mcm-Alex

mcm daily market update 8.Nov.21

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ST Trend: up

On Friday we were noting that the ST trend was (still) up, as sellers were very inefficient on FGSI. We also mentioned that the important lines on TTs would provide important clues when a reversal would finally show up. The market ended up pushing another ~30 points higher from our post, before finally reaching exhaustion and pulling back for the rest of the session. Once danny was broken on TTs, it was a clear sign a pullback is coming. The pullback was also 30+ points, after which the buyers managed to bounce into the close.

The action on Sunday and today in the am doesn't look very promising for buyers. Despite the news of the infrastructure bill passing over the w/e, price continued to consolidate in a limited range. It tested ML and bounced, but not convincingly and is still below the bounce high from Friday. Buyers also printed a bearish EE vs that high which held. On the other hand, sellers continue to show inefficiency on FGSI so considering that ML did hold, buyers still get the benefit of the doubt. If the bearish EE gets broken, that would be confirmation of more upside. If it continues to hold and we break below ML, that would be a sign a bigger pullback is in the cards.

mcm-Alex

mcm daily market update 1.Nov.21

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ST trend: up

On Friday we were mentioning that the ST trend was neutral as despite earnings misses from 2 heavyweights (AMZN and AAPL), the decline was contained. Price just came to test ML and sellers were unable to push too much below it. FGSI was showing both bullish and bearish EE in a sign that the ST trend was up for grabs. We did note that a breakout/down of that EE would signal that one side is taking control and that side was the buyers. As soon as 4575 broke, buyers pushed strongly and finished at the highs (new ATHs).

Sunday saw a continuation of the up move, with new highs being reached. We had an unconfirmed high on FGSI and pullback from there. That pullback was bought today and we are currently at new highs and ATHs again. FGSI is showing the "up squeeze" set up, as it's declining fast off extreme optimism, while the danny line is holding as support and price keeps making higher highs.

So the ST trend remains up, despite the ST overbought condition. The 1st signs that it will let up will be a failure of danny to hold price. Next support below that is 400bar MA and below that ML. We do have FOMC starting its 2 days meeting tomorrow and announcing its decision on Wednesday, so that will definitely be an inflection point timing wise.

mcm-Alex

mcm daily market update 25.Oct.21

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ST trend: neutral

On Friday we were mentioning that the ST trend was still up as sellers continued to be inefficient on eachpullback, while buyers kept pushing to higher highs. After the cash market opened we saw an initial drop, then a push to a new high, which was unconfirmed on FGSI and which was afterwards quickly reversed. The ensuing decline was very steep as we dropped 35 points in a vertical drop, before buyers stepped back in on extreme pessimism on FGSI and a 2nd sequential SE on TTs which also had an Xtick. That nailed the low for Friday and the market bounced right into the cash close.

Sunday saw a drop from those highs until FGSI hit again extreme pessimism zone (just barely), where buyers stepped in again and pushed price back right to the closing highs from Friday. The o/n today showed clearly that sellers are very inefficient (via FGSI) as every drop generated a big move in FGSI and as a consequence was quickly bought back up. It seems that the market is waiting for the cash session to decide on a clear direction. Above the ATH touched early on Friday and buyers could push another 15-20 points before finding resistance. As long as the ATH holds as resistance, sellers have a shot at pushing directly towards Friday's lows. Both TTs and FGSI currently give the upper hand to the buyers as all important lines on TTs (danny, 400bar MA and ML) are below price, while FGSI keeps showing sellers are very inefficient. So unless sellers step in on the cash open, we could see another push higher.

mcm-Alex

mcm daily market update 22.Oct.21

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ST trend: up

Yesterday we were noting that the ST trend was neutral, as both sides were showing inefficiency via FGSI. We were also mentioning that a ML breakdown was avoided by buyers and as long as that lvl continued to be defended, the buyers would continue to have the edge. And a break back above 400bar MA would suggest a run to the ATHs. That is exactly what came to pass. ML was defended twice during the cash session, 2nd time a SE also came to the rescue and buyers pushed from there right into a new ATH.

The o/n saw a choppy sideways session with initial pullback being bought and then price finally pushing to new highs. Buyers continue to hold the upper hand as the potential topping patterns on the GSIs keep getting busted. We are in a giant up squeeze since 13th of October, with very limited pullbacks, so once this momentum fails, the snap-back could be quite violent. However until ML fails in a sustained way, the main trend is still up and no reversal is confirmed.

mcm-Alex

mcm daily market update 11.Oct.21

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ST trend: down

On Friday we were mentioning that the ST trend was neutral, as both sides were showing inefficiency via FGSI. The session on Friday didn't do much to clarify things and we had a sideways chop day, but which did finish near the lows. Sunday saw prolonged weakness as price made significant new lows and tested the 4350 ES area.

Buyers did stage a decent bounce off those lows (FGSI had reached extreme pessimism), but the bounce looks weak and was subsequently sold. We did get a ML back-test which rejected price strongly, so things look pretty grim for buyers. We are at extreme pessimism again on FGSI, if they can step in again, then danny would be the 1st line to watch. Above that 400bar MA and, of course, ML is THE key line in the sand. Only if buyers manage to win back ML will the bearish character change. Otherwise the sellers would have the edge.

mcm-Alex

mcm daily market update 8.Oct.21

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ST trend: neutral

Yesterday we were mentioning that the trend was up with a potential topping pattern, as we had just finished an up squeeze and buyers were showing early signs of being inefficient. Buyers pushed higher after a whipsaw just before the cash open and we had yet another squeeze higher, before buyer finally exhausted themselves and we had a pullback in the 2nd part of the day.

