mcm daily market update 16.May.22

ST trend: neutral

On Friday we were noting that the ST trend was up as buyers had rallied off unconfirmed lows and won back ML, while sellers were very inefficient on pull-backs. We did mention that while the low looked unresolved (3 waves in EWT terminology), the key lvl to break for sellers was ML. They were unable to do that, despite 2 additional attempts and buyers kept the trend intact, also pushing above macro-ML.

Sunday saw new highs being reached, which stayed unconfirmed and had a pretty large pullback (60 points) all the way into another ML back-test. It held again, however so far buyers were unable to push back towards the highs and price keeps hovering in ML vicinity. So for the moment, the trend looks to be up for grabs, neither side being in complete control. FGSI is also showing that both sides are inefficient. ML remains the key lvl to watch, as long as it is below price that should keep buyers afloat.

mcm daily market update 12.May.22

ST trend: down (with bottoming attempt)

Yesterday we were noting that the ST trend was up as buyers had regained ML and sellers were inefficient on the pullbacks. We did mention that CPI release is "likely to cause some spikes and finally give the direction for at least the 1st part of the day. Overall the market remains weak as any bounce, even large ones, continue to get sold hard. Buyers need to break resistance, then start holding supports on pullbacks to reverse the big trend. Otherwise any bounces are sells.". That played out exactly. The CPI release caused a massive drop erasing all the gains buyers managed to build. The it stopped at the 3950 support lvl and staged an impressive bounce into the 1st hours of the RTH open. After that buyers failed to hold ML and we sold off to new lows.

The o/n continued the bearish character and dropped to lower lows. Buyers are attempting to stick save 3900 and FGSI stubbornly refused to confirm the lows. We now have 3 consecutive unconfirmed lows on FGSI as well as an unconfirmed low on IGSI. So there is at least a bottoming attempt ongoing. Buyers must defend those lows and break the 1st bearish EE lvl to confirm at least a ST low is in. Otherwise the unconfirmed lows set-up can get broken and we continue to sell off.

As a side note - it looks like markets are gripped by extreme fear. It is likely we are going to need a capitulatory action before we find a more meaningful low. As repeated for weeks already, the intermediate target for this down move is, in my opinion, in the 3600 range. That's not even that far anymore as it's "only" 300 points from where we are. Considering that we already dropped from 4600 at the end of March and the brutal sell-off in many stocks, this is likely the initial stage of a bear market. We should get a larger bounce after this capitulatory low, but new ATHs are unlikely to happen for a very long time.

mcm daily market update 02.May.22

ST trend: neutral

On Friday we had another full-on bearish day, similar to the previous week action on Thursday-Friday. After a gap down, which was never completely filled, buyers were overwhelmed and we sold off for the entire RTH session, dropping a whooping 150+ points from prior day's close.

Sunday made the usual lower low, although it was a minor one, with buyers managing to defend that area 3 more times and bouncing, albeit not very convincingly. FGSI is showing that both sides are inefficient, so the ST trend is up for grabs. Fwiw, the bounce looks rather weak, so it is possible we might need another leg lower before a real bottoming attempt. On the downside the o/n LOD is important as it was unconfirmed on FGSI so if buyers can defend it it could be the start of something. On the upside, ML is the key line in the sand, as usual. 400bar MA and danny are also important and it seems buyers are having a hard time holding price above them, which is a further sign of weakness. Bigger picture we could have a capitulatory low today, so in case we do see another flush, watch for reversals (having a lower low which is unconfirmed on both FGSI and IGSI from which price bounces strongly would be a good indication buyers are trying to find a bottom).

mcm daily market update 25.Apr.22

ST trend: down (with bottoming attempt)

On Friday we were noting that the ST trend was down with potential bottoming attempt, as we had the potential for a bottom with FGSI and IGSI showing unconfirmed lows. We warned that "The absolute KEY level for buyers to defend is the o/n low. Below that likely opens up the flood gates again and we could see a repeat of yesterday". Our warning came true, after losing the o/n low, there was no looking back as the flood gates opened again and same type of action as the prior day happened - non-stop selling with little bounce along the way.

