Stock Market Commentary
We are three weeks into the rally phase of the intermediate-term cycle that began in late March.
The magnitude of the last decline phase signals the likely transition to a bearish intermediate-term trend, and favors additional losses during the next decline phase.
S&P 500 Index Weekly Chart Analyses
The following technical and cycle analyses provide intermediate-term forecasts for the S&P 500 index.
Technical Analysis
The index closed sharply higher this week, reacting further off of previous lows of the violent downtrend from February. Technical indicators are moderately bearish overall, favoring a return to previous lows of the decline.
Cycle Analysis
We are three weeks into the rally phase of the cycle following the intermediate-term cycle low (ITCL) that occurred during the week ending March 27. The magnitude of the last decline phase signals the likely transition to a bearish translation, and favors additional weakness. The window during which the next ITCL is likely to occur is from July 10 to September 11, with our best estimate being in the August 7 to September 4 range.
- Last ITCL: March 27, 2019.
- Cycle Duration: Three weeks.
- Cycle Translation: Bearish.
- Next ITCL Window: July 10 to September 11; best estimate in the August 7 to September 4 range.
- Setup Status: No active setups.
- Trigger Status: No pending triggers.
- Signal Status: No active signals.
- Stop Level: None active.
Intermediate-term Outlook
- Bullish Scenario: A weekly close above current levels would predict a move up toward the middle of the Bollinger bands at 3,054.
- Bearish Scenario: A reversal and weekly close below the recent short-term low at 2,290 would reconfirm the downtrend from late February, and forecast additional losses.
Both scenarios are equally likely.
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