US market commentary

[xpertstocktrader]

Market commentary for 08/15/2007

Good day!
A good trading day for us is when we get what we expect. If you look at yesterday's market commentary you will see that we got exactly the action which I expected. There are several reasons for that. One is the daily bull trap that we can see last week on August 09, 2007. Next is Monday's narrow range day which suggests the possibility for a trend day. When we look at those reasons you will see why my expectations were more on the down side. On the daily charts we can see the Indices are back to the previous daily low support area. From the open we got trend day and it is important to follow 10sma and 20sma on the 5 and 15 min to feel and see pace.

http://www.ivicacharts.com/diagrams/2007/08152007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08152007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08152007qqqq.jpg

If we look at 60 min charts we can see that the DIA has room for an equal move to the target area. The double bottom possibility brings caution and so we can not go blind with shorts. Same situation is with the SPY and the QQQQ. They are all on their support area but have room for more selling pressure.

http://www.ivicacharts.com/diagrams/2007/08152007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08152007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08152007qqqq60.jpg

That is exactly the scenario which I will follow today. My bias is still with shorts. I think the indices have additional room for daily equal move and the reason for that is the daily bull trap. You can see that I repeat several times the bull trap. That is because after that action and after daily consolidation a lot of time we will see a continuation and that is the direction which I will look. All that sounds great, but I will repeat that risk is higher and we must stay with very low risk in our trades. We had a nice trading day and MICC, MO, EXC and for patience traders DRIV did great yesterday. We didn’t get a big profit for them because I reduced my risk to the minimum. I will stay with the same risk for the rest of month. Intraday market is very whippy and can easily have us stopped out of every trade if we use small stops. I am using bigger stops with less shares to avoid that possibilities.

This morning we have the CPI reporting. That can be a market mover. If it is hot the market will probably sell off hard signaling the FED will do nothing. I tame number (less inflation) and we are off to the races saying the FED will cut in September.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/16/2007

Good day!
The market made a couple of low volume attempts to rally into resistance before the indices gave way to selling pressure that brought the DIA to the daily 200sma and equal move support area. On the daily charts we can also see the SPY and the QQQQ still have room for continued move down in the morning. One possibility is that we can see that area with a gap down since the indices closed at their lows. The selling pressure was within our expectations. Since the market closed at its low and was already on the move I used only day trades to take advantage.

http://www.ivicacharts.com/diagrams/2007/08162007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08162007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08162007qqqq.jpg

On the 60 min chart we can see that morning possibility but I won’t use it for new short trades. This is more for those who stayed over night with open positions. The DIA is already on the support and the daily CCI is in an oversold area. Right now every new short trade will be to high risk for me and my focus today won’t be on that side.

http://www.ivicacharts.com/diagrams/2007/08162007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08162007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08162007qqqq60.jpg

With that in mind I will look for a reversal today. That usually won’t come first thing in the morning so I will look for that possibility during lunch period or after 13:00 pm ET reversal period. When we have that strong pace usually we wont see “V” bottom. I will look for rounding bottoms on the 15 min charts or for reversal patterns. Moving averages give us help to determine pace. Yesterday, for selling pressure, the 5 min 10sma was very important and for reversal pay attention on 20sma on the 15 min charts for day trades and 20sma on the 5 min chart for scalp trades. Again, it is very important to follow pace, which is key for possible continuations. Reversal possibility I will use mostly for day trades, because right now swing trades are to risky and every over night position will bring added risk. Note that we have option expiration Friday and that we are still in August (worst trading month in the year)

If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/17/2007

Good day!
Is yesterday's low the bottom? After all the short covering and yesterday's close we might suspect that it is. Indices got a daily pivot bar with strong volume and the DIA and the SPY closed in positive area, which all suggests a bottom area. The day started as expected with gap down and then the selling pressure continued. I personally did not expect that much selling strength. Because of that, I avoided new short trades after SIMO, LBTYA and PMTC, which I had on the short list. I tried to stay with the strong names but every try to bounce finished with new low. Most of day was played out like that until last 30 min when we saw strong bounce and short covering. All said the daily equal move held and the DIA and the QQQQ closed above 200sma daily support area, which is always strong support.

http://www.ivicacharts.com/diagrams/2007/08172007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08172007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08172007qqqq.jpg

I was expecting the 15/30 min rounding lows for the bottom. Regardless of that on the 60 min charts, we can see that we got “V” bottom and that brought Indices to the highs. Maybe I’m wrong but usually after that strong selling pressure which we saw last weeks the selling pressure is not over with “V” pattern. Next days/weekly I will expect whippy market action from day to day and because of that possibility, I will stay with day trades. Swing trades are still in high risk zone and I will expect that will be case for some time.

http://www.ivicacharts.com/diagrams/2007/08172007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08172007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08172007qqqq60.jpg

Today is option expiration Friday and that will increase risk. This is a day for fast trades and hopefully for fast profits. To avoid intraday whippy action and possible stops by whip saw action we have to options. One is to have larger stops and trading with smaller lots and be fast with profit. Don’t expect usual gain and be fast with exits. Second, which I will use is to use patience and wait better days for trading. Friday in the summer and option expiration day are enough reasons to stay with patience and maybe going to the beach as my best friend today. Every over night trade is high risk and I would stay with day/scalp trades for some time at least until the market calms down and brings us possible direction after consolidation. Focus is again on strongest and weakest names for intraday moves.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/20/2007

