Wednesday, October 31, 2007

Market Outlook RUT for Oct 31st '07


Dominant TF: Daily (and low intraday time frames)
Swings: DN-DN-UP
Market direction: congestion to mildly down.
Again, strong correlation sith SPY. Volatile environment.

60mins: congestion to mildly down.
After reaching a Fib PR2 on the up side, we are likely to go back to 812 which is also a Fib + MM level on the down side now. RUT is a little directionless ahead of the Fed announcement, but we have a negative bias so long.

Daily: Congestion - trading range.
the daily chart still points downward despite support found recently on 789. Watch for a Fib pattern forming either way, but there is a little bit more of a down bias right now. Until then, we can assume a trading range [797-828] within a larger one [781-855].

Weekly: congestion to mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with a very slight upward bias. We can note that we are again very close to a key level at this time frame with the Swing indicator oscillating frequently.

Market Outlook SPY for Oct 31st '07


Dominant TF: Daily and low intraday time frames (60mins catching up)
Swings: DN-DN-UP
Market direction: Trading range with lower bias, but check levels and new pattern forming.

Note: Swings have turned down on both 60mins and daily charts, indicating a possible key level around current prices.

60mins: congestion to down.
We could not quite gauge what would happen when SPY would hit 154.15, but in hindsight this slowdown looked normal (Fib PR2).MTFS looks congested but Entropy certainly points down, so we again have to wait a little until a clearer pattern forms. It can still be a return to highs around 157 or a test of recent lows at 149.

Daily: Congestion to mildly up but check levels carefully.
As said yesterday the daily chart still points a little downward but also seems to have acknowledged the 150 support level. The MTFS pattern is however not bullish, nor is Entropy. It is safe to say that it should remain in the 150 to 156 trading range, but we'll have to follow Fib and MM levels very carefully as a new pattern should emerge shortly (Fed announcement...)

Weekly: congestion to mildly UP - Very low significance level.
Entropy is looking OK, but for the time being MTFS indicates continuation of this situation of congestion with an upward bias.

Market Outlook NDX for Oct 31st '07


Dominant TF: Daily and 60mins (10 and 15mins too)
Swings: UP-UP-UP
Market direction: congestion.
Note: Virually no change from yesterday.NDX is still hovering around stall level, ahead of Fed rate announcement.

60mins: congestion to upward bias.No significant change.
There has been some profit taking on 2218 which is a strong resistance level in lower time frames, indicating the stall level is definitely in place. 2250 is still the target but certainly harder to reach.The market remains bullish and even if Entropy has slowed down, the target remains in sight.No visible retracement but the market has been very volatile, and may be looking for a slight lower support to bounce higher (2203?).

Daily: Congestion to Up. Slow down in overbought territory.
Same situation:NDX is overbought, and each retracement so far has failed. Entropy and MTFS are holding well, so one may just try and reach 2250 (or stay at prior stall level around current highs).

Weekly: congestion to mildly UP - Low significance level.
Entropy is looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). We therefore have 'waves in overbought zone' which may justify looking at a higher time frame. It seems we're entering a period of congestion, at least compared to the seemingly unstoppable bull run we've had. Looking at MTFS, no retracement in sight just yet.

Tuesday, October 30, 2007

Market Outlook RUT for Oct 30th '07


Dominant TF: Daily (and low intraday time frames)
Swings: UP-DN-UP
Market direction: congestion to mildly down.
Again, very strong correlation sith SPY. Volatile environment. No real change from yesterday.


60mins: congestion to mildly up.
The high volatility environment makes it sometimes difficult to gauge the amplitude of movements if direction and targets are analysed correctly. As anticipated, RUT is aiming at 828 (stronger MM + Fib), now that 812 is passed. MTFS and Entropy are looking good, yet this pattern is not indicative of a strong bull move.

Daily: Congestion - trading range.
Contrary to lower time frames, the daily chart still points downward, and this is by far the dominant time frame. Caution must be exercised as we seem to have confirmation of a support. Until a new pattern forms clearly, we can assume a trading range [797-828] within a larger one [781-855].

Weekly: congestion to mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with a very slight upward bias.We can note that we are again very close to a key level at this time frame with the Swing indicator oscillating frequently.

Market Outlook SPY for Oct 30th '07


Dominant TF: Daily and low intraday time frames (60mins catching up)
Swings: UP-UP-UP
Market direction: Probably up, but check levels and new pattern forming.
Note: No significant change from yesterday.

60mins: mildly up.
SPY reached 153 as expected, and still has some upward potential, so one could well get back to 156. 154.15 is the next Fib level, which should be passed if we consider the strong Entropy and the positive MTFS.

Daily: Congestion to mildly up but check levels carefully.
As said yesterday the daily chart still points a little downward but also seems to have acknowledged the 150 support level. The MTFS pattern is however not bullish, nor is Entropy. It is safe to say that it should remain in the 150 to 156 trading range, but we'll have to follow Fib and MM levels very carefully as a new pattern should emerge shortly (Fed announcement...)

Weekly: congestion to mildly UP - Very low significance level.
Entropy is looking OK, but for the time being MTFS indicates continuation of this situation of congestion with an upward bias.

Market Outlook NDX for Oct 30th '07


Dominant TF: Daily and 60mins (10 and 15mins too)
Swings: UP-UP-UP
Market direction: congestion.

Note: Virually no change from yesterday.
NDX is still hovering around stall level, ahead of Fed rate announcement.

60mins: congestion to upward bias.
Same situation: The market is both resilient and very volatile. Lower time frames seem to point slightly upward in the same trading range. We reached the high end of that range, which is also bumping on 'stall' level. Since there is still an upward bias, we'll have to watch this level carefully. If this level is passed, NDX will obviously aim for 2250.Note that the MTFS pattern isn't clear, with the white line below the other lines and not even trying to catch up. Entropy is too high to see NDX peaking yet, but we'll have to watch its behaviour carefully (Fed??).
Daily: Congestion to Up. Slow down in overbought territory.
Same situation:NDX is overbought, and each retracement so far has failed. Entropy and MTFS are holding very well, so one may just try and reach 2250 (or stay at prior stall level around current highs).

Weekly: congestion to mildly UP - Low significance level.
Entropy is looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). We therefore have 'waves in overbought zone' which may justify looking at a higher time frame. It seems we're entering a period of congestion, at least compared to the seemingly unstoppable bull run we've had. Looking at MTFS, no retracement in sight until it peaks.

Saturday, October 27, 2007

Market Outlook RUT for Oct 29th '07


Dominant TF: Daily (and low intraday time frames)
Swings: UP-DN-DN
Market direction: congestion to mildly down.

Again, very strong correlation sith SPY. Volatile environment.

60mins: congestion to mildly up.
The high volatility environment makes it sometimes difficult to gauge the amplitude of movements if direction and targets are analysed correctly. As anticipated, RUT is aiming at 828 (stronger MM + Fib), now that 812 is passed. MTFS and Entropy are looking good, yet this pattern is not indicative of a strong bull move.

