- WE'RE JUST RANDOM SPECKS OF DUST IN A TORNADO TO THE MARKETS .......
- CHARTISTS MUST PUT ALL BIAS ASIDE AND LET THE CHARTS DO THE TALKING OR WE'LL SEE ONLY WHAT WE WANT TO SEE
- This blog has a copy of all header posts that I publish anywhere, so that those interested in seeing what my thoughts are on the markets can find them easily.
- I will be answering questions and responding to comments, so feel free to respond to any posts and I will see your comment even if it is not on the most recent post.
- If you're interested in seeing any intraday charts I post, I do that on twitter, and my twitter handle is @shjackcharts.
- The charts in the posts are as large as I can practically make them. if you would like to look at one more closely, click on it, and the link will take you to a larger version at screencast. If you click on that again, you will get a full page version, and can use the resizing function on your browser to enlarge parts of interest further.

Tuesday, 25 July 2017

Once More Into The (Potential) Breach Dear Friends

The rising wedges that I was looking at on Thursday broke down and have been retesting the all time highs last night on NDX, and this morning on SPX, with another possibly coming on RUT though Stan's thinking lower high there. We are looking for a failure today on SPX anywhere from a marginal new high up into the 2482 area, and so it's possible that this short term high is already made. On the bigger picture this is a possible swing high, but we'll have to see whether any serious breakdown can be sustained from here. This has been a very persistent uptrend.

On SPX a 60min RSI 14 sell signal is now brewing, though a few handles higher into the short term high would improve the look of this divergence. SPX is testing trendline resistance. SPX 60min chart:
On NDX a very decently formed 60min sell signal is brewing. A retest of last night's globex all time high would set a possible 60min sell signal brewing on NQ as well, and we may need to see that. . NDX 60min chart:
The ES, NQ and TF futures charts below were done an hour before the RTH open for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here.

ES looks cooked here. A retrace and higher high on negative divergence would improve the high. ES Sep 60min chart:
NQ may already be breaking down. Under 5900 the swing high is likely made. Until then I'm wondering about a possible retest of last night's high to set a possible 60min sell signal brewing. NQ Sep 60min chart:
TF made the 60min sell signal target and is close to a retest of the all time high there. That retest isn't required before this high but we may see it anyway. TF Sep 60min chart:
We should see this high today and, if seen, this will be a decent looking candidate swing high, though it's obviously been hard to sustain a downtrend long on equity indices so far this year. We'll see how this one goes.

Stan and I did the fourth webinar in our 'Managing Risk In Trading' series at theartofchart.net last Thursday, and if you would like to see the recording that is posted on our July Free Webinars page. This webinar looks at Stop Systems and Trade Repair. This week's edition of The Weekly Call is posted and the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Thursday, 20 July 2017

The Wheels On The Bus Go Round And Round

Apologies for the intermittent updates over the last couple of weeks. It's been very busy and I'm hoping to get back to posting every day again next week.

So another round of new highs and I read that the Vix has fallen to a 24 year low this week. There is an emerging consensus that equity indices will never drop meaningfully again and SPX and NDX are getting close to some big round numbers in the 6000 and 2500 areas respectively that are likely to develop a magnetic pull the closer SPX and NDX get to testing them.

So is it time to write off the bears altogether? Well we'll still likely see at least retracements when the setups are right for them and as it happens the retracement setups are looking pretty good right here, though to develop negative divergence on the daily charts we would likely see retracements and then marginal new all time highs on both before any larger move. Those marginal new all time highs, at this point, could test those big numbers at 2500 and 6000.

The move from the last low has formed a decent little rising wedge that has taken SPX to resistance on a decently formed larger rising wedge from the March/April lows. No negative divergence on the hourly or daily charts. SPX 60min chart:
The setup isn't as bearish on NDX, but there is a decent rising wedge from the last lows which is very steep and likely to need at least a retracement soon to establish a less vertiginously steep support trendline. NDX 60min chart:
The ES, NQ and TF futures charts below were done an hour after the RTH open for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here.

On the futures charts the negative divergence here is much more encouraging. I updated these charts an hour after the open today as by then 60min sell signals had fixed on all of ES, NQ & TF.

