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 WeeklySince 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.
