I have to apologize for not posting recently.There has been a temporary delay in acquiring the normal information from sources that I use for analyzing the markets. That should be rectified by tomorrow.
We are still working with the idea that the DOW and S&P 500 started new medium-term cycles from their Jan. 29 lows and that the NASDAQ is completing a much older medium-term cycle that is moving quickly towards its final bottom. If this is correct, we will probably see the DOW and S&P 500 make sub-cycle bottoms in conjunction with the final bottom of the NASDAQ. This could be happening now as all three indices are pushing lower this week, and the NASDAQ is leading the way with the steepest drop.
We've been anticipating buying that final cycle bottom in the NASDAQ with the idea that the subsequent cycle could rally to challenge and even exceed this index's all-time high from Feb. 16 (14,167). We may yet do that - as long as the final bottom doesn't get too low. If the NASDAQ falls close to or especially below 11,000, it would mean the market could be turning very bearish and would likely be starting a MAJOR longer-term correction. We also need to watch the current corrective drops in the DOW and S&P 500. If these indices drop below their Jan. 29 lows, it would also be a bearish warning that the all-time highs might be in for some time as a longer-term correction gets underway.
What's a little disconcerting here is that there are no major reversal zones in March. Although it's possible to see a major bottom outside a reversal zone, it would be a little unusual. In other words, there is no cycle driven support for any corrective bottom now until April, although it wouldn't be impossible to get one before then.
I should say here that even if we start to see these indices rally to new highs into the Spring, it looks like those highs would likely top out in late April, and then a MAJOR correction would follow from there. The bottom line now is that it is VERY LATE in some of the longer-term cycles of this market, and a MAJOR correction of 30 -50 % (or even more) could be coming soon.
Long-term traders and investors should be getting out of most equity markets now or at the latest in mid-April. We are still on the sidelines of this market with the idea of possibly buying a short-term rally into April, but also anticipating getting out and possibly selling short at a possible top around mid to late April.
Gold and silver prices have been falling dramatically this week. Gold has broken well below our target support of $1767, and silver is now approaching our original target range of $22 - $24. I will analyze the cycles of these two metals over the week-end. If gold is still forming a final bottom in an old medium-term cycle, we may be looking for a buy spot soon. On the other hand, if gold started a new medium-term cycle with its $1761 low on Feb. 19, this market could be turning very bearish. We will remain on the sidelines until this cycle pattern (and that of silver) is more clear.