DOW S&P Weekly
The trend guide for the past 3 months has been the Weekly 50% level.
As pointed out last week, the September future contracts were running at a discount to the SPOT, which often leads to lower prices coming into expiry dates.
This resulted in US markets breaking their Weekly 50% levels on Monday and moving down into the Monthly mid-points.
The Monthly mid-points ended up supporting the markets, but continued to remain below the Weekly 50% levels.
Next week:- the Weekly 50% level drops and this be the new trend guide for the next 5-days of trading, and Monday should clearly give traders an idea about the direction.
There are 3 patterns that can play out.....
1. Weekly 50% level becomes another resistance zone sending US markets down once again.
2. Monday moves up and closes higher, resulting in a bottom to top close:- higher Friday close.
3. the next 5-days consolidates either side of the Weekly 50% level and continues to do so until the end of the month and the 3rd Quarter begins....
This will define where the next Monthly 50% level and the next trend begins in the
3rd Quarter.
Whilst price is trading above the 3rd Quarter 50% level I have a view of higher prices, especially if next week plays out either scenario of 2 or 3.