Good day!
Including the last 30 minutes on Thursday and Friday's gap in the morning, we saw a huge bounce from weekly/daily support areas. Friday started with big gap up, but unfortunately that was all we saw on the long side. On the daily chart 200sma resistance area was to strong for the SPY. On the other side the DIA found strong resistance on daily 10/100sma. Market was weak after the open and we saw that opening gap filled very fast. Thursday's close was strong enough and Indices bounced form there. Unfortunately the bounce was very choppy and slow and the risk was to high for more than scalp trades. Friday's action was as we expected. High risk and not worth it for serious trading. It was good only for scalp traders. It is very important that traders recognize when there is good market action for trading and when it is good for waiting.
Let’s take a look on weekly charts to see what we can expect next week.
We can see a big extended bar with huge volume which indicates extreme action on smaller time frames charts. Finally the Indices found support after selling pressure all week. Volume was big last week and that suggests the market finally found a bottom for now. Closer inspection of the volume on Fridays actually was quite light after options expiration and opening short covering. That does not mean that we will see an uptrend again. The 50sma was strong support area and usually will hold first try for breakdown. Right now the big weekly resistance will be 10and 20sma

http://www.ivicacharts.com/diagrams/2007/08202007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/08202007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/08202007qqqqweekly.jpg

On the daily charts we can see that previous support areas now become resistance and that stalled Friday gap action. For the DIA that is 10/20/100sma area, for the SPY 200/20sma and for the QQQQ that is 100sma.

http://www.ivicacharts.com/diagrams/2007/08202007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08202007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08202007qqqq.jpg

On the 60 min chart we can see clearer resistance and support areas. With Friday gap “V” bottom still holding and 20sma resistance now become to first support area. Look at 60 min volume which mentioned earlier is declining and that is not what we like to see. Because of that I will expect that we will see correction from bounce and more selling pressure.

http://www.ivicacharts.com/diagrams/2007/08202007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08202007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08202007qqqq60.jpg

I do expect the indices will hold last week lows for some time, which does not mean that they won’t try to retest the lows. After the strong move last weeks and the big and extended bars everywhere the market needs rest. If we look again on the weekly chart its been a long time since we have seen that extended action and things must calm down before we can see low risk setups again . Huge moves generally need time for a huge rest. I expect that next weeks market will be all around between weekly support and resistance areas. Right now the market is very nervous with all economic news and with extreme move and that will reflect on risk. I’m sure that we will find trading opportunities, but staying in trades over night will be higher risk. Especially for several days/weeks and that limits our swing possibilities. Maybe some of you are frustrated because you are thinking you missed the huge moves. Look on this way, extreme move = extreme profit= extreme risk. I have been at this long enough to know that only way to be long term and successful is to stay with reasonable risk.
Right now it is very important to compare stock charts with market charts to determine strongest and weakest names. I will use them for intra day moves and possible trades. It will be very hard to find “own way” stock, but if I will find it, that will be good candidate for swing.

Good luck trading today!!!!
Ivica Juracic

 

[xpertstocktrader]

Market commentary for 08/21/2007

Good day!
We didn't see much of anything yesterday other than indecision and some consolidation. If we look in the past we can see that yesterday's bar is a narrow bar and comparing it with the bars of the last few days it suggests some consolidation on the intra day charts. On the daily charts we can see that the volume declined and the indices stalled at the resistance area. That suggests we can see a reversal, however on the 60 min charts we can see nice 3rd try triangles which can suggest continuations.

http://www.ivicacharts.com/diagrams/2007/08212007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08212007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08212007qqqq.jpg

I think the indices are on a very important resistance area. Usually 3rd try can be the very charm, and can bring Indices to new highs. But since Indices are at daily the resistance area with a decline volume and if the 3rd try won’t go we can see strong intraday reversal (red arrow).

http://www.ivicacharts.com/diagrams/2007/08202007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08202007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08202007qqqq60.jpg

Taking all that into consideration it will be very important to see the action at the open today. Swing trades are still extremely high risk and over night trades are higher risk than usual. If we see a reversal in the morning, pay attention to the 20sma 60 min support area. If that doesn't hold the DAI and the QQQQ could easily go back to the daily 200sma support area. My focus will stay with intra day action for day trades. Yesterday we had several breakeven trades which is proof that we had scalp market (consolidation). Until we see a definitive market direction I think that we will stay in the same mode. I will watch for strongest and weakest names in both directions. Risk is still higher and we must respect that. We need to be patient and wait for opportunities the market allows. I believe we will have same consolidation and chop action for rest of the week.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/22/2007

Good day!
From a risk perspective, Tuesday's action was waste of time. The QQQQ showed strength on low volume, but the DIA and the SPY didn’t follow that action at all. That didn't surprise me looking at the daily charts the QQQQ had room to meet the resistance area (10/100sma). On the other side, the DAI and the SPY formed NR7 bar (narrowest bar in last 7 days). That suggests a possibility for a trend day and that is what I will be looking for Wednesday. When we have strong move down like last week the weakness determination is the 10sma resistance area. If down trend is really weak we will see a bounce from 10sma and that is the situation we have on the daily charts. The QQQQ also have 100sma, the DIA 20/100sma and the SPY 20/200sma resistance areas very close. Because of that, Tuesday was slow for me. I couldn’t bring myself to be in a bullish mode with that strong resistance overhead and all day I was looking for a daily reversal.

http://www.ivicacharts.com/diagrams/2007/08222007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08222007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08222007qqqq.jpg

If we look at 60 min charts we can see the DIA try to break up on the 3rd try (what is often charm), but didn’t work and day closed with 3rd try to break down. With daily resistances that will be direction, I will look for on Wednesday. It is same with the SPY 60 min chart. Key support area now is 20sma and if we will see selling pressure with good pace, I think that we can expect down trend for Wednesday. In that case, daily 200sma will be good support area for the DIA and the QQQQ, while the SPY can look for previous support area on the daily chart.