Daily: Congestion to down.
Despite Friday's strong up move, there is no change in our analysis: Contrary to lower time frames, the daily chart still points downward, and this is by far the dominant time frame. Caution must be exercised, until Fib and MM give us indication of support. Until then: trading range with a downward bias. Support on Fib and MM levels (cf chart) seems to hold though, so one must follow the formation of a Fib pattern accordingly.

Weekly: congestion to mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with a very slight upward bias. The bar has turned red.

Market Outlook NDX for Oct 29th '07


Dominant TF: Daily and 60mins (10 and 15mins too)
Swings: UP-UP-UP
Market direction: congestion.

Note: Swings are back UP, but this indicates we are close to a key level. Thursday's Down indication could very well be a warning, as the Swing indicator is very reactive. The market is so overbought that a correction would be healthy, yet one should avoid any wishful thinking as it is not visible on the charts just yet.

60mins: congestion to upward bias.
The market is both resilient and very volatile. Lower time frames seem to point slightly upward in the same trading range. We reached the high end of that range, which is also bumping on 'stall' level. Since there is still an upward bias, we'll have to watch this level carefully. If this level is passed, NDX will obviously aim for 2250.
Daily: Congestion to Up. Slow down in overbought territory.NDX is overbought, and each retracement so far has failed. Entropy and MTFS are holding very well, so one may just try and reach 2250 (or stay at prior stall level around current highs).

Weekly: congestion to mildly UP - Low significance level.
Entropy is looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). We therefore have 'waves in overbought zone' which may justify looking at a higher time frame. It seems we're entering a period of congestion, at least compared to the seemingly unstoppable bull run we've had. Looking at MTFS, no retracement in sight until it peaks.

Market Outlook SPY for Oct 29th '07


Dominant TF: Daily and low intraday time frames
Swings: UP-DN-UP
Market direction: Probably up if support is confirmed.
60mins: up.
SPY reached 153 as expected, and still has some upward potential, so one could well get back to 156. 154.15 is the next Fib level, which should be passed if we consider the strong Entropy and the positive MTFS.

Daily: Congestion to down. Check levels carefully.
Contrary to lower time frames, the daily chart still points downward but also seems to acknowledge the 150 support level. The MTFS pattern is however not bullish, nor is Entropy. There is therefore no reason yet to believe it will go much higher.

Weekly: congestion to mildly UP - Very low significance level.
Entropy is looking OK, but MTFS indicates continuation of this situation of congestion with an upward bias.

Friday, October 26, 2007

Market Outlook RUT for Oct 26th '07


Dominant TF: Daily (and low intraday time frames)
Swings: UP-DN-DN
Market direction: congestion to mildly down.

Again, very strong correlation sith SPY. Volatile environment.

60mins: congestion to mildly up. pivot level at 812. Low significance level.
Lower time frames indicate still some slight upward bias to 812, 820, and possibly 828(stronger MM + Fib), but current pivot level (812) is still very much valid. MTFS is a little hesitant and Entropy is fading fast.

Daily: Congestion to down.
Contrary to lower time frames, the daily chart still points downward, and this is by far the dominant time frame. Caution must be exercised, until Fib and MM give us indication of support. Until then: trading range with a downward bias. Support on Fib and MM levels (cf chart) should hold as long as Entropy does not fall...

Weekly: mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with an upward bias.

Market Outlook SPY for Oct 26th '07


Dominant TF: Daily and low intraday time frames
Swings: UP-DN-UP
Market direction: congestion to mildly up if support is confirmed.

60mins: mildly up.
Lower time frames indicate some upward bias, and SPY could well reach Fib PR1 or even 153 (MM+ Fib). MTFS is not looking too bad but Entropy could peak shortly. Significance level is very low.

Daily: Congestion to down. Check levels carefully.
Contrary to lower time frames, the daily chart still points downward, and this is the dominant time frame. One may have some congestion since we have Fib + MM level at 150. Caution must be exercised, at least until a new Fib formation appears clearly.For the time being, a strong base for support must be found to reassure the market. 150 is holding well overall for the time being, and low intraday time frames are in a cycle with some upward momentum indicating difficulties going higher. Check PR1 and pivot level on 60 mins chart to possibly release energy on the upside.

Weekly: mildly UP - Very low significance level.
Entropy is looking OK, but MTFS indicates continuation of this situation of congestion. The Swing indicator is very undecisive, so one may just be close to a key level.

Market Outlook NDX for Oct 26th '07


Dominant TF: Daily and 60mins (10 and 15mins too)
Swings: DN-DN-UP
Market direction: congestion.

Volatility is very high, possibly confirming our earlier diagnostic that we may be close to a key level. The market is so overbought that a correction would be healthy. We have to note that the swing indicator has turned down for both dominant time frames.

60mins: congestion.
The market is both resilient and very volatile. Lower time frames seem to point slightly upward in the same trading range. The 10mins chart show vergy good looking cycles. The up potential is however limited.It is too early to project Fib expansion patterns, but we would like to make some sense of the current congestion. The trading range is a little narrower, between 2156 and 2188.

Daily: Congestion to Up. Slow down in overbought territory.
NDX is overbought, and each retracement so far has failed. Entropy is however declining, so one may just try and reach 2250 (or stay at prior stall level around current highs). MTFS green line holding well, so even if a strong retracement is expected it is nowehere visible in our indicators right now.
Weekly: congestion to mildly UP - Low significance level.
Entropy is looking good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). We therefore have 'waves in overbought zone' which may justify looking at a higher time frame. It seems we're entering a period of congestion.

Thursday, October 25, 2007

Market Outlook RUT for Oct 25th '07


Dominant TF: Daily (also weekly to an extent)
Swings: UP-DN-DN
Market direction: congestion to mildly down.

60mins: congestion to mildly up. pivot level at 812.
Lower time frames indicate still some slight upward bias to 820, and RUT could also reach 828(stronger MM + Fib), but current pivot level (812) is still very much valid. MTFS is a little hesitant and Entropy is fading fast.

Daily: Congestion to down.
Contrary to lower time frames, the daily chart still points downward, and this is by far the dominant time frame. Caution must be exercised, until Fib and MM give us indication of support. Until then: trading range with a downward bias.

Weekly: mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with an upward bias.

Market Outlook SPY for Oct 25th '07


Dominant TF: Daily and low intraday time frames
Swings: UP-DN-UP
Market direction: congestion

60mins: mildly up.
Lower time frames indicate some slight upward bias, and SPY could well reach Fib PR1 or even 153 (MM+ Fib). MTFS is not looking too bad but Entropy could peak shortly. Significance level is lower
Daily: Congestion to down.
Contrary to lower time frames, the daily chart still points downward, and this is the dominant time frame. One may have some congestion since we have Fib + MM level at 150. Caution must be exercised, at least until a new Fib formation appears clearly.
For the time being, lows are lower, and a strong base for support must be found to reassure the market. 150 is holding overall for the time being, but this high volatility environment can cause this level to be broken at least momentarily.
Weekly: mildly UP - Very low significance level.
Entropy is looking OK, but MTFS indicates continuation of this situation of congestion. The Swing indicator is very undecisive, so one may just be close to a key level.

