Intermediate-term Forecast for March 21, 2020

| March 20, 2020

Stock Market Commentary

We are 5 weeks into the decline phase of the intermediate-term cycle that began in October. The latest intermediate-term low is imminent, and it could form at any time.

The magnitude of the current decline phase signals the likely transition to a bearish intermediate-term trend and favors additional losses during the next cycle.

S&P 500 Index Weekly Chart Analyses

The following technical and cycle analyses provide intermediate-term forecasts for the S&P 500 index. For short-term outlooks, see the latest short-term forecast.

Technical Analysis

The index closed sharply lower this week, moving down to a new low for the violent downtrend from February. Technical indicators are extremely bearish overall, strongly favoring a continuation of the decline.

Cycle Analysis

We are 5 weeks into the decline phase of the cycle following the intermediate-term cycle low (ITCL) that occurred during the week ending October 11. The magnitude of the current decline phase signals the likely transition to a bearish translation and favors additional weakness. The window during which the next ITCL is likely to occur is now through March 27.

  • Last ITCL: October 11, 2019
  • Cycle Duration: 24 weeks
  • Cycle Translation: Bearish
  • Next ITCL Window: Now through March 27.
  • Setup Status: No active setups.
  • Trigger Status: No pending triggers.
  • Signal Status: No active signals.
  • Stop Level: None active.

Intermediate-term Outlook

  • Bullish Scenario: A rebound and weekly close above the bottom of the Bollinger bands at 2,642 would predict a move up toward the middle of the Bollinger bands at 3,129.
  • Bearish Scenario: A weekly close below current levels would reconfirm the downtrend from late February and forecast additional losses.

Both scenarios are equally likely.

Category: Forecasts, Intermediate-term Forecasts


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