Wednesday, June 04, 2008

Market Snapshot for ER2 - Jun 4th 2008

cf. NDX post below for guidance

Market Snapshot for SPY - Jun 4th 2008

cf. NDX post below for guidance

Market Outlook NDX for Jun 4th '08

Dominant TF: 60mins (and lower TFs!)
Swings: DN-DN-UP (from UP-UP-UP)
Position (60mins): short to flat (profit taking)
Market Direction (Daily): congestion - trading range

Readers will notice i gave the right direction and support level on SPY yesterday. On EURUSD, shorter time frames are recommended and are very easy to read.

About NDX, i warned of a stall situation 3 days ago. I admittedly didn't venture into a specific scenario, which proved to be a little erratic yet tradable on a 30mins TF.
A lower time frame is again recommended for directional traders.

60mins: lower bias
MTFS is now turning into a down drifting situation. It seems the 2000 level while being a pivot has lost some of its significance and we may now see a trading range. NDX may develop a Fib pattern, however easier to read on a 30mins chart. To mitigate that scenario however, we will notice that Entropy is relatively weak, indicating possible congestion or a slow down drift.

Daily: congestion
No change from last NDX post: NDX is in a congestion phase with a remaining slight upward bias. We will also be cautious about this indecision by checking the channel lows.

Weekly: Congestion at key level, upper bias remaining.
No major change at this level:
The Fib/MM levels have been slowing down the seemingly irresistible ascension back to former highs. MTFS is still somewhat bullish and Entropy has not peaked yet. NDX may eventually keep hovering around the 2000 / 2010 level for a while, but until MTFS and Entropy actually confirm the slowdown, we will assume a "cautious" positive bias going forward.
Again, i wish to emphacise this is a key level as Fib patterns can develop both ways here, even if a downturn definitely looks unlikely.
Pivot number 5 (2050) could indeed turn into a full downward Fib pattern (target 1700), or could still be erased to take NDX back to last year's highs (>2200). Again the cautiously bullish scenario is still favoured for now and confirmation should come within weeks. Since this is not the dominant time frames, clues will certainly arise from lower time frame indicators.