US market commentary

Market commentary for 05/31/2007

Good day!
The bulls are back!!! Yesterday's action showed that even after the strong pullback we saw in the market last Thursday, we still didn’t have a short signal. The market found strength yesterday, with the SPY and the DIA saw new daily highs. The QQQQ still has a bit of a way to go to see its' previous high. The day started with a gap down into Tuesday's low. That brought concern for the possibility of selling, especially in the QQQQ, which could have easily become a trap. Because of that, my main focus at the open was to scan for possible trap charts. Our PAY trade was a textbook trap chart. After the initial weakness in the market, the rest of the day was reserved for the bulls.

http://www.ivicacharts.com/diagrams/2007/05312007dia.jpg
http://www.ivicacharts.com/diagrams/2007/05312007spy.jpg
http://www.ivicacharts.com/diagrams/2007/05312007qqqq.jpg

On the 60 min charts, we can see a nice comeback with a strong pace that finished with new intraday highs and new daily highs for the SPY and the DIA. Both broke to just a slightly higher high, however a new high nonetheless.

http://www.ivicacharts.com/diagrams/2007/05312007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/05312007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/05312007qqqq60.jpg

More importantly right now is that the close would indicate more buying throughout the morning. The weekly chart supports this action, but we can’t forget last Thursday's selling volume, which adds some caution to this action. I still think that we could see a scenario for a strong daily move up on large volume, which could signal the end of the weekly uptrend. The number of open long swings waits for that scenario. My focus hasn't changed. I will continue to look for intraday moves, and still believe that we are in a higher risk environment right now. The reason for that is the possibility of double top patterns especially if yesterday's volume doesn't support the long side. Volume is important now. If we see a strong move up, it must be supported with volume as that will prove that buyers are truly interested in new highs- not just slightly new highs or range action. If we will have that proof for a daily breakout to new highs, I will look to add positions to our open trades.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/01/2007

Good day!
The month is over. On the monthly charts, we can see that we have another green bar that closed at highs. This chart shows us the market strength. The larger time frames are always very important to recognize market breathe. We have had a very strong market the last few months and we must respect that. It was much easier to trade on the long side than the short side, which is quite clear when looking at the charts.

http://www.ivicacharts.com/diagrams/2007/06012007diamonthly.jpg
http://www.ivicacharts.com/diagrams/2007/06012007spymonthly.jpg
http://www.ivicacharts.com/diagrams/2007/06012007qqqqmonthly.jpg

For me it is always important to scan using the monthly charts because that helps me to find future swing/day trade ideas.
Yesterday the indices spent all day in consolidation. We can see a continuation pattern on the daily charts with enough room for another move up before we have any resistance. Only the QQQQ had resistance from it’s' channel line. For trend day traders yesterday was a very difficult day as range day trading is quite different than trend day trading.

http://www.ivicacharts.com/diagrams/2007/06012007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06012007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06012007qqqq.jpg

If we take a look at the 60 min charts we can see clearly yesterday’s range action. It will be best if the Indices can stay in yesterday's range (blue lines) until the 20sma, which will bring the support needed for a possible move up. We can see consolidations forming right at the daily highs, which also shows the resistance areas and we must respect that.

http://www.ivicacharts.com/diagrams/2007/06012007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06012007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06012007qqqq60.jpg

Yesterday's highs and lows are very important areas now. A break to new highs with volume can lead us to a strong move up which is what I mentioned in yesterday's commentary. On the other side, a break under yesterday's low can lead to a daily double top pattern, and that can cause more consolidation or stronger correction. That is still not a short setup for me, but certainly must be a caution signal for open trades. Also it is important to know that most trend days came after narrow range days and that is the situation we have on the daily charts. On the trend days, it is important to mark the 60 min high/low, because lots of times a break above/below the 60 min high/low will determine the trend direction. All those reasons will keep me in watch mode today at the open. The market is strong and my bias is bullish, but before any we see any breakup to new highs, there is a possibility we could see more of a correction.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/04/2007

Good day!
For the second day in a row, the market had a range day. The day started with a gap up that indicated the possibility of buying pressure. If you remember in the last commentary, I mentioned marking the 60 min high/low. You can see why that is important if you look at Friday's action. After the first 60 minutes, the Indices saw new lows and we trended down for half of the day. It was a slow trend down and not the kind of action I like to trade. It was a signal, however, for open long trades. The market is still strong and the weekly/monthly charts show that. Friday just wasn’t ready for more action.

