Short-term Forecast for September 10, 2020

| September 9, 2020

Stock Market Commentary

We are 5 sessions into the alpha phase decline of the short-term cycle that began on August 20.

A quick rebound followed by an extended beta phase rally that moves up to new highs would reconfirm the current bullish short-term trend and forecast additional gains. Alternatively, an extended alpha phase decline that moves well below the last short-term low at 3,360 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, returning to recent short-term lows below previous highs of the uptrend from March. Technical indicators are neutral to slightly bearish overall, suggesting that direction is in question with a slight downward bias.

Cycle Analysis

We are 5 sessions into the alpha phase decline of the cycle following the short-term cycle low (STCL) on August 20. A quick rebound followed by an extended beta phase rally that moves up to new highs would reconfirm the current bullish translation and forecast additional gains. Alternatively, an extended alpha phase decline that moves well below the last STCL at 3,360 would signal the likely transition to a bearish translation. The window during which the next STCL is likely to occur is from September 30 to October 20, with our best estimate being in the October 12 to October 16 range.

  • Last STCL: August 20, 2020
  • Cycle Duration: 15 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: September 30 to October 20; best estimate in the October 12 to October 16 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 well above the middle of the Bollinger bands at 3,429 would predict a return to the previous short-term high at 3,581.
  • Bearish Scenario: A close well below the 50-day moving average at 3,317 would reconfirm the downtrend from early September and forecast additional losses.

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

Category: Forecasts, Short-term Forecasts


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