Market Outlook SPY for Dec 18th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-DN-DN (from DN-DN-UP)
Cycles: up - good fit but low significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Fairly good quality cycles on daily chart pointup upward in the short to medium term.

60mins: down
Like for NDX, the acceleration down came a little bit as a surprise. The lower part of the trading range (147) was broken to reach the next level down. Now, while there could be a pause, SPY seems to point towards 143.75. MTFS and Entropy indeed do not indicate a bottom just yet.

Daily: congestion is likely, but wait for support to be confirmed.
After 146.8 was broken, SPY surprisingly accelerated to the next support level which is also a stronger Fib level. While a strong rebound looks unlikely, congestion is now quite possible with MTFS lines hovering median territory.
MTFS and Entropy gradients indicate some weakness, but no reason to panic just yet.

Weekly: Congestion & Volatility
MTFS is unreadable because of the low significance level, hence one should not pay too much attention to the lines down gradients.
Note that Swing has turned down again.

Market Outlook NDX for Dec 18th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low to avg significance level
Market Direction:
lower until next support

60mins: 2000 is now in sight.
As I thought, the down move accelerated (cf Entropy) during the course of the day, which is a good sign as it is always best having a support level hit with some energy to generate some reaction.
MTFS and Entropy are not indicating a bottom just yet. However, stall level is about here at 2016, and the strong support level at 2000 is in sight now. There seems to be still too much energy to stop the fall on 2016, even if a pause should at least be marked at that level first.

Daily: lower til support is found (2000)
I admittedly missed this volatility spike, and thought support levels on the way down would hold at least for a while. It is not uncommon to see MM levels acting as attractors, particularly after a slowdown period.
However, MTFS lines while turning down do not indicate a significant move, so a strong support level like 2000 should hold. We shall obviously remain cautious.

Weekly: Check channel boundary
While significance level is low, this mostly affects MTFS. We can still notice that NDX is touching the lower part of its channel, and the weekly bar is red. Caution should be exercised at these levels.

Market Outlook RUT for Dec 17th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-DN-DN (from DN-UP-DN)
Cycles: up - good fit
Market Direction: congestion with a lower bias

Like for NDX and SPY, it is likely that the next support level (750) will be key to forthcoming direction.

60 mins: Support level may have to be found lower
MTFS points lower and Entropy is stable, indicating continuation of price erosion. One should obviously pay attention at RUT's behaviour on 750, but like for other symbols, we're not in a situtation of a potential stronger rebound. RUT could therefore remain congested in the low 750s, or even try and test previous lows around 740.

daily: congestion.
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. IT is likely that these [740-750] levels will be be fought, and who knows whether bears or bulls will win. At the moment, only the cycle indicator points up, and we know it is not always a reliable predictor.

weekly: Directionless with a lower bias 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.
The weekly bar surprisingly did not end up turning red. Again behaviour on 750 will be key.

Market Outlook SPY for Dec 17th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-DN-UP (from DN-UP-UP)
Cycles: up - good fit
Market Direction: No change in overall direction just yet, but a support must be found soon

Fairly good quality cycles on daily chart pointup upward in the short to medium term.

60mins: Lower bias, check behaviour on 147.
SPY started the day directionless but the 147 level acted as an attractor. There isn't much negative energy so no reason to believe it will go much lower at this point in time.
The trading range should remain in the lower part of [147-150].

Daily: slightly up after support is found shortly.
MTFS white line is showing signs of weakness and Entropy has now peaked. We have to watch for Fib support levels (146.8, then possible 145.3). SPY could well stay congested within a [147-153] trading range.

Weekly: Congestion & Volatility
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 17th '07

Dominant TF: 60mins (and lower)
Swings: DN-DN-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low significance level
Market Direction:
Congestion with a lower bias at first.
Will support be found on 2062 ??

60mins: congestion to lower bias.
Like for RUT and SPY, NDX will have to test the next 2062 support level (Fib + MM) but should there some acceleration on the down side, NDX being generally quite volatile, a support around 2050 is also possible.
For the time being, one should not try and read what is not in the prices yet, and congestion with continuation of this drifting situation is a more likely scenario.

Daily: moderately lower
MTFS and Entropy are slowing down further, so some NDX will continue drifting until the next support level. Note that there is no negative energy just yet, so this is not a reversal situation.

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

Jingle bells...

First, I wish you all the best for the festive season!

I am going to take it a little easier after triple witching day, and will only post one daily commentary on RUT and only if the market situation warrants it. Indeed, apart from some large funds and institutions doing some window dressing on year close, there is generally a slowdown so commentaries can be quite similar day after day.

In case a specific advice is however needed, please contact me by mail.

Market Outlook RUT for Dec 14th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-UP-DN (from DN-UP-DN)
Market Direction: congestion with a lower bias

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
RUT seems to have found support around the high 750s, which corresponds to a weak Fib level and a MM stall level (not quite justified). RUT could therefore drift lower to 750.
At the same time since MTFS is only moderately bearish, RUT may just remain congested in more or less the same trading range.

daily: congestion.
MTFS and Entropy are again weakening a bit, so we may have some congestion ahead. Again, the MTFS recovery pattern looks more and more like the 'failed recovery' pattern mentioned about a week ago. Support will be found around 757 (Fib) or right down to 750. Since there is no clear direction in the short term, one may take yesterday's low (759.20) as the stronger base we need to go higher.

weekly: Directionless with a lower bias 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 14th '07

Dominant TF: Daily and low intraday time frames
Swing: DN-UP-DN (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: Congestion within the same trading range.
We've had about the same situation with a recovery in the last couple of hours. 147 was not clearly hit though.
MTFS lines still have a slight bearish outlook, but it seems like SPY could be directionless.
The trading range should remain [147-150].

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 within a [147-153] trading range..

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 14th '07

Dominant TF: 60mins (and lower)
Swings: DN-UP-UP (from DN-UP-UP)
Cycles: long cycle pointing down - low significance level
Market Direction:
Congestion with a lower bias at first.
Has support been found (2062?) ??

Again, and sorry to repeat myself: this is a perfect environment for intraday traders. All lower time frames have a significance level higher than these ones. In addition, the environment is about the same as the day before.

60mins: congestion to lower bias.
Yesterday's commentary was again quite valid.
A support may have been found, yet there is still a bit of negative bias in MTFS and Entropy. The half-way MM level which looks like a support level right now is the well known 'stall' level. The fall was however not quite fast enough to justify it, so it is likely that a stronger base will be found lower (2062?). The uncertainty comes more from this 'drift' situation showing a lack of internal dynamics.

Daily: congestion at first
MTFS and Entropy suggest a slowdown, so some congestion ahead is likely. A second red bar may suggest we need a stronger support level to go higher.

Weekly: congested to slightly 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 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.