DOW S&P Weekly Report 16th August08

"I can see higher prices over the next two weeks:- but I would like to see a rotation down and test the Weekly 50% level early next week, and if that occurs then markets should continue higher into a higher close on Friday.

If that patterns play out but Friday can't remain above the monthly 50% levels, then it's beginning to look like these levels will be resistance and a 'sell' pattern could eventuate later this month..."

Previous Weekly Report

DOW and S&P Daily

This week played out precisely, with US markets reversing down into the Weekly 50% levels finding support and moving higher on Friday.

However, the concerning pattern was Friday's lack of buying power to close above the Monthly 50% level.

As mentioned in the previous Report, If Friday can't close above the monthly 50% levels on Friday it looks like the US markets could end up with a 'sell' pattern in the last week of August...

DOW and S&P Weekly charts

Often when markets breakout of the monthly channels they often come back and re-test the breakout and then continue with the overall trend. This is what's been happening in the US markets at the start of August, a re-test of the June breakout with the 'pop' pattern at the start of August.

So at this stage these upper levels are major resistance zones, but I would give it another another Week of trading to get a better idea on the trend in this quarter.

S&P Daily and 5-day pattern

As pointed out on Thursday:- trade longs above the blue channel, and then trade longs using Yellow support on Friday.

But like any previous 'BUY' pattern towards the 5-day highs, Friday failed to continue because of the monthly 50% levels resistance levels.

Next Week:- I won't have a view on US markets until the end of next Week.

Whilst price is trading above next week's 50% level price can follow the dynamic timeframes higher into next week's highs.

But a Weekly close below next week's 50% level and price begins to look like the 'sell' pattern at the end of August.

Day traders simply use the 5-day pattern levels, as per premium Report

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DOW S&P Weekly Report 9th August 2008

"If the market is going to rise higher and back towards the Monthly 50% level, then it's going to align with the start of August (SET-UP A)

If SET-UP A plays out then I'm looking for a move back down into the Yearly lows, but it might take a few weeks to unwind into a new down-trend."

26th July Weekly report

DOW and S&P Daily charts

US markets have continued higher at the start of August and have moved towards the monthly 50% levels, and Weekly highs.....

S&P 5-day pattern

The S&P and DOW 5-day patterns were very similar using the 5-day filtering techniques over the previous week, and with the expectation that markets would continue higher into Friday...

DOW & S&P Weekly charts

The August50% levels are major resistance zones, and I have modelled that there could be a reversal down towards August lows, as shown in the charts above.

However I don't think next week is simply going to be reversing down and into a 'blow' off bottom. Personally I would like that to happen because it's the pattern I have modellled for the markets to bottom out and move into a rotation back up towards the 3-month highs, as mentioned in last week's report. ....

"The Yearly lows in August-September.... once lows are reached it will align with a quarterly timeframe from October that could see the first major reversal back towards the 3-month highs in all global Index Markets"

As mentioned two weeks ago, any down move would have to unwind over the next couple of weeks, and if there is a continuation down it will probably occur in the last Week of the month.

Note:- it won't surprise me to see higher prices over the next two weeks:- but I would like to see a rotation down and test the Weekly 50% level early next week, and if that occurs then markets should continue higher into a higher close on Friday.

If that patterns play out but Friday can't remain above the monthly 50% levels, then it's beginning to look like these levels will be resistance and a 'sell' pattern could eventuate later this month...

For Day-traders and/or swings traders, it's once again using the 5-day pattern techniques when trading any moves next week.

S&P Weekly CASH

As illustrated at the start of July :- a bounce off these lows could see the S&P as high as 1329 this quarter, and if that's the case then next Week's 50% level is critical on the trend continuing higher.

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DOW S&P Report 2nd August 2008

DOW Cash Weekly chart

DOW should reach the Yearly lows in August-September.... once lows are reached it will align with a quarterly timeframe from October that could see the first major reversal back towards the 3-month highs in all global Index Markets.

S&P Cash Weekly chart

Same expectation in the S&P:- August-September lows should align with the Yearly lows.

DOW and S&P Weekly futures

June breakout down into the July lows, supporting the market, and now the expectation is that US markets are moving lower into August lows.

DOW Daily charts

Slight difference in the US markets compared to the Aussie Market.

Price needs to be trading below the mid-point in August @ 11267, to begin the next wave down towards the August lows.

DOW 5-day pattern

Basically you want to be trading on the right side of the blue channel on Monday.

