Macro micro trader

While I had alerted about this on Twitter last Thursday, lets take a close look again and see what lies ahead:

ES futures: As posted on twitter, this formation gravestone doji is first sign of reversal on the weekly chart. Last week it barely bounced from the 20 weeks SMA. Bears have got an edge for themselves in the coming week to take it forward under these key levels on the weekly and the daily.

4475-4500 – the 200 SMA area is the only hope for the bulls. But given the fact that markets have already broken it in the recent past and sustained it for many days before breaking past it in the recent rally, is enough sign that 200 DMA won’t hold as a strong support this time.

What may work in favour of the bulls though is trend changing key indicator for the trend following traders: 20-50 SMAs crossing to the upside. Last hope for the bulls

NQ (Nasdaq 100 futures): Bears have it in control. Non-sustenance of 20-50 weekly SMAs, non sustenance of 200 DMA on the daily and double top reversal.

I would stay short the tech index NQ, keeping last week’s high as a stop.

YM (E-mini Dow Jones futures): Another key futures and another bearish close on the weekly charts similar to the NQ – weekly close below 20 and 50 SMAs. What would be more bearish is the formation of rising wedge on the weekly which is on the verge of breakdown on the resumption of this downtrend.

On the daily too, it has closed below 200 days SMA. I would stay short the industrial futures too with last week’s high as my stop.

Conclusion: Bears have it in control and risk reward is favourable for shorting here on all the key index futures.