March 2008 Archives

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today:

The Carlyle Group was forced to admit on Thursday that it had failed to save its troubled $22bn mortgage backed-securities fund less than eight months after floating the heavily leveraged vehicle on Euronext Amsterdam

Carlyle Capital Corporation, 15 per cent owned by employees of the Carlyle Group, said its banks were likely to take possession of its remaining assets and liquidate them after it ran out of cash to meet ever-rising margin calls – demands for more collateral – which exceeded $400m.

The implosion of CCC, which had $31 of debt for every $1 of its own, is a heavy blow to the reputation of Carlyle, one of the world’s biggest private equity groups. Many of the shareholders in CCC are also big investors in Carlyle’s buy-out funds.

CCC said in a statement: ”In total, through March 12, the company has defaulted on approximately $16.6bn of its indebtedness. The remaining indebtedness is expected soon to go into default.”

That's an impressive (and ridiculous) amount of leverage. And some think that this default is just the tip of the iceberg.

It'll be critical for the bulls to defend the Tuesday's Fed-induced gains today. I see the dollar's getting hit anew and gold is at $996 -- and I'm not at all interested in selling my GLD that I bought almost a year ago.

On Today's Calendar:

• 10:00 -- Business Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

We can chalk today up as just a consolidation day. Volume contracted today, which is just what you'd expect from a consolidation day. However, the failed intraday rally has to be a bit of a disappointment to the bulls. That rally didn't quite reach the March highs, so, on a daily basis, the market's still making lower-highs. So it seems to me that the line in the sand is now right around the March highs. The bulls need to break those highs so that yesterday isn't seen as just a one-day Fed induced buying panic.

The index charts are below. One common thing in these charts and those of the Dow and Russell 2000 is they all traversed their 10-day moving averages (at least) twice today -- closing below those averages for the 9th straight session.

no changes

This morning's flat open hints at a day of consolidation. That would certainly be healthy after yesterday's huge move. But I'd still like to see some follow-through sonner rather than later. The indices breaking their 10-day moving averages would be a good start.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

I'm back from vacation and judging by the volume last week I'm not the only one who was away. I haven't looked through all of my scans yet but the indices appear to be setting up for another push higher. All three of the major indices a I track are see-sawing around their 50-day moving averages. The fact that the didn't get crushed like the last couple of times the 50's were touched is a positive for the bulls. Some strength here, especially on strong volume, could create a nice short squeeze as the bears who have been leaning on the 50-day moving averages cover their positions.

Here are the index charts. I'll try to get some individual stock charts up by the open tomorrow...

The indices are real close to their 50-day moving averages and possibly flipping their intermediate-term trends.

I'm off to Spring Break (of sorts). Regular posting should resume on March 31st.

Don't forget that expiration is tomorrow since Friday is a market holiday. Look out for ye olde pinning games.

On Today's Calendar:

• 10:30 -- Crude Inventories

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Was today just another bull market rally or the beginning of a real bottom? That's the million dollar question. We've seen this type of day plenty of times over the last few months, especially after a Fed action, but they haven't had any follow-through. Despite the impressive gains today the indices haven't even risen above last week's highs yet. That could be changed pretty easily but in my eyes, the February highs are the ones that are really important. The key obstacle I see between here and those February highs are the declining 50-day moving averages. I suspect that the hardcore bears will look to reload around those 50-day moving averages.

Here are the S&P and Nasdaq charts. Normally I'd complain about the volume but given that trading is usually pretty reserved on Fed decision days until the 2:15 I think the volume level was pretty good.

Al the short-term trends are up now

Note: I have a doctor's appointment in the morning so there won't be a watchlist tomorrow. Look for post-Fed charts tomorrow evening.

Given how much angst there was over the Bear Stearns fallout I think the bulls have to be happy with how little damage was done to the indices today. The S&P managed to close above that important 1270 level. But, like I said yesterday, we're still left very close to that critical technical level with the reaction to the Fed decision likely to make or break that 1270 support.

Despite all the focus on financials today the Nasdaq, which isn't financial-laden, got hit worse than the S&P. A look under the covers of the Nasdaq-100 shows where the selling took place: FMCN (Chinese advertising) - 27%, APOL -10%, FWLT (Construction in the energy space) -10%, BIDU -8%, UAUA -8%, GENZ & VRTX (bio-wrecks) -5%, ADBE -5.6%, GOOG -4%...