Market Outlook NDX for Oct 25th '07



Dominant TF: Daily and 60mins (10 and 15mins too)
Swings: UP-UP-UP
Market direction: mildly up.

Volatility is very high, possibly confirming our earlier diagnostic that we may be close to a key level. The market is so overbought that a correction would be healthy.

60mins: congestion to mildly up.
Major swings yesterday to return to more or less the same pivot level (2188). The market is quite resilient, for many reasons (exchange rate, world economic growth, bond market, real estate etc). Yet this does not appear to be stable over the medium term.
It is too early to project Fib expansion patterns, but we would like to make some sense of the current wide range congestion. There is still an upward bias, so there should be again some excursion above 2188, but we'll have to watch lower time frames for guidance, where a resistance level at 2219 is given.

Daily: Up, hopefully at a slower pace.
NDX is overbought, and each retracement so far has failed. Entropy is however declining, so one may just try and reach 2250 (or prior stall level around current highs). MTFS green line holding well, so even if a retracement is expected it is nowehere visible in our indicators right now.

Weekly: congestion to mildly UP - Low significance level.
Entropy is looking good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). We therefore have 'waves in overbought zone' which may justify looking at a higher time frame.

Wednesday, October 24, 2007

Market Outlook RUT for Oct 24th '07


Dominant TF: Daily (also weekly to an extent)
Swings: UP-DN-DN
Market direction: congestion to mildly down.

60mins: mildly up.
Lower time frames indicate still some slight upward bias to 820, but RUT could also reach 828(stronger MM + Fib). MTFS is not looking too bad but Entropy has peaked already. Significance level is now much lower.

Daily: Congestion to down.
Despite yesterday's up day, and contrary to lower time frames, the daily chart still points downward, and this is the dominant time frame. One may have some congestion since we have Fib + MM level at 812. Caution must be exercised, at least until a new Fib formation appears clearly. In such case, one may see a target more clearly (781?? or 862??).

Weekly: mildly UP
Entropy is looking good, but MTFS indicates continuation of this situation of congestion with an upward bias.

Market Outlook SPY for Oct 24th '07


Dominant TF: Daily
Swings: UP-DN-DN
Market direction: congestion.

60mins: mildly up.
Lower time frames indicate some slight upward bias, and SPY could well reach Fib PR1 or even 153 (MM+ Fib). MTFS is not looking too bad but Entropy could peak shortly. Significance level is lower.

Daily: Congestion to down.
Despite yesterday's up day, and contrary to lower time frames, the daily chart still points downward, and this is the dominant time frame. One may have some congestion since we have Fib + MM level at 150. Caution must be exercised, at least until a new Fib formation appears clearly.

Weekly: mildly UP - Very low significance level.
Entropy is looking good, but MTFS indicates continuation of this situation of congestion. The Swing indicator is trying to turn down, so one may just be close to a key level.

Market Outlook NDX for Oct 24th '07


Dominant TF: Daily and 60mins
Swings: UP-UP-UP
Market direction: mildly up.
60mins: up.
The method cannot detect sudden shocks to the system, but can adapt to them and evaluate subsequent directions and levels. In this case, after an 'exuberant' open, NDX broke pivot level and went up to 2188, but to our surprise, that level also broke fairly easily. MTFS and Entropy are bullish, so the next resistance level may just be 2250. We'll have to watch for the 'stall' level if prices move to fast (~2134).No visible Fib pattern to provide any other scenario at the moment.

Daily: Up, hopefully at a slower pace.
Amazing bounce on 2125. NDX is overbought, and each retracement so far has failed. Entropy is however declining, so one may just try and reach 2250 (or prior stall level).

Weekly: mildly UP - Low significance level.
Entropy is looking good, but MTFS has difficulty adapting to such a strong run. We therefore have 'waves in overbought zone' which may justify looking at a higher time frame.

Tuesday, October 23, 2007

Market Outlook RUT for Oct 23rd '07


Dominant TF: 60 mins & Daily (15mins time frames too).
Swings: DN-DN-UP
Market direction: congestion to down initially.

Detailed chart interpretation: Strong correlation with SPY therefore market interpretation is also very similar hence no need to virtually copy/paste whole commentary (see post below: http://marketsnapshot.blogspot.com/2007/10/market-outlook-spy-for-oct-23rd-07.html )

Support level has been found around 794 for now, but 781 is probably stronger.

Market Outlook SPY for Oct 23rd '07


Dominant TF: Daily and 60mins
Swings: DN-DN-UP
Market direction: Congestion to Down. Support should be found soon.

60mins: Congestion to down.
There is no indication that yesterday's recovery will take SPY much higher in the short term. A congestion is likely.MTFS had an early crossover which is generally not indicative of a strong recovery, but the lines gradients are now looking better. We shall however watch how negative entropy is dissipating over the next few bars.

Daily: Profit taking until support is found (150 or lower...)
The 150 support level proved strong enough to stop the fall, but MTFS looks bearish, and bars are also decidedly red. The correction is maybe not over yet, and we have to possibly watch lower Fib retracement levels.

Weekly: Congestion, but caution: significance level is ridiculously low.
For the time being, indicators still point very slightly upward, but the red bar is more reactive and negates any remaining positive momentum in the short term. We can see some divergence in AdStoK and a very low significance level at this time frame (divergence?), so this is at best only a background information at the moment, and one should certainly focus on lower time frames (60mins and daily).

Market Outlook NDX for Oct 23rd '07


Dominant TF: Daily and 60mins
Swings: UP-UP-UP
Market direction: Congestion to mildly up.

60mins: Congestion. Mild updward bias at first.
Good recovery after hitting the 2125 support level very strongly. The level held and prices bounced to pivot level (MM + Fib). MTFS is undecisive, and Entropy is recovery, indicating an upward bias, however possibly bumping on pivot level.It is therefore not easy to see price behaviour going forward, and lower time frames do not provide more information at present. Bar colours have not even turned blue during this recovery.

Daily: Congestion to down.
A red bar, yet a very bullish bar, other indicators still eroding: we are in presence of indetermination, so we hae to be very careful and watch salient levels to gauge for future direction, particularly on the 60 mins chart. If the 2088 level fails to be broken, bulls may just give up...

Weekly: Congestion to mildly UP - Low significance level.
Current congestion in lower time frames can slow down or stall the upward bias we still have.Note that significance level on this time frame is falling, due to indicator divergence.

Monday, October 22, 2007

Market Outlook RUT for Oct 22nd '07


Dominant TF: 60 mins & Daily (15mins time frames too).
Swings: DN-DN-DN
Market direction: congestion to down initially. No panic just yet, as a support will probably be found soon.

It is relatively difficult to comment this market correctly as one could be tempted to join the new bear wave and announce the apocalypse. The truth is that this correction was expected and probably also healthy. There is no indication that it will go much lower as the daily chart may find a support soon, hence bounce and stay relatively bullish overall.

