S&P DOW Index Weekly 29th March 2008

S&P CASH Weekly Charts

Consolidation currently around the Quarterly lows, and with 1 day remaining until the Next Quarterly timeframe begins, those lows are much further down from Next Week.

However, I don't see the S&P going that low in the next Quarter (1189), but I do see the Yearly lows @ 1238 being touched before any Major reversal UPwards.


DOW CASH Weekly charts

The Yearly down trend began in 2008 with the move down from the Yearly BP, and confirmed with the break of the previous Quarter (Sept-Dec).

This Quarterly timeframe has pushed down, but it has remained in a major 3-month sideways pattern trading around the Quarterly lows.

Those Quarterly lows push lower in the next Quarter, so there's potential to move lower inthe next Quarter, where once again it will find support and consolidate.

The Yearly lows are much lower, and if it gets that low it will probably take another 6-9 months for that to happen. If price is following the Quarterly patterns lower, then it will take 2-3 Quarterly timeframes to even get that low.

And that's a long time in any trader's language.

Until then, the S&P will probably find support around the Yearly lows, and reverse back up into quarterly 50% levels.

And Yes....US Markets could end up moving back towards the Yearly Balance points, where it all began in 2008. But again it's going to take a number of months for that to happen....


DOW and E-mini Daily Charts

"Since the start of 2008, US markets haven't been able to trade and remain above the Weekly channels highs.

Those Weekly channel highs are shown above and the expectation remains that those highs are resistance...I would like for this Month to complete and then use the April 50% level as a trend guide for next quarter.

Weekly 'highs' resistance for another Week before using the April 50% level next month as a more robust trend guide if US markets are going to continue into higher prices." ( Previous Weekly report)

And the Weekly highs have remained resistance, and has pushed back down towards the April balance point.

The April Balance point from Tuesday is going to be the trend guide on whether price is going to move higher, or continue with the Quarterly ranges into lower lows.


E-mini intra-day 5-day chart

I've only put in the E-mini intra-day chart but the DOW is exactly the same.

The expectation that the Weekly highs would be resistance this week and push back down, and the two highest probability DOWN days were:- Wednesday and Friday with Price breaking Risk-Support.

This makes it much easier for a trader in Australia to be trading US markets.

And it makes no difference for any other trader around the globe.

Next week expectation to push down into Daily support, which should then align with the April balance point.


please refer to the daily Report in the "trader trading blog"

S&P DOW Weekly 22nd March 2008

S&P Cash Weekly charts

New Quarter begins in just over 1 week, but there is more downside to come in 2008 with the lower levels, as shown in the charts above.

Resistance still remains around the Weekly cycle highs, which is the breakout of the Quarterly lows from 2007.

E-mini Daily charts

US markets have been range bound and consolidating in a downward sideways pattern for the past 2 months, as it trades between the Weekly channels.

Since the start of 2008, US markets haven't been able to trade and remain above the Weekly channels highs.

Those Weekly channel highs are shown above and the expectation remains that those highs are resistance.

However, with the start of the new quarter things might change and begin a gradual rise back towards the cycle highs @ 1388.

Note: I would like for this Month to complete and then use the April 50% level as a trend guide for next quarter. Therefore I'm looking for another week of sideways trading into the end of the month.

DOW Cash Weekly charts

April highs expected resistance with the expectation of further downside price action into the Yearly lows later this year...

DOW Daily futures

Weekly 'highs' resistance for another Week before using the April 50% level next month as a more robust trend guide if the DOW is going to continue into higher prices.

Note: As mentioned in last week's report, the week of contract expiry has a tendency to push upwards into the Expiry date. This played out, but I'm sure the FED cutting rates helped it along.

Please refer to the Daily report for full Daily analysis.

DOW S&P Weekly Report 15th March 2008

Monday is viewed as 'Support' with the expectation that any 2-3 day reversal upwards will be a short-term move before the market moves lower next week towards March lows...(Previous Weekly Report 8th March)

DOW Weekly and Daily charts

Last Week the US markets moved into a 2-day counter-trend move upwards into the 3-day highs, and then continued down on Friday, as it follows the overall trend of the breakout Quarterly lows, with the expected down move towards the March lows.

With Financial stocks taking a beating on Friday on the back 'Bear Sterns', the markets are expected to remain in a downward trend.

Only the FED stepping in on Friday to bail out the company stopped the markets falling further.

