Market Trends - Looking Ahead!

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:  SPX has completed the next phase of its intermediate uptrend and should correct.

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.

SPX Short-term Correction

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) 

SPX (weekly)

The intermediate trend, as defined by the weekly SPX chart is still up and weeks away of giving a sell signal.  This is verifiable with the chart pattern itself, which is still in an obvious uptrend, although apparently overbought since the index is trading at the top of the intermediate channel which started in October 2020.  It is also apparent that the oscillators at the bottom of the chart are still in a buy mode, although the slightest warning is appearing that we may be coming to the end of this intermediate trend in a few more weeks.  And finally, the P&F base pattern is projecting higher levels for the index ranging from 200 to 300 points higher before we should be concerned with an important correction.

The short-term trend, as we will see next, is not so bullish and it is warning of an impending downtrend. 

SPX daily chart

The daily chart shows that we have come to the end of phase two for the move which started from 3723 in March, and that we are ready for a short-term correction before the start of phase three of this move. The upside P&F price projection has been reached and the short-term trend line of phase two was broken in the last couple of days.  The oscillators are also turning bearish.  The CCI which had been flashing negative divergence for the past few days (something which happens in the last stages of a trend) turned down on Friday.  The SRSI, which is the early bird, went negative ten days ago, and just marked time as the index was completing its 4210-20 P&F projection.  SPX made a high of 4218.78 on Thursday before turning down.  

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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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