Short-Term Forecast For Wednesday, April 8

We are 12 sessions into the alpha phase rally of the short-term cycle that began on March 24. The alpha high (AH) of the current cycle will likely form sometime during the next 3 sessions.

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The magnitude and duration of the last beta phase decline reconfirm the current bearish short-term trend and favor additional short-term weakness.

S&P 500 Index Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the S&P 500 index.

Technical Analysis

The index closed sharply higher today, returning to recent short-term highs above previous lows of the violent downtrend from February. Technical indicators are effectively neutral overall, suggesting that direction is in question.

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Cycle Analysis

We are 12 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on March 23. The alpha high (AH) will likely form sometime during the next 3 sessions. The magnitude and duration of the last beta phase decline reconfirm the current bearish translation and favor additional short-term weakness. The window during which the next STCL is likely to occur is from May 4 to May 22, with our best estimate being in the May 14 to May 20 range.

  • Last STCL: March 23, 2020
  • Cycle Duration: 12 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: May 4 to May 22; best estimate in the May 14 to May 20 range.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

(Click on image to enlarge)

Short-term Outlook

  • Bullish Scenario: A close well above congestion resistance in the 2,750 area would reconfirm the oversold reaction from late March and forecast additional gains.
  • Bearish Scenario: A reversal and close below the recent short-term low at 2,458 would forecast a return to the previous short-term low at 2,237.
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