Short-term Forecast for January 7, 2020

| January 7, 2020

Stock Market Commentary

We are 24 sessions into the alpha phase rally of the short-term cycle that began on December 3. The alpha high (AH) is overdue and it could form at any time, if it has not already occurred on January 2.

The magnitude and duration of the alpha phase rally reconfirm the current bullish short-term trend and favor additional 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 recent highs of the uptrend from October. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 24 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on December 3. The alpha high (AH) overdue and it could form at any time, if it has not already occurred on January 2. The magnitude and duration of the alpha 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 from January 14 to February 1, with our best estimate being in the January 24 to January 30 range.

  • Last STCL: December 3, 2019
  • Cycle Duration: 24 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: January 14 to February 1; best estimate in the January 24 to January 30 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 3,258 would reconfirm the uptrend from August and forecast additional gains.
  • Bearish Scenario: A reversal and close below uptrend support near 3,215 would predict a move down toward the 50-day moving average at 3,139.

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

Category: Forecasts, Short-term Forecasts


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