CLOSING WHIP

Markets closed mostly higher after with the DJIA +15, NAZ +0 and SPX +1.

Strong sectors were semis, real estate, defense, drugs, oils, small cap growth and brokers led by GS.

Weak sectors included internets, homies, metals, gaming and airlines.

Market internals +600 on the NYSE and +300 on the NAZ.

OEX/NDX /SPX all closed about 3/2 green.

Volatility indexes closed lower and now sit about 13% under their respective 10 day SMA's. That, combined with a 2 day RSI on the SPX near 80 gives me more of a "do not buy" then a sell signal; and if we do approach the 1,415 area, SELL. And if we get back to 1,390, BUY. That is how I anticipate playing for now.

CHOPPING

Markets continue to chop around after the futures filled the morning jobs related gap higher. The DJIA +28, NAZ +4 and SPX +3.5.

Strong sectors include semis, real estate/reits, oils, the Aussie market, defense, small caps, drugs, small cap growth, software, trannies and airlines. Lower are internets on the heels of the YHOO news, homies, retail and gaming.

Market internals have improved and now show +900 on the NYSE and +500 on the NAZ.

The OEX 75/25; NDX 65/35 and SPX 340/160 - UP to DOWN.

IBD 100 about 70 up and 30 down.

The brokers and exchcanges are trading mixed while GOOG and BIDU are red and AAPL is green.

Volatility indexes heading lower again and trading about 13% below their respective 10 day SMA's.

This doesnt look like an area to get aggressive with the longs as I don't expect a great close to the day.

Larry Conners, the founder of TradingMarkets.com and the author/co-author of some terrific trading books including Street Smarts and How Markets Really Work, is out with a new Blog. The first entry deals with something I have discussed many times, buying lower and selling higher. He says forget the TV guys (Cramer), go with the stats, and he does have some interesting numbers that kind of prove his point.

THE FLEECE

Markets rallied on the heels of the jobs numbers but have since turned back giving up much of the gapped gains and futures have turned red as I type (slowwwwwwwwwly). Buying Friday gaps, probably not a great idea.

Strongest sectors include semis, reits, trannies, software, defense, drugs, airlines and small cap value- Weakest are internets, silvers, homies, biotechs and brokers.

Market internals started very strong but have since flipped to +400 on both the NYSE and NAZ. The OEX/NDX/SPX combo all about 60/40 after starting the day 85/15.

Key stocks are generally red with MER MS BSC LEH CME NYX AAPL and BIDU leading lower. I will take the action in the brokers (all red cept GS) as a pretty ominous sign for the day.

Also, note the SPX again tagged the 1,410 line and maybe I will be about 5 to high with my 1,415 target on a short term top.

Buying Friday gaps not a great strategy, even worse when the VIX/VXO combo is trading about 15% below the 10 day SMA's, and down we go as the pre market buyers get fleeced.

STRAIGHT UP

Jobs numbers came in right at/near the targets at 97k v 100k consensus and a sigh of relief from traders sent the futures ripping higher (SPX +7 and should open near 1,409).

Rate on the 10 year Bond up to 4.58% and the new chance of a Fed rate cut down to one third and back to the goldielocks economy;

And don't forget about yesterday's news on NEW and Wednesday's comments from the CEO of DHI with his forecast on the homie market for the rest of 2007. Or my forecast for a near term SPX target of 1,415, about halfway between the recent lows and highs.

On the wires:

DCX may have a new bidder for Chrysler- Centerbridge; FDX/TXN upped to Buy at Stifel; PG kind of reaffirms guidance; AAPL initiated with a Buy at WR Hambrecht - tgt of $110; SCHW upped to outperform at Bernstein;

Gapping up: BIG JSDA NSM MAMA AVAV ACH EAT;

Gapping down: PSPT GMKT LMRA ZQK ENCY TSM YHOO;

THE EWA

The Australia ETF looks like a pretty good long term bet as the chart is favorable and the sectors specific to the country look enticing. It also seems to be at a nice entry point as the trend looks like it is ready to continue. The largest sector weights are:

Banks 24%

Metals/Mining 15%

Reits 10%

Insurance 8%

Food/Retail 5%

Energy 4%

The biggest holdings are:

BHP Billiton 10%

National Australia Bank 7%

Australia and New Zealand Banking 6%

Westpac 5%

Westfield Group 3.5%

CLOSING GRIEF

Markets sold off in late trade as NEW nonsense came to light ending the day's rally. The futures rallied after the close so another opportunity to sell before the jobs number.

The DAIS closed up 68, the NAG +13 and the SPEC +10.

Market internals were bullish all day and closed at +2,150 on the NAG/NYSE and at least 2/1 up on the OWES/SPEC/NDIS trio.

Strongest stocks included LEA MA GSA WYNN LBS MUSM F ATA T and TEXAN.

Big losers included S MISFIT WY COST BEAK HAMLIN BIBB and ADS.

Volatility indexes moved higher on the NEW news and closed down about 5% on the day after being down by 10%; about 5/7% below their 10 day smash.

I mentioned a few times that I was looking for 1,400 to be tagged on the SPEC and then maybe 1,415 as that would be a 50% retracement from the recent lows. Today, we hit 1408 and a buyable pullback from here would not be surprising. Obviously, a good excuse for a little selloff will be tomorrow when the jobs numbers appear. I suspect any selloff due to that number will be bought next week.

AFTERNOON THOUGHTS

Markets are hovering near their highs but giving opportunistic traders the chance to scalp some profits.

Strongest sectors include gaming, semis, brokers, reits, retail, oil service, small caps, tech, metals and homies. Biotech and utilities continue to lag.

Probability says we close at/near the highs as the Market internals are very strong and are giving an upside wink as the cliche "markets that are strong all day generally close at/near their highs" is probably applicable.

The OEX is 90/10; NDX 85/15 and SPX 450/50.

The NYSE is +2,100 and the NAZ +1,240, also very strong.

IBD 100 also about 95/5 between winners and losers.

Volatility indexes- lower by about 11% and shouting sell as the magic 10% under the 10 day SMA is here and now. Probably tomorrow as the 2 day RSI on the SPX is also now over 80.

Key stocks are all strong with GS MER MS LEH ICE all indicating a strong close.

The fly in the ointment (always something), job report day tomorrow- will longs hold overnight if they anticipate a lousy number? My guess is that a lousy number is anticipated in light of recent news from construction/retail and the colder weather.

So who doesn't know, and isn't that one of the reasons we sold off last week? Old news? We shall see.

MORNING MARKETS

Markets opened higher and haven't look back and the guy from DR Horton must have given his outlook yesterday the way markets are trading.

strongest sectors include semis, gaming, brokers, emerging markets, reits, retail, internets and homies. Weakest include biotech and utilities.

Market internals are very bullish with 9/1 the up to down ratio on the OEX/SPX/NDX indexes.

The NYSE/NAZ net green is 2,040/1,300. IBD 100 also with over 90 winners.

Volatility indexes crushed with the VIX/VXO combo each down in excess of 10% and now trading under the magic 90% of 10 day SMA number.

Strong stocks today include GS MER MS MSC LEH ICE NYX CME MA MNST NTAP KLAC NVDA AKAM SNDK F ATI NSM TGT and GOOG.

Weak sisters include S WY XOM AMGN CCU CVX PEP BEAS AEOS and CHKP.

My plan is to sell into the SPX 1415 area as that is the 50% retracement area. So maybe another lift this afternoon will get us closer to the target.

THE GAP

Markets are set to gap higher on the heels of higher European/Asian markets and maybe a revisit from the bull.

John Carter, in his terrific book did some testing for Thursday gap fills and the answer was the gap filled 82% of the time.

