Stocks Reinforce Projected Drop into Mid-December; Downside Targets in Focus.
Stocks Reinforce Projected Drop into Mid-December; Downside Targets in Focus.
11/21/18 Recap –
11/14/18 Weekly Re-Lay Alert: Stock Indices extended their latest declines long enough to turn the daily trends back down. That reduces the potential for new rebound highs (above last week’s highs) during the DJIA cycle highs on Nov. 19 – 23. Instead, that cycle could set a lower high.
In contrast, the daily trend reversals powerfully corroborate the outlook in the Nasdaq 100. That Index was expected to set its rebound peak in sync with weekly cycles (5-week high-high-high-high & 10-week low-high-high-high Cycle Progressions) that converged on Nov. 5 – 9 and begin a new decline from there.
It peaked on Nov. 7/8 and did it precisely at its upside target range (7210 – 7261/NQZ) while simultaneously testing and holding its weekly resistance, weekly trend point and descending weekly 21 Low MAC. That Index was projected to experience a deeper sell-off into this week, which is what has taken place…
From a slightly larger perspective, this action is corroborating the weekly trend patterns and the 4Q 2018 outlook. That should be kept in context. Equities were expected to see October plunges and, once they had turned their weekly trends down, a reactive 1 – 3 week bounce before a new decline took hold.
This action necessitates a repeat of what was emphasized in the Nov. 7 INSIIDE Track Stock Index Update. With the NQZ reaching its upside targets during its Nov. 5 – 9 cycle high, and the DJIA rebounding 76% of its October plunge (78.6% is often the extreme for a ‘2’ or ‘B’ wave retracement), equities had already expended most of their upside potential in price…
As long as the Nov. 8 high holds in the Nasdaq 100, the next intermediate low should be seen on Dec. 10 – 14 (the next phase of that 5-week high-high-high-high-(low) Cycle Progression). Price objectives [reserved for subscribers].”
11/15/18 INSIIDE Track Stock Index Update: Stock Indices entered a new rebound immediately after turning their daily trends back down. That is a textbook pattern since that lagging/confirming indicator usually signals the end of the first leg (in this case, a decline) while looking ahead to a future decline after an intervening bounce. In Elliottt Wave terminology, it signals the culmination of a ‘1’ or ‘a’ wave move – letting a trader know that a ‘3’ or ‘c’ wave decline is on the horizon…
For now, the outlook has not changed for equities, looking for a low on Oct. 29, a sharp rebound into Nov. 5 – 9, a sell-off into this week and then another bounce into next week. That should set the stage for a new decline into December.”
Stocks remain on track for an overall decline – from their late-Sept./early-Oct. highs into cycle lows in mid-Dec. Downside targets are coming into focus and expected to be reached by then (watch the days surrounding Dec. 14). The action of late-Sept. – early-Nov. ’18 continues to reinforce expectations for late-2018/early-2019.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.