http://www.ivicacharts.com/diagrams/2007/08222007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08222007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08222007qqqq60.jpg

Of course that is one scenario that I will expect will play out. We must be open for anything so we must follow the market action. In the case we see strength, the daily resistance over head is quite strong and I will go with very small risk on long trades. When we expect trend day possibility it is important to mark high and low after 60 min and the direction that is broken first is the direction we can expect. We must pay attention to the pace and consolidations on smaller time frames. That action can help us to determine future action and risk. We must also pay attention to volume. We want see proof and volume helps us with that. If we have breakout in any direction and it is with larger volume than usual, with a strong pace, that is the direction we want to follow. If pace is very weak, then risk will increase and we want use proper risk management in that situation.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/23/2007

Good day!
What I expected yesterday did not happen. The market opened with a gap up and kept on going. The QQQQ started the day under daily 20sma, the SPY above 20/200sma and the DIA above daily10sma. All the Indices have room for a move up and I hope they will do that. Unfortunately, we saw another very slow range trading day. Indices closed again under resistance which can be seen on the daily charts. Low volume on this bounce from the daily lows is something we must worry about with long positions. Since the Indices didn’t bounce from the daily 10sma which will determine the strong daily trend I think we are coming in a zone where we can expect daily whippy range action in the near future. The daily moving averages now become support areas.

http://www.ivicacharts.com/diagrams/2007/08232007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08232007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08232007qqqq.jpg

The DIA is forming a pennant on the 60 min charts. Compare the buying pace from the daily low and buying pace which we have now. Obviously, it is weaker than the buying pace from the daily low. . On the SPY chart, we can see the same situation. A buying channel is what we have right now and it is weaker than the bounce pace. The daily volume declining is not helping. I didn’t expect the QQQQ be the strongest index and the 60 min chart 3rd try triangle would work that nice. On all three charts we can see that Indices have more room for Thursday possible move up, or gap up. The indices closed strong and a gap up is possible in the morning.

http://www.ivicacharts.com/diagrams/2007/08232007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08232007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08232007qqqq60.jpg

I still don’t trust to move up with lower volume and a weak buying pace, but that is the action which we have. Since the SPY and the QQQQ closed above 20/200sma and the DIA above 10sma my short bias is now gone. I think we will see a move down, but that will be more for intra day purposes. Reason for that is there is too big a bounce from the daily low and closing above previous resistance areas which now becomes the support areas. Of course we will still follow the market action and then we will decide what to do, but from this view I will expect high risk whippy daily action without a trend. This week is a good example of why August is a very difficult month for trading and why the risk is very high. The only way to protect ourselves is to use our old friend, PATIENCE. Be smart and save trading capital for better days. In the mean time I will cut number of trades and trading risk.

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

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/24/2007

Good day!
Another day of a meandering market with little direction. Asia, Europe and BAC funneling life into CFC could only muster a small gap at the open which was quickly filled. The rest of the day should have been spent at the beach because it was a day not worth trading. Wednesday's low support area and daily resistance areas held perfectly. If you remember as written in Wednesday's commentary I commented that I wasn't happy with the markets action since it broke above the important daily resistance. Those resistance areas become support areas and held the market from a stronger correction.

http://www.ivicacharts.com/diagrams/2007/08242007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08242007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08242007qqqq.jpg

On the 60 min charts we can see how important is the 20sma area. It is important on every time frame and we can see that every try to break under it has failed. In addition the daily support areas (the DIA 20sma, the SPY 20/200sma and the QQQQ 20sma) are also showing strong support. On the resistance side of the daily charts is also holding and the indices are stuck between those areas. The 60 min charts perhaps are forming a head and shoulder possibility which can bring some action today. I will look for that scenario but this being Friday in August I am now getting very excited.

http://www.ivicacharts.com/diagrams/2007/08242007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08242007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08242007qqqq60.jpg

Right now I am not interested in trades on the long side. We might find an “own way” stock with charts like HEW yesterday. We took several short trades (AFFX, TEN, BEAV) and I hope they will improve today if head and shoulder will work. Important is to know that I took every trade with small risk and because market action is whippy it can break in any direction. We must save our trading capital for better days. Note that today is Friday, we are still in August (summer), and we can expect slow trading day after the morning action.

Please note that after reviewing the trades that we have put on within the first 10 or 15 minutes of the market opening all have set up correctly and all have quickly reversed and stopped us out. They have also reversed later in the morning and ended the day moving as expected and we have a stop loss. I will not increase risk by not using our stop. I decided I will not take a new trade in the first 10 or 15 minutes the market is open until the market returns to some normalcy.
If you have any questions, please email me or ask me in the trading room.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/29/2007

Good day!
Monday's selling pressure into the close continued with a gap down on Tuesday morning. The market was weak all day and brought a nice trend day with a midday consolidation at the low. This is exactly what I was looking for. Move-rest-move. On the 15 min charts, we can see the midday rest and the move before and after that. The selling pressure was strong and closed at the lows with a stronger selling pace and increased volume.
If we look at the daily charts, we can see that all the Indices closed under their 10sma support area. This is important because all these moving averages once again become resistance areas (10/20/50sma). The Indices closed Tuesday right at their previous support areas, before the strong move down (August 14, 2007). This is a strong support area and despite the possibility of a gap down, I don’t expect (for now) that the Indices will easily see the lows of last week. One possible scenario is a daily higher low and a reversal head and shoulders pattern. Because of that and the strong support area, I will look for a reversal Wednesday afternoon.