S&P Weekly and Daily charts

Both the DOW and S&P and pointing to much lower prices, this was confirmed with the breakout of the Quarterly lows last week, and the re-test of those lows and failure this week:- 2-day reversal upwards and failure.

At this stage I can't see any major UP move back into higher timeframe 50% level (Trailing resistance) until the next Quarter

DOW and E-mini Intra-day charts

The most robust pattern when trading the markets within the bigger picture is the 5-day patterns. These dynamic ranges are going to give traders the clearest picture, analysis, and RISK reward when day-trading intra-day trends.

And the Support level is ideal to be trading the movement within those cycles.

And with the break of Friday's support, the expectation is another push down into Monday's lows.

Note: March contract expires next week. Often when the week of contract expiry, there is a tendency for price to push higher into the date of expiry.

The movement and direction of the daily trend, along with 2-3 day swing patterns will be clearly defined by the Daily support levels.

Full Report in the Daily "the trader trading".....

DOW S&P Weekly 8th March 2008

DOW Weekly CASH Chart

Expectation of further weakness from April has come early with the break of the Weekly lows this week.

Overall down-trend is towards the Yearly lows:- with the Dilernia Principle of a 2-Year lower low Pattern expected into 2009.

And along with consolidating phases within each Quarterly and Monthly period....

"As the Weekly timeframe begins to 'tighten' and get smaller, there will be a breakout of the range, which will probably occur the closer it comes to the next contract expiry."

DOW Futures Weekly and Daily chart:- After a 4-day sideways pattern the break on Friday has confirmed that the market is moving down towards March lows, with once again the first support-target zone is the Weekly lows @ 11687....

And we had a high probability pattern to favour the down move continuing on Friday using the 2-day 'support' break from Thursday's highs.....(Chart Below)

DOW intra-day & 5-day ranges:- After 4 weeks of sideways price action in February, the down-trend began with the #2 break last Friday.

Over the previous 4 weeks, the 2nd support zone provided lows in the market, on that day it was the first time it didn't, and this resulted in the down-trend continuing.

And we can see the same pattern occurring: break of 'support' moves down into the 5-day lows, and continues down towards the next support zone in the next trading day:- Thursday into Friday.

The same will apply next week.....there is a breakout of the 5-day lows on Friday (expected resistance) with a push down into Monday's lows (support) using the 5-day 50% level as resistance.

S&P Weekly CASH

Break of Support and heading down towards the Yearly low......

Expected price action was to head down towards Yearly lows in the next Quarterly timeframe, but this has occured earlier with the break of the Weekly lows this week.

E-mini Daily:- 4-days of sideways price action, with the break of Support on Friday.....

Expected down move into the Weekly lows:- 1267 , and then down into March lows.

E-mini intraday and 5-day ranges:-

Once again the Break of #2 last Friday began the wave down.

This Week is following the same patterns of break of 'support' and moving down into next 'Support' , where once again short-covering came into the market but the short-covering was going to stall because of the 5-day lows.

This Friday the market was supported and Monday is viewed as 'Support' with the expectation that any 2-3 reversal upwards will be a short-term move before the market moves lower next week towards March lows...

Please read the Daily Report....

DOW S&P Weekly 1st March 2008

Global markets are consolidating around Quarterly support, and if there is going to be a next wave down it will come in the next Quarter or just after contract expiry in mid-March.

The current price action occurring now, which does seem like there's a strong ' support-base' building....however I can only make a forward conclusion by what I see, and I only view 'support' as being valid during this Quarterly timeframe which will disappear in April and project lower prices....

DOW Cash and DOW Futures Weekly charts

At this stage US markets are range bound and with 2-weeks before Contact expiry, if Price is still trading below March 50% level there is probably going to a 2nd wave down into the next Quarter when this current 'Support' disppears.....

As mentioned in the Daily report this week on the 27th, the Weekly cycles are a 'sell', and they have pushed the market back down as they did in December 2007, and until prices are able to close above the 3-weekly highs then we should continue to view the markets as heading lower in each Quarterly timeframe.

"As the Weekly timeframe begins to 'tighten' and get smaller, there will be a breakout of the range, which will probably occur the closer it comes to the next contract expiry."

DOW Daily

DOW Weekly ranges are getting tighter and we can see that for the next Wave down to occur there has to be a break of the Weekly lows. At this stage the Markets are still range bound between Weekly channels.

Friday's down-trending day has closed below the 3-day lows:- a change of the 3-day cycle and expectation is that price will swing upwards or consolidate for 2-days before the trend continues down.

