Market Outlook RUT for Dec 31st '07

Market Outlook SPY for Dec 31st '07

Market Outlook NDX for Dec 31st '07

Market Outlook RUT for Dec 26th '07

Pause around current level at first, but definite upward bias.

Market Outlook SPY for Dec 26th '07

Pause between current level and 150.
Overall situation unchanged: if 150 holds, interesting pattern to develop over the next week, leading to possible breakout situation.

Market Outlook NDX for Dec 26th '07

NDX should pause somewhere around current level (could maybe go a little higher and hit 2140).
Overall situation is largely unchanged: trading range with upper bias.

Market Outlook RUT for Dec 24th '07

Similar situation as for SPY.
Short term recovery pattern may be close to completed.

Market Outlook SPY for Dec 24th '07

May retrace up to PR2, maybe crawl to 150.
Daily time frame scenario: same trading range.
If recovery is stopped around 149.50 to 150, we will watch for an interesting pattern with higher lows and lower highs.

Market Outlook NDX for Dec 24th '07

Interesting witching day, interesting friday...

Short term target 2125, but will probably not go much higher.
Trading range scenario is still there for daily time frame.

Market Outlook RUT for Dec 21st '07

Market Outlook SPY for Dec 21st '07

Market Outlook NDX for Dec 21th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - poor fit - low significance level
Market Direction:

As a reminder: market direction above is always based on the daily time frame, even if 60mins is the dominant time frame.
We have to accept in such case that the daily time frame may be more difficult to read.
Secondly, provided direction is given for 3 to 5 bars, sometimes more. On the 60 mins chart, a change in dynamics may occur during the course of the day.
Users will obviously adapt to dominant time frames at the time (5 and 10 mins yesterday)

60mins: up
Fib PR1 near 2060 passed late in the day, but it is probably an effect typical of witching days. It will go higher to the next level: 2074 or even 2090.

Daily: congestion to down
Despite yesterday's up day, we shall remain cautius it could be short-lived. The 60mins chart is certainly more significant (91%) but at 77% the down pressure expressed by MTFS and Entropy cannot be discarded.
Opposing situation should in the short term favour the 60mins chart which is the dominant time frame, but congestion is likely at this time frame.
NB: One can again notice an MM octave (i.e. 8 sublevels between 2000 and 2125), so levels will be marked at 2031 and 2062 and 2093.

Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX has touched and bounced from the lower part of its channel, but the weekly bar is still red. Caution should be exercised at these levels. We would be in trouble if 2000 would break...

Market Outlook RUT for Dec 20th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: UP-DN-DN (from UP-DN-DN)
Cycles: up - good fit - average to good significance
Market Direction: congestion with a lower bias, but caution on this key 740 level

We can see opposing MTFS patterns with the same significance level, indicating likely congestion

60 mins: up to Fib PR1, but then what...?
Some lethargic revovery which should crawl to Fib PR1 (almost hit it late in the day), but as we have seen recently, the MTFS crossover is indicative of a 'failing recovery' pattern. RUT should therefore not go much higher.
750 has been tested during the course of the day, and could tested again.

daily: trading range is likely, but support must be confirmed.
Again, no change from yesterday:
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. There are no signs of a recovery (except for the cycle indicator) so RUT should fluctuate within the lower part of the [750-780] trading range. Should volatility increase, the range can be [740-790] .
NB: Cycles are the least reliable indicators in our toolset, and can only help determining turning points when all indicators point in the same direction, which is not the case at the moment.

weekly: Same trading range [750-875] with lower bias. Caution must be exercised on key level.
Swing is down and MTFS and Entropy are certainly not looking too good. One should remain VERY cautious on these levels. A market fall on level breakout is a scenario which cannot be discarded.

Market Outlook SPY for Dec 20th '07

Dominant TF: 60mins & Daily
Swing: DN-DN-UP (from UP-DN-UP)
Cycles: up - good fit - low to average significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Swings oscillate a lot on all 3 charts, indicating a key level nearby.

60mins: congestion to only moderatly up
MTFS and Entropy indicate congestion to a trading range on this triple witching day. Slight upward bias.

Daily: support has been hit but congestion is likely, no excessive optimism just yet.
Same as the day before:
Bar is still red, MTFS and Entropy are not looking fantastic, so we have to wait for the support to be confirmed. MTFS lines being in median territory, there should be any major pressure either way, direction coming from line gradients.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
Swing is oscillating again indicating we might be close to a key level at this point in time. Caution should therefore be exercised.

Market Outlook NDX for Dec 20th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - low significance level
Market Direction: No strong rebound on 2000... NDX could go either way...

Again, it is more fun on 5 and 10mins time frames. Users of the technique generally select 2 or 3 time frames among 6 to determine the best trading environment.

60mins: directionless, slight upper bias
A priori nothing much to expect today but surprises are always possible on witching days.
After finding an intraday support at 2016, indicators point for a slight upward bias, aiming at crawling to Fib PR1.

