mcm-Alex

mcm daily market update 28.Feb.22

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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-Alex

mcm daily market update 25.Feb.22

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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-Alex

mcm daily market update 22.Feb.22

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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-Alex

mcm daily market update 18.Feb.22

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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-Alex

mcm daily market update 16.Feb.22

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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-Alex

mcm daily market update 7.Feb.22

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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-Alex

mcm daily market update 4.Feb.22

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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-Alex

mcm daily market update 31.Jan.22

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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-Alex

mcm daily market update 28.Jan.22

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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-Alex

mcm daily market update 27.Jan.22

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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.