THE WEEKEND

Big cap indexes continue to trade lower with some strength found in the NAZ/NDX and the RUT (flattish). Metals and oils act best while financials, real estate, homies, retail and large cap value act worst.

I will go along with the Bill Miller take that lots of money will be made on financials over the next 5 years, just lemme know when/where we come close to the bottom.

The internals on the NDX/OEX/IBD 100 act better than all the indexes as the NDX/IBD show 60% in the green while the OEX are close to 50/50. The IBD 20 also acts pretty well as ABX NOV RIMM HAL GILD YHOO WFT HPQ and XTO are all green.

Key stocks- also about evenly split between winners and losers as BIDU NVDA MTW DECK CAT INTC GOOG all solidly green while the usual suspects such as MER LVS MS BAM GS VMW WYNN are all red.

VIX up a bit more than 3% and about 15% above the 10 day SMA;

Surprisingly, the up/down volume on the NYSE is not showing any strength as down volume is almost double the up;

RSI (2) on major large cap indexes still in the mid teen level and I will be waiting for a better signal to buy. My suspicion is we won't roar out of the gate on Monday, and midday may be a time to get in for a short term flip.

Oh and go Colts-

TECHNICALS- SPX

Markets are trading down with the SPX down 13 at the 1,495 level. Where to from here?

A few thoughts- today's first support level (pivots), near 1,495, which has been touched a few times already, maybe a bounce area before a slip lower and the lows from last week near the 1,490 level may be a reversal point for a "meaningful" bounce. Also note that today the SPX slammed into the 50 day SMA at 1,512 and turned around right there, so mark that down for future reference as resistance.

Another spot to look for down the road is the 1,476 level which is the lift off spot from the first rate cut on September 18. That also happens to be at/near the up trending 200 day SMA.

My guess is we will probably get down to those lower levels but they will be buy areas as I still expect the markets to close the year on a high. My game plan is to scale in when the buy signals shout.

THE OPEN

Markets opened strong on the heels of the strong job number but was quickly sold and the DJIA is down 70, NAZ -10 and SPX -10 as I type.

Strong sectors include metals, drugs, semis, oils and biotechs while fnancials, homies, real estate, gaming and retail act the worst.

Key stocks generally lower with MTW BIDU NVDA DECK RIMM and MO green while LVS MER WYNN UA VMW UA GS BAM all crushed.

Big winners- ERTS SIRI XMSR LVLT CTSH S F SLB S NXY AES NSM PG HPQ HMSY SYNA ANSS CLB TEF BIDU WX;

Big losers- EDU SNHY EJ VSEC FSR CMG SSRX VMW MER CI AIG JPM GS WB MS BAC WYNN LVS SEPR MXIM AMZN EBAY;

Market internals opened strong but have since flipped to red with 750 net losers on the NYSE and 450 net red on the NAZ.

NDX -stronger than expected with 45 WINNERS;

OEX -40 WINNERS;

IBD 100-30 WINNERS;

VIX higher by 6% and getting very over bought;

RSI (2) on major indexes trading at/near 15 and getting down to the buy levels of under (10).

I don't have any great insight into what will change market direction as financials/brokers are getting crushed on the WSJ article about MER. Suppose the best thing to do here is follow the signals and buy if the targets get hit.

UGLY CLOSE

The general rule, markets that are weak all day tend to close at/near their lows and that proved to be true again today as the DJIA closed down 360+ while the SPX was down 40 and under its 50 day SMA (1,512). Far and away the worst performing major index was the RUT, down almost 4%.

All the DJIA components down except for the next GOOG, yes MSFT.

All the major sectors ugly with oil service, biotechs, defense, semis, large growth and drugs the best of the bad while banks, financials, brokers, homies, real estate and reits the worst of the bad.

Ags hit especially hard with ADM AGU BG CAT CNH DE MON MTW POT all crushed. Gaming also way down as WYNN/LVS lose another 4/6%.