The action in many commodities was toppy today as well. DBA, which is composed of Corn, Wheat, Soybeans and Sugar is working on a double top. It just needs to close beneath the March 10th low, which is 31 cents away, to confirm a double top. Note the bearish divergences in On-Balance Volume and stochastic:

And oil broke its 6-week uptrend today:

no changes

We're really starting to see the "economic unraveling" predicted in the book "Financial Armageddon" play out. This Bear Stearns debacle is based on two of the major themes in that book -- the abuse of derivatives and too much debt (leverage). If you haven't read the book I highly suggest you do. It's a surprisingly quick & easy read. If you want the CliffsNotes version, check out this podcast with the author, Michael Panzner.

A lot of people are asking how a company with an alleged book value of $80 could suddenly sell for $2. Clearly there's a ton of risk & losses (waiting to happen) that weren't being accounted for. So now the worry is which other financial institutions are in a similar state. Here's a list of some financial stocks getting hit this morning:

The financial sector is under heavy pressure in pre-mkt trading after the announced BSC fire sale: BSC -89.1%, LEH -34.5%, CFC -16.2%, WM -16.1%, MER -16.0%, CIT -15.6%, C -15.0%, ABK -14.0%, SCA -12.7%, NCC -12.5%, MBI -10.4%, UBS -10.4%, FNM -10.1%, WB -9.6%, IMB -9.4%, BCS -9.2%, MS -9.0%, GS -8.8%, PMI -8.6%, STT -8.4%, RBS -8.1%, FRE -7.9%, COF -7.9%, CS -6.0%, AIG -5.8%, BAC -5.4%, DB -5.4%, USB -5.0%, WFC -4.9%, BBT -4.2%, BMO -4.2%, MA -3.8%, RF -3.7%, AXP -3.7%, BK -3.5%, CM -3.2%.

On the positive side, a lot of traders, including myself, have been waiting for an open like this. Every time we got back to these levels (~S&P 1270) the Fed (PPT) would step in and save the day. We may finally get the big washout everybody's been waiting for.

On Today's Calendar:

• nothing

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Perhaps one good development from Friday's Bear Stearns induced selloff was that the VIX finally got back above 30. Real fear is starting to seep into the market.

And speaking of Bear Stearns (BSC), there's now talk of JPMorgan Chase (JPM) acquiring them for $20/share. Yes, a take-under! People who bought BSC on Friday who thought they were getting a bargain are going to be real upset if this comes to pass. There's a reason why the saying "don't catch a falling knife" exists.

Update: OK, scratch the $20 thing, the deal was done at $2 per share!!!!! Simply amazing.

JPMorgan Chase said Sunday it will acquire rival Bear Stearns in a deal valued at $236.2 million -- or $2 a share -- a stunning collapse for one of the world's largest and most venerable investment banks.

The last-minute buyout was aimed at averting a Bear Stearns bankruptcy and a spreading crisis of confidence in the global financial system.

The Federal Reserve and the U.S. government swiftly approved the all-stock deal, showing the urgency of completing the deal before world markets opened.

Here's the Broker / Dealer index, which held up pretty well considering how bad BSC weighed on it on Friday:

I had Goldman Sachs on my screen on Friday and was struck at how chaotic & choppy the trading in GS had been over the last week or so. One could either make a killing or get chopped to bits with this kind of action:

Finally, here are the index charts. It's uncanny how often the indices come to rest at an important technical level ahead of a Fed meeting. This time is no different. How the market reacts to the Fed decision on Tuesday could push us to new lows:

no changes

Yesterday, after the intraday S&P subprime commentary that sparked the huge reversal I was thinking that this market is as treacherous as I've ever seen. I'm glad it's not just me who's thinking that. Here's what Art Cashin said this morning:

This has got to be the most skittish and suicidal bunch of shorts that I've seen in 45 years.

He said that because of the rallies they've been forced to spark caused by Fed actions, AMBAC rumors and S&P yesterday. He also credited the fact that short interest is at all time highs thanks to tons of hedge funds and that most of their traders are 'just out of diapers' and have never traded a bear market before. :-)

Anyway, we had a big reversal in the futures this morning thanks to the tamer than expected CPI. This is a great opportunity for the bulls to make some higher-highs on the daily charts.

On Today's Calendar:

• 10:00 -- Mich Sentiment-Prel.

More Calendars: U.S. Earnings | Conf. Calls | Surprises | IPO | Economic

Potential swing trades:

Despite the Fed's best efforts another fund bites the dust today: