Short-Term Forecast for May 11, 2021

| May 11, 2021

Stock Market Commentary

The sharp decline during the last 2 sessions indicates that the short-term cycle from March is likely still in progress. We are 2 sessions into the beta phase decline of the short-term cycle that began on March 25.

A quick rebound followed by an extended alpha phase rally would reconfirm the current bullish short-term trend and forecast additional gains. Alternatively, an extended beta phase decline that approaches the last short-term low at 3,853 on the S&P 500 index would suggest that trend direction is in question.

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 lower today, retreating further from recent highs of the uptrend from 2020. Technical indicators are effectively neutral overall, suggesting that direction is in question.

Cycle Analysis

The sharp decline during the last 2 sessions indicates that the short-term cycle from March is likely still in progress. We are 2 sessions into the beta phase decline of the of the cycle following the short-term cycle low (STCL) on March 25. A quick rebound followed by an extended alpha phase rally would reconfirm the current bullish translation and forecast additional gains. Alternatively, an extended beta phase decline that approaches the last STCL at 3,853 would suggest that cycle translation is in question. 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.

  • Last STCL: March 25, 2021
  • Cycle Duration: 33 sessions
  • Cycle Translation: Bullish
  • Next STCL Window: Now through May 25, with our best estimate being 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 rebound and close above the recent high at 4,233 would reconfirm the uptrend from March and forecast additional gains.
  • Bearish Scenario: A close below uptrend support at 4,125 would predict a return to the 50-day moving average at 4,046.

Both scenarios are equally likely.

Category: Forecasts, Short-term Forecasts


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