Once the next 5-days are over, then the week after next will let us know whether the trend follows the September low pattern using the Monthly 50% level as the trend guide.
If that happens then my bet is that Obama will announce QE3 somewhere around those September lows, which will underpin the trend for the rest of 2011 (Previous Weekly report)
S&P monthly and Weekly cycles.
Current price action has played out accordingly, with August lows supporting the trend, the market moving up into the Weekly highs, and then selling down from the Weekly highs.
Further weakness was confirmed with Thursday’s close below the key weekly trend levels, and Friday followed, as part of a September 50% level rejection pattern towards new lows
My view is that over the next 10-days the market moves down towards the September lows.
I previously said that the down trend is towards 1045 & the Yearly lows, but it might not get that low...as the target is now 1078-1085 based on the Weekly cycles.
I'd keep an eye on any 'lame' Obama announcements around those lows (or 1045), as this will underpin the market for the rest of 2011.
Note:- in the short-term it won't surprise me to see the S&P move upwards as part of a 2day 'stall-reversal pattern', using the Weekly 50% level as the trend guide...
But i'd be surprised to see the market trading above 1217 over the next 5-days.
Trend bias is DOWN, helped by the Weekly levels.
