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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
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Saturday, July 23, 2011

Make mine a "Mean" "Double-Double"...

Friday's post below was about an intraday "bigger picture" look at where the YM, ES, NQ & TF were trading in relation to two regression channels...the larger uptrending regression channel begins from last December and the smaller downtrending channel begins from May of this year.

The following updated 4-hour chartgrid of the YM, ES, NQ & TF shows where price closed on Friday in relation to these channels:
  • YM closed just above the "mean" of the larger channel and in between the +1 and +2 deviation levels of the smaller channel
  • ES closed a little above the "mean" of the larger channel and in between the +1 and +2 deviation levels of the smaller channel
  • NQ closed a little below its +1 deviation level of the larger channel and a little below is +2 deviation level of the smaller channel
  • TF closed a little below the "mean" of the larger channel and just above the +1 deviation of the smaller channel

The next chartgrid of the 4 e-minis depicts a Weekly timeframe which also has two regression channels plotted on each chart. The larger regression channel begins from the October 2007 highs and the smaller channel begins from the March 2009 lows. In the case of the YM & ES, the larger channel is still trending downward, while the NQ & TF larger one has turned up.

The following information describes where price closed on Friday in relation to these channels:
  • YM closed just above the +1 deviation level of the larger channel and just below the "mean" of the smaller channel
  • ES closed a little above the +1 deviation level of the larger channel and just below the "mean" of the smaller channel
  • NQ closed a little below its +1 deviation level of the larger channel and just below the "mean" of the smaller channel
  • TF closed just above the +1 deviation level of the larger channel and just below the "mean" of the smaller channel

In order to resume an updward trek on a Daily timeframe, it will be important for all 4 e-minis to recapture and stay above their respective Weekly "mean" on the smaller regression channel.  That will also entail the recapture of the 4-Hour "mean" on the larger regression channel by the TF, and then a hold above the "mean" of this larger channel by all 4 e-minis.

This is what I'll be looking at next week during market hours as one gauge of strength vs. weakness in these e-minis.

***BTW, even though the NQ is outperforming the other e-minis on the 4-Hour timeframe (and the TF is the weakest) (using these channels as a measurement of relative strength/weakness), it is actually very slightly underperforming the TF in relation to where it is within the larger channel on the Weekly timeframe (notwithstanding the fact that it made and closed at an all-time new high on Friday)...and the TF & NQ are both outperforming the YM & ES in relation to this larger Weekly channel inasmuch as they've made new all-time highs and their channels are now uptrending. The TF is one to keep a close eye on...a wolf in sheep's clothing perhaps?