Sunday opened even lower (as expected and called out in the chat room on Friday) and we dropped another 40+ points from Friday's close. The o/n today continued even lower. Now we again have the potential for a bottom, as IGSI is not confirming these lows. Price made a double bottom at the o/n low and buyers defended it, staging a bounce, however FGSI is showing buyers are inefficient on this bounce, which is capped by the 400bar MA so far. It looks like we have the same situation as Friday. If the o/n low is broken, then it's possible we will get yet another leg down, similar to Thursday and Friday. If buyers can defend, then we might see a larger bounce, maybe to test ML. Ultimately, it looks like the market has a date with the mid March lows, so the expectation would be for us to see that area before this series of declines stops (at least for a while).

mcm daily market update 22.Apr.22

ST trend: down (with potential bottoming attempt)

Yesterday we saw one of the biggest reversal ever recorded. After the RTH open, buyers pushed higher strongly and triggered a BE on TTs which marked the top. After that, markets took the "elevator down" as price just dropped in a steep manner all the way until the RTH close. Pretty unreal price action and HUGE trap for buyers.

The o/n saw the usual "lower low" which was unconfirmed on both FGSI and IGSI and buyers attempted a bounce there. However they stalled at the back-test of the area where a bottom was attempted yesterday near the RTH close. And it looks like they failed there, as now the lost momentum and price is back below both danny and 400bar MA. The absolute KEY level for buyers to defend is the o/n low. Below that likely opens up the flood gates again and we could see a repeat of yesterday. On the upside, buyers would need to overcome the o/n HOD area (4395ish) to have hopes at touching the next inflection area at ML and macro-ML.

mcm daily market update 20.Apr.22

ST trend: up (with potential topping pattern)

Yesterday we were noting that the ST trend was neutral, with potential bounce coming, as FGSI had set up both bullish and bearish EE, but was at extreme pessimism, indicating at least a ST bounce. Buyers took full advantage of that though and after the initial failure at ML, rocketed past ML and macro-ML in a giant vertical move. We also had another push into the close, before the market finally gave up and dropped quite strongly to the prior consolidation area.

The o/n didn't bring too many developments. Buyers held the consolidation area where price stayed after the initial rocket launch and then buyers managed to psh back towards yesterday's high. This is now a big inflection point. If buyers can power through we will likely get more immediate upside. If they fail and price comes back below danny, then a consolidation down to 400bar MA or even ML is possible. FGSI did peak again at extreme optimism, so at least a ST pullback would be warranted.

mcm daily market update 8.Apr.22

ST trend: up (with correction ongoing)

Yesterday we were noting that the ST trend was neutral as we were still in the prior day's range (from the FOMC minutes spike high and low) and having bearish and bullish EE vs those levels. Sustained breakout/down of those levels was needed to escape the range. Initially we saw a rejection at the upper level, then buyers lost ML and we went down all the way to test the lower end of the range. That held as well and after being marked as an unconfirmed low on both FGSI and IGSI, the buyers stepped in with authority and put in a larger bottom.

The o/n played out well for buyers. We had the usual sideways consolidation from the yesterday's RTH highs, but sellers couldn't even touch ML on the pullback. And then a push to new highs. Now we have an ongoing correction from the higher high, which was marked as unconfirmed on FGSI and IGSI. The pullback again couldn't touch ML, which means buyers are still in good shape. We also had a large bullish EE set up on FGSI. As long as buyers hold price above ML, they are in control of the trend. Yesterday's ramp fixed a lot of the technical damage inflicted in the prior 2 days and if today ML is not lost, it's likely we are dealing with a new found up trend.

mcm daily market update 04.Apr.22

ST trend: up

On Friday we were noting that the ST trend was neutral, as both buyers and sellers were inefficient via FGSI. We did mention that "the bounce is a slow grind and is looking more like a bear flag than a change in trend" and warned that losing the bullish EE lvl set up on FGSI and the important ST lines (danny and 400bar MA) would "If those levels break, then another trip to the lows is likely". That is exactly what happened as buyers failed and the market dropped to new lows. The bottoming attempt near 4500 was caught nicely by FGSI which showed a 2nd consecutive unconfirmed low there, before buyers stepped in for the usual late Friday rally.