Daily: congestion to down
We would like to be optimistic after 2000 has been hit, but swing is down, bars are red, MTFS and Entropy have negative gradients, so we'll have to wait a bit. 2000 looks strong enough for now, so congestion is likely.
One may also notice an MM octave (i.e. 8 sublevels between 2000 and 2125), so levels will be marked at 2131 and 2162.


Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX is touching the lower part of its channel, and the weekly bar is red. Caution should be exercised at these levels. We would be in trouble if 2000 would break...

A little break...

Not a bad time to take a break and enjoy quality time with the family.
There will therefore be no posting in the next 2 weeks unless some exceptional market move warrants it.

Please contact me however if you need an update or advice mailed to you.

cheers to all,
bv

Market Outlook RUT for Dec 19th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: UP-DN-DN (from DN-DN-DN)
Cycles: up - average fit - low significance
Market Direction: congestion with a lower bias, but caution on this key 740 level

Similar situation as SPY.

60 mins: Key level [740-750] needs to be confirmed
The market did not allow RUT to venture dangerously below 740, and then a good recovery late in the day after Entropy bottomed out.
Like for SPY, the MTFS crossover is not too exciting, so one would need a support level like 750 to be confirmed first.

daily: trading range is likely, but support must be confirmed.
No change from yesterday:
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. There are no signs of a recovery so RUT should fluctuate within the lower part of the [750-780] trading range. Should volatility increase, the range can be [740-790]

weekly: Same trading range [750-875] with lower bias. Caution must be exercised on key level.
Swing is down and MTFS and Entropy are certainly not looking too good. 740 is Fib PR2 (61.8%). RUT has always bounced on PR2 in the last 2 years, but one should remain VERY cautious still.

Market Outlook SPY for Dec 19th '07

Dominant TF: 60mins & Daily
Swing: UP-DN-UP (from DN-DN-DN)
Cycles: up - average fit - low significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Swings turned up on 60mins and weekly charts, indicating a key level nearby.

60mins: congestion to only moderatly up
Like NDX, bears aimed at testing 143.75 and almost got there. The Low EntBin at the bottom gives good recovery potential but the MTFS crossowver is messy, indicating there could be a slowdown before going higher.

Daily: support has been hit but congestion is likely, no excessive optimism just yet.
Bar is still red, MTFS and Entropy are not looking fantastic, so we have to wait for the support to be confirmed. MTFS lines being in median territory, there should be any major pressure either way, direction coming from line gradients.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
Swing is oscillating again indicating we might be close to a key level at this point in time.

Market Outlook NDX for Dec 19th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - low to avg significance level
Market Direction: No strong rebound on 2000

Again, it is more fun on 5 and 10mins time frames. Users of the technique generally select 2 or 3 time frames among 6 to determine the best trading environment.

60mins: No strong rebound on 2000.
After testing stall level early in the day, traders pushed the market down to 2000. However bears momentarily left their position after a quick skirmish on support level.
EntBin was at -3 at the bottom on 2000 but MTFS lines didn't cross in a "clean" way. NDX should stay in the same range and possibly test a support level again (2016?)

Daily:
2000 has been hit, but what next...? I'm afraid we have to wait a few more days (i.e. after triple witching). Like for the 60mins chart, we cannot expect any strong rebound.

Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX is touching the lower part of its channel, and the weekly bar is red. Caution should be exercised at these levels.

Market Outlook RUT for Dec 18th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-DN-DN (from DN-UP-DN)
Cycles: up - average fit - average significance
Market Direction: congestion with a lower bias, but caution on this key 740 level


60 mins: Key level [740-750]
MTFS and Entropy are still pointing lower on this key level.
This support level should be fought, but no significant rebound expected before negative entropy is exhausted.
There is a support level at 734, but more generally: breaking 740 would be "dangerous".

daily: trading range is likely, but support must be confirmed.
No change from yesterday:
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. IT is likely that these [740-750] levels will be be fought, and who knows whether bears or bulls will win. At the moment, only the cycle indicator points up, and we know it is not always a reliable predictor.
Trading range in the [750-780] range to [740-790]

weekly: Same trading range [750-875] with lower bias
Swing is down and RUT is certainly not looking too good. 740 is Fib PR2 (61.8%). RUT has always bounced on PR2 in the last 2 years, but one should remain very cautious still. The next strong support level is indeed much lower....

Market Outlook SPY for Dec 18th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-DN-DN (from DN-DN-UP)
Cycles: up - good fit but low significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Fairly good quality cycles on daily chart pointup upward in the short to medium term.

60mins: down
Like for NDX, the acceleration down came a little bit as a surprise. The lower part of the trading range (147) was broken to reach the next level down. Now, while there could be a pause, SPY seems to point towards 143.75. MTFS and Entropy indeed do not indicate a bottom just yet.

Daily: congestion is likely, but wait for support to be confirmed.
After 146.8 was broken, SPY surprisingly accelerated to the next support level which is also a stronger Fib level. While a strong rebound looks unlikely, congestion is now quite possible with MTFS lines hovering median territory.
MTFS and Entropy gradients indicate some weakness, but no reason to panic just yet.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
Note that Swing has turned down again.

