Market Outlook SPY for Dec 12th '07

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

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

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

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

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