Short-term Forecast for October 31, 2016

| October 31, 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 short-term lows of the downtrend from August. Technical indicators are bearish overall, strongly favoring a continuation of the decline.

Cycle Analysis

We are 5 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on October 17. Cycle translation is in question. An extended alpha phase decline that moves below the STCL in September at 2,120 would reconfirm the current bearish translation and favor additional short-term weakness. Alternatively, a quick rebound followed by an extended beta phase rally that moves well above the beta high (BH) in September at 2,186 would signal the likely transition to a bullish translation. The window during which the next STCL is likely to occur is from November 28 to December 16, with our best estimate being in the December 8 to December 14 range.

  • Last STCL: October 17, 2016
  • Cycle Duration: 10 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: November 28 to December 16; best estimate in the December 8 to December 14 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 previous short-term high at 2,190 would reconfirm the uptrend from February and forecast additional gains.
  • Bearish Scenario: A close below the previous short-term low at 2,121 would reconfirm the downtrend from August and predict a return to congestion support at the 2,100 level.

The bearish 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 slightly lower today, holding near recent highs of the uptrend from July. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 6 sessions into the rally phase of the cycle following the short-term cycle high (STCH) on October 12. The magnitude of the current rally phase reconfirms the current bullish translation and favors additional short-term strength. The window during which the next STCH is likely to occur is from November 2 to November 23, with our best estimate being in the November 4 to November 10 range.

  • Last STCH: October 12, 2016
  • Cycle Duration: 13 sessions
  • Cycle Translation: Bullish
  • Next STCH Window: November 2 to November 23; best estimate in the November 4 to November 10 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 recent short-term high at 1.87% would reconfirm the uptrend from July and forecast additional gains.
  • Bearish Scenario: A reversal and close below the middle of the Bollinger bands at 1.76% would predict a move down toward uptrend support near 1.63%.

The bullish 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 near unchanged today, holding below previous highs of the uptrend from August. Technical indicators are slightly bullish overall, tentatively favoring a continuation of the advance.

Cycle Analysis

We are 5 sessions into the beta phase decline of the cycle following the short-term cycle low (STCL) on September 26. The magnitude and duration of the last alpha phase rally reconfirms the current bullish translation and favors additional short-term strength. The window during which the next STCL is likely to occur is now through November 3.

  • Last STCL: September 26, 2016
  • Cycle Duration: 25 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through November 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 close well above the previous short-term high at 98.90 would reconfirm the uptrend from August and forecast additional gains.
  • Bearish Scenario: A close well below the middle of the Bollinger bands at 97.80 would predict a return to uptrend support near 96.27.

The bullish 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 slightly lower today, holding near recent short-term highs above previous lows of the downtrend from August. Technical indicators are neutral to slightly bearish overall, suggesting that direction is in question with a slight downward bias.

We are 5 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on October 24. The quick move above the last beta high (BH) during the current alpha phase rally signals the likely transition to a bullish translation and favors additional short-term weakness. The window during which the next STCL is likely to occur is from November 9 to November 21, with our best estimate being in the November 10 to November 16 range.

  • Last STCL: October 7, 2016
  • Cycle Duration: 5 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: November 9 to November 21; best estimate in the November 10 to November 16 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 recent short-term high at 1,278 would reconfirm the uptrend from early October and predict a move up toward congestion resistance in the 1,310 area.
  • Bearish Scenario: A reversal and close below the previous short-term low at 1,252 would reconfirm the downtrend from August and forecast additional losses.

Both scenarios are equally likely.

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 short-term low below support at the lower boundary of the uptrend from August. Technical indicators are moderately bearish overall, favoring a continuation of the decline from mid-October.

Cycle Analysis

We are 8 sessions into the beta phase decline of the cycle following the short-term cycle low (STCL) on September 27. The magnitude and duration of the last alpha phase rally signals the likely transition to a bullish translation and favors additional short-term strength. The window during which the next STCL is likely to occur is now through November 2.

  • Last STCL: September 27, 2016
  • Cycle Duration: 24 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through November 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 previous short-term high at 51.82 would reconfirm the uptrend from August and forecast additional gains.
  • Bearish Scenario: A close below current levels would predict a move down toward congestion support in the 43 area.

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

Category: Forecasts, Short-term Forecasts


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