Last week I was suspecting that S&P/ASX 200 may test 3850–3900 level where as it bounced back from 3985 level but as we all know that every pattern may not react 100%.
It is getting some resistance around 4122 level and if S&P/ASX 200 does not break this level in coming days then I will think differently because it is making lower lows. Though it is in early stage but if it drops more than 3985 then it may be making a bearish trend.
On the other side if it does not drop below 3985 then it will be making a very short-term positive pattern which can take it around 4250 level but for that it needs to break the 4122 level which it failed to break during last few weeks. Here I must say that 4162 is its 38.2% retracement level considering its May top.
So 3985 is the level that needs to be watched and for any kind of upside break-out, the level is around 4122.
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