Message-ID: <4086047.1075840989173.JavaMail.evans@thyme> Date: Wed, 16 Jan 2002 14:32:09 -0800 (PST) From: evening@ino.com To: alewis@enron.com Subject: Andrew, Wednesday NAS -56.47 CRB +1.32 DOW -211.46 USD +0.28 S&P -18.62 Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: "INO.com" @ENRON X-To: Andrew Lewis X-cc: X-bcc: X-Folder: \ExMerge - Lewis, Andrew H.\Deleted Items X-Origin: LEWIS-A X-FileName: andy lewis 6-25-02.PST W E D N E S D A Y E V E N I N G E X T R E M E M A R K E T S A complimentary service from INO.com ( http://www.ino.com/ ) Wednesday: The CRB Index has gained 1.32 points to 194.32. The US Dollar Index edged higher by 0.28 points to 117.57. The Dow Industrials edged lower 211.46 points, at 9712.27, while the S&P 500 eased 18.62 points, last seen at 1127.57. 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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 http://quotes.ino.com/exchanges/?c=indexes Stock indexes closed sharply lower on Wednesday as they renewed their declines off last week's highs. Today's declines have set the stage for a likely test of December's lows in the near future. Waning optimism over an early economic rebound this year along with profit taking following the huge run up off last September's lows continues to weigh on both indexes. The NASDAQ closed down 56.47 points at 1944.44. The March S&P 500 index also closed sharply lower on Wednesday negating Tuesday's key reversal up. The March S&P 500 index closed down 22.50 points at 1126.50. The Dow closed sharply lower on Wednesday and is challenging the late-fall lows crossing at 9691.13. Closes below this support level could lead to a test of November's reaction low crossing at 9408.50 later this month. Today's sell off was triggered by a sharp sell off in 3M over renewed concerns over asbestos litigation. This pressured other chemical companies on concerns over asbestos liabilities. Intel was also lower on the day as fourth quarter net income fell 77%. INTEREST RATES http://quotes.ino.com/exchanges/?c=interest March T-bonds closed modestly lower on Wednesday as the market continues to ponder whether or not the Fed will cut interest rates at the end of January or not. Feb funds are now only predicting a 46% chance for additional interest rate cuts later this month. The Beige Book report indicated that economic activity remained weak from late November through early January. While there are still signs of caution, there are also scattered reports of improvement. This helped limit today's loss in March bonds, which remains above the 38% retracement level of last fall's decline crossing at 103-06. If the rally off December's low continues, the 50% retracement level crossing at 104-25 being the next upside target. The CRB INDEX http://quotes.ino.com/exchanges/?c=indexes The CRB index closed higher on Wednesday extending its rebound off Tuesday's low, which spiked below December's uptrend line. Closes above last week's high at 195.97 are needed to renew its rally off last October's low. Support came from higher energy, grain, precious metal, fiber and some food prices. ENERGY MARKETS http://quotes.ino.com/exchanges/?c=energy The energy markets closed higher on Wednesday as a short covering rally that began in heating oil pulled the rest of the complex higher into the close. Early weakness was due to fallout from Tuesday's bearish API inventory reports. However, today's DOE inventory reports painted a less bearish picture for inventories, which allowed for modest short covering gains on the day. March crude oil modestly higher due to light short covering but remains below the November-December uptrend line, which was broken on Monday. Today's DOE inventory report failed to provide enough of a catalyst to send crude oil prices through this broken support level thereby leaving the door open for sideways to lower prices into late-January. Stochastics and the RSI are bearish signaling that additional weakness is possible near-term. March heating oil closed higher on Wednesday due to a late- day short covering rebound. Early weakness led to a test of this week's low at 51.50. However, March's failure to push prices below this minor support level forced locals to cover ahead of the close. The rally pulled the rest of the complex higher on the day. Momentum indicators are bearish but becoming oversold hinting that March could be forming a possible triple bottom. March unleaded gas closed higher on Wednesday. Early weakness led to a test of the Nov.