THE CLOSE

Another brutal day for investors ends at the lows as the all the major indexes were down about 1.6%.

Strongest sectors (but red) included gaming, brokers, banks, small cap growth and internets while real estate, oil service, drugs, integrated oils and metals acted worst.

Winning stocks- WYNN FAST CELG DISCA PETM F HET GOOG JPM CCU PG BUD MMM DECK CPLA WBD CMG CNH OPY ICE and VSEA.

Losing stocks- NTGR EDU VCLK SNDA CENX ALY DXPE WY HIG BMY MRK GM XRX ATI CAT SEPR RYAAY VRSN APOL AKAM MXIM CHIP and BEAS.

Market internals ugly again with 1,250 net losers on the NYSE and 1,350 net losers on the NAZ.

The NDX had 20 winners out of 100 while the OEX had about 15 in the green.

Volatility indexes way up again (15%) and now trading between 30% and 40% above their 10 day SMA's. Very rare for them to get this overbought and when they fall it may be far and fast causing a big bounce in equities. Yes, I know, broken record.

OPENING JITTERS

Markets trade a tad higher as we are very oversold and maybe heading for a sustained bounce.

Strong sectors are where a bull wants them, Xchanges, brokers, banks and tech; weak are real estate, airlines, integrated oils, drugs and biotechs.

Winning stocks inlcude NVDA CELG BRCM DISCA FAST ISRG GRMN SLB BA ATI LEH MMM BAC WFC DECK DRYS CF PCR ICE CME GS NYX NMX.

Losing stocks include - NTGR EDU MR OYOG WY COP EP CBS XOM SEPR VRSN CTXS BIIB PDCO MCHP and MSFT.

Market internals started ugly on the NYSE but have since flipped to green and now show about 450 more winnners than losers while the NAZ internals are a hair in the red.

Both the NDX/OEX internals show 3/2 green to red.

Volatility indexes down but hardly cratering as the VIX is lower by 4% and the VXO lower by 1%.

The best performing indexes are the Mids and the NDX- the QQQQ is already trading over $49 and a mere $1.5 from its 52 week high it hit a few days ago.

BUY LOWER SELL HIGHER

On a final note, the other day when I discussed my "signals," I mentioned a moving average of the Advance/Decline lines. Low and behold, today's averages hit numbers last seen on March 5, 2007 and May 17, 2006. If one looks back on the charts, those were pretty good days to buy the markets.

So, with VIX/VXO moving averages stretched at/near 25% above their respective 10 day SMA's, the 2 day RSI numbers about as low as they go on the major indexes and the advance/decline lines about as oversold as they get- therefore I will declare a buy signal.

THE CLOSE

Markets close the day off their lows and maybe giving some hope to the bulls as the large caps were the best of the bad while the RUT and MID's were the worst of the major market indexes.

Strongest sectors were red and included biotechs, tech, semis and large cap growth; worst were airlines, gaming, oils, metals, homies, brokers, defense and utilities.

Strong stocks - AAPL CELG SYMC ISRG VRTX GENZ F MMM AMGN BIDU FSTR VSEA DECK CF POT ARD and ICE.

Weak stocks- NTGR PCR EDU ELP CENX HURC TWIN TBSI BTJ AA BDK AES EXC XOM DOW LEH LTD GM AKAM LVLT JOYG XMSR FISV PCAR and VRSN.

Volatility indexes closed the day higher by 15% on the VIX and 21% on the VXO. Still way over bought and if you wait long enough probably will look like a great buying opportunity in a few weeks.