ES has slightly overthrown wedge resistance on a decent rising wedge from the last low. In the event of a sustained break over wedge resistance I do have an alternate channel option with channel resistance currently in the 2490 area. ES Sep 60min chart:
On NQ there is a similar rising wedge, with the wedge resistance trendline somewhat weakened by two overthrows rather than just one. Again there is a decent alternate trendline above but if there hadn't already been a 60min sell signal fixed, another would have fixed this morning. NQ Sep 60min chart:
Decent looking rising wedge on TF too. TF Sep 60min chart:
This is a very decent looking retracement setup, probably not quite cooked yet. I'll be keeping a close eye on it.

Stan and I are doing the fourth webinar in our 'Managing Risk In Trading' series at theartofchart.net an hour after the close today, and if you would like to attend then you can register for that on our July Free Webinars page. This webinar is dealing with Stop Systems and Trade Repair. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Monday, 17 July 2017

Looking For Some Retracement Here

NDX has made it over halfway from the break of the flag to the retest of the all time high, and I am treating that retest as the 70% likelihood option here. On the way though there is a lot of short term negative divergence that will likely deliver a retracement, maybe today but otherwise tomorrow. On NDX that may well require a retest of the short term high first. NDX 60min chart:
NDX has broken back above the H&S right shoulder so as well as the flag channel target back at a retest of the all time high, there is also a failed topping pattern / Janus flag target there, also at that retest. NDX daily chart:
Stan and I are thinking that we see a retracement from this area, then another leg up that at least retest's Friday's high before this move can finish. We are still leaning overall towards a resolution into a bearish expansion here, though we could obviously see the still looking less likely bullish expansion instead and that needs to be borne in mind. Either way, this retracement, if seen, should set up a decent buyable dip. SPX daily chart:
The ES, NQ and TF futures charts below were done before the RTH open for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here.

So where might this retracement go? Well the usual target would be a test of the new weekly pivot on ES, which is at 2443. If the current short term high area holds then an possible extension beyond into the 2439 area to hit the 38.2% fib retrace target and the established support shelf there would be a real possibility. We wouldn't be expecting any sustained break below the weekly pivot. ES Sep 60min chart:
The new weekly pivot on NQ is at 5781.50 and that isn't tested as reliably every week, but is on the cards with the decent quality negative divergence on both the NDX and NQ hourly charts. NQ Sep 60min chart:
I wrote on the TF chart earlier that the all time high retest there might need to wait until after this likely retracement but TF just managed that at the high this morning,so of these three only NDX/NQ has an outstanding likely all time high retest still not completed. TF Sep 60min chart:
The short term high may be in and the retracement may be in progress already. If so the retracement has started off slow and choppy and may continue that way as well of course.

Stan and I are doing the fourth webinar in our 'Managing Risk In Trading' series at theartofchart.net an hour after the close on Thursday, and if you would like to attend then you can register for that on our July Free Webinars page. This webinar is dealing with Stop Systems and Trade Repair. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Friday, 14 July 2017

A Tale Of Two Bull Flags

SPX and NDX both delivered breakaway gaps up on Wednesday that were not filled. Both of the possible bull flags that I was looking at on SPX/ES and NDX/NQ as the lower probability alternate on Wednesday morning broke up, and SPX and ES have made the minimum bull flag targets at the full retests of their all time highs this morning. So what now?

This is a smaller but still significant inflection point here at the marginal new all time high on SPX/ES. The possible SPX daily RSI 5 buy signal that I was looking at on Wednesday morning fixed and has made target, and it's possible that SPX / ES will make marginal new highs here in the second highs of double tops. If so, ideally, there would be a pullback in this area and then marginal higher highs to set up a daily RSI 5 sell signal on SPX.