The o/n saw no resolution. We kept whipsawing aroudn the same levels close to the cash close from yesterday. Buyers did manage to defend ML so far, but were not able to push price back higher. FGSI is showing that both sides are inefficient, so the ST trend is up for grabs. ML continues to be the key line in the sand for the ST trend, so on which side of ML price will settle after the cash open will be telling. Yesterday's HOD is important on the upside, while ML is a must watch on the downside.

mcm-Alex

mcm daily market update 1.Oct.21

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ST trend: down (with potential bottoming attempt)

Yesterday we were mentioning that the ST trend was neutral, as both sides were showing inefficiency via FGSI. We did note however that after buyers had won ML in the o/n, the decline off extreme optimism on FGSI saw ML being lost again. That was a warning the trend shift (back to up) was not confirming. The cash open saw ML being tested from below again, but it held as a brick wall and we got a big down day. The bounce attempt from noon was sold off hard into the close and cash session closed at the lows again.

This time however it seems the weak cash close was no longer a bear trap. The bounce off the weak close was VERY weak, and FGSI kept showing that buyers were inefficient on each bounce attempt. And each one was then sold off to new lows. Which brings us to the current set-up. The trend is clearly down, however we do have the potential in place for a bigger bottom. The last low was unconfirmed on both FGSI and IGSI. And even though the initial bounce off there generated yet another bearish EE which held, this time sellers couldn't push price to a new low. 1st step for buyers to do to confirm the attempted bottom would be to break the bearish EE level. After that the all-important ML test will likely be the next big inflection. As long as ML is overhead, the main trend is down, so no big bounce can come until that is won back. Below the unconfirmed low would break the attempted bottom and continue the pattern of lower lows.

mcm-Alex

mcm daily market update 24.Sep.21

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ST trend: down

Yeterday (same every day since Tuesday, actually) we were noting that the ST trend was up and the market delivered. We had a BE Xtick right off the cash open, which was broken out, and there was no looking back after that. The FGSI nicely hinted we could get an up squeeze set-up and that played out text book. The market finally peaked in the 2nd part of the day, also text-book for the FGSI up squeeze set-up, only after FGSI turned back up to mark an unconfirmed high.

From the unconfirmed high, the market pulled back pretty strongly, bounced, but the bounce showed buyers were inefficient and after that sellers took control. They broke to new lows and ran price into a ML test. A pullback to ML would be the normal expectation after an up squeeze set up, however it is a bit concerning that ML did not hold cleanly. Buyers had a decently bullish set up going into the ML test. We had bullish EE on both FGSI and IGSI, FGSI was at extreme pessimism (green zone). So they should have held ML more cleanly. But they didn't and this looks more like a breakdown with rejections at the back-test attempts. FGSI is showing buyers are inefficient, so the ST trend is down for now. Price is still in the vicinity of ML, so not all is lost for buyers. They can still stick save this, but they need to win back ML. And whatever they do, they MUST defend the bullish EE lvl on FGSI (it is at the same lvl also on IGSI, so double importance). If that lvl goes, then that would be seriously concerning for the up trend.

mcm-Alex

mcm daily market update 20.Sep.21

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ST trend: down (with potential bottoming attempt)

On Friday we were noting that the ST trend was neutral, as buyers were in the middle of a bounce from bullish EE on FGSI. They failed at the retest of the prior high and then kept painting bearish EE on each bounce, and they all held and pushed price lower. Those were clear indications that sellers are stepping back up. The cash open spike did the same, with a bearish EE forming which held. After that there was no looking back. Sellers sliced through ML and they were in control throughout the session. On Sunday we had continuation to the downside, as a feeble attempt at a bounce saw bearish EE forming and then lower lows.

The o/n session of today continued to show weakness. Bounces were small but leading to large FGSI moves. Danny kept rejecting price. With that being said, we do have a double unconfirmed low on FGSI and IGSI. And we do have MGSI in the green zone. These make the POTENTIAL for a bigger bottom. Potential is the key word. Buyers need to prove themselves by breaking above key lines (momo, danny, 400bar MA and eventually ML) and also break bearish EE levels on FGSI/IGSI. 3 additional things to mention:

  1. This is the same set-up on FGSI/IGSI/MGSI which we had at prior 2 OPEX dates. While "this time could be different", it's worth keeping in mind what happened last time.
  2. We are overshooting the 50DMA on daily and the lower BB. At least a snap-back bounce is probable. Reaction to that, especially if price retest ML, will be key for the trend.
  3. FOMC starts its 2 day meeting tomorrow, with the announcement coming on Wed evening.
mcm-Alex

mcm daily market update 13.Sep.21

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ST trend: neutral

On Friday we were mentioning that the ST trend was neutral as buyers managed to win back ML and sellers were also looking inefficient via FGSI. The cash open saw another BE (buyer exhaustion) early on and price was rejected very strongly there. Buyers lost ML which was the confirmation that the sellers are winning back control. Then the market flushed to new lows. Friday, unusual for a weekly close, ended the cash session at the lows.

We were noting that such a close is usually a bear trap, and it seems the market is confirming this hypothesis. Sunday saw a failed atttempted bounce and Friday's lows were tested again this morning early on. However that set up a 2nd consecutive unconfirmed low on FGSI in the extreme pessimism (green) zone. And buyers stepped in there and bounced hard. Sellers were very inefficient on the 1st pullback and buyers pushed higher again and won back ML. So again the trend is back to neutral. We have bearish EE set up, but also sellers are inefficient. So no confirmation either way. ML is the key level and price is above, so buyers have a slight edge here, but they MUST defend ML. If ML is lost, things can run south quickly, as we saw on Friday.