Thursday, March 13, 2008

Market Snapshot for SPY - Mar 13th 2008

cf. RUT post below

Market Snapshot for NDX - Mar 13th 2008

cf RUT post below

Market Outlook RUT for Mar 13th '08

Dominant TF: weekly chart. 60mins dropping
Swings: UP-DN-DN
Cycles: possible upturn, but caution is to be exercised
Market Direction: same trading range
Position (60mins): wouldn't go short.
Options: March iron condor to close with a profit. April in place:
Short Apr760 Calls, Long Apr770 Calls,
Long Apr570 Puts, Short Apr580 Puts

Support was found as mentioned on last post. I even hinted it may be a good time to exit short. Now what next? Not much probably... In French, we say "une hirondelle ne fait pas la printemps" i.e. seeing the first swallow doesn't quite mean that winter is over.

NB: to add to this period of high volatility, we also have triple witching coming. The end of the week could be stormy...

60mins: a secound round on 656?
RUT could well test the support level again, but the good thing is it will almost certainly hold. RUT however needs more energy to go higher, so there is a need for new buyers to come to the party now. MTFS is only expressing normal profit taking but Entropy is holding for the time being. In other words, we could have a down day, but no panic this time.

Daily: nice bounce on range lows, but no real recovery right now.
Yet, there is still no sign of a recovery. We indeed need a clearer MTFS pattern. We'll also watch for a possible Entropy bottom in the next few days (EntBin = -4).

Weekly: nothing new, i.e. congestion to down
We're now back to the previous lows, i.e. a level we had clearly anticipated. It is Fibonacci PR1 which may act as a support level here confirming the 60mins MM level. MTFS still looks bearish here, but as mentioned over and over on this blog, the negative pressure can also dissipate through the passage of time.
Here again, we have NO sign of recovery, but the conditions could emerge if 656 holds. We just have to be patient.