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mcm daily market update 07.Sep.21

ST trend: neutral

On Friday we were mentioning that the ST trend was up as sellers were inefficient on pullbacks, however did warn that if ML is broken, the bullish trend would come under question. Sellers did manage to break below ML initially and pushed price lower, but once FGSI reached extreme pessimism, buyers stepped back in. They bounced nicely to close about 10 points off the ATH going into the long w/e. On Sunday the market pulled back again, with FGSI reaching once more extreme pessimism and again buyers stepped in to push priceon the holiday Monday close to the ATH.

From the area close to the ATH we saw yet another pullback and FGSI bottomed here at extreme pessimism again. Buyers stepped in to buy this, however FGSI is showing they are inefficient. Additionally price is below ML, so for now, it looks like sellers have the upper hand in the Short Term. We still have bullish EE vs last time FGSI was at extreme pessimism, so if buyers manage to win back ML, then the odds would shift again. ML remains the key for the near term trend.

mcm daily market update 27.Aug.21

ST trend: down with bottoming attempt

Yesterday was the first down trend day in a while. Sellers managed to break below ML, decline stopped on a SE Xtick, but the bounce off there stopped on the ML back-test and price was rejected there. ML acting like that meant the ST trend was down and that's exactly what we got, as the market acted weak and closed at the lows.

The o/n saw price make another low, which was unconfirmed on both FGSI and IGSI. And buyers finally stepped in there and are attempting to bottom this decline. They managed to win back ML and if they can hold above and continue to bounce, the bottom might be in for the ST. There are bearish EE set-ups on both FGSI and IGSI, so holding ML is key. Buyers need to hold aboev and break the bearish EE lvls. Sellers on the other hand need to break below ML and break the unconfirmed lows.

mcm daily market update 23.Aug.21

ST trend: up

On Friday we were noting that the ST trend was neutral as in the o/n (ES was at 4385 at the time), both sides were looking inefficient via FGSI. We did warn however that "A sustained move above ML would reassure that the bottoming attempt from yesterday is playing out and the "OPEX scare" is over". Buyers did exactly that, broke the bearish EE lvl, won back ML and never looked back. We did not expect a large move considering the OPEX Friday, but apparently MMs were satisfied to keep just the big names (AMZN, AAPL) in check and the index ran regardless.

Sunday brought more bullish developments, as buyers continued the up move and broke the unconfirmed high that was registered on Friday on FGSI. They also broke the initial bearish EE lvl set-up on IGSI on the 1st bounce off the big low from last week. The only issues for buyers are the fact that the recent high is unconfirmed on both FGSI and IGSI; and FGSI is showing buyers are also inefficient on this bounce. Those things can still change if buyers continue higher, so they still look to be in decent shape. Ideally they would break the unconfirmed highs before getting a retrace to "cool off" FGSI and IGSI. Depending on whether they can do that or not, we will have more info. A ML test from here would be normal (especially since ML was pulled up by price and is likely not far below). The test should hold if this is to continue immediately higher. If ML breaks, then a deeper retrace could come, but in the larger picture it's hard to see how sellers can avoid new ATHs coming.

mcm daily market update 20.Aug.21

ST trend: neutral

Yesterday we were mentioning that the ST trend was down, with potential bottoming attempt. That played out as expected, as buyers stepped in and pushed prices higher, avoiding the most bearish scenarios for the time being. The market rallied hard, pulled back around mid day, then bounced to close the cash session near the highs.

The o/n saw a pullback from there, with a grind lower. FGSI is showing both sides are inefficient, with large swings in both directions, but on small price movements. So the ST trend is up for grabs. Buyers did manage to keep this decently elevated and comfortably above yesterday's lows, which is a positive for them. However ML is still above as buyers couldn't hold the breakout above it from yesterday's session. As long as ML is overhead and acting as resistance, the buyers are not out of the woods. Yesterday's low is a KEY level for buyers to avoid a potential deeper correction. A sustained move above ML would reassure that the bottoming attempt from yesterday is playing out and the "OPEX scare" is over. Speaking of which, being a Friday OPEX, a large move in either direction is probably not going to happen and the market could whipsaw in both directions, but not really make any real price progress by the close. Just something to be aware of.

mcm daily market update 19.Aug.21

ST trend: down (with potential bottom attempt)

Yesterday we were mentioning that the ST trend was down, as price was still below ML and FGSI was showing both sides were inefficient. The market continues to chop between the bearish and bullish EE on FGSI, and even tried to break above ML after the cash market open, but failed to do so. Once the FED minutes were released it tried again to break above ML, but we got a completing signal on TT, with a Buyer Exhaustion (BE) right at that spike high, which was just above ML. It rejected price strongly and even though buyers stepped in after another TT signal (a SE Xtick), the bounce off there made a lower high and then sellers took complete control.

