Since May of 2019 there has been an effective Fibonacci time cycle connecting three S&P 500 (SPX) peaks. The cycle is 336 – trading days, approximately 16 – months. The cycle is based on the Fibonacci time ratio of equality 1/1.
The daily SPX chart courtesy of Trading View illustrates the cycle.
Using the next full moon date 05/05/23 as the anchor and projecting back 336 trading days targets 01/03/22. There was a new moon on 01/02/22, the SPX bull market top was on 01/04/22. This is also an example of a turn on the cusp of a new year.
Projecting back 336 trading days from 01/03/22 targets 09/02/20. There was a full moon on 09/01/20. A short – term top was made on 09/02/20. This is also an example of the start of a seasonal September to October correction within a bull market.
Projecting back 336 trading days from 09/02/20 targets 05/06/19. There was a new moon on 05/04/19. A short – term top was made on 05/01/19. The bullish season ends in early May. Sometimes the subsequent decline only lasts one or two months. In this case one month.
Time cycles can forecast either a market top or bottom. It depends on the market action going into the cycle date that determines a potential top or bottom. The powerful rally off the 04/26/23 bottom is likely to continue into next week.
On 05/03/23 the FOMC will make their next interest rate announcement. The rally after 04/26/23 is likely in anticipation of bullish news. Sometimes market turns occur a few trading days after an FOMC announcement. On 02/02/23 the SPX made a top one day after the FOMC announcement.
Market turns can sometime occur on or near new/full moons.
The bullish seasonal period for stocks ends late April/early May.
The stage is being set for what could be a significant SPX top on or near May 5, 2023.
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