Friday, November 30, 2007

Market Outlook RUT for Nov 30th '07


Dominant TF: Daily, and 15mins (not shown).
Swings: UP-UP-DN (from DN-DN-DN)
Market direction: Congestion to Up.

60mins: Congestion.

Pattern is unclear but parallel and slightly downward MTFS lines tend to indicate congestion, and Entropy has also peaked.

Daily: congestion to mildly up
This early MTFS crossover is very seldom conducive to a definite change in direction. A congestion is likely, and RUT should try and find a stronger base for support.
As for other symbols, RUT seem to show evidence of a cycle turning point, so any retracement should be limited (757, and 750 in the worst scenario)

Weekly: return to the trading range

We're now back in our [750-875] range, and still pretty much directionless. It will be interesting to see whether RUT closes the week over the lower end of the channel (~763). It seems that the 'double top' scenario is now a little more remote, but we should wait for the bar to change colour first.

Market Outlook SPY for Nov 30th '07


Dominant TF: Daily
Swings: UP-UP-DN (from DN-DN-DN)
Market direction: up, but a pause is likely.

Note: swing gradient are opposite on daily and weekly charts, and both have too steep a gradient to be stable.
Daily chart has a much higher significance though so overall upward bias is likely.

60mins: congestion to up

Recovery stalled on PR1 (38.2% Fib upward retracement), and there will be hesitation between running for 150 and pausing a bit. MTFS and Entropy show signs of weakening albeit without serious downward pressure. A [147-150] trading range is likely.

Daily: congestion to up
Again, PR1 at 147.10 marked a pause in current recovery. MTFS is not showing the easiest pattern as an early crossover (above oversold territory) generally occurs on negative gradient indicating a forthcoming double bottom or cup and handle. The positive gradient this time may mean little or no retracement down to a stronger base for rebound.
SPY will try and reach Fib expansion levels starting with 148.4, but MTFS indecision may mean some congestion ahead.

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 slightly upward biased (higher highs and higher lows).

Market Outlook NDX for Nov 30th '07


Dominant TF: 60mins, but 15 mins charts
Swings: UP-UP-DN (from UP-DN-DN)
Market direction: Recovery is yet to be confirmed.

2nd day recovery was mild but at least held up. Again a stronger base is needed to go higher but should it fail to retrace (2062?) a congestion at first may be good enough.
Lower time frames provide a better picture at the moment.


60mins: congestion to up, but some retracement is also possible.
MTFS and Entropy show a likely slow down, but in this high volatility environment NDX may have enough momentum to reach the 2125 pivot level first.

Daily: mildly up
Swing now also turned up, and MTFS is in better looking U-shape pattern. Such pattern's validity depends on the depth of the green line which is only mildly positive. This means the upward potential is relatively limited in the short term (2125?). It is only if/once 2125 is passed that NDX will likely return to the overall bullish trend and reach Fib targets, with 2250 being very significant (strong MM resistance as well).

Weekly: trading range
NDX is firmly back in its channel. However current movements are too fast for this time frame.

Thursday, November 29, 2007

Market Outlook RUT for Nov 29th '07


Dominant TF: Daily, and 15mins (not shown).
Swings: UP-UP-DN (from DN-DN-DN)
Market direction: UP, but recovery must be confirmed.

See yesterday's post ("Check Cycles") as well as NDX and SPY commentaries today.

60mins: Up, but recovery must be confirmed.

Admittedly surprised by yesterday's move.
MTFS and Entropy look better but the MTFS green line is lagging behind while the white line reaches overbought territory very quickly. This indicates a likely pause (we even have a possible AutoFib pattern pointing south).
The 150 level could even be tested again for support.

Daily: congestion to mildly up
We expected a congestion and we got that sudden burst upward. The MTFS crossover on a negative gradient does not point for RUT going much higher for now, and while the fall looks stopped, a stronger base will need to be found to go higher (150?).
As for other instruments, cycles seem to show a turning point, however slightly delayed compared to NDX. Looking at MTFS, it is quite possible that such turnaround will occur after a stronger support is found within a few bars.

Weekly: return to the trading range
It is interesting to see RUT possibly closing the week over the lower end of the channel. For the time being, let's push the 'double top' scenario a little further (we might dump it in a few weeks). We're therefore now back in our [750-875] range, and pretty much directionless there.
Again, RUT has always bounced on PR2 in the last 2 years, and it may just behave the same this time again.

Market Outlook SPY for Nov 29th '07


Dominant TF: Daily
Swings: UP-DN-DN (from DN-DN-DN)
Market direction: up, but a pause is likely.

See notes on NDX post, in particular about cycles. SPY cycle seems a little lagged compared to NDX's

60mins: up, but recovery must be confirmed

Admittedly surprised by the strength of this recovery, even if we knew a breakout was possible. MTFS and Entropy do point higher but caution must be exercised. A pause is quite possible on the way to 150.

Daily: up, but recovery must be confirmed
Despite yesterday's "burst" MTFS and Entropy still do not look great. At this stage we can assume the price erosion has stopped but it is likely that the recovery will need a stronger base. Let's wait until MTFS lines meet. When confirmed, we'll watch for the AutoFib targets and obviously the 50% retracement and MM level at 150.

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 down bias. The lower end of the range could be tested again.

Market Outlook NDX for Nov 29th '07


Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: UP-DN-DN (from UP-DN-DN)
Market direction: Recovery is yet to be confirmed.

You may have noticed over the last few days that i advised
about checking lower times frames, as something was boiling under the hood. Secondly, I mentioned yesterday that it would be worth taking a look at cycles. Of course, I have warned again that cycles must be analysed with a lot of caution, yet it seems to have proved right this time.

60mins: up, but check resistance level around 2095 then 2125

The 2030 pivot level disappeared at the open, and the 2060 didnt show much resistance either. Fractal levels are still about 31 points apart, and NDX gathered enough momentum to get the next resistance level (more significant on lower time frames). Current level can hower pause the recovery.
Indeed MTFS and Entropy are strong but 'half-way' through only. Recovery must therefore be confirmed. Again, it is recommended to follow the 15mins chart (Sig Level = 92%).

