Market Outlook NDX for Jun 9th '08

Dominant TF: 60mins and daily (lower intraday TFs also)
Swings: DN-DN-UP (from DN-DN-UP)
Position (60mins): short
Market Direction (Daily): congestion - trading range

A lot of volatility lately, hence my recommendation to move to lower time frames in my last NDX post. Again, directional traders are recommended to switch to lower time frames. Nothing wrong with staying on the side line either until the picture gets clearer.

60mins: lower, but beware of spurrious volatility
MTFS is obviously bearish, so is Entropy. NDX is likely to hit recent lows again (~1980) where it will hopefully find support... NDX could actually fall further (stall level ~1955, and strong support at 1938).
We will again follow EURUSD and oil prices for clues on direction and levels.

Daily: congestion to possible channel breakout on the downside
No major change from last NDX post: NDX is in a congestion phase with a remaining slight upward bias. We will also be cautious about this indecision by checking channel lows. In case of a breakout, NDX could find support near 1950, i.e. close to possible support levels found on the 60mins chart. Since NDX could also bounce, we will remain cautious or switch to lower time frames.

Weekly: Congestion at key level, upper bias remaining.
No major change at this level:
The Fib/MM levels (2000-2021) have been slowing down the seemingly irresistible ascension back to former highs. MTFS is still somewhat bullish and Entropy has not peaked yet. NDX may eventually keep hovering in a [1950:2050] range for a while, but until MTFS and Entropy actually confirm the slowdown, we will assume a "cautious" positive bias going forward.
Again, i wish to emphacise this is a key level as Fib patterns can develop both ways here, even if a downturn definitely looks unlikely.
Pivot number 3 (2050) could indeed turn into a full downward Fib pattern (target 1700), or could still be erased to take NDX back to last year's highs (>2200). Again the cautiously bullish scenario is still favoured for now and confirmation should come within weeks. Since this is not the dominant time frames, clues will certainly arise from lower time frame indicators.