Henry Ford's MarketWatch LIVE!

4:04 PM
UPDATEEnding close to index lows for the day, but still contained within decending channels.All cyclical indicators are way oversold again, but we need a solid break of the decending tops trendline before we can project the next move. Sill closed above the 62% Fibonacci retracement levels. NDX is underwater and approaching its declining bottoms trend line which should offer some long term support. Shorts were in control today, but volume was fairly light.
:: Henry Ford ::

3:32 PM
UPDATEHere's the 3:30 update for the SP...DOW looks the same

:: Henry Ford ::

2:54 PM
UPDATE COMS is looking interesting here...Came down to 50% level and bounced off of lower rising trendline...stops would be below today's low

:: Henry Ford ::

2:43 PM
UPDATELooks like this pattern is shaping up to be what is called a "MEASURED MOVE" ...Once the indices turn we will pretty well be able to pinpoint the ultimate target for this rally move. There is always the possibility of a double bottom, but I see this as unlikely at this point...I think we are pretty close. Hourly charts are looking like they are ready to cycle up.
:: Henry Ford ::

2:37 PM
UPDATEContinuing drift lower. but still wrapping around either side of declining tops trendlines on SP500 and DOW....
:: Henry Ford ::

1:52 PM
UPDATESome how lost the original chart I threw up of the SP500...I'll post a new one...it looks the same...

:: Henry Ford ::

1:32 PM
UPDATEStill nothing going on here....another half hour or so before the traders return from lunch...SP still bouncing above 50% Fib...DOW back up to 50% level right now....go back to sleep.
:: Henry Ford ::

12:47 PM
CIRCUIT BREAKERS & CURBS
RESTRICTION----------------------------------TRIGGERED BY
NYSE collar (Rule 80A) -------------------DJIA moves 180 points
CME restriction 1--------------------------S&P500 futures contract moves 2.5%
CME restriction 2--------------------------S&P500 futures contract moves 5%
CME restriction 3--------------------------S&P500 futures contract moves 10%

NYSE circuit breaker nr. 1-------------DJIA moves 10%
NYSE circuit breaker nr. 2-------------DJIA moves 20%
NYSE Circuit breaker nr. 3-------------DJIA moves 30%

NYSE Collar (Rule 80A): Restrictions on program trading
This restriction is triggered if the Dow Jones Industrial Average (DJIA) moves up or down by 180 points (for 2Q02). If this trigger occurs, program trading curbs are put in effect. Essentially a key computer is turned off, so program trading must be done "by hand." This rule is also known as the "uptick downtick rule" (more formally: index arbitrage tick test) because it restricts sells to upticks and buys to downticks. In other words, when the market is down (last tick was down), sell orders can't be executed at lower prices. In an up market (last tick was up), buy orders can't be executed for higher prices. This collar is removed when the DJIA retraces its gain or loss to within 100 points of the previous close.

CME Restrictions
Trading in the S&P500 futures contract is halted just for a few minutes if the prices moves 2.5%, 5%, or 10% from the previous close. Because restrictions on the NYSE effectively shut down trading in this futures contract, there is little need for additional restrictions on the CME.

NYSE Circuit Breakers
These restrictions are also known as "Rule 80B." The first version of this rule, adopted in 1988, set triggers at 250 DJIA points and 400 DJIA points. These restrictions are updated quarterly to reflect the heights to which the Dow Jones Industrial Average has climbed.

10% decline (1050 points for 1Q01)
The first circuit breaker is triggered if the DJIA declines by approximately 10%. The restrictions that are put into place -- if any -- depend on the time of day when the circuit breaker is triggered. If the trigger occurs before 2pm Eastern time, trading is halted for 1 hour. If the trigger occurs between 2 and 2:30pm Eastern, trading is halted for 30 minutes. If the trigger occurs after 2:30pm Eastern time, no restrictions are put into place. (This restriction was first used during the afternoon of 27 Oct 97.) If the Dow Jones rallies 10%, there is no restriction, because program buying and the accompany rally is always perceived as "good."

