Market Update - Oct 29th '09

Market reading has been quite easy lately, and many traders must be smiling ear to ear... ES is now on the 60mins stall level and still looking a little bearish.
The early MTFS crossover is a classic example of a stall which may translate in a soft landing in the low to mid 1030s.
We shall notice again and again our 32 points segments. If this one breaks, we might head onto 1000 again.
The Entropy is very low (EntBin=-5) so a bounce is more than likely, however selling pressure is still too strong in the first hours of the day.
On the daily chart, we notice the channel boundary, the Fib level and a lot of bearishness, so we'll certainly have to check for a breakout.
TF is also coincidentally on a strong support level on both 60mins and daily charts. It is therefore in bounce territory when the selling pressure fades a bit.

EURUSD: on stall level as well (60mins), on the channel low boundary (daily), so a lot in common with our indices. At this point in time while the € could drift a little further, we know that the retracement is bound to be limited (weekly chart) hence we first have to analyse the price behaviour on this stall level (1.471) and on or near strong support level (1.464)

( posted 5AM UK )

Market Update - Oct 28th '09

ES is really struggling with the current support level, and should sink further today. We have a MTFS early crossover forming which could mean an unconvincing attempt to hold or even bounce a tiny bit, but we should rather look at channel bottom on the daily chart, in accordance to Fib retracement levels.

If we look for some confirmation from TF, it is clear that it is aiming for range lows and stall level in the mid to high 570s.
The pullback could later on take prices further down.

EURUSD: very modest bounce on support level, which is also a channel boundary on the daily chart. Traders will try and keep it above the 1.477 support level, but negative pressure is certainly there still and profit taking could continue to the 1.464 area (to be confirmed).

( posted 6:30 AM UK )

Market Update - Oct 27th '09

ES fell to the support level after breaking out. We had anticipated it as prices stayed below the key pivot level and selling pressure accelerated. ES should remain fairly bearish, yet 1062 should hold and a minor bounce is even possible at first.
As mentioned on the weekly report, the current support level will determine whether prices will fall to the next price segment or not. It is unclear whether this will happen today or not... but it could in the next few days.

TF is also sitting on its strong support level, and since it is a also strong Fib level, a bounce is likely. However, like for ES, we should start preparing for a pullback to the low 500s.

EURUSD: we'll check for a channel bottom as we still don't see any major retracement coming. Short term bearish for now.

( posted late 10h30 AM UK )

Weekly Report - Oct 26h to 30th '09

ES has taken a bit of a knock on Friday, but one should not jump into conclusions of the "big one" just yet. It is only normal profit taking at this stage. Indicators on the 60mins chart do show a bounce potential, but 1078 will be key level. If prices stay below it, we can safely assume ES has moved to the lower price segment and will aim at 1062. That level if/when hit will be a lot more crucial going forward.

TF is also in soft landing mode on stall level just below 600, and could later drift to the strong support level (~594). Longer time frames also show that retracement target as key support which could trigger substantial selling pressure. Although a major retracement is due, we cannot say with any sort of accuracy whether the timing is right. We have all noticed a sort of double top and a return to the [500-513] range is in the cards, but we'll need to update our scenario as we go along (triple top ??)

EURUSD: we notice some exhaustion of the Euro, and a narrowing of the range which could lead to a breakout situation this week. The US$ should remain weak in the short term, and a lower time frame is recommended. We'll check 1.502 for support.

( posted hastily 6:10 AM UK ... will try and give an update around noon)

Market Update - Oct 23rd '09

ES has been oscillating in a same trading range for about a week now. It is still trying to push higher, and one cannot discard the possibility of a last breakout to the next price segment (~32 points to 1125). I personally think we'll have to go through at least another round of oscillations in the current trading range.

TF is also a little volatile. It is currently sitting on the Fib2 level in the mid 610s, with a bit of buying pressure prior to the open. TF has been leading the retracement so far and since we know a pullback is in the cards, we'll watch the market action carefully. TF must indeed at least pass recent highs and even breakout 625 to escape from the erosion scenario which could accumulate some momentum later on.

EURUSD follows the same path of indecision on target level (stall level to be exact), otherwise nothing new really. Correlation with indices is high. Profit taking to be expected soon, but really nothing major... The US$ has lost all its shine, and this situation should last at least a few months months.

( Posted late, thanks to Blogger.com being down for a while, 9:30 AM UK )

Market Update - Oct 22nd '09

Yesterday's market action was a little too abrupt for our time frames and i hope you have switched to lower time frames as recommended recently.

1094 is indeed a strong resistance, only a few points away from a Fib target on the daily chart so it is a good price area for the "air hole" also mentioned in recent reports.

Having said that, on our time frames at least, we don't see the potential for a the big retracement just yet. We believe prices should drop again today to the low 1070s, but should bounce relatively soon (Check 30mins time frame or lower).

TF has been showing the way south and pulled back a little more markedly. It hit stall level just below 600 and could even reached support level on 594. Selling pressure is however not as strong as one could imagine, so yesterday's dip does not preclude a sizeable retracement here either. At least for now...

