12-19-24 Update – Stock Indexes Fulfilling December 16 – 20th Danger Period; Confirming November 25th Cycle Highs!  Reinforcing Late-December/Early-January ’25 Outlook…

November 25th Times Cycle Peak in Major Stock Indexes (IDX, RUT & DJTA); Upside Price Targets Attacked!

11/30/24 – “Outlook 2025 – The Three ‘Cs’ of Trading

Some revealing market relationships are maturing so it is a good time to review important principles about analyzing and/or trading seemingly related markets.  The recognition and adherence to one critical principle is vital to long-term trading success.

Coincidence, Correlation or Causality?

In early-October, two coinciding analyses – in two often-correlated markets – were repeatedly described in the Weekly Re-Lay with the focus on new buy signals that were projecting strong rallies into November 2024.  Those two markets were Stock Indices – with the focus on the S+P Midcap 400 and to a lesser extent, the Russell 2000 – and Bitcoin.

The obvious question was: ‘What Does This Mean?’.

Context for 3 ‘C’s

The two markets often move hand-in-hand.  However, ‘coincidence does not mean causality’.  More likely, it is a case of an overriding factor(s) influencing multiple markets similarly.  They do, however, provide a corroborating interplay…

The Oct 3, 2024 issue of The Bridge (a Weekly Re-Lay publication) elaborated on July/August 2024 cycle lows in Bitcoin and explained how new buy signals were projecting a surge into Nov. 2024 (as part of a broader advance into 2025).

Days later, the Oct 9, 2024 issue of the Weekly Re-Lay (and repeated issues that followed during October & November) described the ’coinciding’ outlook for the S+P Midcap 400 – and related small and midcap stocks & indexes – to undergo two successive rallies.  (See insets.)

The first rally was forecast to unfold in October and – after a quick sell-off into early-Nov. cycle lows – the second was forecast to take place in November, lasting through most of the month and potentially peaking in late-November.

[November 22 & 25th were highlighted as the two days with the greatest synergy of daily, weekly & monthly cycle highs converging.  However, with cycles of this magnitude – many of them being weekly or monthly cycles – there is a broader range of time when a multi-month peak could take hold.]

Combining the ‘C’s

On Oct 16, 2024, the Weekly Re-Lay brought these analyses together with an Alert titled: “Crypto Correlation: Coincidence or Causality?”.  In there, the outlook for two coinciding rallies was reiterated, concluding the following:

10-16-24 – The October 3, 2024 issue of The Bridge focused on Currency War cycles and the potential for Bitcoin to see an October surge…. stock indexes were projecting a similar October surge with small and mid-cap indexes expected to lead the way… Whether that is coincidence or causality – or a little of both – matters little.  It is always important to analyze each market on its own merits and technicals and to avoid the temptation to trade one market off the outlook for another.” — October 16, 2024 Weekly Re-Lay Alert

The two can, and sometimes do, move in lockstep with one another but the magnitudes and timing of those corresponding moves often diverge due to a myriad of other factors that exert a stronger influence on the markets being observed.

And that brings this discussion to the ‘Axiom of Market Correlation’ reprinted on page 6. Each market should be assessed on its own merits.

8’s & 80’s: Cycles of Conflict

Another pair of ’C’s – Cycles of Conflict – are focused on 2025 as a potentially volatile time.  One is the culmination of the 80-Year Cycle of War that helped pinpoint the Russia/Ukraine & Hamas/Israel conflicts.  2025 is 80 years from 1945… and all that occurred during that momentous year.  It is also 160 years from 1865 (culmination of Civil War).

The other is the 8-Year Cycle of American Attacks (physical & cyber) that recurs in 2025.  That has been discussed over the past ~15 years and has also timed major cyber attacks that entered escalated phases in 2009 & 2017. Stay tuned…

Stock Indices have further validated the latest phase of the 17-Year Cycle of Stock Market Peaks. While that could time a peak at any point in 2024, most indications were signaling it would wait until 4Q 2024.  (The first chance was in October ‘24 but was not confirmed – with several stocks peaking as the Indexes failed to reverse.)

If/when that is fulfilled, the next question would be what it would take to signal a top… and when a substantial decline would become more likely.  Those factors are [reserved for subscribers]…

The subsequent decline – based solely on that 17-Year Cycle (other factors will be incorporated) – is expected to last  [reserved for subscribers]… and lead to at least a 20% decline… potentially as much as 50%.  To reiterate, that is JUST ONE factor in the midst of many – so it should not be overweighted in significance.

