Aussie Index (SPI) 26th June 2010 Weekly

SPI Monthly and Weekly

Last week's reversal pattern from the Weekly highs and back below the June 50% level @ 4519 normally follows the move down into the July lows. (3rd Quarter lows).

Next Week's 50% levels will be the trend guides.

The 3rd Quarter lows can support the Aussie market and then the trend moves into a 3-month sideways pattern (large consolidation pattern) between the 3-month lows and the 3-month 50% levels until October. (4th Quarter)

However, it will depend on the S&P 500 and whether a 3rd Quarter move continues down into the Yearly 50% level @ 969.

Aussie Index (SPI) 19th June 2010 Weekly

SPI Monthly and Weekly

Yearly 50% level Support @ 4295 and now this week has closed above the 3-Quarterly 50% level @ 4522 and has remained supported without selling down.

Based on the current patterns and also the price action in the S&P 500 (Read US Index report)....

The Australian market looks like following the Weekly ranges upwards next week and into July (2-weeks)

The market could continue to consolidate around the June 50% level for the next 2-weeks until the start of the 3-Quarter and a new 3-month cycle (new trading set-ups)...

But at this stage I would treat the Aussie market as following the Weekly ranges upwards, as long as it remains above 4519.

Note:- looking at the large cap stocks (BHP, RIO, and Banking stocks), there are no bullish patterns appearing as yet or 'buy' set-ups.

The Yearly 50% levels in the XJO and Miners are supporting the market along.

BUY set-ups may appear in the 3rd Quarter. (Read Stock Report)

Aussie Index (SPI) 12th June 2010 Weekly

SPI monthly and Weekly

Yearly 50% level @ 4296 continues to support the SPI and the market is trading back around the June 50% levels.

There are no leads from US markets that the trend is going to continue higher, as the 3-Week highs can send the S&P back down, or it keep in consolidating during June

At this stage I'm treating the Aussie market as consolidating in June (no Weekly close above the monthly 50% levels).

Last Week started from a lower Weekly open and a swing back towards the June 50% level

Next week starts from a higher Weekly open and trading around resistance levels.

Trend guide @ 4522.

Aussie Index (SPI) 5th June 2010 Weekly

SPI Monthly and Weekly

As pointed out in the previous Weekly reports, the price action below the MAY lows was bearish and there is a possible continuation down in June.

Whether it gets towards the June lows isn't a high probability pattern, as the Yearly 50% level @ 4295 can continue support the Australian Market.

I would have preferred to have seen Monday sell off from the June 50% level, than Monday opening lower, as the market can swing back upwards ( short-term counter-trend move)

The down trend is will be dictated by the price action in the S&P, and even though I'm bearish, the Australian market can continue to consolidate and swing around in the early part of June.

SPI Yearly and 3-Quarterly

We can see the Australian market sell from the 3-year 50% level and now trading around the single Yearly 50% level in 2010 @ 4296

This either going to have the Australian market move into a larger consolidating pattern until 2011, or it's going to continue down into the 2010 Yearly lows @ 3394 to 3061.

That will only happen if the S&P 500 continues down towards 969.

What do we notice about the SPI and the Yearly timeframe?

There is a breakout of the 2008 yearly lows but a failure to complete the move down into the 2009 lows.

The Australian Market was dragged upwards by the S&P 500, as those markets provided the Yearly swing low patterns in March 2009.

Therefore I have a feeling that the Yearly low pattern still needs to complete in 2010.

Therefore if I'm right, then around 3394 is the time to be moving back into the market and hold long term. It might dip lower to around 3061, but it won't spend much time below 3394.

We can verify using lesser timeframe (monthly) to time the market better, but I wouldn't be sweating on it.

I might be wrong and it doesn't get that low, but again it's too early to be moving into stocks just yet.

June lows might provide support in the early part of the month, but not so much in the last week of the 3rd month in the Quarter.

Aussie Index (SPI) 29th MAY 2010 Weekly

Weekly report written 15th August 2009....

"3d Quarter 'thrust' pattern into the 2009 Yearly 50% level has completed from the March lows.

Any further UP moves would need to align with the 4th Quarter 50% level,and continue up from the 4th quarter 50% level and into the highs, which aligns with the Yearly 2010 highs.

If that happens then price can push back down into the Yearly 50% level in 2010 and consolidate for a number of Quarters during next year and move into a long term sideways pattern until the 2nd half of 2010"




SPI Monthly and Weekly

9 months later and this pattern has played out precisely in the Australian market.

The Yearly 50% level in 2010 is supporting the market and we can now moved into a multi-sideways consolidation pattern.

In the short-term there is a breakout of the MAY lows, therefore there is an expectation that price will try and move downward in June using the 50% level as a trend guide next week.

Note:- Weekly timeframe remains in MAY until the end of next week.

However, what happens if the S&P 500 follows the same pattern and moves down into the 2010 50% level, that is 100 points lower or 1000 points in the DOW.

Some of the biggest sell offs occur in the last month of the Quarter as price begins the month at the 50% level.

Even though the Aussie market looks like it can consolidate, the worrying pattern is the S&P 500 and the current patterns that are occuring right at this moment.

What happens if the S&P follows last year's forecast...

That can put the Aussie market down around 3400 (Yearly lows) and probably the bottom of the cycle lows for 2010.

In conclusion:- It's too early to get comfortable with current support levels

Aussie Index (SPI) 21st MAY 2010 Weekly

SPI monthly and Weekly

After reading the US market report there is an expectation that US markets are moving up towards their June 50% levels.

If that is the case this is going to push the Australian Market upwards, however based on price trading below the 3-Quarterly 50% level this could see the SPI struggle to close above 4522 by the end of MAY.

Based on current patterns the trend guide next week is 4356 using the daily timeframe (sycom closed 4358).

If the SPI is trading below @ 4356 then the Aussie market is consolidating until the end of the month, as price remains below the MAY lows and the 3-quarterly 50% level.

If the SPI is trading below 4522 by the end of the month, then there is the expectation of a move lower in June:- break and extend pattern in the single month timeframe (red channels)

In conclusion:- the market remains in a breakout with a downward bias and any higher moves next week are seen a minor swing patterns and consolidation until June.

Aussie Index (SPI) 15th MAY 2010 Weekly

SPI Monthly and Weekly

MAY lows supporting the market, whilst the Weekly 50% level in the 24 hour market is supporting the market after the expected 2-day reversal on Thursday into a lower Friday close

As per previous Weekly report there is an expectation that price is heading towards the June lows, however the MAY lows and 3-Quarterly 50% level can continue to support the market until June.

Which means price can consolidate and move towards the June 50% level but then push down towards the June lows and the Yearly 50% level @ 4295.

Next Week's 50% level and lower Weekly open is the trend guide which can see the Aussie market move into a 2-3-day UP swing, as long as it remains above Weekly 50% level.