Daily: mildly up
I would suggest reading yesterday's commentary again.
A bounce was announced, but due caution was also expressed as such recovery could have started from a lower base. Having said that, cycles, AutoFib, and engaging looking at lower time frames should have made possible to be there on time.
Where do we go from here? The MTFS pattern is not bullish yet so it is essential to wait to see the recovery confirmed over the next few days. Such recovery after such an incredible day (+3%) will obviously slow down. It is likely that if/once 2125 is passed, NDX will likely return to the overall bullish trend and reach Fib targets.

Weekly: congestion to mildly up - low significance level.
Bounce on the lower end of the channel and 2000 support level should help NDX go a little higher.
This is however not a very significant time frame.


Reminder on cycles:
1) check error level is close to Lag128's optimal error level
(a visual check can do no harm either)
2) check shape of blue curve (quarter cycle phase advance) for a top/bottom
3) count bars (quarter cycle) to gauge potential forthcoming turnaround on cycle (magenta curve)
4) ALWAYS CHECK FOR SUPPORTING INFORMATION (MAINLY MM AND FIB)

NOTE: This genetic algorithm is VERY processing intensive so should only be applied to EOD charts

Wednesday, November 28, 2007

Market Outlook RUT for Nov 28th '07


Dominant TF: Daily, and 15mins (not shown).
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: DOWN, but support may be found in the low 730s

Same situation, so market commentary is quite similar today.
The mild bounce on 734.50 occured as expected.
Note: Check Cycles.

60mins: Down, but probable congestion on strong support level

MTFS and Entropy look a little bearish, and indicator continuation of this [730-750] trading range. Note that there is no recovery potential in the short term.

Daily: down...

MTFS looks bearish but the white line is stabilising indicating there could be a congestion at this low level. Same for Entropy. Increased volatility is possible but no chance of a recovery in the short term. Since MTFS has to complete its pattern, even a recovery would take a few days to exhaust the negative pressure, and could start from this 141 level, or lower around 734 or 730.

Weekly: caution but no panic
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may also remain in a broad [750-875] trading range with a lower bias (MTFS lines). 750 is not broken yet on this time frame. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 28th '07


Dominant TF: 60 mins & Daily
Swings: UP-DN-DN (from DN-DN-DN)
Market direction: mildly down - possible congestion on current levels

Unlike NDX, the daily time frame gives us a very good picture.

60mins: congestion on current levels

Entropy and MTFS both still point toward continuation of price erosion with a possible congestion (140.6 is a support level on lower time frames). No real recovery potential in the short term until we get a clearer picture from MTFS and Entropy.

Daily: Congestion to mildly down.
MTFS and Entropy do not look too good and at this stage it is likely that the fall or at least price erosion will continue until MTFS lines meet. The White Line is stabilising so congestion is a likely scenario, indicating that support levels at 141 could hold (otherwise 137.50). Again let's first wait for a MTFS crossover.
While it is certainly too early, AutoFib has detected a recovery pattern. The last pivot (no4) should however first stabilise to consider it seriously.

Weekly: congestion to 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 down bias. The lower end of the range could be tested again.

Market Outlook NDX for Nov 28th '07


Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: UP-DN-DN (from DN-DN-UP)
Market direction: Congestion. Behaviour around 2000 remains key.

Again, dominant time frames are now shorter intraday time frames, so obviously only users of the TS technique can fully appreciate current dynamics. Reading the 15 mins chart is very simple with a significance level of 91% and looks congested.

60mins: congestion - low significance level due to congestion

We're back on a 2000 support level, and congestion continues. 2030 is now a pivot level on lower time frames and serves as a resistance for the time being. No direction can be drawn from this time frame, but this is a great environment for scalping.

Daily: congestion to down
MTFS and Entropy still look a little bearish but the 2000 cannot be regarded as broken just yet. 2000 is still key level, and a bounce is possible within the next few days. Since the overall mood is bearish such rebound can very much take place a little lower for instance at PR2 (1970). We shall obviously remain careful until the MTFS pattern is completed. One cannot discard a recovery at as Entropy show signs of bottoming out (Bin=-3). The AutoFib gives a potential recovery to levels we have seen recently (COP ~ 2250).
Note: the lower significance level indicates that MTFS will adapt a little late, so recovery (if any) should detected on a 15mins chart.

Weekly: congestion to mildly down - low significance level.

The profit taking we've seen can stop here on the lower channel boundary reinforced by a strong support level. We cannot however ignore a potential breakout to 1935 PR1 retracement level.
Note: Swing uses a search depth parameter of 1 (refined search). Standard search returns UP. This indicates possible indecision on future direction.

Tuesday, November 27, 2007

Market Outlook RUT for Nov 27th '07


Dominant TF: Daily, and 15mins (not shown).
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: DOWN, but support may be found in the low 730s
Same situation, so market commentary is quite similar today
60mins: Down, but probable congestion on strong support level
MTFS and Entropy look bearish, with congestion potential around the [730-750] trading range now that 750 is 'history'. RUT will try and stop its fall on 734.5, then 730 (would take more than a day though).Note that there is no recovery potential in the short term.

Daily: down...
Bearish MTFS lines have quite negative gradients indicating RUT going lower, thus pushing support level also lower (730?). The white line is stabilising indicating there could be a congestion at this low level... but certainly no chance of a recovery in the short term. The next Fib level is around 731 (close to August lows). 730 will be a key level. Since MTFS has to complete its pattern, even a recovery would take a few days to exhaust the negative pressure.
Weekly: caution but no panic
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may also remain in a broad [750-875] trading range with a lower bias (MTFS lines). The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 27th '07


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

Unlike NDX, the daily time frame gives us a very good picture.