http://www.ivicacharts.com/diagrams/2007/06042007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06042007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06042007qqqqweekly.jpg

On the daily charts, we didn’t see much change. We had slightly new highs with a range-type action. The QQQQ channel resistance still held.

http://www.ivicacharts.com/diagrams/2007/06042007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06042007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06042007qqqq.jpg

If we look at the 60 min charts, we can see that the 20sma is still holding. This support is very important for the possibility of a move up. If we won’t see a bounce from that support area, we could then see the possibility of more intraday correction and weakness.

http://www.ivicacharts.com/diagrams/2007/06042007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06042007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06042007qqqq60.jpg

Overall my bias is the same. The market is strong and I will look for more buying pressure. I will follow that 20sma 60 min area and that action will tell us what we can expect. We are again in the situation where all options are open. Either the uptrend can continue or a consolidation can begin or we could even start with a reversal. We don’t have a clear signal at this point. Right now we have no other option then to follow Monday morning's action and see what we will get. If the Market goes up, we will be ready for new opportunities. If we should continue with this consolidation, then patience will be necessary. I don’t see a short signal and right now it is dangerous to try to pick a top to short. That is always a risky game before we see confirmed reversal patterns. If we do see a reversal pattern then our bias can change. Until then the bulls will continue to rule.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/05/2007

Good day!
When we look at the Indices yesterday, we can see that we had a 3rd range day in row without any significant changes. The day started with a gap down to intraday support areas and still within the 60 min ranges. The QQQQ and the SPY bounced from the open to the middle of the range, while the DIA needed more time for that. Eventually the DIA filled its' gap too, and closed near its' range high, as did the QQQQ and the SPY.

http://www.ivicacharts.com/diagrams/2007/06052007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06052007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06052007qqqq.jpg

The 60 min chart clearly shows us yesterday's range continuation, and also, more importantly, illustrates how all the indices closed above their 20 sma support areas.

http://www.ivicacharts.com/diagrams/2007/06052007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06052007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06052007qqqq60.jpg

Yesterday's close gives us hope today for a possible long continuation. All the Indices closed near their range highs and above their 20sma support area. For that pattern possibility, we want to see a strong breakout pace with higher volume. This will be prove that the market wants to go higher to new yearly highs. Monthly/weekly charts support that possibility and that will be my focus in the morning. Of course, everything depends on the market open. If the range action continues, then trading will contain to remain at high risk and we will look for a scalp market continuation. We had a nice day with individual names and that will stay the same if the market chooses not to breakout. Generally, nothing has changed. We must follow the market action with a bullish bias. I still will look for a strong breakout possibility. The short side continues to be reserved for individual names and intraday setups.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/06/2007

Good day!
The Indices changed roles yesterday with the QQQQ being the strongest and the DIA being the weakest. The day started with a gap down to the 60 min range support area. After this opening weakness, the QQQQ tried to fill its' gap, but the DIA and the SPY's weakness didn’t help in that mission. On the 60 min chart, we can see how important the 20sma area is. The last few days that area held and the Indices showed strong support, but after yesterday's opening below the 20sma that area became resistance. The DIA and the SPY couldn’t break through it and fill their gap in the morning. In fact, the 11:00 reversal period brought more selling to new intraday lows.

http://www.ivicacharts.com/diagrams/2007/06062007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06062007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06062007qqqq60.jpg

If we take a look at the 5 min charts, we can see that the 200sma on the indices held the morning action and prevented the gap to fill. Lots of time when we have range/whippy action in the morning, as we did yesterday, we can expect an 11:00 reversal period. This also applies to when we have a trend in the morning . This 11:00 reversal period is one of the most important reversal period that I follow every day. On the 5 min charts, we can see that the Indices tried to hold the morning losses, but around 11:00 am EST they moved to new lows.

http://www.ivicacharts.com/diagrams/2007/06062007dia5.jpg
http://www.ivicacharts.com/diagrams/2007/06062007spy5.jpg
http://www.ivicacharts.com/diagrams/2007/06062007qqqq5.jpg

