Stocks Reinforce 1Q/2Q ’23 Outlook; Surges to ~4300/ES & ~13,800/NQ Very Likely!
02/01/23 Weekly Re-Lay – “Stock Indices are steadily rallying after bottoming in sync with weekly & monthly cycles in early-Jan ’23 – reinforcing the lows set in late-Sept/mid-Oct ‘22.
They remain positive on a 2 – 4 week basis while reinforcing an ongoing bottoming phase since mid-June & late-Sept ’22. That took the form of divergent lows with the strongest indexes bottoming in mid-June and then setting equal or higher lows in late-Sept/mid-Oct ’22. Weaker indexes set lower lows in Sept/Oct ’22.
The next phase of that congestion was forecast for early-Jan ’23 – when another set of higher lows was projected for almost all indexes… followed by new rallies into March ’23. That fulfilled a web of ~16-Week, ~20-Week & ~30-Week Cycle Progressions in diverse indexes – pinpointing the ideal time for the onset of a new 1 – 2 month advance.
The Russell 2000 and S+P Midcap 400 both set double bottoms in late-Sept/mid-Oct ‘22 – bottoming precisely where they had previously bottomed in mid-June ‘22. As a result, they have been in various forms of consolidation for 7+ months – revealing developing underlying strength leading into the time for a new advance – in Jan ‘23.
In the case of the S+P Midcap 400, it is expected to surge to ~2800 in 1Q ‘23 (similar to S+P 500 upside target near 4350/ES).
The Russell 2K could make it up to ~2050 – 2100/QR after it, too, turned bullish in early-Jan ‘23. (That would also be a 50% rebound of its 2021/2022 decline.)
Leading this latest rally has finally been the Nasdaq-100, which spiked to a new multi-month low on Jan 6, ’23 – perfectly fulfilling its ~30-Week Cycle that is again illustrated on this page – and then entered a ~15% surge in the weeks since then. It should ultimately surge to at least ~13,500 – the mid-Aug ‘22 high…
Regardless of near-term action, the overall outlook remains for a strong rally from late-Dec/early-Jan into March ‘23… the latest rally in this larger rebound.
The S+P 500 is still setting up a convergence of upside targets and monthly resistance levels around 4300 – 4350/ES… that could be tested before a ‘B’ wave rally is complete. That is where the mid-Aug ‘22 peak overlaps the July – Oct ‘21 lows (support turned into resistance) and is just below where the monthly 21 MAC is peaking and flattening…
Similarly, the NQ-100 is likely to see a sharp surge toward its mid-Aug ’22 high (~13,800/NQ), which would also represent a doubling of the Oct/Nov ’22 rally and a doubling of the Jan ’23 rally.
They are two examples of potential range-trading in which the NQ-100 traded between 10,400 & 12,100 for most of the past four months and could surge to ~13,800/NQ now that it is breaking out above that range. That would also represent a precise 50% rebound of the 2021/22 sell-off.”
Stock indexes are fulfilling 4-Shadow Signals (triggered in 4Q ’22) that projected new surges in 1Q ’23. Indexes like the Russell 2000 & S+P Midcap 400 are nearing their upside price targets (accomplishing what the DJIA did in 4Q ’22) while the NQ-100 and S+P 500 are projecting higher levels (~13,800/NQ & ~4300/ES) before their advances would have a better chance of peaking.
Those upside targets – and how/when they are reached – should reveal a great deal about what to expect leading into key cycles in late-July/early-Aug ’23.
What Did/Does 4Q ’22 4-Shadow Signal Portend for 1Q ‘23?
How High Could Latest Rallies Reach?
What Would Likely Follow Tests of ~13,800/NQ & ~4300/ES?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.