S&P 500 - Market Cycles - 28th February 2023

After the 18 month nominal low was established, is price completing a well overdue 20 week nominal trough? The next few months will be crucial for the longer term outlook, we look at the phasing here

Essentials: Nominal Model | FLD | FLD Trading Strategy | FLD Trading Strategy (Advanced) | Principle of Nominality | Underlying Trend | Time Frequency Analysis

Price finds crisp support at the 54 month nominal FLD in the S&P 500. The 9 year nominal FLD will likely be support for the next 18 month nominal low if the current phasing is accurate.

Analysis Summary

The S&P 500 has continued to lag European indices, tracing out a bullish but lacklustre 20 week component. What is notable about the S&P 500 (and some other global indices) is the excellent support at the 54 month FLD by price over the last few months and out of the 18 month nominal low in October. A support area, such as this, does suggest an accurate longer term phasing, although the surge in the European indices has laid question marks around the 9 year nominal low in 2020. All will be clarified by the summer as the trough of the 40 week component is established, a lower low at that point will precede a collapse, likely to the 9 year FLD. This will also breach the 54 month nominal FLD (shown below on the time frequency analysis) and establish a downside target for those that prefer to trade levels, rather than time. The 54 month FLD has only been breached once since the 2009 lows, at the ‘Covid’ lows in 2020. This is a significant FLD support.