Stocks Project Rally into Jan. 20 – 24 Peak & to ~29,300/DJIA & ~3340/ESH; Sharp Sell-off Should Follow!
01/11/20 Weekly Re-Lay: “Stock Indices repeated their month-opening pattern and signaled a new 1 – 2 week rally that could extend beyond mid-month and up to weekly extremes (and monthly resistance).
A multi-month peak is expected after mid-Jan. and should lead to a quick, sharp sell-off into early-Feb. ’20…
Stock Indices have rallied sharply since repeating the early-month patterns of the past several months – spiking sharply lower in the opening days BUT not turning their intra-month or daily trends down. They tested and held weekly HLS levels in the process. The indexes then rallied and turned their intra-month trends up – increasing the potential for an overall rally into the second half of January 2020.
If that occurs, it would mimic how 2018 began – the previous phase of the 2-Year Cycle. In that case (and prior instances), it led to a sharp sell-off into early-Feb.
That is corroborated by the 11 – 12 week cycle that has governed action in the DJ Transports since the Jan. ’18 peak.
The next cycle in that sequence should be a high and comes into play on Jan. 20 – 24 (Jan. 27 – 31, at the latest).
The new intra-month uptrends project additional upside to monthly resistance levels and/or into mid-month. That is intriguing since multiple weekly LHRs converge with monthly resistance levels at 29,211 – 29,255/DJIA, 3304 – 3340/ESH & 9080 – 9156/NQH… and with a primary wave objective.
Since the Aug. ’19 low, the DJIA has rallied in 5 waves – entering its 5th wave (3rd advance) in early-Dec. That low (4th wave of lesser degree at 27,325/DJIA) bottomed right at the 1st wave peak (early-Sept. high of 27,306/DJIA) – a standard Elliott Wave rule for a corrective wave of that nature… and a reinforcement of ‘resistance turned into support’.
In a textbook wave, the 3rd wave (2nd rally) will be the largest and most dynamic of the three advances. So far, that is the case with the early-Oct. – late-Nov. rally being the largest.
When that is the case, the 1st & 5th waves (1st and 3rd rallies) ‘tend toward equality’. They are similar in magnitude.
For the current advance to equal the Aug./Sept. rally (1st wave/advance) it would have to reach 29,292/DJIA… in the midst of monthly resistance.
Stock indexes rallied from their early-month sell-offs and turned their intra-month trends up (the DJIA & DJTA have since neutralized those trends). This should spur rallies to monthly resistance levels, leading into mid-Jan.”
Stock indexes project a new rally into Jan. 20 – 24, ‘20 – the convergence of weekly, monthly & multi-year cycles including an uncanny 2-Year Cycle and the 40-Year Cycle (as well as the 8-Month & 16-Month Cycles). An intermediate peak is expected then and should be followed by a quick, sharp sell-off. The early-Jan. ’20 lows corroborated that scenario and project rallies to 29,211 – 29,292/DJIA & 3307 – 3340/ESH.
What would a Jan. 20 – 24 peak signal for Feb. & March 2020?
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