Wednesday, January 30, 2008

Market Snapshot for RUT - Jan 30th 2008

Market Snapshot for SPY - Jan 30th 2008

Take cues from NDX post below.

Market Outlook NDX for Jan 30th '08

Dominant TF: Daily
Swings: UP-DN-DN
Cycles (DomTF): pointing down, but somewhat unreliable in this market
Market Direction (Daily): congestion
Position (60mins): flat, however selling 2150 call spreads is still a very conservative bet, Feb 2000 is pretty safe too

Market is relatively quiet now ahead of Fed meeting, so we're just going to read what the charts have to tell us at this time, knowing martlet is full of surprises. Having said that, if i were to bet on a reaction to the announcement at the end of the week, i would certainly have a short bias.

60mins: congestion with a remaining slight upward bias.
MTFS lines are about flat in median territory, so is Entropy, and not help from levels.
Technically the Swing is UP, but can NDX really creep up to 1880? New energy is needed and it can only come from an exogenous source like a reaction to a rate cut or absence of it. Answer in a few days...

Daily: support confirmed but...
Hardly any change since last report:
While we certainly have Entropy coming up, MTFS has not shown the best looking line crossover, and Entropy is only picking up slightly from its recent lows. Again, this is not the easiest scenario, but i would anticipate continuation of the congestion... with a possibility to go much lower if some new recession news spook the market, or if the Fed doesn't act soon.

Weekly: definite down bias still
No panic, but 1750 could be tested again, or at least congestion in the lower part of the trading range may happen. One can notice that 2000 technically never broke as a strong resistance level even if it appeared broken during 4th quarter 2007, and on the contrary, support level dropped!
So are we bearish? hmmm VERY cautious at least, i would say.