SPI Monthly and Weekly chartsThe trend is down and the expectation is that the Trend will continue lower in 2009.
Currently I have the view that global markets are moving lower into December's lows and complete the double monthly low pattern before a potential reversal upwards.
However, I've always maintained that for any trend to continue lower in 2009 price needs to swing back upwards and move back towards the 3rd Quarter breakouts (September).
This will result in the retesting of the 2008 Yearly timeframe lows verifying the breakout, and then continue lower in 2009.
Once that UP move occurs, my view is that breakout level will form a resistance zone and markets will be moving lower in 2009.
But things get extremely interesting next week in all Global Indexes and currencies...
The important part on any trend continuating lower, or even any major trend reversal begins with the break of the 3-week channels, in this instance the 3-week highs
Any long term trend won't change unless there is a breakout above the 3-week highs, and then continues above the Monthly 50% level.
This normally occurs with a Friday close above the Weekly highs, and the following week continues higher.
Any continuation of the long term trend (down) normally occurs with price retesting the 3-week highs and then rejecting downward, as it continues with the trend towards the Monthly lows.
SPI Weekly and 5-day patternLast week's view was a higher Weekly open and a 2 day down move. That played out and then the next 3 day's consolidated within the 5-day range and the SPI Primary Range of 87 points.
Next Week:- I have the expectation that Global markets are moving towards the Weekly highs next week. http://usindexweekly.blogspot.com/
Around those Weekly highs and the view is resistance ( until broken with a Friday close above), with the expectation of a move down into December's lows to complete the 2-monthly timeframe pattern.
A breakout and Friday close above those Weekly highs, and my view is that markets are moving back towards higher Monthly close in December, as it goes looking to move back to re-test the Yearly breakout in early in 2009.
A breakout and Friday close above those Weekly highs, and my view is that markets are moving back towards higher Monthly close in December, as it goes looking to move back to re-test the Yearly breakout in early in 2009.
Therefore for any reversal upwards needs to see a Friday close above 3770.
The trend remains down and the expectation is that market's will continue down, but any reversal upwards in the medium term will begin with a breakout above those 3-week highs confirmed with a Friday close above them.
Those 3-week highs in all global Index markets are extremely valid resistance zones, and have been all year.
But eventually they will break, and markets will begin a rotation upwards as part of the larger timeframe cycles.
