DJIA Reinforcing 2018 Outlook; Late-Nov./early-Dec. Cycles are Key.
DJIA Reinforcing 2018 Outlook; Late-Nov./early-Dec. Cycles are Key.
06/29/18 INSIIDE Track: Equity markets peaked in late-Jan., the culmination of 5-month & 10-month Cycle Progressions. That was projected to trigger an initial decline through March 2018 – with subsequent highs expected in June & Nov. 2018. They are fulfilling multiple cycles and could see a 1 – 2 month correction…
Stock indexes are fulfilling the third significant (multi-month) cycle in 2018. They were forecast to peak in mid-to-late-Jan. ’18 and then decline into late-March ’18 before rebounding into mid-to-late-June 2018. If the recent highs hold (for at least two months), it would project a subsequent high (more likely a lower high) for Nov. ’18.
Since that overlaps with larger-degree cycles that converge in 4Q 2018 (more likely to time a 3 – 6 month bottom), the intervening price action will need to clarify if those are two distinct cycles or if they merge into one, with one inverting. 4Q 2018 is the latest of a ~3.25 year (12 – 13 quarters) low-low cycle that has timed important lows in 3Q 2002, 4Q 2005, 1Q 2009, 2Q 2012 & 3Q 2015.
The action of 2018 is reinforcing expectations that this time period – stretching into 2020 or 2021 could look a bit like 1978 – 1980/1981 (40-Year Cycle) during which a combination of competing forces – including accelerating inflationary pressures – kept the market in a volatile trading range for a few years. [That is just a general assessment and is not intended to imply comparative months or years… just an overall parallel.]
The DJIA maintains key support at 23,360 – the level of its early-Feb low and its weekly trend reversal point. That support was tested in late-March and again in early-April, but has held each time.
It would take a weekly close below 23,360/DJIA to signal a larger-degree correction that could take it down to at least 22,900/DJIA and closer to its 2018 support & primary target for the year – around 22,100/DJIA.”
Stocks are steadily adhering to their 2018 outlook, anticipating an initial high in late-Jan./early-Feb,. subsequent low in late-March and rally to new highs (potentially stretching into 3Q 2018) – based on their weekly trend patterns.
Once those highs are set, they should see a new sell-off followed by a bounce into pivotal cycles in late-Nov./early-Dec. – that portend the entry into a more bearish period. 22,100/DJIA remains the primary downside target for 2018 and could be hit before or after the late-Nov./early-Dec. (secondary) peak.
See Weekly Re-Lay & INSIIDE Track for additional analysis and/or trading strategies.