Growth likely to weaken further into early Oct vs Value Array ( [cookie] => a672b3-52064a-8adabc-ede1b5-081abc [current_usage] => 2 [max_usage] => 2 [current_usage_crypto] => 1 [max_usage_crypto] => 1 [lock] => 1 [message] => [error] => [active_member] => 1 [subscriber] => 0 [role] => fsi_macro [visitor_id] => 592580 [reason] => [method] => ) 1
The minor snapback Wednesday wasn’t unexpected given historical data concerning trading activity directly following a 4% decline. However, Tuesday’s huge downdraft looks to have paved the way for an upcoming break of September lows which should occur over the next 2-3 weeks. Volume was concentrated very heavily into downside issues which generated a very high ARMS index reading. However, my own experience following downside reversal days following a bounce is that they tend to be far more bearish than bullish. My own Elliott interpretation has a base case projection for weakness into early October and a possible $SPX decline down to a maximum level near 3685. This would accomplish something important. It would allow this most recent wave lower to mirror the decline from mid-August in both price and time. Such a decline over the next few weeks should form a trading low in early October.
Treasury Yields look to have another three weeks higher
Interestingly enough, from a DeMark perspective, this rally in yields is lining up exactly with the timeframe of early October, just like the Equity cycle we’ve been discussing.
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