Two

December 27, 2001
Kevin Haggerty

Yesterday
was less than average NYSE volume, with
a positive volume ratio of 71 and breadth at +679. The three major indices
finished positive, with the SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) and Dow +0.6%, and the NDX
(
$NDX.X |
Quote |
Chart |
News |
PowerRating)
+1.05%. The first hour was the game for daytraders, as we are interested in the
stocks that the Generals are playing mark-up with into year-end. The intraday
high for the SPX was 1159 on the 10:30 bar, then sideways until the last-hour
decline starting on the 3:00 p.m. bar took the index down to an 1149.37 close.

All three indices
declined in the final hour, although all made their intraday highs at different
times, with the DJX
(
$DJX.X |
Quote |
Chart |
News |
PowerRating) actually hitting its intraday high on the
2:50 bar, at 101.69, closing at 100.88. The DJX is in a trading range right at
the 200-day EMA, which is 100.21, with the upper boundary at 101.69 and the
lower at 96.92. The lowest moving average is the 50-day EMA at 98.06, and then
just air underneath.

The SPX is still bumping
around the 1150-1160 resistance zone with what could be rally-ending resistance
from 1174-1208. It made one attempt, hitting 1173.62, before immediately
declining to 1104 in six days. The .618 retracement to the May high is 1174,
which is also the .38 retracement to the all-time high of 1553 made in March of
2000. On the monthly chart, 1175 is the 12-month EMA, and this is the third
monthly bar up into this moving average. If they can get it through this level,
then this 1174 level becomes a key downside pivot if it is to retest the
September bottom, which I think it will.Â

The Middle East energy
play was on again, as the
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) led all sectors at +3.8%. These are
trading plan staples during the turmoil because they move as a sector, and you
just wait for the green.

Stocks
Today

Have a good trading day.

Five-minute chart of
Wednesday’s SPX with 8-, 20-,
60- and 260-period
EMAs

Five-minute chart of
Wednesday’s NYSE TICKS

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