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Hello Jeff... You are almost as cheap as I am...LOL I'm waiting on 21.18-21.22
Steve
no cigar, orders at 21.29 sat there, as we hit 21.30, should have rounded up to 21.30 (round number support effect), but was only tacking on a generous 0.05pts over GS2-21.24 pivot level.
still waiting - I'm so cheap - QQQ21.24 !!!!
pivot formulas say QQQ21.24, lower end of Tetres lower buy range, this level should line up with SOX 8yr log chart TL, in mid 280's.
Folks:
I burned the candle at both ends this weekend, in an attempt to fix a major FrontPage 2002 screw-up but unfortunately I could not fix it. Again my lack of technology savvy shows through... I have currently messed up a bunch of files etc on my system, and have lost/corrupted my templates etc.
I have a Tech-Savvy person due in on Wednesday to help me fix my massive screw-up…She will hopefully rescue my sinking T-Wave ship…This screw-up greatly impacted this weekends news-letter.
Until then please bear with my site…I hope to have it cleared up soon…
Best of Luck
Steve
QQQ @ $21.89.
Gold climbs higher in Europe as equities ebb
August 05, 2002 06:30:00 AM ET
LONDON, Aug 5 (Reuters) - Gold advanced in the European session on Monday as stock market selling again triggered interest in the safe-haven asset.
Gold was set or "fixed" in the London morning session at $307.60 a troy ounce, up from the previous $305.50 an ounce to reach its highest fix level since July 26.
Gold is 15 percent higher than this time last year, one of the best performing financial assets.
By 1013 GMT, spot gold was quoted at $307.65/308.15 an ounce, up from $307.15/307.65 an ounce at the New York close last Friday, drawing on a slide in European equities.
"The fate of gold still looks tied to that of equity markets in the near term," said Kamal Naqvi, metals analyst at Macquarie Research.
European share prices fell on Monday as investors continued to ponder last week's poor U.S. economic data in a bid to work out where the world's economies and stock markets will head from here and whether the world's biggest economy was set for a "double dip" recession.
By 1013 GMT, the FTSE Eurotop 300 index of pan-European blue chips had lost 3.2 percent.
Gold has moved in opposition to stock markets and the dollar as investors sought the relative safety of the precious metal asset amid crumbling stocks, heightened geopolitical tensions and fears of a repeat attack on the United States.
Spot gold hit a 2-1/2-year high of $330.30 an ounce in June before prices began to trend lower on speculative selling, culminating in the yellow metal dipping below the key $300 psychological level last week.
Gold was expected to trade a $306.00/312.00 an ounce range in the near term, having recovered from last week's brief reversal as U.S. equity markets continued weak in the face of poor U.S. manufacturing data.
"While gold does have a firm feel to it and the early emphasis this week should be to the upside, there is a significant barrier on the charts from both short- and long-term technical indicators," Standard Bank London said in a report on its website, www.standardbank.com.
The market's 100-day moving average is pegged at $311.00, with the 18-day MA set at $312.00.
NEWMONT, INDIA SUPPORTIVE
Gold was supported after Newmont Mining Corp (NEM), the world's biggest gold miner, said it would look at ways to acccelerate its unravelling of the hedge positions it inherited with the takeover of Australia's Normandy Mining.
Newmont has already unwound some two million ounces of the 10-milion ounce position.
The first monsoon rains in part of India, the world's largest gold consumer also aided gold above the $300 mark.
India's southwest monsoon rains have revived after a weak phase in several regions reeling from drought, a senior weather official said on Monday.
"We can say there has been some revival in monsoon activity in the last couple of days and the outlook for the next two days is rainfall should continue," H.R. Hatwar of the India Meteorological Department told Reuters.
The June-September monsoon rains are the lifeblood of agriculture-dependent India, bringing 80 percent of the vast country's annual rain and determining its well-being each year.
But this year the monsoon has been erratic, triggering horrific flooding in the northeast but bringing little or no rain elsewhere, plunging some areas into their worst drought in over a decade and raising fears of slower economic growth.
Twelve states so far have declared either a part or all of their territory drought-affected. The full impact of the failed monsoon will not be known until mid-August.
Silver <XAG= took its lead from gold and was indicated at $4.62/4.64, up from its last New York close at $4.59/4.61.
Spot platinum <XPT= was quoted little changed at $523.00/527.00 from the previous $522.70/530.70.
Palladium <XPD= continued to find good support in the $312.00/315.00 range, last indicated steady at $315.00/321.00 from the New York close at $313.30/325.30. REUTERS
© 2002 Reuters
Poole: Fannie, Freddie Debt Poses Risk
August 04, 2002 02:34 PM ET Email this article Printer friendly version
NEW ORLEANS (Reuters) - St. Louis Federal Reserve Bank President William Poole said on Sunday stock market woes were unlikely to derail the recovery as he urged action on potential sources of future instability in financial markets, including the heavy debt load of mortgage market giants Fannie Mae FNM.N and Freddie Mac FRE.N .
"From what we know, it is reasonable to expect that the economic recovery will continue and that the stock market will in time settle down," Poole told the Council on State Governments' Southern Legislative Conference.
However, Poole did not offer a detailed view on how the sharp, prolonged market sell-off might impact the economy, instead using much of his speech to discuss what he sees as possible sources of future financial market instability.
In particular, he sounded a warning on the high debt load of so-called government-sponsored enterprises, or GSEs, such as Fannie Mae and Freddie Mac.
"In the case of the GSEs, the massive scale of their liabilities could create a massive problem in the credit markets," Poole said. "If the market value of GSE debt were to fall sharply ... what would happen? I do not know, and neither does anyone else," he said.
Fannie Mae and Freddie Mac, while shareholder-owned companies, were chartered by Congress to provide a deep and even flow of funds to mortgage markets, which they do by buying mortgages and repackaging them as securities for investors.
Under their charters, the firms have credit lines with the U.S. Treasury, which -- although never tapped -- many think has contributed to a view in the market that the government would stand behind their massive debts.
The two companies had $1.3 trillion in debt outstanding at the end of last year and, according to Poole, had guaranteed another $1.8 trillion of mortgage-backed securities.
"The total of GSE direct and guaranteed debt is 40 percent larger than the federal government's debt," Poole said. He warned that if one of the government-sponsored firms came under a cloud, there could be a "contagion" impact with risk-averse investors viewing all the GSEs much the same.
"I do not see any immediate risk of a GSE debt problem, but am not willing to assume that in different conditions in the future one could not occur," the St. Louis Fed chief said.
"There is no doubt that a high level of debt increases the risk of financial instability," Poole said. "Firms fail when they cannot pay their bills."
Poole said the credit lines the GSEs have with the Treasury Department should be withdrawn, adding that they could be replaced by credit lines at commercial banks.
In addition, he said the companies over a period of years should add to the amount of capital they hold. He said both Fannie Mae and Freddie Mac hold a level of capital "well below" what is required of banks.
Poole also said federal tax law could be changed so that it no longer encourages the issuance of corporate debt over equity, which he said it currently does because companies can deduct interest paid on debt but not dividends paid on stock.
simmonsrandal, I use QuoteTracker (there is a free version at www.quotetracker.com) with Datek for my stock quotes feed & Quote.com for my Index feed. I keep multiple Island Level I windows open (also a QT feature) and can see pre-market trades on those. There is also an Indices panel on QT that you can edit - you can "user-add" the futures you're interested in. And... if you double-click on those futures (on that Indices panel), you'll get a nice (almost real-time) chart that even works pre-market. Hope this helps... Jan
anyone know of a good source for live premarket quotes and index futures?