NYSE internals- 2,300 net losers;

NAZ internals- 1,875 net losers;

OEX -1 WINNER;

NDX 10 WINNERS;

IBD 100-7 WINNERS;

TRIN 2.91;

Down Volume- 20X Up volume- 87K green and 1,642 red;

VIX -higher by 27% and at a buy signal at 112% of the 10 day SMA;

RSI (2) on major indexes near the 20 level;

Winners- MSFT CPLA CYNO FMCN CTRP BIDU SNDA FLIR XRAY ESRX IACI LBTYA MRVL PDCO LOGI PTEN BRCM DISCA MXIM BIDU HOC AMGN;

Losers- GRMN SIRI XMSR VRSN ROST SPLS C MS AIG MER JPM ATI BAC GM COF WB FTK PKX GMCR SYNA SNP EJ EXLS FCX NOV ABX BLK BG MTW UA CROX LVS TIF DECK WYNN;

Interesting how listening to Madame Bartiromo is kind of comical- just the other day when the market was way up , how great the economy is, today, the market isn't going up until we get transparency on the financials. The quintessential traders thought process.

Realistically, expect the Fed to be back in the game lowering rates if the markets don't regain their footing shortly. And how about Barton Bigg's big prediction yesterday saying how the markets are going to rip higher into the end of the year because of under invested hedge funds. Maybe, but not starting today.

Finally, I look for markets to rebound regardless of the jobs number tomorrow.

MORE OCTOBER PUNCHED

Performance data on more selected equities for the 10 months ended October 31:

APC +35.6%

BHP +119.5%

CAM +83.5%

CNQ +56.3%

FCE.A -2.5%

FCX +111.2%

GE +10.6%

LTR +18.4%

LUK +79.6%

MS -2.8%

MTW +65.7%

PG +8.2%

RIO +153.4%

SYK +28.8%

TROW +46.8%

TXT +47.6%

And from the nice folks at the WSJ- check the 10 biggest market caps:

XOM-500B

GE 415B

MSFT 330 B

T 250 B

GOOG 215B

BAC 215B

PG 215B

C 200B

BRK.A 200B

CSCO 200B

THE CRUSH

Hard to believe all of yesterday's gains went poof at the open but there it was. Anyhow, DJIA -210, NAZ -37 and SPX -25. The RUT (-2.5%) and value stocks far and away the biggest losers.

The reason, C downgraded and talk of a cut of the dividend and a stock price in the low 30's. Sounds like the Prince will be out the door shortly.

Morning stats:

NYSE - 2,200 net losers;

NAZ -1,700 net losers;

OEX 5 GREEN;

NDX 15 GREEN;

IBD 100-4 GREEN;

Down Volume about 15x up volume;

TRIN- 1.97 and rising rapidly;

VIX up about 13% and so much for the sell signal from yesterday;

Green stocks INTC NMX AMGN XRAY SNDK IACI BRCM XLNX MRVL PTEN CSCO DISH LINTA TYC ABT CSCO PG MTD KO BMY;

Red stocks- just about all the rest;

Biggest losers- CROX MTW C MS BG UA FCX NOV ABX FTK PKX FSTR VIP BBL BHP MICC S GRMN ERTS MNST;

Sectors down the least include drugs, utils, semis, biotech and large cap value- worst include banks, brokers, emerging markets, china, homies and metals.

Areas of support now that SPX 1,540 is gone, the 50 day SMA - 13,680 on the DJIA and 1,512 on the SPX.

A rally in the early afternoon would not surprise me and I will probably look to buy for a short term flip.

