Cycle Possibilities for Weakness this Week

Update January 5th, 2016 10AM EST:
The hourly score is now -40% and could be -20 to -30% in the next hour or two. That still leaves room for further counter-trend bounce, but the indicators are becoming relieved enough to allow for trend continuation and lower lows. So, a gap fill to SPX 2045 might be the best scenario bulls can hope for, but I doubt that will happen until next week. Good fortune.
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Update January 4th, 2016 3:40PM EST:
The hourly score is now -75%. I re-entered fully short on the bounce to back-test 2005 and will unload a small portion again with a retest of the low and/or a change in the technical situation. Due to the hourly score, a strong bounce could occur at any time with high risk in both directions at tomorrow's open, but the daily, weekly and monthly trends are all down with some hourly indicators not extremely bearish. So, I think more downside is favored whether it occurs today, tomorrow or the next day. SPX 1970-1980 still appears like a good target area short-term. If the trend or hourly score significantly changes, I will let you know as soon as possible. Good fortune.
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Update January 4th, 2016 10AM EST:
Wow. That was fast. Futures had only dropped from +5 to -5 when I was posting last night. The hourly score is now -65%. That's definitely enough to justify small profit-taking on shorts and SPX has already reached the 1993/2005 support. However, the hourly score can reach -85-100% and then still sometimes drop another 20-30+ points, so I'll hold most of my position until the score is more extreme or a daily swing up occurs. Unless there is a rapid reversal today which seems unlikely to me, it looks like the SPX 1970s are a good target as I proposed last night. Good fortune.
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My previous post suggested SPX could vacillate between 2000 and 2080 for the next 2 weeks with OPEX max pain currently at SPX 2050 being a potential magnet near January 15th. Although I stand by what I said, I can see scenarios/EW/patterns where 2000 and 2080 are pierced before reverting back to the middle of the range.


After reviewing Wood's monthly cycle newsletter and merging it with my spending cycle projection for a significant SPX low in April +/-, there is a strong possibility for weakness this week that tests or breaks the SPX 1993/2005 lows and then rebounds for a week or three or more. That fits my expectation that the big SPX drop towards 1750ish for starters is still at least 2-4 weeks from starting. In this short-term bearish scenario, I am doubtful my original 1950s/1900s targets will be reached, but a potential price channel/flag since November 3rd and fulfillment of the TRIN study I posted a couple weeks ago suggests that SPX 1993/2005 could easily be broken with the 1970s being a target. OEW also has a pivot there and expects a test of that level if SPX falls below 2034.


This is just one potential scenario allowing SPX to travel somewhat sideways into mid-to-late January, but it fits several of my puzzle pieces and Woods' cycle work, so I thought it was worth mentioning. Of course, SPX doesn't usually move more than 20-30pts once my hourly indicators reach an extreme score near 90-100%, and I anticipate that will happen before the 1970s are reach, so I also anticipate there will be a decent rally or two during that scenario's 1-week +/- fall.




One other possibility that fits my work is a sideways triangle that has lasted weeks already and could last weeks longer. However, I have seen this option mentioned in the blogosphere perhaps too often, and that's so 2015.


Overall, my previously posted research suggests SPX will form significant lows in April 2016 +/- and Oct 2016 +/- likely 48% +/- below the top (SPX 1100 +/-) with SPX 1750ish and 1600ish being pit-stops and with a statistical/pattern/cycle possibility for lows below SPX 667 AND/OR bouncing around SPX 1000-1500 into year 2020 to fulfill more typical secular bear market stats like time-length, P/E ratios and my custom DRSI indicator which is still projecting lower annual RSI more comparable to CY1930s and CY1970s as compared to the higher levels seen in CY2002/2009. Good fortune.