Stocks Entering Bearish early-2016 Cycles
12/26/15 Weekly Re-Lay: “Stock Indices have entered the time – immediately after weekly cycles peaked – when a new multi-month decline becomes more of a possibility/probability. 3–6 month & 6–12 month traders should have sold Indices at their early-Nov. highs and be holding these short positions…
Stock Indices continue to mimic the overall action of 2000–2002, when almost every sharp sell-off was quickly met with a contrasting rally and almost every rally was followed by a slightly larger decline… a pattern that masked the evolving bear market until 3Q 2001.
The action of late-2014–late-2016 (potentially extending into 2017) was expected to be similar… not an exact replica, but a generally similar pattern in which a sustained decline (or advance) is never able to take hold. The 2007–2009 decline was the opposite – providing more of a continuous (obvious) decline throughout.
The current market – based on an uncanny 32–33 Week Cycle (as well as many corroborating indicators & cycles) was expected to time a precursor peak in Sept. 2014 and then two subsequent peaks in late-April/early-May & mid-Dec. 2015… with a 15–20% drop in between.
The Indices fulfilled that analysis and are now exiting the latest cycle peak – poised for an overall drop into late-April/early-May 2016… 360 degrees from the 2015 highs. That is when the next significant (though not the final) low is expected in this developing decline.
One of the key validating factors continues to be the weekly trend pattern. In the case of the DJTA, it turned down in late-2014 and has remained that way ever since. In the DJIA, it reversed back up a couple months ago and more recently reversed back down.
As for the S+P, it has remained down throughout the 4Q 2015 advance – reinforcing the likelihood of an ensuing drop to new lows..The Nasdaq 100 remains in a daily downtrend that should spur new selling. …
3–6 month & 6–12 month traders/investors should have re-entered the short side of the Indices (except NQZ) on Oct. 29/30–Nov. 6th and should …” TRADING INVOLVES SUBSTANTIAL RISK.
Stock Indices have fulfilled the mid-December ‘Transition Period’ and analysis detailed in the Oct. 2014 Stock-flation & May 2015 Stock-flation II Reports. As stressed for over a year, the ‘real trouble’ should wait to materialize immediately after mid-Dec. 2015 cycles. Traders & investors should have been selling at the early-Nov. highs and should be preparing for a 2016 sell-off! TRADING INVOLVES SUBSTANTIAL RISK.