http://www.ivicacharts.com/diagrams/2007/08292007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08292007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08292007qqqq.jpg

Lets look back a little at Tuesday's action. On the 60 min charts, we can see that the selling pressure was strong. It was stronger then Friday's buying pace and because of that, I will look for a possible gap down today (Wednesday). The Indices have room for that possibility.

http://www.ivicacharts.com/diagrams/2007/08292007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08292007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08292007qqqq60.jpg

On the 15 min charts, we can see textbook trend day action. Gap down, selling pressure, midday consolidation and continuation after 14:00 pm ET reversal time. In addition we had a stronger and stronger selling pace until the end of the day. The volume added conviction to the direction and that is a textbook example of a trend day. On the 15 min charts, we can see that the Indices have room for a move down until the equal move support area. With the very weak close and the strong pace that is a possibility. But, still just a possibility, because we can’t be sure of future action.

http://www.ivicacharts.com/diagrams/2007/08292007dia15.jpg
http://www.ivicacharts.com/diagrams/2007/08292007spy15.jpg
http://www.ivicacharts.com/diagrams/2007/08292007qqqq15.jpg

With the reasons that I explained above (possible daily reversal H&S pattern), I will look for a reversal after the possible morning weakness. But if we see a weak correction then we could easily see more selling pressure. All depends on pace and volume. Right now, with the weak close, new short trades will be higher risk without intraday consolidations (look at 15 min charts). The key action will be on the intraday correction. A consolidation with weak pace and volume could bring a selling continuation and a 3rd selling wave (15 min chart), however, a reversal with strong pace and volume could bring a reversal daily C&H pattern.

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

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/30/2007

Good day!
One day down, next day up. That is a short description of this week's action. Unfortunately, we expected the market to have this kind of whippy action because of the strong weekly moves, and this is something that we could see over the next few weeks. The weekly charts need rest and consolidation and after a big wave, small waves will follow. I did expect a reversal possibility, but I didn’t expect it this way. The QQQQ was the strongest and closed Tuesday morning's gap down, while the SPY and the DIA finished around Tuesday's open area. The indices are again above their moving averages (10/20/200sma) and I think that these lines on the daily charts bring strong support/resistance areas as usual. For a better understanding about what is going on, we must see the weekly charts, and right now the important area is the 10sma.

http://www.ivicacharts.com/diagrams/2007/08302007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08302007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08302007qqqq.jpg

On the 60 min charts, we can see how whippy the action is. A strong move up, a stronger move down and again a very strong move up. No continuation, for now just whippy action between Monday's high and Thursday's low. We can easily see a continuation of this big range action.

http://www.ivicacharts.com/diagrams/2007/08292007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08292007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08292007qqqq60.jpg


The 15 min charts formed a nice reversal head and shoulders pattern. If we look at the right side of the pattern, it’s look like a mirror reflection of Tuesday. Day traders had nice market action on Tuesday and Wednesday, but since my style is based on the “whole picture” and a bigger time frame support, I was not that active on Wednesday. It is always easier to see in hindsight, but without the daily charts support, I couldn’t be a strong buyer. This does not make me sad. I have my criteria, and I will wait for the market to get back to normal and then I will be more aggressive.

http://www.ivicacharts.com/diagrams/2007/08302007dia15.jpg
http://www.ivicacharts.com/diagrams/2007/08302007spy15.jpg
http://www.ivicacharts.com/diagrams/2007/08302007qqqq15.jpg

On the daily charts we can see that we have a reversal H&S possibility, but I won’t be surprised if we will continue to see more daily whippy action (weekly consolidation) before the true direction. Until this resolves, I will be less active. I will continue to use a small risk and I will wait until I can trust the market action. Right now I don’t have a strong bias, and with the whippy possibility we can see a lot of overlap in the market action . That is the worst market action for my style, because charts go from high to low without any continuation, and for me that means trading without low risk and good r/r possibilities. The indices closed strong and at highs. Again I will wait at least 5-15 min to see market breath, before I will take any new trades.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 08/31/2007

Good day!
Thursday brought a continuation of the whippy action we have been seeing. The indices started the day with a bigger gap down on the SPY and the DIA (under 20sma 60 min) than on the QQQQ. The QQQQ was the strongest with the 200sma 60 min holding nicely with the gap down at the open. After the gap down, we saw a strong move up. The QQQQ first filled its' gap and broke above its' 50sma daily resistance area. The DIA was the weakest and Wednesday's high continued to act as resistance for now. Overall, we saw very whippy market action with strong moves in both directions.

http://www.ivicacharts.com/diagrams/2007/08312007dia.jpg
http://www.ivicacharts.com/diagrams/2007/08312007spy.jpg
http://www.ivicacharts.com/diagrams/2007/08312007qqqq.jpg

Right now the SPY and the DIA have a similar situation on the 60 min chart. The action is staying between the 200sma (red) resistance area and the 20sma (blues) support area. We can see a number of big bars which suggests very whippy action and that is not good market action for my style. I need “whole picture” support and right now we can’t see that. On the daily charts, the Indices are consolidating without a clear trend and on the intraday charts we don’t see continuations, mostly strong moves up from support and strong reversals from resistance, without consolidation between.

http://www.ivicacharts.com/diagrams/2007/08312007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/08312007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/08312007qqqq60.jpg