This would be that headfake possibility that I mentioned on Wednesday's post if we were to see a break up on Wednesday. That would generally involve a touch of the daily upper band, touched at the AM high today, and then a rejection there that would not need to be seen today back into the lower band. SPX daily chart:
There is support for this scenario on ES, with a decent quality rising wedge forming from the low this week, and since I capped this chart rising wedge resistance has been tested. Watching to see what happens here, but I'd note that ES is already on a 60min sell signal. ES Sep 60min chart:

The NDX bull flag has also broken up with a minimum target at a retest of the all time high of course, and the key question here is whether NDX is going to need to make that target. I'm considering an alternate scenario where the falling wedge flag evolves into a falling channel (also likely bull flag). If seen that would likely only defer that all time high retest or weeks rather than months though. There is a lot of hourly negative divergence on NDX here with both RSI 14 and RSI 5 sell signals brewing there. NDX 60min chart:
There is also already a 60min sell signal fixed on the NQ chart, suggesting that a retracement at least is close, even if the all time high retest follows that soon after. NQ Sep 60min chart:
Looking at our Big Five charts in the webinar at theartofchart.net last night we were both doubtful about an all time high retest on NDX here short term, but maybe. Time, and price of course, will tell. If you missed last night's webinar then you can see the recording posted on our July Free Webinars page. Everyone have a great weekend :-)

Wednesday, 12 July 2017

Breaking Down Is Hard To Do

Another week, another inflection point on indices, and after eleven days of compression we are likely to see a resolution up or down today and whichever way this resolves is likely to deliver a daily upper or lower band ride in the direction of the break. Today is a cycle trend day and the odds of seeing a full trend day in either direction are unusually high. We'll see how that goes. The setup favors downside resolution, but the day is starting with a spirited attempt at a break up. We'll see whether that lasts.

I'll start with NDX here as Nasdaq is still driving the equities bus, and on NDX there is a possible H&S right shoulder forming here that is currently overshooting the ideal right shoulder high, but not to an extent that weakens the setup. There is an alternate read that a bull flag forming wedge is forming here, and if that wedge resistance currently in the 5800 area is tested from here then that option becomes a lot more likely. If that bull flag wedge was then to break up the minimum target would be an all time high retest on NDX. NDX 60min chart:
NDX broke over the daily middle band yesterday and needs a confirming close above today to open a possible test of the daily upper band at 5827. If NDX were to get that far I'd be looking for an all time high retest as the highest probability option. NDX daily chart:
Daily middle band resistance has been solid resistance on SPX over the last few days but SPX has gapped over it this morning and is well on the way to the upper band in the 2450 area. This may be a breakaway gap up on SPX but the break needs to be sustained into the close and needs to be confirmed with another close over the middle band tomorrow unless the upper band is hit beforehand.  A breakaway gap is bullish as long as that gap is not filled. If it is filled then it becomes a likely failed break up and becomes bearish. SPX daily chart:
The ES, NQ and TF futures charts below were done before the RTH open for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here.

On ES possible flag channel resistance has broken up and the minimum flag target would be at the all time high retest at 2452. There is an SPX version of this flag channel that has been established at the 2444.18 high this morning and would be breaking up at 2446. All time high retests likely at the stage IMO. ES Sep 60min chart:
On NQ the rising megaphone is no longer in play. Stan has key resistance at 5774 and I have flag channel resistance currently in the 5790 area. So far today NQ has been seriously underperforming ES and TF which may be significant. As I said, Nasdaq is driving this bus. NQ Sep 60min chart:
Whatever happens on TF for the rest of the day an all time high retest is likely.  TF Sep 60min chart:
An expansion is likely starting here and a daily band ride in one direction or the other is likely. This would often start with a headfake in the other direction and I'm wondering about that possibility here. We'll see. A sustained break in either direction may well run a while. If the obvious H&S setup on NQ resolves down and makes target that would be a decline of about 10% from here, so that would be a very serious move. We'll see how that goes today.

I have to be out most of the rest of the morning on offspring chauffering duties. Back lunchtime.

Stan and I are doing our monthly free public Big Five at theartofchart.net an hour after the close on Friday, and if you would like to attend then you can register for that on our July Free Webinars page. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Thursday, 6 July 2017

Inflection at 2400

SPX rejected from the backtest of the daily middle band yesterday and came close to a retest of last week's low at the intraday low today. There is a compelling case for seeing that full retest tomorrow as well as a retracement low retest on NQ and that the next important inflection point is there. I'll be looking at why that is below. SPX daily chart:
NDX is on the fifth day of a daily lower band ride and has backtested the broken H&S neckline. If NDX can deliver a sustained new low I'll be looking for the H&S target in the 5360 area. NDX daily chart:
The ES and NQ futures charts below were done before the RTH open for Daily Video Service subscribers at theartofchart.net, except for ES which was updated at about 11am. If you are interested in trying our services a 30 day free trial is available here.

