Stocks Pull Back to Begin Month; Could Rally into Mid-January (or Later).
01/03/24 – “January 2 – 4, 2024 marks the opening range of the month, as well as the opening days (though not the complete opening range) of the quarter and year. As such, there are certain expectations surrounding these opening days (see page 2 for a couple of those) and what occurs after them.
As repeatedly warned, many markets will start a new period with a ‘head fake’ during the opening range. In those cases, it is a false move to lure in unsuspecting traders… before a market heads the opposite direction. That opposite direction could last into mid-period (in this case, mid-January) or into the end of the period.
The key – in the case of a new intra-month trend – is to see whether a market gives a daily close above or below the trading range of the first three trading days.
Since that is the established trigger point, it is not unusual that a false move would only last 2 – 4 days since a new intra-month trend signal cannot be generated until the 4th trading day of a new month… at the very earliest (since it needs to close above/below the first 3 trading days).
With the start of a new quarter and new year, the initial moves take on heightened significance. As a result, the next 2 – 3 trading days should be pivotal… one way or the other.
Stock Indices are a perfect example, having sold off in the opening days of January after the NQ-100 (and others) fulfilled its ~2-month cycle and surge from October 26/27th into December 27th…
To reiterate, stocks had been forecast to undergo an overall rally from late-October ’23 into January ’24 – when a more significant top was/is expected.
A high in January ’24 would fulfill their late-October buy signals, a myriad of daily & weekly cycles, and the latest phase of an uncanny ~24-Month/~2-Year Cycle.
In 2017/18, stocks rallied strongly from Oct ’17 into Jan ’18.
In 2019/20, stocks rallied strongly from Oct ’19 into Jan ’20.
In 2021/22, stocks rallied strongly from Oct ’21 into Jan ’22.
And in 2023/24, stocks began a strong rally in October ’23 and extended it into Jan ‘24.
A high at any point in January ‘24 would perpetuate a ~24-month low (Jan/ Feb ’14) – low (Jan/Feb ’16) – high (Jan ’18) – high (Jan/Feb ’20) – high (Jan ’22) – (high; January 2024) Cycle Progression.”
Stock Indexes fulfilled the projected 4Q 2023 advance, stemming from the intermediate buy signals generated after they fulfilled downside price & timing objectives on Oct 27/30, 2023. Additional highs are still likely in January 2024 in order to fulfill the latest phase of the uncanny 2-Year Cycle. Some volatile consolidation is likely before a subsequent rally into the middle half of January. Watch January 22nd in the DJIA.
How High Could Projected Surge into January ‘24 Reach?
Why Would That Set the Stage for 1Q/2Q 2024?
What is in Store for 2024/2025?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.