Short-term Forecast for September 25, 2013

| September 25, 2013

S&P 500 Index Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the S&P 500 index. For intermediate-term outlooks see the latest intermediate-term forecast and for long-term outlooks see the latest long-term forecast.

Technical Analysis

The index closed moderately lower today, retreating further from recent long-term highs of the cyclical bull market from 2009 and moving down toward support at the 50-day moving average. Technical indicators are neutral to slightly bullish overall, suggesting that direction is in question with a slight upward bias.

Cycle Analysis

We are 5 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on August 27. A quick rebound followed by an extended beta phase rally of more than 7 sessions in duration that moves well above the last alpha high (AH) near 1,730 would reconfirm the current bullish translation and favor additional short-term strength. Alternatively, an extended alpha phase decline of more than 8 sessions in duration that approaches the last STCL near 1,630 would suggest that cycle translation is in question. The window during which the next STCL is likely to occur is from October 8 to October 28, with our best estimate being in the October 18 to October 24 range.

  • Last STCL: August 27, 2013
  • Cycle Duration: 20 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: October 8 to October 28; best estimate in the October 18 to October 24 range.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A rebound and close well above the recent high near 1,727 would reconfirm the cyclical bull market from 2009 and forecast additional gains.
  • Bearish Scenario: A close below the 50-day moving average near 1,680 would predict a move down to uptrend support near 1,655.

Both scenarios are equally likely.

US 10-year Treasury Note Yield Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the 10-year Treasury note yield. For intermediate-term outlooks see the latest intermediate-term forecast and for long-term outlooks see the latest long-term forecast.

Technical Analysis

Yields closed moderately lower today, retreating further from recent highs of the uptrend from May below the congestion zone in the 2.71% area. Technical indicators are bearish overall, strongly favoring a continuation of the decline from early September.

Cycle Analysis

We are 11 sessions into the decline phase of the cycle following the short-term cycle high (STCH) on September 10. The magnitude and duration of the decline phase signals the likely transition to a bearish translation and favors additional short-term weakness. The window during which the next STCH is likely to occur is from October 1 to October 22, with our best estimate being in the October 7 to October 11 range.

  • Last STCH: September 10, 2013
  • Cycle Duration: 11 sessions
  • Cycle Translation: Bearish
  • Next STCH Window: October 1 to October 22; best estimate in the October 7 to October 11 range.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A rebound and close above the recent short-term high near 2.98% would reconfirm the uptrend from May and forecast additional gains.
  • Bearish Scenario: A close below current levels would reconfirm the downtrend from early September and predict a return to congestion support at the 2.48% level.

The bearish scenario is more likely (~70% probable).

US Dollar Index Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the US dollar index. For intermediate-term outlooks see the latest intermediate-term forecast and for long-term outlooks see the latest long-term forecast.

Technical Analysis

The index closed moderately lower today, moving down toward recent lows of the downtrend from July. Technical indicators are bearish overall, strongly favoring a continuation of the decline.

Cycle Analysis

A cycle high signal was nearly generated today, indicating that the beta high (BH) likely formed on September 24. We are 1 session into the beta phase decline of the cycle following the short-term cycle low (STCL) on August 20. The move well below the last STCL during the alpha phase decline reconfirms the current bearish translation and favors additional short-term weakness. The window during which the next STCL is likely to occur is now through October 2.

  • Last STCL: August 20, 2013
  • Cycle Duration: 25 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: Now through October 2.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A rebound and close above the middle of the Bollinger bands at 81.43 would predict a move up toward the previous short-term high at 82.67.
  • Bearish Scenario: A close below the recent short-term low at 80.23 would reconfirm the downtrend from July and forecast additional losses.

The bearish scenario is more likely (~70% probable).

Gold Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the gold market. For intermediate-term outlooks see the latest intermediate-term forecast and for long-term outlooks see the latest long-term forecast.

Technical Analysis

Gold closed moderately higher today, reacting off of recent short-term lows below previous highs of the uptrend from June. Technical indicators are slightly bearish overall, tentatively favoring a continuation of the decline from August.

Cycle Analysis

A cycle low signal was nearly generated today, indicating that the beta low (BL) likely formed on September 24. We are 1 session into the beta phase rally of the cycle following the short-term cycle low (STCL) on September 18. Cycle translation is in question. A quick reversal followed by an extended beta phase decline of more than 4 sessions in duration that moves below the last STCL near 1,292 would reconfirm the current bearish translation and favor additional short-term weakness. Alternatively, an extended beta phase rally of more than 4 sessions in duration that moves well above the last alpha high (AH) near 1,375 would signal the likely transition to a bullish translation. The window during which the next STCL is likely to occur is from October 3 to October 15, with our best estimate being in the October 3 to October 9 range.

  • Last STCL: September 18, 2013
  • Cycle Duration: 6 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: October 3 to October 15; best estimate in the October 3 to October 9 range.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A rebound and close above the recent short-term high near 1,418 would reconfirm the uptrend from June and forecast a move up to congestion resistance in the 1,475 area.
  • Bearish Scenario: A close below the recent short-term low near 1,310 would predict a move down to congestion support in the 1,275 area.

The bearish scenario is slightly more likely (~60% probable).

Gold Currency Index Daily Chart Analysis

The Gold Currency Index (GCI) is a composite of gold prices in the currencies of 10 of the largest economies in the world as defined by GDP. It is therefore currency independent, reflecting the intrinsic value of gold as an international currency itself.

Technical Analysis

The GCI closed slightly higher today, reacting off of recent short-term lows below previous highs of the uptrend from June. Technical indicators are slightly bearish overall, tentatively favoring a continuation of the decline from August.

Short-term Outlook

  • Bullish Scenario: A rebound and close above the middle of the Bollinger bands at 35.15 would predict a return to congestion resistance in the 37.50 area.
  • Bearish Scenario: A close below the recent short-term low at 33.78 would forecast a move down toward the previous low of the downtrend from October at 31.15.

The bearish scenario is slightly more likely (~60% probable).

Oil Daily Chart Analyses

The following technical and cycle analyses provide short-term forecasts for the oil market. For intermediate-term outlooks see the latest intermediate-term forecast and for long-term outlooks see the latest long-term forecast.

Technical Analysis

Oil closed moderately lower today, moving down to a new short-term low below support at the lower boundary of the uptrend from April. Technical indicators are bearish overall, strongly favoring a continuation of the decline from early September.

Cycle Analysis

We are 5 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on September 17. The beta low (BL) is imminent and it could form at any time. The move below the last STCL during the alpha phase decline signals the likely transition to a bearish translation. The window during which the next STCL is likely to occur is from October 4 to October 18, with our best estimate being in the October 9 to October 15 range.

  • Last STCL: September 17, 2013
  • Cycle Duration: 6 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: October 4 to October 18; best estimate in the October 9 to October 15 range.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A rebound and close above the recent high at 110.31 would reconfirm the uptrend from April and forecast additional gains.
  • Bearish Scenario: A close below current levels would reconfirm the downtrend from early September and predict a move down toward congestion support in the 98 area.

The bearish scenario is more likely (~70% probable).

Category: Forecasts, Short-term Forecasts


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