Intermediate-term Forecast for January 30, 2021

| January 30, 2021

Stock Market Commentary

We are 18 weeks into the rally phase of the intermediate-term cycle that began during the week ending September 25. The latest intermediate-term high may have formed during the week ending January 22, although we would need to see additional weakness to confirm that development.

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

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, retreating from recent highs of the uptrend from October. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 18 weeks into the rally phase of the cycle following the intermediate-term cycle low (ITCL) that occurred during the week ending September 25. The latest intermediate-term cycle high (ITCH) may have formed during the week ending January 22, although we would need to see additional weakness to confirm that development. The magnitude and duration of the current rally phase reconfirm the current bullish translation and forecast additional gains. The window during which the next ITCL is likely to occur is now through March 19, with our best estimate being now through February 26.

  • Last ITCL: September 25, 2020
  • Cycle Duration: 18 weeks
  • Cycle Translation: Bullish
  • Next ITCL Window: Now through March 19; best estimate now through February 26.
  • 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 weekly close above the recent high at 3,852 would reconfirm the uptrend from March and forecast additional gains.
  • Bearish Scenario: A weekly close below the middle of the Bollinger bands at 3,582 would predict a return to the 50-week moving average at 3,257.

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

Category: Forecasts, Intermediate-term Forecasts


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