SPI  06295 H6310 L6341 C6278
DM + DI21 –DI 28 ADX 17 M/as 3/6255 5/6293 15/6307 30/6321

ASX 200 O62714 H62931 L62435 C62749
DM+DI19 –DI29 ADX 20    M/as  3/6241 5/6278 15/6298 30/6308

Another incredible week of volatility with most of the action on the downside. Last weeks commentary outlined the retracement levels and the time frames to Note – 12.30 pm 25/6 which brought in a low 6313 which was also the 30 day m/a and 144 10.30 am. 28/6 – a reversal from the weeks low 6184 27/6 which had closed on the range low.   This is surely a market to monitor with Gann Squares of 108 and 144 and both Gann and Fibonacci retracement levels.  This Information for the week ahead should go on your charts.  Serious SPI traders should keep a manual chart on the ASX 200 Index and a 2 pt. P&F – the results will amaze you.  The MARKET ANALYST software using Directional Movement, Parabolic Stop, harmonic moving averages 5/15/30 on a 5 minute time frame gives superb signals along with the candlesticks.   The dangers present for all SPI traders are reflected in the daily charts – the current chart shown for trading part Thursday and Friday serves to illustrate the importance of knowing where you are in time and price and where the support might come in. 

I have found the study of the magic of Gann and ASX 200 Index absolutely fascinating.  There are times when geometric angles are positioned in time and price at the mid-point of a range of the 108 square and Friday was a perfect example.  The range high 6403 20/6 – low 6184 = 219 points (2x108=216).  50% retracement 6184 – 6293 (109 points).  SPI futures traded up to 6310 into the 3 pm time frame and promptly sold off to 6241 – the low of day’s range and then rallying to 6283 by 4.30 pm. with close at 6278.    The index traded down to day’s range low 6243.5 and then jumped to 6274.9 for close.  The 3 day m/a 6242 and 45 degree angle off 6184 low 6236. Sycom on Friday night traded up to 6304 with session low 6245 (support) and close 6285.  A painful experience if you went short into Friday’s late sell off.  The $64 question now is where futures will open on Monday – a possible inside range day could provide an opportunity to close out.  The published MA chart shows the drama of the late sell off – those big red candlesticks into the low and the next five minute blue bar with higher low to prompt the big rally.  Note the crossover of the ADX from 60 below the Parabolic Stop signaling the end of the trend to take profits on longs.   Note also the price coming below the 5 period m/a at 6303 and then above at 6260 after the low. 

The  2 pt P&F chart on SPI  broke the downtrend from 6310 high at 6250.  A trendline on opening 6256.  P&F for both 1 pt and 2 pt scales provides great information on the openings and closings of this market and well worth the effort. MAs candlesticks complimentary for direction pointers both ways. Actually doing P&F charts will add to your plotting skills.  For example the opening band of trading on Friday on the 2 pt chart gave a perfect target of 6258 – broke the downtrend at 6270 before the run up to 6310 the day’s and midpoint resistance.    A scan of the hand drawn P&F on ASX 200 Index with overlay of 108 square shows it into the mid-point area 6292 (6184-6192 = 108 pts) in filling 54 boxes on the horizontal axis.  It further shows the range low getting support on Gann Angle off low emphasizing the importance of the 6244 support.

What happened last week is always clearer with hindsight but it is important for SPI traders to have the information to hand which will assist in pulling the trigger to get in and out of positions profitably.  Panic selling towards lows a dangerous practice for new shorts as we have seen since the low of 13/6 and again 28/6.  It is not the purpose of this chart commentary to make predictions but rather to give the technical probabilities for the week ahead and to emphasise the importance of using MA software to best advantage as the bigger picture unfolds in the market.

