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A very dull day overall in markets. The S&P 500 attempted to rally but couldn’t maintain its gains, finishing up just nine basis points. Both the S&P 500 and NASDAQ 100 futures show classic rising wedge patterns accompanied by declining volume.
However, after two previous patterns suggested an imminent reversal, as previously noted, the market has merely consolidated sideways so far.
In the NASDAQ 100 futures, the pattern is clearer when using closing prices, particularly alongside declining volumes. Typically, a rising wedge (also known as an ending diagonal triangle) is considered a reversal pattern, suggesting a break lower. This doesn’t guarantee a downward move, but that’s what the odds currently favor.
From another perspective, the 79-day cycle is nearing completion. Historically, this cycle has been reliable in terms of timing, suggesting that the index may also be approaching a turning point.
(Cycles.org)
Meanwhile, the longer-term 180-week cycle, which remains the dominant cycle, is still firmly in a downtrend and is not projected to complete until October 2026. The previous cycle peaked in August 2021 and was originally scheduled to bottom in March 2023, but the market actually peaked six months later (January 2022) and bottomed six months earlier (October 2022). Given this, it’s possible the current cycle could end earlier than expected. However, I’d be surprised if it had already concluded, suggesting either another move lower or an extended period of sideways price action.
(Cycles.org)
Anyway, that’s all for today.
-Mike
Terms By ChatGPT
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79-day cycle:
A market-timing pattern recurring roughly every 79 trading days, often used in cyclical analysis to predict potential turning points.
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180-week cycle:
A longer-term market cycle repeating approximately every 180 weeks (about 3.5 years), considered a dominant cycle influencing longer-term trends and reversals.
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Dominant cycle:
A cyclical pattern that consistently appears and significantly influences price movements over a given period, often identified through historical analysis.
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Ending diagonal triangle:
A technical pattern typically occurring at the end of a price trend, characterized by converging trend lines indicating weakening momentum and often suggesting an impending reversal.
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Rising wedge:
A technical chart pattern where price consolidates with narrowing ranges between two upward-sloping trend lines. Typically viewed as bearish, it suggests a potential downward reversal.
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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