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T U 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/ ) Tuesday: The CRB Index has eased 0.98 points to 189.09. The US Dollar Index gained 0.05 points to 117.71. The Dow Industrials slipped 58.05 points, at 9713.80, while the S&P 500 dropped 8.27 points, last seen at 1119.31. The Nasdaq Composite retreated 47.80 points to 1882.54. _____________________________________________________________________ FREE 2002 Commodity Reference Calendar & Free Online Trading Software CD Rom http://www.ino.com/specials/linngroup/calendar.html _____________________________________________________________________ NEW *** Live@TAG *** Live@TAG *** Live@TAG *** NEW - Trading Workshops Online Anytime Create Your Own Personal Trading Conference! http://live.ino.com - <a href="http://live.ino.com"<Live@TAG</a< _____________________________________________________________________ *** The Very Latest from Larry Williams *** FREE 12 PAGE BROCHURE AVAILABLE NOW AT: http://store.ino.com/sale/1A433/INLST-ShortTerm _____________________________________________________________________ SPECIAL ANNOUNCEMENT: The 20th Century's World Champion Trader Finally Reveals His Amazing Secrets In 2001! Introducing The Seminar That Has Changed Trading Forever . . . 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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 Tuesday due to suspicions about earning prospects in technology stocks during the first quarter of this year dim. The NASDAQ closed sharply lower on Tuesday breaking out below December's reaction low crossing at 1918.50, which coincides with the 25% retracement level of the rally off last September's low. The door is open for additional weakness with the 38% retracement level crossing at 1826.96 being the next likely downside target later this winter. The NASDAQ closed down 47.81 points at 1882.53. The March S&P 500 index also closed lower on Tuesday as it posted a key reversal down and finished the day below the 25% retracement level of the rally off September's low crossing at 1122.57. Multiple closes below this support level and December's low at 1115 would open the door for a larger-degree decline during the last half of January. The March S&P 500 closed down 6.90 points at 1121.70. The Dow closed lower on Tuesday and is challenging key fib support crossing at 9706.20. The Dow closed down for the eleventh time in the past thirteen trading sessions as earnings forecasts seen do not justify the gains we saw in the fourth quarter of last year. The Dow is at an important crossroads. Closes below 9706.20 would open the door for a larger-degree decline into late winter. At the same time, short-term momentum indicators are bearish but becoming oversold hinting that at the very least we could see a short covering bounce possibly into the end of January. Today's low-range close sets the stage for a steady to weaker opening on Wednesday. INTEREST RATES http://quotes.ino.com/exchanges/?c=interest March T-bonds posted an inside day with a lower close on Tuesday thereby leaving last Friday's upside reversal unconfirmed. Last week's breakout below January's uptrend line has increased the odds that a short-term top has been posted. Closes below last Friday's low crossing at 102-17 are needed to confirm the trendline breakout is for real. Momentum indicators are overbought and turning neutral to bearish hinting that we could see sideways to lower prices near-term. The CRB INDEX http://quotes.ino.com/exchanges/?c=indexes The CRB index closed lower for the third day in a row on Tuesday due to weakness in grains, precious metals, some foods and fiber. Last week's breakout below the fall uptrend line crossing near 191.15 has opened the door for sideways to lower prices into the latter part of January. If the decline continues, December's reaction low crossing at 187.73 is the CRB's next likely target. Momentum indicators are bearish signaling that sideways to lower prices are possible into the end of January. ENERGY MARKETS http://quotes.ino.com/exchanges/?c=energy The energy markets closed higher on Tuesday due to short covering ahead of the release of this afternoon's API inventory reports. Gains were limited due to expectations for builds in crude oil and product inventories last week. March crude oil closed higher on Tuesday as it rebounded off December's reaction low crossing at 18.45. Today's anemic bounce under scores the weak tone of the market, which remains vulnerable to additional weakness into the later part of January if this week's API inventory report comes in neutral to bearish. Stochastics and the RSI are bearish signaling that additional weakness is possible