60mins: Down, but possible congestion on current levels
Entropy and MTFS both still point toward continuation of price erosion with a possible congestion (140.6 is a support level on lower time frames). No real recovery potential in the short term until MTFS lines join.
Daily: Down.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. SPY could eventually fall further to 141 (Fib) or even 137.50 (MM).While it is certainly too early, AutoFib has detected a recovery pattern. The last pivot (no4) should however first stabilise to consider it seriously.

Weekly: congestion to 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 down bias. The lower end of the range could be tested again.

Market Outlook NDX for Nov 27th '07


Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: DN-DN-UP (from DN-DN-DN)
Market direction: Congestion to down. Behaviour around 2000 remains key.

Again, dominant time frames are now shorter intraday time frames, so obviously only users of the TS technique can fully appreciate current dynamics. Reading the 15 mins chart is very simple with a significance level of 91% and point decidedly south.

60mins: congestion to down - low significance level due to congestion
2000 has been broken, but lower time frames show a 1989 support level anyway, and those times frames are more significant at the moment. MTFS and Entropy do not point towards a fall so 1989 should hold in the short term.

Daily: congestion to down
MTFS and Entropy still look bearish but the 2000 cannot be regarded as broken just yet. 2000 (or 1989?) is still key level, and a bounce is possible in the next few days. Since the overall mood is bearish such rebound can very much take place a little lower for instance at PR2 (1970). We shall obviously remain careful until the MTFS pattern is completed. One cannot discard a recovery at this level. The AutoFib gives a potential recovery to levels we have seen recently (COP ~ 2250).
Note: the lower significance level indicates that MTFS will adapt a little late, so recovery (if any) should detected on a 15mins chart.
Weekly: congestion to mildly down - low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have a potential 1935 PR1 retracement level, so it could certainly come a little more down. In such case one cannot ignore that breaking the current channel would accelerate into serious selling pressure (PR2 = 1750 ...) but no panic just yet. 2000 is still holding...

Saturday, November 24, 2007

Thanksgiving

A bit of a technical bounce on Friday, but volumes are very low on this half-day Friday.

Updating charts would not be significant.

See you next week.

Thursday, November 22, 2007

Market Outlook RUT for Nov 23rd '07



Dominant TF: Daily, and 10mins (not shown).
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: DOWN, but support may be found in the low 730s

60mins: Down, but probable congestion on strong support level

MTFS and Entropy look bearish, with congestion potential around the [730-750] trading range now that 750 is 'history'. RUT will try and stop its fall on 734.5, then 730 (would take more than a day though)

Daily: down...
Bearish MTFS lines have quite negative gradients indicating RUT going lower, thus pushing support level also lower (730?). Definitely no chance of a recovery in the short term. The next Fib level is around 731 (close to August lows), but one should not panic just yet... at least not until 730 breaks as well... We have to wait for the MTFS pattern to complete to get a better picture.

Weekly: caution but no panic
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may also remain in a broad [750-875] trading range with a lower bias (MTFS lines). The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 23rd '07



Dominant TF: 60 mins & Daily
Swings: DN-DN-UP (from DN-DN-DN, weekly swing is hesitant)
Market direction: down

60mins: Down, but possible congestion

Entropy and MTFS both still point down but the MTFS white line holding above shows congestion potential. MTFS lines will now probably meet lower. No real recovery potential in the short term.

Daily: Down, but check for support level.

MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. SPY could eventually fall further to 141 (Fib) or even 137.50 (MM). However the current fall in Entropy is not too alarming (see LEntBin), so congestion may happen on this support level.

AutoFib already gives some potential recovery levels (L1 to L5) if current swing pivot holds (this is however too early).

Weekly: congestion to mildly 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 down bias.
Caution: One shall note that 143.75 has broken, Swing indicator is hesitant at this level indicating we are close to a key level. One should also check for a possible channel breakout.

Market Outlook NDX for Nov 23rd '07



Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: DN-DN-UP (from UP-DN-UP)
Market direction: Congestion to down. Behaviour on 2000 will be key.

Dominant time frames are now shorter intraday time frames, so obviously only users of the TS technique can fully appreciate current dynamics. Reading the 15 mins chart is very simple with a significance level of 82%

Interpretation very similar as yesterday's

60mins: more or less same trading range [2000-2030] with lower bias
More congestion ahead. Bias remains down, so behaviour on 2000 is obviously key.

Daily: Possible trading range with lower bias.
MTFS and Entropy both look fairly bearish but 2000 is defended ferociously. The MTFS white line has started showing stabilisation, so there will be more congestion and fighting on the 2000 support level. There is however a potential to go somewhat lower, at least until MTFS lines meet. Further down the line: If 2000 breaks, we have a possible 1935 target later on. On the other hand, should the latest pivot point hold which is quite possible since 2000 is now strong support, we have our AutoFib showing a potential recovery to levels we have seen recently (target levels displayed on picture).

Weekly: congestion to mildly down - low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 retracement level, so it could certainly come a little more down. In such case one cannot ignore that breaking the current channel would accelerate into serious selling pressure, but no panic just yet. 2000 is still holding...

Wednesday, November 21, 2007

Market Outlook RUT for Nov 21st '07


Dominant TF: Daily, and 10mins (not shown).
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: DOWN, but support may be found soon (in the 730s if 750 breaks).

In such high volatility environment, lower intraday time frames are doing fine. The picture is however pretty good on this snapshot too.


60mins: Down, but probable congestion on strong support level
MTFS and Entropy look bearish, with congestion potential around 750 key level. One should be careful as if 750 fails to be penetrated on the upside, RUT will fall to 734.5, then 730 (would take more than a day though)

Daily: down, possible congestion on 750 level but...
Entropy is stabilising on moderately low levels, but the bearish MTFS lines have quite negative gradients indicating RUT going lower, thus pushing support level also lower (730?). Definitely no chance of a recovery in the short term. Should 750 break, the next Fib level is around 731 (close to August lows), but this scenario is now becoming quite realistic.

