Trader, Friday S&P +3.89 NAS +10.84 CRB -0.16 DOW +5.68 USD -0.32 F R I D A Y   E V E N I N G   E X T R E M E   M A R K E T S A complimentary service from INO.com ( http://www.ino.com/ ) Friday: The CRB Index has slid 0.16 points to 191.91. The  US Dollar Index edged lower 0.32 points to 117.25. The Dow Industrials edged higher by 5.68 points, at 10136.99, while  the S&P 500 trended higher 3.89 points, last seen at 1161.02. The  Nasdaq Composite moved higher by 10.84 points to 1987.26. _____________________________________________________________________ TWO FREE VIDEOS ON OPTIONS TRADING!  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All Products Guaranteed. _____________________________________________________________________ E X T R E M E   M A R K E T   C O M M E N T A R Y _____________________________________________________________________ The STOCK INDEXES http://quotes.ino.com/exchanges/?c=indexes Stock indexes were mixed on Friday following today's bullish economic data. Tech stocks remain strong lead by gains in Yahoo, which rose 75-cents to $18.52 on a fourth-quarter revenue update by Merrill Lynch analyst Henry Blodget. Today's rise on the consumer confidence index also supported today's rallies in the stock indexes. The NASDAQ closed higher on Friday but near session lows due to a sell off ahead of the close. Closes above the reaction high crossing at 2010.91 would open the door for a possible test of December's high early next year. The March S&P 500 index closed slightly lower on Friday due to a late-session sell off triggered by year-end tax selling.  The Dow closed slightly higher on Friday as today's positive economic news was off set by year-end selling by investors for tax purposes. The marked jump in the consumer confidence index, which came in at 93.7 versus expectations of 83 and above November's 84.9 raised hopes that a recovery in business may be possible beginning in the first quarter of 2002. The Dow continues to consolidate above the 62% retracement level of the May/September decline crossing at 10,094.10. At the same time, a number of short-term momentum indicators are becoming overbought hinting that we could see a brief setback to start the new year.  INTEREST RATES http://quotes.ino.com/exchanges/?c=interest March T-bonds closed lower on Friday as the latest economic data shows a rise in home sales along with increased orders for many big-ticket items. Additional support came from a rebound in consumer confidence raising hopes that better days may be ahead for the ailing economy as we move into 2002. The latest consumer confidence index rose to 93.7 up from a revised 84.9 in November. Analysts were expecting a figure close to 83. Technically, March bonds appear to be forming an inverted head and shoulder's bottom. Closes above 102-05 are needed before this bottom formation can be confirmed. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible into early- January.  The CRB INDEX http://quotes.ino.com/exchanges/?c=indexes The CRB index posted an inside day with a lower close on Friday. Thursday's key reversal down remains unconfirmed, as the CRB did not take out yesterday's low. However, momentum indicators are diverging warning that a double top might have been posted with yesterday's high. The CRB index will need to close above this year's downtrend line crossing near 195.35 to confirm a major trend change is taking place.  ENERGY MARKETS http://quotes.ino.com/exchanges/?c=energy The energy markets closed lower on Friday with the exception of natural gas. Early strength was due to OPEC's announced product cuts for January 1, 2002. However, profit taking by mid-session in a "buy-the-rumor-sell-the-fact" move on the part of traders led to a sell off into the close. OPEC confirmed that it will cut production by 1.5 million barrels per day beginning January 1 and those cuts will remain in place for 6-months. Crude oil prices have already risen $3.11 from their November lows as the markets have already priced in some of today's bullish news.  February crude oil closed lower on Friday due to light profit taking before the end of the year. Today's low-range close leaves the door open for follow-through selling when trading resumes next week. If traders return from the holidays in a buying mood, February crude oil may try and test November's high at 22.83 in early-January. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term.  February heating oil closed lower on Friday and below broken resistance crossing at 57.80. February's inability to rally on confirmation of bullish news strongly suggests that most of if not all of today's bullish news has already been factored into prices. If February extends this month's rally next week, November's reaction high crossing at 64.35 is a possible target later this winter.  