Stocks Rebound After Sell-off

Stocks Rebound After Sell-off;
Sept. 23rd = Potential High;
Weekly Trend Pattern = Key.

09/21/16 Weekly Re-Lay Alert – Danger Period #1 Evolving – II: 

Stock Indices are in the midst of the first of two anticipated ‘Danger Periods’, following the latest phase of the 32–33 Week AND 66-Week Cycles

As early validation to that scenario, the Indices were expected to set a secondary high on Sept. 7th and see a quick, sharp drop into Sept. 14th.  That Sept. 7–14th decline transpired & created corroborating short-term cycles focused on late-Sept./early-Oct.  The weekly trend patterns are set up to corroborate that…

The current week provides the first potential for the DJIA & ESZ to [See complete 9/21/16 Weekly Re-Lay Alert for detailed analysis].

If that occurs on Sept. 23rd, it would reinforce the likelihood for an initial low in late-Sept…In the interim, the daily trend patterns are being used to validate and/or time the potential for a new 1–2 week drop.  In the case of the DJIA, the daily trend turned from down to neutral – potentially extending this bounce by a day or two (beyond mid-week).

Those daily trends – in the DJIA, DJTA, NYSE, MMX, IUX (Russell 2000) & ESZ – cannot reverse back to up until Sept. 23rdor 26th, at the earliest.  That often pinpoints the timing for a rebound peak (if/when the daily trend is NOT going to reverse back to up).

The S+P 500 (ESZ) is providing an intriguing daily Cycle Progression that could corroborate the daily trend pattern.  It is an 11 trading-day high (July 25)–high (Aug. 9)–high (Aug. 23)–high (Sept. 8)–high (Sept. 23rdCycle Progression.

An overriding 21–22 trading day high (June 24)–high (July 25)–high (Aug. 23)–high (Sept. 22/23rdCycle Progressionprovides the same conclusion… which is also an approximate ~30-degree cycle.

From a price perspective, the Indices have almost made it up to weekly resistance levels where an intra-week top is most likely.

That resistance – which begins near 18,300/DJIA – coincides with the low of the month-opening range, intra-month support turned into resistance.  Corroborating that, ~18,330/DJIA is a 50% rebound of the overall decline and a .618 rebound of the intra-month decline.

1–3 month & 3–6 month traders & investors should have sold Stock Indices on Aug. 29–Sept. 7th (~18,400–18,550/DJIA, ~2161–2182/ESZ & ~4775–4830/NQZ) and be holding these.  Risk/exit on [See complete 9/21/16 Weekly Re-Lay Alert for comprehensive trading strategy].  TRADING INVOLVES SUBSTANTIAL RISK.”

 

Stocks have bounced/consolidated since selling off into Sept. 14th.  That reinforces expectations for overlapping ‘Danger Periods’ following the mid-August peak.  It could also corroborate longer-term analysis for a 1–2 year topping process to transition – in late-2016 (when monthly 21 MAC could flatten & turn down) – into a 1–2 year bear market.   Nov. 2016 poised to be volatile time as conflicting cycles collide.  Watch days surrounding Nov. 18th (see 9/14/16 Alert for details).