Now the stock markets bulls are safe and happy again for a few months. Today I would like to show you where the next important bull market cycle which started the day before the US presidential election, should continue in terms of price and time before a new monthslong bear market (-20% and lower) is expected, that would have to re-test the annual 3000 pts support magnet in a very classical way.
For simplicity's sake let's call this newly triggered bull market cycle the Biden Rally...
To start with this important GUNNER24 Forecast and to work out at what S&P 500 price level the Biden Rally is likely to exhaust we take a close look to W.D. Gann`s Financial Master Plan that originally was compiled by him in 1909. The guide, to how the individual trading years should behave:
And we can see that these predictions are so correct for the secular bull market, which is currently in its 11th year, that we should assume with some degree of certainty that next year, from a general perspective, prices will decline for the most part until another important bear market low is found.
The Master Plan forecasted the beginning (2009) of now underway secular bull, the important higher 2015-2016 bull market lows and finally to the T the unusual strong rally year of 2019 which was panic buying time frame as markets literally just rallied from very first into very last trading day of 2019.
The guidelines for current 2020 have also been met, were even exceeded, as the hardest, fastest bear market ever ended at March coronavirus panic lows, followed by an absolute buying panic, the so often strained V-reversal, what is now being continued with the Biden Rally cycle which now leads to even higher alltime-highs.
For this S&P 500 topping analysis, I would like to work with the GUNNER24 Charts on yearly base. This will continue to be an extreme exception, as this knowledge is normally reserved only for paying traders. However, a serious analysis of the S&P 500 in this particular case is only possible with this annual knowledge.
Lastly, on March 15, 2020 (GUNNER24 Newsletter: „Fathoming this crash cycle – Possible crash cycle panic lows") we were able to estimate the probable bottom of the February-March sell-off cycle quite accurately with the help of this yearly 35 Candle GUNNER24:
The 2020 bear market started after the to the T work off of lower line of 2nd double arc what is natural bull market main uptarget and main resistance out of the # 1 // 60.96 pts // year 1974 Low. In the end, the market found its March 23 coronavirus panic resp. its bear market lows in the middle of the 1st double arc support area, thus has very successfully tested back the prior finally overcome 1st double arc, a former important resistance area on yearly base.
In the tailwind of the Biden elect, the S&P 500 was able to overcome the pre-corona alltime-high resistance, that was triggered by the yearly GUNNER24 Resistance of the lower line of 2nd double arc. The market with the current 3557.54 pts is already trading very far above this lower line of 2nd and at the same time is far above the 2*1 Angle, what was a very important resistance on yearly base as it braked at final highs of 2019.
The decisive elimination of these two (former) main resistances is an expression of the current bull strength and purchasing power. And I think it will be the case that nothing and nobody can prevent the market from closing this year 2020 well above these two rails.
So the year 2020 will be able to deliver another buy signal on annual base. Therefore the year 2021 will inevitably:
First: Print higher highs than the year 2020!
==> Second: Has to test and work off the now activated upper line of 2nd double arc uptarget resistance at 3840 pts with a probability of well over 90%.
With the analytical steps above we have now identified the very first magnets where the final high of the next year could be made! The horizontal highlighted above, what is another „natural" yearly uptarget for 2021 and sits for ever at around 3755 points, likely will be only a "less important" GUNNER24 Uptarget for the coming year, just as this following 3772 points GUNNER24 Horizontal should represent an 2021-important = yearly, but rather minor coming battleground:
This above yearly bull market measurement is an unusual 24 Candle up starting at # 1 // 60.96 // 1974 Low which does not mean that it does not work and can`t be used for predictions and signals. On the contrary!
Because here the 1st double arc main resistance nailed the Dobule Top on DECADE base of the years 2000 and 2007 what led the market drop in the course of the financial crisis into the 100% accurate backtest of the 1*2 Support Angle (MILLENIUM main support) and into the final low of the year 2009 what is the starting point of the current 2009-2021 bull run.
2020 panic cycle lows was the next backtest of the former finally upward broken 2nd double arc zone. This triggered the 2020 V-shaped panic buying and in the tailwind of the Biden elect the natural uptarget = main resistance of lower line of 3rd double arc was overcome and Biden Rally top found natural uptarget main resistance of upper line of 3rd.
