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S&P 500 Index Cash Summary Analysis
By: Marty Armstrong | December 29, 2018

Analysis for the Week of December 31, 2018

ANALYSIS AS OF THE CLOSE Fri. Dec. 28, 2018: S&P 500 Cash Index closing today of 248574 immediately is trading down about 7.02% for the year from last year's closing of 267361. So far, we have been trading up for the past 2 days since the low made on Wed. Dec. 26, 2018. We have advanced 5.10% from the previous day implying the market is still very strong. We did exceed the previous session's high and closed lower. Nonetheless, the market remains quite weak. (Note: We have included reference to Reversals and Short-Term timing considerations in this Summary Analysis, but please keep in mind this is a preview only - these references will be removed from Summary Analysis and moved to our higher levels of market analysis upon the upcoming launch of our expanded platform service.)

Turning to the broader cyclical outlook, the map of the future is certainly interesting. Our target last year, in fact, proved to be an upward trading year yet closed above the previous high. This year was the next target due for 2018. We do see this year as a possible turning point so how we close will be important. The subsequent target for a turning point will be 2019. At this time, the market is trading below last year's close of 267361 which is bearish. Furthermore, the market is trading below our Dynamic Pivot Point for this year 1793516, which is negative. Remember that the key indicator remains the Yearly Reversal System. The next Yearly Bearish Reversal resides at 142618 which is 42% just below the current price levels warning that a year-end closing beneath that level would signal the start of an official bear market trend.

During this year, we have exceeded last year's high which formed the new historical major high to date and we have been in a bull market for a very extended period of 67 years. The last major cyclical low took place in 1974 from which we have witnessed a 44 year broader-term rally. On the shorter-term perspective, the last minor cyclical low took place in 2016 from which we have experienced a 2 year rally.

Meanwhile, our technical resistance stands at 327445 and it will require a closing above this level to signal a breakout of the upside is unfolding. Making use of our Reversal System, our next Weekly Bullish Reversal to watch stands at 280454 while the Weekly Bearish Reversal lies at 241560. This provides a 13% trading range. Turning to the broader Monthly level, the current Bullish Reversal stands at 279148 while the Bearish Reversal lies at 268235. This, of course, gives us a narrower trading range of a 3.90%. Immediately, we closed the last session trading at the 248574, which is below this level on a daily closing basis at this moment. We need to close above this on a weekly basis to signal a rally is unfolding. Right now, the market is trading some 11% beneath that level.

A possible change in trend appears due come February 2019 in S&P 500 Cash Index so be focused. The last cyclical event was a low established back during October. Normally, this implies that the next turning point should be a reaction high. However, so far this market has already broken that previous low established at 260354. This strongly implies we are in a cycle inversion process, which tends to be rather bearish overall. Last month produced a neutral inside trading range from the previous month but closed on the positive side. Immediately, we have broken beneath last month's low. So far, this is still a reaction decline. Nonetheless, penetrating this month's low next month and closing lower would hint of a further decline just ahead going possibly into February. However, the market has bounced some 5.93%. We now need to close below 263109 on a monthly basis to imply a technical reversal of trend to the downside for now.

Our Daily level momentum is bullish while the trend indicator is bearish providing a mixed short-term posture for the market. Turning to the broader picture, our long-term trend and cyclical strength indicators are both bearish reflecting resistance forming at 235110.

On the weekly level, the last important high was established the week of September 17th at 294091, which was up 32 weeks from the low made back during the week of February 5th. This was a key week for at least a temporary high on the Pi cycle. We have been generally trading down for the past 7 weeks, which has been a significant move of .1664%.

Looking at this from a broader perspective, this last rally into the week of November 5th reaching 281515 failed to exceed the previous high of 294091 made back during the week of September 17th. That rally amounted to onlyone week. Subsequently, the market has breached that low of the week of October 29th and has closed beneath it warning the market is weak. Since then, the market has consolidated for the past 7 weeks. Right now, the market is below momentum on our weekly models casting a bearish cloud over the price action. Looking at this from a wider perspective, this market has been trading up for the past 2 weeks overall.

At this moment, this market is in a downward trend on all our indicators looking at the weekly level. Honing in on the direction of this trend, we had been moving down for-3592 weeks. Subsequently, the market has consolidated for the past 3599 sessions. The last high on the weekly level was 281515, which was created during the week of November 5th. The previous weekly level low was 260354, which formed during the week of October 29th, and has now been broken in the recent decline. However, we still remain below key support and key resistance now stands at 271051 above the market.

Looking at a broader time horizon, this market is in an uptrend position on all our monthly indicators for the near-term trend. We see here the trend has been moving up for the past 33 months. The previous monthly level low was 181010, which formed during February 2016, and only a break of 260354 on a closing basis would warn of a technical near-term change in trend. The last high on the monthly level was 294091, which was created during September. However, we still remain below key resistance 274224 on a closing basis.

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