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DOW S&P Weekly Report 26th July 2008

Expectation that the DOW is heading lower towards the Yearly lows in 2008, but along the way there will be short-term counter-trend from July's lows and a move back towards the -3-week highs and then continue down....
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Weekly Report 12 July 2008

DOW Weekly

DOW and S&P have reversed off their July's lows, and the expectation remains that price is heading lower in 2008....

DOW Daily

DOW moved UP from the lows hit the Weekly highs and has reversed back down into the Weekly 50% level....

Last Week global markets reversed down from their highs, but this reversal pattern was just a rotation back down into the Weekly 50% level.

There is a big difference between a reversal down this week and previous weeks, it's occurring above the weekly 50% levels and not below.

Therefore next Week can continue higher:- lower Weekly open and rising higher after it's verified the 3-day cycle support on Friday.


If the market is going to rise higher and back towards the Monthly 50% level, then it's going to align with the start of August (SET-UP A)

If SET-UP A plays out then I'm looking for a move back down into the Yearly lows, but it might take a few weeks to unwind into a new down-trend.


SET-UP B:- is simply the down-trend continuing from August, which normally occurs with the market opening below the August balance point and rejects down.

S&P Weekly CASH

Expectation that the S&P is rotating UP into 1329 and then continue down into the Yearly lows....

S&P Weekly and Daily charts

And that's going to depend on how well the Weekly 50% level support price next week, and then the August direction early the following week...

We can see the reversal down into the 3-day cycle and support has been verified on Friday, which is occurring above the Weekly 50% level.

This pattern is normally a 'bullish pattern', especially in BULL markets, but this isn't a bull market and I still have the view that markets are heading lower in 2008, but it might take another 5-days of trading to see whether set-up A or B plays out.

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DOW S&P Weekly Report 19th July 2008

DOW Weekly and Daily chart

Expectation the US markets would reverse up from these lower levels and begin a rotation back towards the Monthly 50% levels.

Expectation that these 50% levels are resistance zones, and more consolidation between last weeks lows and the 50% levels into August.

S&P Daily....

Weekly 50% level is the trend guide next week for any continuation higher into the 3-week highs.

S&P 5-day pattern.

The big difference between this reversal and the reversal in March is the 5-day range.

There hasn't been a breakout of the 5-day highs, and price is following a much more subtle rotation upwards.

Next Week:- I would use the 5-day highs as resistance, and simply trade the levels.

The 5-day 50% level will be the trend guide for any continuation upwards, which means support should be verified by a lower daily close and then trade longs up from a lower daily open.

In conclusion:- consolidation into August with an UP bias into the monthly 50% levels, and the potential of further weakness in the next month.

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DOW S&P Weekly Report 12th July 2008

DOW Weekly Charts

Expectation that the DOW is heading down towards the Yearly lows in 2008, but along the way there will be short-term counter-trend move back towards the 3-weeks highs and then continue down....

DOW Daily chart

On Friday the DOW reached the July's lows, and as pointed out, the first sign of a reversal is going to start with a breakout of the 5-day highs, and then a move above the Weekly 50% level, as it rotates back towards July's 50% level (3-week highs.)

And we can now see that the Weekly 50% level has now dropped below last week's highs, which isn't that far away for the market to begin it's rotation upwards.

S&P Daily

Same applies with the S&P, price is consolidating around the Monthly and Weekly lows, and a break of the 5-day highs will begin to attract buyers once above the Weekly 50% level.....

S&P Weekly

However, any rotation upwards into 1329-33, and then expectation is that price is moving back down into 1173 to finally find a low in 2008...

Note: any lows in 2008 is only seen as lows for this year, as i'm expecting lower lows in 2009 to finally bottom out the Bear Trend.

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DOW S&P Weekly Report 5th July 2008

The previous Weekly Report gives far more detail, and explains the current price action in the markets and my overall view

http://usindexweekly.blogspot.com/2008/06/dow-s-weekly-report-28th-june-2008.html

DOW Daily chart...

Expectation US markets would continue down into July's lows, and next week the Weekly lows are matching the lows in July.

My view is that once price reaches July's lows, there is more of a chance that US markets will begin a short-term reversal pattern into July's 50% level.

The first confirming pattern will be a breakout of the 5-day highs.....

S&P Daily charts

Once the breakout is confirmed, the 2nd confirming pattern is a reversal back towards the Weekly 50% levels in both markets, and then a continuation up towards the July 50% level in the following week after that.

S&P 5-day pattern

Once July's lows are reached, the trader needs to begin to optimise the trading on the BUY side using the 5-day patterns and the trend guide of the 5-day 50% level, along with the intra-day filters.

Note: I'm still expecting further weakness in all global markets, and any reversal upwards is only seen as a short-term counter-trend move until the Yearly lows are reached in all markets.

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