Stocks Project Accelerated Decline… DJ Transports Portend Quick Plunge to Late-Aug. Low. NFLX Fulfills Sept. 9 Sell Signal (‘Canary in Coal Mine’).
09/28/19 Weekly Re-Lay: “Stock Indices sold off into late-Sept., following the lead of the DJTA and NFLX – both of which corroborated cycle highs on Sept. 13/16. The coming week, and particularly the next two trading days, could have a powerful influence on what equities are likely to do between now and mid-Nov. – when a web of weekly cycles converge…
Stock Indices are mired in a 3 – 4 month trading range near their intra-year highs, adhering to daily cycles as they swing from high to low and back again. They fulfilled intermediate cycle lows on Aug. 26/27 (daily & weekly cycles) and then rallied into Sept. 13/16 (daily cycle highs & the intra-month trend targets) before turning back down.
They peaked just below monthly resistance, a textbook setup for an intra-month reversal, and have since declined. This also mirrored what transpired in Sept. 2015 – another affirmation of the intriguing influence of this 4-Year Cycle.
Leading that reversal back down was an uncanny proxy stock (NFLX; projected to peak on Sept. 6 – 13 & then resume its overall decline) and precursor index (DJTA; remaining in a negative weekly trend structure and peaking precisely at resistance while triggering a weekly trend sell signal).
The Transports are projecting a drop back to their late-Aug. low… All the indexes confirmed Sept. 13/16 as a multi-week peak, reinforced with the S+P 500 turning its daily trend down on Sept. 24 (right after the DJTA did the same thing on Sept. 23). Those trend reversals projected subsequent 1 – 3 day reactive bounces, fulfilled when the indexes rebounded into Sept. 27 and then turned back down.
At the very least, the combination of these divergent daily trend patterns – as well as the intra-month trend pattern – projects some additional selling to begin the coming week…”
Stock indexes confirm mid-Sept. intermediate reversal signals. Bounce into Sept. 26/27 portends new sell-off into early-Oct. DJ Transports reinforce Sept. 13 weekly sell signal and increase likelihood for quick plunge back to late-Aug. low. How low could other indexes drop before an intermediate bottom becomes likely?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.