cf. SPY post below for guidance.
NOTE: there will be no Market Snapshot tomorrow Friday 2nd
Thursday, May 01, 2008
Market Snapshot for NDX - May 1st 2008
cf. SPY post below for guidance.
NOTE: there will be no Market Snapshot tomorrow Friday 2nd
Market Outlook SPY for May 1st '08
Dominant TF: weekly and daily charts.
Swings: DN-UP-DN
Cycles: unreliable
Market Direction (daily): congestion to upper bias
Position (60mins): flat (too volatile at this time frame)
SPY reacted negatively to the Fed announcement, and this may trigger the profit taking we anticipated lately. We will also keep an eye on 1.5625 on EURUSD.
NOTE: there will be no Market Snapshot tomorrow Friday 2nd
60mins: directionless, erosion is likely
We have the most erratic MTFS behaviour, so we'll stay away from this time frame (sig. level is low anyway). It is likely that SPY will go lower and test 137.50 again.
Daily: congestion with upper bias
Last post was correct but it seems we are now closer to some profit taking. We shall notice the high EntBin (=4) and a peaking white line on MTFS. Since the other lines are about mid way and pointing up still, a retracement should be limited. We will therefore check the 137.50 levels as well as other possible Fib levels ans channel lows.
As said last time, the way to 150 should be a little bumpy...
Weekly: aiming higher but retracement is likely at first
No change from last post:
MTFS lines are certainly pointing higher but the pattern itself is not a recovery pattern. In most cases, this kind of pattern announces a retracement at some point. Now that the PR1 Fib level seems passed, this may happen on the 50% Fib level or higher, and looking at previous support levels, testing 137.50 could set a strong base going forward.
Wednesday, April 30, 2008
Market Outlook ER2 (RUT) for Apr 30th '08
Dominant TF: weekly chart, 60mins had to be retuned
Swings: DN-UP-UP (weekly swing hesitant)
Cycles: good fit but high noise level
Market Direction: upper bias
Position (60mins): undecisive.
Options (RUT):
Short May780 Calls, Long May790 Calls,
Long May550 Puts, Short May560 Puts
RUT (ER2) has tried to breakout on the up side as expected, but has shown little energy and is now trying to find some support to possibly go higher later on. A pause or retracement seems inevitable even if we cannot pinpoint the exact timing right now. Shorter time frames may help.
We will also follow EURUSD and QM closely. We spotted the breakout as it happened, and still believe 1.5625 to be a key level going forward.
60mins: will MM pivot level hold?
MTFS is not giving us a clear pattern, and Entropy is weak and relatively directionless. In absence of any significant economic news (GDP?), no major move to expect over the next few bars.
Daily: same upper bias, but a retracement will be necessary.
We are again at range highs, and while MTFS looks positive, the white line is close to overbought level with other lines lagging behind. If we add a high entropy level (EntBin = 4), a retracement should occur shortly. This means that we should not pass range highs in the short term.
Weekly: congestion
The worst certainly seems over, and the upper bias is still there, so ER2 is trying to pass Fib PR1 yet with some difficulty. To be on the safe side though, we will wait for the MTFS pattern to complete now (line crossover). Until then we have to consider the remaining downward pressure which will slowly dissipate.
ER2 can also possibly reach the very strong 750 resistance level before retracing/congesting but the most likely scenario for the time being is the same [690-730] trading range. Levels above 750 are quite unlikely in the next couple of months.
Tuesday, April 29, 2008
Market Outlook NDX for Apr 29th '08
Dominant TF: Daily.
Swings: DN-UP-DN
Market Direction (Daily): up overall, but volatile still.
Cycles: good fit, and long cycle peak detected
Position (60mins): flat
NDX is crawling up... aiming unconvincingly at 2000. A pause looks more and more likely.
60mins: overbought, trying to go higher
NDX has passed 1900 and is trying to go higher. MTFS is however overbought and if we look at a lower time frame (15mins has a higher significance level), we have a strong resistance in the higher 1930s. A retracement is possible in the short term (cycle peak).
Daily: wavy up...
No major change since last post: NDX is on its way to 2000. The MTFS pattern is now confirmed and should continue until lines meet again somewhere near overbought level. We however notice tht the white line is peaking and EntBin is very high, hence NDX could possibly take a pause in the short term. In the worst case, NDX would test channel lows or back to the 1875 pivot level.
Weekly: a pause on the way up is likely
Like on lower time frames, it is now visible that NDX is aiming at 2000 (MM + Fib). We can however notice that this could leave the bearish MTFS incomplete. While possible, this scenario remains unlikely and a consolidation seems necessary at some point. We'll therefore check for a Fib/MM level (1950?) for a retracement which will help complete the MTFS pattern.
As said earlier, the 2000 level will be key to market direction for the rest of the year.
(May call spreads above 2000 are quite safe)
Sunday, April 27, 2008
Market Outlook SPY for Apr 28th '08
Dominant TF: 60mins followed by the weekly chart.
Swings: UP-UP-UP
Cycles: not a good fit, but low frequency detected
Market Direction (daily): congestion to upper bias
Position (60mins): flat looking for long entry point
SPY bounced on resistance level (tested for support) to now reach range highs again, exactly as anticipated on last SPY post. What next now?
As a note, the last EURUSD post really came spot on as the breakout occurred that same day. We will keep an eye on it as EURUSD is back on the key level and could actually go lower, impacting all other markets starting with crude oil.
60mins: upper bias but hesitation at range highs
SPY is trying to go higher, only stopped by a 1st Fib target and range highs. MTFS looks overbought yet positive, but Entropy is lacking energy to breakout right now. Despite this hesitation, going higher remains the most likely scenario though.
Daily: congestion to upper bias
SPY is now back to year-to-date highs, but could well go higher. MTFS is pointing higher yet SPY could also first find support on MM pivot level (137.50). In such case SPY would aim at the 50% retracement level at 141.70. The MTFS pattern does not however indicate a straight path to 150 but the bias is UP overall.
Weekly: aiming higher
MTFS lines are certainly pointing higher but the pattern itself is not a recovery pattern. In most cases, this kind of pattern announces a retracement at some point. Now that the PR1 Fib level is passed, this may happen on the 50% Fib level or higher, and looking at previous support levels, testing 137.50 could set a strong base going forward.
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