Much thx and happy trading!
Updated 7/31/2002 The Great Real Estate Debate
http://www.elliottwave.com/features/marketreport/default.htm
As the bear market in stocks continues, "experts" and investors alike are singing the praises of real estate. The country's largest financial daily chimed in with this headline: "Find Some Solid Ground With Real Estate Funds," in a story claiming "It's safer on land."
The article also asserts that real estate investments "hold up during a stock market crisis," and even outperform over the "relatively long-term."
Of course, the "relatively long-term" is conveniently defined as 10 years -- the current length of real estate's bull market.
But it gets better: "A number of analysts say there's little evidence of a looming real-estate price bubble."
Two questions:
1) Are these "analysts" the same ones who chattered about the "new economy," and who insisted that there would not be a recession?
2) Does the recent 25% increase in home prices vs. a 4% increase in income count as a LOT, or as a "little evidence of a looming real estate price bubble"?
Finally, this story says that "a couple of [real estate] funds that interested us have closed their doors to new investors" and says that's a sure sign of --are you ready -- "a hot sector."
That's what the "analysts" and the media were saying about small cap stock funds back in March -- just before the S&P Small-Caps 600 Index began a decline of some 30%.
A second opinion -- one that's objective, mind you -- is in order, and it so happens that the August issue of The Elliott Wave Financial Forecast speaks directly to the question of safety in real estate.
Here's a special excerpt:
The abandonment of stocks for the safety of real estate is another move that is destined to leave investors feeling a lot like the inmate who escaped jail only to swim straight into the jaws of an alligator.
As the May issue of EWFF illustrated with a chart of the Dow and major real estate collapses since 1835, important stock peaks like that of January-March 2000 are inevitably followed, sometimes with a 2-year lag, by periods of sharply falling real estate prices. The case for an imminent real estate collapse is stronger than ever.
In addition to the sense of relief that investors are feeling as they sell stocks to buy relatively illiquid real-estate assets, a resounding top signal is available in the surging number of Americans getting licenses to sell real estate.
According to the Association of Real Estate License Law Officials, the big increase since the end of 2000 is the first since the late 1980s, right before the last real estate disaster.
Another sign that real estate is about to copy the experience of 1837 and collapse two years after a Supercycle-degree stock peak is the recent performance of the homebuilding stocks. In May, EWFF cited a reversal in Centex Corp., a stock that is representative of the homebuilding sector.
After falling in five waves in wave (1), Centex retraced 76.4% in a wave (2) three-wave rise and is now in a wave (3) decline. At the same time, Bloomberg's homebuilding index has collapsed 30%.
Another stock that EWFF has been tracking as a proxy for real estate is Fannie Mae. In March, we were looking for one more new high, but Fannie's break of 75 suggests that it has also entered a long-term decline.
By many accounts, home prices are still rising at rapid rates, but the impulsive form of the declines in Fannie Mae and Centex suggest that the displaced speculative forces of the long bull market are now waning and that the brutal, multi-year real estate downtrend is underway.
The fate of the real estate market is closely tied to what's next in bonds, interest rates, unprecedented debt levels, and deflation. Few people understand how closely related these issues are -- even fewer understand what deflation will do to the average investor.
EWFF realizes both the danger to the uninformed, and the opportunities for investors who prepare now. See the difference for yourself in the current issue by following the steps below.
Near-Term Turns + Long-Term Trends = Big-Time Opportunities
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bought QQQ21.90, sold that position into close 22.20. Action on SOX appeared corrective off LOD, still a little above that 8yr log chart trendline, maybe market hits it Monday/Tuesday.
buying Q's at 21.90 or slightly under
A section from this morning Pre-Market............
I am expecting slightly down opening this morning then a potential for the dip buyer to come in an attempt to buy...however unless we see some support from today's economic reports, I do not believe they will have the juice to make the rally last. Factory Orders are due out at 10:00 EDT this could also affect the market direction...I will be watching these numbers.
I am expecting that we could see a tick down in the unemployment rate today, due to the previous pro forma numbers we have been receiving all month. this could be an excuse to expound upon for a rally. However I believe the numbers will be revised eventually...If they report actual unemployment it should come in worse than expected my forecast is 6.1-6.2%. Non-farm payrolls will also be a potential market mover.
Merrill's chief U.S. Strategist Richard Bernstein said his indicators were deep into "sell" territory in a note to clients. He said, "Even though investors are becoming increasingly aware of the problems confronting the stock market they remain far from the psychological state of capitulation that would signal a bottom. Also, stocks are not cheap when considering low interest rates and inflation. Investors are ignoring that the S&P earnings growth is the least predictable and the most variable as anytime in the last 60 years."
Today we see that Investors continued a mass exodus as the fled a grim US stock market in July, with early industry estimates suggesting that some $47-50 billion was pulled out of equity mutual funds the largest net monthly outflow in history, according to new data. The forecasts have raised concerns that investors are losing faith in equities and could further upset an already volatile market. Investors already pulled out over $18 billion from equity mutual funds in June as the stock market slid down the slippery slope, compared with a about $5 billion net inflow in May, according to the Investment Company Institute (ICI), the mutual funds trade group. AMG forecasts a net outflow of $31 billion for the four weeks ending July 24th, based on those mutual funds that report on a weekly basis. www.TrimTabs.com which tracks about 15-20% of all funds on a daily basis, was due to release official July estimates late yesterday…I haven’t seen them yet but a spokesman said equity fund outflows could be above $50 billion. Funds investing in U.S. equities took in $900 million in new money during the week ending July 31st, estimates Carl Wittnebert, director of research at Trim Tabs. That compares with outflows of $18.5 billion during the previous week.
I expect that after this recent round of very negative economic news this week that we will see more out-flows in the following weeks. The picture is clear. Despite the lowest interest rates in 40-yearts and a FED that continues to pump money into the market by multiple billions every day the economy and the markets are still falling. According to the fed-futures there is nearly a 50% chance of another Fed rate cut at the August meeting. I sure hope not…as the FED has already killed the fixed income group. However many anal-heads are saying this is assured. If it happened it in my opinion would be viewed as desperation cut because the economy is worse than we thought, and it could tank the markets, sure Uncle Al (if he does so) will try to spin it as an "insurance" cut but please do not be fooled. This would be an awful signal.
I am going to predict that we continue to see news flashes that convey that CFO’s and CEO’s are retiring and leaving their firms, instead of signing in blood before the 14th of August.
Let’s face it folks with new criminal penalties for financial misstatements, and the general public out for blood, along with the political gun touting politicians that are coming up for re-election running amuck the running of multi-divisional companies with far reaching operations is getting extremely difficult and having to certify the accounting for thousands of employees is suddenly not a highly sought after position. Couple that with officer salaries getting ready to plummet, along with lucrative option packages about to become extinct as stockholders become more involved, the risk- reward ratio is not what it used to be. Hence I be we start to see an exodus. After the close yesterday it was announced that the Tyco CFO and General Counsel were leaving the company, Tyco CFO Mark Swartz and General Counsel Irving Gutin are leaving the company. According to many analysts the CFO is the only one besides ex-CEO Dennis Kozlowski who really knew what is happening inside Tyco.
There was a huge cloud of rumors surrounding CSCO yesterday…several alluded to John Chambers, CEO of Cisco, was going to resign rather than certify statements. There was also a rumor that the CFO Larry Carter had refused to certify their statements due to a vast number of issues that have not been resolved. Many traders are also worried that CSCO will announce a huge house cleaning party with their next earnings to dump some prior problems so they can certify for the next quarter. Cisco has a July 28th year-end so they don't have to certify until October. The Rumors helped CSCO to drop -1.13 on volume of 132 million shares yesterday.
