Any downside and 4781 is a random support zone.
A break of 4781, and there is an expectation that price will push down another 42-points"
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SPI Weekly and 5-day pattern
Even though I have an expectation of higher prices (Weekly highs) this week, today started with price trading around the 5-day highs with the expectation that any reversal down would complete 42 points.
4781 was seen as a random support zone today, because price was trading above it and not inside the channel, however there was a probability pattern that suggested more weakness today.
That pattern was the R42 range close @ 4778, which was a HOOK reversal pattern inside the channel, which will often continue another 42 points.
Once the R42 completed down into 4746, there wasn’t much left for the market to do, other than consolidate.
Today’s price action and sell down from Tuesday’s highs looks like the pattern that I thought might happen this week, as mentioned in the US market report on the Weekend
"The most robust pattern for any higher moves would be a choppy 5-day sideways pattern with the bias to drift down into the weekly 50% levels by next Friday..."
If this plays out in the SPI, the drift pattern is a move towards the Weekly 50% level @ 4689. For the UP trend to continue price needs to be trading above these support levels for the next 3-days.
Another 3-days in the market is a long time, especially when the S&P is already nearing the 4th Quarter target highs @ 1126, and in my opinion begins to exhaust itself coming into the last week of the month
In the mean time, the trend remains up with an expected 5-day sideways pattern until Friday.
That will change on a break of the 5-day lows and Weekly 50% level, which is a short-term bear pattern.
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