Short-term Forecast for October 4, 2018

| October 4, 2018

Stock Market Commentary

We are 10 sessions into the beta phase decline of the short-term cycle from August. The latest short-term cycle low (STCL) is imminent and it could form at any time.

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 moderately lower today, retreating from previous long-term highs and breaking well below support at the lower boundary of the uptrend from April. Technical indicators are neutral to slightly bullish overall, suggesting that direction is in question with a slight upward bias.

Cycle Analysis

We are 10 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 10.

  • Last STCL: August 15, 2018
  • Cycle Duration: 35 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through October 16; best estimate now through October 10.
  • 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 2,937 would reconfirm the uptrend from April and forecast additional gains.
  • Bearish Scenario: A close well below the 50-day moving average at 2,876 would predict a move down toward congestion support in the 2,800 area.

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

Category: Forecasts, Short-term Forecasts


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