Selfie Wednesday, page-14

SPI200 Commentary

Follow or Fade!

SPI was sold off heavily Tuesday as it was sold off from morning till afternoon. Evening session saw the selling continue and closed near the lows this morning. It seems that the downgrading of banks was one of the catalysts for the sell off yesterday but to me the selling wasn't as severe as we had in the last few weeks. Another catalyst could be the government changing their energy policy and now dictating where producers can sell their gas. This could have a long term effect on foreign investment as Energy companies dont like spending billions on infrastructure only to be told where to sell their wares. Overnight the miners were sold off heavily on the ADRs so that is another reason the SPI was so weak. On the downside there was big support on the XJO around the 5680 level, so if the momentum drives us lower that is the most obvious target for today. If there is some buying the most recent support on the XJO was around the 5750/5740 area so that will most likely be the resistance. So I think that is the likely range and with momentum to the downside I think its best to wait for failed rallies to short. For todays trading I am looking to buy 5630 and sell rallies around 5680