After these new lows, the Indices started with consolidation until another important reversal period at 15:00 pm EST. You can see that the indices started with a move up. The QQQQ closed its' gap before the end of the day while the weaker SPY and the DIA couldn’t break above their 200sma 5 min and 20sma 60 min resistance area. If we look back at the 60 min charts, we can see that only the QQQQ stayed in a range. The DIA and the SPY's 60 min charts show more of a rounding high, which could lead to more indecision today. Because of that action, we had a divergence in the market that added risk to yesterday's trading.
On the daily charts, we don’t have much change and the 10sma is still holding. The DIA chart looks tired and the buying pace is slowing down, but that does not mean that we don’t have the strength for another bounce to new highs. The same applies to the SPY. The QQQQ is holding best for now.

http://www.ivicacharts.com/diagrams/2007/06062007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06062007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06062007qqqq.jpg

Generally, nothing has changed. My bias is still on the long side, however, it look like the market needs some rest. We still don’t have a reversal signal so I am still not looking for a swing move down, however, the weakness is good for intraday moves. Summer is close and we can expect more days like yesterday, so we must prepare for less opportunities then usual. But situation is not bleak as we will always have opportunities. My focus is on "own way" trades, like CMI yesterday. I will still look for another breakout with a strong pace, but if doesn't happen the “own way” charts will still be found thru my scanning, and intraday % lists.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
 
Market commentary for 06/07/2007

Good day!
The Bears came out in force and took control of the market. That is the short explanation of yesterday's action. The day started with a gap down. The SPY and the DIA's opened near Tuesday's low, while the QQQQ remained the strongest. Even still, it couldn’t bring the whole market to fill the morning gap. Once Tuesday’s lows were broken, there was more selling pressure.

http://www.ivicacharts.com/diagrams/2007/06072007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06072007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06072007qqqq.jpg

The SPY and the DIA closed under their 20sma daily support area, which is a very important area for a trending chart. The QQQQ is now the strongest and closed above its' 10sma on the daily chart. I still think that we could see another chance for a strong bounce and move up in to new highs, but right now that is more of a guess than something that the technical analysis is showing. I will keep this as a possibility; however, if we look technically, we can expect more selling pressure today. I would expect the selling to be in the morning, but nothing too strong. We can see that the Indices are near previous lows on the daily charts, which is the support area now. Also on the 60 min charts, we can see that we had three selling waves and can therefore expect a correction on the 60 min charts.

http://www.ivicacharts.com/diagrams/2007/06072007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06072007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06072007qqqq60.jpg

Because of that, I will look for a reversal on the 15/30/60 min charts today, after the possibility of some morning selling pressure. Since I think that the bears need a rest for a day or two, new shorts will be higher risk right now. Faster, scalp-type trades are less risky in this type of environment than day and swing trades. Generally, if we look at the daily charts, we can see that the bulls are loosing steam. If we don't see a strong bounce soon, we have a higher possibility of starting a daily/weekly consolidation (correction). This, after several months of an uptrend move, could bring more difficult trading in the future days/weeks.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/08/2007

Good day!
The uptrend on the daily charts is over. After yesterday's strong selling the DIA and the SPY closed under their previous daily lows, indicating that the uptrend is over. The day started with a gap down and the Indices filled that gap right at the open. That was it from the bulls yesterday. The rest of the day, we saw strong selling pressure. Three things are important when we look at daily charts. First is the breaking under the previous low (the DIA and the SPY), second is volume (higher then average volume) and the third is the selling pace. We can see that the selling pace is stronger then the buying pace into highs, which indicates that the bears took control.

http://www.ivicacharts.com/diagrams/2007/06082007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06082007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06082007qqqq.jpg

On the 60 min charts, we can clearly see this selling pace. The indices broke under their 200sma strong support area, without any rest.

http://www.ivicacharts.com/diagrams/2007/06082007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06082007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06082007qqqq60.jpg

The indices closed at lows and I will look for more selling pressure at the open, including the possibility of a gap down. However, we will see what happens at the open. Right now new short trades are high risk because the market is extended and needs a rest. The daily CCI on the DIA is already in an oversold area (-252) and the SPY is near that area (-193) as well. Remember that oversold can become more oversold so without an intraday reversal pattern, it is a high-risk game to try to pick a bottom. The SPY is close to its' 50sma on the daily chart, which is the next strong support area. I will expect that area to hold the selling pressure for now. The DIA and the QQQQ still have room to get to that area. Because of that and with yesterday's close, I will expect selling pressure in the morning. Since shorts are risky now, the best plan is to follow the intraday market action for a reversal. We don't know if we will see that reversal or not, but with Friday as the last day of the week, there is a possibility that traders will look to protect short trades into the weekend.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/11/2007

