February 19th, 2015
by Erik McCurdy, Prometheus Market Insight
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 and for long-term outlooks see the latest long-term forecast.
The index closed near unchanged yesterday, holding near recent highs of the cyclical bull market from 2009. Technical indicators are bullish overall, strongly favoring a continuation of the advance.
We are 12 sessions into the alpha phase rally of the cycle following the short-term cycle low (STCL) on January 30. Cycle translation remains in question. An extended alpha phase rally that moves well above the last alpha high (AH) near 2,091 would reconfirm the current bullish translation and favor additional short-term strength. Alternatively, a quick reversal followed by a move well below the last STCL at 1,995 during the alpha phase decline would signal the likely transition to a bearish translation. The window during which the next STCL is likely to occur is from March 13 to April 2, with our best estimate being in the March 25 to March 31 range.
- Last STCL: January 30, 2015
- Cycle Duration: 12 sessions
- Cycle Translation: Bullish
- Next STCL Window: March 13 to April 2; best estimate in the March 25 to March 31 range.
- Setup Status: No active setups.
- Trigger Status: No pending triggers.
- Signal Status: No active signals.
- Stop Level: None active.
- Bullish Scenario: A close well above current levels would reconfirm the long-term uptrend and forecast additional gains.
- Bearish Scenario: A reversal and close below the 200-day moving average near 1,986 would signal the start of a new downtrend and predict additional losses.
The bullish scenario is more likely (~70% probable).