My guess is plunging volatility indexes and higher prices, but still opportunities to enter as the next stop may be SPX 1415, 15 points higher than where we will probably open and about a 50% retracement from the recent lows.

CLOSING CHOP

The DJIA closed lower by 15, NAZ -10 and SPX -3 as the 1,400 number on the SPX is tagged (target 1, round number) as markets chopped higher most of the day before turning red during the final and most important hour of the day and is blamed on some "unfriendly" comments from the CEO of DHI. NAZ underperformed all day (no energy) along with tech, internets and semis.

The 10 year Bond drifted higher most of the day and now yields 4.497%. Rate cuts anyone and hello JNJ and other big cap recession resistant stocks.

Strongest sectors were oils, metals, trannies, homies, retail, midcaps, small cap value, utilities and drugs. Leading lower were gaming, real estate, tech, software and airlines.

Market internals were flat on the NYSE and red on the NAZ (-500).

Big cap index internals were red on the big three with 35/65 on the OEX/ NDX and 185/315 on the SPX.

Big cap winners included oil patch equities such as WMB COP SLB NSC CVX and HAL. Losers were WY EMC VZ ORCL MRK T RTN ROK and CPB.

IBD 100, a bit better with about 50 in the green led by DWSN EDU BTJ POT CNH HPC and HOC. Losers included ICE HRT CNVS CPA LFL and NTY.

Volatility indexes down about 5% and now at oversold levels as the VIX/VXO are about even with their respective 10 day SMA's.

VLO anyone (+17% in 2007), or TSO/HOC/XOM/FTO/COP, the refiners rip higher on the fear of inventory shortages, higher crude prices and the summer driving season?

CHOP CHOP

Looks like the call for choppy trade was correct (so far) as the bulls and bears try contemplate the direction of the next 200 points.

Strongest sectors - oils, metals, trannies, midcaps, drugs, retail and utilities while gaming, real estate, software, airlines, tech and biotech bring up the rear.

Market internals- flat on the NYSE and net red 440 on the NAZ.

Major index internals - OEX 40/60; SPX 200/300 and NDX 35/65.

IBD 100 stocks about 50/50 with CNH EDU POT DWSN BTJ ALGT and HPC leading and CPA ICE NTY HRT CVNS CHL and SYX lagging.

Key stocks MER MS BSC AAPL higher and GS GOOG INTC BIDU DNA ICE CME IAI all lower.

Volatility indexes all lower and now trading only 3% above their 10 day SMA's and 2 day RSI on the OEX now near 60- So much for the oversold markets.

MORNING LULL

Markets trade flat at the open with oils, retail and brokers leading and emerging markets, metals, biotech, tech, semis, internets and gaming lagging.

Market internals have flipped to pink with a net 400 red on the NYSE/NAZ combo while the internals on the NDX are much worse with about 25 green and 75 red. The SPX/OEX are slightly red with about 40 up to 60 down.

IBD 100 is starting 40/60 between winners and losers with CNH EDU SDX HMIN DWSN and POT green while CPA VOL ICE CHL LFL and HRT are red.

Interesting split as most of the brokers are green while the exchanges are red and GOOG, which was upgraded this morning is down slightly.

Volatility indexes about unchanged and the overbought numbers will rapidly come down as time passes and the 10 day SMA slowly meets the current numbers.

Keep in mind that days after big trending days (yesterday) are generally choppy, so don't expect much and I bet that is what bull are hoping will happen.

And how about this new activity on CNBC- the anchors act dumber and dumber and Erin and Cramer have become a new Abbott and Costello series.

HAPPY HAPPY

Markets closed near the highs as the DJIA was +157, NAZ +44 and the SPX +21.

Strongest sectors - silvers, gaming, emerging markets, Australia, metals, brokers, real estate/reits, small caps/value. Biotechs, drugs and trannies underperformed although all higher on the day.

