Short-term Forecast for October 2, 2019

| October 2, 2019

Stock Market Commentary

We are 14 sessions into the beta phase decline of the short-term cycle that began in early August.

An extended beta phase decline that moves below the last short-term cycle low (STCL) at 2,840 would reconfirm the current bearish trend and favor additional short-term weakness. Alternatively, a quick rebound followed by a move up to new highs would signal the likely transition to a bullish short-term trend.

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 sharply lower today, moving down to a new short-term low below previous highs of the uptrend from June. Technical indicators are bearish overall, strongly favoring a continuation of the decline from September.

Cycle Analysis

We are 14 sessions into the beta phase decline of the cycle following the short-term cycle low (STCL) on August 5. An extended beta phase decline that moves below the last STCL at 2,840 would reconfirm the current bearish translation and favor additional short-term weakness. Alternatively, a quick rebound followed by a move up to new highs would signal the likely transition to a bullish translation. The window during which the next STCL is likely to occur is now through October 4.

  • Last STCL: August 5, 2019
  • Cycle Duration: 41 sessions
  • Cycle Translation: Bearish
  • Next STCL Window: Now through October 4.
  • 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 middle of the Bollinger bands at 2,981 would predict a return to the previous long-term high at 3,026.
  • Bearish Scenario: A close below current levels would predict a move down toward congestion support at the 2,850 level.

The bearish scenario is more likely (~70 probable).

Category: Forecasts, Short-term Forecasts


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