Stocks Set For Pullback into May 4; New Rally to Follow. 40-Year Cycle Remains Bullish (Since March 23)!
04/25/20 Weekly Re-Lay: “Stock Indices remain in a positive multi-week trend after fulfilling the outlook for a plunge from Feb. 12/13 into Mar. 23 – 27 (fulfilling the 2-Year & 40-Year Cycle). They have since rallied and are fulfilling intermediate upside targets but are likely to retest those levels in the coming days…
The DJTA, NYA, Russell 2000 and weaker stocks led this latest correction, fulfilling analysis for multi-week peaks on April 9/13 and projected to decline into April 24 (+ or – 1 trading day). The daily trends were/are the guiding factor in how long the recent highs would hold, how low the ensuing drop would reach, and what the rally that follows would look like.
Those daily trends have spoken.
In each case, the daily trends turned neutral but could not reverse down, leaving stocks in positive territory. In many cases, the indexes dropped right to their ascending daily 21 High MACs and held. And, in a majority of those cases, the indexes dropped to weekly support (8310 – 8390/NQM, etc.) as they sold off into mid-week – the first phase of an overall topping phase.
When the dust settled, they bottomed on April 22, one day shy of the range for this latest low. They subsequently re-entered their daily uptrends – projecting rallies to new recent highs. That will likely trigger a test of the upper extremes of their target ranges…
Stock indexes plunged right to their daily HLS levels on April 21, increasing the likelihood for lows in the ensuing 1 – 3 days. They reversed higher on April 22 and are likely to spike to new rebound highs before the next sell-off. The DJIA is a little different than the DJTA, having created a 40-day high (2/12) – low (3/23) – low Cycle Progression projecting a multi-week low for May 2 (May 1 or 4).
That dovetails with recent intra-month lows set in the first three trading days of the new month. If the indexes see another multi-day sell-off in late-Apr./ early-May – it should lead to a low on May 4 or 5.”
Stocks poised for quick pullback into early-May (higher) low before next stage of advance takes hold. Stocks should continue to remain above March ’20 lows after fulfilling Stock Panic Cycles (projected for early-2020) as well as 40-Year Cycle and 2-Year Cycle projecting plunge into March 23 – 27, 2020 – the precise time the DJIA bottomed in 2018 AND 1980.
Transports reached multi-year downside target (6,500) – providing corroborating price action that should remain pivotal. Major indexes triggered buy signals on March 18 – 23 – reinforcing those cycle lows.
What Does 40-Year Cycle Portend for 2Q/3Q ‘20?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.