Short-Term Forecast for May 6, 2021

| May 6, 2021

Stock Market Commentary

We are 5 sessions into the beta phase decline of the short-term cycle that began on March 25. The latest short-term low may have formed on May 5, although we would need to see additional strength during the next session to confirm that development.

The magnitude and duration of the last 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 moderately higher today, returning to previous highs of the uptrend from 2020. Technical indicators are moderately bullish overall, favoring a continuation of the advance.

Cycle Analysis

We are 5 sessions into the beta phase decline of the of the cycle following the short-term cycle low (STCL) on March 25. The magnitude and duration of the last alpha phase rally reconfirm the current bullish translation and forecast additional gains. The window during which the next STCL is likely to occur is now through May 25, with our best estimate being in the May 12 to May 18 range. The latest STCL may have formed on May 5, although we would need to see additional strength during the next session to confirm that development.

  • Last STCL: March 25, 2021
  • Cycle Duration: 31 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through May 25; best estimate in the May 12 to May 18 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 well above the recent high at 4,211 would reconfirm the uptrend from March and forecast additional gains.
  • Bearish Scenario: A reversal and close below the 50-day moving average at 4,025 would predict a move down toward congestion support in the 3,700 area.

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

Category: Forecasts, Short-term Forecasts


Comments are closed.