So, the inflection point ..........

On ES I have a falling channel in purple trendlines, and the channel support trendline is now in the 2398/9 area, just above the 50% retracement of the rising wedge from the May low. If that trendline is tested and holds, then there would be a decent looking setup to head back to channel resistance, and with the low close to the 50% retrace target there would be an excellent case that the channel is a bull flag channel setting up a retest of the all time high, in a likely second high of a double top.

The bear option from the inflection point is that if that channel support trendline doesn't hold as support, then that same trendline also works as the neckline on a decently formed downsloping H&S, and on a sustained break below the H&S target would be in the 2355 area, though the obvious target by then would be a full retracement back into the May low at 2341. ES Sep 60min chart:
The bear option for NQ is already laid out on the NDX chart, but the bull option here is well worth a look. The short term falling wedge broke up slightly yesterday and there is therefore a good case that the retest of the current retracement low on NQ would be making the second low on a double bottom. That wedge is part of another falling channel that would not be a likely bull flag in this instance. A retest of the lows and rejection back up would set up a possible return to channel resistance, slightly over 5800. NQ Sep 60min chart:
TF looks as though a triangle is forming here. That leans weakly bullish and there is still potentially unfinished business at a dull retest of the all time high. TF Sep 60min chart:
I'm leaning strongly towards seeing ES and NQ retest their retracement lows tomorrow and make at least marginal new retracement lows. At that point price will need to make a decision. On a rejection back up there is still a good case to see full all time high retests on ES and TF, and potentially on NQ as well, though that is more of a stretch. On a sustained break below the current retracement lows, we should see a move to the next target areas below.

Stan and I did our monthly free public Chart Chat at theartofchart.net on Sunday and if you missed that you can see the recording posted on our July Free Webinars page. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Wednesday, 5 July 2017

Backtesting Resistance

I posted my premarket video on my twitter before the open today and if you missed that then you can see that here. I included charts on XLE and XLF today.

On SPX the daily middle band was backtested today and was respected. As long as that remains the case on a daily close basis then last week's low at 2405.70 should at minimum be retested soon. SPX daily chart:
NDX rallied almost to the backtest of broken H&S neckline support today. If NDX breaks higher into a retest of the daily middle band in the 5730 area then it might well then be forming the right shoulder on an alternate H&S. As long as that holds the next big downside target area is rising support from June 2016 in the 5410 area. NDX daily chart:
The ES and NQ futures charts below were done before the RTH open for Daily Video Service subscribers at theartofchart.net, and are the ones shown on the video linked in the first paragraph. If you are interested in trying our services a 30 day free trial is available here.

ES broke over declining resistance today and that opens a possible retest of the 2436/7 area, though I'm doubtful about that unless NQ needs to go higher. ES Sep 60min chart:
NQ may need to go higher, as falling wedge resistance broke at the highs today. This morning's 60min buy signal made target but the double top target in the 5680 area was not quite hit and may well be unfinished business for tonight or tomorrow. NQ Sep 60min chart:
TF didn't move much today. Clear support and resistance. Still wondering about that possible all time high retest. TF Sep 60min chart:
NQ and ES both have possible unfinished business above tomorrow morning. Tomorrow is a cycle trend day with 70% odds of being dominated by one side or the other. Historical stats for Thursday and Friday this week are mildly bullish tomorrow and neutral on Friday.

Stan and I did our monthly free public Chart Chat at theartofchart.net on Sunday and if you missed that you can see the recording posted on our July Free Webinars page. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Thursday, 29 June 2017

Are We Having Fun Yet?

I posted my premarket video on my twitter before the open today as I was going out and wasn't certain I'd be back before the close and if you missed that you can see that here. What I was talking about on ES here was a high quality falling megaphone that had formed on ES on which pattern resistance had been tested twice overnight. If that continued to hold then the likely retracement targets were either a 50% retracement back to the 2430 area or a move back to megaphone support, hit at lunchtime today at 2408.5 and very possibly bullishly underthrown at the current intraday low at 2402.25. This brings us to another important inflection point.

