Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

DECEMBER

The December forecast suggests a relatively flat month overall, with a period of market indecision expected between the 16th and 18th. The projected directional bias is to the upside, with the month—and the year—anticipated to close with some mild weakness in the final trading days.

DECEMBER’s DOI: 16th-18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader historical annual performance continue to support the outlook for a strong year overall, consistent with market behavior observed thus far. This structural bias aligns with prior cycles where the fifth year of each decade tends to outperform. Similarly, the Kitchin Cycle—a mid-range business cycle of approximately 40 months—suggests a broader upward trajectory is still in play, with the next cyclical peak anticipated around April 2027.

While the Presidential Cycle continues to indicate potential for weakness—particularly typical of the third year of a presidential term—there has yet to be a meaningful correction to validate that risk. As we approach year-end, markets may find some degree of stabilization in December, as is historically common.

The January Barometer, which offers a perspective on how January’s performance can influence the rest of the year, is currently suggesting a slightly negative month ahead. This is expected to play out as an early-month rally followed by a fade into month-end. Meanwhile, the Yearly Market Blueprint supports the idea of a sideways trading pattern through December, with a potential upside bias forming in the second half of the month.

Mid-Term View

Seasonal patterns continue to support a bullish bias. Historically, December has been one of the strongest months for equities, and while we are now at the tail end of it, January has also tended to perform well—albeit statistically less so than December. As we shift into the new year, seasonality remains a constructive backdrop, though with slightly reduced historical tailwinds.

The Dow Jones Utility Index (DJU) also lends some support to the bullish case. It has been moving higher, albeit with minor volatility, and is now approaching a potential cycle peak around January 6, 2026. If this plays out in line with previous patterns, it could signal a less favorable start to the year for equities, suggesting that near-term caution may be warranted.

On the SPX vs. SPX Equal Weight (SPXEW) chart, a subtle yet notable divergence has emerged. While the SPX is pushing toward new all-time highs, SPXEW is lagging—an early signal that market breadth may be narrowing. This kind of divergence has historically preceded periods of consolidation or increased volatility, and it’s worth watching to see if this develops into a broader structural shift.

The outlook on XBD (Broker-Dealer Index) and XLP (Consumer Staples) is more ambiguous. XBD appears to be gradually trending higher, but the move lacks strong conviction. Recent weeks have shown more sideways action with a slight bearish tilt. As for XLP, the picture is similarly unclear. While we’ve seen a higher high, the price action suggests the potential need for another pullback before any meaningful advance—if one is to materialize at all.

Short-Term View

The week began on a positive note with a gap higher, pushing price action above the gradually rising blue trendline—a level that had been acting as a gentle guide for the past several sessions. However, after that initial move, Open Interest (OI) took center stage in shaping price behavior. We’re now approaching a steeper blue trendline—still slower than the broader uptrend—but increasingly relevant in the short term. Just above lie key OI resistance zones, marked by green lines on the chart.

Will the market push through these levels? At this stage, it seems unlikely. The OI map reveals a significant concentration of positions around the $7,000 level—a clean, psychological round number. Not surprisingly, traders have also clustered activity around other round figures like $6,500 and $7,500. That’s typical behavior, as such levels tend to act like magnets for price. Interestingly, we’re also seeing a rise in OI just below current price, suggesting that some participants may be positioning in anticipation of a shift—or at least hedging their bets.

At the moment, the strongest gravitational pull is coming from the OI concentrations above current price. But once those are absorbed or unwound, the OI below could begin to exert more influence—possibly setting the stage for a retracement or period of consolidation.

Lastly, there’s something worth mentioning on the VIX front. As circled on the chart, the VIX has now dipped below its typical “Normal” zone and entered what could be called the “Very Calm” range. Pull up your own chart—regardless of provider—and you’ll notice this isn’t a place it tends to linger. Historically, extended stays in this low-volatility zone are rare and often followed by a spike in volatility or at least a shift in tone. A low VIX means market insurance is cheap—implied volatility is subdued, and options premiums are relatively low. If you’re considering hedging or positioning for potential volatility ahead, the question is: what are you waiting for?

What’s Ahead

As we approach the final trading days of the year, we’re exiting the earnings warning season, and notably, there are no options expirations on the immediate horizon. U.S. markets will be closed on January 1, 2026, in observance of New Year’s Day. With end-of-month flows in play, we may see some portfolio adjustments—particularly tax-related activity. In the final days of December, investors often look to harvest losses by selling underperforming positions. Conversely, in the early days of January, we could see some profit-taking on winners, allowing investors to defer capital gains taxes into the 2026 tax year, payable in 2027.

EVENTS

• 30th December 19:00UTC FOMC Minutes
• 31st December 2025 13:30UTC Initial Jobless Claims

Outlook & Expectations

Looking ahead to next week, the bias remains modestly bullish. That said, some pause or sideways movement wouldn’t be surprising as markets gear down ahead of Christmas. If the upward scenario plays out, it likely takes the form of a slow, possibly uneven climb, with $6,925 as a reasonable upside target. Given the shortened week—early close on the 24th and full closure on the 25th—there’s little reason to expect a push toward the more ambitious $6,985 level. Conversely, if sentiment sours and we see downside pressure, support around $6,720 should hold, barring any surprise catalysts.

