Short Term Trading Member Forum

[Blackbelt1]

Airedale/Cash: What is your anticipation concerning the holidays messing with the cycles again? Last year, the rally plus holding until after the New Year delayed the 20-week low. Could it happen again?

I know the cycles we're looking at now are larger/stronger down, but with the bullish signals this market is sending, we could see some interesting market action. For example, one scenario would that the market pushes to a peak in November (after the 2.5-week low upcoming) and then declines fairly steeply into upcoming 5-week low expected December 1 (+/- a few days). Following the 5-week low, we could see a decent attempt at a Santa Clause rally followed by a flat to slightly declining market into the New Year. Then, we might see a repeat of last year's action with a heavier selloff into the 80-week low.

So I see two distinct scenarios: 1) The one laid out above. 2) A more traditional selloff into the 80-week low beginning just after Thanksgiving and completing around January 9. In this scenario, any rally attempt out of the 5-week low would fizzle.

Of the two, the most likely is the first. That is how I will play it, while watching for any signs that the market is choosing option 2.

Belt