February unleaded gas posted key reversal down on Friday as early strength fell short of testing November's high at 62.31. Year-end profit taking ahead of the close pulled February into negative territory. Additional weakness next week is needed to confirm today's bearish reversal pattern thereby increasing the odds that a short-term top might have been posted. February Henry Hub natural gas posted an inside day with a higher close due to light short covering as it consolidated some of Thursday's losses. Today's rebound was triggered by extended forecast, which are calling for below-normal temps to spread across the upper part of the U.S. during the first week of January. Closes above 3.034 or below 2.555 are needed to confirm a breakout of December's trading range. CURRENCIES http://quotes.ino.com/exchanges/?c=currencies The March Dollar posted an inside day with a lower close on Friday as it continues to consolidate some of Monday's gains. Today's close below November's high at 118.27 and the 62% retracement level of this summer's decline crossing at 118.23 should be noted by bullish traders. Multiple closes below these broken resistance levels would temper the near- term bullish outlook in the Dollar. If the rally resumes, the 75% retracement level of this summer's decline crossing at 119.57 is March's next upside target.  The March Swiss Franc closed slightly higher on Friday as it consolidates below broken support crossing at .5973. Closes above this broken support level would temper the near-term bearish outlook in the Franc. Closes below this week's low at .5797 would renew December's decline and could lead to a test of fib support crossing at .5722 later this winter.  The March Canadian Dollar closed higher on Friday due to year-end short covering following this week's test of November's low at .6230. Today's rally also confirmed Thursday's key reversal up thereby increasing the odds that additional short covering is possible into early-January. Additional strength will be needed before momentum indicators turn bullish.  The March Japanese Yen closed higher on Friday due to year- end short covering. However, the mid-range close leaves the door open for sideways to lower trading when the yen reopens next week. I am still looking for March to test monthly fib support crossing at .7568 in the near future. The daily ADX is bearish signaling that additional weakness is possible into early-January. PRECIOUS METALS http://quotes.ino.com/exchanges/?c=metals February gold closed lower on Friday confirming Thursday's breakout out below December's uptrend line. Today's close below December's uptrend line opens the door for sideways to lower prices into early-January. Stochastics and the RSI are turning bearish signaling that additional weakness into the first half of January is possible. I would not be surprised to see a trading range develop after the first of the year, which could last well into February.  March silver posted an upside reversal on Friday but remained below the 62% retracement level of this fall's decline crossing at 4.51. Stochastics and the RSI are very overbought and turning bearish warning traders to use caution as a top might be in or near. Closes below December's uptrend line crossing near 4.39 are needed before this is confirmed. The daily ADX turned down with Thursday's decline hinting that the rally off November's low is in trouble.  March copper closed lower on Friday and is poised to test the 50% retracement level of November's rally crossing at 67.50. Closes below this support level or above the reaction high crossing at 69.45 are needed to confirm a breakout of December's trading range and clear up near-term direction in the market.  GRAINS http://quotes.ino.com/exchanges/?c=grains March corn closed fractionally higher on Friday following this morning's weekly export sales report, which came in better than expected at 35.82 million bushels. However, weakness in the soybean complex and wheat tempered today's gains in March corn. This week's breakout below key support crossing at 2.10 1/4 has set the stage for a test of weekly support crossing at 2.04 1/4 later this winter. Stochastics and the RSI are oversold but bearish signaling that sideways to lower prices are possible into early-January. The grain markets will be closed on Monday, the last day of this year.  March wheat closed fractionally lower on Friday despite today's announcement that Spain purchased 100,000 metric tonnes of U.S. soft red winter wheat for delivery in the 2001/02 marketing year. Profit taking ahead of the close along with spillover weakness from soybeans pulled March wheat lower on the day. Closes above trendline resistance crossing near 2.94 or below trendline support crossing near 2.83 are needed to clear up near-term direction in the market. