Market update - Jun 2nd '09

ES and TF indeed broke out on the upside, ES reaching the top of the trading range in a quantum leap we've discussed before. TF understandably "heavier", went the same way, but was stopped on stall level.

A moderate retracement is possible at this level since 937 is a strong resistance level on both the 60mins and Daily charts. Markets are very bullish and overbought but a retracement from highs is likely to be limited and possibly test the low 920s (previous highs of the trading range which just broke out).

TF paused on stall level but shows little inclination to retrace still. Difficult to say whether it will attempt to reach 530 or gather forces on Fib PR1 just above 500, but there is probably enough momentum left in the market to aim a little higher.

( posted 7:30 AM UK )

Weekly Report on ES & TF - Jun 1st to 4th '09

Here is the month of June, a summer break in sight for those who can afford one, and maybe time to relax soon, to take a step back and look at these mad markets again... Does anyone know where markets will be Dec 31st ? No the slightest idea, i'm afraid.

Anyway, not there yet, so let's have a look at what's in store for this coming week:

ES is definitely trying to breakout on the up side, the 60mins chart is quite bullish with a target just above 930 then 937. Breaking the daily highs would certainly open the way to the almighty 1000. Again we have no such evidence on our charts, and while this may look like stubbornly contrarian, the chances of retracement are still substantial.

If we now take cues from TF, this 500 level is certainly crucial and could certainly give is the market direction at least for the next few weeks. It has been penetrated, but is still valid. We can't ignore ignore that we have a Fib target around 541 hence a strong breakout potential here too. The 60mins chart is here also very bullish, and we also have a lid just above 500 containing prices for the time being. ER and ES have now aligned on their respective resistance levels and could congest or breakout in concert.

The GM announcement today may have a bullet effect either way. If we stick with our "go with the flow" method, our scenario for the week will remain: congestion (daily) with a strong upside breakout potential (60mins).

( posted 8:15 AM UK )

Market update - May 29th '09

Would be a good time to go on a long weekend today, as there is very little to add about these markets.

One can just notice a narrowing of the range, indicating a possible breakout either way. The daily chart still points for a retracement as mentioned in previous reports.

Look for breakout immediate targets around 882 on the downside, 920 in the upside, still within our daily range, hence still in the same congestion. Ultimately, retracement is still our favourite scenario.

( posted 6:55 AM UK )

Market update - May 28th '09

ES finally decided to plunge on the 60mins chart, but nothing to be excited about at least until we've passed daily range lows (strong support in the 875 area).

We might indeed see some continuation of the current hesitation for a little longer. However the daily indicators start showing some exhaustion so we might see the support being tested soon enough. Note that we still have a lower targetin the high 820s.

Once again, TF follows a similar path. Range lows on support level around 468 must be broken before we can aim at the low to mid 440s, then around 300. We do not anticipate more than a moderate retracement for now.

( posted 7:45 AM UK )

Market update - May 27th '09

Sorry for yesterday... one of those days...

Anyway, was i right or wrong ? A bit of both. ES indeed hit lows as expected, but i did not pay enough attention to the bounce potential. ES even passed a significant 906 level and could therefore aim back at range higher in the low to mid 920s.

Having said that, this is only "noise" at daily level, and this trading range is kind of directionless, and could eventually break on the way down, as described in previous reports. Our outlook remains a target in the mid 820s upon breaking on the 866-875 level. On the upside, the target would obviously be the almighty 1000.

If we take cues from TF (aka ER), we'll have to check the 500 level carefully. It should hold and send prices down, but we'll remain carefully of a breakout nonetheless.

( posted late 7:40 AM UK )

Market update - May 26th '09

Just a quick note today. One should expect slow drifting to last week lows, or to major support as described in previous reports.

More details tomorrow.

( posted late 10 AM UK )

Weekly Report on ES & TF - May 25th to 29th '09

Last week, ES bounced on stall level to reach about Fib PR1. ES now shows little energy either way on the 60 mins chart, which is maybe understandable as markets are closed today on Memorial Day.