The o/n saw more downside and even lower lows made, which was to be expected given the big confirmed lows on FGSI and IGSI at the cash close yesterday. However now we do have the potential set-up for a meaningful bottom. Both FGSI and IGSI show unconfirmed lows, while MGSI touched the extreme pessimism area (green zone). That is potentially an explosive set-up for upside. The key to this set-up materializing is ML. If buyers manage to break above ML, then sellers need to be careful as a massive face ripping rally could ensue. If ML rejects price, then we might see more downside. Buyers want to defend those unconfirmed lows and avoid them from turning into confirmed lows. On the other hand, sellers must defend ML at all costs to have a shot at lower lows.

mcm daily market update 16.Aug.21

ST trend: down

On Friday we were mentioning that the ST trend was up, with potential pullback set-up, as FGSI was at extreme optimism. The pullback was small, then the market pushed to new highs in a very choppy session. It also made a new ATH after hours. The Sunday session saw a pullback from there (the ATH was marked as unconfirmed high on FGSI).

The current o/n saw continuing weakness and what is interesting is that for the first time in a while, the buyers were not able to lift prices back to new highs out of FGSI trips to extreme pessimism. What is more worrying for the buyer side is the fact that 2 unconfirmed lows on FGSI were subsequently broken. That usually marks a shift in market character (i.e.to something more bearish in our case), so it's a big warning that buyers are no longer in full control. ML was also broken by price and now appears to be holding as resistance. That also confirms a more bearish ST picture. Going fwd, it is important to see how price acts in relation to danny and ML. For buyers to get back in control, they must break back above ML. if they can do that, this might be another failed breakdown from seller side. However if ML continues to act as resistance and price continues lower, this might be the 1st trend down day we had in a while. This week is OPEX so shake-outs in both directions are to be expected. Considering that markets are so extended, a bigger pullback would not be out of the question (1st target 4408-4415 - large fractals on 60 and 135min cycles. Below that - 2nd target is 4370-4380 and the bottom of the prior trading range).

mcm daily market update 13.Aug.21

ST trend: up (with potential pullback set-up)

Yesterday we were mentioning that the ST trend was up, with a potential topping pattern, as both FGSI and IGSI were showing unconfirmed highs. The market did pullback from there and even overshot ML for a brief period. FGSI reached extreme pessimism and as usual buyers stepped in there with authority. They won back ML and after that there was no looking back, market going straight to new ATHs.

In the o/n price went sideways and unlike the previous sessions, we had almost no pullback. The new unconfirmed high on FGSI from yesterday' session was broken and ES just made a new ATH. FGSI is at extreme optimism again, so a ST pullback is to be expected, however buyers have been extremely strong and the trend is up, so unless danny or 400bar MA fail to hold as support, it is dangerous to try to anticipate a turn. Once these do fail, it is likely we will see another ML test, but until then - the trend is up.

mcm daily market update 10.Aug.21

ST trend: neutral

Yesterday we were mentioning that the ST trend is neutral, as both sides were inefficient via FGSI. Since then we had spikes higher and lower, but price went basically nowhere. Yesterday's cash session did finish higher vs Sunday's o/n, so up grind is still holding.

The o/n brough the "usual" vertical price drop which pushed FGSI to extreme pessimism, where buyers stepped in. Price went then back to where it used to be. In conclusion, it seems to be "steady as she goes" as price keeps grinding higher with the ocasional steep drop. ML is still below price and being defended, so until sellers can break below and sustain a breakdown the ST trend is up.

mcm daily market update 02.Aug.21

ST trend: neutral

On Friday we were noting that the ST trend was down with bottoming attempt. Buyers did manage to hold those unconfirmed lows on FGSI and pushed higher into the cash open, before grinding and giving up some of those gains in the 2nd part of the session.

The o/n from Sunday and today saw buyers stepping in again and pushing prices back to the 4420 area. That zone has been a brick wall of resistance so far, price being rejected every time it got there. Today same thing happened with price dropping abruptly fro mthere right into an ML test. What happens from here is important for the near term. ML is key for the trend, as we keep repeating. Buyers would want to see ML holding and pushing back above danny and 400bar MA to put in a successful ML test. If danny or 400bar MA reject price, then another attack on ML is likely, while an ML breakdown would put sellers in the lead. We do have an unconfirmed high on FGSI at the recent o/n high, so a bigger turn could shape up from here, but it depends on whether ML can be broken on a sustained basis or not.

mcm daily market update 23.Jul.21

ST trend: up (with potential ST pullback)

Yesterday we were noting that the trend was still up, as sellers were inefficient, but were warning that a pullback could be coming to test ML as FGSI was showing an unconfirmed high. That is exactly what happened. The unconfirmed high on FGSI led to a pullback into a ML test. The test held quite comfortably (ES never touched ML, while YM overlapped it briefly) and from there the buyers launched another push higher.

The o/n saw continued upward pressure as buyers kept making higher highs, while sellers were inefficient on pullbacks. The main achievement of the buyers is that now they finally broke the initial bearish EE level on IGSI. They also broke the closer unconfirmed highs on FGSI and turned them into confirmed highs. Price is also very close to the ATH, so the trend is clearly up. For the immediate term, we do have FGSI at extreme optimism, so a pullback could happed anytime from here. However, it depends how price will act on the TT lines (momentum, danny and 400bar MA). As usual, if danny gets broken, then a trip to 400bar MA below would be expected. If that also gets broken, then another ML test might be in the cards. As long as these lines hold, we could continue higher with only shallow pullbacks, depending on how FGSI shapes up. IGSI has a lot of room fwiw.