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On Monday I forecast a significant decline after a surge to around 143.50 for SPY. Wednesday's morning spike took it to 142.86 before the decline began. On the weekly chart, both the cash S&P and SPY closed below the previous week low, confirming that the signaled weekly reversal had begun. However,two previous weekly reversals have not persisted in this strong bullish market so we must await more information on Monday to better determine the longer term outlook. Friday was a Near Impulse day and ordinarily it would signal an end to the daily decline, setting the stage for another up move however the weak close on Friday and other segments of the market suggest more downside to come. The next Near Impulse date is 1/11/07. If Monday results in lower lows, we can expect a continuation to that date
Jim White
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