S&P 500: Hurst Cycles - 13th December 2022

Stock markets fall into the 80 day nominal low in varied fashion. The excellent 20 week nominal component has potentially peaked too, we look at the evidence in this report on the S&P 500.

Tools required: Nominal Model | FLD | FLD Trading Strategy | FLD Trading Strategy (Advanced) | Principle of Nominality | Underlying Trend

Analysis Summary

The S&P 500 has made a sideways, turgid trough for the first 80 day component low of what is highly likely now the first move in an 18 month component that bottomed in October this year. Price is currently finding some support around the 80 day FLD (short term chart below), a typical interaction at this stage of the 40 week component (see trading strategy below).

At the long term the 18 month component, if it indeed did form in October, is running at around 15.4 months average wavelength over the period. This sets up the larger low, assumed to be the 4.5 year component, at the end of 2023 and into early 2024. That period, if the phasing is accurate, is likely to be tumultuous.

There has been general support around the 4.5 year FLD (orange on long term chart) for the most recent 18 month nominal low and this sets up a cross of that FLD …