The o/n showed a decent continuation of the bounce, as the initial pullback was small and more a side-ways consolidation, then we had another push to new highs, then a pullback from extreme optimism on FGSI, but which set up bullish EE that held. Now we are back near those highs (which are testing macro-ML), but with sellers showing inefficiency. ML was won back also and if it continues to act as support, buyers could get a follow through day until the next inflection area - 4580.

mcm daily market update 01.Apr.22

ST trend: neutral

Yesterday we were noting that the ST trend was down as buyers were showing inefficiency via FGSI. Additionally they attempted to win back ML, but failed to hold above it. We did mention that "ML remains the key level for the trend and if it continues to reject price, that would point to another leg lower". That is exactly what played out. ML rejected price and we dropped into a macro-ML test. Macro-ML was also lost towards the end of the RTH session leading to another 40 point flush.

The o/n saw the usual bounce off extreme pessimism on FGSI. However the bounce is a slow grind and is looking more like a bear flag than a change in trend. However not all is bad for buyers. Sellers keep showing inefficiency and actually set up bullish EE on FGSI. Buyers also keep holding 400bar MA as support. If buyers can defend those levels and win back ML, that would be a serious warning they are ready to take the lead again. If those levels break, then another trip to the lows is likely.

mcm daily market update 29.Mar.22

ST trend: up (with potential topping pattern)

The market has continued the melt-up started in mid March with each ML break down attempt being stick-saved quickly and ML being recovered easily after that. Yesterday was the same as prior 2 days. ML test in the o/n, bounce into the o/n highs, then drop into RTH session to lose ML briefly, but recover it again and then squeezer higher once more.

The o/n saw continued follow through for the buyers. Only sideways consolidation, FGSI showed sellers were VERY inefficient as it declined to centerline on almost no price pullback. Then push to new highs. Right now we do have an unconfirmed high on FGSI and IGSI, which has the potential to mark a larger top. The key word is POTENTIAL. As long as danny holds and/or 400bar MA, the up trend is intact. Sellers need to show up and defend those unconfirmed highs, then break these 2 supports (which held throughout the entire o/n). Once that happens another ML test would be likely and that would be the key for the trend, as always.

mcm daily market update 23.Mar.22

ST trend: down (larger correction attempt)

Yesterday we were noting that the ST trend was up as buyers had held another ML test and bounced off it. Indeed from our post, the market consolidated briefly, then ramped another 50+ points to breach 4500. The RTH session was a "ramp 'n camp" as after the initial push, there was a choppy slow grind.

The o/n saw a pullback from those new highs and we again had buyers being inefficient, which was a warning they might not be able to sustain such a relentless push. And now we dropped into yet another ML test. As we kept mentioning, ML is the KEY level for the main trend. If buyers can win back ML, then this is just another small dip to be followed by new highs. If ML is lost on a sustained basis, then a trip to macro-ML (aprox 50 points lower) is possible and likely next large inflection point.

mcm daily market update 16.Mar.22

ST trend: up (with potential topping pattern)

Yesterday we had a huge reversal day and up squeeze. FGSI and IGSI both signalled an unconfirmed low at the o/n LOD, and those have the potential to be explosive set-ups. Yesterday didn't dissappoint, for sure. After the o/n LOD was touched, the market went straight up with little to no pullbacks. During RTH we had a drop and retest of macro-ML, but that was quickly brushed off and mkt rocketed to new highs to close near HOD.

