The Opportunity Is Nigh
A so-called Fibonacci turn window set to begin tomorrow, and a host of other indicators, "suggest a stock market bottom is imminent," according to Steve Hochberg, co-editor of The Elliott Wave Financial Forecast.
Those "other indicators" include Elliott Wave Financial's own sentiment indicator, which is showing oversold readings on par with those registered at past major low points, including October 1987, October 1998, July 1996 and December 1994, he said. Additionally, when mass market magazines such as Newsweek have cover stories about stocks, the market changes its trend within one to three weeks, Hochberg reported. "It will be almost immediate [this time] because the turn window is here."
The turn windows are designed to identify when short-term changes will occur, not which direction the market will go. The theory is that whichever direction the market is going heading into the turn date, it will reverse course thereafter. Given that there's a one-day grace period on either side of a turn window (meaning today could have been its onset), it's pretty evident which way stocks were heading going into the new widow.
I've been remiss in following up, but faithful readers will recall Hochberg has made some well-timed calls here. On Feb. 2 , for example, he forecast the Comp could "retest its Jan. 2 lows and the Dow could break 10,000" in the weeks before the next major turn window, which is now upon us.
The newsletter editor foresees two likely scenarios: That the market continues to rally through the next major turn window beginning April 24, or that it rallies into a smaller window April 2-3, suffers a brief pullback and then rallies again into late April.
Either way, he is confident the rally will be "very strong" and last "at least two weeks." |