Unfortunately I don’t expect a big change for Friday. We are still in summer days and the market is closed on Monday (Labor Day). The first 90 minutes of the morning will probably have the best action. For the rest of day, I expect that volume will drop off because most traders will leave early for the long holiday weekend. For now, my best friend is patience and my trading activity is very small. This is a scalp market and good scalpers are having a really great time. This is not my kind of market so I will wait for now until the charts look good for truly healthy moves. I’m not impressed with the volume of the Indices with this move up and to me that looks like a good opportunity for the big guys to cut losses from the strong move down. Maybe I’m wrong, but I’m sure that this is a hard time for swing traders and I’m one of them. My activity is smaller, but that not mean we don’t have any opportunities at all. We just don’t have the same number of them as usual. AFFX is a great example of an "own way" trade. For Friday, I don’t have any bias and I will just follow the market action. If the market will continue to show us this whippy action again, I won’t be an active trader.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/03/2007

Good day!
Friday brought classic pre holiday market action. The day started with a strong gap up. After the morning weakness, the indices broke to new highs and to their daily resistance areas. For the QQQQ, that was the previous high resistance area. The DIA and the SPY found resistance at their daily 50sma area. Volume was light which is what was expected for pre holiday trading. The last 30 minutes brought profit taking and strong selling pressure with the Indices closing near their open area. This ended up forming doji bars. A doji bar means indecision. The direction will be determined by the way it is broken first. (Friday's low or high). August is over (finally), and that is always a good time to look at the monthly charts.

On the monthly charts, we can see we have had big bars for the last two months, with August having the biggest bar in a long while. When we have these kind of strong, unusual moves, like these last two months, trading risk is high. We need the market to calm down. This however can take several months and that is not good news for swing traders. The DIA formed a doji bar with huge volume. We have the same situation with the SPY, while the QQQQ closed strongly at the high of the bar.

http://www.ivicacharts.com/diagrams/2007/09032007diamonthly.jpg
http://www.ivicacharts.com/diagrams/2007/09032007spymonthly.jpg
http://www.ivicacharts.com/diagrams/2007/09032007qqqqmonthly.jpg

On the weekly charts, the situation is clearer. The weekly DIA 10 and 20sma want to crossover and the DIA closed right under that resistance area. The SPY is weaker and we already have a 10/20sma crossover. When we have extreme moves, the 10sma is always the first big resistance area, and the SPY found resistance under it. The monthly chart shows the QQQQ as the strongest, and closing above all weekly moving averages at its' previous high resistance area. We can see, on all the charts, that the reversal volume is much lighter, which is not a good sign for recovery (for now).

http://www.ivicacharts.com/diagrams/2007/09032007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09032007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09032007qqqq.jpg

The daily charts again gave us doji bars on Friday. So we have the DIA and the SPY with monthly doji bars and all the Indices have daily doji bars. Lots of indecision for future action.

http://www.ivicacharts.com/diagrams/2007/09032007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09032007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09032007qqqq.jpg

The 60 min charts show the QQQQ strength and the SPY, DIA weakness. We can see that with the last big red bar. On Friday, we can see that the buying pace on the QQQQ chart is getting slower with lighter volume (what is usual for pre holiday days)

http://www.ivicacharts.com/diagrams/2007/09032007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09032007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09032007qqqq60.jpg

Now what? What direction we can expect? After all these doji bars, for me, it is hard to predict. I am leaning more toward the short side for Tuesday. There are several reasons for that. Light volume, strong resistance and doji bars. The indices have strong resistance on all time frames (monthly, weekly, daily). But indecision means that we can break in either direction, and because of that it is hard to know for sure what to expect for future action. One thing is for sure, whatever direction we will see, it must be with higher volume and that will be proof of the direction. Because of that, I will wait on Tuesday until the market proves it’s direction. Maybe I will miss the main move, but I will take the continuation. This way I will try to cut my risk. Risk remains quite high right now especially for swing traders. Again, from all time frames with these doji bars we just don’t have a clear situation. We don’t have consolidation, and that is what we need for low risk setups. As traders, finding low risk setups is our main occupation and we must always keep that in mind. Patience is key in a high-risk environment. The market is ever changing between low and high risk. We will always have opportunities. We just need to have patience and protect our trading capital for low risk setups.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/05/2007

Good day!
A doji bar can mean a reversal, but it can also mean a continuation. That is exactly what we saw on Tuesday. The market gave us a nice trend day and all looked nice, but on the larger time frames I don’t see major changes and therefore believe that we must be very cautious.
The day started with a flat open and the buying pressure started right away. It was a textbook trend day, with a move in the morning, rest during midday and continuation after 14:00pm ET reversal time. For a full trend day we needed to see buying pressure into the close. Tuesday's close saw a reversal (profit taking) with stronger intraday volume. The indices are stronger then expected, and for now the only thing we can do is to go day by day. Overnight trades continue to be higher risk. The reason for that is again volume. We had a strong day up, with lighter volume then I like to see. The DIA closed under its' 50sma and the SPY under its' 100sma daily resistance area, while the QQQQ found resistance at a strong number area, $50 area. All this looks nice, and if this area will be broken with strong volume then the indices could get back to their yearly high. Right now we still have indecision.

http://www.ivicacharts.com/diagrams/2007/09052007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09052007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09052007qqqq.jpg

On the 60 min charts, we can see that the Indices already had 3 buying waves (usually after 3rd we could see correction), and the same is true for the other indices. Volume was relatively light for the strong action we had and that is my biggest worry right now. Are the big boys pumping this up just to cover losses or not. For now I still think yes, but I don’t want to be biased. I just want to read the charts and right now they are telling us about a move up with declining volume.

http://www.ivicacharts.com/diagrams/2007/09052007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09052007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09052007qqqq60.jpg