The o/n was perfect for buyers. We had almost no pullback with price going only sideways after which another push higher started. FGSI is starting to show extreme overbought conditions as price is pushing into sell zones, but the buyers seem very determined and just push higher and higher. Sellers on the other hand are VERY inefficient, tiny pullbacks in price lead to big declines in FGSI, which means they are likely to continue to get squeezed. The 1st step for sellers would be to break below the danny line. As long as that holds as support, the immediate up trend is intact. Once danny fails a pull-back to back-test ML would be expected. There we will have the next big inflection point. If the newly found up trend is to be kepy, ML needs to hold. FOMC today, which should provide fireworks, large moves expected. As usual the "real" direction after FOMC will be seen only tomorrow and with this week being OPEX, that just means more volatility and wild swings in both directions expected.

mcm daily market update 14.Mar.22

ST trend: down (with potential bottoming attempt)

On Friday we were noting that the ST trend was up with potential topping pattern, as FGSI and IGSI were at extreme optimism and near term the market was overextended. We mentioned that as long as danny is supportive to price more upside is possible and indeed once danny was lost, the upside momentum dissappeared. We also mentioned that "In order to keep the new found up trend intact, buyers would need to hold ML on any potential back-test". And ML was lost as well and price fell another 50 points from there. The market also closed at the lows not having the usual late Friday ramp.

Sunday saw an attempted bounce, which failed near ML, and today's o/n saw a proper test of ML which even made it to macro-ML, but failed there. The rejection at ML and macro-ML means the downtrend is still intact. FGSI is at extreme pessimism which indicates a ST bounce is possible, however as long as ML is above price, the main trend is down. Friday's low is important on the downside. It held on Sunday and also today, if it breaks it would likely trigger the next leg lower.

mcm daily market update 11.Mar.21

ST trend: up (with potential topping pattern)

Yesterday we were noting that the ST trend was down with potential bottoming attempt as FGSI continued to show unconfirmed low set-ups. We did mention that ML and macro-ML were the key levels for the trend and that proved once again true. Price continued lower, back-tested ML, rejected to new lows, then had a larger bounce off RTH open to test macro-ML, rejected there and pushed once more to new lows. Buyers managed to take control after that, as FGSI continued to refuse to confirm those lows and had a very impressive bounce to win back ML and macro-ML.

The o/n had a head-fake drop below macro-ML and ML, which was quickly bought to new highs. Then another ML back-test before it continued higher. Buyers were already making good progress and got and additional help from Russia as apparently "positive progress" in the talks with Ukraine is worth a 60+ point ramp. We are in an extended situation near term as both FGSI and IGSI are at extreme optimism, however danny continues to act as support for price and as long as that happens more immediate upside is possible. In order to keep the new found up trend intact, buyers would need to hold ML on any potential back-test.

mcm daily market update 9.Mar.22

ST trend: up (with potential topping pattern)

Yesterday we were mentioning that the ST trend was down as price made lower lows in the o/n and buyers had stepped in to push a bounce into a ML back-test. We noted that what would happen at ML would be important. Price was indeed rejected at ML, went lower to test the o/n lows, before staging a very impressive rally all the way to macro-ML. Then the market did the same as the prior day (similarities to which we noted as well). It went to macro-ML and failed there quickly after, lost ML on the way down and came back to the lows, erasing almost the entire pop.

The o/n proved once more that the market likes to trap both sides in this high VIX environment. The close near the lows was a trap and the market ramped 90 points o/n. Buyers won back ML again and erased almost the entire drop. The action is likely to remain volatile (with VIX at 35+ it's no surprise) and even if buyers managed to step in hard, the next inflection (area near yesterday's HOD and macro-ML) is important to keep an eye on. If price stalls there and buyers fail to make head-way above macro-ML, then we could see yet another trip to the lows.

mcm daily market update 7.Mar.22

ST trend: down (with bottoming attempt ongoing)

On Friday we noted that the ST trend was down as sellers pushed prices to lows at the all important 4280 lvl and then rejected price at ML. We mentioned that ML might be back-tested again and also that "bounces are sell opportunities, until proven otherwise". Both came to pass, ML was back-tested and price rejected there once again and sold off to retest the lows, before bouncing back near ML, holding there until the close.

