Market Outlook NDX for Feb 7th '08

Dominant TF: 60mins
Swings: DN-DN-DN
Market Direction (Daily): congestion with upper bias
Position (60mins): to be on the safe side, would take profits, but otherwise short. Keeping a few call spreads is always a good idea. The more adventurous will place put spreads in the low 1600s.

The rate cut is history now, and the market has resumed its course...

NB: NO SNAPSHOT TOMORROW

60mins: bearish, but strong support level
MTFS lines are still a little bearish so is Entropy which is low and not showing signes of recovery yet. 1750 is a strong support level though, so even if one cannot anticipate clearly the amount of fighting for this level, there is no strong indication it will break at least over the next day or so, even if it can be momentarily penetrated.

Daily: support confirmed but...
OK, the scenario has been described over and over, and we're there now testing 1750 again. The level is now weaker than a few days ago, indicating NDX could go much lower. For the time being, one should not read more than it is visible from the chart and Entropy while not great is not very low. So the level is likely to be fought, and there could be some congestion at this low level over the next few days.

Weekly: bearish
Indeed no reason to be optimistic here. One shall check MM and Fib levels carefully. Do not discard that there is always a chance that 1750 will hold. It is the last defense line before we enter a bear market... Next support level would be 1640.