Market Outlook NDX for Dec 18th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low to avg significance level
Market Direction:
lower until next support

60mins: 2000 is now in sight.
As I thought, the down move accelerated (cf Entropy) during the course of the day, which is a good sign as it is always best having a support level hit with some energy to generate some reaction.
MTFS and Entropy are not indicating a bottom just yet. However, stall level is about here at 2016, and the strong support level at 2000 is in sight now. There seems to be still too much energy to stop the fall on 2016, even if a pause should at least be marked at that level first.

Daily: lower til support is found (2000)
I admittedly missed this volatility spike, and thought support levels on the way down would hold at least for a while. It is not uncommon to see MM levels acting as attractors, particularly after a slowdown period.
However, MTFS lines while turning down do not indicate a significant move, so a strong support level like 2000 should hold. We shall obviously remain cautious.

Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX is touching the lower part of its channel, and the weekly bar is red. Caution should be exercised at these levels.

Market Outlook RUT for Dec 17th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-DN-DN (from DN-UP-DN)
Cycles: up - good fit
Market Direction: congestion with a lower bias

Like for NDX and SPY, it is likely that the next support level (750) will be key to forthcoming direction.

60 mins: Support level may have to be found lower
MTFS points lower and Entropy is stable, indicating continuation of price erosion. One should obviously pay attention at RUT's behaviour on 750, but like for other symbols, we're not in a situtation of a potential stronger rebound. RUT could therefore remain congested in the low 750s, or even try and test previous lows around 740.

daily: congestion.
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. IT is likely that these [740-750] levels will be be fought, and who knows whether bears or bulls will win. At the moment, only the cycle indicator points up, and we know it is not always a reliable predictor.

weekly: Directionless with a lower bias for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias.
The weekly bar surprisingly did not end up turning red. Again behaviour on 750 will be key.

Market Outlook SPY for Dec 17th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-DN-UP (from DN-UP-UP)
Cycles: up - good fit
Market Direction: No change in overall direction just yet, but a support must be found soon

Fairly good quality cycles on daily chart pointup upward in the short to medium term.

60mins: Lower bias, check behaviour on 147.
SPY started the day directionless but the 147 level acted as an attractor. There isn't much negative energy so no reason to believe it will go much lower at this point in time.
The trading range should remain in the lower part of [147-150].

Daily: slightly up after support is found shortly.
MTFS white line is showing signs of weakness and Entropy has now peaked. We have to watch for Fib support levels (146.8, then possible 145.3). SPY could well stay congested within a [147-153] trading range.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 17th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low significance level
Market Direction:
Congestion with a lower bias at first.
Will support be found on 2062 ??

60mins: congestion to lower bias.
Like for RUT and SPY, NDX will have to test the next 2062 support level (Fib + MM) but should there some acceleration on the down side, NDX being generally quite volatile, a support around 2050 is also possible.
For the time being, one should not try and read what is not in the prices yet, and congestion with continuation of this drifting situation is a more likely scenario.

Daily: moderately lower
MTFS and Entropy are slowing down further, so some NDX will continue drifting until the next support level. Note that there is no negative energy just yet, so this is not a reversal situation.

Weekly: congested to lower bias.
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Jingle bells...

First, I wish you all the best for the festive season!

I am going to take it a little easier after triple witching day, and will only post one daily commentary on RUT and only if the market situation warrants it. Indeed, apart from some large funds and institutions doing some window dressing on year close, there is generally a slowdown so commentaries can be quite similar day after day.

In case a specific advice is however needed, please contact me by mail.

Market Outlook RUT for Dec 14th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-UP-DN (from DN-UP-DN)
Market Direction: congestion with a lower bias

Read previous general comments on SPY and NDX.
Patterns are different, but dynamics are correlated.

60 mins: Support level may have to be found lower
RUT seems to have found support around the high 750s, which corresponds to a weak Fib level and a MM stall level (not quite justified). RUT could therefore drift lower to 750.
At the same time since MTFS is only moderately bearish, RUT may just remain congested in more or less the same trading range.

daily: congestion.
MTFS and Entropy are again weakening a bit, so we may have some congestion ahead. Again, the MTFS recovery pattern looks more and more like the 'failed recovery' pattern mentioned about a week ago. Support will be found around 757 (Fib) or right down to 750. Since there is no clear direction in the short term, one may take yesterday's low (759.20) as the stronger base we need to go higher.

weekly: Directionless with a lower bias for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias. A weekly up bar, and if not blue, at least yellow, would confirm a safe return to the trading range.

Market Outlook SPY for Dec 14th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-DN (from DN-UP-UP)
Market Direction: No change in overall direction just yet, but lower bias in the short term

Similar comments as NDX.

60mins: Congestion within the same trading range.
We've had about the same situation with a recovery in the last couple of hours. 147 was not clearly hit though.
MTFS lines still have a slight bearish outlook, but it seems like SPY could be directionless.
The trading range should remain [147-150].

Daily: up technically but congestion to mild retracement at first.
MTFS white line is showing signs of weakness and Entropy is very high (Bin=5) and close to peaking.
We're therefore probably ahead of a congestion period within a [147-153] trading range..