Sunday saw yet another gap down and flush move, as the optimism that the Russia-Ukraine conflict would get solved over the w/e didn't come to pass. We broke Friday's o/n lows and reached 4240 before buyers finally stepped in and bounce price right back to ML. Now we are directly in a big inflection area at ML. Buyers overshoot it, but failed to put some distance to it. So this can be yet another ML back-test which rejects price. ML has proven to be a brick wall of resistance so far, so that would not be surprising. If buyers manage to hold price above ML and keep pushing higher to put some distance to ML, then we might have at least a ST bottom at the o/n lows. Next could of hours and especially how market acts after RTH open will be key for that.

mcm daily market update 4.Mar.22

ST trend: down

Yesterday we were noting that the ST trend was neutral as both sides were inefficient via FGSI. The latter was showing a potential large divergence set-up, which normally points to a large decline (80-100 points). It didn't play out exactly, as the prior high was surpassed, but it proved to be correct in the end. We did mention "4400-4420 area has a lot of resistances (classic TA - descending trend lines, 200DMA and BC on daily) and is a VERY tough nut to crack, so risk/reward doesn't favor longs here". The market stopped right near 4420 and then dropped 100+ points.

The o/n proved that sellers were indeed in full control. It dropped to test the important 4280 support and bounced 80 points, with buyers attempting to win back ML, but failing spectacularly after that. Now buyers are attempting to hold the area near the prior higher low from the o/n and FGSI is showing a potential unconfirmed low here. That doesn't mean the decline is over, but if buyers do manage to step in here (break above danny would help), then we might see another ML back-test, which would then be the big inflection point (ML is key for the near term trend). For now sellers are in control, at least until buyers can win back ML on a sustained basis. So bounces are sell opportunities, until proven otherwise.

mcm daily market update 28.Feb.22

ST trend: neutral

On Friday we were noting that the ST trend was neutral as the market had consolidated in the o/n following the push on Thursday and was back-testing ML. We did mention that "As long as buyers hold ML, they could continue to push higher immediately" and that played out nicely. ML held price and buyers pushed to gain macro-ML as well, which had a text book back-test before the final push upwards. Mkt closed Friday' session at the highs, which proved to be a bull trap.

Sunday opened with a huge gap down based on the escalation to Russia-Ukraine conflict and the 1st use of the words "nuclear deterrent". Despite the big gap down, sellers didn't accomplish too much, as buyers managed to step in and stick save ML. Further on, sellers dropped the ball as FGSI showed they became inefficient on pullbacks. ML continues to be the KEY line in the sand for the ST trend. If buyers can continue to hold it as support, this can go to RTH gap fill which will be the next upper inflection point. Alternatively, if sellers manage to break below ML and take out the 1st bearish EE level (just below ML), then that would indicate that this decline wants to go deeper.

mcm daily market update 25.Feb.22

ST trend: neutral

Yesterday we were mentioning that the ST trend was down with potential bottoming attempt. At the time we were testing the unconfirmed low on FGSI and it looked like the final low wasn't in yet. But buyers held that low (narrowly) and after the RTH open never looked back. We had a huge up day and TTs showed us that the mkt character changed, as danny held as support all day. Buyers had a huge win reversing the entire large gap, winning back ML and actually ending the day very green. Price finally stopped at the macro-ML test.

The o/n saw the expected pullback to ML, as the mkt was very extended immediate term (FGSI at extreme optimism and sell zones on its chart). Buyers held ML so far, which is constructive for higher prices. For today the situation is pretty straight forward. As long as buyers hold ML, they could continue to push higher immediately. If ML is lost, then a deeper pullback is possible. Buyers do not want to see this heading much lower than 4200, with 4150 being the MUST defend lvl (bullish EE on FGSI vs that level).

mcm daily market update 22.Feb.22

ST trend: up

The market had some wild swings both ways since Friday's close. As the cash market was closed for the holiday on Monday, the algos had some fun, making a lower low on Sunday, then 80-100 points up, down and up again. At the end we are close to Friday's cash close, so for cash traders not much happened, but they missed one heck of a rollercoaster ride.