Detailed chart interpretation: Strong correlation with SPY so, interpretation also very similar hence no need to virtually copy/paste whole commentary (see post below: http://marketsnapshot.blogspot.com/2007/10/market-outlook-spy-for-oct-22nd-07.html)

Support level to be found around 794 or 781. Very negative bias at first.

Market Outlook SPY for Oct 22nd '07


Dominant TF: Daily and 60mins
Swings: DN-DN-UP
Market direction: Congestion to Down. Support should be found soon.

It is relatively difficult to comment this market correctly as one could be tempted to join the new bear wave and announce the apocalypse. The truth is that this correction was expected and probably also healthy. There is no indication that it will go much lower as the daily chart may find a support soon, hence bounce and stay relatively bullish overall.
60mins: Congestion to down.
Although we saw it coming, we certainly got a little caught by this draft. Low time frames are still very bearish indicating it will be difficult to gauge whether 150 where SPY closed will hold. MTFS does not give us the indication of a bottom in the short tern, so it is indeed very possible to see a lower open even if 150 holds overall.

Daily: Profit taking until support is found (150 or lower...)
Profit taking accelerated and we admittedly underestimated the impact of the high volatility environment we've had in the last few months.At this point, 150 should hold, but we'll have to watch lower Fib levels too. MTFS has its green line with a steper gradient indicating the correction could indeed gather momentum. One should however not jump into conclusions: this is still nothing more than a normal correction.

Weekly: Congestion to mildly up, but caution: significance level is ridiculously low.
The Swing indicator is up, but the key swing price level is still close at this time frame, so the indicator could turn around again. For the time being, everything still points (at least mildly) upward. We can however see some divergence in AdStoK and a very low significance level at this time frame (divergence?), so this is at best only a background information at the moment, and one should certainly focus on lower time frames (60mins and daily).

Saturday, October 20, 2007

Market Outlook NDX for Oct 22nd '07


Dominant TF: Daily and low time frames (15mins)Swings: DN-DN-UPMarket direction: Down but until support is found.
We have warned of a pending correction since last week, even if we could not pinpoint exactly when it would happen. The market entered a clearly defined [2156-2188] trading range, bumped on the high end (so called 'stall' level identified on Oct 11th) then reversed sharply.
60mins: Down.Despite we saw it coming, the strength of the correction still suprised us. Having said that is has been commensurate with the exuberance of the market in the last few months.The bottom has not been found yet. The 2125 MM level will be tested immediately, but support will have to be found lower, possibly 2117 or ... 2090!

Daily: Congestion to down.
Despite Friday's correction, we still have a blue bar, and MTFS and Entropy while weaker do not indicate a market crash going forward. If the 2125 level is broken, we'll watch the next Fib retracement levels with more attention. A market correction is obviously possible, yet one should not jump to conclusions as we do not have signs of a reversal situation. It is only a high-volatility yet normal profit taking pattern, at least for now.

Weekly: Congestion to mildly UP - Low significance level.
Current congestion in lower time frames can slow down or stall the upward bias we still have.Note that significance level on this time frame is falling, due to indicator divergence.

Friday, October 19, 2007

Market Outlook RUT for Oct 19th '07


Dominant TF: 60 mins & Daily (15mins time frames too). Weekly influence declining.
Swings: UP-DN-UP
Market direction: congestion to down initially. Overall trend is still up, but support must be found first.

60mins: Congestion to mildly down, but probably at a slow pace.

We've had a bit of a bounce, which could technically reach PR1 close to 830, but MTFS (AdStoK) is giving a pattern that is more indicative of a trading range so it may not get there any time soon.
On the down side, the same support levels are valid: 820 then 813 later on.

Daily: Down, til support is found.
No new information:
MTFS (formerly AdStoK) is weaker, lines have crossed, bars are red, all indicating a definite slowdown. We could certainly look for support between 808 (Fib) and 812 (MM) in the next few days.
The high volatility environment seems to accelerate movements in either direction, however Entropy is still fairly high so this down move should be fairly controlled. No reason just yet to believe it will go lower than pivot level.

Weekly: mildly up until...
Significance level is lower, but the overall "U shape" MTFS pattern is still there, and strong MM resistance remains 875.
One must check significance level (divergence) which could invalidate the pattern. Lower time frames will soon provide us with clues (support level and return to the dominant trend).

Market Outlook SPY for Oct 19th '07

Dominant TF: Daily and 60mins Swings: UP-DN-UP Market direction: Congestion. Upward bias still valid overall despite some profit taking.
60mins: Congestion to mildly down. Erosion of SPY should continue. The 153.13 pivot level was tested, and will be tested again. Congestion or a shallow bounce on 153 is a likely scenario at first.
Daily: Profit taking until support is found (150??) AdStoK is so overbought with a white line declining, bars turning red and Entropy losing steam: SPY can only go lower. This is however not indicative of any strong retracement in the near term, so profit taking should continue at a slow pace, possibly to the 150 MM + Fib level.
Weekly: mildly UP, but caution: significance level is ridiculously low. The Swing indicator is up, but the key swing price level is still close at this time frame, so the indicator could turn around again. For the time being, everything points upward. We can however see some divergence in AdStoK and a very low significance level at this time frame (divergence?), so this is at best only a background information at the moment, and one should certainly focus on lower time frames (60mins and daily).

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Here also is a commented audio soundtrack (8m25s) to complement this SPY chart. The purpose is to teach traders how simple it can be to read charts using this TradeStation technique. Please note that these indicators can be used unchanged on various symbols and time frames.
The technique was designed to remain as simple as possible so that decision making remains quick and as unambiguous as possible. It must also be noted that all indicators feed an API allowing developers to build their own rule set to contribute to even easier decision making.

Market Outlook NDX for Oct 19th '07


Dominant TF: Daily and low time frames (15mins)
Swings: UP-UP-UP
Market direction: Probable Congestion. Watch 2188 key level, particularly on 15mins chart, for clues on forthcoming direction.

Note: A variation to the MTFS (or AdStoK) white line is plotted (test). It provides a slightly higher memory effect in the indicator.

60mins: Congestion with some remaining upward bias.

As said yesterday, we've had a continuation of the upward bias within a [2156-2188] trading range, and we now reached the high end of that range. The pattern is completed and it is more difficult to gauge what is coming next. Behaviour around this level will determine forthcoming direction, and lower time frames do provide higher significance level and trading opportunities.

Daily: Congestion - Upward bias is still technically there but NDX is very overbought, so lower time frames must be watched carefully.
No new information:
MTFS and Entropy are now showing more signs of weakness. There is however still substantial accumulated energy in Entropy that one cannot imagine a serious retracement right now, but one could certainly have a pause with some congestion and profit taking (same [2150-2200]range).
One cannot discard a development of a new pattern which in this high volatility environment could take just a few days to materialize.
Note: the new MTFS (AdStoK) White Line variation is higher, hence down-plays the effect of the current profit taking event.

