Friday, January 04, 2008

Market Outlook RUT for Jan 4th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from UP-DN-DN)
Cycles: opposite directions and low significance level...
Market Direction: down
Position (60mins):
Short: some may want to hang on, but nothing wrong with taking profits.
Flat: it would be cautious to stay a little longer on the sideline
Long: are we looking at the same chart !!!?!?

60mins: lower, but possible congestion
750 broke late in the day, so check now for support around 734 (MM + recent lows). MTFS is still bearish, but is now close to oversold level.

Daily: same volatile environment.
MTFS now points lower yet since lines crossed end November RUT has followed a 'wavy' move upward, and could eventually bounce again within the same difficult, volatile environment. A bottom must be found first (734?).

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 4th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from UP-DN-DN)
Cycles: possible upturn but very low significance level
Market Direction: probably lower lower still
Short: nothing wrong taking profit around lower 144s
Flat: be patient
Long: very risky

60mins: congestion to possibly lower
As mentioned yesterday, we have early signs of a bottom, but despite the recovery late in the day, it is way too early to go long at this time frame (nothing wrong with a few swing trades at lower time frames though).

Daily: down bias
MTFS is fairly undetermined (with a slight lower bias though). One should be careful is 143.75 is broken. One can notice a triangle pattern.

Weekly: own
Despite the low significance level, one must be careful as we have another triangle pattern (lower highs - higher lows) with a possible breakout coming either way.

Market Outlook NDX for Jan 4th '08

Dominant TF: 60mins & also Daily
Swings: DN-DN-DN (from UP-DN-UP)
Cycles (DomTF): possible upturn - low significance level
Market Direction (Daily): same trading range [2000 - 2125], erosion to 2000 is quite possible
Position (60mins):
Short: hang on
Flat: be patient
Long: consider changing job

We anticipated a slowdown on the way down, yet 2040 is not a major support level, and all 3 Swings are down...

60mins: congestion to lower bias
NDX is still looking for a lower support. Swing went momentarily up yesterday indicating the pause we saw. Indicators are still too bearish to envisage an upturn right now. Despite a recovery late in the day, price erosion may continue to 2032 (next levels down are about 16 points apart).

Daily: same trading range - looking for lower 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: Caution: 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. Breaking 2000 could mean a much lower support level.