The low was hit yesterday on a drop to 4250 ES, then buyers stepped in and after a retest of that low in the o/n today, they pushed price 100 points higher and won back ML. That is a significant achievement. Of course, it depends if this time around they can actually hold above, since they managed to spike above it also early on yesterday, before the huge rug pull to new lows. That is the key line in the sand for today. If price holds above ML, we could have a large low in place (cash traders that tried to sell Friday will be very annoyed, no doubt). Adding to that potential is MGSI which hit extreme pessimism (prior trips there triggered large bounces - 150+ points). If ML is lost, then buyers need to be cautious as that could imply another trip to the lows, especially since IGSI is showing bearish EE again (which triggered yesterday's huge sell off). For now buyers have the edge, as price is above ML, they just need to not drop the ball (like yesterday).

mcm daily market update 18.Feb.22

ST trend: down (with potential ST bounce attempt)

Yesterday we were noting that the ST trend was neutral as both sides were inefficient via FGSI and ML was being whipsawed in both directions. We did mention that "ML is still a key level so if one side manages to sustain a move above/below ML, that would be important to consider". The market obliged. Once ML was lost on the downside, sellers never looked back. Price grinded lower the entire RTH session with only a feeble bounce attempt late morning, which was quickly exhausted and we closed at the lows.

The o/n proved once more that closing at the lows is a trap, especially during OPEX week. We bounced from the lows right into a ML test. ML capped price with ease and the market kept making lower highs, until it finally plunged on yet another Russia headline. The biggest problem for buyers is that this decline was so large that it took out yesterday's lows (which were unconfirmed on FGSI). So while FGSI is at extreme pessimism and could trigger a near term bounce, because the lows are confirmed now, more work is likely needed before finding a bottom. Bigger picture, sellers are in control until ML is won back in a sustained way. Today is OPEX, so expect whipsaws in both directions. Due to the large drop from yesterday, market makers might be incentivised to push this higher, just something to be aware of.

mcm daily market update 16.Feb.22

ST trend: neutral

Yesterday we were noting that the ST trend was up, as buyers had won back ML and despite FGSI reaching extreme optimism they kept pushing higher. The RTH session was less bullish than the o/n, as buyers were not able to continue to push, but it was a gap 'n camp with price consolidating sideways in a tight range. However buyers did manage to hold above ML, which was important.

The o/n today saw even more sideways action. Buyers did manage a new high on the European open, similar to yesterday, but that spike was sold and we are back where we were before it. Price also back-tested ML (which was dragged higher), so we have a key level near-by. As long as buyers can hold ML, we can see higher prices being attempted. If ML is lost, then a deeper consolidation would likely be in play with the 4420 lvl being 1st area to keep an eye on and the 4395-4400 area being the MUST hold for buyers.

mcm daily market update 7.Feb.22

ST trend: neutral

On Friday we were noting that the ST trend was down, with potential bottoming attempt, as we had an unconfirmed low on FGSI and buyers were attempting to bounce from that area. We mentioned danny and 400bar MA as being important near term, while ML test being the "real test". Buyers did manage to test macro-ML after breaking danny, but were quickly rejected there. However they managed to hold a higher low vs the unconfirmed low and then staged a very impressive rally to win back macro-ML and ML, before peaking in the same 4530-4540 area. The decline into the RTH close was vicious and broke back below ML.

Sunday's session didn't do much, price whipsawed around ML neither side being able to make the breakout/down stick. Today followed the same pattern, with price spending actually more time below ML than above. Nonetheless buyers are attempting to breakout again now. We have both bullish and bearish EE on FGSI, so those lvls are important to confirm the direction after price moves away from ML.

mcm daily market update 4.Feb.22

ST trend: down (with potential bottom attempt shaping up)

Yesterday we were noting that the ST trend was down, with a bounce attempt, as buyers had put in another unconfirmed low pattern and bounced off there, but putting in bearish EE. We mentioned that ML remains a key level and key it was, as it capped price on every bounce attempt and then mkt was sold to new lows. The market acted very weak yesterday and there wasn't even a gap fill attempt and it closed at the lows.

