Message-ID: <10803881.1075855602530.JavaMail.evans@thyme> Date: Mon, 7 May 2001 14:42:00 -0700 (PDT) From: evening@ino.com To: mike.grigsby@enron.com Subject: Trader, Monday S&P -3.10 CRB -1.31 NAS -17.98 USD +0.39 DOW -21.80 Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: "INO.com" <evening@ino.com> X-To: "Trader And INO User" <mike.grigsby@enron.com> X-cc: X-bcc: X-Folder: \Michael_Grigsby_Jun2001\Notes Folders\Discussion threads X-Origin: Grigsby-M X-FileName: mgrigsb.nsf M O N D A Y E X T R E M E M A R K E T S A complimentary service from INO.com ( http://www.ino.com/ ) Monday: The CRB Index has retreated 1.31 points to 214.62. The US Dollar Index moved up 0.39 points to 115.32. The Dow Industrials declined 21.80 points, at 10935.17, while the S&P 500 slipped 3.10 points, last seen at 1263.51. The Nasdaq Composite moved down 17.98 points to 2173.55. 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All Products Guaranteed. _____________________________________________________________________ E X T R E M E M A R K E T C O M M E N T A R Y _____________________________________________________________________ The STOCK INDEXES were lower on Monday in subdued trading as many players remained on the sidelines ahead of this week's economic news. Overall losses were limited due to gains in chip stocks. Both indexes are at important crossroads as they are challenging April's highs. Multiple closes above these resistance levels are needed to extend this spring's rallies. At the same time, momentum indicators are overbought warning bulls to use caution as short-term tops might be in or near. The Dow closed lower on Monday but near mid-range. Light support came from drug and cyclical stocks. Gains in Caterpillar, Eastman Kodak and IBM also provided support for the Dow. Momentum indicators remain bullish signaling that a test of February's high crossing at 11,035.10 is still possible this month. INTEREST RATES June bonds closed lower on Monday as they extended last Friday's loss. Expectations are running at 80-90% that the Fed will cut interest rates by another 50-basis-points at its May 15th FOMC meeting following last week's larger-than-expected unemployment report. Today's setback was no big surprise giving last Friday's poor close. Nevertheless, last week's breakout above this spring's downtrend line signals that a short-term bottom and trend change has taken place. Momentum indicators remain bullish signaling that sideways to higher prices near-term are possible. If June resumes last week's rally the 50% retracement level crossing at 103-20 is a potential target. The CRB INDEX closed lower on Monday due to weakness in grains, bellies and energies. Today's decline turned a number of momentum indicators including stochastics bearish warning traders that last week's high might have marked a double top with April's high. Closes below 212.64 would open the door for a larger- degree decline during May. ENERGY MARKETS closed lower on Monday due to profit taking that was triggered by comments made by President Bush who indicated his concerns over high retail energy prices. Additional pressure came from expectations that this week's API data will once again show stocks rose last week. Retail gasoline prices are running at record highs, eclipsing last June's levels amid a series of disruptions at refineries that feed the gas-hungry U.S. market. June crude oil closed lower on Monday and in doing so turned a number of short-term momentum indicators neutral to bearish. Closes below last week's low crossing at 27.37 would confirm that the short-term trend has turned down. I would not be surprised to see a steady to higher close on Tuesday due to light short covering. Resistance begins at 29.40 then February's high crossing at 30.13. June heating oil closed sharply lower on Monday but remains within last week's trading range. Closes above 77.80 or below 73.10 are needed to confirm a breakout of a two-week trading range and clear up near-term direction in the market. Momentum indicators are neutral to bearish hinting that sideways to lower prices near-term are possible. June unleaded gas posted a key reversal down on Monday due to profit taking after falling short of