Weekly: Mildly UP until resistance is found

Current congestion in lower time frames can slow down or stall the upward bias we still have.
Note that significance level on this time frame is falling, due to indicator divergence.

Thursday, October 18, 2007

Market Outlook RUT for Oct 18th '07


Dominant TF: 60 mins & Daily (low intraday time frames too). Weekly influence declining.
Swings: DN-DN-UP
Market direction: congestion to down initially. Overall trend is still up, but support must be found first.

60mins: Congestion to down, but probably at a slow pace.

It is interesting to see that the 828 pivot level is now a new lower resistance level. AdStoK and Entropy point lower toward support levels around 820 first, but much stronger at 813. Significance level is high so we probably just have to follow the trend until AdStoK lines cross.
Lower time frames do indicate new testing of 828 at first though

Daily: Congestion to down at first. Overall direction unchanged yet but new support will have to be found.
No new information:

AdStoK is weaker and lines are crossing, indicating a definite slowdown. The red bar confirms also the diagnostic. We could certainly look for support between 808 (Fib) and 812 (MM) in the next few days.
The high volatility environment seems to accelerate movements in either direction, however Entropy is still fairly high so this down move should be fairly controlled. No reason just yet to believe it will go lower than pivot level.

Weekly: mildly up until...
It was clear RUT would hit 851 (highs + Fib) but what is now coming next? AdStoK and Entropy do not point lower, so one should not panic just yet. RUT is likely to hold or even possibly go higher. Strong MM resistance is still 875.

Market Outlook SPY for Oct 18th '07


Dominant TF: Daily (and 15mins)
Swings: UP-DN-UP
Market direction: Congestion. Upward bias still valid overall despite some profit taking.

60mins: Congestion to mildly down.

Erosion of SPY should continue, until support is truly found, first at 153.13, but possibly lower. Since the gradient is moderate, 153 is indeed more likely than 150 which seems much stronger though.
Note that lower time frames have high significance level and indicate an upward bias at first. Check 1562 as quite a strong resistance level on ES futures.

Daily: Profit taking until support is found.
AdStoK is so overbought with a white line declining, bars turning red, but Entropy is still holding fairly well. This is not indicative of any strong retracement in the near term, so profit taking should continue at a slow pace, possibly to 150 which would be tested for support and is a Fib PR1 level.

Weekly: mildly UP.
The Swing indicator is up, but the key swing price level is still close at this time frame, so the indicator could turn around again. For the time being, everything points upward. We can however see some divergence in AdStoK and a very low significance level at this time frame (divergence?), so this is at best only a background information at the moment, and one should certainly focus on lower time frames (15mins and daily).

Market Outlook NDX for Oct 18th '07


Dominant TF: Daily and low time frames (15mins)
Swings: UP-UP-UP
Market direction: Congestion but upward bias still valid (Daily).

Note: A variation to the AdStoK white line is plotted (test). It provide a slightly higher memory effect in the indicator.

60mins: Congestion with an upward bias.

The same trading range is expected. Congestion is expressed with relation to the high volatility environment we have had for a few weeks.
The market may try and test 2187 again. It has been the stall level after the strong bull run we had for a couple of months, and constitutes a test level.

Levels to watch: 2188 pivot level at this time frame, but lower time frames do provide MUCH higher significance level and trading opportunities.

Daily: Congestion - Upward bias is still technically there but NDX is very overbought, so lower time frames must be watched carefully.
No new information:
AdStoK and Entropy are now showing more signs of weakness. There is however substantial accumulated energy in Entropy that one cannot imagine a serious retracement right now, but one could certainly have a pause with some congestion and profit taking. This high volatility environment can also obviously accelerate movements in either direction, but that would take a few days to materialize.
Note: the new AdStoK White Line variation is higher, hence down-plays the effect of the current profit taking event.

Weekly: Mildly UP until resistance is found
Current congestion in lower time frames can slow down or stall the upward bias we still have.
Note that significance level on this time frame is falling, due to indicator divergence.

Wednesday, October 17, 2007

Market Outlook RUT for Oct 17th '07


Dominant TF: Daily & Weekly
Swings: DN-UP-UP
Market direction: congestion to down initially. Overall trend is still up, but support must be found first.

60mins: Congestion to down, but probably at a slow pace.

It is interesting to see that the 828 pivot level may turn soon into a resistance level. AdStoK and Entropy certainly point lower, so we should maybe look for a lower support level, 820 first, but much stronger at 813.

Daily: Congestion to down at first. Overall direction unchanged yet but new support will have to be found.
No new information:
AdStoK is weaker and lines are crossing, indicating a definite slowdown. The red bar confirms also the diagnostic. We could certainly look for support between 808 (Fib) and 812 (MM) in the next few days.
The high volatility environment seems to accelerate movements in either direction, however Entropy is still fairly high so this down move should be fairly controlled. No reason just yet to believe it will go lower than those levels unless some economic news shock the system of course.

Weekly: mildly up until...
It was clear RUT would hit 851 (highs + Fib) but what is now coming next? AdStoK and Entropy do not point lower, so one should not panic just yet. RUT is likely to hold or even possibly go higher. Strong MM resistance is still 875.

Market Outlook SPY for Oct 17th '07


Dominant TF: Daily (and 15mins)
Swings: DN-DN-UP
Market direction: Congestion. Upward bias still valid overall despite some profit taking.

60mins: Congestion to mildly down.

Erosion of SPY should continue, until support is truly found, first at 153.13, but possibly lower. Since the gradient is moderate, 153 is indeed more likely than 150 which seems much stronger though.

Daily: Profit taking until support is found.

AdStoK is so overbought with a white line declining, bars turning red, but Entropy is still holding fairly well. This is not indicative of any strong retracement in the near term, so profit taking should continue at a slow pace, possibly to 150 which would be tested for support and is a Fib PR1 level.

Weekly: mildly UP.
The Swing indicator is up, but the key swing price level is still close at this time frame, so the indicator could turn around again. For the time being, everything points upward. We can however see some divergence in AdStoK and a very low significance level at this time frame, so this is only background information at the moment, and one should focus on lower time frames (15mins and daily).

Market Outlook NDX for Oct 17th '07


Dominant TF: Daily and low time frames (15mins)
Swings: DN-UP-UP
Market direction: Congestion but upward bias still valid (Daily).


Note: A variation to the AdStoK white line is plotted (test). It provide a slightly higher memory effect in the indicator.

60mins: Congestion with a down bias.
No new information yesterday. The same trading range is expected.

Levels to watch: around 2120 (Fib at 2117 and MM at 2125). 2156 is pivot in lower time frames.


Daily: Congestion - Upward bias is still technically there but NDX is very overbought, so lower time frames must be watched carefully.
No new information:
AdStoK and Entropy are now showing some early signs of weakness, the bar has turned red and significance level is still the highest of all 3 on this chart.
There is however so much accumulated energy (in Entropy) that one cannot imagine a serious retracement right now, but one could certainly have a pause with some congestion and profit taking. This high volatility environment can also obviously accelerate movements in either direction, but that would take a few days to materialize.
Note: the new AdStoK White Line variation is higher, hence down-plays the effect of the current profit taking event.