-Dec. uptrend line crossing near 54.85. Closes below this uptrend line would open the door for a test of December's low crossing at 53.00 later this month. Stochastics and the RSI remain bearish signaling that additional weakness is possible into the last half of January. February Henry Hub natural gas closed higher on Wednesday and above the upper boundary of last week's trading range crossing at 2.335. Multiple closes above 2.335 will confirm today's breakout thereby opening the door for a possible short covering bounce during the last half of January. This week's AGA inventory report released today indicated that U.S. gas storage is 77% full. Short-term momentum indicators are turning bullish signaling that a short covering bounce is likely to unfold near-term. CURRENCIES http://quotes.ino.com/exchanges/?c=currencies The March Dollar closed higher on Wednesday and above last week's high crossing at 117.80 thereby opening the door for a possible test of December's high crossing at 118.85 later this month. Stochastics and the RSI have turned bullish with this week's turnaround in prices signaling that sideways to higher prices are possible near-term. The March Swiss Franc posted an inside day with a higher close due to short covering on Wednesday but remains in a minor downtrend off this month's high. The inverted head and shoulders bottom, which I have talked about this week, continues to form. However, closes above neckline resistance crossing near .6073 are needed before this bottoming formation can be confirmed. The March Canadian Dollar closed sharply lower on Wednesday erasing most of the gains of the past three trading sessions and falling back into this winter's trading range. March's inability to sustain Tuesday's breakout above minor resistance crossing at .6290 leaves the door open for sideways trading to continue into the last half of January. The March Japanese Yen closed lower on Wednesday but remains above this fall's downtrend line. Closes above last Monday's high crossing at .7696 are needed to confirm this week's trendline breakout. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible during the last half of January. PRECIOUS METALS http://quotes.ino.com/exchanges/?c=metals February gold closed sharply higher on Wednesday thereby ending this week's setback off last week's high. February posted its highest close of the year and closed at the 62% retracement level of last fall's decline crossing at 287.60. Today's rebound returned short-term momentum indicators including stochastics and the RSI to bullish modes thereby signaling that additional gains are possible. If the rally off December's low continues, the 75% retracement level crossing at 291.40 is February's next target. Today's rally was due in large part to a flight to quality move on the part of investors concerned over declining stock values. March silver posted an inside day with a lower close on Wednesday signaling that the bounce off Tuesday's low might be ending. Closes below the 38% retracement level of November's rally crossing at 4.498 and this week's low at 4.46 are needed to renew its decline off last week's high. Momentum indicators are bearish signaling that sideways to lower prices are possible during the last half of January. March copper closed higher on Wednesday but remains in a sideways to lower trend off last week's high. Uncertainty over the direction of the U.S. economy and when we will begin to see the much talked about economic recovery has left many copper traders on the sidelines for the time being. Nevertheless, as long as March holds above 69.50 the door will remain open for a possible run at November's high crossing at 73.70 later this winter. GRAINS http://quotes.ino.com/exchanges/?c=grains March corn closed higher due to a late-session rally on Wednesday. Early weakness was tied to a lack of fresh market moving news following last Friday's friendly USDA reports. However, Argentina released their 2001-02 corn production projections that were the lowest since the mid- 1990's. Additional support came from continued dryness concerns across Southern Brazil, which are having a yield impact on their corn crop. March closed above last year's downtrend line crossing near 2.13. Closes above Monday's