Good day!
Yesterday's action was in line with expectations. The day started with a small gap up. A gap of that size will usually be filled in the morning, which is exactly what happened on Friday. After that, we saw the expected weakness and a bounce to the open area. We saw a consolidation and tight range action until the 13:00 EST reversal period, when the Indices started to bounce. We had a stronger bounce then I anticipated, but the action was still in line with my overall expectations. On the 60 min charts, we can see that the SPY and the DIA closed right under their 200sma, which is their stronger intraday resistance area, while the QQQQ found resistance at its' daily 20sma.

http://www.ivicacharts.com/diagrams/2007/06112007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06112007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06112007qqqq60.jpg

After the end of the week, it is always good to take a look at the weekly charts. We can see how the 10sma is an important support area when we have a strong trend. The \indices found support there and strongly bounced from it. The QQQQ looks the strongest and like it is only taking a rest, but we still have to consider the strong volume and the red bars. This tells us that the Indices need a rest, as explained in Friday’s commentary.

http://www.ivicacharts.com/diagrams/2007/06112007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06112007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06112007qqqqweekly.jpg

We can see that clearly on the daily charts. The QQQQ is holding its' daily uptrend line (blue line), but the SPY and the DIA definitely lost it, and will need more time for a possible recovery. Yesterday action is telling us that we shouldn't expect a selling continuation to new lows today, but that doesn't mean that we won’t see a pullback to daily lows.

http://www.ivicacharts.com/diagrams/2007/06112007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06112007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06112007qqqq.jpg

The SPY and the DIA still have strong intraday resistance areas at their 200sma 60 min. The QQQQ has its 20sma daily as resistance. I will expect that this will hold for today. It will all depend on the morning's action, but I won’t be surprised if we stay in a range of Friday's high and lows. There is also a possibility we see more upside pressure until the SPY and the DIA see their 20sma daily resistance and the QQQQ sees it’s daily highs. However it turns out, one thing is for sure, and that is we will have higher risk for swing trades until the market finds direction again. After two big daily bars we need some rest for low risk setups. That is the usual market action; move-rest-move so now we need rest. Those who follow me know this is the basic action and everything is based on that. In the rest period, risk will increase for swing trades and faster intraday moves will be favorable. Focus will be, as always, on the strongest and weakest names, and on the “own way” charts. We can only respond to the action we see in the morning. The only scenario I am not expecting is that we will see new daily lows in the morning. Nothing is for sure, however, so be careful and reduce size and the number of trades.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/12/2007

Good day!
We saw a slower day until the 13:00 pm EST reversal period. At that time, the DIA and the SPY touched their daily 20sma resistance area. This served as too big of a resistance after Thursday's selling pressure. The 14:00 pm EST reversal period was the next important area, where the QQQQ gave up all of it’s' morning gains and closed the day in negative territory. The market was stronger today then I expected, but it looks like the Indices have started a daily triangle formation and after yesterday's bar, my expectation is for more indecision. I really don't expect much strength today but rather more action between the 20sma (blue line) and the 50sma (green line) on the daily charts.

http://www.ivicacharts.com/diagrams/2007/06122007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06122007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06122007qqqq.jpg

From the intraday charts, the QQQQ (60 min) traded as expected, at least in the morning. The selling pace was stronger than the buying pace and that could result in more selling. The 20sma and 200sma are the next strong support areas. The SPY and the DIA are at their 200sma and their next support area (20sma) is very close, so there is not much room for a move. I will expect the action to trade between the resistance and the support areas. In other words we can expect to see action between yesterday's high and Friday’s low, which could result in a daily pattern where swing trading will again be plausible..

http://www.ivicacharts.com/diagrams/2007/06122007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06122007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06122007qqqq60.jpg

If the Indices break in any direction without a daily consolidation, then the risk will increase for swing traders. Right now, it looks like the Indices are starting to form a daily consolidation and a strong possibility for a triangle. Without clear direction, swing trades will be higher risk, and “own way” charts will again be the best option. The focus will be on intraday moves and own way charts, as we saw in BCSI yesterday.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
 
Market commentary for 06/13/2007

Good day!
Tuesday's action was as expected based on the daily and the 60 min charts. Both Thursday's low and Monday’s high held. The action stayed between those two areas. However if we look at the 15 min charts, we can see very whippy action after the afternoon breakout. Let’s start with the daily charts. ALL is clear here and the support areas are still holding. The SPY looks the weakest and is back to its' 50sma daily support area. That is a very important trend support area.

