S&P 500Patterns in 2009 were…
1st Quarter 'thrust' pattern down into the lows and the reversal pattern into the
2nd quarter 50% level.
The 3rd Quarter 'Thrust' pattern away from the 50% level.
The October highs in the 3rd quarter and reversal down into the November 50% levels....
And lastly the 2-month wave pattern upwards from the November 50% level and into 1126, completing the precise movements between the 2009 lows and 2009 highs.
2010 should be an interesting year.... asI'm looking for the market to make its way down towards the 50% levels.
The only way I can get bullish in 2010 is for the S&P to be consolidating above 1153, but for that to happen I would need to see price come down first before it can go higher.
This is because it will shift the market dynamics allowing resistance levels to move higher dynamically later in 2010. At this stage I'm treating those upper levels as resistance.
At the start of next week, we need to determine whether the market will continue higher, or the market is going to reverse down towards 1087.
S&P 500 Monthly and Weekly
Last week's reversal down from 1126-28 has moved back down into the Weekly 50% levels.
Therefore it's a simple case of trading on the side of 1108-1110.
Whilst the market is above those levels then the expectation is to move towards the Weekly highs, and then towards 1142-53 the following week.
Below 1108 and the market is heading towards a critical support level within the secondary cycle pattern:- 1084-87.