testing weekly resistance crossing at 109.60. Additional weakness on Tuesday is needed to confirm today's bearish reversal pattern. However, it will take closes below trendline support crossing near 103-25 before a top and trend change can be confirmed. The weekly ADX (a trend-following indicator) remains in a bullish trend mode signaling that we could see additional gains this spring. June Henry Hub natural gas plunged below key weekly support crossing at 4.38 on Monday due to expectations that this week's AGA inventory data will continue to show natural gas supplies building. Today's plunge below key support crossing at 4.38 has opened the door for additional weakness and a possible test of the 75% retracement level of the 1999/2000 rally crossing at 3.625 later this spring. The rising ADX signals that additional weakness during May is possible. CURRENCIES The June Dollar closed higher on Monday and above April's uptrend line crossing near 115.27. Additional gains on Tuesday would increase the odds that last week's correction has come to an end. Momentum indicators are neutral to bullish signaling that sideways to higher prices near-term are possible. The June Swiss Franc and D-mark closed lower on Monday as they extended last week's narrow trading ranges. Closes above April's high or low are needed to clear up near-term direction in both markets. Momentum indicators remain bearish signaling that sideways to lower prices near-term are possible. The June Canadian Dollar closed sharply lower and below April's uptrend line on Monday thereby confirming last Friday's key reversal down and trendline breakout. With this spring's rally stalling out near the 50% retracement level of this year's decline and Monday's trendline breakout, the door is open for sideways to lower prices during May. Momentum indicators have also turned bearish signaling that additional weakness is possible. I would not be surprised to see a lower opening on Tuesday but would not rule out a short covering bounce. The June Japanese Yen closed higher due to a late- session rally as the market continues to challenge the upper boundary of this spring's trading range crossing at .8327. Multiple closes above this resistance level are needed to confirm a breakout and trend change. Momentum indicators are bullish hinting that additional gains are possible. PRECIOUS METALS June gold closed steady on Monday as it remains above April's uptrend line but below the long-term downtrend line crossing near 269. Momentum indicators have become overbought warning traders that June gold is at an important crossroads. Closes above or below the aforementioned support/resistance levels are needed to clear up near-term direction in the market. July silver posted an inside day with a lower close as the market fell short of testing the lower boundary of this spring's trading range crossing at 4.31. Closes below 4.31 are needed to confirm a trading range breakout and trend change. Momentum indicators are bearish but nearing their respective overbought zones hinting that this spring's trading range may remain intact for the time being. July copper posted an inside day with a higher close due to light short covering as it consolidated some of last Thursday and Friday's losses. Closes below last Friday's low crossing at 78.00 would turn a number of short-term momentum indicators bearish thereby increasing the odds that a short-term top was posted last week. GRAINS July corn posted a key reversal down on Monday as forecasts for increased precip across the dry eastern Corn Belt and a quiet export market weighed on prices. Trading is likely to remain subdued ahead of Thursday's supply/demand report. This afternoon's planting progress report showed that 58% of the U.S. corn crop is planted compared with 74% a year ago and 52% for the five-year average. This will likely add to the selling pressure on Tuesday, as planting delay fears will have been reduced. July's inability to close above broken support crossing at 2.11 underscores the weak tone surrounding the corn market at this point in time. July wheat closed sharply lower on Monday following widespread rains that fell across portions of the Plains over the weekend. Today's