After the bell yesterday Mickey and Friends "Disney" announced estimates that just meet the street’s estimates then however they warned of slowing bookings for the current quarter by 6% -10% for the fourth quarter. This to me folks is an advance sign that the average consumer is being more cautious in their discretionary spending and should be a leading indicator for economists to understand that consumer retreat has begun, the real worry will be weather this retreat turns into a full scale hibernation.
We also saw that National Semi (NSM) warned after the bell that weaker than expected order rates for personal computer products and related accessories like monitors have impacted their estimates. One bright spot was that they stated that orders for the following quarter were building now that the merged Compaq and HWP were placing orders again. This follows the heels of the NVDA warning earlier in the week and could mean problems for AMD/INTC/MU before this quarter is out again.
Best of Luck
Steve
If you want the full boat...go to
http://www.twaves.com/T-Waves_Subscription_Prices.htm
And take the 2-week free trail
NASD Threatens Suit Over the Siedle Directory of Securities Dealers
http://www.benchmarkalert.com/library/alerts/0302.html
The Siedle Directory of Securities Dealers, scheduled to be released in May, may never be published if the National Association of Securities Dealers has its way. At 10:12 p.m., Friday, February 22, 2002, we received a letter via facsimile from the NASD, the so-called "self-regulatory organization" representing brokerages, indicating that if we publish the Directory, "the NASD will pursue all legal remedies available to it." We were shocked to receive this letter because in July and August, 2001, we wrote several letters to the NASD and the SEC describing the Directory and inquiring whether they would oppose its publication.
On October 2, 2001, the NASD had responded that they would not object to the publication. Once we had collected all the data, written the book and were negotiating a publishing agreement, apparently the NASD changed its mind.
The two letters we received from the NASD, as well as a Wall Street Journal article describing the case, are available here:
NASD October 2, 2001 Letter
NASD February 22, 2002 Letter
Wall Street Journal Article: A 'Tell All' Book On Brokers Gets NASD's Thumb
What in the Directory is so disturbing that it would lead the NASD to threaten litigation?
The Directory provides retail and institutional investors alike with critical information regarding the integrity of all brokerage firms registered with the National Association of Securities Dealers, Inc. We believe the information provided in the Directory will assist investors in their determination whether to conduct or continue to conduct business with an NASD member firm. For the general public, a review of brokerage firms prior to investing and on an ongoing basis, makes sound financial sense. For fiduciaries involved in brokerage decision-making, such as money managers, pensions, endowments and foundations, regular review of the brokerages they entrust with assets, is mandatory.
As of December, 2001, there are were approximately 5636 NASD member firms operating in the U.S. and 673,822 licensed brokers. Like banks in the past, today it is brokerage firms that are primarily responsible for handling the nation's wealth. Yet there is a dearth of information regarding these firms. The Directory was created to respond to the public's need for comprehensive information involving NASD member brokerage firms. The Directory provides investors with important publicly available data regarding certain criminal charges and convictions, regulatory actions, civil judicial actions, and certain financial actions, such as bankruptcies, unsatisfied judgements or liens. By providing this and other information pertaining to all NASD member firms in a single place, available for simultaneous viewing, investors are able to compare and contrast firms, as well as garner information about the industry generally.
Why would the NASD oppose publication of this Directory? The Directory serves a laudable public purpose of educating investors. Giving investors more information regarding brokerage firms can only be helpful. The core information in the Directory, the disciplinary histories of the nation's brokerages, is required to be disclosed to the public under the federal securities laws. No one owns this data, least of all the NASD. We certainly never sold the disciplinary data regarding this firm to the NASD, nor did any other brokerage firm. In addition to the disciplinary data, the Directory provides investors with an overview of the brokerage industry and a methodology for analyzing brokerages. The Directory will give investors far more information than the NASD's Public Disclosure Program.
In our opinion, the NASD's existing Public Disclosure Program is designed to keep investors largely in the dark about brokerage industry disciplinary norms. The NASD Program permits investors to only view information about one firm at a time. Furthermore, information regarding the largest brokerages is only provided via ordinary mail, too late for an investor to review prior to making an investment decision. There are many other questions involved with the NASD's Program that the NASD's staff is not trained to answer. In short, the Public Disclosure Program actually misleads investors into believing the risks related to doing business with brokerage firms are far less than they really are.
Who was the NASD speaking for when they threatened litigation against us? According to our analysis, the majority of the brokerage firms that are NASD members, such as this firm, have no adverse disciplinary disclosures. If the majority of NASD member firms have nothing to hide, how does the NASD know its membership opposes publication of the Directory? The NASD seems most concerned about exposure of those firms with the greatest disciplinary problems. We are not aware of any public benefit related to permitting these firms to hide their dirty laundry.
Should a self-regulatory organization be permitted to have the final word on what information about its membership is made public? We don't think so. Talk about letting the wolves guard the sheep! Self-regulation of institutions that handle the public's wealth is absurd. We don't let money managers regulate themselves. Are brokerages especially trustworthy and deserving of the right to self-regulate? We don't think so. The NASD should step aside and let those who are truly concerned about protecting investors get all the information about brokerages in the public's hands. By the way, what's the SEC, the government agency whose mandate is "the protection of investors" got to say about all this? Thus far, we haven't heard a peep.
Misdeeds of Nation's Stockbrokerages Under-reported Says New Reference Guide
http://www.benchmarkalert.com/current/
Lighthouse Point, Florida (July 29, 2002) The findings of the first edition of The Siedle Directory of Securities Dealers, a reference guide providing information regarding the integrity of the nation's stockbrokerages, were released today indicating widespread under-reporting of disciplinary actions involving stockbrokerages. Edward Siedle, a former SEC attorney who authored the study said, "The brokerage industry is unique. It has been permitted to self-regulate, self-insure, self-adjudicate and even control the information the public receives about brokerages. The conflict of interest inherent in self-regulation may well explain the massive under-reporting we uncovered."
To summarize The Directory's findings:
Data regarding millions of nationwide brokerage firm customer complaints is not disclosed to the public, despite the fact that state securities regulators, the SEC and National Association of Securities Dealers, each keep such records.
Only information regarding arbitration cases filed with the NASD is disclosed to the public. Arbitration cases filed elsewhere, an additional 10-15% are not disclosed-- although information regarding these cases is available. Cases ending short of a final decision by arbitrators are not disclosed. Cases decided by arbitrators that are subsequently "expunged" from firm records as a condition of settling claims are not disclosed. Arbitrations between brokerages and their employees and between firms are not disclosed. Only 15% of all NASD arbitration cases filed are disclosed -less than two arbitrations per firm over a 15-year period.
Only one-half to a third of regulatory actions are disclosed to the public. Only two criminal actions and no bankruptcies are disclosed for the entire industry. Data regarding firms that become insolvent, are expelled or otherwise cease business operations is removed from public disclosure within two years. "This removal policy ensures the disclosure system is purged of its most damning statistics," said Siedle.
"These findings indicate the industry's efforts to educate investors regarding the risks of doing business with brokerage firms are woefully inadequate."
The National Association of Securities Dealers, Inc. is attempting in litigation in Florida to thwart publication of The Siedle Directory which details the disciplinary histories of its members.
"The very fact the publication of this book has been so strongly opposed by the industry's so-called "self-regulator" should be enough to convince even the most skeptical of the need for change," said Siedle.