For me, that means a high risk market, every o/n trade is risky and I will go day by day and just follow the market action. As we did yesterday with GOOG, MFE and TTEC, I compare market action with individual names and I look for weakest and strongest names. I don’t have a bias for Wednesday and I will again wait for the first 5-10 min to see the market breath before I will take any new trades. It is time to be careful and patient. Because of that I’m cautious with longs as well as shorts for now.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/06/2007

Good day!
Right now the daily charts have a lot of support and resistance. The Indices opened on Wednesday's session with a gap down. For the DIA that meant under its' 100sma area. The DIA found support at its' 10sma and its' 20sma is close as well. On the other side, the 100sma is now a resistance area along with the 50sma. The same daily mess of moving averages is apparent on the SPY chart. The first support area is its' 10sma and the 200/20sma are close by as well. On the other side the 50sma is the 1st resistance and 100sma is close after. The most clear situation right now is with the QQQQ daily chart. It is above all moving averages and Thursday's low is the first support resistance area, and after that is its' 10sma. Wednesday was a negative day with strong selling pressure in the morning and the daily volume is interesting as well. Take a look at the SPY and the DIA volume. Wednesday was higher then Tuesday's up volume, and on Tuesday we had a nice up trend day. Volume can tell us a lot. If you remember in the last sessions, I wrote about light volume on the last daily move up and Wednesday was a down day with larger volume. This is the reason why I’m suspicious with the long side right now. I follow the market, but it is still hard to use up days for more then just day trades.

http://www.ivicacharts.com/diagrams/2007/09062007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09062007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09062007qqqq.jpg

Also, take a look at the 60 min charts. The SPY and the DIA corrected Tuesday’s entire trend day move up right into the morning. If one is looking for action to bring the market back to its yearly highs, this is not the kind of action you would want to see. During the last few days the DIA was weakest, and the SPY was not far away, so the QQQQ will have hard job to bring them above all their moving averages (daily charts).

http://www.ivicacharts.com/diagrams/2007/09062007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09062007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09062007qqqq60.jpg

I still think that we are in a weak market, but with lots of resistance close above and lots of supports close under, I know that swing traders will have a hard time. Yesterday we had several nice swing setups as well as several nice day trades. It remains very important to use a small risk for every overnight trade. With all of the resistance and support areas, we can see jumpy market action in the future which is in the line with the weekly and monthly charts. I will continue to go day by day without longer expectations. For swing trades I will follow the weakest and strongest names. There is no other way to trade this market action.
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/12/2007

Good day!
Tuesday gave us a trend day. It was not a trend day with strong volume and clear intraday action, but it was still a trend day. Thursday started with a gap up, above the 200sma 15 min and that was a very important support area. We knew that if the 200sma 15 min held the first reversal period, new highs would bring a bullish bias to the markets. The rest of the day we saw choppy trend action with lighter volume. This is the part that makes me comfortable with the long side for more then just scalps and day trades. If we look at the daily charts, every down day has stronger volume then the up days do.

http://www.ivicacharts.com/diagrams/2007/09122007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09122007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09122007qqqq.jpg

Also on the daily charts, we can see that the Indices continued with their large range action and the SPY and the DIA closed right in the middle their ranges. The QQQQ is stronger and it will be interesting to see if it can pull the SPY and the DIA higher. This will be the 3rd daily buying wave, which we can see on the daily chart. On the other side , if the DIA and the SPY (weaker Indices lately) will lead with weakness, then we could setup a daily H&S pattern.

http://www.ivicacharts.com/diagrams/2007/09122007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09122007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09122007qqqq60.jpg

Right now it is very hard to predict direction, because the up days have been having lighter volume. This is not a signal for the swing long side, however, volume can come in with the QQQQ try for the 3rd daily wave and attempt towards its' yearly highs. On the other side, the SPY and DIA H&S could pull the market down. In the mean time, when we try to predict the direction and the possibility, we can see with the Indices trading in a big range. This brings us a difficult trading market. I can show the possible directions on charts just so we can see what to possibly expect. One thing is sure and that this is a high risk market. Swing traders are continuing to have a hard time and patience is our best friend. You all know that I need to see the “whole picture” for my trading plan. Right now I don’t see much of that. I will always find several interesting and good intraday trades, but for healthy, larger timeframe moves, we must wait.


Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/13/2007

Good day!
The net % column shows us again what kind of day the market had. After the small morning gap down, (above 200sma 15 min support) the Indices filled their gaps and went on to new highs. On the 60 min charts, we can see that the previous highs held on Wednesday and after that we saw consolidation for the rest of the day. Wednesday's low held and the Indices closed almost at the same point as Tuesday's close (without changes). A daily head and shoulders pattern is still possible and I will keep that in mind as one of the possibilities we could see. Volume decreased and the Indices formed a pivot bar after Wednesday's session.

http://www.ivicacharts.com/diagrams/2007/09132007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09132007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09132007qqqq.jpg

On the 60 min charts, we can see that the previous high was too strong for Wednesday. The first support areas are the 20sma (very important support area) and the previous high, which is now the support area (red line). If we look back again at the daily charts, we can see that all moving averages are very close. The SPY and the DIA have their 20/100sma as resistances and 10/20/200 as support areas. The QQQQ situation is more clear, because it is above all its' moving averages and they are all support areas now.

http://www.ivicacharts.com/diagrams/2007/09132007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09132007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09132007qqqq60.jpg

The expectations for Thursday are the same, and they are not positive. I will look for a reversal possibility, based on the possible daily head and shoulders pattern. Light volume could support that scenario, but I will be very cautious because of the close support areas. The next scenario is that the QQQQ will pull all the indices to new highs and will try to continue on to yearly highs. The last scenario is a daily range-type action without much change on the daily charts and choppy intraday action.

