Short-term Forecast for February 4, 2020

| February 4, 2020

Stock Market Commentary

A cycle low signal was generated today, indicating that a new short-term cycle has likely begun. We are 2 sessions into the alpha phase rally of the short-term cycle that began on February 3.

The magnitude and duration of the last beta 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 sharply higher today, moving up toward previous highs of the uptrend from October. Technical indicators are slightly bullish overall, tentatively favoring a continuation of the advance.

Cycle Analysis

A cycle low signal was generated today, indicating that the latest short-term cycle low (STCL) likely formed on January 31. We are 2 sessions into the alpha phase rally of the cycle following the STCL on January 31. 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 from March 13 to April 2, with our best estimate being in the March 25 to March 31 range.

  • Last STCL: January 31, 2020
  • Cycle Duration: 2 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: March 13 to April 2; best estimate in the March 25 to March 31 range.
  • Setup Status: Cycle low setup occurred today.
  • Trigger Status: Cycle low trigger occurred today.
  • Signal Status: Cycle low signal was generated today.
  • Stop Level: None active.

Short-term Outlook

  • Bullish Scenario: A close above the previous high at 3,333 would reconfirm the uptrend from August and forecast additional gains.
  • Bearish Scenario: A reversal and close well below the 50-day moving average at 3,218 would reconfirm the downtrend from last week and predict a move down to congestion support in the 3,150 area.

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

Category: Forecasts, Short-term Forecasts


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