Short-term Forecast for January 12, 2021

| January 12, 2021

Stock Market Commentary

We are 19 sessions into the alpha phase rally of the short-term cycle that began on December 14. The alpha high (AH) of the current cycle is overdue and it could form at any time, if it has not already occurred on January 8.

The magnitude and duration of the current alpha phase rally reconfirm the current bullish short-term trend and forecast additional gains.

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 higher today, holding below recent highs of the uptrend from March. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 19 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on December 14. The alpha high (AH) is overdue and it could form at any time, if it has not already occurred on January 8. The magnitude and duration of the current 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 25 to February 12, with our best estimate being in the February 4 to February 10 range.

  • Last STCL: December 14, 2020
  • Cycle Duration: 19 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: January 25 to February 12; best estimate in the February 4 to February 10 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 high at 3,825 would reconfirm the uptrend from March and forecast additional gains.
  • Bearish Scenario: A reversal and close below the middle of the Bollinger bands at 3,730 would predict a return to the 50-day moving average at 3,639.

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

Category: Forecasts, Short-term Forecasts


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