OCTOBER PUNCHED

The tenth month is done and here is how is major indexes/etf's/shark stocks have done for the year:

SPX +9.2%

DJIA +11.8%

NDX 27.4%

COMPQ +18.4%

OEX +9.7%

MID +12.8%

RUT +5.1%

DWC+9.9%

MSH +20.2%

XLK +22.1%

HHH +25.1%

GOOG +53.5%

AAPL +123.9%

MSFT +23.3%

INTC +32.8%

SMH +2.9%

Small Value -4%

Small Growth +20.4%

Large Value +5.6%

Large Growth +16%

EFA +17.6%

EEM +46.4%

EWA +47.3%

XBD -1.8%

BKX -12.1%

GS +24.4%

MER -29.1%

CME +30.7%

ICE +65%

NYX -3.7%

IBB +11.4%

DRG +1.8%

AMGN -14.9%

OIH +36.1%

XLE +30.8%

VLO +37.7%

XTO +41.1%

HUI +28.6%

PAAS +31.6%

SSRI +38.1%

LVS +48.7%

WYNN +72%

MGM +59.7%

TIF +38.1%

BAM +27%

HGX -32.4%

TRAN+7.6%

XAL -20.2%

RLX -7.7%

DFX +26.1%

ITA +32.8%

LVLT -45.9%

MO +11.2%

The surprising number, the small cap growth, which is up double the SPX/OEX, with all the talk about big caps and companies with overseas exposure, small caps will under perform. Well maybe not.

THE NICE CLOSE

There we have it, a higher close on the DJIA by 138, NAZ +42 and SPX +18 leaving 1,540 in the rear view mirror and about 25 points off the all time high. Surprisingly, MID's were the best performers on the day followed by the NAZ/NDX with the BIG CAPS being the laggards.

Strongest sectors- metals, china, oils, emerging markets, brokers and real estate while gaming, airlines and homies were in the red.

Key stocks- 32 out of 40 in the green led by MA MTW POT ICE VMW MSFT and GS while GRMN WYNN OVS UA DECK were the biggest losers.

NYSE - 1525 net green;
NAZ -910 net green;
NDX 80 WINNERS;
OEX 90 WINNERS;
IBD 100-80 WINNERS;
IBD 20- 100% GREEN;

Biggest winners- MICC APOL ADSK PTEN IACI NXY MSFT LEH GS COP MS MA EXM SNP DSX DRYS BTJ HDB OII;

Biggest losers- HURN GRMN WX ARGN FTK VIP TGT TYC C WMT BAX WB BUD WYNN AMLN JAVA XMSR AKAM VRSN EBAY;

VIX - down 12% and yikes - 10% under the 10 day SMA- first time in quite a while;

Up volume almost 4x down volume;


Two day RSI's:

SPX 81
DJIA 81
MID 85
RUT 78
NDX 94

So short term indicators on the overbought side and look at the DJIA -13,930 and 70 points from the 14k round number which has been a sell level on prior occasions. However, keep in mind that we are now at a seasonal strong period and the first few days of a month usually means higher prices as new money comes in for retirement funds etc.

FED CUTS

There it was, a 25 bps cut in both the fed and the discount rates. Market reaction- a 100 points selloff in the DJIA and a big dip in the brokers/banks as the bias appears to have been changed to neutral as the fed sees high oil prices and maybe doesn't want to take the eye off the inflation ball. And as soon as I type, markets are back up near the highs of the day. Resilience or stocks just got cheaper as fed rates just went lower?

The rate on the ten year has also soared after the announcement to 4.47% after being under 4.4 for most of the day.

MID's still the best sector for the day as we now have retail, airlines, gaming, banks, insurance and homies in the red.

And the funny Bill Gross asked for his favorite trade - "any non dollar asset."

The non dollar assets of oil and metals have been acting well today and I will agree with Gross on that trade going forward, buy the non dollar assets on the dips.

NOON BLIP

Markets are solidly higher in front of Ben's 2;30 announcement and he better deliver the 25bps cut cause if he doesn't well we probably close lower. A 50bps cut probably gets the DJIA to near the 14k level.

Best performing index today to the chagrin of the big cap bulls- the midcaps which are ahead of the bigcaps year to date also although not quite at the NAZ/NDX levels.

