Australian ASX 200 SPI futures look good if you're a bear

The picture for Australian ASX 200 SPI futures look good if you're a bear.

We've seen a bearish engulfing candle on Wednesday with follow-through selling today, accompanied by an uptick in volumes. Momentum indicators are providing bearish signals, too.

But it is month-end and the price does find itself sitting on the 50DMA, a level that has been respected consistently apart from a period between June and July this year.

Even though price and momentum signals suggest selling rallies may work better than buying dips in near-term, unless we see a close beneath the 50DMA, going short beforehand comes across as a low probability play given prior interactions with the level.

If the price closes and holds beneath the 50DMA, you could sell with a stop either above it or 8200 for protection. On the downside, 8080 is the first level of note, but to make the trade stack up from a risk-reward perspective, 7860 comes across as a more appropriate target.

Good luck!
DS