The final full trading week of the year kicked off with a solid rally, marked by a gap higher that pushed prices away from the slower-rising blue trendline. The move was notable in its strength early on, but momentum faded once markets reopened after Christmas—almost as if traders were still recovering from holiday indulgence. We closed the week at $6,929, nearly spot-on with the forecasted target of $6,925, which I’d consider well within the margin of an acceptable call. Friday also delivered a fresh all-time high, closing the year on a technically strong note.

As we look ahead to the shortened final week of the year and the start of 2026, it’s time to consider a shift in bias. While retail traders often enter the new year with renewed optimism—driven more by sentiment than positioning—under the surface, institutional behavior may tell a different story. There are technically only three trading days left in December, which leaves a narrow window for tax-loss harvesting, where investors sell losing positions to offset capital gains.

That said, in a year like this—where markets have risen steadily from March onward—losses are scarce. In fact, if someone is sitting on a “loser” in this kind of environment, they’d probably have been better off buying just SPY and skipping individual names altogether. Many stocks have significantly outperformed the index, so it’s reasonable to assume that meaningful tax-loss selling will be limited.

On the other hand, I do expect to see more activity on the tax deferral side. Investors sitting on strong gains may look to trim winners in early January, effectively pushing their capital gains into the 2026 tax year (reportable in 2027). This type of selling pressure, especially in the first few sessions of the new year, could weigh on markets temporarily—even if the broader trend remains constructive.

Technically speaking, I wouldn’t be surprised to see the week start with a continuation higher, potentially testing the faster-rising blue trendline or even reaching the Open Interest resistance level around $6,974. If price stalls or rejects at that level, a pullback scenario becomes plausible. In a more extended downside move, support doesn’t come in immediately—$6,797 could be a potential downside magnet if selling accelerates. If bearish momentum doesn’t materialize, a stall below $6,974 remains the more probable outcome for now.

Finally, time permitting, I plan to publish a full “End of Year” review on January 1st, recapping what worked in 2025, what didn’t, and presenting the initial forecasts for 2026. The January Barometer will, of course, be addressed at the end of next month. If the review isn’t published on the 1st, you can expect the 2026 forecast to be included in next Friday’s regular article.

Wishing you all a strong finish to the year—and a strategic start to the next.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

DECEMBER

The December forecast suggests a relatively flat month overall, with a period of market indecision expected between the 16th and 18th. The projected directional bias is to the upside, with the month—and the year—anticipated to close with some mild weakness in the final trading days.

DECEMBER’s DOI: 16th-18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader historical annual performance continue to support the outlook for a strong year overall, consistent with market behavior observed thus far. This structural bias aligns with prior cycles where the fifth year of each decade tends to outperform. Similarly, the Kitchin Cycle—a mid-range business cycle of approximately 40 months—suggests a broader upward trajectory is still in play, with the next cyclical peak anticipated around April 2027.

While the Presidential Cycle continues to indicate potential for weakness—particularly typical of the third year of a presidential term—there has yet to be a meaningful correction to validate that risk. As we approach year-end, markets may find some degree of stabilization in December, as is historically common.

The January Barometer, which offers a perspective on how January’s performance can influence the rest of the year, is currently suggesting a slightly negative month ahead. This is expected to play out as an early-month rally followed by a fade into month-end. Meanwhile, the Yearly Market Blueprint supports the idea of a sideways trading pattern through December, with a potential upside bias forming in the second half of the month.

Mid-Term View

Seasonality continues to offer a supportive backdrop. Historically, December ranks among the strongest months for equities, with roughly 73% of past instances closing higher—statistically skewed in favor of the bulls. While seasonality is far from a crystal ball, it does add a layer of context that leans optimistic, especially when paired with prevailing upward momentum.

From a broader macro-technical perspective, the Dow Jones Utility Average (DJU) still tilts toward the upside in the near term. However, looking beyond January 6th, the start of the new year doesn’t exactly scream “risk-on.” That said, a soft patch in Q1 is historically normal in this cycle, and if patterns hold, a more pronounced decline is likely waiting in the wings for Q4 of 2026. Not a crash call—just a calendar quirk with precedent.

As for the SPX Equal Weight Index (SPXEW), there’s little divergence to speak of. It’s moving in lockstep with the cap-weighted SPX, signaling that breadth is healthy but not spectacular. Historically, December tends to favor small caps over large caps, but so far, the charts aren’t making that case too loudly. Importantly, we’re still lacking a definitive higher high on the SPX, which remains the technical threshold for confirming the current uptrend.

On the sector level, the Broker-Dealer Index (XBD) has started to turn higher again—generally a good sign for risk appetite, as financials often lead. In contrast, the Consumer Staples ETF (XLP) is showing more hesitation, still etching out lower lows. While there may be a case to be made for a double bottom at current levels, it’s premature to call a trend reversal until that pattern resolves more convincingly.

