08.12.04 - Saved by Dell?

Heavy Tech Selling A quick update tonight; Thursday saw another day of heavy selling across the board. The NDU4 broke to its lowest level since late 09.03, trading through the 08.11.04 lows, while both the DJU4 and SPU4 held their 08.11.04 lows intraday though they were essentially tagged on a closing dump. After-the-bell, Dell was set to announce quarterly earnings. Will the market be "saved by the Dell" on Friday the 13th? With the Smith Barney upgrade this afternoon, one has to wonder if they have some postiions to unload.

The range continues for the DJU4 at 9800-9850 and 9950-10000. The NDU4 has a gap 40+ pts higher. With both sides of the 9800-10000 range tested now its time for one of the camps to take control. A possible scenario is for both the DJU4 and SPU4 to/through their 08.06.04 and 08.12.04 lows, 9776 and 1060 respectively and reverse, a pattern that would get some systems long. Friday the 13th will tell the tale. The DJU4 needs a close above 9935 to stabilize the market; a close below 9775-9800 and the bears continue to control the market.

Continue to watch the US notes and bonds for signals of a reversal in equities. A close below 111'04 and 108'28 basis TYU4 and USU4 would be a positive development for equities and a reversal in the interest rate instruments. Such a move would target 109'08-109'24 and 106'08-107'00 respectively. The upside reaction Thursday was muted considering the amount of selling in the indices. A close in the US dollar index above 8935 would confirm the move.