SPI Monthly and Weekly
As noted in last week’s report, the market remains in an orderly upward trend unless the market is trading below 4881-3
This changed last Monday when it was superseded with the breakout of the 5-day lows @ 4894.
The reversal of the trend was back into trailing weekly support levels @ 4767, which were only verified once the S&P followed the same pattern, and found support @ 1295, resulting in the SPI moving up on Friday.
Looking at the bigger picture:- we have an 2-month wave pattern that has reversed down from the February highs and back into trailing support levels, during the first Quarterly cycle in 2011
Those Weekly support levels have held, and the market is now moving into a short-term counter-trend move upwards, as the next month is about to begin (MARCH)
If the market is going to continue higher, then it will obviously follow the monthly range in MARCH and push upwards once again, using next week’s 50% level @ 4844 as a trend guide.
There are two possible patterns over the next 5-days…
#1 remains orderly, and continues towards next Week’s highs, as part of a move towards the MARCH highs
#2 moves back towards the original breakout @ 4881-83, stalls and then starts trading below the Weekly 50% level once again, as March begins
If that happens then there is the potential for more weakness if the market begins trading below the monthly 50% level in MARCH.
We should all keep an eye on how the S&P 500 trades over the next 2-days, as this could help set-up the overall trend over the next few weeks.
Read US market report.
