Monday, December 17, 2007

Market Outlook RUT for Dec 17th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-DN-DN (from DN-UP-DN)
Cycles: up - good fit
Market Direction: congestion with a lower bias

Like for NDX and SPY, it is likely that the next support level (750) will be key to forthcoming direction.

60 mins: Support level may have to be found lower
MTFS points lower and Entropy is stable, indicating continuation of price erosion. One should obviously pay attention at RUT's behaviour on 750, but like for other symbols, we're not in a situtation of a potential stronger rebound. RUT could therefore remain congested in the low 750s, or even try and test previous lows around 740.

daily: congestion.
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. IT is likely that these [740-750] levels will be be fought, and who knows whether bears or bulls will win. At the moment, only the cycle indicator points up, and we know it is not always a reliable predictor.

weekly: Directionless with a lower bias for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias.
The weekly bar surprisingly did not end up turning red. Again behaviour on 750 will be key.

Market Outlook SPY for Dec 17th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-DN-UP (from DN-UP-UP)
Cycles: up - good fit
Market Direction: No change in overall direction just yet, but a support must be found soon

Fairly good quality cycles on daily chart pointup upward in the short to medium term.

60mins: Lower bias, check behaviour on 147.
SPY started the day directionless but the 147 level acted as an attractor. There isn't much negative energy so no reason to believe it will go much lower at this point in time.
The trading range should remain in the lower part of [147-150].

Daily: slightly up after support is found shortly.
MTFS white line is showing signs of weakness and Entropy has now peaked. We have to watch for Fib support levels (146.8, then possible 145.3). SPY could well stay congested within a [147-153] trading range.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 17th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low significance level
Market Direction:
Congestion with a lower bias at first.
Will support be found on 2062 ??

60mins: congestion to lower bias.
Like for RUT and SPY, NDX will have to test the next 2062 support level (Fib + MM) but should there some acceleration on the down side, NDX being generally quite volatile, a support around 2050 is also possible.
For the time being, one should not try and read what is not in the prices yet, and congestion with continuation of this drifting situation is a more likely scenario.

Daily: moderately lower
MTFS and Entropy are slowing down further, so some NDX will continue drifting until the next support level. Note that there is no negative energy just yet, so this is not a reversal situation.

Weekly: congested to lower bias.
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.