Weekly: congestion to mildly down
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may also remain in a broad [750-875] trading range with a lower bias (MTFS lines). The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Note: we've had a channel since mid 2003 which could break, so we should remain cautious. Breaking 731 would be however alarming.

Market Outlook SPY for Nov 21st '07


Dominant TF: 60 mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: down bias but expect some fighting on 143.75 support or lower...

60mins: Down, unless current MM pivot level holds.

Entropy and MTFS both still point down or just a congestion within the current trading range. Lows around current pivot level (143.75) have been tested. We now have to see how the MTFS bearish pattern develops until lines meet. No real recovery potential in the short term.

Daily: Down, but check support levels.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. MTFS may indicate a congestion around current lows. SPY could eventually fall further to 141 (Fib) or even 137.50 (MM). However the current fall in Entropy is not too alarming (see LEntBin), so congestion may happen on this support level.

AutoFib already gives potential recovery levels (L1 to L5) if current pivot holds.

Weekly: congestion to mildly 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 down bias. If 143.75 fails to hold, SPY could well also test the 137.50 level for a 3rd time...

Market Outlook NDX for Nov 21st '07


Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: UP-DN-UP (from DN-DN-DN)
Market direction: Congestion to down. Behaviour on 2000 will be key.

I repeat the same caveat: Dominant time frames are now shorter intraday time frames , so obviously only users of the TS technique can fully appreciate current dynamics. Reading the 10 mins chart is very simple with a significance level of 94%

Interpretation very similar as yesterday's

60mins: more or less same trading range [2000-2060] with lower bias

Definite congestion ahead. Bias remains down, so behaviour on 2000 is obviously key.

Daily: Possible trading range with lower bias.
MTFS and Entropy both look fairly bearish and 2000 had to be tested. We indeed have conflicting information arising from the MM level showing a reinforced support level. The MTFS white line has started showing some inflexion, so there will be more fighting on the 2000 support level. Please note that the MTFS pattern has to complete with lines joining almost always in oversold territory. This indicates a potential to go somewhat lower, or at least a long battle (3 or 4 days min).
Further down the line: If 2000 breaks, we have a possible 1935 target later on. On the other hand, should the latest pivot point hold which is quite possible since 2000 is now strong support, we have our AutoFib showing a potential recovery to levels we have seen recently (target levels displayed on picture).

Note: LEntBin has been momentarily added to the chart. It helps assess the importance of the current drop in Entropy in relation to historical levels. We can see that the current level -5.33 is in fact not so alarming.

Weekly: congestion to mildly down - low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 retracement level, so it could certainly come a little more down. In such case one cannot ignore that breaking the current channel would accelerate into serious selling pressure, but no panic just yet. 2000 is still holding...

Tuesday, November 20, 2007

Market Outlook RUT for Nov 20th '07


Dominant TF: Daily, and 10mins (not shown).
Swings: DN-DN-DN
Market direction: DOWN, but support may be found soon.

60mins: Down, but probable congestion on strong support level

MTFS and Entropy look bearish but 750 should hold implying a probable congestion. Some short term recovery is also possible.

Daily: mildly down, possible congestion on 750 level.
Entropy shows signs of bottoming out, and the bearish MTFS lines despite having negative gradients (indicating RUT going lower) could join soon. No chance of a recovery for the time being.
Should 750 break, the next Fib level is around 731 (close to August lows), but this scenario is less likely at first.

Weekly: congestion to mildly down

At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may have a broad [750-875] trading range. The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 20th '07


Dominant TF: Daily
Swings: DN-DN-DN
Market direction: down, til next support level...

Note: Significance level is 'alright' albeit much better in low intraday time frames.

60mins: Down, unless current MM pivot level holds.

Entropy and MTFS both point down or just a congestion within the current trading range. Lows around current pivot level (143.75) have been tested. We now have to see how the MTFS bearish pattern develops until lines meet.

Daily: Down, but check support levels.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. MTFS may indicate a congestion around current lows. SPY could eventually fall further to 137.50. However the current fall in Entropy is not too alarming (see LEntBin), so congestion may happen on support level.

Weekly: congestion to mildly 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 down bias. If 143.75 fails to hold, SPY could well also test the 137.50 level for a 3rd time...

Market Outlook NDX for Nov 20th '07



Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: DN-DN-DN
Market direction: Congestion to down. Behaviour on 2000 will be key.

I repeat the same caveat: Dominant time frames are now shorter intraday time frames , so obviously only users of the TS technique can fully appreciate current dynamics. The 2015.63 support level held, giving bulls some hope the worst is over.
A short term recovery is possible, without affecting the overall direction.

60mins: more or less same trading range with lower bias

Significance level is down again at this time frame, so a divergence is likely to occur. For the time being, the MTFS pattern indicates a trading range with a definite lower bias. NDX should test 2016 again, then 2000. That level is far too anticipated though.

Daily: Possible trading range with lower bias.
MTFS and Entropy both look quite bearish and 2000 somehow has to be tested. We however here have conflicting information arising from the MM level which shows a reinforced support level. The MTFS white line has started showing some inflexion, so there will be some fighting going in and a a trading range with a lower bias is likely at first. Please note that the MTFS pattern has to complete with lines joining almost always in oversold territory. This indicates a potential to go somewhat lower.
Further down the line: If 2000 breaks, we have a possible 1935 target later on. On the other hand, should the latest pivot point hold which is quite possible since 2000 is now strong support, we have our AutoFib showing a potential recovery to levels we have seen recently (target levels displayed on picture).

Note: LEntBin has been momentarily added to the chart. It helps assess the importance of the current drop in Entropy in relation to historical levels. We can see that the current level -5.33 is in fact not so alarming.

Weekly: congestion to mildly down - very low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 level, so it could certainly retrace a little more. Speed is however difficult to anticipate in this high vol environment.Again significance level is so low one should not jump to conclusions too quickly.
(Note: Swing's search depth turned to 'refined')

Saturday, November 17, 2007

Market Outlook SPY for Nov 19th '07


Dominant TF: Daily
Swings: DN-DN-DN
Market direction: down, til next support level.