The 1600-page Directory provides data regarding criminal, regulatory, civil, and financial actions involving brokerages and sells for $850. For more information go to benchmarkalert.com.
Contact: Edward Siedle, Esq.
The Siedle Directory of Securities Dealers, Inc.
(954) 784-6282
Stephen-You nailed the turn today. Good call. Now for a hat trick, do you have a good guess on closing QQQ for Friday P:M for over weekend?
34Simmons
Thanks, sarai - interesting...
Jan
Prechter:
The data regarding "Monday's confirmation of a breakout" and comparison to the early 1930's action with 42 different instances of such BEAR MARKET breakouts wherein the DOW was lower a week or two later.
Treasury Wants to Fix Reporting Gaps
By Rebecca Christie
Dow Jones Newswires
Wednesday, July 31, 2002; 7:11 PM
WASHINGTON –– The U.S. Treasury wants more information from very large bondholders so it can detect market manipulation more easily, according to a new proposal published Wednesday in the Federal Register.
Treasury put forward changes to its "large position reporting requirement" rule, which governs irregular surveys of the largest holders in Treasury securities. The change was also announced as part of Treasury's quarterly refunding policy announcements.
One of the biggest changes in the new rule eliminates exemptions that previously allowed some large holders not to file. Last summer, when Treasury conducted its most recent test call of the reporting system, one large holder used the loophole to get out of filing a report.
In the past, this loophole may have been abused by holders who stretched the definition of when it should apply, the proposal said. A Treasury official said that last summer's test call was one of the main catalysts for the proposed changes.
"With a test report, the idea is to see if we get what we want. It didn't seem to do that fully," the official told reporters in a background briefing Wednesday.
The official said no holders broke the rules in last year's test call. "Everyone who responded complied with the rule as required," the official said. However, Treasury is now trying to be more clear about what the information it wants, he said.
About 10 large bondholders will be required to take part in the large position reports and related test calls, Treasury said in its proposal. It said the extra information should not create an undue burden, even though it will require more work on behalf of survey respondents. The calls apply to those who hold $2 billion or more of a given securities issue.
"We would like to reiterate that large positions are not inherently harmful, and that there is no presumption of manipulative or illegal intent on the part of the controlling entity merely because its position is large enough to be subject to Treasury's rules," Treasury said.
Comments on the proposed rule are due by Sept. 16, 2002.
Under the new rule, securities holders would need to include more specific data on their net trading position. Besides submitting the total position, holders would need to break out each of the five components that comprise that total.
Holders also would need to submit more information on their exposure to "fails," or incomplete transactions. Current rules require large holders to report on their net fails position; the changed rule would also require information on the gross par amount of outstanding fails.
Another change covers holders' gross financing position, an overall account of their holdings. The proposed change would require holders to break out repurchase-agreement and reverse-repurchase-agreement portfolio components by maturity classification and duration.
Exemptions connected with the gross financing position would be eliminated under the new rule. Treasury is particularly concerned with the so-called "right to substitute" securities that are subject to certain custody conditions.
"We are particularly concerned that in certain situations a market participant might be relying on the 'right to substitute' provision ... in cases where the counterparty may not have a remaining, immediate, exercisable, explicitly documented right to substitute securities with respect to the particular transaction," Treasury said.
Treasury is interested in all comments on the proposal, the department said.
© 2002 The Associated Press
For the astro buffs, turn times:
http://www.wealth-and-success-thru-astrology.com/dt/turningpoints.htm
Ash Crawford on a sustainable bull move:
CRAWFORD PERSPECTIVES
JULY 25, 2002
CONSULTING CLIENTS:
When the market gets this Emotional as we approach a FULL MOON, those emotions will Maximize at the FULL MOON +/- 3 days!
In addition the BRADLEY Model (totally astronomic) indicates a possible short term low on Friday +/- 2 trading days.
Bradley does NOT include Moon influences/correlations.
We were certainly right about the EMOTION of the Full Moon!
We were certainly wrong in our interpretation of directional effects.
WE ARE IN THE TIME WINDOW FOR A PROBABLE SHORT TERM LOW
There is a good probability that we had one, whether a retest of recent lows is required or not.
Possibilities for a further deep decline before this "window" passes remain, but are fading as time & price progress.
(e-minis are selling off before open -9.00 at 9:08edt)
So far, little damage has been done to downtrend lines and downtrending moving averages.
From the extreme oversold condition, the snapback resulted in the 2nd largest single day rise in DJIA points!
Attached chart of QQQ Hourly shows that no significant resistance area have been breeched.
That could change if the rally continues in force today or tomorrow.
Shortest term: We have been stopped out of our Hotline positions with tremendous profits.
Longest term: We will probably NOT disturb Long Term Short positions taken in the newsletter in early January and doubled up in early April.
Intermediate "Trading" term: That's where we need to focus, and be on our toes!
If our markets turn back down around 10-10:30edt (NY), we will add to Shorts...but KEEP VERY TIGHT STOPS.
We will add to Shorts on breaks of critical support levels on the way down, and cover portions on upside breaks of critical resistance. This may lead to some "whipsaws" in this highly nervous atmosphere. However, if the market takes off in one direction or the other, you will be properly positioned for it!
A less frenzied approach would be to cover shorts & ease into Longs gradually over the next few days (as an institution generally has to do), irrespective of the shorter swings. We believe this will leave you positioned for a decent "tradeable" rally into August.
The most comfortable way to meet this period is to Stay Out until new trend solidifies, as it may be very choppy here for a few days.
The Bradley Model shows a rally topping on or about August 10. Some choppy ups & downs, then Down Hard in September.
Although the Bradley can be a wonderful "rule of thumb" projection, we require technical confirmation before acting accordingly.
WE ARE CLEAR THAT NO SUSTAINABLE BULL MOVE WILL EVENTUATE UNDER PRESENT CONDITIONS!
On the attached QQQ hourly chart, you can see the area of the circle to the lower right marked "A" contains 2 moving averages (50-bar and 200-bar) in addition to 2 Trendlines. As a trader, One must have protective stops above such resistance areas!
There seem to be comparable resistance areas just above current levels on all major indices.
Good trading!
Arch Crawford
http://astrology.about.com/gi/dynamic/offsite.htm?site=http%3A%2F%2Fwww.astromoney.com%2F
PS: I will be interviewed by Ron Insana &/or Sue Herera on CNBC Thursday (today) 5:45edt.
*Once considered by the mainstream to be too "out there" or too excentric, the financial astrologers have had a decent track record, of late.
Sarai Great article thanks...I will reference it tonight
This was this morning's General Pre-Market 7/31/2002
I am expecting slightly up opening this morning then a potential bout of profit taking for those who stepped up and bought the last couple of days, as this ramp has been extreme. And not to lock in profits would be foolish in my opinion...disclosure I an short the DJX currently.
We need to be aware of the GDP numbers as they will be a definite market mover. We may also see the US Government revise the last several YEARS, yes years worth of GDP pro forma GDP numbers this could be a HUGE shock to the markets as well. There has also been a strange move in the precious metal markets that usually move in opposite directions to the indexes.
