Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Consolidation Ahead

Stock-Markets / Stock Market 2021 Jun 01, 2021 - 12:18 PM GMT

By: Andre_Gratian


Current Position of the Market
SPX Long-term trend:  There is some evidence that we are still in the bull market which started in 2009 and which could continue into the first half of 2021 before major cycles take over, and it ends.  A move up to ~4500 is possible before the current bull market makes a final top and SPX corrects into its next major cycle low due in 2023.
SPX Intermediate trend:  Phase three (wave 5 from 3723) is now likely underway.
Analysis of the short-term trend is done daily with the help of hourly charts. They are important adjuncts to the analysis of daily and weekly charts which determine longer market trends.

Daily market analysis of the short-term trend is reserved for subscribers. If you would like to sign up for a FREE 2-week trial period of daily comments, please let me know at

Consolidation Ahead

Cycles:  Looking ahead!
7-yr cycle – Last lows: 2009-2016.  Next low: ~2023

Market Analysis (Charts, courtesy of QCharts)

IWM - SPX (weekly)
Structurally, IWM appears to run a little ahead of SPX.  Starting from the March low, IWM has already completed three waves up, while SPX is still in the final stages of doing so.  This is the reason for the “early warning” which is regularly given by IWM.  It is therefore likely that IWM will remain in a warning mode until SPX has completed wave 3, which may still be a couple of weeks away 

SPX daily chart
At the daily level, SPX is showing the deceleration pattern which precedes a minor top.  During the past two days, the index crawled to a fractional new high, but each day failed to retain its daily gain and pulled back at the end of the day.  This is better illustrated on the hourly chart which we will analyze next. 
This deceleration is caused by the imminent bottoming of an ~18-wk cycle expected to make its low next week. The index appears to have reached the end of 1 of 5, and the cycle would ideally bring about wave 2 of 5 since the amount of distribution established last week is not very substantial and the minor correction may not exceed the 4130 level.     
With the rally from the 4061 low, the oscillators have fully recovered from their negative readings and are strongly positive.  They are expected to remain positive while wave 5 from 3723 continues to unfold, and will warn us that it is about to end when negative divergence appears in the CCI.

SPX hourly chart
The SPX hourly chart provides a detailed, close-up view of its current structure, with wave 3 from 3723 having completed at 4238, and wave 4 also complete after making an a-b-c pattern down to 4061 before starting on wave 5. 
After the index had made a return move to 4213 by last Monday, the following action was a little murky since the expectation was that wave 1 of 5 had topped after reaching its ~4210 target and that wave 2 should now be causing a retracement; but the index refused to correct right away and instead made a little topping pattern which probably completed at Friday’s close.  If so, it would suggest that Tuesday morning should continue the expected pull-back into wave 2 with the assistance of the bottoming 18-wk cycle. 
We can only speculate beforehand on the impact that cycles and structure will have on the market, so let us see if we get the anticipated market action over the next week or so.  Also remaining to be proven will be the P&F projection which calls for wave 5 of 5 to top at 4310+

  • GDX (gold miners)-(dly)
  • If GDX can consolidate a little longer without going below 38, it could extend its rally to about 43. 
  • PAAS (Pan American Silver Corp-(dly)
  • PAAS also needs to consolidate a little longer without showing real weakness if it wants to reach 40 on its next move.  What GDX does will affect PAAS in a similar manner.
  • BNO (Brent oil fund) wkly
  • The weekly chart of BNO gives us a better appreciation of its price pattern.  The past 10 weeks have moved in a crawling uptrend which has barely exceeded the previous high.  The index is also struggling in an area of overhead resistance which will not be overcome with this kind of action.  The odds rather favor a pullback to the previous short-term support where a decision will be made about the future trend. 
  • UUP (dollar ETF) (wkly) ($USD chart is not available from this data provider)
  • UUP appears to want to hold at previous support or just a little lower.  Some good positive divergence is building in the CCI, but it still needs to do a lot of work to reverse its downtrend.  After breaking its 50-dma at a much higher level, it did manage to rally back up to it, but was immediately repelled.  It does not look as if much strength will be forthcoming unless it can overcome that MA. 
  • Best guesstimate is that SPX has completed wave 1 of 5 from 3723 and that it is ready to embark on wave 2.  This will have to be confirmed by next week’s action.  Until proven otherwise, the index could still reach about 4310+ upon completion of wave 5.


Free trial subscription

With a trial subscription, you will have access to the same information that is given to paid subscribers, but for a limited time-period.   Over the years, I have developed an expertise in P&F charting (price projection), cycles (timing), EWT (structure), and general technical analysis which enables me to warn subscribers of pending reversals in market trends and how far that trend can potentially carry.  For a FREE 2-week trial, subscription options and payment plans, I encourage you to visit my website at

Disclaimer - The above comments about the financial markets are based purely on what I consider to be sound technical analysis principles uncompromised by fundamental considerations. They represent my own opinion and are not meant to be construed as trading or investment advice, but are offered as an analytical point of view which might be of interest to those who follow stock market cycles and technical analysis.

Andre Gratian Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in