Again it is recommended to study all three daily snapshots not only to get an overall picture but to better understand the technique itself.
60mins: Congestion to down - Fairly low significance level
Entropy and MTFS point toward a minor fall or just a congestion within the current trading range. However 150 is now the upper resistance level, so one cannot discard testing lows again. Lower time frames which have proved more significant lately give a 144.53 support level.One shall note that the 143.8 support level has turned to pivot indicating some bearish potential. We have to see how the MTFS pattern develops until lines meet.
Daily: Mildly down.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. We have to see whether the last bounce on PR2 around 145 will hold again.
MTFS may indicate a congestion around current lows.

Weekly: congestion to mildly down - very low significance level.
This time frame has such a low significance level it is 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 down bias. If 145 fails to hold, SPY could well also test the 137.50 level for a 3rd time...

Market Outlook RUT for Nov 19th '07


Dominant TF: Daily, and 10mins (not shown).
Swings: DN-DN-DN
Market direction: DOWN, but support may be found soon.

The strong support level on 765.63 shown on short time frames yesterday has been confirmed now on the 60mins chart. We have a recovery potential until 774 in the short term after the afternoon run on Friday.

60mins: down til support is tested
Significance level is still low, but MTFS and Entropy do indicate RUT going somewhat lower. The 766 level should not hold, but in the meantime we should have some fighting on current level. Please note that failing to pass 781 would immediately mean bears testing the 750 level (Fib target and strong MM level).

Daily: mildly down.
Again we have to wait until the bearish MTFS finally meet. Entropy shows signs of bottoming out, and the MTFS white line has recovered a bit, yet the lines gradients indicate RUT going lower or at least remaining in a congestion area around current levels. No chance of a recovery for the time being.

AutoFib seems to indicate a possible Fib down pattern, yet 750 would have to be passed first. If so, a Fib target at 731 close to August lows could be reached.

Weekly: congestion to mildly down
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may have a broad [750-875] trading range. The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook NDX for Nov 19th '07

Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: UP-DN-UP
Market direction: congestion to down.

I repeat the same caveat: Dominant time frames are now shorter intraday time frames , so obviously only users of the TS technique can fully appreciate current dynamics. The 2015.63 support level held, and the 2031 pivot level also held when tested early afternoon, giving bulls some hope the worst is over. The day ended on a high note at 2048.

60mins: [2031-2063] trading range at first
Significance level is declining at this time frame. The MTFS pattern only indicates a trading range with a slight up bias. A graphical pattern should prevail (pennant or MM level breakout)

Daily: Down, then possible trading range.
MTFS and Entropy both look quite bearish and as expected 2000 had to be tested (low 2006). We however here have conflicting information arising from the MM level which shows a reinforced support level. The MTFS white line has started showing some inflexion, so there will be some fighting going in and a a trading range with a lower bias is likely at first.Please note that the MTFS pattern has to complete with lines joining almost always in oversold territory. This indicates a potential to go lower. If 2000 breaks, we have a possible 1935 target later on. On the other hand, should the latest pivot point hold we have our AutoFib showing a potential recovery to levels we have seen recently (target levels displayed on picture).

Weekly: congestion to mildly down - very low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 level, so it could certainly retrace a little more. Speed is however difficult to anticipate in this high vol environment.Again significance level is so low one should not jump to conclusions too quickly.

Friday, November 16, 2007

Market Outlook RUT for Nov 16th '07


Dominant TF: Daily, and short intraday time frames.
Swings: DN-DN-DN
Market direction: DOWN, but support may be found soon.

Same Nota Bene.... check shorter time frames which seem to indicate strong support on 765.63

60mins: down til support is tested

Significance level is still low, but MTFS and Entropy do indicate RUT going somewhat lower. For the time being, it seems the 766 support level will hold.

Daily: mildly down.
Almost the same as yesterday:MTFS is bearish until lines meet, and Entropy is very bearish although at -5.5 it is likely to bottom out soon. A Fib pattern may have completed at 767, and may be tested again (or close) to complete the pattern fully. There is no indication yet that it will go much lower for now. No chance of a recovery though.

Weekly: congestion to mildly down
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may have a broad [750-875] trading range. The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 16th '07


Dominant TF: Daily, but mostly shorter intraday time frames
Swings: DN-DN-DN
Market direction: down, til next support level.

Same Nota Bene as for NDX (cf previous post).Lower intraday time frames seem to show the 145.31 level could hold but overall direction is still down.

60mins: Congestion to down - Lower significance level
Entropy and MTFS point toward a minor fall or just a congestion within the current trading range. However 150 is now the upper resistance level, so one cannot discard testing lows again.
One shall note that the 143.8 support level has turned to pivot indicating some bearish potential.

Daily: Down.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. We have to see whether the last bounce on PR2 around 145 will hold again.

MTFS may indicate a congestion around current lows.

Weekly: congestion to mildly down - very low significance level.
This time frame has such a low significance level it is 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 down bias. If 145 fails to hold, SPY could well also test the 137.50 level for a 3rd time...

Market Outlook NDX for Nov 16th '07


Dominant TF: Daily, but mostly 10 and 15 mins charts
Swings: DN-DN-UP
Market direction: congestion to down.

Dominant time frames are now shorter intraday time frames , so obviously only users of the TS technique can fully appreciate current dynamics. In particular, a support level at 2015.63 is in place, probably as the last defense line before 2000.

60mins: down
Significance level is declining at this time frame. The MTFS pattern only indicates a trading range with a down bias, so one can only anticipate some attempt to test 2000. Most traders feel the same, so some contrarian behaviour is possible.

Daily: Down, until support is tested again, then possible trading range.
MTFS and Entropy do look bearish and it seems clear the 2000 level will be hit. In such circumstances, the MTFS pattern has to complete, almost always in oversold territory. This indicates a potential to go lower (I mentioned a possible 1935 target yesterday), yet the 2000 level has turned from pivot to strong support, so there will certainly be some fighting on this level.

