S&P 500 - Update
by Antonis Benis, on Sep 15, 2020 11:53:12 AM
My last report on the US stock indexes was on September 1st.
The initial break into September 11th (lowest close) and the 50d MA (moving average), is now followed by a bounce that should top later this week or early next week at the latest.
Cycles suggest a top around September 17th, followed by a decline into October 16th; in line with the seasonally negative period (US presidential election pattern), see charts 1,2.
- Weekly slow stochastic (14,3) is expected to reach oversold levels below 25 at the bottom (like it did in 2018 and 2020, now at 67,80)
- S&P 500 and especially Nasdaq should continue to underperform Dow 30 and Russell 2000.
The initial leg down was 7,8125%; if now the market retraces 50% of it (around 3450, ideal scenario), then the targets are 3167 and 3023/3027 (textbook Gann), see chart 3.
US stock markets are following the presidential election pattern very well this year, it calls for a lower low into the middle of October. Traders should have an excellent shorting opportunity later this week/early next, time and price level are well defined.
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