NFLX Sell Signal Portends ‘C’-Wave (Dynamic) Sell-off in Key Indexes; DJIA Projects Plunge from Mid-July ’19 Peak into Late-Aug. ‘19. Why?
07/17/19 Weekly Re-Lay Alert – “Stock Indices rallied into mid-month, peaking on July 15 and reversing lower. That fulfilled intra-month uptrends and some daily & weekly cycles. The Nasdaq 100 tested and held monthly resistance, while rallying into mid-month, the textbook scenario for an intra-month uptrend. All the indexes have sold off with the DJIA, ESU & NQU neutralizing their daily uptrends on today’s close (while ESU neutralized its intra-month uptrend)…
Both the Transports and Russell 2000 continue to trace out weekly 21 MAC action that is indicative of a ‘b’ wave peak and start of ‘c’ wave decline. Meanwhile, the NYA (NYSE Index) retested its Sept. 18 high and initially peaked just below it. That high is well below its late-Jan ’18 peak, maintaining a sequence of descending tops.
From a little broader perspective, stocks are nearing the time (based on 4-year, 2-year, monthly & weekly cycles) when a significant correction has been forecast. Those cycles project a multi-month low in late-Aug. (possibly stretching into Sept. ’19 in some indexes) with the majority of selling expected in the weeks immediately preceding that cycle low (similar to Dec. ’18 and closely related to the sell-off of Aug. 2015).
Since the 4Q ’18 peak, the DJIA has corroborated that with a consistent 11 – 12 week high (Oct. ’18) – low (Dec. ’18) – low (Mar. ’19) – low (Jun. ’19) Cycle Progression that next comes into play on Aug. 19 – 30 and is more likely to time an intermediate low.
Of added interest, a low in late-Aug. ’19 would arrive 8 months from the late-Dec. ’18 bottom. In many cases, a market in transition (in this case, a topping process that is shifting from the uptrend of 2016 – 2018 and more significantly – the uptrend of 2009 – 2018) will begin to mimic opposing cycles – with prevailing cycle highs starting to govern intervening lows, and vice-versa.
An 8-month cycle has been one of the most consistent cycles for the past few years, helping to pinpoint the Sept. ’18 highs and the recent late-April/early-May ’19 highs (in several stocks and indexes). Those ~4-month rallies into late-April split that ~8-month cycle in half.
Once again, proxy stocks like NFLX (which has given uncanny signals since mid-’18) are acting as the proverbial canary in the coal mine, peaking in early-July while perpetuating a 9-week/~2-month low-high-high-(high) Cycle Progression. If it drops below 353.88 by July 19, it would turn its weekly 21 Low MAC down.
It is in an intra-month downtrend and needs a daily close below 362.30 to turn its daily trend down. A July 19 close below 358.85 would neutralize its intra-year uptrend and provide a more decisive sign of an intermediate peak. All of this action identifies the next two days as being fairly decisive – with the potential to turn daily trends down and signal multi-week highs.”
NFLX again acting as ‘canary in coal mine’, validating July 11/12 sell signal as the Russell 2K and most stocks & indexes projected a mid-July ‘19 peak followed by 4 – 6 week drop. DJ Industrials signaling likely sell-off from mid-July into Aug. 19 – 30 (daily cycles should hone this). 40-Year Cycle & 4-Year Cycle project increasing trouble in/around Aug. ‘19… with a Aug. ’15-style sell-off becoming increasingly more likely! What could trigger August ’19 plunge?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.