DOW S&P Monthly2nd Quarter target in the S&P is 1230 and we can see the MAY highs are now aligning with the upper target.
However, we are now trading the completion of the break and extend pattern during this quarter and the expectation that price is moving back towards the 3-month 50% levels.
The most robust set-up for a continuation of the down trend is a double top on the DOW early next week @ 11082...
And the holding pattern is until the start of MAY.
The UP trend won't continue until the start of the next month.
There are three possible patterns....
A. moves down into the MAY 50% level and then continues higher, as per 4th Quarter in 2009
B. moves down into the April 50% level and then consolidates for a couple of weeks below and then continues back towards the highs, as per first Quarter in 2010.
C. follows a double monthly low move into major support levels and the 3-Quarterly 50% level.
Don't discount #3, because the US markets will revisit the 3-month lows during the year and it hasn't as yet. We saw a similiar pattern in the Aussie market in the first Quarter.
Therefore:- depending on the how many contracts traded the bias is to hold into the the first target @ 1139 and then into the close of the month.
If there is a breakout of the 3-week lows next week, then there should be another 'short' set-up using the 3-Week 50% level the week after.
