Stock Indexes Confirming Mid-Aug Peaks; Long Positions Exited.
08/26/22 INSIIDE Track Update – “Stock indices have corrected after surging from July 14 into Aug 16, fulfilling the 1 – 4 week and 1 – 2 month buy signals triggered on the July 14 sell-off (see 7/13/22 Weekly Re-Lay Alert). That peak perpetuated a ~1-month low-low-low-low-(high) Cycle Progression and projects a subsequent peak on Sept 15/16 that would fulfill a ~1-month low-low-low-low-high-(high) Cycle Progression.
From a price perspective, stocks fulfilled the majority of upside price potential for these buy signals with the DJIA peaking right at its final upside target (and profit-taking level for the July 14 buy signal) at 34,200 while almost all the indexes fulfilled their intra-month uptrends by peaking right at monthly resistance/SPRs (34,228/DJIA, 4309/ESU, 13,787/NQU, 2014/QRU & 2640/IDX)…
Corroborating that, the DJTA had a 20-week high-high-(high) Cycle Progression emerging on Aug 15 – 19, when it completed successive advances of 33 days each. It peaked on Aug 16.
All of these cycles were corroborated by the weekly trend action – from different perspectives – in the primary indexes… Stocks precisely fulfilled all of that, peaking on Aug 16 while reaching those upside targets and intra-month resistance zones – a textbook combination of time, price, wave & pattern (trend structure) projections for a multi-week top.
Stocks reversed lower and quickly neutralized their daily & intra-month trends, confirming those peaks, and then turned those trends down – projecting drops into month-end.”
Stock indexes completed the July 14 buy signals – fulfilling projected 3 – 4 week advances into Aug 15/16 and up to primary upside objectives – and triggered a new phase of consolidation. If a subsequent high is set on Sept 12 – 16, it would usher in a bearish phase for stocks in the second half of September ’22.
The DJIA reached its multi-month upside target (~34,200), signaling a likely multi-month peak, as the DJTA & S+P Midcap 400 fulfilled decisive cycle highs that should create multi-month peaks. Most indexes failed to turn their weekly trends up, projecting declines back to their mid-June lows in the coming month(s).
On a broader basis, stocks powerfully fulfilled projections for a decisive peak in early-Jan ’22 followed by a multi-month plunge in the first half of 2022. An overall 4 – 5 month decline was/is expected to follow… ideally bottoming on June 13 – 21! That is when stocks bottomed and produced a 1 – 3 month bottom and their first (upside) reversal signal. July 14 produced the second signal – triggering long positions that precisely fulfilled upside targets in price and time while culminating on Aug 15/16. Consolidation is expected until Sept 12 – 16 ’22, when cycles again turn negative.
How Does Mid-Aug ’22 Cycle Peak Fit with Overall 2022/2023 Outlook?
Why Does DJIA, DJTA, Russell 2000 & S+P Midcap 400 Action Portend New Decline??
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.