Market internals- the opposite of the last few days and very bullish with a net 4,000 green on the NYSE and NAZ. The big index internals - just great with about 470 green on the SPX/ 95 on the NDX and 97 green on the OEX.

IBD 100 stocks- 95 up and 5 down. Big winners include HURC BTF WFR TATTF HMIN and SSYS.

GOOG AAPL GS IAI MA BSC LEH CME NYX all very, very green. The drugs and the consumer sectors didn't do well and I will take that as bullish.

Interesting how the strategists show up on CNBC this afternoon and say "of course we are having this big rally, we were very oversold." Yes, I know that was the easy trade- nevermind all the strategists who were on TV yesterday who said "we probably have more to go on this selloff."

I must confess, I bought too early in this selloff (last Tuesday/Wednesday) and didn't sell; and today it paid. Also, bought the Scooter Libby selloff at Noon and rode those YM DJIA futures all the way to 12,225. Very Lucky.

Where from here? Next stop probably the 1,400 level on the SPX and maybe near 1,415 as that will be a 50% retracement from the 1,375 low.

Volatility indexes, crushed and now trading only 9% above the 10 day SMA levels. The 2 day RSI back at 65 so maybe a little higher to start unloading as I suspect the selling will begin at 1,400, a nice round number.

MIDDAY MUSINGS

Markets continue higher with the DJIA +96, NAZ +34 and SPX +14.5.

Best sectors continue to be silvers, gaming, Australia, metals, emerging markets, real estate/reits, brokers, small caps/value, tech and oil. The worst are biotech, banks and drugs.

Market internals continue very bullish with about 3,800 net green on the NYSE and NAZ and about 9/1 green to red on the OEX/NDX. The SPX also 9/1 with about 50 red stocks out of 500.

The DJIA with 5 red including PG JNJ HD MMM and AIG.

The IBD 100 MOMO group with 95 up and 5 down.

Strongest stocks include BTJ HURC WFR HRT HMIN MIR NVDA DISCA CTSH INFY XMSR SIRI and NIHD while LINTA CHKP EXPE BBBY CHRW SPLS BMET MNST F CL BAX and ABT are the reddest of the big caps.

Fear is rapidly leaving the markets as the VIX/VXO combo is down 15% and trading only about 15% above their 10 day SMA's.

I bought the Scooter Libby dip in the YM and will probably look to sell the next burst up or high TICK reading as I suspect we trade in a narrow range for the rest of the week as the markets calm down.

OPENING BOUNCE

Markets open higher and Turnaround Tuesday is firmly in place. The DJIA +77, NAZ +26 and SPX +12.

Strongest sectors inlcude the beat up metals, Australia, gaming, emerging markets, brokers, reits, oils, small caps value and tech. Weakest include biotech, banks and drugs.

Key tell stocks are mainly higher with the brokers led by LEH BSC and GS solidly green; GOOG and AAPL also up nicely.

Market internals as good as they get with a net 3,600 green on the NYSE and NAZ.

The OEX/NDX both with 4/1 green /red ratios and the SPX with 420 up and 80 down.

The IBD 100 MOMENTUM stocks are about 9/1 up to down.

Biggest winners include HMIN HRT HURC MR BTJ DWSN INFY TEVA WYNN SNDK ATI AES LEH GS GOOG and ORCL.

Biggest losers include MCD AMGN EMC CCU F EXPE LINTA MNST SEPR and IACI.

Volatility indexes down over 11% and hardly back in sell areas but my guess selling some here if you bought yesterday is probably not the worst move.

The 2 day RSI on SPX /DJIA near the 30 level.

In light of this recent big down trend, one can anticipate the buyers will be quick flippers and that is why I say smoke em if you got em.

CLOSING PRICES

Markets close near the lows as the DJIA was down 65, NAZ down 27 and the SPX lower by 13.

Anyone watching the markets today could tell you the major indexes were better than the average equity as there were about 4,000 more losers than winners.

