Presidents Day (public holiday) in the US and 'futures' in both the DOW and S&P still moved up towards the 5-day highs, and this will result in the SPI opening higher on Tuesday.However there is a big stink hanging over the Australian market, and with the news of Northern Rock in the UK going broke and being bailed out by the UK government to the tune of $50 billion this isn't going to help Australian banking shares, and it's not going to help the overall Australian market.
This Week's entire set-up was based on Monday moving into a 2-3 day rally on the back of US markets rising also. When the market opened below the 5-day 50% on Monday the entire weekly set-up basically fizzed.....
Tuesday:-
With Sycom closed overnight it doesn't give me a good idea of where the market will open, all I can do is define the daily trend using the above levels....
Risk levels are the 5-day 50% level 5595
And important level is 5654.... this level has been resistance a number of times during the past two weeks and it can provide resistance on open on any R44 fade down.
Don't short trade above this level because of the expected move towards the 5-day highs...
No high probability trades other than using timeframe levels and spiral points
Note: My view was for a 1 day rally in US markets on Monday, whilst above the Weekly 50% level the trend remains up and it can continue higher.
A bearish pattern in the US is a drop on Tuesday back below the Weekly 50% level, if this is the case the downside target on the SPI is the Weekly 100% levels @ 5288, and not helped by banking stocks which make up the largest weighting in the Australian Index
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