Market Outlook NDX for Jan 9th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles (DomTF): have been turned off as too unreliable in this market
Market Direction (Daily): drifting down
Position (60mins):
Short: nothing wrong with taking profits, but maybe more to come
Flat: be patient
Long: you must be mad!

NDX is now looking for support.

60mins: possible congestion or slower price erosion.
As mentioned yesterday, support held for a while, then bears decided to have a go at it again.
Pattern-wise, MTFS needs better foundation to find support (crossover with a decent gradient in oversold territory), but Entropy is calming down a bit. MM support level is 1875, and we have a Fib pattern on the daily chart (equally significant at 0.88)

Daily: down looking for support.
Same as yesterday: MTFS is driven by its lines gradient right now. Amazingly, MTFS line levels are not quite indicative of a market fall just yet even if it is becoming a little alarming for some.
Again, the overall MTFS pattern is definitily not a conventional one (or close to a 'failed recovery' pattern), so we'll probably stay in a broader trading range until lines finally converge in oversold territory.
Volatility has however already pushed levels pretty wide apart so the next

support level may well be 1886 (Fib target) or around 1875 (MM support level on 60mins chart). MM Stall level is 1904.

Weekly: Channel broke out... what next???
It seems the bull run is now over so we may need to enter a correction mode (check FIb + MM levels)
We should however only note the clear down bias for now, and focus on shorter time frames. Please also note that Swing is still hesitant at this level and could therefore turn up again. In other words, correction mode is not bear mode just yet at this time frame.

Market Outlook RUT for Jan 8th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles: possible upturn, but very low significance level...
Market Direction: down, but possible support level at 719
Position (60mins):
Short: some may want to hang on, but nothing wrong with taking profits.
Flat: it would be cautious to stay a little longer on the sideline
Long: are we looking at the same chart !!!?!?

Note: this chart reads like SPY

60mins: congestion or down drift
The MTFS crossover does not indicate any recovery potential, and while Entropy seems to have bottomed it remains very low. EntBin is quite low at -4 though, but it has been low for a few days. In such situation a congestion at this low level is possible, but this support level is not very strong, so RUT could drift more altough there is no clear Fib level to aim to. The next strong MM support level is 688, which surprisingly is lower than on the daily chart.

Daily: down but 719 may hold for now.
The down drift may continue until lines eventually bounce in oversold territory. The previous recovery pattern (started end Nov) failed, so we have to wait for the next one... or adjust to a new bear trend.
For the time being, Entropy indicates little energy either way, so RUT may stay congested (with a lower bias) for a while.

Weekly: lower bias
MTFS is not looking too good, while its significance level is picking up. A support must be found soon otherwise RUT will definitely turn to correction mode down to 680.

Market Outlook SPY for Jan 8th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles: indicates a possible upturn but totally unreliable significance level
Market Direction: probably lower still
Position:
Short: nothing wrong taking profit around coming support level
Flat: be patient
Long: you must be mad

60mins: likely congestion or down drift.
The MTFS crossover came too early to indicate a recovery and Entropy hasn't bottomed yet, so we may have a congestion at best, otherwise SPY could well also drift to the stall level around 139, just above the strong support level at 137.50.
NB: EntBin is very low at -4 (Min is -5) though so a bottom may occur soon.

Daily: congestion to down
Similar to yesterday:
Like with NDX, we are surprisingly not in a very bearish environment just yet. SPY could drift further (137.75?) or just remain congested at this low level for a while (~140.60).

Weekly: congestion to down
Again, this time frame has difficulty adapting to the current market moves at the moment.
We would like to see Entropy stabilising for a possible recovery. We have to watch current levels or possibly 137.75 for a stronger support level now.

Market Outlook NDX for Jan 8th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles (DomTF): possible upturn but unreliable significance level
Market Direction (Daily): drifting down
Position (60mins):
Short: nothing wrong with taking profits, but maybe more to come
Flat: be patient
Long: you must be mad!

NDX could pause at this level, or even hold the position until negative pressure is exhausted. We are however more likely to see NDX coming down still. The market is not the easiest to read on account of various expectations on forthcoming rate cuts.

60mins: possible congestion or slower price erosion.
As mentioned yesterday, NDX found support on 1938 and even picked up a bit on the last hour of trading to close at stall level above 1950. NDX may hold at this level but this is unlikely to last long.
We know that such MTFS line crossover pattern is not conducive to recovery and Entropy has not bottomwed yet.