Other stuff:

Ags- BG up 4.35% while CAT CNH DE IR MON MTW all lower;

Financials- all lower with the exception of ICE- biggest losers- CFC STT WB WFC BEN BSC GS LEH LM NDAQ and NYX;

Biotechs mixed with CELG DNA GENZ up while BIIB GILD lower;

Consumers all lower led by DEO GE MCD SBUX;

Gaming- all red with the exception of MCRI- MGM down 4.5%- WYNN down 5%;

Healthcare- all red - AZN LLY SGP the worst of the bunch;

Media- ugly as DJ hangs in unchanged- while CMCSK LBTYA LINTA crushed;

Metals- brutal day as BHP -4.5%, FCX-4%, GDX -5%, PAAS-6% SSRI -4.8%;

Oils- about 25 on my screens and 1 green NFX, XLE -3.8%, OIH -2.4%;

Retail- CROX soaring in the after mkt on earnings/guidance; M TGT SHLD PVH LTD KSS CWTR COH all crushed on the day;

Tech- 20 tech stocks on the screen- all red with the exception of AAPL; worst of the bad- AKAM INFY INTC MOT MSFT YHOO TXN;

Trannies- all shot today led by CP FDX LUV UAUA BNI;

I covered some QQQQ shorts today as I have a suspicion that we are looking at a nice rally. I suspect some good news is on deck which will put sub prime/credit issues on the back burner at least in the short term.

NOON SWOON

Markets continue to sell off hard as the DJIA is down 300+ points as I type. Seems as if never another private equity deal/takeout and certainly never another up day in the equity markets.

Strong stocks include AAPL VRTX CELG APOL AMZN F PG BIDU FSTR BG and CROX.

Weakest stocks AKAM LVLT JOYG PCAR CMCSA FISV LBTYA BDK AA EXC LEH GM GS PCR CENX TBSI GSOL CF ACH and ELP.

Market internals again as bad as they get with 260 up and 3,050 down on the NYSE and 430 up and 2,600 down on the NAZ.

The NDX has 8 winners while the OEX and the IBD each have 4 stocks higher;

Volatility off the charts as the VIX is up 20% and the VXO up almost 25%

I plan on scaling into futures this afternoon as I suspect stocks have some value to someone. And what will happen when/if the next deal is announced?

MORNING MARKETS

Markets are lower yet again on the heels of credit worries and lower overseas markets. The biggest losers are small caps and value oriented stocks. The NDX is also strong on the heels of AAPL GOOG AMZN etc.

Strongest sectors include biotech, tech, internets and defense while airlines, brokers, homies, metals and oils act the worst.

Interesting action as the following stocks are green- CROX AAPL AMZN GOOG HPQ RIMM NFX ICE MCRI INFY CELG DNA MRK.

Volatility indexes way up again and the VIX is now at 19.5 and trading 16% above its 10 day SMA. If you look at days when the VIX was this far stretched, it was generally a pretty good time to buy for a short term profit.

In spite of higher crude, oils and refiners are lower yet again- just wonder how much they are going to bounce when the markets turn higher.

Other stuff:

Ags- lower, but I suspect buying CNH DE MON MTW in these areas will pay off pretty well down the road;

Brokers and banks way lower again;

Biotech - DNA CELG BIIB GENZ all green;

Metals crushed on the heels of lower gold and silver- BHP FCX PAAS SSRI probably worth a dip here;

Retail all red with the exception of CROX- COST DECK GES KSS LTD M PVH SHLD TIF TGT UA - all ugly;

Tech about the strongest group with AMZN HPQ IBM NVDA RIMM AAPL all green in the face of ugly indexes.

THE CLOSE

Major market indexes closed in the green but looks are a bit deceiving. The RUT closed flat while the MIDs closed lower.

Strong sectors included internets, biotechs, oil, oil service, defense, retail, large caps and drugs; lower were metals, airlines, homies, trannies and reits.

Big winners included AMZN VRTX AMLN GENZ BIIB JNPR GRMN MRK PEP GD BA COP T GS UPS XOM SLB NOV EDU BIDU SII and PVG.

Big losers - PCR SNHY TWIN HDNG FSTR BTJ HURN CNH DRYS XRX F BAX IP EXC GM NSC CAT JOYG PCAR CHRW MICC TLAB and PTEN.

Market internals much worse than the big indexes as the NYSE closed with 620 more losers than winners while the NAZ was a hair better with only 270 net losers.

OEX with almost 60 up to 40 down while the NDX was far worse at 45 up and 55 down.

Volatility indexes lower but not a big move as the VIX loses 2.5% and the VXO 4%. Both still over 110% of their respective 10 day SMA's which is probably indicating yet more upside to come in the major indexes.

