Stock Market Cycles: Aug. 26 Low Projects Overall Rally into Nov. 11 – 15; Weekly Trends Project New Highs. What Could Surprise Markets in/After mid-Nov. 2019???
09/30/19 INSIIDE Track: “Outlook 2019/2020 – The ~11-Year Cycle – Part II
09-30-19 – Late-Aug./early-Sept. ’19 ushered in a transition phase on so many levels, its significance should not be underestimated…
For starters, there was the stock market. Since 2017, a primary focus has been on 3Q ’19 – ideally on late-Aug. ’19 – for the culmination of another sharp sell-off. A brief rebound followed.
Leading stocks and stock indexes corroborated that in the first half of July – triggering intermediate sell signals – and were quickly followed by the primary indexes. Combined with some uncanny weekly cycles (see diagrams on page 5), they forecast a sharp drop into late-Aug. and then a rebound into mid-Sept. before another multi-week sell-off.
That was also in sync with the uncanny 4-Year Cycle – continuing to mimic what unfolded in 2015. It also mirrored much of what unfolded in 1979 – one 40-Year Cycle ago…
Then there were precious metals. They surged into late-Aug./early-Sept. with Gold perpetuating an extremely unique web of weekly cycles (~14-week, ~28-week, ~56-week and even ~112-week cycles) that has governed its action since 2011.
That action ushered in what should be a multi-month peak and projected an initial, intermediate sell-off to 1460 – 1470/GC & 16.50 – 16.80/SI.
Overlapping that, Bitcoin & Cryptocurrency – which had already signaled a 3 – 6 month peak in late-June ‘19 – declined into late-August, reinforcing intermediate analysis and cycles.
After a bounce into early-Sept., Bitcoin generated another sell signal and projected a new plunge into late-Sept. and ultimately into late-Oct. ‘19. Its 4th wave of lesser degree (~7,500; the early-June low) is the most decisive level of 3 – 6 month support that must hold, if a new impulse wave is to follow…
Stock Indexes rallied sharply from the fulfillment of multi-week & multi-month cycle lows in late-Aug. ‘19. The latest multi-month bottom took hold on Aug. 26, the latest phase of an ~12 week high (Oct. ’18) – low (Dec ’18) – low (Mar ’19) – low (Jun ’19) – (low) Cycle Progression. An exact 12-week/84-day low (Mar. 11) – low (Jun. 3) – low (Aug. 26) cycle forecast that low to take hold on Aug. 26.
That 12-week/84-day cycle is also the precise one that timed the late-2018 plunge from Oct. 3 into Dec. 26 (84 days). Prior to that, it timed the difference between the late-Jan. ‘18 high and subsequent mid-Apr. ‘18 high (84 days) and the time from that mid-April ‘18 high to the early-Oct. ‘18 peak (168 days).
So, it remains a pivotal cycle… that next comes into play in mid-Nov. ’19.
The late-August low also mimicked the events of the 4-Year Cycle – closely mirroring the action of Aug. 2015. The 2015 low came on Aug. 24, the Monday of the final full week of August, culminating an accelerated ~40-day sell-off originating from a peak on July 16, 2015.
In 2019, primary indexes (DJIA, NYA) also peaked on July 16 and began an accelerated ~40-day sell-off. That bottomed on the Monday (Aug. 26) of the final week of Aug. – along with daily cycles that were projecting a low for Aug. 26/27… with some indexes dropping as much as 10 – 13%.
In 2015, that Aug. 24 low led to a rebound into mid-Sept. before a sizeable sell-off. In 2019, the Aug. 26/27 low was projected to – and ultimately did – trigger a rebound into mid-Sept. followed by another sell-off. Leading into that mid-Sept. peak, two key leading ‘indicators’ triggered new sell signals.
Precursors, Proxies & Parallels
The Aug. ’19 low fulfilled a unique parallel in the DJIA – producing another textbook example of wave equivalence (the next decline should be greater)…
In May/June ‘19, the DJIA sold off for 22 trading days, losing about 2,000 points before encountering intermediate support and bottoming.
In July/Aug ‘19, the DJIA sold off for 22 trading days, losing about 2,000 points before encountering intermediate support and bottoming.
They have also closely adhered to expectations concerning an important precursor index – the DJTA.
The Transports were projected to peak near decisive resistance (11,000 – 11,150/DJTA) during the Sept. 13/16 cycle high. They did that while twice neutralizing their prevailing weekly downtrend – providing the ideal setup for an intermediate peak and a textbook weekly trend sell signal. It projects a sharp drop back to its Aug. ‘19 low in the near future. That could weigh on other indexes.
And the indexes were again led by that uncanny proxy stock, NFLX, again providing advance warning of a reversal lower when it fulfilled analysis for a rebound peak on Sept. 6 – 13 and triggered another 1 – 3 week sell signal. It peaked on Sept. 9 – perpetuating a 9 – 10 week cycle that has timed most of its important swing points.
As detailed last month, a Sept. 6 – 13 NFLX peak would fulfill a 9 – 10 week low-high-high-high-(high) Cycle Progression, a 67-day high (Feb. 25) – high (May 3) – high (July 9) – high (Sept. 13, ‘19) Cycle Progression, a 50% rebound in time and an 18 – 19 week high (7/21/17) – low (12/01/17) – low (4/06/18) – low (8/17/18) – low (12/28/18) – high (5/03/19) – high (Sept. 3 – 13, ‘19) Cycle Progression.
NFLX fulfilled, validated and/or perpetuated all of those, peaking on Sept. 9 and then plunging another ~16% since then. This remains part of a larger-degree decline – since July ’18 – with a multi-year downside target of ~xxx/NFLX.
On a near-term basis, NFLX just spiked to a new intra-year low but did NOT turn its intra-year trend down (it would take a weekly close below 256.58/NFLX to do so). That could lead to a 1 – 2 week rebound from that low, allowing time for the indexes to catch up…
The action of the next two weeks should help clarify what to expect from the next phase of many intermediate cycles – in the first half of Nov. ‘19 (Nov. 11 – 15, ‘19 = greatest synergy).
3 – 5 year equity traders & investors could [reserved for subscribers].”
Stock indexes completing latest sell-offs, expected to stretch into early-Oct. Primary indexes remain in positive weekly trends, forecasting an ultimate rally into Nov. 11 – 15 and to new 2019 highs. How would that impact (reinforce) outlook for Nov. ’19 – March ‘20?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.