I must stress from the outset that the SPI remains in a strong uptrend since breaking the 4600 level last week. We should not fight this until we see a clear distribution process. This is either: i) A strong reversal candle out of a fibonacci level/clear resistance level ii) A double top pattern iii) A breakoutdown of a clear range
None of these scenarios have occured or been in place thus those looking to short need to wait for these signs.
The SPI has opened at 4802 and thus right into the previous breakdown range at the start of the month. The Cash index is now trading right into the 61.8 Fib retrace and a possible double top pattern is in play. The resistance levels today in the ASX200 are: 4763- Fridays highs 4765- 61.8 retrace off the high 4780- previous low prior to breakdown
These levels are approximatly 4800/4810 in the SPI.
Plan today: i) Look for a strong reversal candle out of the res zone to short with a very tight stop. Add below the open gap. ii) If there is no reversal in the first 30mins, look to buy breakouts from consolidation patterns/follow the moving averages. Supports at 4780 in the SPI need to hold to keep this scenario intact
