This is not the first time we look into the S&P500 (SPX) from a multi-decade perspective. Every time we look into the Cycles since the Great Depression we bring an additional element to the table. This time we break down parts of those Cycles even more and look into the RSI as well. This analysis will attempt to shed light into the doubt of, perhaps the majority of the market, whether or not stocks are out of the 2022 correction.
** Bear and Bull Cycles ** As you see since 2029 and the Great Depression, the index has formed three Bear and three Bull Cycles. We are currently on Bull Cycle 3. When the price breaks above the Bear Cycle Top, the Phase 1 of the Bull Cycle starts and has historically lasted 85-89 months (ends with the first major correction). Phase 2 (orange Rectangle) which starts straight after and ends on the second major correction, lasts within 31 - 35 months. Phase 2 typically ends around the middle of the Bull Cycle.
** The RSI recurring patterns ** Besides the above Cyclical symmetry, the 1M RSI has been extremely consistent throughout these Cycles. As shown, the Bear Cycle Bottom breaks well below the 30.00 barrier and touches 20.00 (extremely oversold conditions). The Bull Phases 1 and 2 are formed while the RSI is on Lower Lows.
** Conclusion ** From the above characteristics and parameters, we can easily draw the conclusion that the 2022 correction was Phase 2 of the Bull Cycle and we won't be seeing its bottom in a very long time. More specifically not before 2031, as Bull Cycles 1 and 2 formed their Tops a little after Fibonacci 2.5 time extension. On Bull Cycle 3 (current) this is on January 2031.
This is in our opinion the ultimate S&P500 cheat-sheet and the reason you may invest with no fear. What do you think?
The rise of the bull market :) One of the best analysis I have seen so far :)
satiev1
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Historically every time the fed did a pivot on rates s and crashed at least 30-40 percent
CBKWahoo
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Those are pretty distinct and clear macro fractal cycle patterns right there!
balla.tomas007
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i was looking at same things, just little bit longer 2031 or so. BTC was created at the bottom of bear cycle 3 , 2008/2009. It looks like we are in half of the bull market according to history , if this plays out the same way ( it doestn have to of course :D) . But if so, crypto should follow stock market as well right ? so another 7 years of bull market. Where BTC and crypto overall could go if we are just in half of this bull market ?
SpaceXJack
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I like this and I am currently invested in stocks but my instinct tells me something will decline later this year based on current stagflation and can’t continue the way it is till 2030. But we can only soon find out, thanks for sharing!
spacepoliceman
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My personal bias based on macro economic fundamentals, geopolitical risk vehemently disagrees. Meanwhile, your Technical Analysis along with price action from chart says otherwise. Conclusion: i should discount, ignore the biased, untradeable data and go long. Besides, the herd is seldom correct and currentley net short.