near-term. March heating oil closed slightly higher on Tuesday but ended the day near mid-range as it consolidates above trading range support crossing at 51.30. Closes below this key support level would confirm a trading range breakout while opening the door for a possible test of weekly support crossing at 49.30 later this winter. Mild temps across high demand regions of the country and weak industrial demand continues to weigh on prices. Momentum indicators are bearish but oversold while trend-following indicators are in position to confirm a trading range breakout. March unleaded gas closed modestly higher on Tuesday due to light short covering as it rebounded off last fall's uptrend line crossing near 55.05. Closes below this support level would open the door for a likely test of last fall's lows beginning at 53.00 and extending down to 51.90. Stochastics and the RSI are bearish signaling that additional weakness is possible into the last half of January. Closes above 58.70 would temper the near-term bearish outlook in the market. March Henry Hub natural gas closed into new contract lows on Tuesday as above normal temps across high-demand regions of the U.S. and limited industrial demand continue to weigh on prices. Today's breakout into new contract lows has renewed the larger-degree downtrend. If the decline continues, weekly support crossing at 1.76 is March's next downside target later this winter. CURRENCIES http://quotes.ino.com/exchanges/?c=currencies The March Dollar closed higher on Tuesday thereby negating last Friday's key reversal down. However, today's low-range close leaves the market vulnerable to a softer opening on Wednesday. Nevertheless, stochastics and the RSI remain bullish signaling that a test of December's high crossing at 118.85 is possible later this month. The March Swiss Franc posted a quiet inside day with a slightly lower close on Tuesday as March continues to consolidate above last fall's trading range support crossing at .5973. Multiple closes below this support level or above neckline resistance crossing near .6067 are needed to clear up near-term direction in the market. Stochastics and the RSI remain bearish signaling that sideways to lower prices are still possible into the end of January. The March Canadian Dollar closed higher on Tuesday due to light short covering as they consolidate some of last week's losses. However, momentum indicators are turning neutral to bearish hinting that additional weakness is possible into the end of January. It would take closes above broken support crossing at .6230 to temper the near-term bearish outlook in the market. The March Japanese Yen broke out below key weekly support crossing at .7558 on Tuesday thereby renewing the larger- degree downtrend. A short covering bounce late in the session tempered some of today's loss leaving the door open for additional short covering on Wednesday. Nevertheless, today's breakout into a new contract low has opened the door for a possible test of the next level of weekly support crossing at .7371. Momentum indicators are turning bearish with today's sell off signaling that additional weakness is likely into the end of January. PRECIOUS METALS http://quotes.ino.com/exchanges/?c=metals February gold closed lower on Tuesday as it tested December's uptrend line crossing near 282. Closes below this support level would confirm a top and trend change has taken place. I would not be surprised to see a short-covering bounce on Wednesday as February might try to consolidate some of its losses of the past three trading sessions before attempting to move lower into the end of January. Momentum indicators are bearish signaling that sideways to lower prices are possible near-term. March silver closed sharply lower on Monday and below the 62% retracement level of November's rally crossing at 4.327. If the decline continues, fib support crossing at 4.221 is March's next targets. Momentum indicators are bearish signaling that sideways to lower prices are possible during the last half of January. A short covering rebound late in the day tempered some of today's loss leaving the door open for additional short covering on Wednesday that could lead to a test of broken support crossing at 4.327. March copper closed higher due to technical short covering late in the day. Early weakness spiked below minor support crossing at 69.50. March copper remains locked in a downtrending channel that began earlier this month. Closes above 72.40 or below 69.50 are needed to breakout of this channel and clear up near-term direction in the market. Momentum indicators are turning neutral to bearish warning traders to use caution as downside risk is increasing in the