That close proved to be a bear trap at least for half of the o/n session. AMZN came out with decent earnings and given that it was sold brutally yesterday (was over -8% at some point), ES ramped almost 60 points on the news. However, the big problem for buyers is that ML contined to cap price action. We had an initial test right off the AMZN news and ML held. Then after catching their breath for a bit, buyers tried again, but failed at ML once again. After that there was no looking back and we dropped to take out yesterday's lows. Another unconfirmed low attempt, but after the 8:30 NFP numbers also this bounce failed and we just took out the o/n lows. Going fwd, things look pretty bearish. Yesterday's RTH action was clearly bearish. And the o/n retracing the entire ramp off AMZN news is also horrible for buyers. It remains to be seen where the market would find suppor. Danny and 400bar MA are important near term. And if buyers can find their footing then ML will be the real test.

mcm daily market update 31.Jan.22

ST Trend: neutral (potential ST bounce underway)

On Friday we were noting that the ST trend was down, with potential bottoming attempt, as price kept making lower lows after losing ML and despite hitting extreme pessimism on FGSI several times. We did mention that once danny gave way the bottoming attempt would be confirmed and indeed once danny failed to cap price, buyers pushed it all the way into a ML back-test. Initially ML held, but buyers managed to make a higher low on the pullback from there and then broken above ML convincingly. We did get another ML back-test (from above this time), right before the "famous" late Friday ramp.

The o/n action since Friday's RTH close was as text-book as possible. Pullback after hours on Friday, then another push to minor new highs on Sunday, highs which remained unconfirmed on FGSI. Then pullback from there and another test of the highs on Monday before finally giving up and having a pullback into a ML test. ML is the key line in the sand, as usual. Buyers want to hold ML and bounce this back to the highs area to have hopes at another push higher. FGSI hit extreme pessimism on this ML test, so they have a decent chance at that. On the other hand, sellers need to break below ML. Capping price either at danny (ideally for sellers) or at least 400bar MA is what sellers want to see. FGSI is already showing buyers are inefficient on this bounce off ML, which is not what they wanna see. If ML is lost, buyers would need to make a stand at macro ML or at the 1st bullish EE lvl (the low where the Friday late ramp started).

mcm daily market update 28.Jan.22

ST trend: down (with potential bottoming attempt)

Yesterday we were noting that the ST trend was up as sellers were inefficient via FGSI, buyers had won back ML and FGSI was refusing to move to extreme optimism. We mentioned " there is a lot of room on FGSI to push prices higher before it reaches extreme optimism and signals a ST pullback". The market obliged once more and price pushed all the way to 4420 before FGSI finally reached extreme optimism. Buyers lost control there and we had a very strong pullback which sliced through ML in a big warning that buyers are in trouble.

The o/n looks quite bearish so far. Price whipsawed ML for a while, but buyers again lost the battle and once it started coming lower, the action was as bearish as it can get. Each bounce was capped by danny and despite FGSI hitting extreme pessimism and even attempting to put in unconfirmed lows, the market kept making lower lows. Now we have a confirmed local low on FGSI after breaking several unconfirmed lows, so it would seem more work is needed before finding a meaningful bottom. Danny is the big line in the sand for the immediate term trend. As long as it continues to act as resistance, price can continue to make lower lows.

mcm daily market update 27.Jan.22

ST trend: up

Yesterday we were noting that the ST trend was up with potential pullback starting as FGSI was coming back from extreme optimism and was showing unconfirmed highs. We did get a few whipsaws, then a proper pullback into a ML back-test before continuing back higher. We also warned that due to FOMC large swings in both directions were likely while waiting for the decision. The market obliged. Additionally we mentioned that the announcement itself is likely to trigger a very large move, while the 1st move is usually fake. The market also obliged on both. We saw a spike 3min after the announcement, then the market waterfalled more than 100 points to reach 4300 again.

