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Jeff Bailey : 2/18/2009 5:01:58 PM

dj- ICI: Inflows To Long-Term Mutual Funds $3.17B In Latest Week

(see also MM 12:57:25)

Jeff Bailey : 2/18/2009 4:56:29 PM

Closing Internals at this Link

Keene Little : 2/18/2009 4:18:46 PM

Futures sold off after the close (on HP's earnings I guess) and made a new daily low. That's not a good sign for tomorrow.

Jeff Bailey : 2/18/2009 4:15:59 PM

SPY $79.03 -0.23% ...

Jeff Bailey : 2/18/2009 4:15:37 PM

DIA $75.32 -0.56% ...

Jeff Bailey : 2/18/2009 4:14:51 PM

Hewlett Packard (HPQ) $34.08 -0.75% ... slips to $33.00 extended on headline numbers.

Keene Little : 2/18/2009 4:13:14 PM

Because this afternoon's bounce remains so corrective looking I think we need to stay aware of the possibility for a nasty downside surprise. If the market gaps down tomorrow morning it will be time to chase it lower as I could see the possibility for a wicked selloff. That's just speculation at this time but the correctiveness of this afternoon's bounce has me wary of the possibility. Be careful if long the market.

Keene Little : 2/18/2009 3:56:21 PM

Today's choppy day looks more like consolidation than anything else when looking at it on the 60-min chart. Therefore there hasn't been much of a change to the SPX 60-min chart from last night's: Link . Unless we see price break below today's low from here I'm still expecting another leg up and the 804-808 area is the target. From there we should get a very fast decline. But seeing SPX hold around 800 into Friday morning remains a distinct possibility.

Keene Little : 2/18/2009 3:21:00 PM

We got a little pullback to test today's broken downtrend line and a bounce off it but the bulls sure are struggling here. This should be flying to the upside but not yet. Assuming the bulls will get something going in the next 40 minutes, a logical upside target zone for now is 804-808, which are the lows on January 20th and February 12th. If this bounce fails and we get a drop to a new daily low forget about the long side--get short and hang on.

Jeff Bailey : 2/18/2009 3:19:34 PM

"Bad tick" in FCX $28.27 +4.20% ... at $20.08.

Jeff Bailey : 2/18/2009 3:07:24 PM

International Business Machines (IBM) $91.97 +1.43% ... Still holding above 01/06/09 relative high.

Keene Little : 2/18/2009 3:04:34 PM

Here they come to save the day (using Jeff's Mighty Mouse symbolism)--the downtrend line from today's high has now been broken. If we get another leg up for the bounce off this morning's low, two equal legs up would be at SPX 798.64 (not even a 38% retracement of the decline from Friday). If the 2nd leg up achieves 162% of this morning's rally then we'd get up to SPX 808.37, close to a 50% retracement (809.93).

Jeff Bailey : 2/18/2009 3:00:14 PM

UUP $26.51 +0.38% ... while I'm there Link

Monthly R1/WKLY R2 has held sellers to this point.

Jeff Bailey : 2/18/2009 2:57:55 PM

Research in Motion (RIMM) $42.25 -5.35% ... near's 11/20/08 low. (see Wednesday's Market Wrap) Link

Jane Fox : 2/18/2009 2:56:01 PM

Here is an update to the 2 day look at ES and the VIX. Geesh!!! Link

Jeff Bailey : 2/18/2009 2:52:10 PM

SPX 785.55 -0.45% ...

Jeff Bailey : 2/18/2009 2:51:14 PM

NASDAQ a/d 1,041/1,642

Jeff Bailey : 2/18/2009 2:51:01 PM

NYSE a/d 781/2,273

Keene Little : 2/18/2009 2:50:15 PM

This afternoon's decline has thus far been contained in a parallel down-channel with overlapping highs and lows--it continues to look like a bull flag. Play the breakout for a day-trade long as we should get another leg up matching the one from this morning's low to the mid-day high (16 SPX points). But let it prove it's going to break out.

Jeff Bailey : 2/18/2009 2:49:19 PM

RUT.X 423.16 -1.33% ... slips back below DAILY S1 again. With the NH/NL readings at the NASDAQ, I know not how it holds on here.

Keene Little : 2/18/2009 2:27:10 PM

We've got a sloppy decline this afternoon so it's hard to feel bearish about it. I wouldn't be surprised to see a sharp rally into the close today. The larger A-B-C bounce pattern could tolerate a minor new low today but watch the trend line along the lows for this afternoon's decline--it should not break if we've got another leg up coming.

Jeff Bailey : 2/18/2009 2:24:37 PM

Pretty big volume spike this afternoon at 01:25-30 PM ET.