market. GRAINS http://quotes.ino.com/exchanges/?c=grains March corn gapped down and closed lower on Monday amidst a lack of fresh market supporting news. Today's export inspection report came in at 31.374 million bushels, up 1% from last week but 9% below year ago levels. Year to day shipments are running behind year ago levels by 8.5%, which the main reason that corn prices have been unable to sustain much strength this winter. Today's close below minor support crossing at 2.10 1/4 is short-term bearish as the door is open for another test of January's low at 2.07 3/4 later this month. Short-term momentum indicators have turned neutral to bearish with today's sell off signaling that sideways to lower prices are possible into the end of January. March wheat gapped down and closed lower on Monday triggered by expectations that Argentina's wheat exports will begin to pickup soon. Losses were exaggerated as sell stops were triggered below last week's low. The breakout below initial trendline support last week has set the stage for a test of December's uptrend line crossing near 2.92 later this week. Closes below December's uptrend line would open the door for a possible retest of December's low crossing at 2.77 later this winter. Weak export demand continues to the driving factor behind the sell off, which began last week. Stochastics and the RSI are bearish signaling that sideways to lower prices are likely into the end of January. SOYBEAN COMPLEX http://quotes.ino.com/exchanges/?c=grains March soybeans broke out below January's uptrend line on Tuesday thereby confirming that last week's high marked a short-term top. Improving chances for precip across portions of southern Brazil later this week triggered aggressive selling by locals. Additional pressure came from weakness in soybean meal. Today's low fell just short of filling the January 10th gap at 4.37, March's next target. I am looking for this support level to be tested on Wednesday but would not be surprised to see a higher close tomorrow due to technically related short covering. Longer-term, I am looking for sideways to lower prices into the later part of January as most momentum indicators turned bearish with today's sell off signaling that sideways to lower prices are possible near-term. March soybean meal closed sharply lower on Tuesday due to increased chances for rain across portions of South America later this week. Today's low fell short of filling the gap crossing at 154.80. I am looking for this support level to be tested on Tuesday but would not be surprised to see a higher close tomorrow due to light technical short covering. Short-term momentum indicators have turned bearish signaling that a sell off into the later part of January is possible. Closes below initial gap support crossing at 154.80 would open the door for a larger-degree decline and possible test of the January 10th gap crossing at 147.90 later this month. LIVESTOCK http://quotes.ino.com/exchanges/?c=livestock April hogs posted a huge key reversal down on Tuesday and closed below the December-January uptrend line crossing near 60.80 thereby confirming that a short-term top has likely been posted. Today's sell off was triggered by profit taking amidst ideas that cash bids could fade this week as packer margins are beginning to shrink. I would not be surprised to see a short covering bounce on Tuesday on ideas that today's sell off was overdone. However, it is unlikely that April futures will exceed today's high ahead of Friday's monthly hogs and pigs report. Today's sell off turned a number of momentum indicators bearish thereby increasing the odds that we could see sideways to lower prices near-term as futures and cash bids try to realign themselves. If the setback off today's high continues, last fall's uptrend line crossing near 57.50 is a potential target later this month. April cattle also posted a key reversal down on Tuesday. The market gapped higher on the open following last Friday's friendly monthly cattle on feed report. However, old concerns regarding seasonal beef demand and futures stiff premium over cash bids returned soon after April failed to extend its opening gains. Spillover pressure from the sell off in the hog pit also weighed on prices. Today's high marks a potential double top with last week's high however, closes below trading range support crossing at 72.90 are needed before this can be confirmed. Additional weakness on Tuesday is needed to confirm today's bearish reversal pattern however, closes below last fall's uptrend line crossing near 73.00 are needed to confirm that a short-term top has been posted. Momentum indicators are bearish signaling that sideways to lower prices are possible