Extending Phase Two?

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 comes to an end. 

SPX Intermediate trend:  Phase two from 3853 does not look complete.

Cycles:  Looking ahead! 

90-yr cycle – Last lows: 1843-1933. Next low: ~2023 

40-yr cycle -- Last lows: 1942 -1982. Next low: ~2022 

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

Market Analysis (Charts, courtesy of QCharts) 

IWM - SPX (weekly)

SPX made a new all-time high today!  IWM made a new all-time high eight weeks ago!  We know what this disparity has suggested in the past:  a market correction is coming.  There is no reason to believe that it will be any different, this time.  Unless, of course, IWM loses its relative weakness and starts to make new highs.  

SPX daily chart

SPX is being pulled in different directions by the Nasdaq which is correcting and the DJIA which is making daily all-time highs.  As a result, the intention of this index has become unclear.  After rising from the 3853 low, it made two consecutive short-term tops: one from 4191 on 4/16 which brought about a 73-point correction, and another from 4219 on 4/29 which resulted in a 100-point pullback and ended on 5/04.  Since then, SPX has already made a new all-time high and appears to have started a new uptrend which could prolong phase two -- but perhaps not by much (SPX, IWM).  

First, the relative weakness exhibited by IWM suggests that a deeper correction should soon be taking place.  Second, the P&F pattern is more suggestive of a top than of a base.  And third, a dependable short-term cycle is scheduled to bottom around the 17th.  That cycle is also obvious on the DJIA which should be in the process of topping any day, now.  This would fit with the current SPX structure which may require another day or two to complete.

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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 be sound technical analysis principles. ...

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GoldPlatedDiapers 1 month ago Member's comment

I'm just curious what your thoughts are about the fact that IWM has closed 9 weeks in a row above a resistance trendline from late 2015, most easily seen on the weekly chart. I have figured it's been in consolidation and about to move up.

Angry Old Lady 1 month ago Member's comment

Interesting username you have there GoldPlatedDiapers! I prefer the solid gold kind myself.