Daily: drifting down looking for support.
MTFS is driven by its lines gradient right now. Amazingly, MTFS line levels are not indicative of a market fall (Entropy either actually), so the 1938 support level may hold.
The overall MFS pattern is not a conventional one (or close to a 'failed recovery' pattern), so we'll probably stay in a broader trading range until lines finally converge in oversold territory.
Volatility has however already pushed levels pretty wide apart so the next support level may well be below 1900 at around 1875.

Weekly: Check channel's lower boundary
We should only note the clear down bias for now, and focus on shorter time frames. Please also note that Swing is still hesitant at this level and could therefore turn up again.

Market Outlook RUT for Jan 7th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles: possible upturn, but fairly low significance level...
Market Direction: down, but possible support level at 719
Position (60mins):
Short: some may want to hang on, but nothing wrong with taking profits.
Flat: it would be cautious to stay a little longer on the sideline
Long: are we looking at the same chart !!!?!?

60mins: the fall may at last find some support
734 did not hold in such a bearish environment. Next support level is 719, almost hit Friday afternoon. The MTFS white line is stabilising indicating the fall may be soon over, but the other lines still look quite bearish. 719 looks like it could hold though.

Daily: down but 719 may hold.
MTFS lines have a negative gradient that is too steep for RUT to recover right now. The pattern we saw since lines crossed over has failed and now needs a new start. Entropy is low, so the 719 level could hold but one should remain cautious as it also go lower.
Upturn in current cycle is unlikely right now (significance level way too low).

Weekly: lower bias
MTFS is not looking too good, while its significance level is picking up. A support must be found soon otherwise RUT will definitely turn to correction mode down to 680.

Market Outlook SPY for Jan 7th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles: possible upturn but unreliable significance level
Market Direction: probably lower lower still
Position:
Short: nothing wrong taking profit around coming support level
Flat: be patient
Long: you must be mad

We admittedly did not fully anticipate the market to fall so quickly. We thought the 143.75 level would be at least somewhat defended.

60mins: down still
The pattern is not quite complete yet, although the MTFS white line may imply some cooling down. The sentiment is still quite negative though.

Daily: congestion to down
I warned to be careful about the triangle breakout... could not be more right, could i ...? Surprisingly, MTFS and Entropy are not overly bearish yet, so we can see it either as room to fall further (137.75?) or maybe a sign it will be soon over (140.6?).

Weekly: congestion to down
Quite a volatile environment... This time frame has difficulty adapting to the current market moves at the moment.
We would like to see Entropy stabilising for a possible recovery. We have to watch current levels or possibly 137.75 for support now.

Market Outlook NDX for Jan 7th '08

Dominant TF: 60mins & also Daily
Swings: DN-DN-DN (from DN-DN-DN)
Cycles (DomTF): possible upturn but unreliable significance level
Market Direction (Daily): down
Position (60mins):
Short: hang on
Flat: be patient
Long: you must be mad!

We certainly saw it coming, but still got surprised by the strength of the sell-off, which accelerated after 2000 gave up to sellers.

60mins: down
NDX could pause a bit after this bloodshed as the MTFS white line crossed over, but the fall is not over yet. MTFS and Entropy still look bearish and the next support strong support level is 1938. (Look also at stall level just above 1950).

Daily: down but support is possibly not too far now.
The 60mins chart took over, and we did not quite expect 2000 to break so quickly. Being on the selling side, such surprise had no impact though.
Significance level is suprisingly still high, and despite the fact MTFS is not showing any classical pattern (after the 'failed recovery pattern' mentioned in December), its lines are only showing a down gradient in median territory, and Entropy itself is not the most bearish.
We also notice that the Swing indicator has some difficulty with fitting with the current volatility.
One cannot discard continuation of the sell-off on this breakout, but indicators are not pointing towards that scenario yet.

Weekly: Check channel's lower boundary
I had warned about the channel boundary. Prices may find a support level around Fib PR1 at 1938 which constitutes a strong MM level on the 60 mins chart.

Market Outlook RUT for Jan 4th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from UP-DN-DN)
Cycles: opposite directions and low significance level...
Market Direction: down
Position (60mins):
Short: some may want to hang on, but nothing wrong with taking profits.
Flat: it would be cautious to stay a little longer on the sideline
Long: are we looking at the same chart !!!?!?

60mins: lower, but possible congestion
750 broke late in the day, so check now for support around 734 (MM + recent lows). MTFS is still bearish, but is now close to oversold level.