Of the last 3 occurrences, 2 of them lasted 1.5 – 2-years and suffered ~50% declines.  The 3rd one (1990) lasted ~3 months and only dropped ~20%.  So, there is a wide variance with this broad cycle.  That is why the synergy of corroborating cycles and indicators is vital to validate this potential.

Two of the primary things the 17-Year Cycle has historically timed – with uncanny consistency – are stock market peaks (and subsequent sell-offs of a higher magnitude) and Middle East conflict.

The latter of those is being fulfilled with uncanny precision… while the former remains to be seen as stocks have not yet signaled a peak.

Range Trading Redux (Déjà vu?)

When it comes to validating and acting on these cycles, price action is always the primary focus.  The past month brought some key validations to the broader outlook – reinforcing the thinking that most upside objectives are being fulfilled as lagging indexes projected October/November rallies.

One of them arrived in the index that led the Nov ‘21 peak and reversal lower (and subsequent 2022 sell-off)… and helped pinpoint the late-2023/early-2024 low and reversal higher – the Russell 2000.

In November 2021, Weekly Re-Lay publications updated the ongoing range-trading phenomenon in the Russell 2000 and explained how the attainment of major price and timing upside objectives were expected to usher in a 1 – 2 year peak (in Nov ‘21 and near 2460/QR) and a 6 – 12 month decline as part of that process.

Included with that analysis was a chart similar to the one included above, illustrating why ~2460/QR was decisive resistance projected to usher in that peak after fulfilling a myriad of upside price targets, wave objectives and range-trading targets (see Nov 2021 Weekly Re-Lays and December ‘21 INSIIDE Track for related analysis and charts).

The Russell 2000 peaked in perfect lockstep with that convergence of targets and cycle highs and began a ~2-year decline that did not set its lowest weekly close until late-October 2023… as it was again testing the levels of the 2018 & 2020 peaks – multi-year levels of ‘resistance turned into support’.

That 2023 low ushered in a ~year-long advance – a 50% rebound in time – that brought the Russell right back to the same major upside target at ~2460/QR… three years from its previous peak.

The rally into November 2024 perpetuated this range-trading sequence and finally had the Russell 2000 attacking that objective at the same time a myriad of daily, weekly & monthly cycles converged in late-Nov…. that fulfills a number of upside objectives and cycles…

2025/2026

There are many related 17-Year Cycles that are entering the volatile and unsettling transition phase.  They include US recessions, real estate extremes, US Dollar extremes, earth disturbance swarms, solar-related phenomenon, etc.

It may take substantial time for these to reach fruition but they are all expected to create a very challenging period from late-2024 into late-2026.  The topping phase needs to unfold first… then the ‘dominos’ should start to fall.

6 – 12 month & 1 – 2 year traders and investors can  [reserved for subscribers]…” — December 2024 INSIIDE Track TRADING INVOLVES SUBSTANTIAL RISK!

October/November Surges

In early-October, the Weekly Re-Lay explained how and why stock indexes should see an overall rally into late-November ’24 with multiple peaks (and quick sell-offs) along the way…

A multi-week peak was forecast for October 17/18 and projected to spur a quick drop (first ‘Danger Period’) into early-November.

Stocks Followed Suit.

A second peak was projected for November 11/12th, with a quick sharp drop into November 18th forecast (second ‘Danger/Panic Period’).

Stocks Followed Suit.

All along, a (MUCH) more significant peak has been forecast for November 22/25th – in the S+P Midcap 400, DJTA & Russell 2000.  Multi-month upside range-trading targets were identified at ~3400/IDX, ~17,600/DJTA & ~2460/QR.

So far, stocks have adhered to this analysis with the S+P Midcap 400, DJTA & Russell 2000 peaking on November 25th while attacking their multi-month upside range-trading targets at ~3400/IDX, ~17,600/DJTA & ~2460/QR… fulfilling decisive objectives and pivotal cycles that have been in focus these past two months.

That projects an initial multi-week drop into December 16 – 20th… with downside targets already taking form.  Key indicators – like the daily & weekly 21 MACs/MARCs and daily/weekly trend indicators – are revealing when a new (and more dangerous) ‘Danger Period’ is more likely.

Multiple Stock Indexes Fulfill Price AND Time Upside Targets; Project Quick, Sharp (Multi-Week) Declines!

Specific analysis, targets, cycles & projections will continue to be published in related Weekly Re-Lay & INSIIDE Track publications.

TRADING INVOLVES SUBSTANTIAL RISK!

More information can be found at www.insiidetracktrading.com.