Right now all three scenarios are very possible, but if I must bet, the 3rd scenario is the one I would go with. Choppy action without clear direction and with intraday choppy trends on the smaller time frames, and a weak trend pace. Pretty much the same action that we saw on Wednesday. I think that we won’t see significant daily moves before the FED meeting next week, but in any case I will follow the market action and I will be prepared for every scenario. Whatever will be, one thing is for sure, and that is high risk. It is time to be patient and wait for better market action. I know some people are frustrated, but this is normal market action and we often see this kind of cycles. Remember no position is a position.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/14/2007

Good day!
Another up day with light volume. The day started with a strong gap for the DIA and the SPY, above Wednesday's high. This time the QQQQ was the weakest and the gap size was a lot smaller. As usual with a gap of that size, we see it filled at the open. That is exactly the action we saw on Thursday's open for the QQQQ. Since the SPY and the DIA were much stronger, that gave us a strong divergence at the open, which increased the trading risk. After the QQQQ filled its' gap, the DIA and the SPY took control of the market and gave us a morning trend move to new highs. Unfortunately, the QQQQ didn't share in that enthusiasm and Thursday's high held as the resistance for the day. During the midday, the Indices started a correction and stayed in it for the rest of the day. If we look at the daily charts, we can see that volume still decreased, which is not what we see in a healthy move up. With true buying interest, volume will increase, so, because of that, the possibility for a head and shoulder pattern is still in line.

http://www.ivicacharts.com/diagrams/2007/09142007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09142007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09142007qqqq.jpg

The SPY and the DIA stalled right at their previous highs, which brought a double top possibility. We can see that the 100sma with the previous high is the next resistance level for the SPY, and same for the DIA. On the 60 min charts, we can see that the SPY and the DIA already had three buying waves, while the QQQQ is forming a triangle pattern. Again the 20sma is a very important support area and if the QQQQ will break it, we could see stronger selling pressure.

http://www.ivicacharts.com/diagrams/2007/09142007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09142007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09142007qqqq60.jpg

From a technical view, we have a daily H&S possibility, with a double top (SPY and DIA) and decreasing volume. On the 60 min charts, we can see three buying waves (SPY and DIA). All this suggests a reversal possibility. Unfortunately, the daily moving averages are all very close, so because of that we don’t have a clear situation for a move down. On the other side, if the indices want to break up, for low risk setups, we need to see volume with the buying interest. Without that, risk will remain high, as it has been for the last few days. Since most are waiting for the FED next week, another real option is the choppy action we have been seeing without daily direction. This scenario is the one I am leaning towards. I think that this type of action will remain until Tuesday's FED meeting. But we never know what tomorrow will bring. Will it be a H&S reversal, or a break to new highs?? Please remember without volume confirmation, any break to new highs will continue to have high risk and the market will stay in scalp mode as the safest way to make a profit. Without direction and volume, swing traders still must stay in patience mode. Once again, remember cash is a position too. Please keep that in mind. It is time to wait, trade small (not overtrade) and use small risk. Lots of traders can fall into the overtrading trap, so don’t be one of them.

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

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/17/2007

Good day!
Well there is one less day before the FED meeting. Everyone is waiting for the FED decision and we can see that on the charts. I have just a few words for Friday's action. The day started with a strong gap down, under Thursday's low, and usually that size of a gap and kind of a trap at the open will bring selling pressure and very possibly a trend day. That didn't happen on Friday and I think that the main reason for that is that everyone is waiting for the FED. After the strong gap down, the Indices started with buying programs and with a strong pace, and the volume filled the gap very quickly. We stalled around Thursday's closing area and that was it for Friday. The rest of the day we saw a range with worthless action for low risk trading, unless you are a scalp trader. Volume was light during the range action and the Indices closed without any change compared to Thursday’s close.
On the weekly chart we can see green bars, but the Indices still closed in the consolidation area, under their previous week’s high. The SPY and the DIA are still under their 20sma resistance, while the QQQQ closed under its' previous week high, which is still in line with lower high possibilities.

http://www.ivicacharts.com/diagrams/2007/09172007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/09172007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/09172007qqqqweekly.jpg

The green weekly bars closing under their resistance areas suggest mixed expectations. The indices can break up and head back to their weekly high, or they can go down, consolidate and then start a downward trend. On the daily charts, we can see those possibilities clearly. Over the last few days I have suggested a H&S possibility and that remains on the SPY daily chart.

http://www.ivicacharts.com/diagrams/2007/09172007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09172007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09172007qqqq.jpg

On the DIA daily chart, I can draw another possibility and that is a consolidation near the high on Monday and Tuesday (before the FED decision) and then a break up, which will lead to a complete market reversal to previous weekly highs. Right now we have both options as possibilities. The SPY H&S reversal pattern can work and bring us down, but also the DIA consolidation can bring us up to a possible weekly double top pattern. On all the charts I can see both possibilities, but I just chose the DIA and SPY so that everyone has a clear chart to recognize this. We can see the range action on the 60 min charts over the last three days, so breaking in any direction from this range action could bring us pace and volume (hope so). If not, we are in trouble and that means the 3rd scenario (choppy daily action) will continue and along with that the high risk market, and waiting and waiting and waiting some more. I still believe that we will see a market move in one direction after the Fed on Tuesday.

http://www.ivicacharts.com/diagrams/2007/09142007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09142007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09142007qqqq60.jpg