Strongest sectors (although all lower) were banks, drugs, tech and defense. The weakest, reits, gaming, brokers, homies, metals, small cap value, silver stocks and emerging markets.

The NDX/OEX had 15 up and 85 down, while the SPX had about 60 up and 440 down.

The DJIA was the best of the indexes as it was only down .5% with 5 up and 25 down.

The IBD momentum stocks, yes also awful with 15 up and 85 down out of the elite 100.

And on today's crummy close, the VIX/VXO combo was up a whole 6% and trades back to the 135% of the 10 day SMA level.

Some good news, one of the market indicators that I track, the CHADTP, is about as oversold as it gets. The CHADTP is a short term moving average of the net advance / declince line that was concocted by Blake Hayward and Larry Conners of Trading Markets fame.

FLIP FLOPS

Don't like the numbers on the screens, give it a few moments they will change, a lot.

At the midday mark the DJIA has swung about 150 points and is now about flat; the SPX a range of about 15 points and down 4, and the NDX, down 11 with a 30 point range.

Strongest sectors - semis, tech, biotech, drugs and large cap growth. The worst, gaming, reits, metals, homies, oils, small cap value and brokers.

Overall market internals never confirmed the index move as they have been weak all morning; the NYSE with 1,800 net red and the NAZ with 1,400 net red.


The DJIA still acts best with about 20 up and 10 down with KO MRK HPQ and INTC the winners while AA JPM MCD UTX and DIS the biggest losers.

The OEX internals have flipped to 35/65 red to green; NDX 25/75 and SPX 120/380.

The IBD 100 with 20 up and 80 down.

Strongest stocks include AMLN KLAC MCHP AAPL AMGN DISH CSCO KO and AVP while the weakest include AES LTD COF AA HAL SIRI WYNN XMSR MRFL INFY and AEOS.

I am sitting on my hands after "selling" my QID, the double inverse NDX. Probably gonna look to reenter on an afternoon rally.

And who isn't trading off the dopey pile of tens that CNBC is showing us all day. Can't they come up with something worthwhile to fill up airtime. After all, the markets are kind of volatile.

OPENING LOOK

Markets are open and the major market indexes are higher with the DJIA +35, the NAZ +2 and the SPX +1.

Strongest sectors are tech, semis, biotech, internets and airlines while the weakest are metals, reits, homies, brokers, oils and utilities.

The DJIA shows 25 up / 5 down - flight to quality; OEX over half green; the SPX and the NDX both about 50/50 up to down.

Overall market internals are weak with a net 1,000 red on the NYSE and 570 net red on the NAZ.

The IBD 100 - about 40 green with WEBX UCTT WFR HURN and DECK leading while HMN EDU PCCC TATIF and VIP acting the worst.

Volatility indexes slightly higher after a burst up at the open and the brokers still acting funky as all are lower with MS acting the worst.

BLUE CHIPPING

Early morning futures find the major indexes down about 90 on the DJIA and 10 on the SPX.

Checking the last major market drop, May of last year, the drop at its worse was about 1,000 points on the DJIA and 110 SPX points from top to bottom over the early May / mid June trashing.

This morning's numbers will get us about 800 off the recent highs on the DJIA and 90 on the SPX. Don't know if that will be the extent of the damage but in my view stocks are getting cheap. Also, from experience, stocks go up and down more than one thinks possible or justified, just check the March 2003 low on the SPX; under 800. FWIW.

One big cap stock that wasn't mentioned in my previous post that looks attractive in light of its own recent sell off is JNJ. The chart, with the PE and dividend yield included, does seem to indicate a decent entry point.

According to Value Line's estimates, JNJ is trading at a P/E of 15.6 on 07 estimated EPS ($3.95); and a P/E of 14.6 on 08 estimated EPS ($4.25). The yield of 2.5% is historically high and JNJ has a pristine balance sheet and should be a top defensive play if the economy does indeed roll over. Oh, and BRK owns more than 21 Million shares of JNJ as at December 31.