Market Outlook RUT for Dec 13th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-UP-DN (from UP-UP-DN)
Market Direction: possible congestion and higher volatility ahead.

Read previous general comments on SPY and NDX.
Patterns are different, but dynamics are correlated.

60 mins: Support level may have to be found lower
The 765 support level seems to hold, but MTS definitely has a lower bias, so it may be tested again. Entropy is quite low and could well bottom out once support is confirmed.

daily: congestion to moderately up in a high volatility environment.
MTFS and Entropy are weakening a bit, so we may have some congestion ahead. Again, the MTFS recovery pattern we've seen is certainly not our favourite, so we need a stronger base to go higher.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias. A weekly up bar, and if not blue, at least yellow, would confirm a safe return to the trading range.

Market Outlook SPY for Dec 13th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-UP (from DN-UP-UP)
Market Direction: No change in overall direction just yet, but lower bias in the short term

Similar comments as NDX.

60mins: Support must first be found (~147?)
Like the day before, and despite the recovery late in the day a support must be clearly found first.
MTFS lines confirm some moderate bearish outlook, but this may change upon even a mild recovery after support is confirmed.
Significance level is dropping fast indicating one should follow short time frames for entries and exits, and look for direction or absence thereof on this daily chart.

Daily: up technically but congestion to mild retracement at first.
MTFS white line is showing signs of weakness and Entropy is very high (Bin=5) and close to peaking.
We're therefore probably ahead of a congestion period.

Weekly: Congestion to moderate upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 13th '07

Dominant TF: 60mins (and lower)
Swings: DN-UP-UP (from DN-DN-UP)
Market Direction:
Congestion with a lower bias at first.
Has support been found (2062?) ??

Again, this is a perfect environment for intraday traders, All lower time frames have a significance level higher than these ones.

60mins: high volatility - support may be found lower.
Yesterday's commentary was again quite valid.
Now it isn't clear whether support has been clearly found yet. Bars are red, lows are lower... MTFS and Entropy also point down: the bounce we had may have been short-lived at least for now.
MTFS does not look very bearish either so we may have a lower support around 2062, and then more congestion...

Daily: congestion to mildly up
MTFS and Entropy suggest a slowdown, and indeed a stronger bounce on 2062 may be needed to go higher.
One has to be careful though. It would be good to see a Up day, and at least a yellow bar to make sure NDX does not congest a little lower.

Weekly: congested to moderately up
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Market Outlook NDX for Dec 12th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from UP-UP-UP)
Market Direction: Support must be found (2062?) - no change in overall direction just yet.

Yesterday's warning was certainly warranted, and the drop after the Fed announcement was quite interesting to follow on a 5 minutes chart. At this point in time, it pays off to go lower in time frames (all have a significance level higher than these ones)

60mins: high volatility - good possibility of a bounce once support is found.
After indeed hitting a high at 2147, NDX took a bit of a knock to close around Fib PR2 (61.8%). Should this level now break, since there is still some negative sentiment, NDX could well go lower to the 2062 pivot level.
MTFS is again not showing a clear pattern, which may indicate continuation of a congestion in a high volatility environment.

Daily: Up
Despite yesterday's drop, the pattern remains unchanged, and the bar even remained blue. We may have a second down day, but surprisingly one cannot say there is a retracement coming.
One should obviously be cautious, but not bearish quite yet.

Weekly: congested to moderately up
Significance level is low, but NDX is still in its channel, Swing is UP and the weekly bar is not red.

Market Outlook RUT for Dec 12th '07

Dominant TF: Daily, 60mins
Swings: DN-UP-DN (from UP-UP-DN)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.


60 mins: RUT should stabilise on support level
RUT first hit its Fib target but then ended the day much lower on a strong intraday support level (765.63). Since there is still some negative energy to dissipate, it may go lower or at the very least remain in a congested trading range. Should the current level break (which is not visible right now) the next support level would be 750.
MTFS is not very bearish right now, but definitely indicates a lower bias.

daily: up & bumpy
We've now got the little bit of volatility we've expecting for a few days. The overall up pattern remains unchanged in the short term.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. Current congestion still hides a down bias. A weekly up bar, and if not blue, at least yellow, would confirm a safe return to the trading range.