Weekly: Congestion to moderate upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 14th '07

Dominant TF: 60mins (and lower)
Swings: DN-UP-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low significance level
Market Direction:
Congestion with a lower bias at first.
Has support been found (2062?) ??

Again, and sorry to repeat myself: this is a perfect environment for intraday traders. All lower time frames have a significance level higher than these ones. In addition, the environment is about the same as the day before.

60mins: congestion to lower bias.
Yesterday's commentary was again quite valid.
A support may have been found, yet there is still a bit of negative bias in MTFS and Entropy. The half-way MM level which looks like a support level right now is the well known 'stall' level. The fall was however not quite fast enough to justify it, so it is likely that a stronger base will be found lower (2062?). The uncertainty comes more from this 'drift' situation showing a lack of internal dynamics.

Daily: congestion at first
MTFS and Entropy suggest a slowdown, so some congestion ahead is likely. A second red bar may suggest we need a stronger support level to go higher.

Weekly: congested to slightly up
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Market Outlook RUT for Dec 13th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-UP-DN (from UP-UP-DN)
Market Direction: possible congestion and higher volatility ahead.

Read previous general comments on SPY and NDX.
Patterns are different, but dynamics are correlated.

60 mins: Support level may have to be found lower
The 765 support level seems to hold, but MTS definitely has a lower bias, so it may be tested again. Entropy is quite low and could well bottom out once support is confirmed.

daily: congestion to moderately up in a high volatility environment.
MTFS and Entropy are weakening a bit, so we may have some congestion ahead. Again, the MTFS recovery pattern we've seen is certainly not our favourite, so we need a stronger base to go higher.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias. A weekly up bar, and if not blue, at least yellow, would confirm a safe return to the trading range.

Market Outlook SPY for Dec 13th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-UP (from DN-UP-UP)
Market Direction: No change in overall direction just yet, but lower bias in the short term

Similar comments as NDX.

60mins: Support must first be found (~147?)
Like the day before, and despite the recovery late in the day a support must be clearly found first.
MTFS lines confirm some moderate bearish outlook, but this may change upon even a mild recovery after support is confirmed.
Significance level is dropping fast indicating one should follow short time frames for entries and exits, and look for direction or absence thereof on this daily chart.

Daily: up technically but congestion to mild retracement at first.
MTFS white line is showing signs of weakness and Entropy is very high (Bin=5) and close to peaking.
We're therefore probably ahead of a congestion period.

Weekly: Congestion to moderate upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 13th '07

Dominant TF: 60mins (and lower)
Swings: DN-UP-UP (from DN-DN-UP)
Market Direction:
Congestion with a lower bias at first.
Has support been found (2062?) ??

Again, this is a perfect environment for intraday traders, All lower time frames have a significance level higher than these ones.

60mins: high volatility - support may be found lower.
Yesterday's commentary was again quite valid.
Now it isn't clear whether support has been clearly found yet. Bars are red, lows are lower... MTFS and Entropy also point down: the bounce we had may have been short-lived at least for now.
MTFS does not look very bearish either so we may have a lower support around 2062, and then more congestion...

Daily: congestion to mildly up
MTFS and Entropy suggest a slowdown, and indeed a stronger bounce on 2062 may be needed to go higher.
One has to be careful though. It would be good to see a Up day, and at least a yellow bar to make sure NDX does not congest a little lower.

Weekly: congested to moderately up
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Market Outlook NDX for Dec 12th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from UP-UP-UP)
Market Direction: Support must be found (2062?) - no change in overall direction just yet.

Yesterday's warning was certainly warranted, and the drop after the Fed announcement was quite interesting to follow on a 5 minutes chart. At this point in time, it pays off to go lower in time frames (all have a significance level higher than these ones)

60mins: high volatility - good possibility of a bounce once support is found.
After indeed hitting a high at 2147, NDX took a bit of a knock to close around Fib PR2 (61.8%). Should this level now break, since there is still some negative sentiment, NDX could well go lower to the 2062 pivot level.
MTFS is again not showing a clear pattern, which may indicate continuation of a congestion in a high volatility environment.

Daily: Up
Despite yesterday's drop, the pattern remains unchanged, and the bar even remained blue. We may have a second down day, but surprisingly one cannot say there is a retracement coming.
One should obviously be cautious, but not bearish quite yet.

Weekly: congested to moderately up
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Market Outlook RUT for Dec 12th '07

Dominant TF: Daily, 60mins
Swings: DN-UP-DN (from UP-UP-DN)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.


60 mins: RUT should stabilise on support level
RUT first hit its Fib target but then ended the day much lower on a strong intraday support level (765.63). Since there is still some negative energy to dissipate, it may go lower or at the very least remain in a congested trading range. Should the current level break (which is not visible right now) the next support level would be 750.
MTFS is not very bearish right now, but definitely indicates a lower bias.

daily: up & bumpy
We've now got the little bit of volatility we've expecting for a few days. The overall up pattern remains unchanged in the short term.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias. A weekly up bar, and if not blue, at least yellow, would confirm a safe return to the trading range.