Strongest sectors- China, metals, oils, emerging markets, financials, real estate, reits and brokers while airlines and gaming lag.

NYSE - 1340 net winners;

NAZ 640 net winners;

NDX 63 WINNERS;

OEX 80+ WINNERS;

IBD 100- 75+WINNERS;

VIX down by 6% and about 4% under the 10 day SMA;

WINNERS- NXY MSFT ATI WMB COP MS GS MA SNP DRYS DSX EXM BTJ SSRX MICC PTEN SEPR APOL SIRI LINTA IACI MNST ERTS XMSR;

LOSERS- NIHD GRMN WYNN AMLN AKAM FLEX GENZ UAUA JAVA LAMR HURN ARGN MORN ANSS FTK CMTL WX PAY GMCR;

So one day after the sell call on oil from GS, crude approaches $94 and oil stocks follow as they are up about 2.25% today.

WYNN LVS hammered on the heels of last nights numbers from WYNN- good but not good enough as the stocks have soared of late. Time to buy- eh yes - although I scaled still looking for a further drop but like the longer term picture as Macau supposedly 2x Vegas within a year or two.

DIPPING

Markets are trading up after futures indicated a nicely higher ap open. However, we were rejected yet again at the 1,540 level on the SPX and the afternoon trade will be quite interesting as we get the rate decision from Friendly Ben. A lift higher could put 1,540 in the rear view mirror and and it can become future support.

Strong sectors this AM include metals, financials, brokers, china, emerging markets and oils while gaming, airlines, retail, defense and biotech lag.

NYSE internals- +800;

NAZ internals +260;

NDX internals 65 GREEN;

OEX internals 70 GREEN;

IBD 100- 70 GREEN;

Key stocks- 75% green led by MA VMW BIDU ICE GS MS BAM GOOG JPM CME- losers WYNN GRMN UA LVS DECK MTW AMZN KLAC RIMM COST MER and MGM;

Biggest winners- MA DSX EXM DRYS SSRX GSOL VMW MTL MICC DELL LEH COF ATI MS HIG GS HIG ORCL XMSR SIRI ERTS IAIC APOL MNST SEPR ATVI LINTA;

Biggest losers- NIHD GRMN AMLN WYNN AKAM GENZ TGT BHI SLB TYC HAL BAX EK AA FLEX WFMI BRCM HURN ARGN ANSS FTI CMED CMTL PFWD FTK MORN EXLS;

GS up about $4 and near the all time high of $246 and I will stick with a short term target of $250. It was back at $160 mid August so not bad for the dippers. OIH a different story as it is again having problems making headway despite the morning rise in crude. Inventory numbers in a few moments and that will no doubt move the OIH one way or the other.

Some stocks that look like they may be in for bounce include GRMN CELG NOV FTK CAM SLB WYNN LVS.

CLOSING MARKETS

A dreary, boring day on the street with oils, metals, shipping, emerging markets and gaming all acting funky while tech, airlines, reits, real estate and homies outperformed.

Key stocks belong to many of the funky sectors and most closed in the red including LVS DECK WYNN MER XOM POT MGM AMZN CELG and MTW while UA NVDA MSFT GOOG and KLAC closed in the green.

NYSE internals- 740 net losers;

NAZ internals -800 net losers;

NDX -40 WINNERS;

OEX -30 WINNERS;

IBD 100- 15 WINNERS;

IBD 20- 3 WINNERS;

Biggest winners- SEPR UAUA NVDA GENZ ERTS ALTR MSFT GOOG AVP CL EK DELL GM BAX WY SSRX ARGN EJ BIDU AAPL SCHN PFWD ISRG;

Biggest losers- EXM DRYS DSX FTI BTJ CAM OII CYNO VIP NOV ATI PG SLB HAL CVX MER XOM AA XMSR SIRI WYNN LVLT JOYG TLAB YHOO NIHD;

VIX up 5% back to the 21 level and a few % above the 10 day SMA;

OIH SLB CAM HOC NFX VLO XOM APC XLE all drilled down hard and may be approaching a buy area although the OIH has now dipped under the 50 day SMA. I suspect this is more a buying opportunity than a time to sell as oil dips under $90.