Market Outlook SPY for Dec 12th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-UP (from UP-UP-UP)
Market Direction: No change in overall direction.

Similar comments as NDX.
Short term intraday traders must have smiled ear to ear

60mins: Support must first be found (~147)
Reaction to the Fed announcement was stronger than expected, and support may now be found on recent lows around 147. MTFS lines have crossed and look bearish in the short term, but one should wait for the pattern to form over the next few bars (maybe up to a day).

Daily: up technically but a support must be confirmed.
Yesterday's comment was quite valid. Now, MTFS and Entropy have little changed after yesterday's down day so one should expect support to be found and SPY to bounce up again.
A word of caution though: SPY about hit its Fib target before the fall, so last pattern can be seen as completed and a new down leg could start. Secondly, we may have congestion around pivot level for a while, so even if we have a bounce soon, behaviour on 150 will have to be watched carefully.
I also wish to remind a comment made over a week ago. Such MTFS crossover was not indicative of a stable recovery pattern, and we did not 'get' our retracement to confirm a return to the up trend.

Weekly: Congestion to upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook RUT for Dec 11th '07

Dominant TF: Daily, 60mins
Swings: UP-UP-DN (from UP-UP-UP)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.
One shall note that Swing on weekly chart has turned down again. This may mean like for SPY that RUT is sitting on a key level.

60 mins: congestion
We have a little bit of energy left to eventually bring RUT a little higher, but MTFS certainly looks congested. Targets are just around the corner anyway: 795 Fib target + 797 MM level.

daily: up & bumpy
Virtually no change since yesterday:
We have seen the recovery pattern actually materialising after RUT tested 750 again to bounce quickly to current levels. Again this type of recovery is seldom stable, and it would be surprising to see it going higher without some retracement, so there could be more volatility ahead.
A pivot no4 now appears, so let's see how RUT behaves on 795.

weekly: Directionless for the time being
Same situation: range [750-875]
Swing turned back down indicating RUT is not out of the woods just yet. RUT is certainly on a key level but the blue bar is reassuring, so a weekly up bar would confirm a safe return to the trading range.

Market Outlook SPY for Dec 11th '07

Dominant TF: Daily
Swing: UP-UP-UP (from UP-UP-DN)
Cycle: Daily 128: Avg
Market Direction: Upper bias but possible congestion

Similar comments as NDX.
Swing turned up on weekly chart indicating this could be a key level.

60mins: Congestion to slight upper bias.
Virtually no change:
Significance level is coming down, ahead of MTFS pattern completion. We would prefer a crossover in overbought territory, but looking at current line gradients, that may just not happen. Entropy is still positive so MTFS can still crawl slightly upward in the short term. Testing 150 for support would be a good sign for bulls. A significant retracement is unlikely at this point in time (i.e. currently in price dynamics).

Daily: technically up, but behaviour on 151 must be still watched very carefully.
We unfortunately have little more to say today:
SPY now hit PR2 (61.8% Fib retracement) and hovered there. MTFS is however bullish now so SPY could well reach next Fib target (just above 153).
We must however as always remain very cautious. Continuation of congestion or even a retracement are quite possible in the short term.

Weekly: Upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 11th '07

Dominant TF: 60mins (and lower)
Swings: UP-UP-UP (from UP-UP-UP)
Market Direction: Moderately up but watch 2140 level

Market not expected to move much ahead of Fed announcement and forthcoming triple witching day. Dominant time frame is around 15 to 30mins, so users of the technique will better appreciate current dynamics.

60mins: congestion to upper bias
MTFS is not showing a clear pattern yet, and we can only hope lines will join soon. In the meantime, one can only anticipate the continuation of the current congestion with an upper bias.

