SPX 500 Prices and Targets: December 2018 V March 2020

The S&P’s 500 dropped 600 Points December 2018 and now March 2020, the drop was 900 points. The 2 year currency price cycle applies to stock Indices and all market prices. The key is 2 years. The current March 900 point drop is perfectly in line to the 2 year currency price cycle. The 2018 currency price cycle began in February, off slightly to December 2018 S& P’s or advance warning to February and currency price moves.

The cycle takes 2 years to complete and begins from February /March to April / May about every 2 years. Complete means takes 2 years for maximum overbought or oversold. Next big stock market cycle move is scheduled for February / March 2022.
After the big 2018 and 2020 Stock moves, price becomes settled, normalized, oversold and rests as it requires information to move or breaks at pertinent averages. The settled price, like a currency price, ranges as it lacks a long term target. Previous 2018 and current 2020 drops achieved long term targets. Upon target completion, 2018 and now 2020 S&P prices is now normalized.

From 2018 to March 2020, the S&P’s rose 1000 points from 2300’s to 3300’s to become severely overbought. Both the 2018 and 2020 rise was driven by shortest term 1 year monthly averages. The averages due to short term became overbought quickly, 2900’s in 2018 and 2800’s in March 2020.

For stock indices, the 2 year cycle means the 1 big and easy trade exists to profit much and quickly. The 2 year currency price cycle means many big and easy trades exists to profit much and quickly. No challenge exists, just click.
The December 2018 drop for 600 points is wrong. Actual drop was 400 points and 200 points were unaccounted. The March 900 point drop is wrong. Actual drop was 600 points and 300 points were unaccounted. Actual point drops and percentages is wrong.

Most vital to drops is magic numbers in markets, 300 and 600. The 2018 drop was 400 and 600 points for 2020. A highly normal move. Explains the unaccountability to 2018 at 200 and 300 for 2020.

Bear market is wrong. The 2018 drop was a correction from deep overbought and failed to break the 5 year average at 2300’s. The 2020 drop was a correction and failed to break and sustain the 5 year average at current 2505.25. Only a break at 2505.25 will prices head lower and bear market declaration is correct. Note 2 year and 200 point rise to the 5 year average from 2300’s to 2500’s.

Bear market was declared by analysts and commentators in 2018, same bear market story to 2020. Both are wrong as written in 2018 and now 2020.

Correct forecast for 2018 and 2020. Written in February 2018, updated in December as follows.

Extreme prices located from 2698.59 to 2988.25 and top is 2900.00. The top traded 2942 in September and October 2018, big drop materialized from 2700’s to 2300 in December 2018.

2018 targets are located at 2648.45, 2542.31, 2454.13, 2391.50, 2351.47, 2312.33, 2262.46 and 2213.65. Target achieved at 2348.
2020 trade targets as written in October 2019 as follows: 2955.71, 2904.21, 2869.13, 2813.70, 2742.65, 2681.77, 2646.07. S&P’s traded to 2400;s and 200 missed points as part of the unaccounted points.

Next moves are governed by breaks lower at 2505.25 to target 2420.84 and 2322.15, 2136.55 and 2034.05. Above must break 2638.48, 2766.22, 2867.85 and 2985.27.

Absolute range top is 3138.71. Most extreme is located at 3445.59. Extreme below is located at 2524.95 and just above the 5 year average. Note correct 600 point range from 2505 to 3138.71.

Strategy is long 2524.95 to target easily 2800’s beginning at 2807.63, 2836.83 and 2873.95. Politically, I wouldn’t short a Trump Presidency nor expected re election by 1 point especially if the Republicans gain control of the House.

To gauge the S& P’s by other market barometers then GBP/CHF is the stock market indicator and usually an early warning system. For the VIX, GBP/JPY is the master early warning indicator.

As S&P Prices progress, forecasts will update.

 

Brian Twomey

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