More stuff:

Ag stocks crushed led lower by AGU CAT CNH IR MON MTW and POT;

Banks and brokers better today with GS outperforming and BSC CME ICE LM NMX under performing;

Biotechs act well led by BIIB CELG DNA GENZ and AMGN;

Gaming a mixed bag with LVS up and MGM down again (reversion to the mean);

Metals generally crushed with BHP flat;

Oils generally higher with refiners lagging and red again;

Tech mixed with AAPL AKAM AMAT AMZN CSCO EBAY IBM RIMM SNDK TXN green and BRCM GOOG HPQ INTC MSFT NVDA YHOO red;

Trannies red with the exception of UPS and YRCW;

Some 2 day RSI's:

SPX 36

DJIA 43

RUT 10

MID 3

QQQQ 23

IWM 2

COMPQ 27

MORNING MARKETS

Markets trade all over the board as the SPX range in the first 2 hours was 20 points. Big caps are the strongest while Mid caps the weakest.

Strongest sectors include internets, biotech, tech, defense/aero, retail, drugs and utilities. Weakest include metals, trannies, homies, airlines, reits and oil service.

Winning stocks include CROX AAPL AMZN CNQ COP MRK BA GD WYNN LVS NOV AFSI EDU GRMN OPY ACH CHE BIDU NILE CL and AVP.

Losers HOC VLO FTO CAM RIG ICE NMX JPM C BAM MGM CAT DD MTW FCSX CMED BTJ CNH HDNG JOYG CHRW MICC PCAR ISRG and NIHD.

Refiners and ag machinery stocks falling off the table;

Brokers lower with the exception of GS;

Biotech green led by BIIB GENZ;

DJ is up 3% all of a sudden;

Retail high flyers such as PVH GES DECK all lower;

Tech a mixed bag as AMZN AAPL CSCO EBAY HPQ IBM green while GOOG BRCM INTC KLAC MOT MSFT NVDA red;

Market internals were strong at the open but have flipped to red as there are now 500 net losers on the NYSE and 300 net red on the NAZ.

Volatility indexes flattish and still hanging in the area of a buy signal for the major indexes.

SIGNALS

David at the DK report had a wonderful post on Sunday about various timing indicators and who (bloggers) uses them. Just a little note on how I use the 2 day RSI indicator and my trading style. I don't use a strict mechanical system with this indicator as it is only one part of a methodology I use to generate buy or sell signals.

Another part of my equation is the VIX/VXO. Generally when the VIX/VXO is above 110% of the 10 day SMA a buy signal is generated. Sell signals on the VIX/VXO are supposed to be at 90% of the 10 day SMA but I prefer to trail a stop or sell on a subjective price spike.

Part 3 of my equation - market internals; when they are overbought/oversold on a short term basis- (I use a short term moving average of advancing/declining issues) - the third part of my signal is generated.

I have the most confidence in a buy or sell of a major market index/future when all 3 signals are in play. It is generally hard to buy when all three hit as the markets appear to be in free fall and fear is high.

Finally, I don't buy all at once as I prefer to scale as the signals have never proven to be perfect. Check out the book above as it is a great read that "test and proves" how buying lows and selling highs is probably the best trading option.

THE CLOSE

Markets closed the day at/near the lows as folks heard some pretty sour information first from CFC and then from Bill Gross who made the case for lower stock prices. I don't like to bash anyone for no reason, but at just about the bottom of the market in late 2002, Bill Gross had this to say about the DJIA. Please note that the markets bottomed in October 2002 and again in March of 2003 and it has basically been gone straight up since. Never did we come close to his numbers.

Anyhow, the DJIA closed down 1.6%, SPX -2%, NAZ -1.9%, RUT -2.85% and the Mids down 2.3%.

The strongest sectors were airlines and biotech while brokers, homies, utilities, oils and small caps were the worst.

In the green were AXE RRST GME GOOG CHKP TLAB AMLN UAUA QCOM AMGN;

Biggest losers included AAPL MICC PCAR CKFR MNST WFMI RIMM EXPE DD EXC AES AXP TXN ETR JPM CME MS MER LM LEH GS BSC and KLAC.