http://www.ivicacharts.com/diagrams/2007/06132007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06132007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06132007qqqq.jpg

My expectations from yesterday's commentary proved true with regard to the 60 min charts. Both the resistance and the support areas held. This is something that I will look for today as well.

http://www.ivicacharts.com/diagrams/2007/06132007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06132007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06132007qqqq60.jpg

For educational purposes, it is interesting to look at the 15 min charts, which illustrate why the reversal periods can help us in our trading. We can see a nice breakout around the 13:00 pm reversal period. The breakout pace was strong and we saw an equal move to the resistance area. After that pace we usually see a consolidation for continuation (base, triangle, flag), but this time the 14:00 pm EST reversal period brought a different kind of activity. We saw a strong selling pace into new lows for the SPY and the DIA. The QQQQ held its' morning lows. This is the reason why it is always good to follow these reversal periods and have your eyes open for any possibility.

http://www.ivicacharts.com/diagrams/2007/06132007dia15.jpg
http://www.ivicacharts.com/diagrams/2007/06132007spy15.jpg
http://www.ivicacharts.com/diagrams/2007/06132007qqqq15.jpg

We have a few reasons for the strong whippy intraday action. One is the consolidation after last week's strong daily move down. It is usual to see a consolidation after that. It is also the start of a possible daily triangle action, and in future days, we should see lower highs and higher lows. Another reason is option trading week, which always brings whippy action. There are two ways to trade this kind of market. One is to use bigger stops then usual. Second is to not trade at all and wait until the market takes its breather. Every trader will determine what is best for him but one thing is for sure and that is market risk. This risk is high right now and I will expect that it will stay this way for the rest of the week. Use proper risk, don’t be greedy and be quick to take profits. Remember that cash is a position too. Sometime it is the best position to have.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/14/2007

Good day!
This is option trading week and with it comes the whippy market action we have been seeing. One day everything is red and the next day everything is green. After the morning gap up, the Indices spent the morning under selling pressure in an attempt to fill the gaps. The pace of the selling was not impressive but led to a more active 14:00pm EST reversal period. This time we saw a nice afternoon move up into Monday’s high and the daily resistance areas. For the QQQQ, it was the 10sma daily resistance area, while for the SPY and DIA it was the crossing of the 10 and 20sma area. Even though this is not good for more upward action, it does not mean we can’t see another move up into daily highs. The QQQQ's strength has more of a possibility of that than the SPY and the DIA.

http://www.ivicacharts.com/diagrams/2007/06142007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06142007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06142007qqqq.jpg

On the DIA and the SPY 60 min charts, we can see a nice reversal head and shoulders pattern and a move back into the previous high resistance area.

http://www.ivicacharts.com/diagrams/2007/06142007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06142007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06142007qqqq60.jpg

With the daily resistance and the intraday pace, I don’t have a bias for today. I think that it will all depend on the morning's action, but from my experience, option week tends to not be the easiest to trade. Because of that, I won’t be surprised to see a gap down in the morning and a move up to new highs after that. Of course, that is just one option. Right now, it is best to trade small and be ready to exit a trade any time the market turns around. Swing trades are going well for now, but it is important to not be at full risk with them. If I would have to bet, I would say that the Indices will move back to the daily highs, however, I will leave all options open.
If you have any questions, please feel free to contact me.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/18/2007

Good day!
Unfortunately Friday’s action was in line with expectations. The day started with a nice gap up that brought our open swings to new highs, however, that was it for Friday. The Indices spent the rest of the day in a tight range, which was really not worth trading. It was a typical summer option expiration Friday. This is always a good time to look at the weekly charts and review last week's action. We can see from the charts that the Indices recovered after last week's weakness. Even the QQQQ almost made new highs Friday morning. The volume in the recovery was strong. The SPY's buying volume was stronger then its' selling volume the week before. From that, we can make a conclusion that the market had a nice recovery week.

http://www.ivicacharts.com/diagrams/2007/06182007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06182007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06182007qqqqweekly.jpg

All that sounds great but one thing makes me very cautious and that is the volume on the daily charts. If we look at the daily charts the red volume is greater then the black volume, and that means on the selling days the volume was larger then on the buying days. That tells me to maintain caution in the future days. After the strong recovery from the daily lows, a double top pattern is very possible right now.