We can also note that the AutoFib indicator shows a possible recovery (target levels displayed on picture).

Weekly: congestion to mildly down - very low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 level, so it could certainly retrace a little more. Speed is however difficult to anticipate in this high vol environment.Again significance level is so low one should not jump to conclusions too quickly.

Thursday, November 15, 2007

Market Outlook RUT for Nov 15th '07


Dominant TF: Daily, and short intraday time frames.
Swings: UP-DN-DN
Market direction: DOWN

Back from a nice break in the African bushveld...

60mins: congestion
MTFS and Entropy both indicate a congestion with a slight upward bias, but the significance level is very low, so onw should rather look at shorter intraday time frames for trading points or follow the daily chart for direction.

Daily: DOWN.
MTFS is bearish until lines meet, and Entropy is very bearish although at -5.5 it is likely to bottom out soon. A Fib pattern may have completed at 767, and may be tested again (or close) to complete the pattern fully. There is no indication yet that it will go much lower for now. No chance of a recovery though.

Weekly: congestion to mildly down
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may have a broad [750-875] trading range. The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Market Outlook SPY for Nov 15th '07


Dominant TF: Daily, but mostly shorter intraday time frames
Swings: UP-DN-DN
Market direction: congestion to down.

Back to my daily snapshots after a great time in the African bushveld...

60mins: Congestion to down - Lower significance level
Entropy and MTFS point toward a minor fall or just a congestion within the current trading range. However 150 is now the upper resistance level, so one cannot discard testing lows again.

Daily: Down.
MTFS and Entropy do not look good and at this stage it is likely that the fall will continue until MTFS lines meet. We have to see whether the last bounce on PR2 around 145 will hold again.

Weekly: congestion to mildly down - very low significance level.
This time frame has such a low significance level it is 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 down bias. If 145 fails to hold, SPY could well test the 137.50 level for a 3rd time...

Market Outlook NDX for Nov 15th '07


Dominant TF: 60mins, Daily, but mostly 15 and 30 mins charts
Swings: UP-DN-UP
Market direction: congestion to down.

Back to my daily snapshots after a great time in the African bushveld...

60mins: down
The down draft is not over yet, but Entropy and MTFS do not point toward a fall but rather to a test of 2000 again. Significance level at 0.69 is alright, but one should certainly take cues from shorter time frames for trading points.

Daily: Down.
MTFS and Entropy do not look good... One should pay attention to Fib and MM levels. MM target is 2000, then 1935 is a combined MM + Fib. Let's first see whether 2000 holds again...

Weekly: congestion to mildly down - very low significance level.
We knew we had to watch for that growing divergence, and Entropy peaking. Now, there is still no overall change in direction and this profit taking is only healthy after such a bull run. We have recurrence of the 1935 level, so it could certainly retrace a little more. Speed is however difficult to anticipate in this high vol environment.

Friday, November 09, 2007

Back to Nature

Taking a break until Nov 15th...

Delta negative options traders as well as short sellers should be happy. Just check MM and Fib levels for the time being for a possible recovery point. Users of this technique will also follow evolution of MTFS until lines meets as well as peak/troughs in Entropy. This market configuration should not be too difficult to analyse.

See you next week :)

Market Outlook RUT for Nov 9th '07


Market Outlook SPY for Nov 9th '07


Market Outlook NDX for Nov 9th '07

Thursday, November 08, 2007

Market Outlook RUT for Nov 8th '07


Dominant TF: 60mins & Daily.
Swings: DN-DN-UP
Market direction: DOWN

60mins: DOWN.
What an interesting day... RUT was not indied anticipated to go higher, but i thought the trading range would hold. 781 was a possible target if 791 had to break, but 775 seems to now indicate a lower support still. MTFS is bearish, but Entropy is only just picking up steam...

Daily: DOWN.
Yesterday's close below 781 may indicate RUT going lower, to much lower. A return to 750 is possible, with a first target around 767. One could possibly have a reprieve if RUT closes above 781 today, but MTFS and Entropy are quite bearish so it is unlikely.

Weekly: congestion to mildly down
Entropy and MTFS indicate continuation of this situation of congestion with a downward bias. We can note that we are again very close to a key level at this time frame with the Swing indicator oscillating frequently.Same as SPY, divergence and a double top are to watched carefully now. The MTFS shape is not of a double top, so a broad trading range (roughly [750-875] is a more likely scenario for the time being.

Market Outlook SPY for Nov 8th '07


Dominant TF: 60mins, Daily and low intraday time frames
Swings: DN-DN-UP
Market direction: looking for support...

60mins: Down, support to be found toward next MM+ Fib level.
Always difficult to assess movements in both a very high volatility environment and so close to key levels. Lower time frames certainly helped a lot here.150 despite being strong broke, was tested again as a resistance, which is always an open door for bear who sold heavily in the last part of the day.We have 2 bearish Fib patterns both pointing for a first support level around 146. MTFS and Entropy certainly confirm this.

Daily: down.
Yesterday's scenario did not quite anticipate 150 to be broken even if we had negative entropy and a MTFS that didn't look too good. MTFS is certainly a lot more bearish now, so support can be found somewhat lower. Fib levels to be checked carefully (both retracement and expansion levels). Entropy is not dramatically low, so we're not in any sort of crash or meltdown... i.e. no panic just yet.

Weekly: probable congestion - Very low significance level, due to MTFS divergence.
We've been warning about MTFS divergence and a possible double-top. The MTFS pattern is however not that of a double top as such, so one should not jump to conclusions just yet, but certainly remain cautious.

Market Outlook NDX for Nov 8th '07


Dominant TF: Daily
Swings: DN-UP-UP
Market direction: congestion - larger trading range on account of volatility

60mins: Congestion to down - Movements exaggerated by market volatility
I admittedly got it wrong here. I expected a congestion or a trading range [2188 - 2220] but certainly not the lower boundary to be broken so decisively. The Significance levels had dropped over the last few days, and lower time frames provided a clearer picture, which cannot be expressed on a daily snapshot.The bias is now down, but despite the high volatility, one should not expect any sort of fall or meltdown.NDX should find some support around 2165... or 2125!

