Thursday, January 03, 2008

Market Outlook NDX for Jan 3rd '08

Dominant TF: 60mins & also Daily
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning down - low to average significance level
Market Direction: same trading range [2000 - 2125], erosion to 2000 is quite possible
Short: hang on
Flat: be patient
Long: go get a tissue

Happy New Year to all!!
I'm sure you haven't missed my snapshots over the festive season, as the market was quite easy to read. We have seen mostly red bars on the dominant 60mins time frame, until NDX reached Fib PR1. Now what's next? We have closed 2007 on a soft landing on a predictable level. Price erosion is still there and we may have no serious support before 2016, or maybe even 2000.

60mins: lower bias
NDX is looking for a lower support. The Swing is momentarily up, which could indicate a pause or a slower fall, but MTFS is still quite bearish.
Look for support on 2016 (stall level) or even 2000.

Daily: same trading range since November - looking for support around 2000
No clear directional pattern despite good significance level.
Non-directional traders can take advantage of this market configuration (lower bias, and support likely to hold at this stage).

Weekly: Check channel's lower boundary
Significance level is too low to pay attention to MTFS, and to this time frame in general. Yet, one shall keep an eye on the channel lower boundary currently around 2030.

Market Outlook RUT for Jan 3rd '08

Dominant TF: 60mins & Daily
Swings: UP-DN-DN (from DN-DN-DN)
Cycles: possible yet still unconvincing upturn
Market Direction: probably lower at first - 750 is key level
Position: bears may want to look at an exit point

If not currently in the market, it would be cautious to stay a little longer on the sideline.

(sorry again for delayed posting...)

60mins: lower, but possible congestion
Definite lower bias, but 750 is a strong level which be fought.
Caution must be exercised with this late up swing, even if this is a very early indicator.

Daily: same volatile environment.
MTFS now points lower yet since lines crossed end November RUT has followed a 'wavy' move upward, and could bounce this time again, within the same difficult, volatile environment.

Weekly: lower bias
Not looking good, but MTFS green line is holding fairly high so one can anticipate 750 to hold for now.

Market Outlook SPY for Jan 3rd '08

Dominant TF: 60mins & Daily
Swings: UP-DN-DN (from DN-UP-DN)
Cycles: upturn but low significance level
Market Direction: probably lower but difficult to determine
Short: hang on
Flat: be patient
Long: risky

(sorry for this delayed posting)

60mins: congestion to possibly lower
Retracement has about reached its target around 144, so could bounce a bit at this level. However, the bias is certainly down still (MTFS + Entropy).
The Swing indicator is usually very early, and maybe too early. One should be cautious and definitely wait for some confirmation of recovery.

Daily: a bit of patience is required
MTFS is fairly undetermined (with a slight lower bias though). One should be careful is 143.75 is broken

Despite the low significance level, one must be careful as we have a triangle pattern with a possible breakout coming either way.