I was saying yesterday morning that if an H&S was forming on SPX then the ideal right shoulder high would be in the 2446 area. Yesterday's high was a close match at 2443, and the move today has retraced back to the neckline and broken down slightly through it with an H&S target in the 2385 area if this break down is sustained. If it isn't sustained, and the bull flag megaphone plays out, then this is another Janus flag, and with the bull flag falling megaphone underthrowing bullishly on ES, if we see a strong rejection back up here then there would be a high probability target back at a retest of the all time high, which would fix on a break over flag megaphone resistance on ES, currently at 2444/5. SPX daily chart:
I was also talking about a possible H&S forming on NDX yesterday morning and that too has completed and broken down with a target in the 5380 area. In theory the same double top / Janus bull flag calculation applies on NDX, but that's complicated by the also perfectly valid alternate triangle setup that has also completed and broken down there. We're going to need to see what NDX does next to discern which pattern we are looking at but on both triangle and Janus flag cases we would likely see a strong rally back over the neckline/triangle support in either event. NDX daily chart:
The ES and NQ futures charts below were done before the RTH open for Daily Video Service subscribers at theartofchart.net, and are the ones shown on the video linked in the first paragraph. If you are interested in trying our services a 30 day free trial is available here.

ES made it back to megaphone support and has underthrown that at the low in a very possible bullish underthrow. The underthrow means that at the next test of falling megaphone resistance, currently at 2444/5, that trendline would likely break, fixing a minimum bull flag target at a retest of the all time high. ES Sep 60min chart:
I gave key resistance on NQ yesterday at the weekly pivot at 5768 and that was broken slightly but never converted to support before today's slide began. As I've been saying, NQ is driving this bus. NQ didn't quite reach my channel support trendline but the current low has established a possible falling wedge resistance trendline. If that holds the next target within the wedge will be falling wedge resistance, currently in the 5753 area and falling rapidly. NQ Sep 60min chart:
TF has retraced to retest Tuesday's lows. There's a good case for seeing an all time high retest as long as we don't see a hard break down there. TF Sep 60min chart:
SPX tested the 3sd (three standard deviation) lower band at the low today and that is generally good for at least a decent rally,  which we have been seeing. Tomorrow is a cycle trend day and there is a decent bull case here arguing that we might see a very strong rally tomorrow, possibly adding a fourth crazy reversal candle to the three huge back to back candles put in Tuesday through today. I like the bull scenario from here though it's it's best to stay flexible and not get married to either longs or shorts. Whatever happens we have just finished a long period of compression and have started what is likely to be a significant period of expansion. That's likely to last through July into August on our projections so don't expect a fast return to business as usual.

Stan and I are doing our monthly free public Chart Chat at theartofchart.net on Sunday and it looks like we'll have a lot to talk about. If you would like to attend you can register for that on our July Free Webinars page. Seats are limited to 500 and we already have more registrations than that (some of whom won't attend) so if you would like to attend I'd suggest doing that sooner rather than later. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Wednesday, 28 June 2017

Backtesting The Breaks

That was a very nice day on NQ yesterday. I was looking for resistance at the weekly pivot at 5768, and the RTH high was 5764. The target on a fail was 5641 and that was slightly exceeded in globex (buffs fingernails modestly) before the start of the rally that we are seeing today. Does this mean that the seventh seal has been broken and the Bearpocalypse has begun? Um ... no, but this swing high may well finally be in, subject to what we see on these rallies/backtests.

On SPX the obvious resistance is the daily middle band (daily closing basis). That's being tested at the moment.  SPX daily chart:
On NDX the daily middle band should be a backstop rather than a strong target here. That's at 5775 with breakaway gap resistance there into Monday's close at 5779.59. If the swing high is in on NDX then that gap should not be filled. A gap fill opens up a possible all time high retest, in what would likely be the second high of a double top if seen.

It was easy to miss if you were watching the big gap up on SPX today, but NDX only delivered a small gap up today that was quickly filled into lower lows under yesterday's lows. The current low on NDX is an exact touch of an important trendline that is support on one of two likely patterns here. Option 1 is that NDX has completed forming an upsloping H&S there and on a sustained break below the neckline would look for the 5400 area. Option 2 is that the trendline is support on a classical symmetrical triangle which would likely be starting Wave E here. If the triangle is going to break down then there would be no need to retest triangle resistance, currently in the 5820 area. I'm leaning towards the H&S option. NDX daily chart:
The ES and NQ futures charts below were done after the RTH close for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here.