The best Set-Up would be a rise UP towards March 50% level in the first few days next week hit the March 50% level and then move down into the Weekly lows.

Those Weekly lows are viewed as Support, but a break of these lows and the expectation is that price will begin to move down towards March lows....

DOW intra-day

The past few weeks on the DOW has been predictable in February:- it has been a consolidating monthly timeframe trading between Weekly channels, and when support failed in 1 day, the next day moved down into support and then rallied higher the next day.

On Thursday support had failed and the expectation was that price was moving down into Friday's support and the same pattern of a reversal up ('short-covering') . However 'support' had failed for the first time in many weeks, breaking the 5-day lows.

Therefore the expectation is the breakout of the 5-day lows on Friday, and price will try and push lower next week on Monday.

Normally the view is for price to rotate upwards:- lower Weekly open and break of the 3-day cycle would see a 2-day rotation upwards, but with Friday's breakout of the 5-day lows the expectation is to push lower on Monday into Weekly lows before any higher move or reversal pattern is going to play out.

S&P Weekly Cash and Futures

Same expectation is that market is currently supported around Quarterly lows, and with the expectation price is heading lower in the foreward timeframe.

Ideally I would like to see a test of the March 50% level before any major down-move.....

E-mini Daily chart

We can see back in the 1st January 2008 when the same pattern of the Weekly breakout occured and the move down into January lows.

And this is the same pattern that we need to see to verify any continuation down into March lows.

And the same could be said on March 50% level and the breakout of the Weekly highs, if for some reason the Week before contract expiry moves higher, as often happens. (Buying support into contract expiry)....


Next Week:-

Friday's breakout and expectation that a breakout of the 5-day lows and price will push lower on Monday....

Please read the daily report....

DOW S&P Weekly Report 23rd Feb 2008

Each Quarterly timeframe low will support price, and move back towards the Central levels on the higher timeframes...If there is going to be a 2nd wave of selling it will occur in the forward Quarterly timeframe, that being in the 2nd or 3rd Quarter.

Therefore for the next few months I'm looking for US and all global markets to move into a consolidation phase.....(Weekly Report 2nd February)


DOW Weekly Cash (left) DOW Weekly Futures (right)


Global markets are consolidating around Quarterly support, and if there is going to be a next wave down it will come in the next Quarter or just after contract expiry in mid-March.

The current price action occurring now, which does seem like there's a strong ' support-base' building, and could result in higher prices in the future, however I can only make a forward conclusion by what I see, and I only view 'support' as being valid during this Quarterly timeframe which will disappear in April and project lower prices....

DOW Daily futures

Until then the market is range bound and it's getting predictable on how price action is playing out.

Any time the market opens higher and near resistance levels they sell it down, and around the 5-day lows short-covering rallies occur. This price action won't last, but with 1 week remaining until the end of the month we should continue to expect the same.

As the Weekly timeframe begins to 'tighten' and get smaller, there will be a breakout of the range, which will probably occur the closer it comes to the next FED meeting..and contract expiry.

DOW intra-day

This week's trading provided some extremely robust trading set-ups each day. These types of markets are ideal for 'day-trading', because the 5-day levels play an important part, as price moves from the middle of the 5-day range outwards, and then back towards the middle of the range from outer channels

In trending markets or a trending Weekly 5-day period, you don't get as many high probability set-ups. This is obviously going to suit a certain style of trader compared to someone else, but by reading my daily blog I hope that it can suit everyone...

S&P Weekly Cash...

Exact same expectation as the DOW, and the exact same price action occurring......

E-mini Daily and intra-day

Last Week's high probability pattern was a rise upwards on Monday and then look for a down day on Tuesday defined by the Weekly 50% level.

When there was a large UP day on Wednesday, which occurred from lower support (5-day lows) the rest of the trading week moved into a sideways pattern resulting in some good set-ups....

Next Week:- I don't have an overall view of where the market is going or how it's going to play out, other than using the intra-day levels once again, and using regressive trading set-ups daily.

In conclusion:- Quarterly support and range bound, and with the Weekly timeframes begining to tighten there will be a breakout of this 4 week range shortly, probably timed with the start of the new month.

And for day-traders we simply look for the same patterns:- Sell higher opens and look for 'short-covering' rallies from support in the 2nd half of the day until the breakout occurs...

Please read the Daily reports......