Jeff Bailey : 2/18/2009 2:23:55 PM

Disclosure: I currently hold bullish position in CDE.

Jeff Bailey : 2/18/2009 2:23:07 PM

Swing trade long alert! ... for 1/8 position in shares of Coeur D' Alene Mines (CDE) at the offer $0.7318, LIMIT $0.74.

STOP goes $0.65. Target $1.20

Keene Little : 2/18/2009 1:46:15 PM

The bulls need to make a stand here otherwise the selling could intensify.

Jeff Bailey : 2/18/2009 1:34:09 PM

YM "in the zone" 7,530

Jeff Bailey : 2/18/2009 1:33:23 PM

Bernanke Speech (ends) ... SPX 788.50 -0.08%

Jane Fox : 2/18/2009 1:27:36 PM

WASHINGTON (MarketWatch) - The "extraordinary measures" taken by the Federal Reserve to restore the flow of credit vital to the economy won't stoke inflation, Fed Chairman Ben Bernanke said Wednesday. In a rare appearance before journalists at the National Press Club, Bernanke said the Fed will be able to quickly reverse much of what it's done to expand credit, once the economy improves. Bernanke emphasized that restoring the economy to vigor is the Fed's one and only job now, and that concerns about inflation must wait. For now, deflation is a greater concern. "Extraordinary times call for extraordinary measures," he said.

Keene Little : 2/18/2009 1:23:58 PM

If we've got higher to go for the bounce off this morning's low, the current pullback should find support soon and turn back up. Two equal legs down from today's mid-day high is at SPX 785. Watch for support there (or not).

Keene Little : 2/18/2009 1:12:01 PM

After making it up into the 372-395 resistance zone GOOG tumbled back down. It has dropped below what was resistance, then support, and now resistance again at 353. I think GOOG will continue lower from here as long as it doesn't rally back above 864, the January 12th high. Above 864 and we'll probably see new highs on GOOG before it's finished. It takes a drop below 332 to improve the odds for the bears. GOOG daily chart: Link

GOOG's weekly chart supports the idea that a high is in so until proven otherwise (with a rally back above 864) I think the short side is the correct side for GOOG: Link

Jeff Bailey : 2/18/2009 1:11:23 PM

SPX 789.91 +0.09% ...

Jeff Bailey : 2/18/2009 1:11:04 PM

Fed Chairman Ben S. Bernanke's Speech Link

Jane Fox : 2/18/2009 1:10:42 PM

AD line is now falling below -1000 again. This is a very good market to just watch.

Jeff Bailey : 2/18/2009 1:01:44 PM

Fannie Mae (FNM) $0.63 +11.49% ...

Jeff Bailey : 2/18/2009 1:01:17 PM

Freddie Mac (FRE) $0.64 +15.98% ...

Jeff Bailey : 2/18/2009 12:58:32 PM


DJ- Bond insurer MBIA's new bond-insurance startup is set to write coverage on the surge of municipal bonds that will be issued to finance projects under the recently enacted stimulus plan.

MBI $4.64 +33.34% ... all over the board this morning.

Jeff Bailey : 2/18/2009 12:57:25 PM


DJ- Hedge-funds outflows total an estimated $74 billion in January, the second-highest rate ever, according to TrimTabs. Event-driven funds post biggest outflows at $19.8 billion. Merger-arbitrage funds report $2 billion inflows.

Jeff Bailey : 2/18/2009 12:54:46 PM


DJ- The Treasury says it is changing the preferred stock purchase deals made to make sure Fannie Mae and Freddie Mac maintain a positive net worth. The deals are being amended to $200 billion each from original $100 billion each.

Jane Fox : 2/18/2009 12:49:59 PM

Here is the S&P futures and the VIX for the last 2 days. Pretty narrow range. Link

Jeff Bailey : 2/18/2009 12:40:19 PM

dj- S&P: GM, Chrysler Debt Ratings Won't Be Affected By Plans

GM $2.107 -3.32% ...

Jane Fox : 2/18/2009 12:22:26 PM

Here are your overnight charts. NDX futures have broken their overnight highs and the DOW is trying but has not been too successful. Link

Jane Fox : 2/18/2009 12:15:52 PM

The bulls are pulling up their socks and staging a rally. TRIN has becoming quite bullish and VIX is almost making new daily lows. Keep in mind though the AD line/volume/ratio are all still on the bearish side. They are getting better but certainly not anywhere near bullish. Link

Jeff Bailey : 2/18/2009 12:15:38 PM

12:00 Internals at this Link

Keene Little : 2/18/2009 12:15:26 PM

With the push higher right here it looks like we've got a clean 5-wave move up off this morning's low. We should soon get a pullback to correct the bounce but that will be followed by another leg up to give us a larger A-B-C bounce into the end of the day.

