Breakout of June's lows @ 5100, can send the market down into 4836 before any reversal pattern back towards July's 50% level occurs.
Therefore the first two days of trading next week should give traders a fair idea on how the market is going to play out, because if the trend is going to continue down, it will normally occur after a 2-day 'stalling' pattern."
Previously Weekly Report
SPI Weekly chart
SPI has continued down from 5100 and the breakout towards 4836.
Once the July lows are reached next week, my expectation is price is going to swing back towards the 3-week highs, but that needs to be confirmed with similar price action in the US markets.
http://www.usindexweekly.blogspot.com/
SPI Daily
Last Week the SPI remained in a tight 5-day pattern around the Weekly lows 4929, and next Week's lows @ 4844 match my overall view of the down move into 4836 in July.
Note: A rotation UP towards the Monthly 50% level, but it could take a number of weeks to move back towards the Monthly 50% level in August.
What that basically means is that, I'm not expecting a major counter-trend move UP like what occurred in March this Year, my view is support forming around 4836 and remaining range bound below 5100 until the end of July, and if there is going to be a 'pop' upwards into the monthly 50% level, then there is more of a chance that higher prices would occur from August.
After a rotation into the Monthly 50% level, my view remains that the Aussie market is heading down into the Yearly lows @ 4538-82, which will be helped by Resource stocks namely BHP.
Any UP move in the next few weeks is only viewed as short-term, with the expectation of lower prices in 2008.
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