Explaining The Problem!!!

S&P 500 Linear Regressions And Opening Range Levels

Below are three charts of the S&P 500 Index. These charts show levels based on the opening range of the calendar year and linear regressions of long, intermediate,and short term. Combining these two concepts, make it possible to estimate when and where potential turning points might be.

S&P 500 Opening Range Levels(click to enlarge)

S&P 500 3day Linear Regression Chart(click to enlarge)

S&P 500 3day Linear Regression Chart short term(click to enlarge)

The volatile moves lately have exceeded the two standard deviation lines(yellow) of the intermediate term linear regression. Friday's recovery reached back and touched the intermediate term linear regression line. To coincide with this move, prices closed just below the short term linear regression line. The move required to return to these levels was over a 100 S&P points. Typically there is consolidation after large moves like this. While the moves could be explained by the financial news last week, it was also enhanced by option expiration on Friday.

The next level on the opening range chart is 1290.63. After the large move last week, it might take a move lower before any attempt is made at this level. 1229.45 is the key level to watch as we consolidate. A failure of this level will lead to more selling. This will almost certainly lead to the market to test the minus two standard deviation levels of the linear regressions of both the short and intermediate term.

NDX Trendlines and Triangles

NDX Nasdaq 100 Index (click to enlarge)

S&P 500 Opening Range Extension 1229.45

Below is a chart of the S&P 500 Index with the extensions created from the opening range created back in the first few days of the year. Once failing at the 1290.63 level, it took very little time to head down toward the 1229.45. Volume also has started to pick up.

S&P 500 Index (click to enlarge)

Gulf Of Mexico Oil Operations

Offshore oil and gas operators in the Gulf of Mexico are evacuating platforms and rigs in the path of Hurricane Gustav. The Minerals Management Service has activated its Continuity of Operations Plan team to monitor the operators’ activities. This team will be activated until operations return to normal and the storm is no longer a threat to the Gulf of Mexico oil and gas activities.

Based on data from offshore operator reports submitted as of 11:30 a.m. CST today, personnel have been evacuated from a total of 223 production platforms, equivalent to 31.1 % of the 717 manned platforms in the Gulf of Mexico. Production platforms are the structures located offshore from which oil and natural gas are produced. These structures remain in the same location throughout a project’s duration unlike drilling rigs which typically move from location to location.

Personnel from 45 rigs have also been evacuated; this is equivalent to 37.2 % of the 121 rigs currently operating in the Gulf. Rigs can include several types of self-contained offshore drilling facilities including jackups, submersibles and semisubmersibles.

From the operators’ reports, it is estimated that approximately 76.77 % of the oil production in the Gulf has been shut-in. Estimated current oil production from the Gulf of Mexico is 1.3 million barrels of oil per day. It is also estimated that approximately 37.16 % of the natural gas production in the Gulf has been shut-in. As of June 2008, estimated current natural gas production from the Gulf of Mexico was 7.0 billion cubic feet of gas per day.

Article Continued At Rigzone