econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 19 January 2017

Stock Market Bull Faces Important Test

by Erik McCurdy, Prometheus Market Insight

On January 3, our computer models identified the likely formation of a short-term low in the stock market. The latest short-term cycle low (STCL) developed as predicted, but the initial rally phase of the new cycle has struggled to advance since the last week, suggesting that a short-term reversal has become more likely.

A quick reversal followed by a move well below the last STCL at 2,239 on the S&P 500 index would signal the likely transition to a bearish translation and favor additional short-term weakness. From an intermediate-term perspective, the stock market is also exhibiting early signs of a reversal. The current cycle from November has struggled to advance to new highs for the past five weeks and one of our proprietary intermediate-term cycle oscillators has already experienced a bearish crossover.

A subsequent weekly close below 2,252 on the S&P 500 index would generate an intermediate-term cycle high signal and predict additional weakness for two to three months heading into the next intermediate-term low in late March or early April. From a big picture perspective, the stock market continues to form a massive distribution pattern and it remains likely that the cyclical bull market from 2009 is in the process of terminating.

By holding interest rates near zero and engaging in quantitative easing during the past seven years, the Federal Reserve has created massive financial market imbalances and encouraged speculation. The gains experienced by the stock market since late 2011 have been driven primarily by monetary stimulus, as opposed to healthy economic growth, and this highly speculative advance will almost certainly be erased during the forthcoming bear market. However, it is always important to remember that a long-term top is a process, not an event. The character of the current short-term cycle will provide the next assessment of stock market health, so it will be critical to monitor market behavior closely during the next several weeks.

We will identify the key developments as they occur in our daily market forecasts and signal notifications available to paid subscribers. Try our service for free. If you are a paid subscriber, login to read the full version of this commentary.

>>>>> Scroll down to view and make comments <<<<<<

Click here for Historical News Post Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted. You can also comment using Facebook directly using he comment block below.




Econintersect Contributors


search_box

Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.


Take a look at what is going on inside of Econintersect.com
Main Home
Analysis Blog
Slow Economic Growth Will Be Around For A Long Time
The Job Guarantee, Wage-Price Inflation And Alternative Solutions: Part 2
News Blog
Are Smartphones Killing Digital Cameras
What We Read Today 28 March 2017
NASA Precise Landing Technologies Tested On Vertical Testbed Rocket
March 2017 Conference Board Consumer Confidence Highest Since 2000
Richmond Fed Manufacturing Survey Again Improves In March 2017.
Case-Shiller 20 City Home Price Index January 2017 Shows 5.7 % Year-over-Year Growth
A Changing Rulebook To Tame The New Global Arms Race
Infographic Of The Day: Chart: Understanding Alphabet's 4 Billion Dollar In "Other Bets"
Early Headlines: Asia Stocks And Dollar Up, Oil, Gold Steady, Obama Climate Policies Gone, US Oil Glut, Euro Surges, Shorts Remain, Trump Into Yemen?, Iran-Russia Deals, Cat 4 Cyclone Hits Oz, And More
March 27, 2017 Weather and Climate Report - Will the MJO Deliver a Nino?
The Most Reputable Companies Worldwide
Gut Bacteria Play A Role In Long-term Weight Gain
What We Read Today 27 March 2017 - Special Public Edition
Investing Blog
Investing.com Technical Summary 28 March 2017
The Dollar's Coming Impact On Markets
Opinion Blog
Macron May Lead But Le Pen Remains The Big Story
Is The 20th Century Still The 'Hayek Century'?
Precious Metals Blog
These Gold Stocks Will Produce Much Bigger Gains Than Gold Itself
Live Markets
28Mar2017 Market Close: US Stocks Posted Gains, DOW Closed Up 150 Points, Crude And US Dollar Steady
Amazon Books & More






.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government































 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved