Short-term Forecast for October 2, 2018

| October 2, 2018

Stock Market Commentary

We are 8 sessions into the beta phase decline of the short-term cycle from August. The latest short-term cycle low (STCL) may have formed on September 28, although we would need to see additional strength to confirm that development.

The magnitude and duration of the last beta phase rally reconfirm the current bullish trend and favor additional short-term strength.

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.

Technical Analysis

The index closed slightly lower today, holding below previous long-term highs and continuing a test of support at the lower boundary of the uptrend from April. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 8 sessions into the beta phase decline of the cycle following the short-term cycle low (STCL) on August 15. The magnitude and duration of the last beta phase rally reconfirm the current bullish translation and favor additional short-term strength. The window during which the next STCL is likely to occur is now through October 16, with our best estimate now through October 5. The latest STCL may have formed on September 28, although we would need to see additional strength to confirm that development.

  • Last STCL: August 15, 2018
  • Cycle Duration: 33 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through October 16; best estimate now through October 5.
  • 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 2,937 would reconfirm the uptrend from April and forecast additional gains.
  • Bearish Scenario: A close well below the middle of the Bollinger bands at 2,904 would predict a move down toward congestion support in the 2,800 area.

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

Category: Forecasts, Short-term Forecasts


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