Last weeks chart on ASX 200 from 20/6 hi  shows the progression of lower highsinto 23/6 with 6313 low getting support on 30 m/a and then rallying but with 26/6 failing to take out  6356 highs and the downward trend getting underway on 27/6 which proved to be a panic day.  The Gann 2/3 retracement, Fibonacci 61.8% taken out like a hot knife through butter resulting in the panic sell off to 6184 low marginally above the  6170 low of 13/6.  The close at the low yet another type of bull trap for the futures players with Sycom range H6264 L6192 C6258 providing yet another nasty experience for shorts on the lows.

Note the well defined downtrendline from 6312 and the breaking of the various Gann angles – the most important one the 45 degree on 22/6.  Range retracements should always be calculated – rule of thumb it 61.8% goes then 78.6% -market will go lower and it did before buyers came in at 6184  (range 6403/6184= 219pts.) A Gann square of 108 to perfection give or take 1 or 2 points.  Futures knew where the cash support would come in and made low precisely at this level.  Likewise Friday’s low 6241.

THE WEEK AHEAD:  To profit from the probabilities offered by using Gann with the 108/144 vibrations, the range retracements generally respected by the market should be noted on your notes along with the time retracement levels and the various angles and the significant support and resistance levels best  seen on P&F charts.  The 6170/6184 support now significant in big picture.   Resistance at 6409/6403 needs to be taken out which would suggest new all time highs again.  Wall Street influence not to be ignored.

Range Retracements: 6403/6184 = 219 points 1/3=6255 .382=6268 50%=6294
                                           2/3=6330 61.8=6319 78.6=6356
Once significant lows are made Gann angles can be placed on low or bottom of Square and they become fixed angles and where the 45 degree on half hourly charts Becomes very important.  Rule of thumb when angle breaks, target becomes the angle Below.  Now the market is potentially in uptrend again, the angles and times can be viewed on both the 108 and 144 squares.

108 Square – low 6184 27/6 – 1/3 = 3.15 pm  2/7, Midpoint 11 am 4/7, 2/3 1.30 pm  5/7,
                                                  3/4 =11.30 am 6/7, 7/8 = 11.30 am  9/7,  108 12 pm 10/7
2/3 price-2/3 time and 45 degree angle 1.30 pm 4/7 – price level 6328

144 Square – low 6184  with position of 45 degree angle:- 1/3=2.30 pm 3/7 (6280)
Mid-point =1.30 pm 5/7 (6328) 2/3 =12.30pm 9/7 (6376), 108=12.0 pm 10/7 (6376)
7/8= 2.30 pm 12/7 13/7 (6474) = Square of price and time.

Gann Resistance Angles off 6403 high:     Open    Close     Open  Close     Open  Close
                                                   2/7  (1)     6354    6348   (2) 6343  6338  (3) 6303  6292
                                                   3/7  (2)     6346   6341    (3) 6290  6279  (4) 6277  6279

Gann Support Angles off 6403   2/7  (A)     6239    6261   (B)  6225 6241  (C) 6211  6222
                                                   3/7           6262    6285         6244 6260        6224  6235

Focus for trading on 2/7 would be on 45 degree holding at which level is approx 50% Retracement off range off low 6184/high 6293.  Support low 6234 28/6.  In uptrends watch for progression of higher lows.  Fridays rally after 6249 correction was a good example but the 50% of the range the key to the days high and where the big profit taking correction got underway.  It also broke a steep Gann angle off 6184 low.  Mondays can be difficult days to assess but Tuesday is usually a good one.  The 1/3rd time off 108 square 3 pm and combines with 3.30 pm 108 off 6403 high as an important time. Gann favoured 1/3rd and 2/3rd levels in both price and price and time important.  When They combine with a 45 degree angle line can be good set ups.  Looking at current square 2/3 rd  time and 2/3 rd price and 45 degree angle 1.30 pm Thursday 6328 -  2.0 pm 144 time drom 6403 high. It is important to look at clusters in time. There is exquisite geometry to be seen within Gann Squares.

Moving averages also play a big part with the analysis especially the 3/5 day.