SPX again rejected at the 1,540 level or the 20 day SMA. This has been resistance for about 2 weeks and I suspect tomorrow we either break above and it becomes support or we sink under with a no go from Big Ben.

I suspect most traders want tomorrow and Friday (jobs number) out of the way so the seasonals can take over and restart the bull.

AFTERNOON CHECK

Tech seems to be the place today as stalwarts AAPL AKAM AMAT BIDU CSCO GOOG MSFT NVDA RIMM SNDK and TXN are all leading the NAZ/NDX up despite a down performance by the SPX/DJIA. Small cap value also fighting the trend and in the green.

Strongest sectors include airlines, reits, real estate, semis, utils, tech and trannies while oils, metals emerging markets and gaming are all solidly red.

Key stocks- almost flat led by UA NVDA BIDU KLAC GOOG ISRG MSFT and AAPL while MER LVS MGM MTW CELG and XOM are solidly red.

NYSE internals - 320 net red;

NAZ internals - 430 net red;

NDX -45 GREEN;

OEX 40 GREEN;

IBD 100- 25 GREEN;

Biggest winners- SSRX ARGN EJ BIDU SCHN GOOG AVP EK CL MSFT WMT BMY BA BAX SEPR NVDA UAUA KLAC ERTS ISRG;

Biggest losers- XMSR SIRI LVLT JOYG TLAB NIHD TEVA PG ATI HAL CVX MER SLB XOM AA FTI BTJ CAM CYNO OII GMCR GSOL;

Lots of high flyers in the energy/metals/ag patch getting hit hard today and I suspect a buying area as the end of the era in oil has been called several times and it keeps moving higher. This time probably no different.

IBD 20 now includes - AAPL ABX AMZN BLK CELG CME FCX GILD GOOG HAL HPQ MOS NOV NYX PCP POT RIMM VMW XTO YHOO- a pretty nice group of stocks and I will be picking some up on dips.

SAME OLD SAME OLD

Markets open lower on the heels of a crummy consumer confidence number and general over bought market conditions. The DJIA is -50, NAZ -7 and the SPX -7. The big caps are actually the worst performing sector as RUT/MID are down less.

Strongest sectors include airlines, reits, utils, semis and drugs while oils, metals emerging markets and homes are getting hammered.

Key stocks generally lower with NVDA GOOG KLAC BIDU MGM GS MSFT and COST green and VMW MER CELG XOM GRMN MA UA BAM MTW the reddest.

NYSE internals- 730;

NAZ internals -655;

NDX - 30 WINNERS;

OEX -40 WINNERS;

IBD 100- 25 WINNERS;

Biggest Winners- NVDA GOOG ARGN SSRX CF CNH EJ SCHN SLT GOOG PFWD FTK SEPR AMAT KLAC WYNN ADBE SNDK AVP GM CSC BMY BAX TGT;

Biggest Losers- PG HAL MER EMC ATI CVX SLB FTI CYNO CAM OII FSTR GSOL GPOR YHOO NIHD TEVA XMSR JOYG SIRI TLAB INFY PAYX;

VIX up about 4% and the trading range continues;

Oils are getting crushed this morning with the OIH down about 2.5% as CAM SLB NFX XOM APC are all getting whacked. Tech is holding up pretty well as the NDX is near the unchanged line. SMH AAPL BIDU EBAY GOOG MSFT NVDA TXN all trading green. The usual suspects in gaming land also defying the days trend by trading higher- MGM WMS WYNN.

I suspect the early strength in tech and GS may bring the markets higher before the closing bell sounds.

