Market Analysis
At this point, the actual market activity has been mostly in line with the cycle projections. Below, we see that the daily S&P has traced out a rising wedge from which it has begun to break down. A divergence between price and momentum can be detected. But the cycles still point up, so there has been little follow through on the downside.
The daily S&P surpassed both the critical 38% and 50% retracement levels. Price sits just above the ‘last stop’ 78.6% and 81% retracement levels. A run at the old highs is likely by mid-month.
Daily S&P 500
Below are weekly and monthly oscillators of advances less declines. Both are overbought.
Weekly NYSE Advances Less Declines (10-Period M.A.)
Monthly NYSE Advances Less Declines (10-Period M.A.)
The weekly chart is now overbought.
Weekly S&P 500
The monthly graph shows that the decline has hit the 23.6% retracement levels of 1 prior rally and the 38.2% retracement of another rally. The longer-term support and the projected lows are in the 1550-1600 range by the autumn.
This is an excerpt from the monthly Cycles Research Early Warning Service, a monthly e-mail report that analyzes the trends in the US stock market, the bond market, and the gold market. There are stock and ETF recommendations and high-probability S&P turning points.
Cycles Research Investments, LLC does not guarantee the accuracy and completeness of this report, nor is any liability assumed for any loss that may result from reliance by any person upon such information. The information and opinions contained herein are subject to change without notice and are for general information only. The data used for this report is from sources deemed to be reliable, but is not guaranteed for accuracy. Past performance is not a guide or guarantee of future performance. The information contained in this report may not be published, broadcast, re-written, or otherwise distributed without prior written consent.
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