Friday, December 21, 2007

Market Outlook RUT for Dec 21st '07

Market Outlook SPY for Dec 21st '07

Market Outlook NDX for Dec 21th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - poor fit - low significance level
Market Direction:

As a reminder: market direction above is always based on the daily time frame, even if 60mins is the dominant time frame.
We have to accept in such case that the daily time frame may be more difficult to read.
Secondly, provided direction is given for 3 to 5 bars, sometimes more. On the 60 mins chart, a change in dynamics may occur during the course of the day.
Users will obviously adapt to dominant time frames at the time (5 and 10 mins yesterday)

60mins: up
Fib PR1 near 2060 passed late in the day, but it is probably an effect typical of witching days. It will go higher to the next level: 2074 or even 2090.

Daily: congestion to down
Despite yesterday's up day, we shall remain cautius it could be short-lived. The 60mins chart is certainly more significant (91%) but at 77% the down pressure expressed by MTFS and Entropy cannot be discarded.
Opposing situation should in the short term favour the 60mins chart which is the dominant time frame, but congestion is likely at this time frame.
NB: One can again notice an MM octave (i.e. 8 sublevels between 2000 and 2125), so levels will be marked at 2031 and 2062 and 2093.

Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX has touched and bounced from the lower part of its channel, but the weekly bar is still red. Caution should be exercised at these levels. We would be in trouble if 2000 would break...