Short-term Forecast for October 15, 2018

| October 15, 2018

Stock Market Commentary

We are 17 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, if it has not already occurred on October 11.

The magnitude and duration of the current beta phase decline signal the likely transition to a bearish trend and favor additional weakness during the next short-term cycle.

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, moving down toward recent short-term lows of the violent downtrend from last week and continuing a test of support at the 200-day moving average. Technical indicators are bearish overall, strongly favoring a continuation of the decline.

Cycle Analysis

We are 17 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 current beta phase decline signal the likely transition to a bearish translation and favor additional short-term weakness. The window during which the next STCL is likely to occur is now through October 16. The latest STCL may have formed on October 11, although we would need to see additional strength to confirm that development.

  • Last STCL: August 15, 2018
  • Cycle Duration: 42 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: Now through October 16.
  • 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 below the recent short-term low at 2,728 would predict a return to congestion support in the 2,700 area.

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

Category: Forecasts, Short-term Forecasts


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