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How to Tell When This Inconclusive Market Turns Dangerous

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The timing of a likely 10-12 month cycle top is uncertain. The 6 month cycle, however, has begun to show signs of topping out. This report shows you what to look for.

The shorter cycle setup suggests that nothing significant will happen this week, but at the same time, that anything could happen. We wait for a tipping point that signals the next big move, day to day. But liquidity is trending bearish. 

On the cycle chart, all channels are still rising. The SPX would need to end the week below xxxx (subscriber version) to signal a potential change of direction in the longer term cycles of 10-12 months or more.   

On the Third Rail Chart the SPX is churning in two crossing channels. One is a short term channel with a slight downslope. Support descends from xxxx to xxxx (subscriber version) this week. Uptrending support below that rises from xxxx to xxxx . All would need to be broken to start anything significant on the downside. If the market starts off to the upside there are wide open spaces to the first trend resistance line at xxxx.

On the weekly chart the uptrend is tenuous but intact, despite the negative divergence in 3-4 year cycle momentum. SPX would need to end a week conclusively below xxxx to xxxx (subscriber version) to signal that this might be the start of a bigger top.

The monthly chart now shows the conditions suggesting the formation of a 7 year cycle top. If the S&P ends December below xxxx (subscriber version), the uptrend would be broken, and the target would then be the trendline now at 4000. Conversely, if the xxxx area remains intact, the way would be clear for a move to xxxx-xxxx in early 2022.

Cycle screening measures are inconclusive after dropping last week. Up days early this week would tend to xxxx xxxx xxx xxxx (subscriber version) intermediate term outlook. But weakness would suggest at least xxxx, or even something much bigger. Here again, we await signs of a tipping point. This report shows you the trigger levels.

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These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance. 

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