Cycle screening measures were stronger than the market averages for a change from the recent pattern. I have to wonder if this is a sign of real strength or another indication of the problem we’ve been having with these indicators lately.
The breather the market took today left an ambiguous picture. Most short term and 13 week cycle indicators have turned up. 6 month and 10-12 month cycle indicators are still pointing down.
Cycle screens are on the cusp of a big signal.
Breakdowns are just so passé any more. Last week’s horrible looking break of an “obvious” top pattern was, as feared, just another stupid pet trick by the Primary Dealers to shake loose the low hanging fruit.
Screening measures started to catch up with the gains in prices of the past couple of days in what looks like an ordinary rebound from an oversold level on the aggregate indicator, but not on the individual indicators.
The market continued its rebound without the support of confirming buy signals in any time frame.
The market’s rebound didn’t answer any questions in the cycle screens. They barely recovered and remain oversold.
By recovering, the market set up a narrow no man’s land. Here’s what it means.
Weakening in cycle screening measures put the aggregate at a level that normally coincides with or precedes market lows by a few days.
The SPX now faces critical trend support in the 1790-1810 area. Cycle projections point to that area as well, but with all key swing cycle indicators in gear to the downside and time left in the idealized time counts for these cycles, an additional slide is possible, if not likely. But it’s not how the…