LT wave for Dec 2021

The LT wave did pretty well in November.

Expected strength until the 11th lifted the S&P 500 above 4700 for the first time. But then the move stalled as the weaker period kicked in. The expected strength after the 21st caused a last jump to new record high on the 22nd, but then there was no follow through. This suggests the path of least resistance is turning down and the month ended with some significant down days, which came with the drop in the blue line.

How it is expected to continue is shown in the LT wave chart for December:

The wave stays positive until around the 9th, so I think the market will try to bounce back again in the coming week. If that rebound is weak then it will be reason for extra caution in the subsequent weaker period from the 10th until around the 20th. A Santa rally is projected to come in the final week, but from what level will it start?

It should be an interesting month and if the path of least resistance has indeed turned down then we should see further clues.

Normal caveats apply: don’t bet the farm on LT waves.