Market internals about as bad as they get with 870 winners on the NYSE/NAZ and 5,600 losers.

Volatility indexes way up with the VIX closing at 18.53 and 14% above the 10 day SMA and the VXO at 19.03 and 18% above the 10 day SMA.

Various 2 day RSI numbers:

SPX 12

DJIA 18

QQQQ 5

RUT 3

MIDS 3

My strategy will be to buy some exposure to the major indexes tomorrow as I expect a dip in the morning which will probably be bought later in the day.

On a final note, I never understand why when the markets dip 1.5% or 2%, CNBC treats it like the world has ended yet when almost every guest predicts a 5% or 10% correction they don't flinch thinking that it is ordinary and necessary.

CREEPING UP

Markets continue to trade lower but some interesting action can still be found. The DJIA -66, NAZ -13 and SPX -9. The NDX is the strongest major index trading flat as AMAT AMGN AMZN CSCO EBAY GOOG INTC MSFT SNDK and YHOO all trade green.

Other strong sectors include airlines, biotech, metals and internets; weak links found in the oil patch, brokers, small caps, homies and small cap value.

Market internals still ugly on the NYSE at red 2,000 and red 1,500 on the NAZ.

The NDX internals far better at even while the OEX internals are 3/7 up to down.

Big banks trading ugly also as C JPM WFC BAC are all red;

Biotechs all green led by BIIB CELG DNA GENZ and AMGN;

Brokers bad but seem to be improving as GS is only down a buck;

Gaming mainly lower but MGM may be back in buy territory;

DJ in the media area continues to trade as if the deal is dead; I suspect they come to their senses and sell but in the mean time;

Oils all red with the exception of RIG as crude trades as if there will never be another green day;

The TRIN is trading at .75 indicating that a lot of the volume is flowing to advancing stocks as the losers are trouncing the winners over all;

Volatility indexes also coming back in as the markets try to climb higher;

THE OPEN

Markets open/trade way lower on the heels of crummy news from CFC and more worry about how deals will get done as financiers tighten lending practices.

The DJIA is --.62%, NAZ -.86%, SPX -.75%, RUT -1.7% and MIDs -1.2%.

Strongest sectors are metals, airlines and biotechs while homies, brokers, semis, oils and small caps lag.

Winning stocks include AMLN TLAB CHKP UAUA BIIB VZ MRK UPS PG AXE GME RRST ACH BIDU FTK GOOG CROX SGP AMGN and DNA.

Losers across the board led by MICC EDU CRDN ATHR HDNG DRYS AAPL GS LEH LM CME ICE JPM MA AKAM KLAC DVN HOC VLO XTO RIG SLB and CFC.

Market internals horrendous at 2,100 more losers than winners on the NYSE and 1,600 net losers on the NAZ.

The IBD 100 showing 15 winners and 85 losers as is the OEX while the NDX is better at 25 up and 75 down.

Volatility indexes much higher with VIX/VXO near the 18 level and over the 110% of the 10 day SMA "buy signal."

THE CLOSE

Markets closed higher but off their best levels of the day as merger activity cheered on buyers. The DJIA closed +93, NAZ +3 and SPX +7 while the MID's closed red along with small caps.

Strongest sectors included oil service, drugs, utilities, defense and large caps while real estate, reits, homies, airlines, biotech and retail lagged.

Big winners included ISRG TLAB WYNN PCAR CSCO MRK CSCO HAL PEP T CL NVT TBSI EDU ACH CMED DRYS and OIH.

Big losers- PVG FCSX BIDU SNDA SNHY PCLN ARD ICE SIMO EXPE SHLD MRVL GILD WB EP AA CAT GOOG AES TGT and HD.

Market internals were slightly red on the NYSE and NAZ while the OEX was strong at 3/1 green / red and the NDX closed with an equal number of winners and losers. IBD 100 also strong at better than 3/2 up to down.

Volatility indexes a bit red as the VIX trades about 5% above its 10 day SMA.