Weekly: Mildly UP until resistance is found
Current congestion in lower time frames can slow down or stall the upward bias we still have.
Note that significance level on this time frame is falling, due to indicator divergence.

Tuesday, October 16, 2007

Market Outlook RUT for Oct 16th '07


Dominant TF: Daily & Weekly
Swings: DN-UP-UP
Market direction: congestion, possibly mildly Up after support level is found.

60mins: Down, or a bit of roller-coaster at best.

We undoubtedly saw it coming from a distance and the situation is about the same as for SPY, except maybe that we are on stronger support or pivot levels. AdStoK and Entropy certainly point lower, so we should maybe look for a lower support level.

Daily: Congestion to down at first. Overall direction unchanged yet but new support will have to be found.
AdStoK is weaker and lines are crossing, indicating a definite slowdown. The red bar confirms also the diagnostic. We could certainly look for support between 808 (Fib) and 812 (MM) in the next few days.
The high volatility environment seems to accelerate movements in either direction, however Entropy is still fairly high so this down move should be fairly controlled. No reason just yet to believe it will go lower than those levels... unless some economic news shock the system of course.

Weekly: mildly up until...
It was clear RUT would hit 851 (highs + Fib) but what is now coming next? AdStoK and Entropy do not point lower, so one should not panic just yet. RUT is likely to hold or even possibly go higher. Strong MM resistance is still 875.

Market Outlook SPY for Oct 16th '07


Dominant TF: Daily (and 15mins)
Swings: DN-UP-UP
Market direction: Congestion. Upward bias still valid overall despite some profit taking.

60mins: Congestion to mildly down.

Our word of warning proved to be correct. As for NDX, we clearly had a classic pattern forming. Now, what's next?
The late recovery cames mostly from day traders squaring off positions on day close, but SPX should go lower. Watch 153.4 (Fib) or even 153.1 (MM) in the near term, as it is likely that AdStoK lines will now go lower to cross in oversold territory.


Daily: Profit taking, but not change in overall direction yet.

AdStoK is so overbought with a white line declining, but Entropy is still holding fairly well. This is not indicative of any strong retracement in the near term.
We however now have a red bar, so profit taking could continue at a slow pace, possibly to 150 which would be tested for support and is a Fib PR1 level.
It is certainly too early right now, but one should keep it in mind.

Weekly: mildly UP.
The Swing indicator is now more firmly up, but the key swing price level is still close at this time frame.
Entropy is also looking better and the trend should remain mildly up for the time being as AdStoK lines are close to crossing with a strong up gradient.
We can however see some divergence in AdStoK and a low significance level at this time frame, so this is only background information at the moment, and one should focus on lower time frames (15mins and daily).

Market Outlook NDX for Oct 16th '07


Dominant TF: Daily and low time frames (15mins)
Swings: DN-UP-UP
Market direction: Congestion - Up bias still valid.

60mins: 2156 is pivot level. NDX should go slightly lower.

Couldn't have been more right yesterday. We were in presence of a classic pattern, which turned into a textbook Fib expansion to 2143. As the pattern is now complete, we only have a few clues about what is coming next. A negative bias is still in the market, but energy is not high enough to carry NDX much lower right now.
Levels to watch: around 2120 (Fib at 2117 and MM at 2125). 2156 is pivot in lower time frames, so one may also see some seemingly congestion at this time frame while lower time frames test this level up or down.
The 15mins chart is the most significant right now.


Daily: Up until...
AdStoK and Entropy are now showing some early signs of weakness and significance level is still the highest of all 3 on this chart.
There is however so much accumulated energy (in Entropy) that one cannot imagine a serious retracement right now, but one could certainly have a pause with some congestion and profit taking. This high volatility environment can also obviously accelerate movements in either direction, but that would take a few days to materialize.
For the time being, i would recommend keeping an eye on the formation of a clearer pattern (H&S, DT, or breakout) in intraday time frames.


Weekly: Mildly UP until resistance is found
AdStoK lines have now crossed over so NDX may be a little ahead of itself, but significance level is so low at this time frame (divergence) that we should not jump to conclusions.
A crossover is very often a decision point, but we shall draw more information from lower time frames for now.

Monday, October 15, 2007

Market Outlook RUT for Oct 15th '07


Dominant TF: Daily & Weekly
Swings: DN-UP-UP
Market direction: congestion, possibly mildly Up

60mins: a bit of roller-coaster... or congestion with price erosion.

We here have the same indecision as for SPY, however with a lower entropy.
The 843 resistance level may prove to hard to break, which would trigger a new test of recent lows (831). One may just as well stay in a trading range [836-843].

The same caution expressed last Friday still applies going forward: One must watch the coming trading range very closely as it could form an interesting pattern (head and shoulder? double top?). Too early to say, so reading too much between the (AdStoK) lines could lead to unfounded speculation.

Daily: Congestion to mildly up.
AdStoK is very overbought and is now showing some weakness. The white line crossover will give us interesting information shortly. Entropy is lower and the dialy bar has turned yellow.
There is no reason to panic just yet, but the slowdown should soon be confirmed.
Current resistance level at 843 is fairly strong then 860 and ultimately 875.
Support: 828 (likely), then 812 (unlikely in the short term).

Weekly: mildly up until...
It was clear RUT would hit 851 (highs + Fib) but what is now coming next? AdStoK and Entropy do not point lower, so one should not panic just yet. RUT is likely to hold or even go higher. Strong MM resistance is still 875.

Market Outlook SPY for Oct 15th '07


Dominant TF: Daily
Swings: UP-UP-UP
Market direction: Congestion. Upward bias still valid.

60mins: Possible congestion with upward bias. 156.25 is a pivot level to watch in the near term.

This AdStoK pattern is not the easiest to read, as we have really no energy left right now (non existent Entropy), so it may require a bit of a 'shock' to move either way. A trading range [154.60-158-50] is likely for the time being.

Daily: mildly up.
AdStoK is so overbought with a white line declining, but Entropy is still holding quite well. This is not indicative of any strong retracement in the near term.
We could however have some increased volatility in the next few days, and a direction then emerging more clearly. Until then the upward bias is still valid.

Weekly: mildly UP.
The Swing indicator is now more firmly up, but the key swing price level is still close at this time frame.
Entropy is slowly looking better, and the trend should remain mildly up for the time being as AdStoK lines are now crossing with a strong up gradient.

Saturday, October 13, 2007

Market Outlook NDX for Oct 15th '07


Dominant TF: Daily and low time frames (15mins)
Swings: UP-UP-UP
Market direction: Watch behaviour on stall level.

60mins: Up, but resistance at 2188 to be watched closely. Follow lower time frames for guidance.