Daily: Up, but first fib target has been hit on 2140
MTFS and Entropy point towards going higher to 2185 and 2250 but a resistance has been hit at 2140. We could therefore see a little bit more congestion ahead, but certainly no retracement in sight just yet. Should congestion linger on, we'll have to watch Entropy potentially peaking though (LEntBin=4) over the next few days. In other words, behaviour on 2140 will determine forthcoming direction.

Weekly: up...
NDX is half-way in its channel again, and the bar has not turned blue. Significance level has fallen to 44% which is understandable as current moves are way too fast for this time frame.
One shall note that around 2125 the swing indicator oscillates between UP and DN.

Market Outlook RUT for Dec 10th '07

Dominant TF: Daily, 60mins
Swings: UP-UP-UP (from UP-UP-DN)
Market Direction: Upper bias, but volatility ahead.

Read previous general comments on SPY and NDX. Patterns are different, but dynamics are correlated.

60 mins: congestion
Friday ended up as congested after boucing again on 781. We however have little energy to bring RUT much higher in the short term. Having said that, we should keep in mind a possible (longer term) Fib target of 795 now (with MM level at 797) that the 781 support seems confirmed.

daily: up & bumpy
We have seen the recovery pattern actually materialising after RUT tested 750 again to bounce quickly to current levels. Again this type of recovery is seldom stable, and it would be surprising to see it going higher without some retracement, so there could be more volatility ahead.

weekly: Directionless
Same situation: range [750-875]
Swing turned up but it is far too early and the angle is too steep to consider this up swing stable.
RUT is not out of the woods just yet.

Market Outlook SPY for Dec 10th '07

Dominant TF: 60 mins and Daily
Swing: UP-UP-DN
Cycle: Daily 128: Avg
Market Direction: Upper bias but possible congestion

Similar comment as NDX.
SPY surprisingly passed the 150 level late in the day to almost hit PR2 (151.06).

60mins: Congestion to slight upper bias.
Significance level coming down a bit, ahead of MTFS pattern completion. We would prefer a crossover in overbought territory, but looking at current line gradients, that may just not happen. Entropy is still positive so MTFS can still crawl slightly upward in the short term (even some congestion above 150 could be good enough).
A retracement is unlikely.

Daily: technically up, but behaviour on 151 must be watched very carefully.
We unfortunately have little more to say today:
SPY now hit PR2 (61.8% Fib retracement) and hovered there. MTFS is however bullish now and current resistance level should technically be broken. We must however as always remain very cautious. Continuation of congestion or even a retracement are quite possible in the short term.

Weekly: Upper bias
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
For the time being, higher highs and higher lows are bullish signs, with due caution that moves in the last 6 months have been way too fast for this time frame.

Market Outlook NDX for Dec 10th '07

Dominant TF: 60mins (and lower)
Swings: UP-UP-UP (from UP-UP-DN)
Market Direction: Moderately up - behaviour on 2125 is key

We've had some congestion as expected (MM + Fib + undecisive MTFS).

60mins: congestion, but behaviour on key resistance level may cause some congestion.
MTFS is again not showing a clear pattern, and we can only hope lines will join soon. In the meantime, one can only anticipate the continuation of the current congestion with an upper bias. Entropy is holding quite well, so a retracement is unlikely.
Current level is a mix of Fib and MM levels. Possible longer term target remains [2185-2190].

Daily: Up, but reversal around 2125 remains possible while unlikely.
We have the same scenario going on with a bit of a slowdown on the way to 2185 and 2250. There could be a little bit more congestion ahead, but no retracement in sight just yet. We'll have to watch Entropy potentially peaking though (LEntBin=4) over the next few days.

Weekly: up...
NDX is half-way in its channel again. We don't have a blue bar yet though. Significance level has fallen to 44% which is understandable as current moves are way too fast for this time frame.
One shall note that the swing indicator oscillates between UP and DN at current levels.