Australian Index: XJO
November 50% level push down into November’s lows, with the expectation of a 2nd wave down into December’s lows.
However, November’s lows haven’t held, which coincided with Resource stocks breaking their 4th Quarter lows on Wednesday, along with US markets moving down into their November lows the following day.
http://usindexweekly.blogspot.com/
Therefore I would look for a similar pattern as the October breakout, where price will probably swing back to retest the November low breakout @ 3584 sometime next week, and then more than likely continue down into the double low pattern in December.
SPI Monthly and Weekly
Last Week I was looking for a down move on Monday and Tuesday to complete the November low pattern, and then from Wednesday to begin a swing back towards the Weekly 50% level, before the market continued down.
Except on Wednesday Resource stocks broke lower on the day they lift the 'short-ban' driving the market lower, and US markets were still much higher as they were moving down into their November lows:- Dilernia Model
However, I expected Resource stocks along with Financial stocks to continue lower this month, and slightly lower in December also.
Next Week:- October low breakout 3548, and expectation price will remain below this level for next week.
Personally I would like to see Monday and Tuesday next week continue the drive down into lower prices towards next Week's lows, and then see how Wednesday opens.
If Wednesday opens above Tuesday’s lows, we will probably see a short-term 3-day move back towards 3584.
If you notice the breakouts in multiple timeframes, price comes back and retests the breakout and then continues with the trend, which is what has been happening throughout this year.
A close below 3584 in November, will probably see lower prices in December.
What's going to push the market higher is Financials, and banking stocks aren't ready for any moves higher other than short-term 3 to 5 day up moves.
December's lows complete the double Monthly low pattern, which can provide a relief rally similar to when the double Monthly lows pattern occurred in March 2008.
And in late December or early January begin a major swing back towards the Yearly breakouts @ 4232
And the same pattern of a retest of the yearly breakout of 2008 :- 4232.
Which hopefully occurs in the first Quarter in 2009.
Therefore it can bottom out in December’s-January’s lows, and then swing back to reset of the yearly breakout. Which will take about 2-3 months to complete the move back.
After that move, I wouldn’t touch stocks because price will mostly come back towards to the previous lows over the following 3-6 months and continue lower in 2009.
As a new Primary timeframe begins, and probably move into lower lows in 2009.
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