DOW S&P Weekly Report 17th Feb 2008

DOW:

Weekly charts:- DOW futures on the left and DOW Cash on the right.

Range bound between Quarterly Support and Resistance from the breakout of the previous Quarterly lows, and the current view is further weakness in the forward quarter in April if price isn't able to close above the 3-week cycle highs @ 12703.

We subscribe to support being valid (BUY) and the resistance being valid (SELL), but eventually one is going to fail:- reverse the down-trend and move higher or continue with the down-trend into lower lows defined by higher timeframe analysis.

Daily chart:- DOW futures

Last Week's high probability pattern was simply using the Weekly 50% level:- above and it was moving back towards the 3-day highs, and above that price was moving towards the 5-day highs.

This price action was supported not only by the Weekly 50% level, but also by Quarterly support and a 'lower' weekly open (bottom-to-top)

Next Week's probability pattern is going to be the same, the Weekly 50% level @12399 is going to be the trend guide, as price remains between range-bound between Support and Resistance.

After last week's Price-pattern of a 2-day reversal down on Thursday and Friday, I favour an UP move on Monday towards the Weekly highs and resistance once again....

Intra-day chart:- DOW futures

Last Week's trading was 'text book' patterns:- 3 days up and probability of a 2-day reversal down from highs on Thursday was another probability pattern, but the important levels in confirming all the moves were the previous 5-day ranges.

Wednesday's UP move was confirmed by Tuesday's 5-day high. Thursday's reversal was confirmed by Wednesday's 5-day high. Friday's down move was confirmed by Thursday's 5-day 50% level...

And Monday's UP move next week is going to be confirmed by the 5-day 50% level (support)

Above support and the expectation is price is heading towards the 5-day highs.

Range bar chart:- DOW Futures

When we further analyse the Primary ranges (144) on the DOW, we can see that price is supported from Friday's level @ 12294, and the expectation is that price should move upwards 144 points to 12421....

Currently price is trading below the 3-day 50% level@ 12402 and below next Week's 50% level @ 12399, which is a short-term bearish pattern, therefore it needs to complete the 144 range upwards to confirm price is back above both those levels. Once it is above that the expectation is the market is moving UP towards the 5-day highs.

A bearish pattern would be:- 144 points upwards and swings back down below both those levels breaking support... or trading below support

Weekly Chart:- S&P CASH

Range bound between Support and Resistance, and until price can close above the 3-week cycle highs (on Friday), then the trend remains down and expectation it will follow the April range lower.

Weekly and Daily charts:- E-mini Futures

Exact same pattern last Week:- Quarterly support, lower Weekly open and rising upwards from the Weekly 50% level.

Next Week's high probability pattern:- 2 -day reversal and expectation of the 3rd day rising using the Weekly 50% level @ 1354 as a trend guide.

Note: Monday will start a brand new Weekly timeframe and the expectation is that price is rising towards the 5-day highs but also major resistance. Resistance is valid until it's broken and there is the potential of that occurring.

However a bearish pattern would be an UP move on Monday, but a sell-off from a higher Tuesday open. If this occurs and breaks the Weekly 50% level on Tuesday then the expectation is a major move down into the Weekly lows @ 1315

E-mini intraday chart

Support:- Monday's Up move should be verified by Price rising upwards from 1347.

E-mini Range bar (Primary Range R14)

Expectation that the UP trend should continue towards the 5-day highs.


In Conclusion:-

The Analytical view of the market is valid until proven wrong or it changes.

The Analytical view of the market is range bound between Quarterly Support and Resistance until it's broken.

The Short-term view of the market has been modelled to move higher on Monday towards the 5-day highs, this is valid unless price is trading below 'support'.

A Monday that rises higher has a random length:- it might reach the 5-day highs or it might not, but it's not a 'shorting' day whilst trading above the Weekly 50% level

A Monday that rises higher is the start of a new Trading week with the potential that price could continue higher each day:- But that's not my Analytical view because of Quarterly resistance.

A 'shorting' day will be valid around higher timeframe resistance and a higher open on Tuesday, but that will need to be confirmed by price moving back under the Weekly 50% level. If that price action occurs then my Analytical view is price is moving back down into Weekly lows, and at a much faster rate than many would expect....

That entire walk-forward scenario is valid and can play out precisely until proven wrong, and that is simply going to be defined by price trading on the either side of dynamic timeframe levels (50%) and support/resistance....

"those who anticipate best will prosper"

Please Refer to the Daily Reports......