Short-term Forecast for August 1, 2016

| August 1, 2016

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 near unchanged today, holding near recent highs of the uptrend from February. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 24 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on June 27. The alpha high (AH) is overdue and it could form at any time, if it has not already occurred on July 22. Cycle translation is in question. A quick reversal followed by an extended alpha phase decline that moves below the last STCL at 1,992 would reconfirm the current bearish translation and favor additional short-term weakness. Alternatively, a brief, shallow alpha phase decline followed by an extended beta phase rally that moves well above the developing AH would signal the likely transition to a bullish translation. The window during which the next STCL is likely to occur is from August 5 to August 26, with our best estimate being in the August 22 to August 26 range.

  • Last STCL: June 27, 2016
  • Cycle Duration: 24 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: August 5 to August 26; best estimate in the August 22 to August 26 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 close well above the recent short-term high at 2,175 would reconfirm the uptrend from February and forecast additional gains.
  • Bearish Scenario: A reversal and close below congestion support at the 2,100 level would predict a move down toward congestion support in the 2,000 area.

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

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 higher today, moving up toward recent short-term highs above previous lows of the downtrend from 2015. Technical indicators are slightly bearish overall, tentatively favoring a return to previous lows of the decline.

Cycle Analysis

We are 8 sessions into the decline phase of the cycle following the short-term cycle high (STCH) on July 21. The magnitude and duration of the previous decline phase reconfirms the current bearish translation and favors additional short-term weakness. The window during which the next STCH is likely to occur is from August 10 to August 31, with our best estimate being in the August 16 to August 22 range.

  • Last STCH: July 21, 2016
  • Cycle Duration: 8 sessions
  • Cycle Translation: Bearish
  • Next STCH Window: August 10 to August 31; best estimate in the August 16 to August 22 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 previous short-term high at 1.60% would predict a move up toward congestion resistance in the 1.70% area.
  • Bearish Scenario: A close below the previous short-term low at 1.34% would reconfirm the downtrend from 2015 and forecast additional losses.

The bearish scenario is slightly more likely (~60% 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 slightly higher today, reacting off of recent short-term lows below previous highs of the uptrend from May. Technical indicators are slightly bearish overall, tentatively favoring a move down toward previous lows of the downtrend from 2015.

Cycle Analysis

We are 6 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on July 14. The magnitude and duration of the current alpha phase decline suggests that cycle translation is in question. A quick rebound followed by an extended beta phase rally that moves above the last alpha high (AH) at 97.52 would reconfirm the current bullish translation and favor additional short-term strength. Alternatively, an extended alpha phase decline that moves well below the last STCL at 95.84 would signal the likely transition to a bearish translation. The window during which the next STCL is likely to occur is from August 10 to August 24, with our best estimate being in the August 12 to August 18 range.

  • Last STCL: July 14, 2016
  • Cycle Duration: 12 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: August 10 to August 24; best estimate in the August 12 to August 18 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 previous short-term high at 97.52 would reconfirm the uptrend from early May and forecast additional gains.
  • Bearish Scenario: A close below the recent short-term low at 95.49 would predict a move down toward congestion support in the 93.50 area.

The bearish scenario is slightly more likely (~60% 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 slightly higher today, holding near previous highs of the uptrend from December. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

We are 5 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on July 26. An extended alpha phase rally that moves above the last beta high (BH) at 1,369 would reconfirm the current bullish translation and favor additional short-term strength. Alternatively, a quick reversal followed by an extended alpha phase decline that moves well below the last STCL at 1,315 would signal the likely transition to a bearish translation. The window during which the next STCL is likely to occur is from August 10 to August 22, with our best estimate being in the August 11 to August 17 range.

  • Last STCL: July 26, 2016
  • Cycle Duration: 5 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: August 10 to August 22; best estimate in the August 11 to August 17 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 close above the previous short-term high at 1,369 would reconfirm the uptrend from December and forecast additional gains.
  • Bearish Scenario: A reversal and close well below uptrend support near 1,325 would predict a move down toward congestion support in the 1,215 area.

The bullish scenario is more likely (~70% 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 sharply lower today, moving down to a new low for the downtrend from June. Technical indicators are extremely bearish overall, strongly favoring a continuation of the decline.

Cycle Analysis

We are 10 sessions into the beta phase decline of the cycle following the short-term cycle low (STCL) on June 27. The magnitude and duration of the current beta 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 August 3.

  • Last STCL: June 27, 2016
  • Cycle Duration: 23 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: Now through August 3.
  • 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 middle of the Bollinger bands at 44.50 would predict a move up toward the previous short-term high at 51.45.
  • Bearish Scenario: A close below current levels would reconfirm the downtrend from June and forecast additional losses.

The bearish scenario is highly likely (>80% probable).

Category: Forecasts, Short-term Forecasts


Comments are closed.