Market Update - Jun 17th '09

Markets behaved as expected yesterday with ES hitting target on 906 and TF on 500. A momentary bounce is possible in the short term and one cannot forget that this is only healthy profit-taking on the daily chart.
These levels are strong support levels on both time frames so we probably just have to exhaust the current selling pressure. One cannot discard the possibility of this level being broken and lose another 5% or so (quite a likely scenario actually).
Again no reason to believe that this is anything more than a normal pause to gather strength and attack the 1000 level.

TF follows the exact same route now (short term bounce), and will probably break 500 to fall back into the lower price segment (468 to 500) to then aim at the 600 levels. Could take a while though...

( posted 7:30 AM UK )

Market Update - Jun 16th '09

We were right in anticipating "turbulences" and watch out for that key 937 level. I thought the low 920s would hold, but ES might actually drift slowly further to 906 now.

Likewise, TF will probably test 500 later on this week, even if it could also rise to 515 first. TF indeed certainly indicates clearly that buying pressure is dissipating a little in the short term, while being now in a [500-516] price segment, i.e. one step down from the previous [516-531] trading range.

On the longer term markets are probably just looking for a base to attack 1000 for ES and 600 to 625 for TF, so again, one should expect a major reversal here.

( posted 7:40 AM UK )

Weekly Report ES & TF - Jun 15th to 19th '09

The market again showed remarkable resilience last week. ES tested the 950s as expected only to retrace to the 937 area which still acts as a pivot level.

We're coming close to the end of the ESM09 contract which has been quite bullish since March. Both 60min charts on ES and TF show low SQ (swing quality) level hence, one chould take cues from the daily chart and eventually trade a lower time frame (< 30 mins).

The daily chart is again clearly overbought and bullish, indicating some turbulences and possibly some retracement ahead of the stall level (high 960s). Such bullishness and forthcoming turbulences are also particularly visible on the Daily MTFS with the white line crossing the green line. As described many times on the TS-T-T blog, this is called a "early crossover" which can hardly stop ES from marching ahead to the otherwise overly anticipated 1000 level. We'll therefore watch out cautiously the stall level first (~968), and a likely retracement back to the low 920s, which is a Fib retracement level on the daily chart and the low of the trading range on the 60mins chart.

In the very short term, Friday's bounce on the 937 pivot level is also a a sign for a higher support level, which means that any retracement potential should remain minimal. We'll notice a Fib retracement level in the low 920s which coincide with lows of the trading range on the 60mins chart. We certainly can't discard some substantial volatility on triple witching week so we'll watch out for this key level to see which scenario develops (968 or 920 ?).

Lastly, if we take a look at TF for possible discordances, we do notice that the daily chart has reached its first Fib target level which could trigger some selling to now test the 500 level for support. No such sign in the short term though, so again, we'll need to update our scenario as we get closer to futures and options expiration.

( posted Sunday 11 AM UK, updated Monday 6:50 AM UK )

Market Update - Jun 12th

Quick note (n between flights at the airport) just to say that we may have a retracement point now that we've reached the 950s level. Check Fib levels from current highs, but do not expect a retracement below 875 unless this new emerging pattern is confirmed.

More to come this weekend.


( posted late 4PM UK )

Market Update - Jun 11th '09

Is it really worth writing a few lines today... ?
We see that same continuation of the trading range we've seen for about a week, with a potential breakout to the next price segment. We would then have a target in the high 960s. We also notice a reduction of the price range on the daily chart, confiming that any retracement would probably be limited. Again, the whole point is to know where and when this bull run will stop. Short term call spreads just above 1000 are pretty safe.

TF again shows more resistance in the 530s across time frames. Again, one might see TF reaching the 600 while ES goes to 1000 later one, but how long can the market sustain that same weak to moderate bullishness ? Put spreads are certainly however quite safe too...

( Posted 8AM UK )


NOTE: I will try and post a report tomorrow in between flights, even though one should not expect any "shock in the system" (some economic news today still...). As mentioned above, markets should just creep a little higher, so tomorrow's report may not be needed after all.