EURUSD: nothing new really. €/$ has hit a target on stall level and has the potential to go a little higher still but is certainly more hesitant now. It might have a go at it after gathering strength near range lows around 1.49

( posted 7:30 AM UK )

Market Update - Oct 21st '09

Sorry about yesterday... Could not find a minute to connect.

ES is finding it difficult on 1094 but it isn't clear yet whether this is the signal for the pullback we've been waiting for. Prices should indeed hover around current levels, and test resistance again. We shouldn't be too far from the peak now so i again recommend moving to lower time frames.

TF has already retraced a bit to 610 where a bounce is likely. Same period of hesitation otherwise, so caution must be equally be exercised at these levels, even if we don't anticipate any strong pullback in the short term.

EURUSD has hit the target we had on MM stall level. We also notice that the retracement potential on the longer term (weekly) is fading, hence only minor profit taking could slightly affect the current bullishness in the couple of weeks or so. Passing stall level and then the strong 1.51 resistance should prove difficult though, so we'll update our scenario as we get close to target.

( posted late 8:25 AM UK )

ES has reached the 092 target we gave last week to retrace to mid-resistance level (high way to pivot level). It is now even more hesitant, and even though higher time frames still point to a new target close to 1125, we have to remain cautious about significance level on the MTFS which is dropping fast, indicating we should pay more attention to a lower intraday time frame. We'll therefore first check whether the [1076-1080] support range holds on Monday morning, as it could trigger selling to the 1060s.

TF is also hesitant, losing a little bit of ground without any selling pressure. Erosion could continue to 610 first, maybe 604 later on. We'll have to update this over the next few days, as a If selling doesn't pick up momentum, a congestion period could last for a while.

EURUSD: Quite resilient, it is testing Fib/MM level around 1.486 to 1.489 for now, and could lose a bit of ground to 1.48. Like for indices, selling pressure is pretty mild still, so we may see some congestion, trading range and even our target being hit still.


That's all for now... We'll try and be a little more definite over the next few days. On account of traveling, Tuesday's report shall however unfortunately be posted late.

( Sunday 11:40 AM UK )

Market Update - Oct 16th '09

ES is now on its resistance level on the 60mins chart, and looks still bullish... As mentioned in previous reports ES is aiming to 1125 or at least to the stall level just below.
We're anxious to see whether that will be the retracement point we're looking for.
TF is also bullish, close to the 625 resistance level but while also looking bullish right now, looks like having less upward potential. We can expect some fighting on current levels, and can't discard a volatility spike in either direction.

EURUSD seems to be following indices, in a catch 22 situation like for gold, offsetting returns in Euros terms. EURUSD is more hesitant now, but should remain bullish if it stays above 1.489
Stall level is on 1.498 with the strong resistance on 1.501, this is an area where we should see that anticipated exhaustion and likely modest retracement.

( posted 6:40 AM UK )

Market Update - Oct 15th '09

Sometimes chart reading is easier, particularly in momentum mode when "quantum" levels are visible.
ES is now very close to the 1094 resistance level, and residual bullishness should support ES moving higher again.
TF which was slightly ahead of ES is now more in sync, and is also inches away from the 625 resistance level, which could prove a lot harder to break.

EURUSD: same story... €/$ should hit stall level and probably resistance level around 1.5 later on. While going with the flow, one should always remain cautious about the apparently obvious though.
One can't discard the possibility of a sudden bout of selling on target.

( posted 7:50 AM UK )

Market Update - Oct 14th '09

ES keeps on rising relentlessly... hesitation on highs has now faded so we can expect it to reach 1085 today (maybe 1093).
I know i probably confused some readers with my retracement warning on the weekly chart: yes, it is still there, charts are clearly overbought, but the momentum effect is too strong in the short term.
TF is now loading correctly again here. It is moving along with ES and should aim for the stall level or maybe right to the resistance level on 625.
Again, we have to realize that the retracement scenario is a little more advanced here than on ES hence TF could lead the forthcoming retracement (next week?). We'll come back to it in due course.

EURUSD: US$ is very weak and despite being on a target now (1.489), resistance level could break hence we could hit our longer term target (just above 1.50) earlier than we thought.

( posted 7:15 AM UK )

Market Update - Oct 13th '09

ES is now testing september highs with some hesitation. It isn't clear whether it will stall now in the short term, but it is probably too early to assume the timing is right for the retracement announced on longer time frames for some time. ES will probably try and creep higher, maybe up to the next Fib/MM level around 1125.
The dominant time frame being the 60mins chart, we'll remain obviously quite cautious.

TF hit stall level yesterday. This can explain the current exhaustion, but 625 is just around the corner now and should be tested still. We do notice that TF is definitely closer to the anticipated retracement.

EURUSD: key level 1.477 could determine some retracement if broken but this is unlikely. Current hesitation is quite normal but we still aim higher in the longer term around 1.50 to 1.51

( posted 8 AM UK )