August Omens Fulfilled; Stocks Project New ‘Danger Period’ After Mid-Sept ’23!
08/30/23 – “There are certain points within each given year, and within any given cycle, that act as inflection points – a perfect time to assess what has occurred up to that point and what could/should follow.
They are often the culmination of one intermediate cycle and the onset of a subsequent one (that combine with other intermediate cycles to create the larger overriding cycle). They usually reveal themselves months in advance and are steadily reinforced as their fulfillment approaches and corroborating cycles or events emerge.
A perfect example was in late-Feb/early-March ‘22, when cycles in Gold & Silver, Wheat & Soybeans, and a host of other markets projected an accelerated rally as geopolitical cycles collided.
Analysis and expectations for that time frame were published for months in advance. When Russia invaded Ukraine, Gold & Wheat skyrocketed, and most other markets reacted accordingly, it powerfully fulfilled that ‘pivot point’.
August Omens in Focus
Another of those pivot points was forecast for late-August ‘23, with the greatest attention paid to the 3-day period of Aug 22 – 24, ‘23. Overall market focus was on a slightly broader time period, encompassing the two-week period of Aug 14 – 25, ‘23 with diverse market cycles pinpointing different days for corresponding turning points.
In the case of all these pivot points, the weeks leading into them and the weeks leading out of them are just as critical (as the cycle or pivot point itself) and often reveal contrasting mindsets in traders and political leaders. A quick overview of related 2023 analysis illustrates this and shows how a cycle like this steadily reveals itself over months of time…
For starters, stock indexes were forecast to decline from late-July/early-August into late-August when weekly cycles bottomed in many indexes. Those cycle lows had been discussed for many months but the timing of a preceding final high would not be revealed until it was close at hand.
Stock market action often anticipates underlying events – developing or future – that are not yet obvious to the masses. Those events are ’flying under the radar’, so to speak. That is why expectations for equities to sell off into this pivot point was intriguing.
Most stock indexes peaked in late-July/early-Aug with the Russell 2000 again providing some of the most precise, and prescient, action as it precisely fulfilled upside targets and reversed lower. As the month of August unfolded, and stocks sold off, the timing for a late-Aug low became more clear. The Aug 16, ’23 Weekly Re-Lay Alert put it this way:
“Stock Indices are steadily selling off after peaking and reversing lower in late-July/early-August ‘23, turning daily & intra-month trends down as a significant ‘danger period’… was immediately followed by the Russell 2000 generating an outside-week/2 Close Reversal sell signal on Aug 4, ’23, projecting a minimum 2 – 3 week decline to follow…
Coinciding with that peak, the Russell 2000 reached its 3 – 4 month upside targets (stemming from its March ’23 low) at 2000 – 2015/QRU… This decline has an initial downside target of 1825 – 1840/QRU – where 1 – 2 month support exists.
For the past ~2.5 years, the Russell 2000 has set a multi-week, often multi-month, low every 21 – 22 weeks. That has occurred six straight times and could recur if it sells off and sets a low… ideal time (greatest synergy) for that low would be on Aug 18 – 28…”…
In sync with that, geopolitical cycles were anticipating something that would time a shift in that conflict (and later be viewed as a turning point). The Aug ’23 INSIIDE Track explained why the most likely fulfillment of those cycles would be Vladimir Putin ’making a statement’ of some form. The following is a brief summary of that analysis:
“In the case of metals and other markets, the correlation between intermediate cycles (surrounding the week of Aug 21 – 25, ‘23) and Russia/Ukraine-related cycles is worth monitoring.”
“…the latter part of August ‘23 is the anniversary of multiple Russia-related revolts, coups, attacks… particularly Aug 22 – 24. Here is a small sampling:
- Aug 23 – 30, 1914 – Battle of Tannenberg… decimating Russia’s First & Second Army (triggered on Aug 17 – 22, 1914).
- Aug 30, 1918 – Assassination attempt on Lenin leaves him seriously wounded; triggers Red Terror (mass arrests and executions).
- Aug 23, 1939 – USSR/Nazi Germany non-aggression pact signed. In the ~month that follows, Nazi Germany and then the USSR invade Poland.
- Aug 24, 1991 – Ukraine Independence
- Aug 24, 2023 – 18-month anniversary of Russia invasion of Ukraine & 12-month/6-month anniversaries of major US aid announcements… Seems like a prime time for Mr. Putin to make a statement.”
On Aug 23, ’23 (also the 80th anniversary of the Battle of Kursk), a plane carrying Wagner Group leader Yevgeny Prighozin, the co-founder of the Wagner Group and others in its hierarchy was brought down by an explosion. This was the same Prighozin that, exactly two months earlier (another anniversary cycle) led a March on Moscow – a combination of revolt, coup, and attack in alignment with these cycles.
So how did ABC News summarize this event?
“If you’re Putin, you want to make a statement here — that’s the point,”
What about the New York Times?