breakout below trendline support crossing near 2.71 fell short of testing March's low of 2.65 1/2. Closes below this support level would renew the long-term downtrend while setting the stage for a possible test of weekly support crossing at 2.50 later this summer. I would not be surprised to see a steady to higher close on Tuesday due to short covering following today's late- session bounce. Today's planting progress report showed that 35% of the spring wheat is planted compared with the five-year average of 50%. The crop conditions report for winter wheat showed that 26% is rated poor to very poor, 33% is fair and 41% is rated good to excellent. SOYBEAN COMPLEX July soybeans closed lower on Monday due to increased chances for rain across the eastern Soybean Belt this week. July soybeans continue to hold above broken trendline resistance as they extended last week's trading range. However, upside potential appears limited in the face of slowing export sales, burdensome carryout levels and increased U.S. planted acreage this year. If the rally off the late-April low resumes, this spring's high at 4.49 3/4 is July's next target. Momentum indicators are bullish but nearing their respective overbought zones hinting that a short-term top might be in or near. July soybean meal closed lower on Monday due to light profit taking and spillover selling from soybeans and wheat. Today's mid-range close leaves the door open for sideways to higher trading on Tuesday as last week's rally opened the door for a possible test of March's high crossing at 160.50 later this spring. Momentum indicators are bullish but nearing their respective overbought zones warning bulls to use caution. LIVESTOCK June hogs posted a potential downside reversal on Monday but held above the 2000-01 uptrend line crossing near 66.75. Multiple closes below this support level would confirm a trendline breakout while opening the door for a larger-degree decline this spring. Weekly momentum indicators have turned bearish signaling that additional weakness near-term is possible. June cattle closed higher on Monday as it extended last Friday's late-session short covering bounce. Signs of rising boxed-beef prices triggered today's rally. However, gains were limited by expectations for steady to $1.00 lower cash bids this week. Momentum indicators are oversold and diverging following last week's test of January's low. I would not be surprised to see additional short covering during the first half of this week. FOOD & FIBER July coffee resumed this spring's short covering rally as traders continue to build in a modest weather premium as winter approaches in Brazil. If this month's rally continues, March's high at 71.70 is July's next target. Momentum indicators remain bullish signaling that additional short-term gains are possible this week. July cocoa closed modestly higher in narrow trading as it continues to consolidate above this spring's lows crossing at 955. Closes above 1034 or below 955 are needed to clear up near-term direction in the market. July sugar closed lower on Monday due to profit taking hinting that the market might have priced in all of the bullish export news from Asia at this point in time. Momentum indicators are very overbought and turning neutral to bearish hinting that a short-term top is in or near. If the decline off last week's high continues, trendline support crossing near 885 is July's next target. Closes below this support level would confirm a short-term top has been posted. If the rally continues, this year's high crossing at 941 is July's next target. July cotton closed slightly higher on Monday as it consolidates near the bottom of this spring's trading range. Trading is likely to remain subdued ahead of this week's supply/demand report. Favorable moisture conditions across west Texas and the Delta along with burdensome carryout levels continues to limit gains in both old and new-crop cotton. Daily Extreme Commentary is brought to you by GLOBALcharts, INO.com's end-of-day charting software for Futures, Futures Options and Optionable Stocks. http://www.globalcharts.com Search the INO Store - http://store.ino.com/ _____________________________________________________________________ T O P N E W S _____________________________________________________________________ STOCKS Japan Stocks Review: Up 0.8%, little reaction to PM's speech http://news.ino.com/summary/?id=25255 US Equities Review: Lower in quiet, aimless trade http://news.ino.com/summary/?id=25254 UK Stocks Review: FTSE-100 bounces back despite US data hiccup http://news.ino.com/summary/?id=25261 FOREX US FX Review: Dollar mixed; euro pressured by weak data http://news.ino.com/summary/?id=25257 Asia FX Review: Koizumi speech fails to set JPY direction http://news.ino.com/summary/?id=25262 Europe FX Review: Poor U.S. jobs data sends dollar reeling http://news.ino.com/summary/?id=25256 CREDIT US Credit Review: Short end posts slim gains on rate cut hopes http://news.ino.com/summary/?id=25253 Europe Credit Review: US labor mkt weakness good news for bonds http://news.ino.com/summary/?id=25258 Japan Credit Review: Jun up but market lacks overall direction http://news.ino.com/summary/?id=25260 COMMODITIES US Futures Summary: Energy takes a dive; coffee jumps http://news.ino.com/summary/?id=25259 EXCHANGES CME Posts Record Open Interest On Second Busiest Day http://news.ino.com/press/?release=23558 ____________________________________________________________________________ E X T R E M E F U T U R E S ____________________________________________________________________________ Updated every 10 minutes around the clock. More at http://quotes.ino.com/analysis/extremes/futures/ WINNERS BDU1 Oriented Strand Board Sep 2001 224.60 10.00 +4.66 KCN1 Coffee 'C' Jul 2001 68.75 2.70 +4.08 LBF2 Random Length Lumber Jan 2002 309.50 9.50 +3.17 DBV1 Butter Oct 2001 190.000 5.000 +2.70 CCK1 Cocoa May 2001 1034 22 +2.17 SEN1 Sugar #14 Domestic Jul 2001 21.34 0.20 +0.95 NKH2 Nikkei 225 Stock Avg Mar 2002 14520 125 +0.87 HUF2 New York Harbor Unleaded Gasoline Jan 20 0.7750 0.0063 +0.82 HOH2 Heating Oil Mar 2002 7580 58 +0.77 ERY0 FTSE Eurotop 100 Cash 3286.3 21.8 +0.67 LOSERS DJU1 Dow Jones Industrial Avg. Sep 2001 110200 -660 -5.95 NGM1 Henry Hub Natural Gas Jun 2001 4.230 -0.260 -5.79 PBQ1 Frozen Pork Bellies Aug 2001 78.050 -3.000 -3.70 PNV1 Propane Oct 2001 0.5325 -0.0125 -2.29 HON1 Heating Oil Jul 2001 0.7525 -0.0172 -2.23 XWZ1 Wheat Dec 2001 295 1/2 -6 1/4 -2.09 HUM1 New York Harbor Unleaded Gasoline Jun 20 1.0630 -0.0213 -1.96 SMV1 Soybean Meal Oct 2001 146.7 -2.9 -1.94 NDM1 NASDAQ 100 Index Jun 2001 1903.00 -37.50 -1.93 CLM1 Light Sweet Crude Oil Jun 2001 27.77 -0.51 -1.80 ____________________________________________________________________________ E X T R E M E S T O C K S ____________________________________________________________________________ Updated every 10 minutes around the clock. More at http://quotes.ino.com/analysis/extremes/stocks/ WINNERS MGAMW MULTIMEDIA GAMES WRRT'A' 6.10 1.80 +41.38 LNOP LANOPTICS LTD 12.05 3.40 +39.31 BWE BANCWEST CORP 34.31 9.35 +37.43 PXCM PROXICOM INC 7.44 1.78 +31.45 PYR PYR ENERGY CORP 6.73 1.48 +28.19 AMSC AMER SUPERCONDUCTOR 19.01 4.11 +27.40 NIS NOVA CORP 29.05 5.73 +24.36 CRDS CROSSROADS SYSTEMS 8.55 1.63 +23.55 LSBC LARGE SCALE BIOLOGY 6.10 1.10 +22.00 ARRY Array BioPharma 6.45 1.14 +21.47 LOSERS PRSF PORTAL SOFTWARE INC 5.93 -3.38 -36.42 HMNF HMN FINANCIAL 13.75 -5 -35.71 TMTA TRANSMETA CORP 11.17 -3.40 -23.34 MAXC MAXCO INC 7.50 -1.43 -19.07 CANI CARREKER CORP 21.22 -4.83 -18.54 CRXL Crucell N.V. ADS 5.75 -1.27 -18.09 IVAC INTEVAC INC 5.30 -0.83 -14.19 PMSI PRIME MEDICAL SERVICES 5.25 -0.82 -13.40 CTCI CT COMMUNICATIONS 13.00 -2.00 -13.33 KOSN KOSAN BIOSCIENCES 8.30 -1.24 -13.30 FREE MANAGED FUTURES & IRA RETIREMENT KIT http://www.ino.com/specials/icm/ _____________________________________________________________________ T H A N K Y O U _____________________________________________________________________ Thank you for subscribing to the Extreme Markets Daily Digest from INO.com ( http://www.ino.com/ ). If you want to subscribe to our other email services, or would like to modify your profile please visit http://www.ino.com/email/. To subscribe a friend, visit: http://www.ino.com/email/ To unsubscribe, visit: http://www.ino.com/email/remove/?email=mike.grigsby@enron.com&list=evening -- Copyright 1998-2001 INO.com. All Rights Reserved.