Market Update - Oct 1st '09

A bit of traveling again tomorrow so here is an early shorter report which i might update before the open.

One will notice that i was spot on again yesterday with pretty accurate targets... Erosion seems likely to continue for both ES and TF. It is difficult to say right now whether selling will pick up momentum or whether it will aim lower than current range lows (60mins chart). This is a clear "airhole" situation which can lead to temporary hesitation, congestion, and directionless volatility.

EURUSD: very marginal upward bias, and at the same time 1.464 turned to stronger resistance level... This price level can be tested again but EURUSD will likely then drift lower to recent lows.

( posted 10:07 PM UK )

Market Update - Sep 30th '09

ES is for the time being stuck on the key 1062 resistance level. It has since shed a few points but has not clearly retraced yet. We therefore cannot confirm the reversal point we've been waiting for.
We have a provisional Fib pattern with a 1st target on 1046 but no energy to support more than a possible continuation of the current erosion.
TF follows the same path with an immediate target on 604 then maybe 596. The same lack of entropy and MTFS patterns makes it relatively directionless.

EURUSD left key level on 1.464 to drop to 1.453 (MM+Fib) where it bounced. 1.464 remains crucial in the short term and congestion is to be expected until we get a clearer reversal point (at these time frames).

( posted 6:55 AM UK )

Market Update - Sep 29th '09

The bounce was anticipated on the Fib level but definitely stronger than we would have thought, to aim straight back at 1062, key level, now Fib upward retracement level.
We'll therefore watch that price level closely today. We have been telling that the bullishness we've have for a number of weeks is bound to come to an end, even if it can still creep a little higher.
The same situation for TF could take it back to recent highs (check for 614 first) but we have to be careful here too. Buying pressure is still present but could evaporate leading to increasing hesitation and volatility.

EURUSD: watch same key level at 1.464

( posted 6:40 AM UK )

Weekly Report - Sep 28tht to Oct 2nd '09

Market reading went quite well last week. Let's hope we'll have another good week.

ES has sort of landed on Fib level where it could rebound softly. However selling pressure is now definitely there so we could aim lower again around 1030. The overall longer term trend is however still relatively bullish, so a continued period of hesitation is likely. We know that the weekly chart is pointing for a retracement to come but the exact trigger point isn't quite there yet on the daily chart.

TF shows a clearer picture as it has hit its target on 594. It is however still quite bearish. We'll therefore watch that 594 support level closely as it could trigger more selling and induce the retracement the 580s then maybe to around 555 in a couple of weeks. Again, TF has been leading lately, and could take ES down with it.

EURUSD: bearish right now.
The 1.464 is still test level which could be hit again as a resistance during the course of the day. On the downside, we'll check the Fib level around 1.454 but we have not indication of more than a minor retracement on the weekly chart. The trend is firmly up there despite being very overbought right now.

( posted 7:40 AM UK )

Market Update - Sep 25th '09

We now have more clarity about ES going for a soft landing on 1040, or possibly eroding further to around 1030 (our usual 32 price segment from 1062). Again no change in our longer term bullish outlook.

TF has stalled on ... stall level of course, but could well hit 594. As mentioned yesterday, we even aim lower without affecting our long term target much.

EURUSD: We aim at 1.464 for support and possibly then bounce higher. We're in for a bumpy ride anyway...

( posted 8:45 AM UK )

Market Update - Sep 24th '09

We now have evidence of the modest retracement we've been waiting for. Again, I realize the message has been possibly somewhat confusing but the longer term targets remain unchanged.

We also notice that TF is leading the retracement after hitting its target on 625. taking ES down with it (as anticipated). We now have to check a short term support on 609 which could trigger the full on retracement to the 580s, then 560s. Again, longer term players should worry.

EURUSD: some erosion yet one can't call it a fall. The US$ should remain weak over all. We'll check the 1.477 key level for now, which could indicate aiming for 1.465 later on.

