Stocks Preparing for Major 1Q ‘25 Sell-off & Potential ‘March Meltdown’!
01/31/25 – “Stock indices are steadily going through a topping phase after initially fulfilling the latest phase of the 17-Year Cycle of Stock Market Peaks – setting multi-month highs in 4Q 2024. Similar to late-2021, the small & midcap indexes were expected to lead this transition period.
The S+P Midcap 400 was the primary focus and was projected to spur an Oct/Nov ‘24 surge leading into a multi-month peak on Nov 22/25, 2024.
That index precisely fulfilled that outlook and peaked on Nov 25th, along with the Russell 2000 & DJTA.
Those indexes sold off, ultimately turning their weekly trends down (a lagging/confirming indicator that often reverses as an intermediate low is taking hold). That was the first confirmation of a multi-month peak – and a key validation to the 17-Year Cycle – but more confirmation is needed.
Next Step(s)
As that was unfolding, the NQ-100 retraced but did not turn its weekly trend down (a weekly close below 20,983/NQH is needed to turn it down) – leaving open the potential for a retest of its high before a higher-magnitude peak takes hold. That kind of divergence has become routine during multi-month topping and bottoming phases.
During the recent sell-off – that lasted into intermediate cycle lows during the week of January 13 – 17, ‘25 – several stock indexes generated another revealing signal that has more significance in the future… after a subsequent rally. That signal was triggered on January 10/13.
That is when the DJIA, Russell 2000 & S+P Midcap 400 exceeded the magnitudes of their late-July/early-August plunges – the largest declines of 2024. As a result, those indexes (as well as the DJTA, which did the same thing in mid-December) triggered 4-Shadow Indicator signals on a 6 – 12-month basis.
Now & Later
In many ways, that indicator possesses parallels to the weekly trend indicator with three critical (similar) facets providing important portents:
- The most immediate portent is that both signals warn of an imminent (but only initial) low.
- The second, correlating similarity is that both signals project a reactive rally to follow.
- The third parallel is that both indicators warn of a future, more significant decline to take hold after that reactive rally has played out.
That reinforced intermediate cycles projecting a multi-week low for mid-January. Stock indexes bottomed on January 13th and began the (likely) multi-week reactive rally.
1 – 2 Month Support
There was a myriad of corroborating price targets, support & indicators also projecting a multi-week low for that week (Jan 13 – 17, ‘25). One involved the DJIA and its ongoing 1 – 2 month downside target near 41,800. That is a level that has been in focus since early-December and was finally attacked on January 13th:
12-14-24 – “The DJIA topped while fulfilling a ~4-week (25 – 28 day) low-low-low-(high) and a ~16-week low-low-(high) Cycle Progression and was projected to see an initial drop into Dec 16 – 19th… as part of a multi-week drop to 41,600 – 41,800/DJIA.”
At the same time, the S+P Midcap was retesting & holding multi-month support near 3100/IDX.
Corroborating that week’s cycle & indicator lows, the NQ-100 bottomed right at monthly support and the S+P 500 fulfilled a pair of equidistant downside wave objectives, creating additional examples of wave symmetry within that overall correction.
In doing so, the S+P 500 completed similar declines on a multi-week and multi-day basis while testing and holding the July ’24 peak (resistance turned into support) and the Oct ’24 low (4th wave of lesser degree support).
It bottomed at those targets on Jan 13th, the precise time it completed successive equal declines on an intermediate (11 trading days each) and short-term (7 days each) basis… fulfilling wave symmetry on multiple levels of time AND price. That signaled the culmination of its latest sell-off.
The DJIA, S+P Midcap, Russell 2000 & DJTA bottomed at their October ’24 lows – pivotal (initial) 2 – 3 month support – as the Midcap reached its 10% decline threshold.
All of that reinforced expectations for a multi-week reactive bounce, which is now maturing.
Bigger Picture
On a 6 – 12 month (and intra-year) basis, those mid-January lows are now pivotal. It would take weekly closes below them to signal that a new 1 – 2 month (or longer) decline is unfolding. Until that occurs, stock indexes have fulfilled an initial sell-off but have not yet elevated that to a higher magnitude 3 – 6 month decline.
If a new decline takes hold in early-Feb, this correction could stretch into March/April ‘25 – the convergence of multiple cycles & Cycle Progressions including an 18/19-month low-low-(??) Cycle Progression, a 2-Year Cycle (DJIA peaked in late-Nov ’22 & sold off into March ’23) and an annual cycle that timed intra-year lows in 2020, 2023 & 2024…
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Stock Indexes are adding corroboration to major peaks projected for late-Nov ’24 – set on November 22/25th while fulfilling repeatedly-published cycles and major upside price targets. That ushered in what was projected to be 3 – 6 month (or longer-lasting) peaks in late-Nov. ’24… and to ultimately lead to major 2025 plunges as part of a major setback in equity markets.
Subsequent highs – particularly in the S+P Midcap 400 – were projected for ~January 22nd and expected to prepare the way for sharper declines in February ’25, a possible March Meltdown, and confirmation of a broader stock market (seismic) shift. That is in sync with weekly trend and multi-month 4-Shadow signals triggered on January 10/13th that projected a 2 – 3 week reactive bounce before a much larger stock plunge takes hold. Many indexes peaked precisely on January 22nd!
The 17-Year Cycle projected 4Q 2024 as the most likely time for a major peak in equities – and 2025 as the time for the next major decline. In line with that, the DJIA is already revealing eerie parallels to late-2007/early-2008 and providing a roadmap for future expectations. Cycles and timing indicators are already identifying the next likely time frame when a future sharp sell-off is likely… in (see publications for details).
Do January 22/23rd (Divergent) Highs Reinforce Outlook for ‘March Meltdown’?
How Would Late-Jan/Early-Feb Peak Reinforce 1Q ‘25 Bearish Outlook?
What Do Weekly Trend & 4-Shadow Signals Bode for February/March ‘25?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.