20% decline (2150 DJIA points for 1Q01)
The second circuit breaker is triggered if the DJIA declines by approximately 20%. The restrictions that are put into place again depend on the time of day when the circuit breaker is triggered. If the trigger occurs before 1pm Eastern time, trading is halted for 2 hours. If the trigger occurs between 1 and 2pm Eastern, trading is halted for 1 hour. If the trigger occurs after 2pm Eastern time, the NYSE ends trading for the day. There is no trading halt if it rallies 20%, as that would be perceived as "very very good."

30% decline (3200 DJIA points for 1Q01)
The third circuit breaker is triggered if the DJIA declines by approximately 30%. The restriction is very simple: the NYSE closes early that day. There is no trading halt if it rallies 30%, as that would be perceived as "the best thing that ever happened in the history of the world."
The circuit breakers cut off the automated program trading initiated by the big brokerage houses. The big boys have their computers directly connected to the trading floor on the stock exchanges, and hence can program their computers to place direct huge buy/sell orders that are executed in a blink. This automated connection allows them to short-cut the individual investors who must go thru the brokers and the specialists on the stock exchange.
:: Henry Ford ::

12:44 PM
UPDATECurbs are in and DOW has now dropped below 50% on it's way to the 62% line...No patterns evolving here yet, except we are staying with the downward sloping channel.For the time being anyway, the SP Futures are holding 50%. I'll post curb rules here shortly.
:: Henry Ford ::

12:36 PM
UPDATEwe have now touched off of the 50% support line for SP and DOW
:: Henry Ford ::

11:58 AM
UPDATEWe are heading into lunchtime, so I don't expect much. Floor traders will try to move things around a little to do some scalping, but it will probably be pretty quiet till 2-2:30PM...(it is usually when I say things like that that they blow up).
:: Henry Ford ::

11:51 AM
UPDATEHere is where we are at 11:50...Just drifting in the downward sloping channel looking for traction at the 50% Fibonacci. Actually...I have the Fibs reversed if reading from the top. Should be 38/50/62...just turn the chart over...

:: Henry Ford ::

11:14 AM
UPDATE 50% level for the DOW is the 8150 area...SP500 is 842
:: Henry Ford ::

11:00 AM
UPDATE It appears we are either going to see traders run the lower stops or trace back ton the 50% Fibonacci level...
:: Henry Ford ::

10:04 AM
UPDATE So far support lines holding...nothing to do here till we see some direction. That will take a break below 8200 or thrust above 8300...meanwhile we remain range bound.
:: Henry Ford ::

10:02 AM
UPDATE ISM came out at 53.1, above 50 which is critical to advancing economy.
:: Henry Ford ::

9:30 AM
FRIDAY'S CLOSE
We ended with SP500 price above the declining tops trendline and bouncing out of the 38% Fibonacci retracement. Fibonacci's are natural support and resistance areas where supply and demand come into momentary balance. We would like to see the 38% line hold this morning and become the basis for a new rally, but it is perfectly reasonable for price to go down to the 50% level, so we are prepared for that. That's why I said we are keeping a short leash on any accumulations and will add hedges on any substantive break.

:: Henry Ford ::

9:13 AM
GOOD MORNING! As we start the day we have the DOW and SP resting above the support line from Friday's close....I will put up Fridays closing chart in a few. We do have an important report due out at 10 am with the ISM services (used to be NAPM services). [BRIEFING.COM] S&P futures vs fair value: -4.3. Nasdaq futures vs fair value: -6.0. Negative bias intact but the pre-market tone has improved slightly in recent trade. Providing a boost for the tech sector is AMD in the wake of a favorable Barron's story. Banks will be of interest following the cautious comments on C and JPM by Lehman. Increased tension between Taiwan and China could have an adverse impact on TSM and UMC.

:: Henry Ford ::

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