Intermediate-Term Forecast For Saturday, May 30

We are 10 weeks into the rally phase of the intermediate-term cycle that began in March.

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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, moving up to a new high for the uptrend from March. Technical indicators are slightly bearish overall, tentatively favoring a return to previous lows of the downtrend from February.

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Cycle Analysis

We are 10 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: 10 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.

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Intermediate-term Outlook

  • Bullish Scenario: A weekly close well above congestion resistance in the 3,000 area would reconfirm the uptrend from March and forecast additional gains.
  • Bearish Scenario: A reversal and weekly close below the 200-week moving average at 2,676 would predict a return to the previous intermediate-term low at 2,290.

Both scenarios are equally likely.

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