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LET?S LOOK AT THE FTSE 100 INDEX

After the initial 24 calendar day move up, that was almost vertical. The index has now moved down 33 calendar days and retraced only half the move up. Obviously this move down has been a struggle. But remember, the length of time of this move down changed the character of this fast trend up. The technical concern is; "was that fast move up an exhaustion of the bull campaign or is it now consolidating that fast move up so the trend can resume? You can see as indicated by the arrows - on three occasions price broke to new lows and there was no follow through. This should produce a low. If it doesn?t, if it starts to trade below this level. Then this could produce a handful of huge days down this week. Please, let me make this clear. The normal thing to see from this pattern is a low and a move up, due to the obvious struggling trend down. Similar to the December situation. But this is the time of truth for the intermediate term trend. Any further weakness could bring about a very scary spike down, this week.

LET?S LOOK AT THE S&P DAILY CHART

Unlike the previous moves down while this index has been trending upward. This move down is behaving like a trend. This move down started with a "false break" pattern. Fell down to the obvious support of the trendline, I indicated there would be a counter trend move up and the trend would resume down, the counter trend was only one day. Last week the index was down to the February low and the bounce was extremely weak. I reported there were cycles for lows this weekend. But cycles are probabilities, the reality is how the market is trading. The past two days of rally attempt could not even pull above the previous low, thus keeping this downtrend in a strong position within its trend. It still looks like a test of the January lows, what is marked as "obvious support." The type of move up from that level, will tell us the magnitude of this move down. The forecast I published in the first week in January indicated this move down would hold or just go marginally below the January level. Again, that was the probability, the reality is how this index is trading and up to today - it is trending down and that trend has remained strong. Remember, the normal counter trend for this index, when it is trending is one to four days, if this rally, which is now two days, can exceed four days it will give an indication of having found a low. But for now the fast trend down remains intact.