Danger
The STI climbed up in the first two trading days of the new year, but closed very weakly down today. If you look at the candlestick chart which is shown below, you will see that the candlesticks in these two days have formed what is known as a “dark cloud cover” pattern. The down candle today opened above the close of yesterday’s up candle and then closed below the midpoint of yesterday’s candle. This is a bearish reversal pattern, which means that the uptrend is reversing into a downtrend. If on Monday the STI continues lower, we would have what is known as “confirmation” of the downtrend.
Therefore I am retaining my prognosis of the wave count as shown in the top chart, with the STI forming Subwave c (brown) going downwards. As I write this at midnight on Friday, the Dow is down some 240 points. So it looks like we will get a confirmation of the downtrend on Monday.