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible into early-January.  SOYBEAN COMPLEX http://quotes.ino.com/exchanges/?c=grains March soybeans closed lower on Friday following today's disappointing export sales report, which showed net sales of 21.27 million bushels. The market ignored the monthly crush report for November, which came in at 149.1 million bushels as traders chose to focus on South American's growing crop potential. March beans closed out the week near session lows as it is poised to test weekly support crossing at 4.23 1/2 in the near future.  March soybean meal posted a key reversal down on Friday and closed below minor support crossing at 144.90 despite today's bullish crush report. Multiple closes below this support level would open the door for a test of April's low crossing at 142 later this winter. This week's export sales report was very impressive with net sales of 238,600 metric tonnes. However, thin holiday trading along with a lack of willing buyers allowed locals to push prices lower into the close. Closes above this summer's downtrend line crossing near 151.90 are needed to confirm a bottom and trend change.  LIVESTOCK http://quotes.ino.com/exchanges/?c=livestock February hogs closed higher on Friday due to higher cash bids. However, today's rally was capped by this summer's downtrend line crossing near 56.40. Closes above this resistance level would open the door for a larger-degree rebound into January. Traders went into this afternoon's report looking for a bullish number. Early calls by traders indicated that the report was bullish for the nearby futures but bearish for the deferred contracts.  Hog inventory as of Dec. 1 was 99%, average estimates came in at 99.9%. Hogs kept for breeding came in at 99%, average estimates came in at 99.3%. Hogs kept for marketing came in at 99%, average estimates came in at 100.1%. The marketing and breeding numbers are bullish as the report showed that there has been no expansion despite low feed cost, low interest rates and profits throughout the year. I am looking for higher prices on Monday and possible into next Wednesday now that the report is out of the way. However, this month's rally has already factored in a sizeable portion of today's bullish report into prices already.  February cattle posted an inside day with a higher close on Friday as stronger cash bids underpinned today's rally. Feedlots and packers battled all week before they finally agreed at a $64 minimum bid. Cash sources indicated that there were a few bids at $65 in some areas. Today's higher cash bid came on the heels of lower boxed beef prices this afternoon. Today's high-range close leaves the door open for a possible test of November's high crossing at 71.35 on Monday. Momentum indicators are bullish signaling that this target is within reach of the market.  FOOD & FIBER http://quotes.ino.com/exchanges/?c=food March coffee posted another key reversal down on Friday as the outlook for a bumper Brazilian coffee crop this spring continues to weigh on prices. Trading was light ahead of the upcoming 4-day holiday weekend as traders completed end of the year position squaring. Closes below 44.75 would confirm a breakout into new contract lows thereby opening the door for a possible test of psychological support crossing at 40- cents later this winter.  March cocoa closed slightly higher on Friday thereby confirming yesterday's key reversal up. Early strength tied to spillover short covering from Thursday's rally ran out of gas by mid-session. March will need to close above 1365 or below 1212 to clear up near-term direction in the market. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible into early-January.  March sugar extended Thursday's short covering rebound on Friday due to light fund buying triggered by Syria's tender for 13,000 tonnes of raws and news that Egypt is shopping for 26,000 tonnes of raws and whites for Jan./Feb. shipment. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible into early-January.  March cotton closed lower on Friday as the market ignored today's strong export sales report, which showed net sales of 228,800 bales and focused on the weak U.S. consumption data. The consumption report showed that the annualized adjusted rate for U.S. consumption came in at 7.32 million bales, which was some 100,000 bales below pre-report estimates and is down 19% from year ago levels. Today's close below broken trendline resistance opens the door for a possible test of this month's low crossing at 34.91 in early January.  