Monday, February 18, 2008

Market Snapshot for RUT - Feb 19th 2008

cf. SPY post below

Market Snapshot for SPY - Feb 19th 2008

cf. SPY post below

Market Outlook SPY for Feb 19th '08

Dominant TF: 60mins, with Daily weakening
Swings: DN-DN-DN
Market Direction: possible pause or price erosion in the short to medium term. Testing 125 or stall level at high 120s is more than likely.

No major change since last SPY post. SPY went up a little, down a little, and remains directionless in the short term.

60mins: congestion with slight upper bias
MTFS does not exhibit any clear pattern, and is indictative of a possible trading range. We will however watch Fib patterns developing upward or downward depending on pivots. The late recovery on friday is not affecting the Swing indicator yet, so we would favour a target down (132.20 then possibly lower). This will take a few days to materialise anyway.

Daily: trading range but...
beware of a volatility slowdown as a breakout can happen either way in the coming days. The bias is still down so one should favour a new test of recent lows.
MTFS is not helping at the moment, nor Entropy which is remarkably weak. Significance level is low, so one may have to pay more attention the 30 and 60 mins charts to get a better perception of market dynamics.

Weekly: bottom?
Again, despite the MTFS white line hooking up slightly, and Entropy appearing to have found a bottom, both show a relatively bearish background picture. So we may have a bit of a reprieve, but the negative tone is certainly still there, at least until the pattern is complete (line crossover and/or green line in oversold territory). This could help the formation of a a cup&handle or W pattern... or go lower although still unlikely at this stage.