In this edition of the weekly blog, we will drill down into the performance of the S&P 500 for the month of January 1962 to see if we have any “vibration” with some recent swing highs and lows in the market.
Using available data, we see these swings in January 1962 for the S&P 500. 1961 closed the year at 71.55 for the Index. In January 1962, the market hit a high on the 2nd at 71.96, a low on the 8th at 68.17, a high on the 12th at 70.17, and a significant low on the 24th at 67.55. A rally ensued with a high of 71.13 on February 16th.
The closing level for January was 68.84, a decline of -3.79% for the month. But from the January 2 high of 71.96 to the significant low of 67.55 on the 24th, the market was down -6.13% before a rally started.
What we see is a high in early January and a significant low on the 24th. We now review our constructed spreadsheet to look for potential confluence in patterns. (To review, the spreadsheet takes a 365 day/360 degree circle and divides it into quarters, thirds, and smaller divisions of those time periods. A quartering is a season of 91 days/90 degrees, and half that is 45 days/degrees. A third is 121 days/120 degrees. We use +/- 2 trading days either side of exact).
With a little bit of hindsight, we see that the S&P 500 hit a high on January 4, 2022, the second trading day of the year. New money for a new year was put to work. Selling then ensued. Looking back 360 degrees of time, January 4, 2021, was a high; looking back 240 degrees, May 7, 2021, was a high; looking back 180 degrees, July 7, 2021, was a high; looking back 120 degrees, September 2, 2021, was a high; and finally, 60 degrees, November 5, 2021, was a high.
As of this writing on Monday, January 10, we see a potential swing low developing that aligns with the Monday, January 8, 1962, swing low. Looking back at our spreadsheet, we see a few “hits” for the 10th. 315 degrees back in time, February 26 was a low; 240 degrees back, May 12 was a low; 135 degrees back, August 25 was a high; 60 degrees back, November 10 was a low; and 45 degrees back, November 26 was a low.
In 1962 the market rallied from January 8 to 12. Four days. Adjusting forward that would put us for a potential swing high on Friday January 14. We have these “hits” 360 degrees back in time. We have January 15, 2021, a low; 330 degrees, February 16 was a high; 315 degrees back, March 2 was a high; 225 degrees back, June 1 was a high; 180 degrees back, July 16 was a low; 120 degrees back, September 15 was a high; and 45 degrees back, November 29 was a high.
So looking forward to Monday, January 24, a potential for a significant low, we see the following geometric time confluences, 330 degrees back, February 26, 2021, was a low; 270 degrees back, April 29 was a high; 180 degrees back, July 26 was a high; 90 degrees back, October 26 was a high; 60 degrees back, November 26 was a low; and 45 degrees back, December 10 was a high.
Remember inversions do happen, and what is projected to be a high, can be a low and vice versa. So, this is our roadmap for January 2022: a high on January 4 (already happened), a low the 10th (as we are writing this), a high on January 14, and a significant low on the 24th. Let’s see what happens. Stay safe and happy trading.
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