2014/01/27 Nice example of a 30-min squeeze trigger in the S&P 500 (ES, SPY, SPX, RUT, IWM)

S&P 500

Just as forecasted in the blog below of January 21, a larger move occurred in the S&P 500 (and most other indexes) after the tipple-squeeze had built up "over pressure" that need to be released. In the earlier blog it was also mentioned that the 30-min squeeze could be used as a trigger in order to decide, in which direction the S&P 500 would fire (long or short). This trigger decision has worked out beautifully in this case and is therefore displayed here as a generic example. 

In the figure above the cursor resides on the Jan 23 candle in the daily chart. The program automatically highlights the time period of Jan 23 in the 4-h and 30-min charts. While the squeezes of all three charts fired short on Jan 23, the 30-min squeeze was the first one to do so. In order to catch the big move, one would use the firing 30-min squeeze as the trigger, and then carefully observe if the other squeezes follow suit in the same direction. The stop loss would be placed fairly tightly in the 30-min chart, preferably above a Fibonacci Cluster or some other resistance level.  

Once triggered, the release of the over pressure typically takes place during 6-8 bars before the squeeze momentum dies down. This also applies to the S&P 500 daily chart, which today is only three days (=bars) into the momentum release triggered on Jan 23. So I expect more movement downwards ...

2014/01/21 S&P 500 and Russel 2000 consolidating with daily-squeeze and 4hour-squeeze patterns - expect a larger move ! (ES, SPY, SPX, RUT, IWM)

 S&P 500

Russel 2000

Two important indices, the S&P 500 and the Russel 2000 are consolidating with daily- and 4-hour squeeze patterns (the Russel even features a 30-min squeeze, too). When squeezed too hard, these "babies" like to escape from their cages, and they tend to do this at an accelerated pace that might last for a few days. While the direction of this move is still unclear, the momentum indicators on the 4-hour charts hint for higher levels of those indices. The 30-min squeeze of the Russel 2000 could be used as a trigger, when it fires long or short. 

2014/01/14 ES (SPY, SPX) at strong Fibonacci Cluster Support - will it hold?

After yesterday's significant sell-off, the E-mini S&P 500 Futures formed a large red candle that has reached an important Fibonacci support cluster. Today's price action will show if this support level can hold. If so, the rally might continue with upside targets in the 1852 - 1857 range.