August ’19 Stock Plunge XIV: Quick Bounce into Aug. 21 Likely; NYA Cycle High (Aug. 20 – 22) Corroborates Aug. 21 – 30 Danger Period… Daily Trends Should Concur.
08/19/19 INSIIDE Track Intra-Month Update – “Stock Indices are reinforcing the current corrective phase, rebounding after the DJIA and other indexes (NYA, DJTA…) spiked to new sell-off lows on Aug. 15 – bottoming on a short-term basis at mid-month and in the week after they had twice neutralized their weekly uptrends and in the week after they had attacked weekly HLS levels.
That spike low, combined with the weekly trends and weekly HLS indicator, left them in a 1 – 2 month range of congestion – needing to turn their weekly trends down to elevate these declines. Until that occurs, congestion remains in control.
As of Aug. 16, all the primary stock indexes had generated multiple neutral signals against their prevailing weekly uptrends – but would not turn those weekly trends down until weekly closes below xx,xxx/DJIA,xxxx/ESU & xxxx/NQU. They have completed a normal intermediate correction and need those negative weekly closes to elevate these declines to a 2 – 3 month correction. [Specifics & trading strategies reserved for subscribers.]
In addition, the divergence at the mid-month lows, reinforced this consolidation as most indexes have been unable to close below their Aug. 5/6 lows or to turn their intra-month trends down. Corroborating that conclusion is a form of wave comparison…
In May/June, the DJIA sold off for 22 trading days, losing about 2,000 points before encountering intermediate support.
In July/Aug, the DJIA have now sold off for 22 trading days, losing about 2,000 points before encountering intermediate support.
From a weekly cycle basis, the DJIA has been expected to set (at least) a multi-week low on Aug. 19 – 30 – the latest phase of an 11 – 12 week high (Oct. ’18) – low (Dec ’18) – low (Mar ’19) – low (Jun ’19) – (low) Cycle Progression. Its Aug. 15 low came within two trading days of perpetuating that weekly cycle.
Other indexes have weekly cycles bottoming in Sept. ’19, which is why there is still the potential for additional downside in this July – Sept. ’19 bearish period.
Stocks are entering a multi-week period when the weekly 21 MACs have a much better chance of reversing lower, so another leg down is still likely. On a short-term basis, daily cycles and the daily LHR indicator could be honing the most likely time for another short-term peak.
The daily trends (in DJIA, DJTA, NYA, etc.) cannot turn up until Aug. 21, at the very earliest. That is often the time when a rebound peak is set and a new reversal lower unfolds. The daily LHR indicator (in about half of the indexes monitored) portends a new 1 – 2 week peak on Aug. 20/21. Then there are daily cycles…
In early-Aug., daily cycles were projecting a secondary high for Aug. 8 – 12, followed by another sharp sell-off. The Aug. 7, 2019 Weekly Re-Lay Alert placed this in context when it stated:
However, with the acceleration seen in recent days, other indicators need to corroborate that. (That is also true since cycles that are this short-term in nature could produce an initial high by/on Aug. 8, pull back for a couple days and then rally to slightly higher rebound highs during the next phase of those daily cycles.)”
The next phase of that cycle in the NYA is on Aug. 20 – 23, 12 – 14 days from the Aug. 8/9 high. The ideal price level for an intra-week high is near weekly resistance. Those levels are in the Aug. 17 Weekly Re-Lay and are reprinted above.
On a much larger basis, DJIA is trading below its Jan. ’18 peak, below its Oct. ’18 peak and below its April ’19 peak. In other words, it remains in a wide trading range – with the upper and lower parameters set by the rally from Aug. ’17 into late-Jan. ’18. That continues to be what was/is anticipated for 2018 – 2019.
The NYSE Index has added another level to that sequence, with each subsequent peak (Jan. ’18, Sept. ’18 & July ’19) occurring at or below the previous one. The NYA turned its weekly 21 MAC down AND closed below it on Aug. 16. As conveyed in the Aug. 17 Weekly Re-Lay, that is a bearish combination that has more of a 2 – 3 month impact than a 2 – 3 week impact since it can – like a weekly trend reversal – time an initial low and reactive bounce. Look for more volatile swings in the weeks ahead.”
Stock markets fulfilling forecast for quick bounce into Aug. 20/21 (could stretch into Aug.22, based on NYA daily cycles) before next danger period takes hold on Aug. 21 – 30! Daily trend pattern should produce another 1 – 2 week sell signal on Aug. 21 or 22. 40-Year Cycle AND 4-Year Cycle project Aug. ’15-style sell-off. What does this reveal about Sept. – Dec. 2019?? And 2020???
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.