The longer term scenario remains unchanged with markets looking at taking profits down to the mid 820s yet not showing more than a marginal profit taking potential at the moment. This can be explained by a relatively strong support level in the 866-875 area.
One cannot exclude a less likely scenario of prices rising to sell more heavily on 906-908.

TF again follows about the same path with a possible landing on 468 on the 60mins chart. The daily chart gives us a lower target in the low 440s, but doesn't show any energy to take us there yet. Breaking 468 would certainly help but we'll assume a trading range for now.


( posted 7:10 AM UK)


NB: the market update will be posted late tomorrow.
Memorial Day today in the US.

Market update - May 22nd '09

Selling took prices almost to the 875 level to bounce late in the day. That level is definitely going to be a test for our target in the mid 820s.

We see ES having difficulties passing the 892/894 levels and some range bound trading is quite possible. Only if 875 is broken, will we then consider the retracement starting. In the meantime, it is recommended to rather stick to lower time frames.

Having said that, we cannot discard 892 (acting as a pivot) breaking to then see movements in the higher part of the price segment i.e. 892 to 906. For the time being, we favour the lower trading range i.e. below 892. Again, a lower time frame is required to pick up movement details.

Same for TF, except price segments are wider percentage-wise.
Check 485 to 489 for pivot.

( posted 7:15 AM UK )

Market update - May 21st '09

We've had TF showing clearer patterns for quite a while, with the almighty 500 level acting as a "strange attractor" and now triggering some selling. Our target on the 60mins chart is 480, but again, the selling pressure is quite limited on the daily chart so it is difficult to say whether we'll reach the low 440s Fib target there. A period of congestion is more likely.

Let's go back to flagship ES now.
It is started a pretty steady descent with an immediate target on 894 then 890 (tick charts). 892 is actually also a Fib target, so we have a few easy points to pocket there. However we have to realize that while we do have a Fib target nicely laid out for us in the mid 820s, we have no indication of substantial selling pressure to take us there yet.

( posted 7:15 AM UK )


Note: Next Tuesday's report (May 26th) will be posted late.

Market update - May 20th '09

ES stayed high yesterday and even spent most of the day a little higher than the 910 level i mentioned to only start drifting in the afternoon.

We should see a continuation of the current movement, probably to 900, then 895.5. Selling pressure is however limited. We have noticed that the 875 resistance level has turned to support level last week. It can technically be tested again opening the way for a more sizeable retracement to the 825 area, but it is only one possible scenario at the moment. Again, there is not enough selling pressure at the moment and buying could resume in the mid to high 890s levels.

Same situation on TF (ER).
Possible target in the low 480s, but selling pressure is simply not there right now. Who knows... It may just take a spark to get the market going though...

( posted 6:20 AM UK )

Market update - May 19th '09

Who's now surprised about volatility? The expected bounce on 875 started on 876.75 (certainly not an exact science and even less so on long time frames), to jump right up to the top of the price segment, almost exactly equal to Fib PR2.

Prices should stay in this high part of the range at least in the short term, but again, while we don't anticipate heavy selling, ES should stay in the same price range for now (i.e. below 910).
We may have some congestion or drifting, but it will take some time to reach the 1st Fib retracement target (866), to then possibly validate our scenario for a target in the high 820s. We'll update this scenario as the week goes along. Again, not much of a selling pressure on the daily chart.

TF again follows a very similar pattern and could lead ES on its profit taking path.

( posted 6:40 AM UK )

Weekly Report on ES & TF - May 18th to 22nd '09

ES is retracing in a pretty clean manner with an obvious target around 875. We've had a small bounce on 878 (1st Fib target) on the 60mins chart, but selling pressure is still there. In fact, support could be found a little lower (~867).

On the longer term (daily chart), it seems ES could shed another 50 points for a retracement target around 825. Having said that, we still have no indication of significant selling, and even less of a return to a bearish trend, so we'd better check behaviour on the [866-875] support area.

TF (e-mini Russell 2000) follows a similar path with an immediate target around 468, and seems a little more bearish (reversal indications were also clearer last week). It may reach 444 by the end of the week. Like ES, let's first see what happens on 468 before we confirm that (likely) scenario.

( posted 7:20 AM UK )