http://www.ivicacharts.com/diagrams/2007/06182007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06182007spy.jpg
http://www.ivicacharts.com/diagrams/2007/0612007qqqq.jpg

If we look at the smaller time frames, (60 min), we can see that the indices are extended. For an ideal break up, the Indices need several days of consolidation near the highs. In addition, we can see Fridays range action.

http://www.ivicacharts.com/diagrams/2007/06182007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06182007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/0612007qqqq60.jpg

In conclusion, I think that we are entering a week of uncertainty. The range action, and in this case the NR7 bar, means that we can expect a trend day on Monday. That sounds great, but which way? I think we cannot have a bias either way because we not only have higher daily selling volume and a double top possibility, which would indicate a down trend, but the double top can always turn into a higher high and a trend up. The weekly charts are still strong and a selling week can just amount to the market taking a breather before a new run. If that happens, I don’t see low risk setups because the Indices are extended now. The best thing for us is to look for is intraday (day trades) moves. If we have a consolidation day, it could be the start of a daily cup and handle pattern. So, all this indicates we are entering a trading week of uncertainty. What the market does is something we cannot control, however, we can adjust our risk management and the number of trades, using patience until we will see a more clear market direction. It is logical that new swing trades are higher risk and it will be best to stick with intraday moves and "own way" charts. Swing traders that don’t like that kind of action must continue to use patience. That would mean scanning and researching for future possibilities and being less active then in the last few weeks.
If you have any questions, please feel free to contact me
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/19/2007

Good day!
We had another slow trading range day. I can just cut and paste yesterday's commentary and everything is the same. So, there is little new to say. One thing is for sure, and that is we didn’t have a trend day. But, after another range day, we have three options for the open: The same start as yesterday, the possibility of a daily double top or the possibility of a daily cup and handle with continuation to new highs.

http://www.ivicacharts.com/diagrams/2007/06192007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06192007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06192007qqqq.jpg

Intraday we saw divergent action. The QQQQ was the strongest, forming a nice 60 min triangle and closing at the same price as last week. The SPY and the DIA were weaker and closed lower. Both are forming 60 min bull flags.

http://www.ivicacharts.com/diagrams/2007/06192007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06192007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06192007qqqq60.jpg

When we look at the daily and the 60 min charts, we can see that all options are open with the same probabilities. If the Indices form daily cup and handles then we can look for possible swing patterns. If we see the other possibilities, the best approach is for day trades. Since we still don’t have a cup and handle pattern, it means we don’t have any swing setup possibilities on the daily charts. This means risk will stay higher, and the focus will continue to be on intraday actions.
If you have any questions, please feel free to contact me
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/20/2007

Good day!
For the second day in a row, the QQQQ closed flat without any change. The DIA and the SPY closed with just a small change. This tells us a lot about yesterday's market action, especially, when we look at the daily charts. During the last three days, we can see that we had range days with little change and with declining volume. This action is a consolidation after the bounce we saw from the previous daily lows. Right now, we can see that the Indices are starting to form cup and handle patterns, which are ideal for a breakout. The best case scenario for that would be for the Indices to stay in their ranges for a few more days.

http://www.ivicacharts.com/diagrams/2007/06202007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06202007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06202007qqqq.jpg

On the 60 min charts, we can see the consolidation of the last three days more clearly. The SPY and the QQQQ are forming a base, while the DIA are forming a bull flag.

http://www.ivicacharts.com/diagrams/2007/06202007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06202007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06202007qqqq60.jpg

The risk hasn't change. While the Market continues with this consolidation, we will have high risk trading. The best way to handle this is to stay with the strongest and weakest charts for possible intraday moves. For now our open swings are doing great, however, it is important to continue to compare them to the market action and use trailing stops to cut risk.
If you have any questions, please feel free to contact me
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/21/2007

Good day!

Is the party over???? For the immediate future the QQQQ, SPY and the DIA all broke immediate support. The 20 sma and the 200 sma on all the intraday time frames were broken leaving the 20 sma on the daily as the next support area. The market was weak all day with the selling accelerating after the 2pm reversal period and the volume and pace also increased dramatically.

Looking at the market fundamentally, stocks started the day with Morgan Stanley and Home Depot reporting excellent news with the futures gapping up. The initial selling started when the crude and gas inventories both came in significantly greater than expected. The price of oil started to drop immediately and significantly. This started the selling in the oil and energy issues but lower oil prices should have a bullish effect on stocks. It did not. The 10-year bond barely sold off but the selling continued. The only reason that can be put on the day was the two hedge funds failing from Bear Stearns which many blame might spill over into the overall market. Financials and Utilities both got crushed yesterday.

