DJIA/Stock Market Low: 1Q ’22 Sell-off Complete; Rally into April ’22 Likely.
03/02/22 Weekly Re-Lay Alert – “Stock Indices initially bottomed on Feb 23/24, fulfilling a ~1-month/~30 degree cycle that has timed the lows in 6 of the past 8 months. In doing so the NQ-100 and S+P 500 dropped to new lows – fulfilling their weekly trend patterns – as the DJIA likely set a multi-week bottom in sync with its own weekly trend structure.
Meanwhile, the Russell 2000 & S+P Midcap 400 held their late-Jan lows while creating double bottoms and setting the stage for a larger-magnitude rally.
As stressed last week, they have likely completed their latest sell-off – fulfilling the broader expectations for 1Q ’22 linked to not only the 2-Year Cycle but also the pair of 4-Shadow Signals. They combined with 2, 4 & 8-month cycles in projecting a decisive peak in early-Jan followed by the sharpest sell-off since 1Q ’20.
This 2 – 3 month sell-off has powerfully reinforced the 2-Year Cycle and repeated the pattern witnessed in 1Q 2010, 2014, 2016 & 2018 (with similarities to 1Q ’20) – when substantial declines occurred in Jan/Feb of those years.
As illustrated in the March ’22 INSIIDE Track, the price and wave action since Nov ’21 has been remarkably similar to the price and wave action seen during the same period (Nov – Feb) in 2015/2016 (see accompanying charts).
That dovetails with what was described in the Feb 2, ‘22 Weekly Re-Lay Alert, even though the action is offset by 1 – 2 weeks (history rhymes, it does not repeat… or as I like to say: “Cycles spiral, they don’t circle”… describing how they go through repeated 360-degree revolutions but never end up at the same starting point):
2-02-22 – “Many indexes have paralleled action in 2015/2016, including 2Q ‘15/’21 highs, Aug ‘15/’21 lows, rebounds into late-Dec. ‘15/’21 and subsequent sharp sell-offs in Jan ‘16/’22… another sell-off was seen in early-Feb but only certain indexes spiked to new lows while others set higher lows. The action in early-2022 could be like 2016.”
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After setting those lows in 2016, stock indexes initially rebounded and twice neutralized their daily downtrends – just as they did last week. They hesitated for two days, similar to now, and then rallied – reversing their daily trends up on the 5th trading day after the low was set.
Tomorrow is the 5th trading day since the Feb 24 low. And while I do not look for each swing and price movement to be repeated exactly, this entire move has been so similar that it would not be surprising to see another parallel between 1Q ’16 and 1Q ’22.
Already, a couple indexes have confirmed a multi-week bottom with the DJTA & S+P Midcap 400 turning their daily trends up. All the other (primary) indexes have not yet accomplished that, requiring daily closes above 34,095/DJIA, 4386/ESH, 14,292/NQH & 2056/ QRM to turn those daily trends up.
After tomorrow’s (March 3) trading, the intra-month trends will also become a (potential) validating factor – requiring a daily close above the high of March 1 – 3 (first three trading days of new month) to turn the intra-month trends up and project additional upside.
Stocks subsequently rallied back to their Nov ’15 highs, in late-April ’16, before correcting for a few weeks. Will something similar repeat in 2022?
At least one factor is moving in that direction…
As already noted, the DJIA has a consistent 14 – 15 week low-low-low-high Cycle Progression – dating back to March ’21 – that portends a future peak on April 11 – 22. For now, the daily & intra-month trends are the keys to whether or not any additional lows are possible (before then) in some of the indexes.”
Stocks have fulfilled the outlook for a decisive peak in early-Jan ’22 followed by a 2 – 3 month plunge into a multi-month low in Feb/Mar ‘22. Daily & weekly cycles honed that and projected a multi-week (or longer) bottom on Feb 23/24 followed by a quick, sharp rally.
That is unfolding at the same time Gold is fulfilling analysis for an accelerated advance into late-Feb/early-March – presaging the geopolitical tensions that are now unfolding. It also powerfully validates War Cycles projected to begin in late-2021/early-2022 and stretch through 2025. Gold & Silver are expected to set a multi-week peak on March 7 – 11.
How Does This Impact 10, 20 & 40-Year Stock Cycles Colliding in 2022?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.