high crossing at 2.15 1/4 are needed to confirm today's breakout thereby signaling that a major bottom and trend change has taken place. March wheat closed higher on Wednesday due to spillover support from corn and soybeans. March gapped below initial trendline support on the open but quickly turned higher due to a lack of follow-through selling after the open. Technically the wheat market is still overbought despite today's rebound thereby leaving the door open for sideways to lower prices near-term. Stochastics and the RSI have turned bearish with this week's decline hinting that sideways to lower prices are possible during the last half of January. The wheat market will need to see increased foreign buying and or another weather related scare either out of South America or the Plains regarding the U.S. crop to trigger additional buying interest. Until then, March wheat remains vulnerable to additional weakness and a possible test of December's uptrend line crossing near 2.90. SOYBEAN COMPLEX http://quotes.ino.com/exchanges/?c=grains March soybeans posted a key reversal up on Thursday triggered by bullish rumors in the meal pit. Additional support came from this morning's NOPA crush report. December's crush came in at 148.771 million bushels up 4.097 million bushels over November. Early Losses were limited following the USDA's announcement that 188,975 metric tonnes of U.S. soybeans were sold to an unknown destination. March posted its highest close since early-December and is poised to test November's high crossing at 4.57 1/2 possibly later this week. Momentum indicators are bullish but indicate that March is becoming overbought and will likely pause if not setback following an attempt to test November's high in the near future. Weekly momentum indicators have turned bullish signaling that sideways to higher prices are possible into late-winter/ early spring. The market will continue to keep a close eye on weather forecast for Southern Brazil as hot- dry weather is expected to continue into the early part of next week. March soybean meal closed sharply higher on Wednesday falling just short of testing the 62% retracement level of the July/January decline, which crosses at 163. Reports of problems with fishmeal in Europe triggered today's late rally in soybean meal, which is a key substitute for fishmeal. However, the $21 run up in meal prices since the first of the year has pushed the meal market into an overbought condition leaving it vulnerable to a round of profit taking should any negative news hint the market. While there is an outside chance that March meal could test the 75% retracement level of the aforementioned decline crossing at 168 later this week, a short-term top appears to be near. LIVESTOCK http://quotes.ino.com/exchanges/?c=livestock April hogs closed lower on Wednesday following a higher opening due to higher cash bids. Early strength failed to trigger follow-through buying, which allowed light commercial selling and profit taking to pressure the market into the close. However, losses were limited, as cash fundamentals remain strong. Early calls for Thursday's cash bids are coming in steady to higher. April cattle closed lower on Wednesday amidst a lack of cash sales and lower midday boxed beef prices. Losses were limited as traders are still expecting to see higher cash bids this week along with a friendly monthly cattle-on-feed report on Friday. April fell back into this year's trading range as it consolidated some of this week's gains. Closes above Tuesday's high would set the stage for a test of October's highs crossing at 75.45 later this month. Momentum indicators remain bearish warning bullish traders to use caution, as a short-term top appears to be near. Closes below 72.90 are needed to confirm this. FOOD & FIBER http://quotes.ino.com/exchanges/?c=food March coffee closed lower on Wednesday confirming Tuesday's downside reversal. Origin and local selling pressured the market today following the latest Green Coffee Association stocks report showed an increase in U.S. warehouse stocks. Losses were limited as producer selling dried up near session lows. Momentum indicators are beginning to turn bearish as they near their respective overbought zones hinting that a short-term top is in or near. March cocoa closed higher on Wednesday as they extended Tuesday's short covering rebound. However, session