Most Popular
1. THE INFLATION MONSTER is Forecasting RECESSION - Nadeem_Walayat
2.Why APPLE Could CRASH the Stock Market! - Nadeem_Walayat
3.The Stocks Stealth BEAR Market - Nadeem_Walayat
4.Inflation, Commodities and Interest Rates : Paradigm Shifts in Macrotrends - Rambus_Chartology
5.Stock Market in the Eye of the Storm, Visualising AI Tech Stocks Buying Levels - Nadeem_Walayat
6.AI Tech Stocks Earnings BloodBath Buying Opportunity - Nadeem_Walayat
7.PPT HALTS STOCK MARKET CRASH ahead of Fed May Interest Rate Hike Meeting - Nadeem_Walayat
8.50 Small Cap Growth Stocks Analysis to CAPITALISE on the Stock Market Inflation -Nadeem_Walayat
9.WE HAVE NO CHOICE BUT TO INVEST IN STOCKS AND HOUSING MARKET - Nadeem_Walayat
10.Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - Nadeem_Walayat
Last 7 days
The NEXT BIG EMPIRE WILL BE..... CANZUK - 25th June 22
Who (or What) Is Really in Charge of Bitcoin's Price Swings? - 25th June 22
Crude Oil Price Forecast - Trend Breaks Downward – Rejecting The $120 Level - 25th June 22
Everyone and their Grandma is Expecting a Big Stocks Bear Market Rally - 23rd June 22
The Fed’s Hawkish Bite Left Its Mark on the S&P 500 Stocks - 23rd June 22
No Dodging the Stock Market Bullet - 23rd June 22
How To Set Up A Business To Better Manage In The Free Market - 23rd June 22
Why Are Precious Metals Considered A Good Investment? Find Out Here - 23rd June 22
UK House Prices and the Inflation Mega-trend - 22nd June 22
Sportsbook Betting Reviews: How to Choose a Sportsbook- 22nd June 22
Looking to buy Cannabis Stocks? - 22nd June 22
UK House Prices Momentum Forecast - 21st June 22
The Fed is Incompetent - Beware the Dancing Market Puppet - 21st June 22
US Economy Headed for a Hard Landing - 21st June 22
How to Invest in EU - New Opportunities Uncovered - 21st June 22
How To Protect Your Assets During Inflation - 21st June 22
AI Tech Stocks Current State, Is AMAZON a Dying Tech Giant? - 20th June 22
Gold/Gold miners fundamental checkup - 20th June 22
Personal Finance Tips: How To Get Out Of A Tough Financial Situation - 20th June 22
UK House Prices Relative to GDP Growth - 19th June 22
Will Global Markets Be Pushed Deeper Into Crisis Event By The US Fed? - 19th June 22
Useful Things You Need To Know About Tweezer Top Candlestick Pattern - 19th June 22
UK House Prices Real Terms Sustainable Trend - 17th June 22
Why I’m buying the “new” value stocks… - 17th June 22
Optimize Benefits from R&D in Software Product Development with an R&D Tax Credit Software - 17th June 22
Want To Save On Your Business Energy? Here Are Some Helpful Tips - 17th June 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Minor Cycle Correcting

Stock-Markets / Stock Market 2021 Nov 16, 2021 - 05:02 PM GMT

By: Andre_Gratian

Stock-Markets

Current Position of the Market

SPX Long-term trend:  The long-term trend continues unimpeded but could be challenged in early 2022. 

SPX Intermediate trend:  An intermediate correction has ended and given way to another intermediate uptrend which could continue into early 2022.

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 agratianj@gmail.com

 

Minor Cycle Correcting

Cycles:  Looking ahead!

7-yr cycle – Last lows: 2009-2016.  Next low:  ~2023

Market Analysis (Charts, courtesy of StockCharts)

SPX daily chart

A couple of weeks ago some deceleration was beginning to take place in the index due to some technical and cyclical factors, and this was being reflected in the indicators as we approached the FOMC meeting suggesting that the market might react negatively to its report.  Instead of correcting immediately, the index liked what it heard from the Fed and from the jobs report which followed a few days later, and it tacked on close to another 100 points before starting to pull back.   Only then was it able to start the anticipated correction, shaving off about 90 points in the early part of last week before finding support and rallying into Friday’s close. 

The decline which began at 4718 is likely to be a correction brought about by the current short-term cycle due to make its low on about 11/22.  The rally which started from 4630 on Wednesday is probably a countertrend move which had an estimated projection to ~4685.  This was achieved on Friday, but it could push a little higher.

The October low marked the beginning of another intermediate uptrend which is currently only experiencing an interim correction. Should SPX follow the proposed scenario, it will continue this pullback for another five or six more trading days into the next short-term Hurst cycle low; after which the market would be expected to continue its uptrend -- probably into early 2022 before the current intermediate trend comes to an end. 

The correction into October created a base which is capable of higher projections than those already achieved.  At a minimum, the index should be able to reach 4790 (and probably higher) before coming to the end of the intermediate trend.

  •  
  • DJIA daily
  •  
  • I have again posted the McClellan indicator underneath the daily DOW chart.  Earlier this month, this breadth indicator gave a clear warning that the market was nearing a short-term top and, even with the strong push that followed the FOMC report, it only achieved a very limited recovery.  With the current retracement, it has already made a slightly new low, enhancing its negative divergence with the DOW and projecting more weakness ahead.
  •  
  • The DOW itself is showing more weakness than either SPX or NDX in the current countertrend rally.
  •  
  •  
  • SPX hourly chart
  •  
  • The hourly SPX chart substantiated the warning issued by the daily chart indicators with negative divergence appearing in its own indicators.  This signaled that, at a minimum, a consolidation lay ahead; but by Tuesday’s close it became apparent that we had probably already struck the high point of the current short-term cycle.
  •  
  • The index is now making a corrective a-b-c pattern with the first phase ending at 4630.  From that level, the countertrend rally may have ended the second phase on Friday although, as stated earlier, we could see a little more before rolling over into the third phase of the short-term correction.  Initial selling found support at the first price congestion level indicated by the upper dotted line.  The next phase stands a good chance of progressing down to the second dotted line, at least, before ending.  We’ll know better when we have confirmed the countertrend high and started down again. 
  •  
  • USD dollar daily
  •  
  • The dollar extended its move outside of the channel and above the lower resistance level. It should continue to move to the next resistance level and to its ~96 target before putting an end to the rally which started at 90.
  •  
  •  
  • GDX gold miners - daily
  •  
  • GDX overcame its first resistance level and extended its rally in spite of the dollar strength.  But that, combined with another band of resistance, could cause it to pause for a few days.
  •  
  •  
  • PAAS – daily
  •  
  • The pattern made by PAAS continues to duplicate that of GDX.  Consequently, PAAS should also find temporary resistance at the next dashed trend line.  If the dollar reverses its trend and starts to correct, it should help both charts to extend their current uptrends.
  •  
  •  
  • BNO Brent oil fund - daily
  •  
  • BNO retested its high and pulled back, indicating that some additional consolidation/correction lies ahead. 
  •  
  •  
  •  
  • SUMMARY
  •  
  • It is likely that SPX made a short-term high at 4718 and that it will continue to correct into the current cycle low due ~11/22.

Andre

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 www.marketurningpoints.com.

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 http://www.MarketOracle.co.uk - 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