I see several converging activities and issues for today’s market action. The giddy bulls are still chopping at the bit, they believe we have seen the bottom and there is clear sailing ahead, unfortunately the rose colored glasses they are currently wearing have been painted over in black. We are nearing the nose bleed levels again, where that air is thin. There is significant overhead resistance at these levels, even Art Cashin stated last evening that he expects a top between 8,700-8,850 and he still is one of the most respected names in the business, a man who has held onto to his integrity. I wonder how long this irrational outlook can last. The Qwest debacle was all over the news yesterday along with constant pictures of Merrill Lynch employees taking the 5th before congress. And we are quickly approaching the blood-signing date of August 14th not to mention that the rest of the week we have a slew of economic data that may derail this euphoria at a moments notice. Companies are making their EPS numbers many are beating them, but the majority are missing on their expected revenue and are warning that the ensuing quarters look flat to down. Many technology companies are still warning that orders are slowing and PC sales are dropping.
Where are the positive conditions that should be present of a continued rally. Still I must give the bulls credit as they stood their ground yesterday and really attempted to hold the high ground. I wonder if they know that the Dow has serious resistance between 8700-8800 and the Nasdaq has a huge line of overhead resistance at 1400. When the selling starts it could be intense as everyone expects to get off on the top floor and it just doesn’t work like that. The bulls really need a significant event to provide a spark for the next leg up…maybe
Bush will produce Osama’s head for the world to see, or better yet maybe they will lead him out in shackles to ring the NYSE opening bell.
I saw several sell programs yesterday and if we see no upward momentum today I would expect to see an upswing in sell-programs. The majority of the short covering rallies over the last few months have failed on the fourth day. And Folks this one was one of the biggest short covering induced rallies by far that I have ever seen, from severely oversold conditions. The Bears are sharpening their claws and honing their teeth, as today will be the magic fifth day.
We have what are historically the worse months ahead for the markets August/September, and I am wondering which institutional investor is racing out to commit new money to the markets. I am expecting that just the opposite will happen they will pull their recent profits and sit back to watch how this will hash out. Let’s face it they can book between 13-16% from the run up in the past week. What do you think they are doing? I believe that we have a retest in our immediate future and until that retest occurs we need to be constantly looking over our shoulder for the next big shoe to drop.
Goldman Sachs raises global equity weighting Goldman Sachs raises their global equity weighting to 65% from 60%, saying that global equities are very attractively valued relative to bonds; believes that the sectors most likely to lead the market turnaround are the higher-beta casualties of the downturn: technology, telecoms, and insurance.
The market’s shook off bad news yesterday that I believe may foretell of serious issues ahead. The Conference Board Consumer Confidence survey dropped much more than expected to 97.1 in July. The consensus estimates were for 102.0, down from 106.3 in June. This was the largest drop since October and the lowest level since February. The expectation component dropped even more, falling from 107.2 to 95.7. That is a huge drop. An amazing tidbit 37.7% of the consumers polled expected the markets to fall farther over the next 12 months. On the employment front jobs were seen as harder to get and the situation is getting worse. Cars and homes remained in demand (due to severely depressed finance rates) as consumers planning on buying them remained slightly improved while those planning to buy consumer goods like appliances and electronics saw a significant drop. This was not good news for the markets but for some reason the nitrous oxide seemed to be turned up on high as the giddy bullish investors shook the reports off as old news and attempted to rally into the afternoon. They even ignored the negative retail sales reports that showed that the consumer has stated to pull back. CSFB said a survey that they had taken of mall traffic showed that it had fallen in July and retail sales were significantly suffering. Wal-Mart and Target both have said sales for last week were under plan, and worth noting is that this was the third week down for Target.
As many of my long time readers know I have been writing about and predicting a double dip recession that could kick off in Q3 of 2002. Well I believe we are seeing more evidence pointing to that fact as the weeks and month go on. It appears to me that the consumer is now going into conservation/cocoon Today’s GDP report is expected to show growth of only 2-2.5% in the 2Q following the 6.1% 1Q surge. As we know the reason for the high Q1 number was due to an inventory replenishment, and inventory accounting issue. It appears the inventory cycle was over in the 2Q and final sales have also slowed significantly. A serious miss today on this extremely important number would be extremely detrimental to the indexes and markets as a whole and would have far reaching global affects. Some analysts are estimating numbers as low as 2.0-2.2%. T-Waves is expecting the Preliminary number to come in at 1.75-2.0% with a subsequent revision down to 0.75-1.25%.
Also due out today is the Beige Book. The Beige Book reports regional economic conditions and developments as well as providing indications of orders and shipments across almost all sectors except telecommunications. Last months report was not impressive at all, it showed some broad based weakness. The tone was one of modest but uneven growth, with some major sectors showing signs of improvement while others softened or remained weak. Retail sales were flat in most Districts, and auto sales were mixed. Activity in the services and manufacturing sectors improved overall but varied across regions and segments. Residential real estate markets generally remained robust while weakness persisted in most commercial markets. Districts noted few changes in lending markets. Labor markets remained slack in most Districts, but several Districts reported higher demand for temporary workers. Price pressures were in check for most goods and services, but many Districts noted rising steel prices and continued increases in energy and insurance costs. If this month’s report shows any weakness it could accelerate the double dip forecast and promote talk of an uncertain economic recovery.
We also have the Chicago PMI report due out today as you can see from the table below the numbers to not consistently indicate that activity is on the rebound.
Chips are a soft spot…
After the bell yesterday NVDA warned that its revenue and earnings for the just completed quarter would fall substantially below analyst expectations. They expect to report revenue of $410-$430 million compared to estimates of $568 million. NVDA had been stating all along as late as late as May that it expected revenue to rise 1% to 3% from the $582 million in the first quarter. Something went completely astray here. The NVDA CEO said weak PC sales overall, a larger mix of low budget sales vs. high-end sales and excess supply (lack of sales) contributed to the 30% plus shortfall. This is a huge drop just in the past several months and shows just how weak PC sales are. I would expect the box makers and some of the PC chippers such as AMD/INTC and MU may see some weakness today on that news. Remember just last week TSM warned that weakness in a number of sectors, including PC's and game consoles, had caused it to cut capital spending and would miss estimates.
Also out after the bell yesterday was KLAC and their earnings were not flattering at all. They said they had received bad news out of Taiwan with TSM cutting the capex budget by 25% and UMC, the second largest chipmaker, by 20%. Both firms are large customers of KLAC, not to mention NVLS and AMAT among others.
Today Christian Morales, Intel's vice-president of Asia Pacific, said the outlook for the semiconductor industry remained bleak despite bright spots in emerging markets.
Best of Luck
Steve
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Turn Times this week?
Hi Steve, have you had a chance to calculate the Turn times? Thanks, Jan
The Futures are pointing to an Down Open as I write this Pre-market out-look.
I am expecting slightly down opening this morning then a potential bout of profit taking for those who stepped up and bought the last couple of days, as this ramp has been extreme. And not to lock in profits would be foolish in my opinion...disclosure I sold the last of my calls yesterday into the close.
President Bush will sign the New Corporate Reform/Fraud bill today into law...if he was a man of integrity he then would turn around and sign a copy himself stating that the accounting of the good old USA was accurate and not riddled with strife...he should then require all congressional members to sign a similar report with regards towards the nations budget and their respective bills. Just a thought.
Fifty percent of the trading volume on Monday was due to index trading and not individual stock buying, which suggest that there is no conviction in any individual companies. Not a sign of conviction.
Merrill Lynch's (MER) Enron dealings could put company on hot seat today The Wall Street Journal reports that Congress is probing Merrill Lynch's "questionable dealings" with Enron. Article reports that, under pressure from Enron, Merrill Lynch replaced a research analyst in 1998 who had been critical of the energy firm with an analyst taking a more positive view on Enron. Congressional investigators also are exploring MER's role in raising funds for LJM2. Merrill's dealings with Enron will be a highlight of congressional testimony today.