( posted late at 9 AM UK )

Market Update - Sep 23rd '09

ES certainly remains bullish. It passed the 1062 test level, so we'll check it stays above it and possibly tests it again as support. In any case, the course seems set to ~1100 (we'll fine tune our target later on).
TF is as so often in the same situation but must pass 620 and then the strong resistance 625 level.
Again we have to realize the VERY overbought configuration we have here, so i wish to reiterate recent warnings that a retracement is bound to happen in the next few days, even if moderate (could however then fall to the low 500s).

EURUSD: should stay high.
We anticipate a return to highs and even 1.486.
Like for indices despite an obvious forthcoming retracement the upward bias is there and we keep our longer term target unchanged.

( Posted 6:20 AM UK )

Market Update - Sep 22nd '09

ES has now stalled on its 1062 resistance level, with hardly any sign of weakening though. It could creep higher but we do expect a reversal soon so long positions must be monitored closely, stops tightened and some profits taken.
TF is in the same situation and while a volatility spike could it to the 620s again, we prepare for a modest Fib retracement in the next week or so (Entropy is very high).

EURUSD: the 1.464 level held yesterday, so €/$ should remain range bound either directionless or with a slightly upward bias to a short term 1.477 resistance level.
As for indices, we anticipate some minor Fib retracement on longer time frames (daily/weekly) within a few weeks even though we keep our 1.50 to 1.51 target for now.

( posted 6:15 AM UK )

NB: tomorrow's report might be delayed

Weekly Report - Sep 21st to Sep 25th '09

While hesistant on 1062 which is a strong resistance on the 60mins chart, ES could push higher even to 1125 over the next couple of weeks. While residual momentum is still there, a retracement is clearly in the cards on the weekly chart but it is impossible to figure out when sellers will actually pull the trigger.
We'll therefore watch the behaviour on Monday on this 1062 level. Should sellers have a go, ES could shed 1.5% to 1050 but it should remain limited at first.

We however notice that TF is more prone to retrace and could take ES down with it. It currently suffers from the same short term hesitation with the same upward bias and the same need to retrace on the weekly chart.

EURUSD: could be range bound in the short term, but still bullish overall. We indeed saw 1.464 acting as a support now on the weekly chart. That level remains key to the continuation of the current rise. A moderate retracement is also necessary here even if it could take a while to exhaust the current buying pressure.

( Posted Sunday 7AM UK )

Market Update - Sep 18th '09

New contract and maybe more signs of hesitation around 1060. The bullish pressure however needs to first dissipate to eventually initiate some selling. Lower time frames will be necessary to pick a reversal point but one can already say that if prices stay below 1062, buyers will probably pull back and let retracement start. Should this happen today, we'll figure out a target on the weekly report.
TF does not provide us with additional information. While it hasn't hit its strong resistance level on 625, stall level (~618) could act the same way.

EURUSD: hesitant as well but could retrace in the short term to yesterday's lows or at least 1.468. Still very bullish overall on daily and weekly charts.


( posted 7 AM UK )

Market Update - Sep 17th '09

Late, shorter report today...

All markets are sitting on strong resistance levels. With triple witching coming, we may see increased volatility but no sign of retracement whatosoever in the short term. Shall we see yet another breakout?
Retracement has to come, more visible on the weekly chart, so it may take at least a few days to materialize.

Traveling right now but will try and update this report by noon Eastern

( posted 10 AM UK )

Market Update - Sep 16th '09

Interesting market action yesterday, with ES pushing higher as expected, and TF moving in concert, breaking 594 to now aim toward 610s. ES could stall on 1055 or maybe go hit its resistance on 1062.
Concerns on weaker underlying forces is more visible on the weekly chart, so, assuming no increased volatility on triple witching, this steady yet excessive bullishness could hold for a while.

EURUSD: The 1.464 level broke technically on intraday charts, but we are still in a resistance area for now. It is so bullish that once resistance has been tested for support, we could see it reaching 1.50 or maybe just above 1.51 over the next few weeks.

( posted 6 AM UK )

Market Update - Sep 15th '09

Previous reports pointed out the residual bullish momentum so one could say that markets behaved as expected.

While we believe there is still some upward potential maybe even to ~1060, we are now in target area, so we'll be watching for a potential pivot point, particularly with triple witching coming in a couple of days.