One should not forget Thursday's incident too quickly, as it may have been costly to some. There could well be more turbulences ahead.
For the time being, NDX will try and hit 2188 again, and we'll have to be very careful as it can turn into a head & shoulder, a double top, or obviously break on the up side.
Entropy is recovering a bit, but lower time frames (not displayed here) are far more hesitant. We are close to a stall level at 2180, applicable to this sudden recovery.

Daily: Up until...
AdStoK is now showing more signs of weakness and significance level is still the highest of all 3 on this chart.
There is so much accumulated energy that one cannot imagine a serious retracement right now, but one could have a pause with some congestion and profit taking. This high volatility environment can obviously accelerate movements in either direction. For the time being, i would recommend keeping an eye on the formation of a clearer pattern (H&S, DT, or breakout) in intraday time frames.

Weekly: Mildly UP until resistance is found
AdStoK lines have now crossed over so RUT may be a little ahead of itself, but significance level is so low at this time frame (divergence) that we should not jump to conclusions. It is almost unthinkable to have a retracement with an rising Entropy.

Friday, October 12, 2007

Market Outlook RUT for Oct 12th '07


Dominant TF: Weekly & Daily, lower time frames joining the party
Swings: DN-UP-UP
Market direction: congestion, possibly mildly Up

60mins: a bit of roller-coaster.

As said for NDX and SPY, this little hiccup was expected a little later, but NDX's madness triggered some selling on stall level, bringing the whole market down.
RUT could test 828 for support first, and 843 is a new resistance which will be harder to break.
One must watch the coming trading range very closely as it could form an interesting pattern (head and shoulder? double top? no panic just yet...)
Note: The gradient of the AdStoK green line should also give us information on whether we're heading for a turnaround or a V shape pattern.

Daily: Congestion to mildly up.
AdStoK is very overbought and is now showing some weakness. The white line crossover will give us interesting information shortly. Entropy is lower but there is no reason to panic: the trend is still UP! Yesterday's down day did not even change the colour of the daily bar, which is still blue.
Current resistance level at 843 is fairly strong then 860 and ultimately 875.
Support: 828 (likely), then 812 (unlikely in the short term).

Weekly: mildly up until...

It was clear RUT would hit 851 (highs + Fib) but what is now coming next? AdStoK and Entropy do not point lower, so one should not panic just yet. RUT is likely to hold or even go higher. Strong MM resistance is still 875.

Market Outlook SPY for Oct 12th '07


Dominant TF: Daily
Swings: DN-UP-UP
Market direction: Congestion. Upward bias still valid.

60mins: Testing support on 154.65. Possible congestion.

It seems that NDX's madness triggered that profit taking on stall level. SPY is also teetering with all time highs so was also subject to profit taking.
Lower time frames seem to confirm that 154.65 has to be tested (MM + Fib). It is too early to anticipate contagion and broad selling pressure.
Entropy is however quite low, so one may enter a trading range [154.50-156-50] for the time being.
Should 154.65 break, the next Fib levels coincide with MM levels: 154, then stronger on 153.15

Daily: congestion to mildly UP.
AdStoK is so overbought that this little hiccup of yesterday had to happen. I personally was looking for a trigger point within a few days, but NDX's quick run to stall level precipitated nervosity and selling.
Entropy is still fairly high, and AdStoK while overbought is not pointing to any strong retracement.
We should have some increased volatility in the next few days, then a direction should emerge as a breakout of the [154.50-156-50] trading range.

Weekly: mildly UP.
The Swing indicator is now more firmly up, but the key swing price level is still close at this time frame.
Entropy is slowly looking better, and the trend should be at least mildly up until AdStoK lines cross.
So, for the time being, no visible change in market dynamics coming.
One will have to keep an eye on AdStoK when lines cross, as there is a chance of divergence in this indicator with lines joining at a lower level than prices (double top later on?).

Market Outlook NDX for Oct 12th '07


Dominant TF: Daily and low time frames (15mins)
Swings: DN-UP-UP
Market direction: UP until ...

60mins: Consolidation around 2125 support level. Possible trading range.

Despite the strong bull run, 2188 was given as an important test level. Selling on that level has been as crazy as the previous rise, and should now stop on 2125.
We'll have to watch that level of course, but preferably in a lower time frame (for entry/exit), or EOD for the general trend, which will both have a much higher significance level.

Daily: Despite yesterday's hiccup, no change in trend for now, but still very very overbought. Possible tug-of-war.
This profit taking session had to happen, and I expected it to happen a little later, probably triggered by other indices.
We however had a special configuration with a strong MM resistance on the 60mins chart at the same level as the MM stall level on the daily chart.
Levels to watch: 2125 and lower Fib levels, but one should not panic as there is still a lot of accumulated energy in the market. NDX could just as well bounce to 2250.

Weekly: UP until resistance is found
AdStoK lines should soon meet, but significance level is so low at this time frame, so this is nothing more than a background information.
One can however notice a divergence, hence there is a possible slowdown on forthcoming resistance and line meeting point (within a couple of weeks).

Thursday, October 11, 2007

The Swing Indicator - Part 2



The Swing Indicator

We here have 3 adaptive Swing indicators applied to QQQQ 5 mins, declined in 3 different lengths or Time Frame Multipliers.
The shortest Swing is the white line, calculated over 128 bars. The second one is the yellow line, which with a TF multiplier of 2 calculates swings over 256 bars. The third one is the green line with a TF multiplier of 3.

The Swing indicator also has a Search Depth parameter. In most cases, the default setting (0) will suffice. However, in certain circumstances like a strong bull run, the indicator will obviously 'keep it simple' and bring about a straight line. The user may want to search longer for less obvious waves with a Search Depth parameter set to 1. The plot colour is then a little darker.

Since the indicator focuses on a fixed number of bars, the oldest leg is always incomplete. A future version may be implemented to draw all swings since bar 1, or give the user more flexibility in choosing the number of bars. It is not a technical difficulty, but rather a speed compromise which led to the current design. The Swing indicator indeed uses a Genetic Algorithm to detect pivot points, and can sometimes be computing intensive particularly on low time frames if a number of charts are open simultaneously.

An additional indicator can be added to the chart to retrieve pivot points and calculate Fib retracement and expansions automatically when swing legs show the right characteristics. Please note that communication between indicators, in this particular instance, the swing indicator writing pivot points in shared memory later retrieved by the Fib calculation. The same principle can be applied outside TradeStation, i.e. pivot information can be used in a VC++ program via the API.
More details on the API will be posted soon on a separate site. Contact me for details.

Market Outlook RUT for Oct 11th '07


Dominant TF: Weekly and Daily
Swings: UP-UP-DN
Market direction: Up until...

Note that SPY is the leading symbol in our selection of 3 indices.

60mins: neutral to mildly up.

RUT could just as well break this 843 resistance level or hover a little longer and remain in the narrow 838-845 range. The pivot level has also turned to resistance level indicating more difficulty going higher.
Significance levelis still low, so one should rather follow the daily chart for direction, and look at lower time frames for entry/exit points.