I am now warning the BULLS, to be very careful...please lock in your profits...and protect them...I believe this rally is about to stall and take a breather. Remember the earnings tune of late is; "We beat the EPS target, but oh how our revenues were light, hopefully no one notices..."
NOTE: There have been some questions about the retracements that I have been using on the DOW ...I have used two different sets, hence I thought a picture may be of more use...see chart I hope this helps.
Since last Wednesday, the DOW has rallied, an astounding 1,180 points from the intraday low of 7,532. to close out today at 8,712. The Dow currently is 39 points over the 61.5% retracement level, and it has done so with two 400+ point rally days. The Dow is only a few hundred points away from the 75% retracement of 8,917. Normally the retracements are not so swift in nature...this has been like a stampede. In my opinion
I believe the DOW is in need of a rest. Last Tuesday the DOW was extremely oversold posting Slow Stochastics of 8.18 and Fast Stochastics of 1.10, in four short trading days the tables have turned, as the Slow Stochastics of 38.18 and Fast Stochastics of 73.68, hence the daily Dow chart is quickly approaching Overbought conditions. As you can see below both the 60-minute and 30-minute charts are very overbought as well.
The Dow 60 minute chart indicates Slow Stochastics of 97.18 and Fast Stochastics of 100 with an RSI turning a little south
The Dow 30 minute chart indicates Slow Stochastics of 96.88 and Fast Stochastics of 100 with an RSI turning a little south
Since last Wednesday, the Nasdaq has rallied,143 points from the intraday low of 1,192. to close out today at 1,335. The Nasdaq is currently is 5 points over the 61.5% retracement level of 1,350, I believe the Nasdaq is also in need of a rest. Last Tuesday the Nasdaq was extremely oversold posting Slow Stochastics of 14.05 and Fast Stochastics of 0.08, in four short trading days the tables have turned, as the Slow Stochastics of 27.88 and Fast Stochastics of 61.08, hence the daily Nasdaq chart is approaching Overbought conditions and it is bumping up against the 20SMA. As you can see below both the 60-minute and 30-minute charts are very overbought as well.
The Nasdaq 60 minute chart indicates Slow Stochastics of 97.07 and Fast Stochastics of 100 with an RSI turning a little south
The Nasdaq 30 minute chart indicates Slow Stochastics of 96.98 and Fast Stochastics of 100 with an RSI turning a little south
Since last Wednesday, the S&P has rallied,143 points from the intraday low of 1,192. to close out today at 1,335. The S&P is currently is 5 points over the 61.5% retracement level of 1,350, I believe the S&P is also in need of a rest. Last Tuesday the S&P was extremely oversold posting Slow Stochastics of 5.67 and Fast Stochastics of 0.80, in four short trading days the tables have turned, as the Slow Stochastics of 33.63 and Fast Stochastics of 68.24, hence the daily S&P chart is approaching Overbought conditions and it is bumping up against the 20SMA. As you can see below both the 60-minute and 30-minute charts are very overbought as well.
The S&P 60 minute chart indicates Slow Stochastics of 97.71 and Fast Stochastics of 100 with an RSI turning a little south
The S&P 30 minute chart indicates Slow Stochastics of 97.34 and Fast Stochastics of 100 with an RSI turning a little south
Today we get another glimpse into the minds of the consumers. Last month The Conference Board's Consumer Confidence Index declined four points in June. The Index now stands at 106.4 The Present Situation Index fell to 105.7, down from 111.2 last month. The Expectations Index fell to 106.9, down from 109.7. Weak labor market conditions, generally soft business conditions and waning public confidence in questionable business practices helped erode consumer confidence last month. Consumers' assessment of current conditions last month was less favorable as well. Those rating conditions as "good" dipped from 21.2 % to 20.1 %. Consumers rating current business conditions as "bad" rose from 18.5 % to 19.1 %. Those reporting jobs were "hard to get" increased from 21.8 % to 23.1 %. Those claiming jobs were "plentiful" decreased from 21.2 % to 20.1 %. The expectations are for a dip this month to a range of 101-101.50. Anything less will be seen as a negative, anything greater a positive. For what it is worth T-Waves projects the number to come in at 95-97
I was mystified yesterday at how quickly yesterday the bulls hunkered down and put lipstick on some of these boars, and embraced them as long lost lovers. J.P. Morgan was up almost $2.85 almost 13%to close at $25.10, while Citigroup gained $2.57 more than 8%, to close at $33.31. These two firms are still under a huge black thundercloud as Citigroup and J.P. Morgan provided the Senate with sworn affidavits as to the nature of offshore entities that were involved with Enron. These affidavits were requested last week by Sen. Carl Levin, who is chairing the subcommittee that is looking into the Enron scandal. From what I could tell, reading the information that was released both firms practiced the three-monkey excuse, as they expected the committee to believe that they knew nothing of the so called entities, however they respectively controlled the entities. What a sham JMHO. Citigroup and J.P. Morgan Chase officials on Monday denied that their firms controlled special purpose entities that lawmakers allege helped Enron inflate profits and hide debts.
weekend newsletter? turn times for this week? Steve did you send this out, did anyone else get them or am I the only one who didn't?
READ THIS: Any Bank of America customers out there? This is totally off topic, but I am pissed and need to vent.
Last FRIDAY at NOON a $2000 deposit was made to my BOA checking account. I have had this checking account for over 15 years - thru about 5 bank mergers which has ended up being BOA.
Deposits are made to this account like clockwork, for at least this amount and many times more $$.
Checking online this a.m., and I find the deposit is not showing up. Get out the receipt, check the receipt. Everything seems kosher. Call the 800 #, go thru two people before ending up with a supervisor, who proceeds to tell me:
Because a COUNTER deposit slip was used (happened to be out of deposit slips when I flipped my checkbook open) THE SUPERVISOR IS TELLING ME THAT MY DEPOSIT WILL NOT POST UNTIL WEDNESDAY AT MIDNIGHT!
What a crock of s h i t! Has anyone out there ran into this problem before?
Since when does it take from FRIDAY NOON to WEDNESDAY MIDNIGHT for a deposit to hit a checking account?
I'm not thru with BOA yet, but believe me that account is going to be closed and closed for good. I've got 2 other checking accounts and different banks, and NEVER have I had this happen.
All BOA customers - beware!
Wendy
Tetres, Do you still like AES as a value play? considering recent news.
Thanks
PM
SOX didn't make it to my target, but I did go long at QQQ22.08 yesterday, took profits this morning +0.5pts. Action off Wed low seems corrective to me, SOX might still make that 8yr log chart support line, more like 290-295 IMO, next week.
GREAT call Mr. USA I agree, I went long NDX and DJX, QQQ are killing me
SOX approaching 8 year log support trendline, about SOX300 or a tad lower! Could signal a higher low for other indices to rally off, assuming this is correct, I have interpolated NDX886/QQQ22.05 as that higher low level for this afternoon.
Today we should see a test to determine if the rally can hold or not this could once again prove to be an interesting trading environment. I am expecting a pull back this morning hence why I sold my OEX options into the close. I expect that the DOW could retrace to 8,020 - 8,050, the Nasdaq could retrace to 1260-1265, and the S&P could retrace to 822 - 826. The Bulls will need to protect these zone and add fuel otherwise the rally will be in jeopardy. Many Bears were Shorting into the rally yesterday starting around the zone when the DOW was 300+ up, hence they are under water, if the Bulls can-not get their act together BANG the Bears will feast again and laugh that this was just another short into the rally day. However if the build and gain traction after a minor retracement of lets say 15-20% the the shorts will get real skittish and they will start to cover which will add fuel to the rally.