As I said above, we can see either direction and the percentages are high for both of them, but if I must bet I will bet on the short side due to the volume on the down days (higher then the volume on the up days) Let’s say 60/40 for the down direction. For the longer term, I still think that the market will have a hard time breaking out to new yearly highs. That does not means that before any move down the market can’t break up (after FED) and form a double top weekly pattern and then start the move down. I just want to say that we must be prepared for any direction. After the FED decision we can see a strong reaction and there could be lots of traps and my suggestion is to wait. In that situation I wait and watch the first move (main move). After that I just watch for consolidation, and if there is continuation (base, triangle flag) then that is a pattern for me and I will go and I will join. If the consolidation is whippy, then I won’t be trapped with any direction and I will again wait for another opportunity. It is always very risky to try to pick a bottom or top and you can stop out very quickly trying to do that. Let’s wait and see. If the train will go up or down, we can join at the first station.
If you have any questions, please email me or ask me in the trading room
Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/18/2007

Good day!
Monday brought another consolidation day with low volume. The day started with a gap down with the QQQQ being the weakest of the indices. It broke under Friday's low but that didn’t bring any continuation. In fact, the QQQQ got back into a 60 min range and stayed in it for the rest of the day. The SPY and the DIA's intraday and daily charts had similar action. Everyone is waiting for tomorrow's FED decision and that exasperated Monday's indecisive trading action. The daily charts stayed the same as discussed in the weekend column. On the DIA and the SPY daily charts I left the potential patterns we can expect to see, just for our imagination.

http://www.ivicacharts.com/diagrams/2007/09172007diaweekly.jpg
http://www.ivicacharts.com/diagrams/2007/09172007spyweekly.jpg
http://www.ivicacharts.com/diagrams/2007/09172007qqqqweekly.jpg

On the 60 min charts, we can see that the Indices stayed in a range and that kind of action will usually bring a high risk market. Scalp trades were the name of the game. The only change from Friday is that the Indices closed under their 20sma, which are now their resistance areas. I think that the Indices will stay in that 60 min range before the FED meeting.

http://www.ivicacharts.com/diagrams/2007/09172007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09172007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09172007qqqq.jpg

Since everyone is waiting for the FED decision, we could see a strong reaction after the 2:15 pm ET decision. It is quite possibly that the intraday range will not serve as either support or resistance. The action after the FED decision is always volatile. Usually, we see very strong moves with high volume and for me that is a very high risk time. It is not unusual to see 3 moves. The initial reaction goes in one direction, and then we see a 2nd wave in the opposite direction and a third and final wave in the original direction. Of course, this is a short, general explanation, because we can’t know what the market will do. The volume after a FED decision is usually very high and that can freeze chart platforms, so please keep that in mind. Lately I have noticed that we have gotten our direction on the 3rd move after the decision. The true direction might not occur until the following day. I want to say, that trading after the FED decision is very high risk and I tend to avoid that. I know that can sound frustrating, because most of us are already frustrated with the market action of late. But if we have enough patience to wait another couple of days for more healthy market action it certainly won't kill us and it can keep us from taking false breakouts. We can always take continuation patterns after the consolidations. If the train starts, and if it all looks good, we can hop on at the 1st station ,which is much better then getting on a train going the wrong direction.

Good luck trading today!!!!
Ivica Juracic
[email protected]

 

[xpertstocktrader]

Market commentary for 09/19/2007

Good day!
The market loved the FED interest rate cut. After the FED's larger then expected half point cut in interest rates, the market bounced strongly to new highs. Everyone waited for the FED announcement and we finally got it on Tuesday afternoon. The day started with a gap up to the upper range line on the 60 min charts. As we expected, the market stayed in a range until the announcement. Interestingly, we didn’t see any reversal after the strong bounce. The Indices continued with their upward direction without any correction. On the daily charts we can see that the indices closed near their previous resistance areas. The DIA and the SPY have a small amount of room until their resistance, while the QQQQ closed right at its previous high and gave us a double top pattern possibility.

http://www.ivicacharts.com/diagrams/2007/09192007dia.jpg
http://www.ivicacharts.com/diagrams/2007/09192007spy.jpg
http://www.ivicacharts.com/diagrams/2007/09192007qqqq.jpg

On the 60 min charts, we can see that the QQQQ and the SPY are near equal move resistance areas and we can clearly see that there is not a lot of room for the SPY and the DIA to touch it. The breakout volume was high, however that is expected after a rate cut.

http://www.ivicacharts.com/diagrams/2007/09192007dia60.jpg
http://www.ivicacharts.com/diagrams/2007/09192007spy60.jpg
http://www.ivicacharts.com/diagrams/2007/09192007qqqq60.jpg

Now what? The charts are telling us that we could see a reversal to previous yearly highs because the breakout pace and volume are strong. Is that logical from an economic aspect, well that is a different story. We can follow the market action and the market suggests a long bias. The QQQQ is already close to its' previous high resistance area (50.50 areas), while the SPY and the DIA still have some room to reach it. That will be very strong resistance and also would be a weekly double top pattern. My bias is on the long side, but right now I don’t expect to see a new weekly bullish trend. The important thing to know is that when we have a strong breakout, with strong volume and pace, and that pace is stronger than before the consolidation (60 min charts), we can expect more then an equal move. On the 60 min charts, that means a move to previous weekly highs and right now that will be my focus. All looks great, but before I will be 100% focused on that scenario I want to see Wednesday's open. Lately, after the FED announcement I have noticed that we have gotten the true direction the day after the FED announcement. That is the reason I am waiting to be 100% with the bulls. We took a few swing trades and if the market will confirm its' strength today, I will add to my positions. After the strong intraday move it will be hard to find new swing setups and I will be focused on intraday moves and current swing continuations.

Good luck trading today!!!!
Ivica Juracic
[email protected]