TF is also in resistance area around 594 but is pushing still. We could see some interesting action. A possible yet unlikely breakout could take prices up one price segment (~16 points) by the end of the week.

EURUSD: on our target and remarkably bullish still. Resistance should hold for now though and since there is no retracement potential in the short term, we could see a bit of fighting on these levels.

( posted 7 AM UK )

Weekly Report - Sep 14th to Sep 18th '09

ES is now showing early signs of exhaustion, but the market remains bullish nonetheless (cf. snapshot posted on the ATT blog). We know that we've been hovering in a resistance area for a while, and while there is still some potential for a higher target, a retracement will be necessary as underlying energy is weakening. Such profit taking could take place this week.

TF is obviously very much correlated, but is already weaker on pivot level (~592). It could retrace to the high 570s.

EURUSD was also inches away from our target (1.462) and strong resistance level around 1.464. Retracement to the 1.45 area is engaged but support could be found on a Fib level the short term. The weekly chart remains mildly bullish.

( posted 7:10 AM UK )

Market Update - Sep 11th '09

As mentioned in previous reports, the bullish bias is still there for now. Only longer time frames seem to indicate possible exhaustion in a few weeks. A retracement will be then necessary but we have ample time to review our scenario. In the short term we keep a target for ES in the mid to high 1040s.

TF needs to hit its resistance on 592 but could certainly go higher later on. Triple witching coming next week, so the market could pause first.

EURUSD: on its way to 1.464. Short term bullishness but some limited retracement is in the cards (1st Fib level), so we'll watch for a possible stall as well (weekly chart).

( posted 7:40 AM UK )

Market Update - Sep 10th '09

Scenarios always have to be refined as we go along, this is why i often propose to adjust positions.

Today, we see ES back to the top of its trading range around 1032 with a little more energy lately. If current highs are broken, the probability of it going higher still is strong particularly on intraday tick charts. Having said that, we have another set of resistance just below 1050 (half a price segment, Fib etc) and underlying force coming from longer term indicators remains weak. In other words, we have to remain careful of the market stalling at some point.

TF is also aiming to ~593 with the same possibility of stall.
Again we do have a reassuring longer term upward bias, but a retracement is possible along the way, hence we'll keep watching this market...

EURUSD: on stall level on 1.458 and probably aiming to its strong resistance level around 1.462 to 1.464. As mentioned in previous report, we have noticed a (spurrious) correlation with indices, and while the upward bias is certainly there, EURUSD is definetly entering overbought zone where a retracement would be healthy.

( posted 7:20 AM UK )

Market Update - Sep 9th '09

ES hovered around the mid 1020s as anticipated yesterday. Again the residual upward bias is there, but lower time frames point toward some retracement later on. The air hole effect can carry on for over a day. If retracement starts, we'll have a 1009 target. No change of scenario on longer time frames.

TF is also losing steam close to the 578 target (60min chart). There is no sign of retracement here though. Both indices may have to fight their respective resistance levels first to retrace (1032 for ES). However both are sitting on their stall level just below targets with little energy left.

EURUSD: still bullish. If you read earlier reports, you may have noticed a target close to Dec 08 highs (1.462 to be exact) if 1.44 was broken. EURUSD is overbought but could give it a go again within a week. It has however hit stall level already which is often good enough to take profits or tighten stops at least.

( posted 6:25 AM UK )

Market Update - Sep 8th '09

ES stalled in the low 1020s as expected but contains enough momentum to stop attempts to retrace. It should therefore keep hovering in the same price range. In the most optimistic scenario, it may try and reach range highs, but looks relatively unclear still at this time (~3AM Eastern).

TF could go a little higher (~575), where it could pause.
Both indices look fairly bullish but lack energy.


We note that EURUSD has reached a strong resistance around 1.44 where it should also pause. Like our indices (remarkably correlated lately), EURUSD has some residual upward momentum.

