SPI Daily 18th December 2009 recap

"Expected weakness in US markets should hopefully provide the next leg down in the SPI.

For the next leg down to occur price needs to be breaking out of the 5-day lows (4612), however based on the sycom close that hasn’t been verified.

Therefore these lows could end up random support, or optimised to my view of the overall market and trend:- a breakout and next leg downward"

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SPI monthly and 5-day pattern

I’ve been bearish on the market because price has been trading below the December 50% level @ 4690, and last night’s price action in the S&P 500 favoured further weakness in the SPI…

The breakout of the 5-day lows @ 4612 started early, and I expected a continuation of the downward trend but it resulted in a fake break.

I was hoping the breakout would continue down, however the reversal pattern back above 4612 provided further 5-day pattern rotations which has been the norm for a number of weeks now.

A continuation of the short-term reversal pattern in the S&P 500 isn’t set in stone on Friday, if the market begins trading back above the 50% levels.








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