Keene Little : 2/18/2009 12:05:03 PM

NDX is currently struggling with its broken uptrend line from November, just under 1200. It's also at the bottom of yesterday's gap down. Assuming it will be able to bounce a little higher I see the potential for a bounce up to about 1210 before turning lower again. There remains the possibility for a much bigger bounce back up to the top of its ascending triangle near 1286, shown in pink, but I think that's a low probability at this point (just stay aware of the possibility). Until proven otherwise I think we've started the next big decline, as depicted in dark red on the 60-min chart: Link

Jeff Bailey : 2/18/2009 11:49:14 AM

SPX 794.47 +0.67% ...

Jeff Bailey : 2/18/2009 11:48:57 AM

10-year YIELD ($TNX.X) rebounds higher to 2.727% and reclaims its WKLY S1 after near-kiss of MONTHLY Pivot.

Keene Little : 2/18/2009 11:20:09 AM

This bounce looks like it could develop some legs. NDX is the stronger index again and leading the way higher back into the green.

Jeff Bailey : 2/18/2009 11:04:40 AM

SPX 784.86

Jeff Bailey : 2/18/2009 11:04:26 AM

BIX.X 62.02 -5.58% ... sets up for test of overlapping WKLY S2/MONTHLY S1

Keene Little : 2/18/2009 10:52:59 AM

We're into a bigger bounce than I expected to see before getting a minor new low. We've either put in a bottom for the day or we've got a lot lower to go than SPX 778. If the market now drops back down from here to a new daily low it could accelerate lower. It takes a push above 792 to suggest we've seen the low for the day.

Jeff Bailey : 2/18/2009 10:51:11 AM

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

CTIC resumed trading

Jeff Bailey : 2/18/2009 10:32:03 AM

10:00 Internals found at this Link

Jane Fox : 2/18/2009 10:31:19 AM

Keene is drawing his ascending wedge on the Gold chart a little different from mine and is coming to a different conclusion. I think the wedge has broken which is bullish but Keene's wedge has not broken. I also see the MACD's bearish divergence is gone which to me is another bullish indication.

This is the problem with technical analysis. Sometimes you get all technicians on one side but more often you have differing views. Some of the analysts I trust a great deal are telling me we are forming a bottom to the bear market yet others are saying we have a lot more downside.

At times like this I think the best trade (or investment) is no investment. I highly respect Keene's analysis but it still differs from mine so I am stepping aside any kind of Gold trade. Link

Keene Little : 2/18/2009 10:18:49 AM

If we now get a small bounce and minor new low, especially to about SPX 778, it could be a good setup for a bounce back up to about 810 by late today/early tomorrow. SPX settling near 800 by the end of the day Thursday (for expiration Friday morning) wouldn't surprise me in the least.

Jane Fox : 2/18/2009 10:07:30 AM

S&P and DOW are now testing overnight lows. If I were a betting woman I would bet they do not hold.

Keene Little : 2/18/2009 10:06:14 AM

With SPX bouncing this morning but now dropping below yesterday's close it raises the probability that we'll see a move down to at least 778 (where the 5th wave = 162% of the 1st wave) before starting the bigger bounce.

Keene Little : 2/18/2009 10:03:23 AM

Gold is at an important spot and potentially topping. Yesterday I sent out an intra-week blog update for the LEAPs Trader saying our upper trigger price for the LEAP put on GDX (gold miners) had been hit (37.40). The daily chart of gold (GC) shows price ran up to the top of its parallel up-channel from October and the top of a small rising wedge from January. If gold is going to reverse back down it will do it from here.
GC daily chart: Link
GDX daily chart: Link

Jane Fox : 2/18/2009 9:59:04 AM

It certainly didn't take long for the bears to overrule the bulls. It is looking like the overnight highs may not even be challenged intraday let alone the pervious day highs.

Jane Fox : 2/18/2009 9:34:52 AM

AD line is +708 so bullish but like the overnight session certainly not overly so.

Jane Fox : 2/18/2009 9:33:21 AM

Crude (West Texas Crude) continues to languish and is finding no buyers. Here is the March contract. Link

Here is the West Texas Crude April Contract. This contract is trading at 16K whereas the March Contract is at 5K. Link

Here is the April Brent Crude contract Link

Jane Fox : 2/18/2009 9:24:09 AM

WASHINGTON (MarketWatch) - The output of the nation's factories, mines and utilities plunged 1.8% in January, the Federal Reserve said Tuesday. Output has fallen in five of the last six months. The figures were roughly in line with forecasts by economists surveyed by MarketWatch. Output in December was also weaker than previously estimated. Output fell a revised 2.4% in December, compared with the initial estimate of a 2.0% drop. Manufacturing declined 2.5%, led by a plunge in auto production. Capacity utilization - a gauge of inflationary pressures -- fell to 72.0%. This is the lowest level since February 1983. For factories alone, capacity in use fell to a new record post-war low of 68.0%.

