EC Approaching An Intermediate Peak

Current Position of the Market - Approaching an Intermediate Peak

  • SPX Long-term trend: There is some evidence that we are still in the bull market that started in 2009. This trend could continue into 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, which is due in 2023.
  • SPX Intermediate trend: Phase three (wave 5 from 3723) is now likely underway.
  • Cycles: Looking ahead.
  • Seven-year cycle – Last lows: 2009-2016. Next low: ~2023.

Market Analysis IWM vs. SPX 

I have already mentioned that IWM had issued a warning that a correction is coming. Now let us turn to the more precise prediction that we will shortly be making an intermediate top in the market. It comes from the long-term point & figure chart of the SPX.

The accumulation base that was formed at the 2020 low can be divided into phases, each of which is giving us a projection of price levels to where SPX should correct as it climbs to its ultimate bull market peak.

On its weekly chart, I have posted the various targets. Each represents a level where the index was expected to consolidate before moving higher. You can see how accurate they have been. We are approaching the next to last target of 4310 which should mark the start of an important intermediate correction, perhaps more in the order of the one which took place at the 3580 level.

Although the previous ones have been uncannily accurate, it is always possible that the next two – because we are approaching the top of the bull market – will only be close approximations. We will soon know.  

The two oscillators at the bottom of the chart have been helpful for determining the validity of the projection. The current target is no exception. As you can see, they are also forecasting an intermediate correction directly ahead by showing strong negative divergence. A final note regarding an imminent top: Eric Hadik is forecasting the inversion of an intermediate cycle in this time frame.

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Charts are courtesy of QCharts.

The above comments, as well as those made in the daily updates and the Market Summary about the financial markets, are based purely on what I consider to ...

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