S&P (e-mini ) 26th Dec 09 Weekly

S&P Monthly and Weekly

"After last week's price action I favour a continuation of the trend upwards, and towards the December highs.

Friday's reversal pattern off the lows now favours the probability of moving higher in the first 2-days. This will be verified by trading above the Weekly 50% levels, with a bias to move into the Weekly highs by Wednesday"....(Previous Weekly report)

Expected 2-day rise to begin the week playout with price reaching the Weekly highs by Wednesday and most likely continue towards the December highs next week.

The S&P 500 will complete the 4th Quarter target @ 1126 in the last week of the Quarter, and with the potential of continuing upwards in the first Quarter.

However, around those monthly highs in January I will be looking for any high probability patterns within the 5-day range to trade potential reversal pattern down towards the higher timeframe 50% levels.

DOW S&P 19th December 2009 Weekly

DOW S&P Monthly

After last week's price action I favor a continuation of the trend upwards, and towards the December highs.

Currently the market looks well supported, and at this stage markets look like continuing the Weekly rotating patterns of UP and DOWN 5-day patterns. (consolidation)


DOW S&P Weekly

Since the previous week’s HOOK pattern back above the Weekly 50% level I expected a move towards the Monthly highs within the first 3 days last Week.

I didn’t have a bearish set-up in the short-term as price wasn’t trading near resistance levels and price was above 50% levels, therefore the bias was to continue higher.

However, that bearish pattern appeared at midnight US time with Wednesday's close and Thursday's open pre-empting the change of the trend and break of short-term support: Weekly 50% levels.

I've seen these patterns before:- 2-days consolidation around the support levels and Wednesday moves higher but then drifts down and Thursday opens below the 5-day 50% level.

After 3-days of not going anywhere when the market should have continued higher on Wednesday, I could not be bullish when Thursday started the day below the 5-day 50% levels.

Thursday had a breakout of the 5-day low and as part of that move is a continuation of the trend down on Friday.

"There is a 5-day low breakout on Thursday and this normally favours a continuation down on Friday (below Weekly 50% levels)

I favour 50% level resistance & down but remaining inside the 5-day range on Friday"


If the trend was going to last longer then Friday shouldn't have found support around the 5-day lows, it should have broken out of the range once again.

Friday's reversal pattern off the lows now favors the probability of moving higher in the first 2-days. This will be verifed by trading above the Weekly 50% levels, with a bias to move into the Weekly highs by Wednesday.

In the short-term Monday's trading either side of the 5-day 50% level will verify whether that 2-day UP move is going to occur or not, as price could easily open below the Weekly 50% levels and push downward once again, breaking 3-week low support levels.

S&P (e-mini ) 12th Dec 09 Weekly

S&P monthly and Weekly


"At the start of next week I’m leaning towards a continuation down into Support levels, as part of Friday’s spike & resistance pattern, which often begins with the first 2-days moving down (2-day reversal)

If 'Support' doesn’t break on Tuesday (Wednesday trading below) then I would have to favour a higher weekly close thereafter.

Confirmed with a Daily ‘HOOK’ pattern back above the Weekly 50% level @ 1098 and a continuation towards the December highs"....Previous Weekly Report

This week's price action played out with the 2-day reversal on Monday and Tuesday, and then Thursday's break of 1098 (HOOK)

With the March contracts running at a discount to the current spot futures and next week's expiry, this can often push prices lower.

However, whilst the March 2010 contracts are trading above the 1098, the expectation is that that the trend will continue higher and follow the monthly dynamics into December highs.

DOW S&P 5th Dec 2009 Weekly

DOW S&P Monthly

Expectation of a 2-month wave upwards during this 3-month cycle:- November and into December.

There are monthly high breaks (closing above November highs), which confirms higher prices in December.

DOW S&P Weekly

I do have a view of higher prices in December, as part of a 2-month wave pattern upwards during this 3-month cycle, and that could occur using next week’s 50% level as support.

However, at the start of next week I’m leaning towards a continuation down into Support levels, as part of Friday’s spike & resistance pattern, which often begins with the first 2-days moving down (2-day reversal)

If 'Support' doesn’t break on Tuesday (Wednesday trading below) then I would have to favour a higher weekly close thereafter.

Confirmed with a Daily ‘HOOK’ pattern back above the Weekly 50% level and a continuation towards the December highs.

The key levels in an UP trend are the monthly 50% level and the 3-week lows, and that's the key support levels that need to hold, if Monday and Tuesday follows the 2-day reversal pattern.