Market Outlook SPY for Dec 12th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-UP (from UP-UP-UP)
Market Direction: No change in overall direction.

Similar comments as NDX.
Short term intraday traders must have smiled ear to ear

60mins: Support must first be found (~147)
Reaction to the Fed announcement was stronger than expected, and support may now be found on recent lows around 147. MTFS lines have crossed and look bearish in the short term, but one should wait for the pattern to form over the next few bars (maybe up to a day).

Daily: up technically but a support must be confirmed.
Yesterday's comment was quite valid. Now, MTFS and Entropy have little changed after yesterday's down day so one should expect support to be found and SPY to bounce up again.
A word of caution though: SPY about hit its Fib target before the fall, so last pattern can be seen as completed and a new down leg could start. Secondly, we may have congestion around pivot level for a while, so even if we have a bounce soon, behaviour on 150 will have to be watched carefully.
I also wish to remind a comment made over a week ago. Such MTFS crossover was not indicative of a stable recovery pattern, and we did not 'get' our retracement to confirm a return to the up trend.

Weekly: Congestion to upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook RUT for Dec 11th '07

Dominant TF: Daily, 60mins
Swings: UP-UP-DN (from UP-UP-UP)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.
One shall note that Swing on weekly chart has turned down again. This may mean like for SPY that RUT is sitting on a key level.

60 mins: congestion
We have a little bit of energy left to eventually bring RUT a little higher, but MTFS certainly looks congested. Targets are just around the corner anyway: 795 Fib target + 797 MM level.

daily: up & bumpy
Virtually no change since yesterday:
We have seen the recovery pattern actually materialising after RUT tested 750 again to bounce quickly to current levels. Again this type of recovery is seldom stable, and it would be surprising to see it going higher without some retracement, so there could be more volatility ahead.
A pivot no4 now appears, so let's see how RUT behaves on 795.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. RUT is certainly on a key level but the blue bar is reassuring, so a weekly up bar would confirm a safe return to the trading range.

Market Outlook SPY for Dec 11th '07

Dominant TF: Daily
Swing: UP-UP-UP (from UP-UP-DN)
Cycle: Daily 128: Avg
Market Direction: Upper bias but possible congestion

Similar comments as NDX.
Swing turned up on weekly chart indicating this could be a key level.

60mins: Congestion to slight upper bias.
Virtually no change:
Significance level is coming down, ahead of MTFS pattern completion. We would prefer a crossover in overbought territory, but looking at current line gradients, that may just not happen. Entropy is still positive so MTFS can still crawl slightly upward in the short term. Testing 150 for support would be a good sign for bulls. A significant retracement is unlikely at this point in time (i.e. currently in price dynamics).

Daily: technically up, but behaviour on 151 must be still watched very carefully.
We unfortunately have little more to say today:
SPY now hit PR2 (61.8% Fib retracement) and hovered there. MTFS is however bullish now so SPY could well reach next Fib target (just above 153).
We must however as always remain very cautious. Continuation of congestion or even a retracement are quite possible in the short term.

Weekly: Upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 11th '07

Dominant TF: 60mins (and lower)
Swings: UP-UP-UP (from UP-UP-UP)
Market Direction: Moderately up but watch 2140 level

Market not expected to move much ahead of Fed announcement and forthcoming triple witching day. Dominant time frame is around 15 to 30mins, so users of the technique will better appreciate current dynamics.

60mins: congestion to upper bias
MTFS is not showing a clear pattern yet, and we can only hope lines will join soon. In the meantime, one can only anticipate the continuation of the current congestion with an upper bias.

Daily: Up, but first fib target has been hit on 2140
MTFS and Entropy point towards going higher to 2185 and 2250 but a resistance has been hit at 2140. We could therefore see a little bit more congestion ahead, but certainly no retracement in sight just yet. Should congestion linger on, we'll have to watch Entropy potentially peaking though (LEntBin=4) over the next few days. In other words, behaviour on 2140 will determine forthcoming direction.

Weekly: up...
NDX is half-way in its channel again, and the bar has not turned blue. Significance level has fallen to 44% which is understandable as current moves are way too fast for this time frame.
One shall note that around 2125 the swing indicator oscillates between UP and DN.

Market Outlook RUT for Dec 10th '07

Dominant TF: Daily, 60mins
Swings: UP-UP-UP (from UP-UP-DN)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.

60 mins: congestion
Friday ended up as congested after boucing again on 781. We however have little energy to bring RUT much higher in the short term. Having said that, we should keep in mind a possible (longer term) Fib target of 795 now (with MM level at 797) that the 781 support seems confirmed.

daily: up & bumpy
We have seen the recovery pattern actually materialising after RUT tested 750 again to bounce quickly to current levels. Again this type of recovery is seldom stable, and it would be surprising to see it going higher without some retracement, so there could be more volatility ahead.

weekly: Directionless
Same situation: range [750-875]
Swing turned up but it is far too early and the angle is too steep to consider this up swing stable.
RUT is not out of the woods just yet.

