A bullish turning point in the S&P 500. That’s hard to believe, right? It is, with government shutdown risk, rising crude oil prices and fear for a stock market crash, bearish sentiment starts dominating again. While these risks are for real, we prefer to stay focused on the chart(s). Based on our extensive research, analyzing turning points over the last 30 years, we have a very simply way to know if/when a bullish turning point is underway… and confirmed.
Turning point analysis is a topic that is center-stage in our premium research writings. In our stock market analysis writings Momentum Investing we include turning point analysis as a recurring topic in all weekend editions.
To illustrate this we feature this public post: Forecasting The Next Bearish Turning Point. Hint: No Secular Bearish Turning Point In 2023. In our public blogs we went to share only isolated insights from our premium research service, to give a sense of what we cover.
Based on our meticulous analysis of leading indicators and chart patterns, our forecast for 2023 remains generally positive. We do not foresee a market crash; instead, risk assets are expected to perform well. Sector rotation will likely be a dominant theme, driving specific sectors higher at different times, while not necessarily moving concurrently. Moreover, the upcoming volatility window in 2023 is not anticipated to trigger a crash or a bearish secular turning point.
Also, in December of 2022, when the entire investor community was bearish, we calculated specific dates, based on turning point analysis, to know exactly which dates would confirm the bullish intent of the market, particularly in the month of January. It worked like clockwork!
In the latest Momentum Investing alert, sent to premium members yesterday, we shared a simple to follow tip that helps them understand if and when a bullish turning point in the S&P 500 is confirmed.
One quote from the detailed analysis available in our restricted research area Downside Targets Are Being Hit – Selection Of Potential Momentum Stocks For Q4:
In case the S&P 500 develops a turning point, within the purple box indicated on our chart, we must see one of the following 2 developments unfold in the coming days and week:
- Three large wicks (intraday reversals) near 4300 points (SPX futures) printed within a period 5 days.
- Two large wicks (intraday reversals) near 4300 points (SPX futures) and one large green candle within a period of 5 days.
The chart says it all: we might be in day #2 of a 5-day bullish turning point. Confirmation, in case this turning point is successful, by coming Tuesday.
Note that the purple box is the downside target, a combination of price/time, that we forecasted almost two months ago. It was made available to our premium members back in August.