Stock-Flation Culmination

Late-2014 Cycle Peak…

          October Blues

The month of October has been a pivotal month in Stock Indices for many decades.  That includes Black Friday in October 1929, Black Monday in October 1987, the mini-crash that followed in October 1989, the post-Kuwaiti invasion low of October 1990 (that ushered in the 1990’s bull market and the notorious Tech Bubble), the ensuing low of October 2002 – that ushered in the next bull market and the real estate/sub-prime bubble of the 2000’s – and even the peak that ended that bubble, in October 2007.

The funny thing is that October has represented the month of extremes.  It has timed Major tops & crashes and it has pinpointed Major lows and opportune buying opportunities.  So, what about October 2014?  What will it hold?

…From a big picture perspective, October 2014 marks the first month (out of the 3 months that comprise 4Q 2014) when Stock Indices have the potential to fulfill expectations for a MAJOR reversal lower.

Since 2Q 2013, the focus has been increasingly targeted on 4Q 2014 for Stock Indices to reach a culmination of their 40-Year Cycle of ‘Stock-flation’, stemming from their late-1974 bottom…However, there have been many other cycles forecasting the same thing.  Among those are:

— 12-Year low (late-1990)–low (late-2002)–high (late-2014) Cycle Progression.

— 7-Year high (Jan./Mar. 2000)–high (July/Oct. 2007)–high (late-2014) Cycle Progression.

And, specific to the NQ-100 (since it set its Major low in Nov. 2008 as opposed to March 2009):

— 6-Year low (4Q 2002)–low (4Q 2008)–high (4Q 2014) Cycle Progression

— 3-Year low (Nov. 2008)–low (Aug. 2011)–high (Aug. – Nov. 2014) Cycle Progression.

As this latest bull market has unfolded – from 2008/2009 and more so from Aug./Oct. 2011 – there have been corroborating cycles that helped hone this analysis.  One of those has been the 15–16 month cycle that has governed the Indices since the March 2009 low.  It has been discussed for several years and subsequently timed lows in June/July 2010 & Oct. 2011.  After that, it arrived early – in Nov. 2012.

In retrospect (20/20 hindsight), that Nov. 2012 low was linked to the Aug. 2011 low in the Nasdaq 100 – which had arrived earlier than the Oct. 2011 lows in the DJIA & S+P 500 – creating two competing cycle lows.  That 15-month low-low cycle (Aug. 2011–Nov. 2012) projected a subsequent low in Feb. 2014 – that arrived on schedule.  But, there was more…

That Feb. 2014 cycle low had been corroborated by its half-cycle – an approximate 7.5 month cycle that helped pinpoint the late-June 2013 bottom (that was also discussed previously).  And, a 7.5 Month Cycle from the early-Feb. 2014 low – and a 15-Month Cycle from the late-June 2013 low – reached fruition in late-September 2014

2014 Sept. NQ 32 Week Cycle

32–33 Week Cycle

…The chart above (page 5) is the current action of the Nasdaq 100 and the 32–33 Week Cycle that culminated on Sept. 15–26, 2014.  Actually, it has been a very precise, 32-Week Cycle since Nov. 2012.  The current NQ-100 peak of Sept. 19, 2014 completed a precise, 32-week low-low-low-(high) CycleProgression and closely followed the NYSE peak of early-Sept

October Blues

…the action of Sept. 3rd/4th–Sept. 19th/22nd built expectations for a sharp drop in the first part of October…geometric cycles (90, 180, 360 degrees or days) converge on Oct. 13–17th and provide the perfect opportunity for a ‘precursor cycle low’.

In other words, by fulfilling the potential for an intermediate low – and the culmination of a multi-week period of selling – Oct. 13–17th could provide an archetype of what to expect in mid-April 2015, 180 degrees in the future.  So, an intermediate bottom around mid-October could have very revealingcurrent AND future ramifications.

One possibility (that would HAVE to be corroborated by intervening action) is that mid-April 2015 could culminate a larger-degree, multi-month period of selling… potentially brought on by some extra-market, geopolitical event…that would be cyclically similar to what took place in Sept. 2001.  For two years (from mid-1999–mid-2001), INSIIDE Track had been detailing and focusing on War Cycles projected for August–October 2001…Stock Indices – and other cycles – helped pinpoint that focus to September 2001.

From April 2000 until Sept. 8, 2001, analysis continued to explain why a Major bear market in stocks was foreboding a Major war event in late-2001. Among the speculation (first published in April 2000) was that ‘America’s shores’ could get hit by another ‘giant surprise’ – cyclically-linked to the attack on Pearl Harbor in 1941.

In late-2000, after the Indices had fulfilled the potential for a Major peak in early-2000, the charts showed that a break below the Oct. 18, 2000 lows (isn’t it intriguing how an October 18th low became the final confirming factor for a Major bear market) would project a sharp, extended decline intoSeptember 2001 (see Dec. 2000 IT analysis).

That is another example of how cycles and technical analysis in the markets closely foreshadow events outside of the markets.

…So, could the market events of October 2014 – and the ensuing months – shed some light on what to expect in April 2015?  Absolutely.  And that will be the topic of an ongoing discussion.

In order to validate the potential for future (larger) declines, the Indices need to break key support levels – like the August lows and the intra-year lows. The Weekly Re-Lay has already detailed key levels to watch on a short-term basis – leading into mid-October – and INSIIDE Track publications will continue to address the bigger-picture analysis.

Follow-up publications will provide more specific downside targets and corroborating signals – which should help identify if the long-awaited, late-2014Stock Index peak is already intact.  This Report is simply intended to ’set the stage’ and provide critical context for impending analysis.  IT    [See INSIIDE Track 40-Year Cycle: Stock-flation 1974–2014 for additional details, charts, tables & diagrams that elaborate on expectations for an initial sharp drop intoOct. 13–17, 2014 and a more significant move leading into mid-April 2015.]   Futures trading – as well as trading or investing in ETFs, stocks & funds – involves substantial risk.