Why Stocks Should Extend Rallies into Early-Feb.; How High Could They Reach?
Why Stocks Should Extend Rallies into Early-Feb.; How High Could They Reach?
01/19/19 Weekly Re-Lay – “Stock Indices extended their rallies and fulfilled initial upside targets after bottoming in late-Dec. while reaching 2 – 3 month and 6 – 12 month downside price targets. They pulled back to begin last week, ushering in the time for a new rally even sooner. That reinforced the potential for another surge that could take equities up to monthly resistance levels and weekly extreme upside targets…
Most indexes initially peaked on Jan. 9/10 and pulled back into Jan. 14 before resuming their advances. As a result, their Jan. 17 pullback low was of one lesser degree – ushering in another brief but bullish period from Jan. 17 into ~Jan. 24.
As stated previously, those primary upside targets needed to be exceeded – and the Oct. lows violated – in order to confirm that the late-Dec. low was of a higher magnitude than any other bottom of the past 3 – 4 months. If the indexes closed above those levels – and confirmed that scenario – they could surge to a combination of extreme upside targets – near 25,400/DJIA, 2760/ESH & 7100/NQH.
Leading into last week (and now corroborated with intra-week indicators for the coming week), 25,324 – 25,462/DJIA, 2755 – 2765/ESH & 7104 – 7173/NQH incorporated 3 of the latest 5 weekly LHRs, the monthly SPR for Jan. 2019, and now also includes the projected levels for the weekly 21 High MACs in the coming week. A rally to those levels (now more likely) would also match the magnitude of the entire April – Sept. rallies in each of the indexes.
That scenario was corroborated by the weekly trends turning neutral… that signal would allow for this advance to extend into early-Feb.… A peak in the next two weeks would arrive ~1-year/360-degree cycle from the late-Jan. ’18 peaks as well as during corroborating ~6-month & ~4-month high – high cycles that are most evident in global indices.
If a final high stretches into Jan. 30 – Feb. 4, it would also perpetuate a ~60-degree high-high-high-(high) Cycle Progression that includes the late-Sept./early-Oct. & early-Dec. ’18 highs.
Stock indexes remain positive – in both daily & intra-month uptrends – and would not show any signs of near-term tops until daily closes below 24,015/DJIA, 2588/ESH & 6582/NQH.”
Stocks complete initial 1 – 2 week rally and prepare for second one. This overall advance could/should last into early-Feb. when multiple weekly, monthly and annual cycles converge. Jan. 17 ushered in next bullish phase with DJIA expected to approach 25,300 and Nasdaq 100 to attack 7100/NQH in coming weeks. Weekly trends, which could provide powerful confirming signal as soon as Feb. 1, are key to 1Q 2019 outlook. Equities are already revealing what to expect after early-Feb. (potential) peak.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.