Daily: Mildly UP.
AdStoK is still bullish while quite overbought. It should try going higher until the white line shows some weakness and lines cross (very often indicating a decision point).
Current resistance level at 843 is fairly strong then 860 and ultimately 875.
The gradient of the AdStoK Green Line announces a coming crossover within a couple of days. We may then see some slowing down. Such gradient upon crossing should provide interesting information then, particularly about a possible level breakout or not.

Weekly: UP until...

Entropy and AdStoK now show more clearly the way up to 851, 860 then maybe 875 over the next couple of weeks. The Swing indicator is down again, indicating we are very close to a key turning point.

Wednesday, October 10, 2007

Market Outlook NDX for Oct 11th '07


Dominant TF: 60mins, Daily
Swings: UP-UP-UP
Market direction: UP until ...

No change from yesterday:

60mins: Up, but very overbought.

NDX seems to be heading for the 2188 level now, and no retracement in sight in the short term. Only an influence from SPX may affect this trend to some extent.

Daily: Crazy, i.e. still up.
Nothing seems to be able to stop the trend which seems excessive now.
Levels to watch: 2188 first then 2250. A retracement on 2188 is possible, maybe triggered by economic news or correlation with SPX which is on a test level.

Weekly: UP until resistance is found
AdStoK lines should soon meet, but significance level is so low at this time frame, so this is nothing more than a background information.
One can however notice a divergence, hence there is a possible slowdown on forthcoming resistance and line meeting point.

Market Outlook SPY for Oct 11th '07


Dominant TF: Daily
Swings: UP-UP-UP
Market direction: Mildly UP at least until resistance is tested.

Note that SPY is the leading symbol in our index selection (S&P500, NDX and RUT).

60mins: neutral to mildly UP. Possible congestion.

AdStoK lines haven't joined and Entropy is again coming down a bit. Current resistance at 156.25 is obviously still valid, and since the significance level is not very high, one must look for clues on higher times frames.

Daily: mildly UP until resistance is tested.
Entropy is still quite high, and only slowly declining. AdStoK may soon show first signs of weakness as lines could cross shortly, but this probably won't translate into a retracement any time soon.
We now have to watch how the market attacks the current strong resistance level (all time highs + MM + FIB (60mins)). Note that this MM level is not as strong as same level in July. One can just as well see a strong breakout or a kind of double top. There is still so much accumulated energy that the latter scenario is less probable at this stage.

Weekly: mildly UP.
The Swing indicator is now more firmly up, but the key swing price level is still close at this time frame.
Entropy is slowly looking better, and the trend should be at least mildly up until AdStoK lines cross.
So, for the time being, no visible change in market dynamics coming.
One will have to keep an eye on AdStoK when lines cross, as there is a chance of divergence in this indicator with lines joining at a lower level than prices (double top later on?).

Market Outlook RUT for Oct 10th '07


Dominant TF: Weekly and Daily
Swings: UP-UP-UP
Market direction: Up until...

Note that SPY is the leading symbol in our selection of 3 indices.

60mins: neutral to mildly up.

Despite the positive reaction to the news, one can see that RUT still hovers on the 843 pivot level (range 838-845). The pivot level has also turned to resistance level indicating more difficulty going higher. One will also note that yesterday's up day did not affect Entropy which is very low.

Daily: Mildly UP.
AdStoK is still bullish and should carry on its bumpy ride to higher levels. The white line is now seriously overbought, so a minor retracement is possible without affecting the overall trend... until lines join...
Current resistance level at 843 is fairly strong then 860 and ultimately 875.
AdStoK's green line grows at a rate of 5% per day at the moment, so it could take a couple of days before they cross and possibly see some slowing down (line gradient upon crossing should provide interesting information then).

Weekly: UP until...
Entropy and AdStoK now show more clearly the way up to 851, 860 then maybe 875 over the next couple of weeks. The Swing indicator is up, but remains close to a key turning point.

Market Outlook NDX for Oct 10th '07


Dominant TF: Daily
Swings: UP-UP-UP
Market direction: UP until ...

60mins: Up, but very overbought.

NDX seems to be heading for the 2188 level now, and no retracement in sight in the short term. Only an influence from SPX may affect this trend to some extent.

Daily: Crazy, i.e. still up.
Nothing seems to be able to stop the trend which seems excessive now.
Levels to watch: 2188 first then 2250. A retracement on 2188 is possible, maybe triggered by economic news or correlation with SPX which is on a test level.

Weekly: UP until resistance is found
AdStoK lines should soon meet, but significance level is so low at this time frame, so this is nothing more than a background information.
One can however notice a divergence, hence there is a possible slowdown on forthcoming resistance and line meeting point.

Market Outlook SPY for Oct 10th '07


Dominant TF: Daily
Swings: UP-UP-UP
Market direction: Mildly UP at least until resistance is tested.

Note that SPY is the leading symbol in our index selection (S&P500, NDX and RUT).

60mins: neutral to mildly UP.

SPY reacted to the positive news with a new test of all time highs. AdStoK almost completed it V shape pattern, so we may have a decision point coming when lines join. Entropy has picked up again so one may reach 157.8 (Fib + MM) over the next few days. Current resistance at 156.25 is obviously still valid though.

Daily: mildly UP until resistance is tested.
Entropy is still quite high, and only slowly declining. AdStoK may soon show first signs of weakness as lines could cross shortly, but this probably won't translate into a retracement any time soon.
We now have to watch how the market attacks the current strong resistance level (July highs + MM + FIB (60mins)). Note that MM level is not as strong as same level in July.


Weekly: mildly UP.
The Swing indicator is now more firmly up, but the key swing price level is still close at this time frame.
Entropy is slowly looking better, and the trend should be at least mildly up until AdStoK lines cross.
So, for the time being, no visible change in market dynamics coming.
One will have to keep an eye on AdStoK when lines cross, as there is a chance of divergence in this indicator with lines joining at a lower level than prices (double top later on?).

Tuesday, October 09, 2007

Market Outlook RUT for Oct 9th '07


Dominant TF: Weekly and Daily
Swings: UP-UP-UP
Market direction: Up until...

Note that SPY is the leading symbol in our selection of 3 indices.

60mins: Up, but pivot level then July highs must be tested.

RUT calmed down on the 843 pivot level, so we now have a reprieve on that level with the AdStoK showing a bit of weakness and Entropy falling. Yet the significance level is low, so one may just see some congestion but no serious retracement in the short term. On the contrary, RUT may try and test the pivot level and possibly July highs later on.

Daily: UP.

AdStoK is still bullish and should carry on its bumpy ride to higher levels. The white line is now seriously overbought, so a minor retracement is possible without affecting the overall trend... until lines join...
Current resistance level at 843 is fairly strong then 860 and ultimately 875.
AdStoK's green line grows at a rate of 5% per day at the moment, so it could take at least a few days before it reaches overbought level and some slowing down. The white line may however retrace and provide some relief in the meantime.

Weekly: UP
Entropy and AdStoK now show more clearly the way up to 851, 860 then maybe 875 over the next couple of weeks. The Swing indicator is up, but remains close to a key turning point.