“The Kremlin appears to be sending the signal… it underscored the imagery of dominance and power that Mr. Putin… appears more determined than ever to project… After the crash of Mr. Prigozhin’s plane on Wednesday, the Kremlin appears to be sending the message…” (or ‘making a statement’)
And what about CNBC.com?
“He [Putin] needed to demonstrate who really is running the joint… describing the attack as a “public execution.”
It appears as though most sources are in agreement – Mr. Putin ‘made a statement’, a very bold statement, precisely when cycles projected he would… on Aug 22 – 24, 2023! The more intriguing aspect of all this is what will follow. The markets are speaking…
Stock Indices fulfilled the August outlook for an intermediate peak in late-July/early-Aug and a drop into the second half of the month when multiple cycles bottomed. Once again, the Russell 2000 provided some early-warning signs at the peak and some convincing troughing signs at the low.
On a multi-week basis, equities were forecast to decline into – and set multi-week lows during – the period of Aug 18 – 25, ideally on Aug 18 – 22, ’23. The S+P 500 & 400, NQ-100 & DJTA set their intraday lows on Aug 18. The DJIA & Russell 2000 retested and barely spiked below their Aug 18 lows, on Aug 25, but immediately rallied.
The NQ-100 neutralized its weekly uptrend for the second time on Aug 25, while dropping right to its rising weekly 21 High MAC and closing the week above that ascending support… That, too, signaled a multi-week low and projects a subsequent rally… into mid-Sept ’23…
On Aug 25, the Russell 2000 also neutralized its weekly uptrend for the third time – but did not turn it down – while repeatedly testing & holding 1 – 2 month support at ~1840/QRU. It did that while fulfilling a ~22-week low-low cycle that has governed its action for ~2.5 years (see HCP diagram on page 4)…
The weekly trend structure, when combined with prevailing daily/weekly cycles, is still projecting a rally into mid-Sept ’23, at which time a more significant peak could be seen.
On a broader basis, equities continue to trace out a large, multi-year topping phase that began with 1 – 2 year (or longer) peaks in late-2021/early-2022 and could be followed by [reserved for subscribers]… That would perpetuate an uncanny 17-Year Cycle that has also had a remarkably strong correlation with and adherence to Middle East War/Conflict Cycles (which begin in Sept 2023).
That 17-Year Cycle previously timed the 3Q 1990 equity peak as Saddam Hussein was invading Kuwait (Middle East war) and triggering what would ultimately be a pair of ’Persian Gulf Wars’. That arrived another 17-Year Cycle from the 1973 Major stock market top and coinciding Yom Kippur War.
That 1973 stock market peak (and ~50% crash) came a full 17-Year Cycle from a multi-year stock market top in 1956 (that triggered a ~20-month/~15% decline)… and a corresponding Middle East war (Suez Crisis or Second Arab/Israeli War).
And that peak arrived 17 years after a secondary peak was set in 1939 – leading to a ~30-month/~37% decline that overlapped the Great Arab Revolt. In other words, it has been a consistent cycle…
Omen or Outlier?
The Russell 2000 remains an intriguing index that has powerfully reinforced (and often guided) this multi-year topping process. As it was rallying from its March ‘23 low, the Russell was forecast to reach ~2000/RT before a multi-month top was likely.
Corroborating that target, a pair of convincing trend indicators were converging in July/Aug ’23… at the same resistance near 2000/RT. The monthly 21 High MAC and 40 High MAC (illustrated above) were expected to time a peak and spur a reversal lower in Aug ‘23. That is exactly what transpired.
Its action in Sept ‘23 could provide more clues.
Longer-term traders and investors should have exited multi-year long positions… A new correction is likely after mid-Sept ‘23.”
The stock market again led geopolitical events, setting what were forecast to be multi-month peaks in late-July/early-Aug ’23 and entering a very precarious time (‘danger period) in the months that followed.
The Russell 2000 is again leading a multi-month reversal lower, peaking right at is converging monthly 21 & 40 High MACs – the upper ranges for its 3 – 6 month and 6 – 12 month trading ranges – providing a myriad of ‘ideal’ criteria for a major ‘B’ wave rally to peak and a large scale ‘C’ wave to begin. It also attacked and held CRITICAL intra-year trend resistance (as did the S+P Midcap 400) and reversed lower. A second, more significant ‘danger period’ begins on/after Sept 15, ‘23.
The S+P 500 confirmed a multi-month peak was set in late-July/early-Aug ’23 – the precise time stocks had been projected to enter a precarious ‘danger period’. It turned its weekly trend down during the initial drop into late-Aug ‘23 – a lagging & confirming indicator that is usually triggered near the bottom of an initial sell-off and portends a reactive 1 – 3 week bounce… into the next bearish period after Sept 15, ’23, when a more significant decline has been forecast.
Is the Russell 2000 the ‘Canary in the Coal Mine’… or an Outlier?
Does S+P 500 (Negative) Weekly Trend Reversal Confirm Peak?
Why is Another Sell-off Very Likely after Sept 15, ‘23??
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.