( posted 8:25 AM UK )

Weekly Report - Sep 7th to Sep 11th '09

ES proved to be a bit more bullish than anticipated on Friday. The first resistance indeed broke easily to see prices settle just below 1020.
At this point, it isn't clear how far ES can go now. There is some indication of stalling in the low to mid 1020s. However, this last test of 1000 bodes well for a higher target even if energy is lacking to support the current buying spree. We may therefore see a continuation of the same trading range on the daily chart with a slight upper bias in the long run.

TF is also looking bullish right now. We'll watch resistance around 570 and 575 as the underlying trend (like ES) is pretty weak still.

EURUSD: Current resistance in on current highs around 1.434. It should eventually go higher, but is definitely lacking stamina (like indices...)


( Posted 9 AM UK )

Market Update - Sep 4th '09

Support was found yesterday in the low 990s but 1000 is certainly still acting as a mild resistance. This is definitely more a time of hesitation that a real tug-of-war on a salient level.

ES could reach 1008 but is lacking both direction and energy, and this long weekend will probably not help as volumes should remain light until next week.

TF is also hesitant, and while it could reach 566 (Fib), signs of erosion to 544 are still there.

I understand this market update may be a little confusing for some, but short positions should see their stops tightened a bit above Fib levels for now until we get more clarity. Intraday positions should be monitored more agressively, or simply closed until next week when volume picks up again.

( posted 7 AM UK )

Market Update - Sep 3rd '09

Selling pressure hasn't abated yet, so we should see a continuation of the current erosion under the 1000 level. Support should however be found shortly, either on current levels or after dropping to the [968-980] range.
Short intraday time frames seem to indicate 1000 as a mild resistance now on the 60mins chart.

TF can likewise find support on current lows or could also shed another 10 points. Therefore, even though the longer weekly outlook is still fairly bullish, support could be first found on the daily Fib 38% level. We'll review this on the weekly report.

Note on EURUSD: the bounce on 1.418 has stalled for now on pivot level hence some hesitation on current levels (~1.428). Although pivot may act as a resistance for now (60mins chart), it will probably be broken later on (higher time frames).


( posted 6:30 AM UK )

Market Update - Sep 2nd '09

Didn't i see it coming... ? We had that typical "air hole" configuration which translated in a sudden fall which i thought would be limited to 16 points.
Es instead shed the full size of the current trading range.
It is not an error of the model per se, but simply the same difficulty to gauge to which extent volatility will compress time. ES had to come back to 1000. It could have been anytime this week.

Now the trouble is that indicators have obviously been fairly bearish all day on the 60mins chart, only mitigated slightly by very very light trading after hours. ES should therefore remain low until all bearish pressure is dissipated. The 1000 level will probably hold (intraday levels show a support [996-1000] range) although it has now been traversed several times hence has lost some of its strength, and we cannot discard the equiprobable chance of a breakout ( for another 32 points ??).

1000 is obvously a key level, and the bottomline is that there is still some bearishness to evacuate either through a price drop or passage of time.

We have to note however that again TF is considerably more bearish than ES and could settle below 550 if ES doesn't hold its current 1000 support level.

Longer term outlook remains unchanged. This is at this point only normal profit taking after the "irrational exuberance" since March.

( posted 7 AM UK )

Market Update - Sep 1st '09

The good thing is in times of turbulences is to be able to count on at least a few invariants. One is the 32 point price segment (itself subdivided in sub segments of 8 and 16 points) we've seen on ES for a very long time.
So, even abrupt "air holes" convert into price moves we could call quantum leaps.
ES shed about 16 points in a couple of days to find support around 1016 and is now bouncing up to 1024. What a coincidence...
We can also draw a parallel approach using Fibonacci.

Now the short term hesitation is still there and passing 1024 may be a little difficult but the true test is around 1029 to 1032.
As mentioned in previous reports, one cannot discard the necessity to retrace lower to 1000 to gather strength. Over the longer term, even if ES is now lacking stamina (Entropy is fading), the outlook is still modestly bullish.

We note that TF is also bullish over the longer term but is more bearish in the short term. Therefore the overnight bounce on ES may be short-lived. Salient levels will be checked carefully.

( posted 7 AM UK )