Market Outlook SPY for Dec 10th '07

Dominant TF: 60 mins and Daily
Swing: UP-UP-DN
Cycle: Daily 128: Avg
Market Direction: Upper bias but possible congestion

Similar comment as NDX.
SPY surprisingly passed the 150 level late in the day to almost hit PR2 (151.06).

60mins: Congestion to slight upper bias.
Significance level coming down a bit, ahead of MTFS pattern completion. We would prefer a crossover in overbought territory, but looking at current line gradients, that may just not happen. Entropy is still positive so MTFS can still crawl slightly upward in the short term (even some congestion above 150 could be good enough).
A retracement is unlikely.

Daily: technically up, but behaviour on 151 must be watched very carefully.
We unfortunately have little more to say today:
SPY now hit PR2 (61.8% Fib retracement) and hovered there. MTFS is however bullish now and current resistance level should technically be broken. We must however as always remain very cautious. Continuation of congestion or even a retracement are quite possible in the short term.

Weekly: Upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 10th '07

Dominant TF: 60mins (and lower)
Swings: UP-UP-UP (from UP-UP-DN)
Market Direction: Moderately up - behaviour on 2125 is key

We've had some congestion as expected (MM + Fib + undecisive MTFS).

60mins: congestion, but behaviour on key resistance level may cause some congestion.
MTFS is again not showing a clear pattern, and we can only hope lines will join soon. In the meantime, one can only anticipate the continuation of the current congestion with an upper bias. Entropy is holding quite well, so a retracement is unlikely.
Current level is a mix of Fib and MM levels. Possible longer term target remains [2185-2190].

Daily: Up, but reversal around 2125 remains possible while unlikely.
We have the same scenario going on with a bit of a slowdown on the way to 2185 and 2250. There could be a little bit more congestion ahead, but no retracement in sight just yet. We'll have to watch Entropy potentially peaking though (LEntBin=4) over the next few days.

Weekly: up...
NDX is half-way in its channel again. We don't have a blue bar yet though. Significance level has fallen to 44% which is understandable as current moves are way too fast for this time frame.
One shall note that the swing indicator oscillates between UP and DN at current levels.

Market Outlook RUT for Dec 7th '07

Dominant TF: Daily, 60mins
Swings: UP-UP-DN
Cycle (DomTF): 128: Avg to Good
Market Direction: Upper bias.

(Read previous general comments on SPY and NDX)

60 mins: upper bias
781 seems broken even though this happened late in the day, and could be reversed within an hour or two. Assuming it is confirmed, the next target is in the low 790s now. Again, the MTFS pattern is not the clearest we've had, so we just have to wait lines finally join. We may have the same kind of wavy climb until the major resistance is reached.

daily: up & bumpy
We have seen the recovery pattern actually materialising after RUT tested 750 again to bounce quickly to current levels. It didn't fail but the possibility was definitely there. Amazing volatility...
It is now proabably too late to see a significant retracement, but one should see continuation of the high volatility environment with possible pauses on the way to 812.

weekly: Directionless
Same situation: range [750-875]

Market Outlook SPY for Dec 7th '07

Dominant TF: 60 mins and Daily
Swing: UP-UP-DN
Cycle: Daily 128: Avg
Market Direction: Upper bias but possible congestion

Same comment as for NDX.
SPY surprisingly passed the 150 level late in the day to almost hit PR2 (151.06).

60mins: Upper bias.
We now have to wait until the MTFS pattern completes in overbought territory. We are in between decision points and the pattern certainly isn't the easiest to read right now. while an upper bias is obvious, congestion on Fib or MM level is more than possible.

Daily: up, but behaviour on 151 must be watched carefully.
As said above, SPY almost reached PR2 (61.8% Fib retracement). MTFS is fairly bullish now, and one can only be a little frustrated it never completed the previous down pattern (crossover in oversold territory). It seems a little too late now to see a substantial retracement, but a pause is quite possible.

Weekly: Upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 7th '07

Dominant TF: 60mins (and lower)
Swings: UP-UP-UP
Cycles: 128:Weak, 64:Average
Market Direction: Moderately up - behaviour on 2125 is key

Uninspired commentators will say that some economic news fueled a 2-day rally, and allowed NDX to prematurely reach a major resistance level in the short term (60mins). The truth is that there are indeed occasions of spurrious volatility which turn targets into attractors. While difficult to detect, such self-induced momenta generally do happen when there is virtually no upward or downward pressure to control them. Intraday traders will have switched to a 15mins chart, while our interpretation remains within the scope we had in mind. More important is what's coming next now that NDX has reached that key level.

60mins: Upper bias, but behaviour on key resistance level may cause some congestion.
The MTFS pattern has not been the easiest to read, with that second bout of rallying starting from median territory. Such moves generally carry little energy, hence it is surprising NDX reached its resistance level so quickly. Now the pattern has to complete somwehow with lines joining either in overbought territory... or oversold territory.
At this point in time, volatility is high in a market that is looking for a pause.
Current target [2125-2133]. Possible longer term target [2185-2190].