For now the 20 sma daily will be the initial support for the market and the 200 sma 15 min and the 200 sma 60 min will be resistance. My bias for today is perhaps a small gap down on the open and then the markets will consolidate or rest before the next move down. Until earnings season gets going in a couple of weeks the market will react daily news reports.

For now new short positions have additional risk and I will look to exit any long positions still open. I will look for "Own Way" stocks and day trades today in the trading room. Swing trades have additional risk. I will trade smaller positions and look at shorter time frames today.

If you have any questions, please email me or ask me in the trading room.

Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/22/2007

Good day!
Yesterday's action was exactly in line with expectations. That was a weak morning and then recovering from the strong daily support areas. For the QQQQ daily 10/20sma are still support areas and last few days it is the strongest. Reversal pace is strong with nice daily volume. The SPY is the weakest index and is back to the 50sma daily support area, which held yesterday. The reversal volume is nice also. It was the same with the DIA. Yesterday's volume was stronger than the selling volume Wednesday, which is promising for the long side.

http://www.ivicacharts.com/diagrams/2007/06222007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06222007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06222007qqqq.jpg

On the 60 min charts we can see reversal pace. The DIA and the QQQQ reversal pace is strong for now. The same as the selling pace which will suggest more range action in the near future. The QQQQ looks best while the DIA still has problems with the 20sma. If we look at the SPY on the 60 min chart, we can see it is the weakest. The reversal pace is weaker than the selling pace and it is still under the 20sma on the daily chart. It is also under the 20/200sma on the 60 min chart. I think we can expect more weakness there in the near future if it doesn't move back above the 10/20sma on the daily chart.

http://www.ivicacharts.com/diagrams/2007/06222007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06222007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06222007qqqq60.jpg

The QQQQ looks the strongest and looks ready for new highs. The SPY looks weaker and looks like it wants new lows soon. Because of this situation we could see divergence action today. We don’t have synergy and in that case risk will increase. Also from the 60 min charts we can make a conclusion about possible range action the few next days. That is in line with daily charts. I expect another day for fast trades and intraday moves with up/down action which we had yesterday. The trading room is the best way to trade that kind of market. I will try to find the strongest and weakest names and compare them with market action and look for intraday setups. That way we can have a profitable day despite the market action. Own way stocks, like HURN are always welcome and always will be in my focus. They come from comparing stock action with market action.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Market commentary for 06/25/2007

Good day!
Last week was interesting in the it began with a couple of range days at the weekly highs which gave us an opportunity for new highs, but after Wednesday's weakness specifically on the DIA and the SPY the market closed at the weeks lows. On the weekly charts we can see the DIA and the SPY are back to the 10sma support area, while the QQQQ was is the strongest index and is still above all its daily moving averages. We can also see the weekly consolidation continued after several months uptrend. The weekly volume is another important point to consider. It was stronger than the average volume which indicates we have more selling interest right now. The best reason I heard for the selling was large funds were liquidating to buy into Blackstone. (Yea right!!!!)

http://www.ivicacharts.com/diagrams/2007/06252007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06252007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/06252007qqqqweekly.jpg

The weakness can be seen more clearly on the daily charts. The QQQQ is still in cup and handle formation, while the DIA and the SPY lost that possibility. The SPY closed under 50sma support area and has additional room to the previous low support area. Another important point is that the SPY made lower daily high which indicates it will be more difficult to see new daily highs soon. For the DIA that is daily double top, another indicator for future upside possibilities.

http://www.ivicacharts.com/diagrams/2007/06252007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06252007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06252007qqqq.jpg

The 60 min charts just confirm the weakness differences between the QQQQ on one side and the SPY and the DIA on the other side. The QQQQ is only one still above 200sma and the selling pace is the weakest there.

http://www.ivicacharts.com/diagrams/2007/06252007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06252007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06252007qqqq60.jpg

