17-Year Cycle & Stock Market Peaks VI
Stocks Plummeting into Initial Cycle Low (~Dec 19th); Casting Shadows Ahead to January 2025!
12-18-24 – “Stock Indices are reacting to the latest Fed move… or at least to the latest Fed words, plunging in line with monthly, weekly & daily cycles.
Except when the ‘actions’ surprise the markets – which is only a minority of the time – Fed ‘words’ are usually the focus, with traders meticulously dissecting what word or words changed in the latest Fed Statement.
While it should be no surprise – given all the data that has been released in the past ~6 weeks (since the previous Fed meeting) – that the Fed is looking to slow the pace and amount of rate cuts, the market still reacted as if this was new news.
In contrast, the market is doing exactly what cycles and a host of already-described technical indicators anticipated.
Stock indexes fulfilled 1 – 2 month upside targets and cycles on November 25th – as well as some multi-year cycles – adhering to the scenario described in early-October. The DJTA, Russell 2K & S+P Midcap all peaked right at their multi-month upside range (3400/IDX, 17,600/DJTA & 2460/QR) during the Nov 22/25th target cycle.
They generated multiple negative/sell signals in late-Nov/early-Dec and have consistently reinforced those signals in recent weeks.
The DJIA topped while fulfilling a ~4-week (25 – 28 day) low-low-low-(high) and a ~16-week low-low-(high) Cycle Progression and was projected to see an initial drop into Dec 16 – 19th… fulfilling the outlook for a multi-week drop to 41,600 – 41,800/DJIA.
Even 2024’s ‘tech darling’ – NVDA – peaked on Nov 7th (highest daily close) and created an intraday spike high on Nov 21st… and has since declined. Based on its daily 21 AND 40 MACs, that stock turned negative and entered its most vulnerable period (from a technical perspective) this week.
Since precisely fulfilling multi-month cycle highs on November 25th, the S+P Midcap 400 has declined on 12 out of the 16 days since then and already plunged to its first downside range-trading target (~3125/IDX).
The DJTA has declined for 14 of those 16 days, dropping over 10% from its Nov 25th peak.
While the DJIA extended its decline to 10 days straight for the first time since 1974, the S+P advance/decline line has dropped for 12 days in a row.
Are these outliers?
Or a warning of underlying weakness in the overall market?
Even as the NQ-100 set new highs – on the backs of a handful of overheating stocks – the rest of the market has validated what was described in early-October (projecting a multi-pronged advance into November 22/25th followed by sharp declines).
Meanwhile, the DJIA is doing exactly what was forecast on December 7th when it was projected to see a sharp, multi-week drop into December 19th with a primary downside target at 41,600 – 41,800 (published while the DJIA was above 44,500):
12-07-24 – “The DJIA…peaked while fulfilling a ~4-week (25 – 28 day) low-low-low-(high) Cycle Progression and could see an initial drop into December 16 – 19th. A multi-week drop to 41,600 – 41,800/DJIA is becoming more likely.” — Dec 7, 2024 Weekly Re-Lay
…These indexes are powerfully validating price targets and the outlook for an initial plunge into December 19th… The weekly closing levels should provide additional clues as to what to expect in the coming weeks.” — December 18, 2024 Weekly Re-Lay Alert
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 the ultimate top (at least in the S+P Midcap 400, Russell 2000 & DJTA) on November 25th, projected to occur near 3400/IDX, 2460/RUT & 17,600/DJTA:
November 25th Peak; Sell-off into December 19th
They fulfilled that analysis – peaking precisely on November 25th and precisely at those upside range targets – and were/are projected to undergo initial (sharp) multi-week sell-offs that would culminate on December 16 – 19th – when an initial low was/is most likely.
Acceleration lower was/is forecast for those final days (Dec 16 – 19th) as an initial leg down is being fulfilled, with a spike low most likely on December 19th…
https://www.linkedin.com/pulse/17-year-cycle-three-cs-trading-insiide-track-trading-6fvmc
https://www.linkedin.com/pulse/bellwether-index-insiide-track-trading-glmdc
All of this was/is forecast to ‘cast shadows ahead’ to two key time frames in 1Q 2025… the first in January 2025.
A blow-off spike low in stock indexes – on December 19th (+ or – 1 trading day) would POWERFULLY fulfill this ongoing analysis AND further validate what is expected for early-2025. Corresponding action in Gold & Silver, Bitcoin, Bonds, Energy Markets & the Dollar Index are corroborating this outlook.
At least one big surprise is appearing more and more likely for early-2025!
See previous Linkedin articles for corresponding analysis:
https://www.linkedin.com/pulse/17-year-cycle-stocks-4q-2024-octobernovember-finale-zbvac
https://www.linkedin.com/pulse/17-year-cycle-november-2024-cycles-stock-market-lwg3c
Specific analysis, targets, cycles & projections will continue to be published in Weekly Re-Lay & INSIIDE Track publications.
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