The S&P 500 is experiencing a choppy end to its corrective phase, but should ultimately resolve to the upside by the end of April, according to Ron Meisels at Phases & Cycles.
Meisels says the S&P 500 has managed to hold above its early February low at 2,572, the 200-day moving average and its two-year uptrend, possibly completing an A-B-C correction pattern. He does not rule out one more bearish push in April however, which may take the index below 2,572, though he thinks it would be in the form of a climax low on rising volume and act a precursor to a strong bullish reversal.
Overall, Meisels thinks the correction will be complete in April (based on Cycles analysis, probably in the first half of the month) and that the S&P is gradually positioning itself for an extended advance. His only nagging worry is that the 50-day moving average has turned down for the first time in seventeen months and he therefore thinks the market may continue to be choppy in the next few days or weeks. As such, he recommends only the selective purchase of strong stocks that have completed their corrections.
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