Market Update - Jun 10th '09

Same trading range and same hesitation with that same underlying bullishness. ES levels have now moved up one notch, with a target around 950 to 953. We're still unsure whether we'll see the market give a go at 1000 before retracing. The daily chart indeed tends to suggest a pause if not a retracement once range highs are hit again.

TF could be aiming back at range highs but shows even less inclination to go straight to the 600. A retracement is quite likely to gather forces for the assault of the 600 / 625 levels.

( posted 8 AM UK )

Market Update - Jun 9th '09

Market is still very much hesitant. We've seen ES almost testing range lows as mentioned yesterday, but finally still hovering around that same key 937 level. A breakout is possible, which would postpone the otherwise necessary retracement. Again the daily chart is still very pushy, so shall we see the market jump to the next price segment ?

TF is again somewhat less bullish right now, but longer term traders can safely aim for a higher price target.

( posted 6:45 AM UK )

Weekly Report ER & TF - Jun 8th to 12th '09

ES has been hovering on the Daily stall level for about the entire week, and is probably looking for direction now. Market participants will now have to decide to pause or attack the almighty 1000 level.

The 60mins chart is certainly looking at retracing on the 937.5 resistance level yet shows a LOT of resilience hence could remain overbought and rangy for a while. We will however check range lows on 920 (short term) and eventually 905 (mid term).

Again the daily chart is still VERY bullish so a prefered longer term scenario would be a testing of 1000 then a retracement to 875 (we'll check Fib/MM by then).


TF is again a little out of synch regarding levels, and is now a little less bullish than ES also. This is why we still can't discard a test of the 500 level again before aiming on 600 / 625. This short term pullback may coincide with a testing of range lows on ES.

Those who entered long early (weekly chart) have no reason to worry but can maybe tighten stops a bit in case of turbulences.


( posted Monday 9 AM UK )

Market Update - Jun 5th '09

ES is still overbought and bullish, stuck on the 937.5 level, last obstacle to the 1000 level. While a retracement is still possible, a breakout on the up side is now more probable.
The question now is: Shall we see that 937 pivot level being tested as a new support to go higher ?

TF shows a little more resistance, maybe adding a little more pressure leading potentially to that same breakout above 531. That is also our (updated) scenario now, even if a resistance level always remains a resistance level until broken (am i not soooo good at stating the obvious....)

( posted 7:30 AM UK )

Market Update - Jun 4th '09

Sorry for yesterday. I just couldn't get back up to speed in a matter of a few hours. South Africa is a strange place where people live like there is no tomorrow, and where crime is rampant. So, one just gets organized, have everything insured, make sure the neighbourhood is security-patrolled, and then life goes on, like nothing ever happened... What a wonderful world this is...


Anyway, back to work:

ES (60mins) retraced to bounce on Fib Pr1 and MM level. 937 is still pretty strong and actually is a stall level at daily level. Is this going to be the signal for the awaited retracement ? Difficult to say. As always, we want to avoid reading too much "between the bars" so we'll check the 937 level carefully.

Same story on TF. As mentioned previously, we had to realize that markets had to align and 531 is now the key level here. No reason to be contrarian though. Let's go with the flow for the time being, even if a "air hole" starts showing on the daily chart.

More details on the next weekly report.

( posted 8 AM UK )

Welcome to SOUTH AFRICA

My PC was stolen last night, in this wonderful city of Cape Town, SOUTH AFRICA.
I'll try to refrain expressing my views on this country today to avoid being banned for life by Blogger.com ....

I'm going to try and get a backup PC going some time today.
At best, today's report will be quite late.

Market update - Jun 2nd '09

ES and TF indeed broke out on the upside, ES reaching the top of the trading range in a quantum leap we've discussed before. TF understandably "heavier", went the same way, but was stopped on stall level.

A moderate retracement is possible at this level since 937 is a strong resistance level on both the 60mins and Daily charts. Markets are very bullish and overbought but a retracement from highs is likely to be limited and possibly test the low 920s (previous highs of the trading range which just broke out).

TF paused on stall level but shows little inclination to retrace still. Difficult to say whether it will attempt to reach 530 or gather forces on Fib PR1 just above 500, but there is probably enough momentum left in the market to aim a little higher.

( posted 7:30 AM UK )