08/17/17 – INSIIDE Track Stock Index Update: Stock Indices are reinforcing the Decennial Danger Period and the outlook for an (initial) sharp decline from late-July into late-August.  That cycle was corroborated by the Indices reaching multi-year upside objectives – and the ideal wave targets for a ‘5th’ wave peak – at the same time they reached weekly extremes.

As they entered this Danger Period, many Indices produced late-July & early-August reversal signals with the S+P 500 triggering a 1–4 week sell signal near its highs – at 2473–2484.5/ESU (see Weekly Re-Lays).  Corroborating those signals, the ESU & NQU gave outside-week/2 Close Reversals lower as the DJIA & ESU neutralized their weekly uptrends, projecting more downside in the coming week(s).

As explained previously, this 10-Year Cycle has timed major stock market sell-offs in the ‘7’ year of the decade during the majority of the decades since 1837.  And, the majority of those declines took place during the July–November period of those ‘7’ years.  2017 is the next in that sequence.

More recently, the pattern of 3rd Quarter declines has repeated on a 3-Year AND a 2-Year basis.  Several examples were cited before, including:

July–Oct. 1997 – Asian Financial Crisis sell-off.

July–Oct. 1999 – Sell-off before final spike high of early-2000.

May–Sept. 2001 – Drop leading into 9/11.

July–Oct. 2005 – Sideways correction, leading to Oct. ‘05 low & new advance

July–Aug. 2007 – Sell-off before final high.

July–Oct. 2011 – Sharpest part of May–Oct. 2011 decline.

July–Oct. 2013 – Sideways correction, leading to Oct. ‘13 low & new advance.

July–Aug. 2015 – Chinese equity meltdown (30–40% drop) infecting global stocks.

Decennial Danger Period – August 15–24th

In 2011, 2013 & 2015 (as well as 2016), the DJIA suffered significant sell-offs between late-July/early-Aug. & late-Aug./early-Sept. – further honing these cycles.  The most recent three of those were as follows:

2013 – August 2–August 28th decline (~6%).

2015 – August 10–August 24th decline (~13%).

2016 – August 15–Sept. 12th decline (~4%)

August 2017 was forecast to see a similar sell-off, with the most synergistic time for a sharp drop lying between August 15th–August 24th, a period involved in every one of these previous declines.  That multi-year analysis (and 360-degree cycle) was corroborated by recent price action and signals, although August 22nd is showing a bit more current synergy for anticipating an initial low.


On a short-term daily basis, the Indexes were expected to bounce on Aug. 14th and possibly 15th, before entering a more accelerated decline.  That was linked to the Nasdaq 100’s daily trend pattern, described late last week.

Several Indexes (Russell 2K, NQ-100, NYSE) powerfully validated that analysis, fulfilling a textbook daily trend pattern, turning their daily trends down on Friday and then bouncing for 2–3 days as they prepared for a more destructive sell-off after Aug. 15th.

They rebounded right to their (new) daily trend neutral points, remaining negative throughout these rebounds and turned back down in line with the more dangerous period of August 15–22nd.

That dovetailed perfectly with the daily 21 MARCs in the ESU & NQU, which set the stage for the daily 21 MACs to turn down on August 17th and increase the likelihood for a sharp sell-off.

The Russell 2K remains negative since peaking in late-July & perpetuating a 6-week/40–44 day high-high-high-high Cycle Progression.  A drop into Aug. 18–22, the next phase of a 13–14 day high-high-high-high-(low) Cycle Progression, is still likely.

A drop into August 18–22 would perpetuate an ongoing ~30-degree & ~90-degree cycle (Mar. 16 high, Apr. 17 & May 17/18 lows, June 19 & Jly. 21 highs).  The Russell 2000 neutralized its intra-year uptrend while twice neutralizing its weekly uptrend.  It would take a weekly close below 1368 to turn that weekly trend down.

That also pinpoints Aug. 18–22nd as the likely time for an initial downside culmination.  With the Aug. 15th rebound spike high, the Russell 2K has created a corroborating, short-term, 7-day high-high-(low) Cycle Progression targeting August 22nd for a low.

With the growing potential for an accelerated decline, at least one target should be recognized.  It is the level of the monthly HLS (extreme intra-month downside target) – which comes into play at 21,023/DJIA, 2359/ESU & 5213/NQU.

Please refer to the August 12, 2017 INSIIDE Track Intra-month Update for analysis and/or trading strategies on all other covered markets.

Futures trading involves substantial risk. Past performance is no guarantee of future results. Update trades apply only to INSIIDE Track analysis, and are distinct from Weekly Re-Layrecommendations. The next INSIIDE Track Update will be after 9:00 PM CDT on Aug. 19th….  and on any intervening day in which the DJIA cash index closes 200 points or more in either direction.