Daily Extreme Commentary is brought to you by GLOBALcharts,  INO.com's end-of-day charting software for Futures, Futures  Options and Optionable Stocks. http://www.globalcharts.com Search the INO Store  - http://store.ino.com/ _____________________________________________________________________ I N O   N E W S    _____________________________________________________________________ Change In Early Closing Times For Coal Futures    http://news.ino.com/press/?release=27664 Malaysian Derivatives Exchange Now Fully Electronic    http://news.ino.com/press/?release=27663 Software Bug Interrupts Hong Kong Futures Trading    http://news.ino.com/press/?release=27662 ____________________________________________________________________________ E X T R E M E   F U T U R E S ____________________________________________________________________________ Updated every 10 minutes around the clock. More at http://quotes.ino.com/analysis/extremes/futures/ WINNERS NGG2   Henry Hub Natural Gas Feb 2002              2.774     0.166  +6.34 LBN2   Random Length Lumber Jul 2002              276.50     10.00  +3.72 PAH2   Palladium Mar 2002                         449.50     13.50  +3.10 PBH2   Frozen Pork Bellies Mar 2002               81.925     2.000  +2.50 LCZ1   Live Cattle Dec 2001                       67.300     1.200  +1.82 OK2    Oats May 2002                                 175         3  +1.74 PLF2   Platinum Jan 2002                           486.5       8.3  +1.73 SIZ4   Silver Dec 2004                             4.609     0.073  +1.59 PNF2   Propane Jan 2002                           0.3400    0.0050  +1.48 CLG3   Light Sweet Crude Oil Feb 2003              21.23      0.28  +1.30 LOSERS AGM2   Silver 1,000 oz. Jun 2002                   4.210    -0.290  -6.44 RRF2   Rough Rice Jan 2002                         3.690    -0.110  -2.89 HOF2   Heating Oil Jan 2002                       0.5665   -0.0155  -2.67 LBF2   Random Length Lumber Jan 2002              254.00     -6.50  -2.50 CLG2   Light Sweet Crude Oil Feb 2002              20.41     -0.50  -2.39 CTH2   Cotton Mar 2002                             35.59     -0.63  -1.73 OJH2   Orange Juice Froz. Conc. #1 Mar 2002        91.15     -1.60  -1.72 HGH2   Copper Mar 2002                            0.6775   -0.0110  -1.60 HUH2   New York Harbor Unleaded Gasoline Mar 20    0.5983   -0.0090  -1.48 XRF2   Soybean Oil Jan 2002                        15.19     -0.21  -1.37 FREE: Vantagepoint Market Forecast Software Reports  How To Predict The Markets With Up To 80% Accuracy http://www.ino.com/specials/mkttech/vantagepoint.html ____________________________________________________________________________ E X T R E M E   S T O C K S ____________________________________________________________________________ Updated every 10 minutes around the clock. More at http://quotes.ino.com/analysis/extremes/stocks/ WINNERS CHDX   U.S.-CHINA INDL EXCHANGE                  12.2600    3.8900  +42.75 PDGM   PARADIGM GENETICS                          5.7900    1.1800  +25.11 OHI    OMEGA HEALTHCARE INVESTORS                   6.15      1.09  +21.98 MSV    MANUFACTURERS SERVICES                       5.99      1.05  +21.21 ATSI   ATS MEDICAL                                5.7800    0.9800  +20.72 IMMR   IMMERSION CORP                             6.7000    0.9900  +16.92 LSCO   LESCO INC                                  8.2500    1.2000  +16.90 GAIA   GAIAM INC CL A                            21.1500    2.8000  +15.56 XING   QIAO XING UNIVERSAL TEL                    5.3000    0.7000  +15.22 TESTB  TEST SECURITY                            306.9900   38.7400  +14.44 LOSERS GBR    GREENBRIAR CORP                             13.00     -6.15  -32.20 HIST   GALLERY OF HISTORY                         5.1700   -2.2000  -30.34 NANO   NANOMETRICS INC                           19.4050   -5.3000  -21.29 INRG   INRANGE TECHNOLOGIES'B'                   11.9800   -2.4900  -17.18 ASW    A.C.L.N. LTD                                 8.86     -1.80  -16.89 GTPS   GREAT AMERICAN BANCORP                    22.5000   -2.6000  -11.43 BITS   BITSTREAM INC                              6.3510   -0.7800  -11.30 TESTE  TEST SECURITY                             57.1200   -6.3200  -11.07 EFDS   EFUNDS CORP                               13.9500   -1.6800  -10.77 OHB    ORLEANS HOMEBUILDERS                         6.07     -0.75  -10.71 _____________________________________________________________________ T H A N K   Y O U _____________________________________________________________________ Thank you for subscribing to the Extreme Markets Daily Digest from INO.com ( http://www.ino.com/ ). If you want to subscribe to our other email services, or would like to modify your profile please visit http://www.ino.com/email/. 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