 12:43:46 PM

Bonds have been settling for most of the day but look they could be putting in a bottom soon. If you're interested in playing TLT to the long side I think we're close to buying opportunity. Equities give me the opposite impression so we may be nearing the point of reversal for both. Currently the market seems to be basically on hold and waiting.

Jeff Bailey : 2/9/2009 12:40:42 PM

Broker/Dealer Index (XBD.X) 81.03 +0.43% ... sticks its head above 01/27/09 relative high. WKLY R1 84.14 and 01/06/09 inflection high may be in play.

Jeff Bailey : 2/9/2009 12:32:35 PM

dj- Origin Agritech Announces Second Notes Repurchase Agreement

SEED $2.38 +1.27% ...

Jeff Bailey : 2/9/2009 12:12:41 PM

12:00 Internals at this Link

Keene Little : 2/9/2009 11:38:47 AM

USO has remained in a very strange pattern with it continuing to sink lower since early January but more in a drifting pattern than anything else. But it's possible we're seeing a descending triangle pattern which calls for one more small bounce, which could get slightly above 31, before we see another leg down. At this point I think we need to see USO above 33 before declaring a bottom is in. In the meantime further downside appears to be the next move for USO, potentially down to 22 (if not lower). Daily chart: Link

Jeff Bailey : 2/9/2009 11:31:19 AM

Keene ... that is BELOW the MONTHLY Pivot.

Yes, you read my analysis correct, but it has TECHNICAL MERIT for institutional support/resistance observed.

SEE 11:23:46

Jeff Bailey : 2/9/2009 11:28:30 AM

IWM $46.89 -0.14% ...

IWM-CU $2.70 x $2.73

RVX.X 50.45 +1.63% ...

Keene Little : 2/9/2009 11:27:41 AM

Jeff, did I read your 11:23 AM post correctly? Did you say "stop at a new low"? Tsk, tsk--you're taking on my bad habits (wink and a smile).

Jeff Bailey : 2/9/2009 11:25:24 AM

Swing trade call establish stop alert! ... Let's establish a stop for the IWM-CU at $45.90 in the underlying.

Jeff Bailey : 2/9/2009 11:23:46 AM

RUT.X daily intervals with RSD MONTHLY/QUARTERLY Pivot retracement. Link

Morning low just undercuts Feb MONTHLY Pivot and Jan's still serving some resistance.

Can establish a stop on IWM-CU just under WKLY Pivot, or ~$0.20 under day's low of IWM itself.

Keene Little : 2/9/2009 11:08:41 AM

Volume is running a little less than Friday's at this point which is not what the bulls want to see. The 5th wave in the move up from Thursday should show some negative divergences against Friday's high and so far that's what we're getting. At this point I think it's a lack of selling more than strength of buying that's giving us the rally. But price rules so stay disciplined in your trading. A break back below 865 would be a heads up that the rally from Thursday is finished and below this morning's low to confirm it. In the meantime the bulls have control of the ball.

Jeff Bailey : 2/9/2009 10:55:53 AM

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

Keene Little : 2/9/2009 10:53:46 AM

Pressing higher (hope is still alive and well). This could be good for another 10 points higher for SPX. But if it's the 5th wave for the move up from Thursday it has now achieved the minimum requirement for it so stay aware of the potential for an immediate reversal at any time.

Keene Little : 2/9/2009 10:46:02 AM

SPX has bounced back up to its broken uptrend line from Thursday, just shy of 870. Kiss goodbye next or can the bulls keep it going?

Jeff Bailey : 2/9/2009 10:45:30 AM

Swing trade long adjusted target alert! ... for the 1/8 position in the ProShares UltraFinancials (UYG) $3.68 +2.22% ... Adjusted target is $4.15.

Jeff Bailey : 2/9/2009 10:37:14 AM

European Markets Link ... mirror U.S. early morning trade with fractional gains/losses.

$FTSE Link up 3.74 points at 4,295

$DAX Link off 13 at 4,632

$CAC Link lower by 10 at 3,113.