Best of Luck to all
Steve
http://twaves
If you are interested in receiving The full T-Waves information as sent too subscribers each morning/evening along with intraday updates......visit the following link and subscribe...the first 2-weeks are a FREE trial, and you can cancel any-time (http://www.twaves.com/T-Waves_Subscription_Prices.htm
Folks I think we have to keep things in perspective since July 5th when the DOW closed at 9,379 and until Tuesday’s close we saw almost a 1,700 point loss, and if we followed that intraday to yesterdays low we saw a whopping 1,847 point drop in just 13 trading days, that is HUGE. The oversold spring was would so tight that it just had to give up some of its tension. What we saw was as predicted a bear market relief rally, so let’s revisit the Dead Italian Fibonacci and his famous retracement levels of 38.2%, 50.0%, and 61.8% hence we come up with 706, 923, 1,141. If we project these out from yesterdays intraday low of 7,532 we come up with targets for this bear relief-rally of 8,238, 8,455 and finally 8,673. Since we saw a DOW close of 8,191yesterday we are only 47 points away from the first significant resistant zone.
Yesterday I went out on a LIMB after having done considerable analysis on the markets and the various indexes and indicators I gave my very best call when I predicted a 70% chance of a decent relief rally. I was surprised at by the number of BEARS that responded to my call and warned me to be careful, as they were expecting to see DOE 7,000, and that my call could hurt my readers, they also thought that I was foolish for buying the close on Tuesday. It's a difference of opinion that makes for such enlightening exchange. The following were my reasons for making such a call yesterday
Yesterday's Prediction: The current oversold conditions are extreme for instance the S&P has now posted six days without a single stock making a new 52-week high amazing to say the least. Yesterday Down volume laid the smack down on volume on the S&P 5:1. Across all markets the decliners beat advancers 6100 to 1540, new 52-week lows were 1360 which exceeded almost exceed the post 9/11 terror event. This is a definite sign for me that we are near a tradable relief rally. Mr. VIX closed over 50 for the first time in the last five years. Make no mistake this is a high probability event. Normally a print over 50 occurs during high periods of FEAR While the VIX closing over 50 is a huge indicator…I must confess that I saw little confirmation when I reflected upon the NYSE TRIN or the put/call ratio. The TRIN at .80 and the put/call at .85 are not indicating an immediate relief rally. Hence I believe we may see a significant sell-off this morning before we see the pressure relief valve sprung. BTW: J if you want an old timers/experts point of view...Art Cashin said yesterday he expected a tradable bounce this week. When pressed he said +800-1800 points were possible
Yesterday started off as I thought we saw a continuation of the recent sell-off, and we sold off right into the area I had as DOW Support (See chart). We traded as low as 7532.66, before rallying back more than 650 points, all the way to 8,191.29. The Dow closed up a whopping 488.95 points, for the second largest point gain ever (I will confess I was looking for a 250-300 points on the first day of the relief rally, So even I was a bit shocked). Many think that a rumor that was flying around that Uncle AL might hold an emergency meeting of the FED to lower interest rates may have been the catalyst. This may have attributed for a small portion of the rally, however, not as much as folks alluded too.
For those that follow treasuries (as an indicator) like myself you would have noticed yesterday that the 5-year bond yield of 3.30% was hit, which is an EXTREME resistance point…thus I believe that once that level was achieved we saw several buy programs being triggered in the equity markets as institutions were rotating cash out of bonds and into stocks. I believe that many institutions moved their cash, generated from selling stocks, into bonds, earlier this year when the yield was higher, when the yield dropped yesterday morning I believe many institutions decided to lock in their gains, and shift back to stocks.
Morning Folks
I expect the following today...before the relief rally regains traction
I expect an NDX retracemet to 929-931 as the first line in the sand,then if violated to the 38% retracemant which 917-920
On the QQQ's I expect a retracement to $22.86 - 22.88 then if violate to 22.33-22.36
I expect that the DOW could retrace to 8,020 - 8,050, the Nasdaq could retrace to 1260-1265, and the S&P could retrace to 822 - 826.
The Bulls will need to protect these zone and add fuel otherwise the rally will be in jeopardy. Many Bears were Shorting into the rally yesterday starting around the zone when the DOW was 300+ up, hence they are under water, if the Bulls can-not get their act together BANG the Bears will feast again and laugh that this was just another short into the rally day. However if the build and gain traction after a minor retracement of lets say 15-20% the the shorts will get real skittish and they will start to cover which will add fuel to the rally.
Best of Luck to all
Steve
http://twaves
If you are interested in receiving The full T-Waves information as sent too subscribers each morning/evening along with intraday updates......visit the following link and subscribe...the first 2-weeks are a FREE trial, and you can cancel any-time (http://www.twaves.com/T-Waves_Subscription_Prices.htm
steve, i cant get the links you sent me to work. maybe it is my windows me. the emails you send out cover everything in the links, right? if they do, then i will worry about the links later. thanks, jim
ARIEG Sorry I will get better, I have the information in my head...and I have a programs that highlights it for me...
I will try to be more specific in the future
Tough to tell right now maybe a 38% - 50% retracement off the lows
On CPN I might average in @ 25% $3.30 / 25% $3.20 / 50% $3.10
On MIR I might average in @ 25% $3.15 / 25% $3.05 / 50% $2.90
I hope this helps
Steve
Steve! Buy on the dip is almost a bad joke. Seriously? what kind of a retrace are you looking for. Just saw 50% on the Dow / S&P as I write this, and we're going up again. Appears my message just went obsolete.
I was stopped out of ILA this morning what a whosh... I have another order in at $4.62
Steve, are you buying more ILA here? TIA
I am Going out on a limb…and confirming today that we have a 70:30 chance for a relief rally today, The current oversold conditions are extreme for instance the S&P has now posted six days without a single stock making a new 52-week high amazing to say the least. Yesterday Down volume laid the smack down on volume on the S&P 5:1. Across all markets the decliners beat advancers 6100 to 1540, new 52-week lows were 1360 which exceeded almost exceed the post 9/11 terror event. This is a definite sign for me that we are near a tradable relief rally.
Mr. VIX closed over 50 for the first time in the last five years. Make no mistake this is a high probability event. Normally a print over 50 occurs during high periods of FEAR While the VIX closing over 50 is a huge indicator…I must confess that I saw little confirmation when I reflected upon the NYSE TRIN or the put/call ratio. The TRIN at .80 and the put/call at .85 are not indicating an immediate relief rally. Hence I believe we may see a significant sell-off this morning before we see the pressure relief valve sprung. BTW: J if you want an old timers/experts point of view...Art Cashin said yesterday he expected a tradable bounce this week. When pressed he said +800-1800 points were possible
Now for the BEARISH point of view: As you know I attempt to put forth a balanced approach
How many more corporate scandals loom on the horizon like we saw yesterday with Citigroup/JPM
Anal-heads are now starting to predict that the recovery may not even occur in 2003. Eventually they will get it right. We already know 2002 is in the toilet and has been flushed but now 2003 is being called into question.
How big will the pre-fall-out of August 14th blood signing certification event be?
How much will the markets be impacted by the change in earnings reporting methods and the issues about expensing of stock options?
