Market Outlook RUT for Dec 20th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: UP-DN-DN (from UP-DN-DN)
Cycles: up - good fit - average to good significance
Market Direction: congestion with a lower bias, but caution on this key 740 level

We can see opposing MTFS patterns with the same significance level, indicating likely congestion

60 mins: up to Fib PR1, but then what...?
Some lethargic revovery which should crawl to Fib PR1 (almost hit it late in the day), but as we have seen recently, the MTFS crossover is indicative of a 'failing recovery' pattern. RUT should therefore not go much higher.
750 has been tested during the course of the day, and could tested again.

daily: trading range is likely, but support must be confirmed.
Again, no change from yesterday:
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. There are no signs of a recovery (except for the cycle indicator) so RUT should fluctuate within the lower part of the [750-780] trading range. Should volatility increase, the range can be [740-790] .
NB: Cycles are the least reliable indicators in our toolset, and can only help determining turning points when all indicators point in the same direction, which is not the case at the moment.

weekly: Same trading range [750-875] with lower bias. Caution must be exercised on key level.
Swing is down and MTFS and Entropy are certainly not looking too good. One should remain VERY cautious on these levels. A market fall on level breakout is a scenario which cannot be discarded.

Market Outlook SPY for Dec 20th '07

Dominant TF: 60mins & Daily
Swing: DN-DN-UP (from UP-DN-UP)
Cycles: up - good fit - low to average significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Swings oscillate a lot on all 3 charts, indicating a key level nearby.

60mins: congestion to only moderatly up
MTFS and Entropy indicate congestion to a trading range on this triple witching day. Slight upward bias.

Daily: support has been hit but congestion is likely, no excessive optimism just yet.
Same as the day before:
Bar is still red, MTFS and Entropy are not looking fantastic, so we have to wait for the support to be confirmed. MTFS lines being in median territory, there should be any major pressure either way, direction coming from line gradients.

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.
Swing is oscillating again indicating we might be close to a key level at this point in time. Caution should therefore be exercised.

Market Outlook NDX for Dec 20th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - low significance level
Market Direction: No strong rebound on 2000... NDX could go either way...

Again, it is more fun on 5 and 10mins time frames. Users of the technique generally select 2 or 3 time frames among 6 to determine the best trading environment.

60mins: directionless, slight upper bias
A priori nothing much to expect today but surprises are always possible on witching days.
After finding an intraday support at 2016, indicators point for a slight upward bias, aiming at crawling to Fib PR1.

Daily: congestion to down
We would like to be optimistic after 2000 has been hit, but swing is down, bars are red, MTFS and Entropy have negative gradients, so we'll have to wait a bit. 2000 looks strong enough for now, so congestion is likely.
One may also notice an MM octave (i.e. 8 sublevels between 2000 and 2125), so levels will be marked at 2131 and 2162.


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. We would be in trouble if 2000 would break...

A little break...

Not a bad time to take a break and enjoy quality time with the family.
There will therefore be no posting in the next 2 weeks unless some exceptional market move warrants it.

Please contact me however if you need an update or advice mailed to you.

cheers to all,
bv

Market Outlook RUT for Dec 19th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: UP-DN-DN (from DN-DN-DN)
Cycles: up - average fit - low significance
Market Direction: congestion with a lower bias, but caution on this key 740 level

Similar situation as SPY.

60 mins: Key level [740-750] needs to be confirmed
The market did not allow RUT to venture dangerously below 740, and then a good recovery late in the day after Entropy bottomed out.
Like for SPY, the MTFS crossover is not too exciting, so one would need a support level like 750 to be confirmed first.

daily: trading range is likely, but support must be confirmed.
No change from yesterday:
MTFS and Entropy are again weakening further. We have the final confirmation of the failed recovery pattern mentioned about 2 weeks ago. There are no signs of a recovery so RUT should fluctuate within the lower part of the [750-780] trading range. Should volatility increase, the range can be [740-790]

weekly: Same trading range [750-875] with lower bias. Caution must be exercised on key level.
Swing is down and MTFS and Entropy are certainly not looking too good. 740 is Fib PR2 (61.8%). RUT has always bounced on PR2 in the last 2 years, but one should remain VERY cautious still.

Market Outlook SPY for Dec 19th '07

Dominant TF: 60mins & Daily
Swing: UP-DN-UP (from DN-DN-DN)
Cycles: up - average fit - low significance
Market Direction: No change in overall direction just yet, but a support must be found soon

Swings turned up on 60mins and weekly charts, indicating a key level nearby.

60mins: congestion to only moderatly up
Like NDX, bears aimed at testing 143.75 and almost got there. The Low EntBin at the bottom gives good recovery potential but the MTFS crossowver is messy, indicating there could be a slowdown before going higher.

Daily: support has been hit but congestion is likely, no excessive optimism just yet.
Bar is still red, MTFS and Entropy are not looking fantastic, so we have to wait for the support to be confirmed. MTFS lines being in median territory, there should be any major pressure either way, direction coming from line gradients.

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.
Swing is oscillating again indicating we might be close to a key level at this point in time.

Market Outlook NDX for Dec 19th '07

Dominant TF: 60mins (and lower)
Swings: UP-DN-UP (from DN-DN-UP)
Cycles: long cycle turning up - low to avg significance level
Market Direction: No strong rebound on 2000

Again, it is more fun on 5 and 10mins time frames. Users of the technique generally select 2 or 3 time frames among 6 to determine the best trading environment.

60mins: No strong rebound on 2000.
After testing stall level early in the day, traders pushed the market down to 2000. However bears momentarily left their position after a quick skirmish on support level.
EntBin was at -3 at the bottom on 2000 but MTFS lines didn't cross in a "clean" way. NDX should stay in the same range and possibly test a support level again (2016?)

Daily:
2000 has been hit, but what next...? I'm afraid we have to wait a few more days (i.e. after triple witching). Like for the 60mins chart, we cannot expect any strong rebound.

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 18th '07

Dominant TF: Daily, 60mins as well as lower time frames
Swings: DN-DN-DN (from DN-UP-DN)
Cycles: up - average fit - average significance
Market Direction: congestion with a lower bias, but caution on this key 740 level


60 mins: Key level [740-750]
MTFS and Entropy are still pointing lower on this key level.
This support level should be fought, but no significant rebound expected before negative entropy is exhausted.
There is a support level at 734, but more generally: breaking 740 would be "dangerous".

daily: trading range is likely, but support must be confirmed.
No change from yesterday:
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.
Trading range in the [750-780] range to [740-790]

weekly: Same trading range [750-875] with lower bias
Swing is down and RUT is certainly not looking too good. 740 is Fib PR2 (61.8%). RUT has always bounced on PR2 in the last 2 years, but one should remain very cautious still. The next strong support level is indeed much lower....

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.