near- term. FOOD & FIBER http://quotes.ino.com/exchanges/?c=food March coffee gapped down and closed lower on Tuesday as fund selling continues amidst near ideal weather in Brazil's coffee region. Expectations for more aggressive selling by Mexico, Central America and Vietnam are also weighing on prices. Momentum indicators are bearish signaling that sideways to lower prices are likely into the end of January. This sets the stage for a possible test of this winter's low crossing at 44.75 later this month. March cocoa closed higher on Tuesday and filled last Friday's gap at 1311 but fell short of testing last week's high at 1344. At the same time, March remains below broken trendline support and gap resistance crossing at 1355. Closes above 1355 or below 1260 are needed to clear up near- term direction in the market. Momentum indicators are bearish signaling that additional weakness is possible near- term. March sugar posted an upside reversal on Tuesday due to technical short covering after testing last fall's uptrend line crossing near 721. I would not be surprised to see follow-through short covering on Wednesday following today's high-range close. Closes below last fall's uptrend line would confirm a top and trend change has taken place. Momentum indicators remain bearish signaling that sideways to lower prices are still possible during the last half of January. March cotton closed lower on Tuesday thereby confirming last Friday's key reversal down. Today's close below January's uptrend line opens the door for additional weakness into the end of the month. However, I would not rule out a short covering bounce on Wednesday as March might try to consolidate some of its losses of the past two weeks before heading lower later this week. Stochastics and the RSI are turning bearish with today's sell off thereby increasing the odds that March cotton will trend sideways to lower into the end of the month. Downside risk appears limited to trading range support crossing at 34.91. 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 _____________________________________________________________________ Pacific Exchange To Trade Options on Principal Financial Group, Inc. http://news.ino.com/press/?release=27727 NASD Dispute Resolution Has Record Year http://news.ino.com/press/?release=27726 Amex Increases Position Limits For QQQ Options http://news.ino.com/press/?release=27725 ____________________________________________________________________________ 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 HUF3 New York Harbor Unleaded Gasoline Jan 20 0.5710 0.0446 +7.85 CLK3 Light Sweet Crude Oil May 2003 20.38 1.10 +5.47 LBH2 Random Length Lumber Mar 2002 272.70 10.00 +3.81 CCZ2 Cocoa Dec 2002 1230 45 +3.80 SIZ3 Silver Dec 2003 4.360 0.114 +2.60 SBH2 Sugar #11 World Mar 2002 7.43 0.14 +1.92 HOK3 Heating Oil May 2003 0.5556 0.0099 +1.80 OK2 Oats May 2002 177 1/2 2 1/2 +1.43 XOK2 Oats May 2002 177 1/2 2 1/2 +1.43 EJH2 Euro/Japanese Yen Mar 2002 118.04 1.58 +1.36 LOSERS AGF2 Silver 1,000 oz. Jan 2002 4.030 -0.308 -7.10 NGG2 Henry Hub Natural Gas Feb 2002 2.106 -0.111 -4.96 PAH2 Palladium Mar 2002 398.00 -16.85 -4.06 DBK2 Butter May 2002 139.000 -5.000 -3.47 YIN2 Mini NY Silver Jul 2002 4.320 -0.150 -3.36 NDM2 NASDAQ 100 Index Jun 2002 1562.00 -50.00 -3.20 XHJ2 Lean Hogs Apr 2002 59.70 -1.72 -2.80 QLG2 Central Appalachian Coal Feb 2002 28.00 -0.75 -2.68 LHJ2 Lean Hogs Apr 2002 59.700 -1.625 -2.65 SMV2 Soybean Meal Oct 2002 148.5 -3.2 -2.11 FREE: Vantagepoint Market Software Reports Predict The Markets With Up To 80% Accuracy http://www.ino.com/specials/mkttech/vantagepoint.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 BFR BBVA BANCO FRANCES SA 5.21 1.97 +55.49 AMZN AMAZON.COM 12.6000 2.4400 +24.02 CACH CACHE, INC 6.6500 1.2200 +23.02 AGIL AGILE SOFTWARE CORP 15.2710 2.2900 +17.27 WLL WILLAMETTE INDUSTRIES INC 55.12 8.01 +17.01 NMSS NMS COMMUNICATIONS CORPORATION 5.1600 0.7500 +16.67 RH ROTTLUND CO 8.91 1.16 +14.97 ENMD ENTREMED INC 7.8300 1.0000 +14.71 PC PEREZ COMPANC S.A. 10.15 1.26 +14.21 GEG GLOBAL POWER EQUIP GRP 10.95 1.25 +12.82 LOSERS CYBX CYBERONICS INC 12.8300 -16.4700 -56.37 KM-T K MART FINANCING I 7.75% PFD 5.27 -4.61 -46.66 OSUR ORASURE TECHNOLOGIES INC 7.0000 -3.3600 -32.46 EOT EOTT ENERGY PARTNERS L.P. 10.19 -4.86 -32.29 RHB REHABCARE GROUP 20.25 -5.06 -20.07 PCIS PRECIS INC 10.1500 -2.4500 -19.07 GY GENCORP 11.50 -2.72 -19.03 NWRE NEOWARE SYSTEMS 5.5400 -1.2100 -17.79 BYBI BACK YARD BURGERS 6.7500 -1.3975 -17.47 DUSA DUSA PHARMACEUTICALS 5.6000 -1.1500 -16.43 _____________________________________________________________________ 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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