Jeff Bailey : 2/9/2009 10:33:52 AM

Asian Markets Link ... Finished mixed-to-higher with $NIKK off 107.59 points, or -1.33% at 7,969 Link

$HSI Link rose 114.02, or +0.84% to 13,769.

$SSEC Link added 43.47, +1.99% to 2,224.71 after breaking above its bearish resistance last week.

Jeff Bailey : 2/9/2009 10:29:23 AM

Today's Global Economic Calendar Link and Link

Keene Little : 2/9/2009 10:20:36 AM

The SPX 859-860 area is potential support by both Fibs and a trend line. The top of a parallel up-channel created off the uptrend line from February 2nd (last Monday) is currently near 859 and if the bulls have more work to do this line should hold. If the current pullback is part of a 5-wave advance from Thursday then we'll get another leg up to finish it and that's where the Fib projection at 883-886 would come into play. But a break below 850 would negate the pink wave count that calls for a 5th wave up. SPX 30-min chart: Link

Jeff Bailey : 2/9/2009 10:19:45 AM

10:00 Internals found at this Link

Keene Little : 2/9/2009 10:07:55 AM

This little move down has now broken the uptrend line from Thursday. Next test for SPX is 860.

Jeff Bailey : 2/9/2009 10:03:31 AM

Weekly, Monthly, Quarterly Index Pivot Matrix Link

Jane Fox : 2/9/2009 9:55:23 AM

I went snowshoeing yesterday and although two fellows in my group had GPSs we ended up veering off the trail and got lost. We were on the mountain for over 6 hours trudging through very hard terrain. I'm not sure if I didn?t drink enough or eat enough throughbut the day but I am not in very good shape today so will not be in the monitor.

Keene Little : 2/9/2009 9:54:52 AM

SPX is still holding its uptrend line from Thursday and if it manages to push higher the first Fib resistance level, based on the pattern from Thursday, is at 881. Right above that we've got some Fib levels based on the larger pattern from January 21st at 883 and 886. A break below 860 is needed to confirm the bounce from Thursday has completed.

Keene Little : 2/9/2009 9:31:37 AM

Using all-hours ES held its uptrend line from Thursday at last night's low. It hugged that line during the bounce and just short higher off the pullback low near 8:00 AM. I'm always suspicious of a pre-market rally off the overnight lows but we'll just have to see what they can do after the open (but stay aware of an immediate failure). From a Fib projection perspective I do see the possibility for ES to push up to about 873 to finish a 5-wave advance off Thursday's low.

Keene Little : 2/9/2009 9:19:35 AM

Equity futures were down hard overnight but have been lifted off their lows near 1:00 AM. ES is up more than 10 points from its low but still down 4. A retest of the overnight low would have SPX breaking Friday's low and it will clearly break the uptrend line from Thursday's low. I think we can expect at least a larger pullback to correct the rally from Thursday. Below 850 would suggestt the bounce off Monday's low has finished. So we'll see what price action looks like this morning but so far we've clearly got a bearish start to it.

Keene Little : 2/9/2009 12:02:20 AM

Monday's pivot table: Link

Friday saw SPX rally up to and stop at its 50-dma so bulls clearly want to see last week's rally continue. The daily chart shows upside potential to the downtrend line from November, currently up near 900 (pink wave count) but a turn back down is possible at any time (dark red). SPX daily chart: Link

If the rally continues Monday the 60-min chart shows the first upside target will be the 883-886 area and then higher to 900 if the pullback from there looks corrective: Link . But as shown, I expect to see the rally fail soon (if not right away) and head lower again.

On Friday I was pointing out Fib projections for NDX at 1275-1276 and that's where NDX struggled. Between the internal uptrend line from early December and the Fibs it looks like a good setup for immediate reversal Monday. NDX 60-min chart: Link

I was playing around with a couple of weekly charts over the weekend and noticed a lot of similarity between the big indexes. The granddaddy of them all, the Wilshire 5000, has a very clear setup for more downside (whether right away or from a slightly higher bounce first): Link . The downside targets are first 7100 (where the 5th wave will equal the 1st wave in percentage decline terms and then down to 6226 where the two waves would be equal in terms of price).

OI Technical Staff : 2/8/2009 9:59:59 PM

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