Jane Fox : 2/18/2009 9:22:57 AM

Here are your overnight charts. Looks like the bulls have staged a comeback, although I don't think it will be long lived. The higher high made at 6:10 was pretty weak and has not had any kind of follow through. The bulls may be able to break their respective ON highs during the intraday session but I doubt if they will be able to break previous day highs. Link

Keene Little : 2/18/2009 9:22:38 AM

Equity futures had rallied last night, gave it all back, and then some, by 5:00 AM and then rallied back up to a new pre-market high about 15 minutes ago. I'm always suspicious of an attempt to push futures up strongly in the pre-market session as many times it doesn't hold. But the wave pattern supports the possibility that we're going to see a bigger bounce today to correct the decline from Friday. SPX 810-815 is the potential and it could take us into tomorrow (so be prepared for a choppy session).

Jane Fox : 2/18/2009 9:15:15 AM

WASHINGTON (MarketWatch) -- Prices of imported goods and services dropped 1.1% in January and are down a record 12.5% in the past year, the Labor Department reported Wednesday. Prices of imported petroleum fell 2.4% in January, the sixth consecutive decline. Prices of nonfuel imports fell 0.7% in January and are down 0.3% in the past year. Meanwhile, prices of exports rose 0.5%, the first increase since July. Link

Jane Fox : 2/18/2009 9:12:51 AM

Here is a chart of Housing starts from July 18, 2007 to Feb 18, 2009. Link

Jane Fox : 2/18/2009 9:06:11 AM

WASHINGTON (MarketWatch) - Construction on new U.S. housing units plunged 16.8% in January to a seasonally adjusted annual rate of 466,000, the Commerce Department reported Wednesday, far below the weakest levels of the post-World War II era. Housing starts have dropped at double-digit rates for three straight months. At this rate, starts would fall to zero by the end of the year. Starts are down a record 56% in the past year and are down 79% from the peak three years ago. Housing starts in January were much worse than expected. Building permits, less volatile than the housing starts data, fell 4.8% to a seasonally adjusted annual rate of 521,000, also a record low.

Jeff Bailey : 2/18/2009 2:13:39 AM

World Bullish % Bell Curve at this Link

Would protect gains in Shanghai, no new bull entries. Look for new entries 50%.

Jeff Bailey : 2/18/2009 1:20:53 AM

Major Market Bullish % I track at this Link

Defensive team on the field.

Jeff Bailey : 2/18/2009 1:12:27 AM

BPNDX reverses back lower to "bull correction" now at 50.00% with net loss of 5 stocks to reversing lower PnF sell signals. 56% now needed for reversal back higher. 46% needed for "bear confirmed."

Jeff Bailey : 2/18/2009 1:04:08 AM

BPALL reverses back lower to 32.022% actual (34.00% chart). "Bull correction" now, but 32.00% or lower would be "bear confirmed."

Jeff Bailey : 2/18/2009 1:01:58 AM

Dorsey/Wright's BPSPX sees a net loss of 44 stocks to reversing lower PnF sell signals to 38.60% (40.00% chart).

Jeff Bailey : 2/18/2009 12:55:29 AM

YM 5-minute interval recap Link

Did try a YM long late morning after repeated tests of WKLY S1/MONTHLY S1 overlap test. Couldn't must more than 7,608 and took +10.

Jeff Bailey : 2/18/2009 12:47:34 AM

Time 12:44:10

Jeff Bailey : 2/18/2009 12:41:32 AM

DIA 5-minute intervals (cursor box at 09:45-50 interval) Link for DIJ-BC.

Needed a gap ABOVE $79.66 and drive. Didn't get it and when SPX went WKLY R1, had to bail.

Jeff Bailey : 2/18/2009 12:31:03 AM

SPX Daily Interval Montage at this Link

WKLY S2 at (769.69), WKLY S1 (798.26) violated Tuesday at 09:45-09:50 AM ET. (see MM Posting)

Jeff Bailey : 2/18/2009 12:24:10 AM

Three (3) points of Pivot retracement overlap at approx. SPX 771.

Jeff Bailey : 2/17/2009 11:39:39 PM

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

Keene Little : 2/17/2009 10:07:19 PM

Wednesday's pivot table: Link

The price pattern for the decline from Friday looks ready for a bounce to correct it, perhaps after a minor low Wednesday morning. The SPX 60-min chart shows how price might bounce and decline this week: Link

OI Technical Staff : 2/17/2009 9:59:59 PM

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