Stocks Nearing Major Upside Targets During January/February ’24 Cycles.
01/24/24 – “Inflation continues to be a driving force behind most of the markets, triggering abrupt reversals or violent swings when unexpected data emerges. One of the key gauges of commodity inflation – described for several years in these publications – is the Goldman Sachs Commodity Index (pictured above).
With its heavier weighting in energy markets, the GSCI often mimics the movement in Crude Oil… but there is enough of a divergence (caused by the inclusion of many other commodities) that each is worth analyzing separately. Only after that has been done should similarities be examined.
As detailed in early-December 2023, the GSCI – AND Crude Oil – were both forecast to bottom on December 11 – 15, ’23, when a myriad of cycles converged. The GSCI was projected to retest and briefly spike below its March, May & June ’23 lows before setting a bottom…
The GSCI and Crude did bottom in perfect lockstep with those cycle lows in mid-December, shortly after Gold & Silver had surged into early-December cycle highs – setting multi-month highs.
In the process, the GSCI precisely held (again) range-trading support – projecting a rebound back toward 572/GNX – the midpoint of its latest range. That is where that index found support in August & October ’23 and – after breaking below it – found resistance in Nov. ’23… creating a level that is also 4th wave of lesser degree resistance (the high just before the final decline).
The GSCI is likely to also find monthly 21 Low MAC resistance (in February) and weekly 21 High MAC resistance (in coming weeks) near 572 – creating a key level where a rebound peak could take hold. That could usher in the next phase of a deflationary cycle – leading into July 2024, when a bottom is most likely.
In the interim, other markets could provide corroborating trends and signals in both directions…
Stock Indices continue to show divergence… To reiterate from recent weeks, the January 26th weekly close could be decisive based on the year-opening range and the initial intra-year trends.
The opening range (first three weeks of the new year) for 2024 has been set. It would now take a weekly close – above or below the range of January 2 – 19th – to determine the new intra-year trend. With reinforcing cycle highs also coming into play, the January 26th close should reveal if a top is forming.
On a short-term basis, the DJTA, S+P Midcap 400 & Russell 2000 spiked up to their weekly LHR levels (extreme upside targets for this week) with the Midcap & Russell twice neutralizing their daily downtrends while spiking up to daily 21 MAC resistance and their month-opening ranges…
Currently, their daily trend patterns are projecting a retest of their Jan 17th lows. If that occurs, it would give a second chance for the weekly trends to turn down (and remove the potential for a retest of the highs).
All of that intensifies the focus on the next two trading days and where the indexes close on January 26th. With monthly cycle & 2-Year Cycle peaks being fulfilled in January 2024, stock indexes have entered a pivotal time…”
Stock Indexes are widening divergence among the various indexes. Additional highs are still likely in some indexes in January 2024 – potentially leading to a divergent high in February 2024 while fulfilling the latest phase of the uncanny 2-Year Cycle in January/February 2024.
The DJIA is projected to surge to (potentially above) 39,100 as the S+P 500 and NQ-100 attack their respective 1 – 2 year upside targets (stemming from multi-year bottoming signals in late-2022).
When Will DJIA, S+P & NQ-100 Likely Reach Major Upside Targets?
What Would Signal a Multi-Week Peak? …a Multi-Month Peak??
Why is April/May 2024 Pivotal for Stocks?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.