Australian Stock Market SPI Futures 29th October 2014

SPI Primary & Secondary Cycles

 

My view of 5399 stalling the market (Sell Zone) failed with last Friday's close above that level.

 

Two important patterns have occurred since the market reaching the 2014 Primary highs..

 

1:- Reversal down into the 2014 50% level and October lows (Support)

 

2:- Last week's close above 5399.

 

This suggests the overall Primary Trend remains bullish, along with 5399 now being a random support zone, and that the trend will likely continue up towards the 2015 highs.

 

The most robust pattern of the trend continuing higher is for the Trailing support (currently 5139) rising upwards and forming a higher Support zone in December, providing the next thrust pattern.

Australian Stock Market Weekly Report 19th October 2014

Trend bias is to complete the Primary cycles based on the Dilernia Principle of Break & Extend towards the 2014 highs. As we can see, the change in cycle saw support come into the market @ 5266, whilst within the Monthly cycles there is another break & extend pattern that suggests the minimum move will be towards the April highs. (March 50% level Support) My view remains, off load Margin long positions around those Yearly highs

Previous Weekly Report

Australia Stock Market :- Primary & Secondary Cycles

The Market has played out as expected, completing the Primary Cycles towards the 2014 highs, and hopefully traders took my recommendation to exit Long Margin Positions around those upper levels.

When we look at the shorter cycles within the Weekly timeframe, we can see a similar break and extend pattern on the downside, from the September lows & now into the October lows. This medium term support coincides with the 2014 Yearly 50% level.

At this stage in the game, the secondary cycles are likely to form resistance around 5399 (SELL ZONE), and with just over 2-months to go until the end of this Primary cycle, it’s way too early to have a long term view of the overall market trend.

My view is that the Market could consolidate within a narrow band of the Sell Zone, and short-term Support until the next Primary cycle begins in 2015.