Daily: Congestion.
This down day is no more than normal congestion ahead of the strong 2250 resistance. The expected slowdown is now there, but we still do not have conditions for a major retracement right now. Having said that a support must be found lower.

Weekly: congestion to mildly UP - Low significance level.
Entropy is still looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). 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, but we have to watch how this divergence develops. A peak in Entropy will also be an alert of a change in dynamics.

Wednesday, November 07, 2007

Market Outlook RUT for Nov 7th '07


Dominant TF: 60mins & Daily.
Swings: UP-DN-UP
Market direction: congestion to mildly down. Bounce up at first.

60mins: Up, but check levels carefully.
Same as SPY, the 60mins chart having a 2 to 5 bars visibility like any other chart, we could not anticipate the afternoon bounce, even the support level was clearly identified. MTFS is not in its best shape, so there is no reason to believe it will go much higher. PR2 at 812.5 seems pretty strong right now.

Daily: Congestion to down. Support level on 791 is so far holding.
Despite yesterday's bounce, the picture is still bearish.We seem to have a Fib pattern forming, and 791 may not hold very long as MTFS and Entropy look more and more bearish now. One could therefore see RUT going lower to 781 (Fib + MM level).

Weekly: congestion to mildly down
Entropy and MTFS indicate continuation of this situation of congestion with a slight downward 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 Nov 7th '07


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

60mins: up, but MM & Fib levels to be checked.
We were yesterday at a junction and it could have gone both ways. It seems the 150 level (MM + Fib) held well, so a bounce is in order for the time being. We'll have to pass 153 to possibly resume the up trend we had before. If so, the all time highs are the next target.

Daily: congestion.
Significance level is slowly coming down, indicating we'll have to pay more attention to lower time frames. Unlike the 60mins chart, the daily chart (almost as significant) shows a congestion with a lower bias. For the time being, MTFS is not very bearish, hence the lower to mid part of the [150-156] range is still valid.

Weekly: probable congestion - Very low significance level, due to MTFS divergence.
Entropy is looking OK but coming down, but MTFS indicates continuation of this situation of congestion with a slight upward bias. Watch for divergence and possible double-top.With such a low significance level, one should rather take cues from lower time frames.

Market Outlook NDX for Nov 7th '07


Dominant TF: Daily
Swings: UP-UP-UP
Market direction: up again...

60mins: Up again.
I anticipated some congestion before the bounce up, so the timing was not quite correct as it happened during the course of the day. Obviously, the 60mins chart provides visibility a few bars ahead, and dynamics can change during the course of the day (7 bars).The analysis remains about the same: MTFS and Entropy are both indicative of some upward bias (Energy is just picking up). It may provide some strength later on to reach 2250 (potential Fib pattern).

Daily: Congestion to Up, slow down approaching strong resistance level.
NDX should creep up to previous highs, albeit considerably slower in comparison to what we've seen in the last couple of months. The rise may stall, but certainly no strong retracement in sight. 2250 seems a reasonable target now.

Weekly: congestion to mildly UP - Low significance level.
Entropy is still looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). 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, but we have to watch how this divergence develops. A peak in Entropy will also be an alert of a change in dynamics.

Tuesday, November 06, 2007

Market Outlook RUT for Nov 6th '07


Dominant TF: 60mins & Daily.
Swings: DN-DN-UP
Market direction: mildly down, looking for support.

60mins: congestion to down.
MTFS and Entropy indicate a possible bottom, but there is still some negative entropy to dissipate in a narrow trading range. RUT may also try to look lower for a stronger support.

Daily: down but support level on 791 is so far holding.
We seem to have a Fib pattern forming, but 791 may not hold very long as MTFS and Entropy look more and more bearish now. One could therefore see RUT going lower to 781 (Fib + MM level).

Weekly: congestion to mildly down
Entropy and MTFS indicate continuation of this situation of congestion with a slight downward 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 Nov 6th '07


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

Like NDX, SPY has closed on a nice round number. Difficulty is that at this point in time, we have no clear indication of direction going forward.

60mins: undetermined.
MTFS is still stitting beareish on a very strong Fib + MM support. With a high significance level, the recovery potential is minimum at best yet Entropy seems to have bottomed. Forthcoming direction is impossible to determined as it can go either way from this key 150 level.

Daily: down, but possible congestion.
Significance level is slowly coming down, indicating we'll have to pay more attention to lower time frames.150 is obviously a difficult level to pass, but we certainly have a negative bias, so SPY may look for a stronger support (Fib?). For the time being, MTFS is not very bearish, hence the lower part of the [150-156] range is still valid.

Weekly: probable congestion - Very low significance level, due to MTFS divergence.
Entropy is looking OK, but MTFS indicates continuation of this situation of congestion with a slight upward bias. Watch for divergence and possible double-top.With such a low significance level, one should rather take cues from lower time frames.

Market Outlook NDX for Nov 6th '07


Dominant TF: 60mins & Daily
Swings: DN-UP-UP
Market direction: still mildly up.

Yesterday's Close is a nice round number, yet there is a lot of indecision in the air.

60mins: Mildly down, congestion.
We've been used to wild swings, so yesterday was calm in comparison. MTFS and Entropy are both indicative of congestion and the 2188 MM level seems to hold. It may provide some strength later on to reach 2250 (potential Fib pattern). It is however far too early now for such scenario.

Daily: Congestion to Up, slow down approaching strong resistance level.
Apart the presence of a yellow bar, nothing much has changed, so NDX should creep up to previous highs, albeit considerably slower in comparison to what we've seen in the last couple of months. The rise may stall, but certainly no strong retracement in sight.

Weekly: congestion to mildly UP - Low significance level.
Entropy is still looking very good, but MTFS has difficulty adapting to such a strong run (U-shape pattern is not closing). 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, but we have to watch how this divergence develops. A peak in Entropy will also be an alert of a change in dynamics.