This above yearly 24 Candle up reveals WHY the market is faced with some bigger resistance problems actually as it behaves little bit choppy and is leaning to the negative side for the most part of the 2 gone trading weeks ==> the 2 Rally-Mondays triggered by the vaccine news found yearly resistance exactly here at this upper line of 3rd rail!
But this upper line of 3rd will be broken in further course cause it usually is only another minor yearly threshold and normally will be finally overcome at the offical close of 2020 at latest and this would mean a next yearly buy signal and as a consequence of this we have to expect higher 2021 alltime-highs etc..., and this is why the S&P 500 is expected to continue the Biden Rally cycle for:
First, the natural yearly GUNNER24 Horizontal Resistance out of highest price of lower line of 3rd double arc what runs for ever at 3772 pts. That 3772 pts resistance horizontal is just another minor yearly uptarget, IMHO.
==> Second, and this is another major uptarget and potential turning point for the 2021 Biden Rally cycle, into the 3970 pts! The test and work off the major 3970 pts has a probability of about 65%.
Ok. Gann`s Financial Master Plan is forecasting lower prices for coming 2021. The year 2021 will be the 12th year of the secular bull market what started at # 1 // 666.79 pts // final low of 2009 that was triggered by 1*2 Support Angle and 2009 ITL out of 1974 Low which both have formed MAJOR price time support magnet close to the evil 666. Next below is the yearly setup which measures exactly this then 12 year old secular bull market.
This setup is probably the most important in terms of the coming/awaited 2021 Biden Rally top turning point, uptarget and the 2021 bear market downtarget because it is concentrated only on the then 12 years old secular bull market. It focuses ONLY on the then 12-year secular bull market dimensions:
We have a textbook yearly 8 Fib number Candle up, starting at # 1 // 2009 bear market lows. Setup is fully confirmed as final high of 2018 (# 10) found exact resistance at lower line of 1st uptarget and the 12th year candle of the secular bull playbook like tested back the combined support magnet of Blue Arc and first square line.
Also within this setup the # 12-coronavirus panic lows have found a yearly support and natural backtest target.
==> So we now count a total of 3 valid yearly GUNNER24 Up Setups where the 2020 coronivirus spike low found natural = important = very strong backtest support zones which were all tested back very successfully at the same time. Because of this, and only because of this unusual support nest on yearly & DECADE base, the unusual second panic cycle within just one trading year could unfold, or the V-shape rally energy and the Biden rally were allowed to be triggered.
# 11-2019 close is far above the 1st, by 2018 high confirmed 1st double arc resistance area. That # 19-close activated the lower line of 2nd double arc as next important major uptarget of the bull. And well, the 2020 bull market continuation candle is now in striking distance to this perhaps most influencing resistance rail. After price was able to reach such lofty levels the lower line of 2nd uptarget should now have mutated into an irresistible upward magnet that the price can no longer resist.
The highest price of the upper line of 2nd double arc forms the for sure future important GUNNER24 Horizontal at 3930 pts. The upper line of 2nd itself runs at the round 3900 pts for the coming # 13-2021!
This is a very tight upward target nest here at 3900 and 3930 and because of this double resistance magnet we should expect the Biden Rally to exhaust here at the 3900-3930 pts.
==> GUNNER24 Hottest Tip for the printed final 2021 highs is the 3900 to 3930 yearly resistance magnet.
Last but not least here is the time analysis:
The secular bull market started in March of 2009, therefore regarding the time factor the March 2021 offers itself as most attractive month for a final Biden Rally top. The perhaps due 1-year cycle top has to be expected to be printed towards the end of March 2021. From March 2020 lows to an major important March 2021 top (always give 1, 2 weeks before resp. earlier)!!?
Some other cycle studies add to the outcome that the final high of 2021 will be reached sometime between January and April. But rather earlier in this time window than later.
Maybe you have already counted this enitre secular bull market?
==> The next year candle will be the 13th year candle of the secular bull. So it is TURNING TIME regarding the Fib number sequence what is therefore in wonderful harmony/agreement with Gann`s Master Plan for 2021 what projects a red trading year!
In an ideal traders and investors world, the hottest turning point of March 2021 would unite with the hottest bull market price target main resistance of the 3900 to 3930 and this looming powerful trend reversal event would trigger a several-month bear market, which, as far as the S&P 500 is concerned, would have to test back the round 3000 pts/yearly 1st double arc backtest magnet, maybe even the 2950 - quite normally, quite orderly and without panic - before the bulls would once again flood the dance floor!