The Australian Market (XJO) is consolidating around the January-March Quarterly lows, and my expectation that price will remain range bound between these lows and January 6040 until the end of March....And will probably move back towards the Yearly balance point @ 6213- 6328 the closer it comes to the end of the March contract (Expiry), and then April Highs in the forward Quarter.
Last Week's report was based on the Quarterly lows supporting price, but the first expectation was that price had to come down early in the Week to close the Gap, and test the 3-day lows before any Up trend could continue....
Whenever the market is trading around the middle of the timeframe, the expectation is that price is moving towards the outer channels, regardless of which timeframe it is..
When the SPI opens next week, Price will be opening in the middle of the monthly 50% level, therefore the expectation that price needs to move away from the middle and push outwards...
3-month breakout of January lows @ 6040 is first resistance....
When we look at the 5-day pattern, the Market will open on Monday around the Higher channel, the expectation is that price needs to rotate back down towards the middle of the range before any upward move next week can take place. Even though the expectation that price is moving higher in February, my expectation is that price will move back down first before any UP move occurs.
On Monday the SPI is going to open around 5960, this places the SPI above the February 50% level @ 5896, and using the lows of January ‘breakout’ (Resistance 5962) we are looking to trade the SPI down on Monday back into 5896, and any short-term weakness in the SPI and expectation price will move towards the middle of the past 5-day range over the next few days. (2-day reversal at the start of the Week)
Looking at the market Dynamics using a number of different timeframes, the Aussie Market looks like it will move into a sideways choppy pattern with no clear direction throughout February.
The Volatility will soon drop and the Daily Ranges will decrease and we move into regressive trading:- selling higher opens and Buying lower opens. The trending periods within the Weekly timeframes that we have recently seen will make way for consolidation and back to normality. (smaller Ranges)
Thursday's trading last week had over 850 points of range volatility within 1 single day. That is something I haven't seen before, and it will probably be a long time before I see the same thing again.
Friday's Trading was exactly like the Friday before, rising upwards from the Dilernia Pivot and making it's way towards the 5-day Range high, with more Buyer appearing from an R44 spiral bottom around 14:36....
Last week we traded the market down in the first two days from the 5-day highs, and I'll be looking to do the same again next week, back towards the 5-day 50% level @ 5755, along with using spiral tops to trade down.
Please Refer to the Daily report...
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