SPI Daily 2nd September 2009 recap

"With the S&P breaking the week 50% level for the first time since June, there is now a bias for the SPI to continue down

That's going to depend on the Yearly 50% level @ 4455. It has played resistance for a number of days, and also played support for a number of days.

Below 4455 and the bias is to move down 42-44 points"

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SPI Weekly and 5-day pattern

SPI opened below 4455 and continued down 44 points into random support and the 5-day lows.

At this stage whilst below 4455 the overall view goes back to my original analysis of the market in the 3rd Quarter....

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I want to recap on the larger timeframe cycles in the market, and with
the S&P breaking support after reaching the Yearly 50% level @ 1038, and the
SPI back below 4455.

I pointed out that once price reaches the Yearly 50% level often the
pattern that follows is a move back towards the 4th Quarter 50% level before the trend continues higher.

Whilst below 4455 in September we can't discount that this is what
markets are trying to do instead of following the September high pattern.

More so, because I want to look for the most robust entries if trying
to capture another Quarterly rise in the market.
Buying around these highs there is too much risk so I want to BUY support, which is much lower.

Price can drift lower into the 4th Quarter 50% levels,
and then continue higher:- monthly 50% level but then continues higher in the
4th Quarter.

Or it can drop back down into around the July high breakout.

I mentioned a number of weeks ago, once price hit the Yearly 50% levels
I don't want to be BUying stocks unless there is a pullback into the
Quarterly support levels, and while we are still in the 3rd quarter
that pullback can be larger if the S&P follows the same pattern after reaching the
Yearly 50% level.







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