Daily: Up, but recovery pattern is weakening a bit in the short tem
Despite this 2-day rally, the MTFS pattern is showing moderate signs of weakness,and while Entropy has been increasing, LEntBin = 4, so is quite high. That would tend to predict if not a retracement, at least a pause in the coming days. Longet term, the 2250 targetis back on track.
In the short term, targets would be easier to predict if MM and Fib levels somehow coincided, but no luck this time... It is not clear whether the upper bias we still have will bring NDX a little higher (2140?) or whether a period of congestion is imminent. No retracement in sight just yet, but we'll have to watch Entropy over the next few days.

Weekly: up...
NDX is half-way in its channel again. We don't have a blue bar yet though.
Surprisingly enough, 2000 is still a major resistance level at this time frame.

Market Outlook RUT for Dec 6th '07

Dominant TF: 60mins & Daily.
Swings: DN-UP-DN (from DN-DN-DN)
Market direction: Congestion to moderately down.

OK, same story... (see SPY and NDX posts) Yesterday's bullish day came a little bit as a surprise, but the market has always surprised with sudden bouts of volatility lately. This does not really change our scenario.

60mins: Congestion.
MTFS still indicates a fairly directionless market, now with an upper bias, but this does not mean it will not now drift a little. One may note that the Swing indicator has not turned up. Like for other symbols, RUT can either remain in the same [750-767] range or jump to the one above [767-781].

Daily: congestion
Exact same situation:
As explained a couple of days ago, we have a typical failed recovery pattern, so we now have to see how it develops (double bottom, cup & handle, or ... downright fall!). For the time being, there is not enough energy for any scenario to develop fast (EntBin = 0).
Note: the cycle detection also gives us a dual frequency possibly causing a momentary congestion due to a phase offset.

Weekly: return to the trading range, but lower bias still.
We're now back in our [750-875] range, with a lower bias. One can only hope that 750 will hold...

Market Outlook SPY for Dec 6th '07

Dominant TF: 60mins & Daily
Swings: UP-UP-UP (from DN-UP-UP)
Market direction: congestion - behaviour on 150 is key.

I warned yesterday of some difficulty in reading the current market, particularly in the short term (60mins chart).

60mins: Up bias (150?) but otherwise a trading range is likely
Pattern not much clearer, indicative of a possible trading range with an upper bias. SPY will either remain in the same [147-148.5] range, or jump to the next one [148.5-150]. We unfortunately have to wait for MTFS lines to group up for the next pattern to emerge.

Daily: congestion to mildly up
Similar situation as yesterday and the day before:
With now both 60mins and daily chart with equivalent significance levels, and a MTFS pattern that is typical of a failed recovery, it is not easy to make head or tail of this market. Entropy on both charts also aim at different directions.
We now have to wait for a pattern to develop, possibly a cup & handle formation. There is however no downward pressure right now, and we have to reach 150 again soon otherwise the 'failed recovery' pattern will become a more likely possibility.

Weekly: congestion to moderately down - very low significance level.
This time frame has such a low significance level it is almost pointless reading it. We can only rely on the Swing indicator as well as MM and Fib levels. For the time being, it is safe to say that we are in a broad trading range with a downward bias. Failure to pass the 150 strong resistance level would become alarming if significance level wasn't so low.

Market Outlook NDX for Dec 6th '07

Dominant TF: 60mins
Swings: UP-UP-DN (from DN-UP-UP)
Market direction: recovery potential weakening but the recovery pattern is still there.

I admittedly got it a little wrong on the 60mins i.e. short term yesterday, but the MTFS did not help us with a clear pattern, and we knew we had some opposition with the daily chart. NDX bounced strongly on the 50% retracement level, which I did not quite anticipate. Let's see how this conflictual situation now develops.

60mins: congestion to up.
The Fib pattern could obviously develop further, but there again, MTFS is not offering us a convincing pattern. Despite the burst of energy, Entropy could peak soon. The bias is up, but until 2125 is passed, NDX should stay in the current trading range [2062-2094] or jump to the one above [2094-2125]

Daily: congestion to slightly up
Despite yesterday's up day, the recovery pattern is still weakening indicating difficulty in reaching its Fib target. Entropy may even peak soon at this low level (EntBin = 3). Again it is essential that 2125 is passed so that NDX returns to the overall bullish trend and reaches Fib targets (2140 first), with 2250 being very significant (strong MM resistance as well). Failure to pass 2125 over the next few days, while not really anticipated should be watched carefully.

Weekly: trading range - lower bias
NDX is back into its channel, and bar colour is turning to yellow. However current movements are too fast for this time frame at the moment, explaining the low significance level (53%).

Market Outlook RUT for Dec 5th '07

Dominant TF: 60mins & Daily.
Swings: DN-DN-DN (from UP-UP-DN)
Market direction: Congestion to down.

Similar to SPY, RUT is also drifting down. Yet, a stronger support is near at 750.

60mins: Congestion.
Same as yesterday, except RUT now has to deal with the 750 - 752 support level. MTFS seems to still point a little downward, so behaviour on this key level will be interesting to watch. It is likely that RUT will remain fairly direction less on that level.