If we only watch the QQQQ we can still hope for another move up to new highs, but can the QQQQ bring others with it? Looking at the weekly and the daily charts and volume they lost the strong daily supports (10/20sma). It is hard to believe we will see that soon. From a trading perspective I still don’t see a swing short setup and I don’t see evidence we are in down trend market. For that we must see new a daily low. Right now, I think that Indices will continue with their weekly consolidation. If we look back to the weekly charts we don't know what kind of consolidation or correction this will be. Maybe it will be a base or maybe we will have a strong reversal or even perhaps a slow reversal (bull flag). It just is to early to tell. Swing trades can expect higher risk over the next several months (summer) and we probably will see lots of daily overlap. Of course that is just possibility for now, but that is what charts telling me right now. We just don't know where will market is going from this point, but we can recognize risk. Since we lost the daily/weekly trend and since the trend is what we need for trading (I’m trend trader). Without trend the risk will increase and that is case right now. My focus will be on “own way” trades, and on intraday moves. Nothing changes from that side. I will compare market action and individual stock actions to determine the strongest and weakest names for intraday opportunities. We will must be faster with taking profits and we can expect less opportunities. That does not mean we wont have any. For now we must go day by day.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
 
Market commentary for 06/26/2007

Good day!
The markets had a wild ride to finish almost unchanged for the day. While the indices finished a little lower on the day you can see that they tested support and bounced slightly finishing above the daily support. The DIA and the SPY (more clearer) are in a double bottom possibility. That means the Indices are already on the move and future action is a little more predictable.

http://www.ivicacharts.com/diagrams/2007/06262007dia.jpg
http://www.ivicacharts.com/diagrams/2007/06262007spy.jpg
http://www.ivicacharts.com/diagrams/2007/06262007qqqq.jpg

Looking at the intraday charts (60 min) we can see yesterday's action which was more interesting than the daily charts. After open weakness the Indices bounced strong on higher volume. They touched the 20sma which is always the stronger resistance area (on every time frame chart) and the reaction was very strong. We got strong selling pressure and a move to new lows. That was the third selling wave on the 60 min charts. On the DIA and the SPY charts we can clearly see how the previous low held yesterday's selling.

http://www.ivicacharts.com/diagrams/2007/06252007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/06252007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/06252007qqqq60.jpg

After the daily double bottom possibilities, support areas and after three selling waves on the 60 min charts we can expect to see a correction. I don’t usually like a double bottom or double top situations because for me that is very tricky. The SPY can make lower low and after a lower high on daily chart with strong intraday selling pace that won’t be unusual. They have enough room for that. The DIA has room for more selling on the daily charts and it is same for the QQQQ. On the other side, we can see a nice support area and a double bottom possibility and that won’t be an unusual situation if Indices bounce from here. You all know that I need consolidation for my style and right now the Indices are on the move (on the daily charts) and because all the reasons mentioned above, I don’t have a clear bias for the morning action. If I was betting I would lean toward continued selling pressure in the morning and a reversal in the afternoon. That is just guessing and will wait for the opening action. If indices start with correction after daily move down we must see what kind of correction that will be (base, triangle, flag). So we can say right now that every option is open and because of that risk will stay higher and we must be focused on intraday moves. During the summer, I expect more indecision with a weekly consolidation possibility.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
Last edited:
Market commentary for 06/27/2007

Good day!
I can copy all the text from yesterday's commentary with only a few additions. We saw a typical summer trading day. The morning was choppy, during midday we saw choppy range action and for the rest of day we saw selling pressure. The SPY was weakest and made a new daily low. On the chart we can see that it has room for another intraday move down to previous daily support area. The QQQQ closed at strong daily support area (50sma), while the DIA closed at low, but with very little change from day before and it too has room for another drop.

http://www.ivicacharts.com/diagrams/2007/0627007dia.jpg
http://www.ivicacharts.com/diagrams/2007/0627007spy.jpg
http://www.ivicacharts.com/diagrams/2007/0627007qqqq.jpg

On the 60 min charts we can see that 20sma still holding and now is key resistance for any possible future reversal. The fourth selling wave is on the way and we can expect continuation today in morning after the open.

http://www.ivicacharts.com/diagrams/2007/0627007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/0627007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/0627007qqqq60.jpg

We will watch the opening action since we can easily see a gap down and reversal. We can see a small gap up and then selling pressure. Risk remains high and the market is already on the move down and after four selling waves on the 60 min charts. New short setups right now will come in the high risk level. My focus will be on the reversal and during that time we will manage open short trades. I will look for strongest names for reversal possibility and for that I will use % lists. Risk from overtrading is high now, and please keep that in mind. We don’t need a ton of trades every day and right now it is smart to preserve capital for future challenges. The FED meeting starts with the decision on Thursday at 2:15 pm ET, keep that in mind.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]
 
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