Stocks Fulfilling 4-Shadow Sell Signal; On Track for Drop into ~March 23, ’20!
03/11/20 INSIIDE Track Stock Index Update: “Stock Indexes continue to swing wildly with the ESM & NQM (S+P & Nasdaq 100 futures) and the DJTA trading in roughly the same ranges each of the past three days, while vacillating uncontrollably.
In the case of the ESM & NQM, today was an inside day (lower high and higher low than yesterday) – a ‘non-event’ by technical analysis standards. (Obviously, none of these days are ‘non-events’! I am merely referring to the standard technical interpretation of an inside day.)
The indexes remain negative and would not even turn neutral – on a 1 – 2 week basis – until daily closes above 25,560/DJIA, 2910/ESM & 8420/NQM…
From an even larger perspective, the indexes have initially fulfilled some key objectives for this decline. Throughout the past couple months, the latest 40-Year Cycle parallel has been discussed repeatedly (stocks have continued to produce amazingly close parallels to 1978 – 1980 throughout 2018 – 2020) and explained how stocks surged to new multi-year highs in early-1980 – peaking on Feb. 12/13, 1980. The Indexes then suffered a sharp 8 – 10% drop into late-Feb. and an overall 20% plunge into March 1980.
Due to an ominous collision of multiple bearish cycles and indicators, Feb./March 2020 was projected to see something similar – with a myriad of factors projecting a final peak on Feb. 12 – 17 followed by a sharp drop into Feb. 26 – 28 and an overall plunge into late-March. The DJIA peaked on Feb. 12/13, 2020 and then suffered a sharp 8 – 10% drop into late-Feb. and an overall 20% plunge into March 2020. Déjà vu??
Does anyone still doubt the validity of the 40-Year Cycle? Or the 2-Year Cycle?? Or the 4-Shadow Sell Signal???
Another parallel – and one of the converging ‘fronts’ in the early-Feb. Perfect Storm of negative signals – was the uncanny similarity to late-Sept. 2018 – with regard to the FAANG stocks artificially supporting the rest of the market. In 4Q ’18, that led to a quick, sharp 20% plunge. In 1Q ’20, the FAANG stocks were artificially supporting the rest of the market and that led to a quick, sharp 20% plunge. Déjà vu… all over again??
…the markets have not produced any signals of a reversal higher yet so these downtrends need to be respected. There is a BIG difference between fulfilling primary downside objectives… and actually signaling a low (since markets can always extend declines and head for a secondary set of downside targets).”
Stocks powerfully confirming multi-year cycles, multi-month cycles (3 – 6 month DJTA peak in late-Jan.), multi-week cycles (peak in late-Jan. followed by 6 – 8 week drop) and the ultimate late-Jan/early-Feb. Perfect Storm of intermediate sell signals – triggered on Feb. 7 – 14 and projecting an overall plunge into late-March ’20 – when a multi-month bottom is most likely.
These damaging signals reinforce the 40-Year Cycle and 2-Year Cycle outlook for another plunge into March 23, 2020 – the precise time that equities bottomed in 2018 AND 1980.
What Would Signal Multi-Month Bottom?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.