Daily: congestion
As explained a couple of days ago, we have had a typical failed recovery pattern, so we now have to see how it develops (double bottom, cup & handle, or ... downright fall!). For the time being, there is not enough energy for any scenario to develop fast.
Note: the cycle detection also gives us a dual frequency possibly causing a momentary congestion due to (near) phase opposition.

Weekly: return to the trading range, but lower bias still.
We're now back in our [750-875] range, with a lower bias. One can only hope that 750 will hold...

Market Outlook SPY for Dec 5th '07

Dominant TF: 60mins & Daily
Swings: DN-UP-UP (from DN-UP-DN)
Market direction: congestion.

Yesterday's anticipation proved right, and today's scenario is about the same. Market readability is however not improving due to opposite information emanating from both dominant time frames.

60mins: congestion to moderately down
Pattern is unclear. Same mild downward bias until some support is found (Fib PR1?).
Note: Rate of decline is close to the natural angle of repose.

Daily: congestion to mildly up
Similar situation as yesterday:
With now both 60mins and daily chart with equivalent significance levels, and a MTFS pattern that is typical of a failed recovery, it is not easy to make head or tail of this market. Entropy on both charts also aim at different directions.
We now have to wait for a pattern to develop, possibly a cup & handle formation. There is however no downward pressure right now, so difficult to estimate where a stronger support level will be found. At the same time, we also have to reach 150 again soon otherwise the 'failed recovery' pattern will become a more likely possibility (new pivot no4 has been detected).

Weekly: congestion to moderately down - very low significance level.
This time frame has such a low significance level it is almost pointless reading it. We can only rely on the Swing indicator as well as MM and Fib levels. For the time being, it is safe to say that we are in a broad trading range with a downward bias. Failure to pass the 150 strong resistance level would become alarming if significance level wasn't so low.

Market Outlook NDX for Dec 5th '07

Dominant TF: 60mins
Swings: DN-UP-UP (from DN-UP-UP)
Market direction: recovery potential weakening but the recovery pattern is still there.

NDX came down a bit as expected, and is hovering around 2054 50% Fib level and 2062 MM level.

60mins: congestion to mild retracement.
Very similar to yesterday:
Continuation of price erosion until a support is found possibly around current levels but probably a little lower to next MM/Fib level (2054, then 2040) . There should be no serious downward acceleration though.

Daily: congestion to slightly up
Similar analysis:
The recovery pattern is weakening a bit indicating difficulty in reaching its Fib target. The dominant time frame being 60mins, one must be more cautious, so again the 60mins support level will have to be watched. It is essential that 2125 is passed so that NDX returns to the overall bullish trend and reaches Fib targets (2140 first), with 2250 being very significant (strong MM resistance as well).
Note: a new pivot (no5) is being detected on 2125, so failure to reach 2125 might soon translate into a down swing.

Weekly: trading range - lower bias
NDX is back into its channel. However current movements are too fast for this time frame at the moment, explaining the low significance level (53%).

Market Outlook RUT for Dec 4th '07

Dominant TF: 60mins & Daily.
Swings: DN-DN-DN (from UP-UP-DN)
Market direction: Congestion.

Like other symbols, RUT is also drifting down.

60mins: Congestion.
Again, MTFS points towards a congestion with lower bias, but now that PR1 seems broken, there may be some acceleration to the next support level, close to 757 or even 750.

Daily: congestion
This early MTFS crossover is very seldom conducive to a definite change in direction (typical failed recovery pattern). A congestion is likely, and RUT should try and find a stronger base for support.
RUT indeed seems to show evidence of a cycle turning point, so any retracement should be limited (757, and 750 in the worst scenario).
Note: the cycle detection also gives us a dual frequency with a momentary congestion due to phase opposition.

Weekly: return to the trading range, but lower bias still.
We're now back in our [750-875] range, and still pretty much directionless. It seems that the 'double top' scenario is now a little more remote, but we should wait for the bar to at least change colour first. Until then the bias remains down.

Market Outlook SPY for Dec 4th '07

Dominant TF: 60mins & Daily
Swings: DN-UP-DN (from DN-UP-DN)
Market direction: congestion.

SPY is hovering between levels, and only has lost all positive energy, hence is drifting.

60mins: congestion to mildly down
One can only anticipate the same moderate price erosion until support is found. Despite being the dominant time frame, there isn't much to read in MTFS and Entropy except there isn't much downward pressure either.

Daily: congestion to mildly up
Similar situation as yesterday:
With now both 60mins and daily chart with equivalent significance levels, and a MTFS pattern that is typical of a failed recovery, it is not easy to make head or tail of this market. Entropy on both charts also aim at different directions.
We now have to wait for a pattern to develop, possibly a cup & handle formation. There is however no downward pressure right now, so difficult to estimate where a stronger support level will be found. At the same time, we also have to reach 150 again soon otherwise the 'failed recovery' pattern will become a more likely possibility.

Weekly: congestion - very low significance level.
This time frame has such a low significance level it is almost pointless reading it. We can only rely on the Swing indicator as well as MM and Fib levels. For the time being, it is safe to say that we are in a broad trading range with a downward bias. Failure to pass the 150 strong resistance level would become alarming if significance level wasn't so low.