The S&P500 market December/2/2024 update
Since my last update on the October 21, the S&P500 market reached new all-time high,
Let’ see in detail what’s happened and more importantly what we can expect in the next few weeks.
The S&p500 index formed a 20 days low on November 4, and an all-time high at 6,025.42 on November 26.
Let’s start by the 20 days cycle.
The low was expected to occur on October 25, but the 20 days cycle formed his low 10 days later, meaning this 20 days cycle is 10 days longer then the usually 18 days length.
This is certainly due to the American election.
This happen very often, when the market expect an important news, sometime this reduce or extend the cycle length.
The next 20 days cycle low was expected on November 22.
The low occurred on November 19, 3 days earlier.
At that stage of the cycle, the S&p500 market should find support on his cycle line, but on November 19, the market slightly cross below his cycle line at 5,895 and 5,885, providing a downside target zone between 5,774 and 5,753.
The same day, the S&p500 market made a low at 5,855.29, missing his target, bringing down the success rate to 83%.
In a very bullish market like the one we are in, I don’t believe is good idea to trade the very short term downside signal, unless this is at least the last leg of a longer cycle, like an 80 days or 20 weeks cycle, because in this case all the cycles are on the down phase.
On November 26, the S&P500 market crossed back above his cycle lines at 5,977 and 5,986, providing an upside target zone between, 6,098 and 6,116, respectively 121 and 130 points, or between 2.02 and 2.17% of potential profits.
On November 26, the same day the S&P500 market made an all-time high at 6,025, just 73 points below his lower part of the target zone.
During the next peak formation, we can expect the target zone will be meet.
The next 20 days low is expected for the December 7, during the next low formation, the S&P500 market should cross below his cycle line, providing a downside target.
The 40 days cycle
On The last update, the peak for this cycle was expected on October 25, the peak occurred 8 days earlier on October 17 at 5,878.46.
After forming his peak, the S&P500 market crossed below his cycle lines at 5,822 and 5,795, providing a downside target zone between 5,765 and 5,712, or respectively 56 and 83 points or between 0.96 and 1.43% of a potential profits.
With a low at 5,696, the target has been meet and slightly exceed during the last 40 days formation on November 4.
On November 6, the S&P500 market crossed back above his cycle lines at 5,848, providing an upside target at 6,000, for 152 points or 2.59% of potential profits.
On November 8, with a 6,012 high the S&P 500 market meet his target.
The next 40 days cycle low is expected on December 8, the blue vertical dashed line on the chart.
We can expect the next peak will form very soon, and during the next 40 days Low, the S&P 500 market should cross below his cycle line, providing a downside target zone.
Technically the low should at least find support on the 80 days cycle line.
On the chart there is a table with the cycle lines and their potential targets if the market cross below them this week.
The success rate, trading the 40 days cycle is 90%.
Let’s see the 80 days Cycle
With a 6,025 high on November 26, the S&P500 market is only 62 points away, or 1.01% from the bottom part of the target zone, triggered in August this year.
Since the high is within 1% of marge of error, we can considerate the target have been met.
The purple trend line, is the 80 days cycle trend line, or what’s Hurst call the VTL.
When the S&P500 market will cross below it, this will confirm the 80 days cycle peak, but more important, this will also confirm the 20 weeks peak has formed or in formation.
During the next 80 days low formation, the S&P500 market should cross below his cycle lines, giving a downside target for this 80 days cycle.
Here on the chart, the table for the cycle lines and their potential targets if the S&P500 market cross below them this week.
The low is expected during the first two weeks of December, the vertical purple dashed line.
According to the Hurst principle of synchronicity, since this will be the second 80 days cycle from the major August low, this will also be the 20 weeks cycle low.
The success rate for trading the 80 days cycle is 100%, meaning all the trading signal are profitable.
Let’s see on the roadmap where we actually are.
After forming his 40 days low on November 4, we are right at the red arrow, and on the way to the 80 days cycle peak.
When the 80 days cycle peak will be confirm, the S&P500 market will cross below his cycle line, providing a price target for the 80 days cycle, forming a first low around the first week of December, then rally toward his cycle line, using it as resistance and will resume his down move to the second week of December to form the 80 days cycle low around December 14.
The 20 weeks cycle
There is a very high probability the S&P500 market is forming his 20 weeks cycle peak.
During the formation of this 20 weeks cycle low, the S&P500 market should find support on his cycle line, which will be around 5,700 on the December 14.
Since the 20 weeks peak will form on the right part of the cycle, Hurst call that the right time translation, this confirm we still have a good amount of bullishness in the S&P500 market, and in this case there is a possibility the market will not even reach his cycle line.
The blue trend line drew from the October 2023 low to the August 2024 low, is the 40 weeks VTL, this trend line will be very helpful to identify the next 40 weeks peak and the next 18 months cycle peak, which is scheduled for the quarter of 2025.
The 18 months low is expected to form during the month of April 2025.
The green vertical dashed line on the monthly chart below.
In conclusion.
To sum it all up, the SP500 index is still in a bullish phase.
However, we expect the 20-week cycle low to form soon.
After this low is established, we can anticipate a rally toward the peak of the 18-month cycle.