Daily: same volatile environment.
MTFS now points lower yet since lines crossed end November RUT has followed a 'wavy' move upward, and could eventually bounce again within the same difficult, volatile environment. A bottom must be found first (734?).

Weekly: lower bias
Not looking good, but MTFS green line is holding fairly high so one can anticipate 750 to hold for now.

Market Outlook SPY for Jan 4th '08

Dominant TF: 60mins & Daily
Swings: DN-DN-DN (from UP-DN-DN)
Cycles: possible upturn but very low significance level
Market Direction: probably lower lower still
Position:
Short: nothing wrong taking profit around lower 144s
Flat: be patient
Long: very risky

60mins: congestion to possibly lower
As mentioned yesterday, we have early signs of a bottom, but despite the recovery late in the day, it is way too early to go long at this time frame (nothing wrong with a few swing trades at lower time frames though).

Daily: down bias
MTFS is fairly undetermined (with a slight lower bias though). One should be careful is 143.75 is broken. One can notice a triangle pattern.

Weekly: own
Despite the low significance level, one must be careful as we have another triangle pattern (lower highs - higher lows) with a possible breakout coming either way.

Market Outlook NDX for Jan 4th '08

Dominant TF: 60mins & also Daily
Swings: DN-DN-DN (from UP-DN-UP)
Cycles (DomTF): possible upturn - low significance level
Market Direction (Daily): same trading range [2000 - 2125], erosion to 2000 is quite possible
Position (60mins):
Short: hang on
Flat: be patient
Long: consider changing job

We anticipated a slowdown on the way down, yet 2040 is not a major support level, and all 3 Swings are down...

60mins: congestion to lower bias
NDX is still looking for a lower support. Swing went momentarily up yesterday indicating the pause we saw. Indicators are still too bearish to envisage an upturn right now. Despite a recovery late in the day, price erosion may continue to 2032 (next levels down are about 16 points apart).

Daily: same trading range - looking for lower support around 2000
No clear directional pattern despite good significance level.
Non-directional traders can take advantage of this market configuration (lower bias, and support likely to hold at this stage).

Weekly: Caution: Check channel's lower boundary
Significance level is too low to pay attention to MTFS, and to this time frame in general. Yet, one shall keep an eye on the channel lower boundary currently around 2030. Breaking 2000 could mean a much lower support level.

Market Outlook NDX for Jan 3rd '08

Dominant TF: 60mins & also Daily
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning down - low to average significance level
Market Direction: same trading range [2000 - 2125], erosion to 2000 is quite possible
Position:
Short: hang on
Flat: be patient
Long: go get a tissue

Happy New Year to all!!
I'm sure you haven't missed my snapshots over the festive season, as the market was quite easy to read. We have seen mostly red bars on the dominant 60mins time frame, until NDX reached Fib PR1. Now what's next? We have closed 2007 on a soft landing on a predictable level. Price erosion is still there and we may have no serious support before 2016, or maybe even 2000.

60mins: lower bias
NDX is looking for a lower support. The Swing is momentarily up, which could indicate a pause or a slower fall, but MTFS is still quite bearish.
Look for support on 2016 (stall level) or even 2000.

Daily: same trading range since November - looking for support around 2000
No clear directional pattern despite good significance level.
Non-directional traders can take advantage of this market configuration (lower bias, and support likely to hold at this stage).

Weekly: Check channel's lower boundary
Significance level is too low to pay attention to MTFS, and to this time frame in general. Yet, one shall keep an eye on the channel lower boundary currently around 2030.

Market Outlook RUT for Jan 3rd '08

Dominant TF: 60mins & Daily
Swings: UP-DN-DN (from DN-DN-DN)
Cycles: possible yet still unconvincing upturn
Market Direction: probably lower at first - 750 is key level
Position: bears may want to look at an exit point

If not currently in the market, it would be cautious to stay a little longer on the sideline.

(sorry again for delayed posting...)

60mins: lower, but possible congestion
Definite lower bias, but 750 is a strong level which be fought.
Caution must be exercised with this late up swing, even if this is a very early indicator.

Daily: same volatile environment.
MTFS now points lower yet since lines crossed end November RUT has followed a 'wavy' move upward, and could bounce this time again, within the same difficult, volatile environment.

Weekly: lower bias
Not looking good, but MTFS green line is holding fairly high so one can anticipate 750 to hold for now.