Sunday, November 04, 2007

Blog Update - Nov 4th '07

1) This blog will be open to all visitors for the next 2 weeks.
After that, access will again be restricted to registered users.

2) Most of the technical side has now been moved to the other ts-trading-technique blog. Users of the TradeStation toolset can send comments or questions. A forum can eventually be set up separately.

3) Please note that there may be an interruption from November 11th to 14th, as there may be no internet readily available where i am going.
I'll confirm later on this week.

Thanks for your interest in this trading technique.

bv

Saturday, November 03, 2007

Market Outlook RUT for Nov 5th '07


Dominant TF: 60mins & Daily.
Swings: DN-DN-UP
Market direction: mildly down, looking for support.

Again, strong correlation sith SPY. Volatile environment.Swings are DN again, indicating we are hovering around a key level.

60mins: congestion to down.
MTFS and Entropy indicate a possible bottom, but there is still some negative entropy to dissipate in a narrow trading range. RUT may also try to look for a stronger support a little lower.

Daily: Congestion with downward bias - trading range.
We seem to have a Fib pattern forming, but 791 could hold as MTFS is congested with a downward bias. Entropy is however pointing down, so one could see RUT going lower to 781 (Fib + MM level).

Weekly: congestion to mildly down
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 Nov 5th '07


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

60mins: congestion to mildly up.
MTFS lines have joined on strong Fib + MM support. Entropy seems to have bottomed but is very low, and the MTFS green line is bearish indicating current recovery may be short-lived. Since the 150 support level is quite strong, congestion is likely.

Daily: down, but possible congestion.
There seems to be a Fib expansion pattern forming, but the MTFS is not very bearish, hence the lower part of the [150-156] range is still valid.

Weekly: probable congestion - Very low significance level, due to MTFS divergence.
Entropy is looking OK, but for the time being MTFS indicates continuation of this situation of congestion with an upward bias. Watch for divergence and possible double-top.

Market Outlook NDX for Nov 5th '07


Dominant TF: 60mins & Daily
Swings: DN-UP-UP
Market direction: still mildly up.

The week ended on a quiet note, and little changed from previous day's snapshots..

60mins: Mildly up, congestion.
As expected, we've had a bounce around 2190. MTFS is in an incomplete V shape pattern indicative of a possible upward bias. The green line has dropped from latest highs. This limits the upward potential in the short term, to ~2220 first.

Daily: Congestion to Up, slow down approaching strong resistance level.
Apart the presence of a yellow bar, nothing much has changed, so NDX should creep up to previous highs, albeit considerably slower in comparison to what we've seen in the last couple of months. The rise may stall, but certainly no strong retracement in sight.

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). 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, but we have to watch how this divergence develops.

Friday, November 02, 2007

Market Outlook RUT for Nov 2nd '07


Dominant TF: 60mins & Daily (15 and 30mins are leading).
Swings: DN-DN-DN
Market direction: mildly down to down.

I have mentioned again and again we were hovering around a key level with Swing indicators oscillating too often. Obviously it is not easy to pinpoint exactly when it will happen with a daily update, and lower intraday time frames have helped a lot.

60mins: Down, looking for support, 797, 781, then...
Resistance at 828, also stall level at lower time frames proved strong enough to halt the bull run. All patterns are now much clearer, and point definitely lower. However, one should not panic yet, and check levels carefully. 797 may hold although it is unlikely. Fib target is 791.

Daily: Congestion with upward bias - trading range.
Yesterday's comments were pretty valid, with however a clearer downward bias. The trading range is: [797-828] within a larger one [781-843].

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

Market Outlook SPY for Nov 2nd '07


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

I have mentioned again and again we were hovering around a key level with Swing indicators oscillating too often. Obviously it is not easy to pinpoint exactly when it will happen with a daily update, and lower intraday time frames have helped a lot.

60mins: looking for support, around 150 first.
The MTFS pattern is now clearer, and should develop until lines join again. It may be lower than 150, but it is not quite visible yet.

Daily: down, but possible congestion.
There seems to be a Fib expansion pattern forming, but the MTFS is not very bearish, hence the [150-156] range is still valid.

Weekly: probable congestion - Very low significance level, due to MTFS divergence.
Entropy is looking OK, but for the time being MTFS indicates continuation of this situation of congestion with an upward bias. Watch for divergence and possible double-top.

Market Outlook NDX for Nov 2nd '07


Dominant TF: 60mins & Daily
Swings: DN-UP-UP
Market direction: still mildly up.

I have mentioned again and again we were hovering around a key level with Swing indicators oscillating too often. Obviously it is not easy to pinpoint exactly when it will happen with a daily update, and lower intraday time frames have helped a lot.

60mins: Down until support is found around 2190 first.
As mentioned yesterday, when there are wild swings particularly after a Fed announcement, lower time frames take the lead, and had a stall level at 2238 which proved quite strong.Profit taking is perfectly in order, and we now have to check for support. MTFS is slightly bearish so there is a chance it goes lower than 2190. No Panic though, as NDX may just gather more strength to reach 2250 later on (possible Fib development).

Daily: Congestion to Up, slow down approaching strong resistance level.
This one-day correction is certainly not alarming yet. There is no indication of a change in trend.

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, but we have to watch how this divergence develops.

Thursday, November 01, 2007

Market Outlook RUT for Nov 1st '07


Dominant TF: 60mins & Daily.
Swings: UP-UP-UP
Market direction: congestion to mildly down.

Again, strong correlation sith SPY. Volatile environment.
Swings are UP again, indicating we are close to a key level.

60mins: Up, but strong resistance level is close.
MTFS and Entropy are undecided with a remaining upward bias. A clearer pattern may emerge once we have tested a resistance level and MTFS lines finally regroup. For the time being, MM resistance level is 828, the next ones being about 15 points apart.

Daily: Congestion with upward bias - 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.