Monday, November 1, 2004
Issue Contents:
| 09:05 | The Day Ahead Economic releases and news. |
| 09:27 | Swing Trade Setups Featured charts for Monday November 1 |
| 11:30 | Crude Reality The linkage continues. |
| 16:15 | TrendVue Trader Talk Today's transcript. |
Good morning, on this the 306th day of 2004, first day of November, and a likely dull trading day immediately ahead of tomorrow’s US presidential election. Our international clients should note that North America moved its clocks back one hour on the weekend, so what was once 9 am Eastern Time is now 8 am Eastern Time.
Crude is currently trading up 1.16% (November contract) at 52.36 on fears of a strike in Nigeria. At 10:00 am the most watched items of the day will be the opening of Crude trading on Nymex, and the ISM Manufacturing Index for October – considered a timely and detailed peek into the condition of the factory production sector.
US Market Calendar
- 8:30 am: Personal Income and Outlays1
- 10:00 am: Construction Spending
- 10:00 am: ISM Mfg Index
Canadian Market Calendar
- No scheduled releases.
Earnings and the Federal Reserve
For earnings highlights, please see today's WSJ Earnings Calendar.
For a list of upcoming speeches, congressional testimony, Federal Open Market Committee material, and statistical releases, please visit the What's Next page of The Federal Reserve Board website. Recently released Federal Reserve Board material, including market moving FOMC decisions and speeches by members, will be found on their What's New page.
1 BEA News Release: Personal Income and Outlays Personal income increased $15.1 billion, or 0.2 percent, and disposable personal income
(DPI) increased 49.8 billion, or 0.6 percent. In August, personal income increased 20.0 billion, or 0.2 percent, and PCE decreased $6.4 billion, or 0.1 percent, based on revised estimates.
Featured setups from Friday October 29 closing data symbol scan
Jump to: Long Setups | Short Setups | Special Situations
Notes for the Day
One word for me: caution and restraint. Its difficult to imagine that much will happen today, one day before the election. Gold is up a little – those names may continue what they started last week.
Long Setups
General common strategy: Unless noted otherwise, buy stop just above the “high” value, with an initial protective stop at the low value of the bar, not below the bar.
Test of Bottom – Reversal
F has been a decent short lately but whenever a stock has the potential to reverse and follow through from a test of bottom we want to give it the benefit of doubt (or stay out of shorts until the picture clears). There’s a building bull flag potentially setting up, which would create a failed bear flag from earlier last week. For one or two bars at most we can follow price down with a buy stop above down bars. Buy stop 13.20, protective stop if filled 12.92.
Retracement or Pause in Up Swing / Up Trend
DDS buy stop 20.84 – demand it push above Thursday’s high and hold.
PXLW – starting to see this pattern in a number of charts – a break out from a triangle congestion pattern and then a bar or two pause. Buy stop above the down bar – 11.46.
SIMG buy stop 13.81
WMT buy stop 54.32
Test of Top – Continuation
PDG
NEM – using two day high as alert/stop.
Short Setups
General common strategy: Unless noted otherwise, place a sell alert at or just below the low of the setup bar, and look for the first failed intraday bounce after the low has been broken. What we are looking for is price to push down, bounce a little, and fail again – this is where we want to get short.
Retracement or Pause in Down Swing / Down Trend
SBC. Make sure it clears the two day low before considering holding. Aggressive traders only.
VZ must be a sector trend… so both should work, or not…
Special Situations
PFE possible high ADX reversal – this is the first pause after the bounce. Buy stop 28.96. Note that news out on MRK today may pull the entire sector down.
This is quite a remarkable chart:
Crude (candles) vs ES (blue) and NQ (green)
Commentators are all abuzz over the sudden drop in oil; what would be more interesting would be a discontinuation of the still-strong linkage between crude and the stock market.
Lately I’ve been using the CL contract to help time (or avoid) stock index futures trades. Never before this year have I felt the need to monitor both. Now, CL is my constant, if unwanted, companion.
Today's transcript.
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