Wednesday, June 11, 2008

Market Snapshot for SPY - Jun 11th 2008

cf. ER2 post below for guidance.

Market Snapshot for NDX - Jun 11th 2008

cf. ER2 post below for guidance.

Market Outlook ER2 (RUT) for Jun 11th '08

Dominant TF: all 3
Swings: DN-DN-UP
Market Direction(daily): up, congestion at first
Position (60mins): short
Options (RUT):
Short Jun790 Calls, Long Jun800 Calls OR
Short Jun830 Calls, Long Jun840 Calls for those who opted for safety

Sudden mood change on June 6th, but those who followed recommendations to switch to shorter time frames just went with the flow.

60mins: retracement slowing down
ER2 is now in a mild correction mode. Fib levels give a possible support around current lows, but ER2 could well drift lower to ~728 (stall level in shorter time frames) or right down to 719 strong support level.
A soft landing is the favoured scenario, but we'll remain cautious as we're in a high volatility environment right now.

Daily: up trend being challenged
We first notice a very alarming candle formation which often leads to a sizeable retracement. A target around 720 (also visible on the 60mins chart) is certainly in the cards. MTFS is not indicative of a fall, but of a congestion with a lower bias, so we believe at this point in time that the coming support level will hold.

on EURUSD, we have a support level just below yesterday's lows and a possible target at 1.5381. A bounce to 1.550 is possible.

Weekly: up recovery is still valid for the time being
We now have a better idea of where the long awaited resistance level actually is. We shall probably see the expected consolidation developing over the next few weeks but while we keep a close eye on a possible pivot level and new fib formation, we still only anticipate a congestion to minor retracement for the time being.