Short-term Forecast for February 24, 2020

| February 24, 2020

Stock Market Commentary

We are 3 sessions into the alpha phase decline of the short-term cycle that began on February 3.

A quick rebound followed by a move above the last alpha high (AH) would reconfirm the current bullish short-term trend and favor additional strength. Alternatively, an extended alpha phase decline that moves well below the last short-term cycle low (STCL) at 3,214 would signal the likely transition to a bearish 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 below support at the lower boundary of the uptrend from October. Technical indicators are slightly bearish overall, tentatively favoring a continuation of the decline from last week.

Cycle Analysis

We are 3 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on January 31. A quick rebound followed by a move above the last alpha high (AH) would reconfirm the current bullish translation and favor additional strength. Alternatively, an extended alpha phase decline that moves well below the last STCL at 3,214 would signal the likely transition to a bearish short-term translation. 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: 15 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: March 13 to April 2; best estimate in the March 25 to March 31 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 rebound and close above the previous short-term high at 3,386 would reconfirm the uptrend from October and forecast additional gains.
  • Bearish Scenario: A close below congestion support in the 3,220 area would predict a move down toward congestion support in the 3,150 area.

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

Category: Forecasts, Short-term Forecasts


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