And congrats to Stan O'neil for getting the Nardelli type package for Nardelli like performance. Well maybe he oversaw a bit more losses than Nardelli but you get the picture.

THE CLOSE

Markets closed the day higher with the DJIA being the biggest index winner while the RUT/MID and Small Cap Value closed flattish. Oh and Yankee fans waved goodbye to Donnie Baseball.

Strongest sectors included China, emerging markets, metals, gaming, semis, brokers and utils while internets, real estate, reits and biotechs lagged.

Key stocks generally higher led by VMW GRMN WYNN MTW POT LVS GS NYX and COST. Losers included ISRG NVDA UA CAT MSFT JPM and TIF.

NYSE inernals +500;

NAZ internals FLAT;

NDX 60 GREEN;

OEX 65 GREEN;

IBD 100- 70+ GREEN;

Biggest winners- MRVL JNPR GRMNNICH SNDK WYNN JOYG AKAM WY NXY LEH GS EMC EK AA SSRX STP FMCN FSTR VMW FTK TDG SNHY EDU;

Biggest losers- SCHN GPOR TISI GSOL ARGN ANSS ISRG HIG BHI JPM HAL CAT CMCSA TWX HPQ WFC YHOO NVDA NTAP SEPR BIIB;

A pretty decent day for this fish as BAM CNQ EWA GS MGM MS MTW PAAS RIO SSRI and TROW all had nice moves.

Looks like resistance remains in the 1,540 area on the SPX as the markets were again rejected while NDX futures hit their highs in the early morning trade. Probably not much activity tomorrow as all eyes will be on the Wednesday fed announcement.

NUMBERS

Markets continue to trade higher and they are getting a little over bought in the short term. FTSE closed up 1.6%, DAX +.8% and CAC +.6%.

The 1,540 number (20 day SMA) on the SPX has been noted a few times as resistance and here we go again. Some 2 day RSI numbers:

SPX 92

OEX 92

DJIA 95

RUT 76

NDX 74

COMPQ 80

MID 81

MON 97

POT 99

GS 98

NDAQ 100

NYX 99

KO 99

MCD 97

PEP 97

PG 97

LVS 98

MGM 91

WYNN 97

MRK 98

PPH 96

ABT 99

MTW 92

JOYG 95

BHP 86

FCX 94

SSRI 97

PAAS 97

XRT 91

XLE 92

CNQ 97

RIG 94

XOM 90

XTO 91

MSH 67

SOX 53

SMH 45

HHH 56

VIX/VXO not in sell territory but are trading under their 10 day SMA's.

OPENING WINNERS

Markets trade higher yet again with leadership from gaming, metals, emerging markets, semis and utils. Laggards include airlines, trannies, biotechs and internets.

Key stocks- 25 out of 40 in the green led by WYNN LVS POT BIDU MTW VMW UA MS COST and GS (new hi).Laggards- NVDA ISRG DECK CELG IBB NYX.

Up Volume more than twice down volume;

VIX Flattish;

222 New Highs on NYSE v 23 New Lows;

Market internals, strong with 900 net gainers on the NYSE and about 400 net green on the NAZ.

NDX 60 GREEN;

OEX 70 GREEB;

IBD 100- 75 GREEN;

Biggest Gainers- LVS WYNN AKAM DELL NIHD SNDK MRVL WFMI LRCX JNPR SYMC SSRX HDB FTK EDU CMED WX SLT WY LEH COF LTD MS AES;

Biggest Losers- HIG BHI GD HPQ FDX UPS AMGN SCHN TISI SNCR ISRG CMG MICC NTAP YHOO UAUA SEPR ERIC FAST;

Gold close to a new high, SPX about 35 points from the highs, DJIA about 300 points away and OIL at a new high. Bottom line, dollar isn't worth a whole heck of a lot and the SEMIS are up for what seems the first time in a month.

Markets look to be heading higher and new higher probably in the next few weeks.