We have seen almost 1700 points sliced off the Dow in the last 12 trading days, the spring is wound very tight. So we could see a 1-4 day relief rally, before giving into the extreme downward pressures again…or until the bulls run out of fuel…they will be helped by Shorts running to cover. With no significant economic releases or corporate events today we could see a relief rally today of 200-300 points once the initial sell-off abates. If you reflect upon the recent NYSE volume the past 3-4 days it has been almost 2x normal...hence some stealth capitulation in my opinion. I believe we need to relieve the pressure then brace for one more leg down prior to 8/14/02 the date CEOs & CFOs will sign in blood.
MRK announced after the bell yesterday that they are planning on buying back up to $10 billion of their stock. This would be about 10% of their current market capitalization if they followed through with the planned buy back. They also declared a dividend of $.36 cents. This should help the DOW today as the "buyback" crowd moves into MRK stock.
In the trading forum I belong to there was quite a bit of turmoil at the close as many stocks especially MSFT was trading like crazy we were all trying to find out what was happening to MSFT as it traded almost 55 million shares in the 20 min after the close. The mystery of the huge volume at the close has been disclosed. It appears the Nasdaq was testing a new trading platform and it dumped the entire days trading volume back into the network at the close. What a MESS
I had several email asking about confusing earnings reports…well hang tight, as it may get worse before it gets better…First Call and Merrill Lynch said they would start tracking only GAAP earnings for companies they follow. Thus the firms can report pro forma results they want but they will be required to post GAAP earnings as well. In the beginning this will create confusion, and most likely plunging stock prices, however it is intended to level the playing field and many. So be very careful if you hold "pro forma or EBITDA" companies as they will suddenly look much worse when their GAAP earnings are released and investors really see what the bottom line is. Those companies that report other than GAAP are going to be under serious pressure to clean up their act immediately or investors will see that they are reduced to the pink sheets.
Hi Steve, Your 2:15 - 2:30 time call yesterday was good in my book!
Got any for today?
Jan
mr usa, pretty sweet entry, hopefully we get a good bounce sometime here. good luck
hit target on QQQ, long 22.32
steve, i agree it would be a gamble, and probably wont do it. just a little revenge for buying and holding the crap down to 5.58. thanks for your advice.
hobo1 that would be a gamble and if you have money to gamble with it could be OK
The time premium may be sucked out befor you make a dime... You would want to try to get hit on the bid, as we are looking at a 40% spread.
I certainly would look to cover at $0.30 - 0.35 as each
Best of Luck
Steve
Hello Samcook1, I have not received any confirmation from paypal at all...I just checked...
You may want to visit my website page
http://www.twaves.com/T-Waves_Subscription_Prices.htm
And try again
Best of Luck
Steve
Mr. USA I have a bottom for NDX at 894-897 at 2:15 - 2:30 on a time wave.... my call yesterday fizzled...however we did pop almost 250 points off of the turn...
I also am confirming the OEX at the same time level range = 396-401
Best of Luck
Steve
FWIW...Steve, your thoughts? Thanks for your contribution.
Lurker here! :)
C, the largest US financial institution, and JPM (no surprise there) are in serious trouble today. They are being dumped in wholesale liquidation fashion. This is very, very significant, and has to do with undisclosed liabilities (and ENE). The BKX is poised to take out the 1998 Asian Contagion lows, also extremely significant. Is it that the credit derivative market could go down like dominos? The use of credit derivatives has increased exponentially over the last several years. It is an unregulated, or good ol'boyz regulated, and little understood market. We all know the status of pop financial reporting. Anyway, C being down 13 or 14% is bullish for nothing, and could be indicative of serious structural flaw in the financial/credit markets. We already understand the market bubble and carnage are the product of systemic flaw. Don't be too quick to say this is "overdone", and "oversold" may be way, way premature...
We shall see...
Official: Banks Aided Enron Schemes
Tue Jul 23,11:17 AM ET
By MARCY GORDON, AP Business Writer
WASHINGTON (AP) - Multimillion-dollar loans to Enron Corp. by big investment banks helped the now-collapsed company conceal its true financial condition, and the banks were aware in some cases that Enron was using questionable accounting, a Senate investigator testified Tuesday.
After reviewing a million pages of documents and interviewing dozens of witnesses from Enron and its Wall Street investment banks, a Senate panel found that some banks actively aided Enron in its dodgy accounting in return for big fees and favors in other deals, Robert Roach told a hearing.
"The evidence indicates that Enron would not have been able to engage in the extent of the accounting deceptions it did, involving billions of dollars, were it not for the active participation of major financial institutions willing to go along with and even expand upon Enron's activities," Roach said at the hearing of the investigative panel of the Senate Governmental Affairs Committee ( news - web sites).
There also is evidence that some of the banks "knowingly allowed investors" to rely on Enron financial statements they knew were misleading, Roach said.
The banks used complex financial schemes to boost Enron's anemic cash flow to match its profit growth on paper, according to lawmakers. The energy-trading company recorded the money from the bank loans as prepaid trades of natural gas and other commodities with an entity based in the Channel Islands off Britain.
He said that Citigroup Inc., the nation's largest financial institution, and J.P. Morgan Chase & Co., also pitched the schemes to other companies.
Citigroup "shopped" the Enron-style schemes to 14 companies, successfully selling it to at least three, Roach testified.
Houston-based Enron, which filed for bankruptcy in December, taking the investments of millions of people with it, used a web of thousands of off-balance-sheet partnerships to hide some $1 billion in debt from investors and federal regulators.
In a 1998 e-mail, a J.P. Morgan Chase executive in Houston wrote that "Enron loves these deals."
Enron officials "are able to hide ... debt" from Wall Street analysts, he wrote.
Before senators heard the testimony, they decried the wave of accounting scandals rocking investors' confidence and the markets. In the latest move, telecom giant WorldCom Inc. filed the biggest bankruptcy in U.S. history on Sunday, less than a month after it disclosed that it hid nearly $4 billion in expenses through deceptive accounting.
"It's clear that Enron was not alone in shady financial dealings," said Sen. Jim Bunning ( news, bio, voting record), R-Ky. "Americans across this country are watching their savings and their pensions dwindle."
Spokesmen for the two financial companies couldn't be reached for comment Monday night. They have previously denied any wrongdoing, saying lenders shouldn't be held responsible for how borrowers such as Enron recorded their loans.
Citigroup has called the transactions with Enron "entirely appropriate at the time based on what we knew and what we were told by Enron."
J.P. Morgan Chase has said they were "properly accounted for by our firm and Enron."
Enron's Washington attorney, Robert Bennett, told the Times that he didn't know about the secret oral agreement, but said he was "unaware that those financial institutions did anything wrong."
Bennett has said the company would continue to cooperate with investigations by Congress, the Justice Department ( news - web sites) and the Securities and Exchange Commission ( news - web sites), and that people should not "rush to judgment."
In April, Enron shareholders who had sued the company for allegedly defrauding them added nine investment banks, including Citigroup and J.P. Morgan Chase, that financed the schemes to their suit in federal court in Houston. The shareholders said the banks' knowledge of Enron's questionable partnerships and other transactions gave them an inside view of the company's financial condition as they sold Enron securities to investors.
The other banks named in the suit were Credit Suisse First Boston USA Inc., Canadian Imperial Bank of Commerce, Bank of America Corp., Merrill Lynch & Co., Lehman Brothers Holding Inc., Britain's Barclays Bank PLC and Germany's Deutsche Bank AG.
The Justice Department last month charged three former British bankers with wire fraud in an alleged $7.3 million scheme involving Enron, in which they were said to have secretly invested in Enron entity Southampton LP through a series of financial transactions.
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