highs failed to fill Monday's gap at 1355. Today's high-range close leaves the door open for a firmer opening on Thursday. However, momentum indicators remain bearish signaling that this week's breakout below the November-December uptrend line signaled that a short-term top is in place. Closes below Tuesday's low at 1260 are needed to confirm this week's trendline breakout thereby opening the door for a larger-degree decline into the end of January. March sugar closed higher on Wednesday but near session lows hinting that this week's short covering rebound might have come to an end. Session highs fell short of testing last week's high at 805. Closes above 805 or below this week's low at 758 are needed to clear up near-term direction in the market. Short-term momentum indicators have turned bearish indicating that sideways to lower prices are possible during the last half of January. March cotton closed higher on Wednesday thereby confirming Tuesday's key reversal up. However, a sell off ahead of the close tempered some of today's gains while leaving the door open for sideways trading on Thursday. This week's export sales report due out tomorrow morning before the open will set the tone for trading possibly for the balance of the week. This week's rebound indicates that the market has discounted last Friday's bearish USDA report and is conformable with March cotton remaining range bound for the time being. 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/ _____________________________________________________________________ I N O N E W S _____________________________________________________________________ NYMEX Options Trading Continues To Hum http://news.ino.com/press/?release=27714 Computershare And Deutsche Borse Announce Joint Venture http://news.ino.com/press/?release=27713 J.P. Morgan Takes Equity Stake In TradeWeb http://news.ino.com/press/?release=27712 OM Strengthens Relationship With BrokerTec http://news.ino.com/press/?release=27711 ____________________________________________________________________________ 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 NGG2 Henry Hub Natural Gas Feb 2002 2.394 0.099 +4.32 SMH2 Soybean Meal Mar 2002 162.7 4.9 +3.10 XEH2 Soybean Meal Mar 2002 162 4.1 +2.60 CCU2 Cocoa Sep 2002 1296 32 +2.53 LBH2 Random Length Lumber Mar 2002 262.00 6.40 +2.50 PAH2 Palladium Mar 2002 424.00 10.00 +2.42 HOG2 Heating Oil Feb 2002 0.5321 0.0113 +2.17 HGU2 Copper Sep 2002 0.7250 0.0120 +1.67 SK2 Soybeans May 2002 457 3/4 7 1/2 +1.66 PLN2 Platinum Jul 2002 473 7.7 +1.65 LOSERS AGG2 Silver 1,000 oz. Feb 2002 4.250 -0.298 -6.55 NDM2 NASDAQ 100 Index Jun 2002 1570.50 -64.00 -3.92 PNH2 Propane Mar 2002 0.2720 -0.0105 -3.72 DJZ2 Dow Jones Industrial Avg. Dec 2002 9717 -249 -2.50 ZDH2 Dow Jones Industrial Avg. Mar 2002 9687 -240 -2.42 RLH2 Russell 2000 Index Mar 2002 475.25 -11.00 -2.26 SPM2 S&P 500 Jun 2002 1127.00 -24.70 -2.15 MVH2 Value Line Index. Mini Mar 2002 1214.50 -26.50 -2.14 MDH2 S&P Midcap 400 Mar 2002 495.00 -10.25 -2.03 KCH2 Coffee 'C' Mar 2002 49.25 -1.00 -1.99 FREE 2002 FUTURES & OPTIONS TRADING GUIDE Plus Bi-Weekly Hightower Report http://www.ino.com/specials/comek/tradeguide.html ____________________________________________________________________________ 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 SBLU SONICBLUE INCORPORATED 5.0200 1.1400 +29.53 IDCC INTERDIGITAL COMM CORP 11.9400 2.5000 +26.43 VII VICON INDUS 5.48 0.90 +20.04 STN STATION CASINOS INC 13.72 2.12 +18.28 FLAG FLAG FINANCIAL 8.9500 1.1400 +14.71 GRIF GRIFFIN LAND & NURSERIES 16.3500 2.0700 +14.65 MNC MONACO COACH 26.35 3.36 +14.62 MIEC MAGNA ENTERTAINMENT CORP CL A 8.0000 1.0100 +14.45 IFSIA INTERFACE INC'A' 6.2000 0.7600 +13.89 ROSS ROSS SYSTEMS INC 8.3000 0.8482 +11.31 LOSERS GMH GENERAL MOTORS CL H 15.55 -11.90 -70.41 GP GEORGIA-PACIFIC CORP 23.36 -9.00 -37.50 DYII DYNACQ INTL 17.2500 -7.2000 -29.63 FWC-A FOST WHEELER PFD CAP TR I 9% 5.26 -1.95 -28.06 KM-T K MART FINANCING I 7.75% PFD 9.86 -3.37 -25.30 TALX TALX CORP 19.8500 -4.5100 -18.78 PLT PLANTRONICS INC 22.20 -4.82 -17.84 ANR ANNUITY & LIFE RE (HOLDINGS) 19.51 -3.95 -16.79 HAND HANDSPRING INC 6.6000 -1.2000 -15.42 LTXX LTX CORP 19.2000 -3.5300 -15.41 _____________________________________________________________________ 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/ ). 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