The o/n saw an early attempted bounce which tested ML from below and then the market sold off to new lows. The lower lows were unconfirmed by FGSI and that triggered another large bounce (typical action). Buyers got price back above ML and FGSI is showing that sellers are inefficient. So the trend seems to be back to up. Buyers need to hold price above ML to avoid any doubts. As long as that happens, there is a lot of room on FGSI to push prices higher before it reaches extreme optimism and signals a ST pullback.

mcm daily market update 24.Jan.21

ST trend: down

On Friday we were noting that the ST trend was down, as the market continued to act weak. We also warned that "Large bounces are possible, but are likely to be good selling opportunities, while attempting to buy dips is extra risky. Dust should settle after OPEX, so the timing window for a potential important low would be Monday or Tuesday". That proved to be the case, as the large bounce off the RTH open back-tested ML and was rejected there strongly. Market then fell almost 100 points from that ML test to close near the lows.

On Sunday, buyers managed to step in and push price a bit higher, but then hit a brick wall near 4425 and stopped. Today's o/n action pushed once again in that 4425 lvl and got rejected and proceeded to break Friday's low. We are now in the timing window we considered for a low - today or tomorrow. While it does no seem the low is in yet, another large drop today could reach capitulation on the buyer side and then see a strong bounce. FGSI shows a confirmed low on the last low, so that will likely be taken out before an important bottom is found. We also have FOMC this week and Powel speaking on Wednesday, after the FOMC announcement. That could be a potential catalyst for another trendy move. So for now the ST trend (as well as the main trend) is down. Play accordingly until the market shows us a change in that character.

mcm daily market update 21.Jan.22

ST trend: down

Yesterday we were noting that the ST trend was neutral as price was testing ML, so it was decision time. Breakout would get an up squeeze while rejection would lead to immediate downside. We did get the breakout and a large up squeeze right into macro-ML. However, as we warned yesterday "Ultimately, it seems likely that we have unfinished business on the downside". The market rejected hard at macro-ML and buyers did have a feeble attempt to defend ML, but failed and after that there was no looking back. The market lost a whooping 100 points after ML was lost.

The o/n continued the pattern of the last few days. Instead of seeing an acceleration and breakdown, it put in yet another attempted stick save. Price made a lower low, which was unconfirmed on both FGSI and IGSI and the cue to start an attempted bounce. This one, although looking similar to the one from yesterday, didn't make it to test ML yet, so from that perspective looks weaker. Today is OPEX so there was always the prerequisites to have many shennanigans, but with VIX so elevated and markets in a very fragile state after these aggressive declines, whipsaws both ways are expected to be larger than normal. So reducing size and being extra nimble is required if wanting to actively trade. Same as yesterday, it doesn't seem like the market found a stable low just yet, despite the large decline. So the main trend is still down. Large bounces are possible, but are likely to be good selling opportunities, while attempting to buy dips is extra risky. Dust should settle after OPEX, so the timing window for a potential important low would be Monday or Tuesday.

mcm daily market update 18.Jan.22

ST Trend: down (with bounce attempt ongoing)

Friday saw large whipsaws in both directions. After a decently large gap down (30+ points), buyers stepped in and managed to fill the gap. Then the opening low was tested and finally broken, after which the last 2h of the session saw the "usual" late Friday ramp to take out the highs.

The o/n today saw a big "rug pull", as buyers are seeing a 60+ point drop from Friday's highs. That area was tested several times, but macro-ML capped price and finally once buyers lost ML, we had a large flush to take out Friday's lows. Buyers are attempting to reduce the large gap and with FGSI and IGSI at extreme pessimism that was to be expected. So bounce is ongoin ghere, however as long as ML is overhead, sellers have the upper hand. The o/n low is confirmed on IGSI and locally on FGSI, while FGSI is slightly unconfirmed vs the low from yesterday's late futures session. So even if a bounce is likely here, sellers are still preferred, until buyers can prove themselves by gaining efficiency on FGSI and winning back ML.