Other stuff worth noting:

Small and mids starting to under perform while the NDX also seems to be losing its jig as GOOG is lower yet again;

CAT and DE down again;

Banks/Brokers/Xchanges mainly lower with the exception of C MA BEN BX LEH NYX TROW;

Biotech crummy again led lower by GILD CELG;

Consumers Non durable strong led by CL KMB PEP PG SBUX;

Media a mixed bag as folks wait for the DJ verdict- market seems to be saying not a done deal as it sinks lower yet again;

Metals- generally lower with BHP the exception;

Real estate ugh lower again;

Retail lousy with the exception of CROX CVS DECK GES PVH WFMI;

Tech lousy led lower by GOOG HHH AKAM BRCM HPQ KLAC MOT RIMM YHOO;

MORE STUFF

So just as I type the bearish view the brokers/ selected tech gets a bid and the internals improve.

Ag sector- AG CNH MON MTW POT green while CAT BG DE continue to sell off;

Banks- mixed bag with C MA MTB STT green while AIB JPM WB red;

Brokers- BEN BSC BX GS LEH LM MER MS NMX NYX TROW all green while CME ICE NDAQ red- note MER hit a high near 95 in Jan and has sold off 15% since;

Biotech - generally red with the exception of yikes AMGN;

Consumers green with exception of MO;

Defense GREEN;

Gaming- GREEN;

Healthcare- green with the exception of DGX/COV/SNY;

Media- DJ continues to drip lower as the deal continues not to happen- I suspect it happens this week as the Bancrofts gather their senses;

Metals - red with the exception of BHP;

Oil service - green with the exception of HP;

Oils - red with the exception of CVX TSO XOM - XTO SU COP CNQ APC look like an area to dip;

Real estate- red as usual in spite of rates under 5%;

Retail- generally green with CROX PVH DECK KSS WFMI out performing;

Tech- generally green with SMH CSCO IBM MSFT NVDA RIMM SNDK TXN good and GOOG EBAY HHH MOT KLAC YHOO all red;

Up volume double down volume on the NYSE while the VXO is now down almost 7% and near its 10 day SMA;

One other thing- its a bull market and keep that on a post it near the screen-

MIXED MESSAGES

Markets are trading higher although the message of the markets as I type is indecisive. The big caps are up led by the DJIA (+60), while the tech heavy NDX lags in negative territory.

Strongest sectors include oil service, drugs, utilities and defense while airlines, biotech, reits and real estate lag. The brokers are mixed with LEH LM green while GS BSC MER MS are red. Tech also mixed as IBM CSCO AKAM HPQ INTC MSFT TXN are green while AAPL GOOG RIMM ZMAN BRCM EBAY KLAC and YHOO are red.

Winning stocks include MRK ABT HAL T VZ IP TLAB ISRG RYAAY VMED DISCA WYNN SNDK SBUX NVT TBSI TWIN FTK and PCR.

Losers include SNHY BIDU ICE AAPL FCSX PVG NOV AA EP COP CAT EXPE CELG BEAS PTEN CHRW GOOG AMZN and RIMM.

Market internal are net 400 green on the NYSE and flat on the NAZ.

The OEX is very strong with about 3/1 up to down while the NDX is ok at 3/2 up to down.

Volatility indexes are mixed and trading about 6% above their 10 day SMA's.

Many mixed readings this AM led by the brokers which will probably oscillate in a range for now and cause the over all markets to also be range bound. Big cap tech also week causing me to be a little bearish on the markets for the moment.

HIGHER OPEN

Markets are set to gain back some of Friday's losses on the heels of some weekend M and A activity and some strong earnings news. Gapping up on news include:

OPSW TLAB ARRO EVVV FOXH TASR CALM SILC PETS MRK SGP and GSF;

Barrons was bullish on M BBY BBBY KSS AAPL LVS and NTDOY;

Some stocks moving up the IBD 100 list include:

RIMM 3

BIDU 4

CNH 5

DECK 6

AAPL 8

POT 9

PCU 11

CRDN 17

TEX 18

ISRG 19

NOV 27

GES 32

ICE 41

BHP 63

SLB 65

MTW 72

HOC 88

CAM 99