On ES key resistance on this backtest is the weekly pivot at 2437.25. Bulls failed to convert that to support yesterday and need to fail again today for the downtrend to resume. The 60min buy signal that fixed overnight has reached target. ES Sep 60min chart:
On NQ Stan gave the ideal backtest target in his video last night (for daily video subscribers at theartofchart.net) at monthly pivot at 5733. The HOD on NQ so far on NQ is at 5728/9 so that's being tested now. The 60min buy signal that fixed overnight has not yet reached the possible near miss target. NQ Sep 60min chart:
On TF the double top broke down and made it halfway to target before reversing hard with ES and TF broke back over key resistance at the weekly pivot at 1409.7. I was warning in my premarket video this morning (for daily video subscribers at theartofchart.net) that if weekly pivot was converted to support then TF would likely retrace back to the last high 1420/1 (another Janus flag), and TF has done that. Possible all time high retest coming on TF. TF Sep 60min chart:
I'm leaning towards a bearish resolution at these backtests, and we'll see how that goes. The rallies on ES & TF have been strong, but it feels like a bear market rally, and TF leading, closely followed by ES with NQ trailing at the back isn't a bullish looking sequence. I am concerned about the holiday weekend approaching though , we'll see.

Stan and I are doing our monthly free public Chart Chat at theartofchart.net on Sunday and it looks like we'll have a lot to talk about. If you would like to attend you can register for that on our July Free Webinars page. Seats are limited to 500 and we already have 450 registrations for that so if you would like to attend I'd suggest doing that sooner rather than later. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.

Tuesday, 27 June 2017

Nasdaq Support Breaks

I'm leading with the NDX and NQ charts this morning as they are driving the equities bus here. I posted my morning video for Daily Video Subscribers at theartofchart.net on twitter before the open and if you missed that you can see that here.

NDX broke back over the daily middle band on Friday and that break needed to be confirmed with another close over that on the next trading day, and NDX failed to deliver that yesterday, which was a bearish development. NDX daily chart:
SPX almost retested the all time high yesterday and came close enough for that to be the second high of a decent quality double top setup. RSI still pointing firmly down of course and if we break double top support at 2430.74 then the second high being lower increases the odds that this might be another bull flag forming. Mainly direction is about NDX/NQ here though. SPX daily chart:
The ES and NQ futures charts below were done after the RTH close for Daily Video Service subscribers at theartofchart.net. If you are interested in trying our services a 30 day free trial is available here. I have updated the charts with prices up to when I started writing this post.

NQ broke both rising wedge support and the weekly pivot overnight, which was a serious sign of weakness and may mean that the main decline that we are looking for to 5641 and lower has already started. If weekly pivot at 5768 converts to resistance this morning then NQ is likely on the way to 5641 in the near future. NQ Sep 60min chart:
There is still a possible triangle setup on ES here where this decline from yesterday's highs is a backtest into the triangle before a thrust up into the all time high retest that we didn't quite see yesterday. A break below 2427/8 kills that triangle option and opens the downside. ES Sep 60min chart:
TF has slightly broken rising megaphone support and needs to break weekly pivot and double top support to open the likely retracement back to 1393. The numbers are on the chart. TF Sep 60min chart:
The main decline that we have been looking for may well now have started, but bears still have some work to do on the downside to preclude possible upside as part of topping patterns on SPX/ES & NDX/NQ. 70% odds here that we head directly lower from here IMO, and the most important numbers that I am watching this morning are the NQ weekly pivot at 5768 and ES support at 2427/8.

Stan and I are doing our monthly free public Chart Chat at theartofchart.net on Sunday and it looks like we'll have a lot to talk about. If you would like to attend you can register for that on our July Free Webinars page. I would also note that this week's edition of The Weekly Call is posted and that the model portfolio there is up 170% in the seven months to June 23rd, obviously well on course to make our target minimum 200% return over the first year. As and when that target is reached we're thinking of making the strategy there a bit less conservative. That's a free weekly service and if you trade futures I'd suggest adding it to your reading list.