Short-Term View

Friday’s close managed to edge just above the fourth, slower-moving blue trendline—technically a bullish signal, but with a caveat. These trendlines can often act less like springboards and more like magnets, pulling price action toward them and encouraging a slow, measured climb. We’ve seen this behavior before: price hugging the line with mechanical obedience, rising—but doing so with restraint rather than exuberance.

On the options front, last week delivered a clean unwind of the sizable open interest (OI) that had accumulated below current levels. Was it expiration-driven? Profit taking? Most likely a blend of both, especially considering the selloff that persisted into midweek. The real shift, though, lies in the current OI landscape: the bulk of positioning has migrated above the market, creating a new gravitational pull. As always with OI, these levels tend to attract price—acting like targets more than barriers.

As for volatility, the VIX remains unremarkably low. There’s little of note on the chart itself, other than the ever-present possibility of short-term spikes. In practical terms, that sets the stage for a potentially choppy ride—especially if complacency begins to overstay its welcome.

What’s Ahead

We’re into earnings warnings season, a time when corporate guidance tends to darken the mood just enough to keep volatility alive. Notably, there’s no options expiration to stir things up this week, removing a usual catalyst from the mix. Markets will observe the Christmas holiday, closing early at 18:00 UTC on the 24th and fully shutting down on the 25th. With no end-of-month flows on deck either, liquidity could thin out, leaving price action more susceptible to headlines and sentiment swings than structured rebalancing.

EVENTS

• 23rd December 2025 13:30UTC GDP
• 24th December 2025 13:30UTC Initial Jobless Claims

Outlook & Expectations

Historically, a red Friday tends to lead into a red Monday, and that’s the scenario I’m leaning toward. As for direction, I don’t expect a clean break below the $6,743 level. From there, we could see the upside resume, potentially ending the week higher, around the $6,936 mark. However, with the holiday mood setting in, there’s a chance market enthusiasm could push us through the $6,992 level. On the flip side, if there are no meaningful signs of a bounce by Tuesday or Wednesday, I’d expect further downside, possibly extending toward the $6,674 area.

Monday opened the week with a red candle, and that weakness carried through into midweek—right in line with expectations for a bounce around Tuesday or Wednesday, especially with December-dated DOIs stretching from the 16th through the 18th. In reality, the market made us wait a bit longer, with the bounce finally materializing on Thursday. The anticipated low was pegged at $6,743, and price dipped slightly below, bottoming at $6,720 before turning. While the forecasted weekly high was set at $6,936, we closed at $6,833—falling short of that target. So while the bounce itself and its general timing were reasonable, the misfire on “bounce day” likely contributed to missing the upper boundary projection.

Zooming out, the monthly chart still shows signs of underlying bullish momentum. The weekly chart, however, offers less clarity, lacking a decisive directional bias to guide positioning with confidence. The upcoming week also marks the technical start of the so-called “Santa Claus Rally”—typically defined as the last five to six trading days of the year (depending on your source) and the first two sessions of January. That puts the launch window either on the shortened session of December 24th or the regular session on the 26th, assuming the seasonal pattern decides to show up this year.

Across timeframes, the outlook leans cautiously constructive. Longer-term signals still suggest bullishness, though some contrarian indicators are worth noting. Medium-term momentum is skewed more bullish than bearish. Short term remains in favor of the bulls, albeit with potential choppiness—thanks to both trendline-following price action and a persistently low VIX.

Looking ahead to next week, the bias remains modestly bullish. That said, some pause or sideways movement wouldn’t be surprising as markets gear down ahead of Christmas. If the upward scenario plays out, it likely takes the form of a slow, possibly uneven climb, with $6,925 as a reasonable upside target. Given the shortened week—early close on the 24th and full closure on the 25th—there’s little reason to expect a push toward the more ambitious $6,985 level. Conversely, if sentiment sours and we see downside pressure, support around $6,720 should hold, barring any surprise catalysts.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

DECEMBER

The December forecast suggests a relatively flat month overall, with a period of market indecision expected between the 16th and 18th. The projected directional bias is to the upside, with the month—and the year—anticipated to close with some mild weakness in the final trading days.

DECEMBER’s DOI: 16th-18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader historical annual performance continue to support the outlook for a strong year overall, consistent with market behavior observed thus far. This structural bias aligns with prior cycles where the fifth year of each decade tends to outperform. Similarly, the Kitchin Cycle—a mid-range business cycle of approximately 40 months—suggests a broader upward trajectory is still in play, with the next cyclical peak anticipated around April 2027.

While the Presidential Cycle continues to indicate potential for weakness—particularly typical of the third year of a presidential term—there has yet to be a meaningful correction to validate that risk. As we approach year-end, markets may find some degree of stabilization in December, as is historically common.

The January Barometer, which offers a perspective on how January’s performance can influence the rest of the year, is currently suggesting a slightly negative month ahead. This is expected to play out as an early-month rally followed by a fade into month-end. Meanwhile, the Yearly Market Blueprint supports the idea of a sideways trading pattern through December, with a potential upside bias forming in the second half of the month.

Mid-Term View

Seasonality remains supportive. December ranks among the top-performing months, with a historical win rate of around 73% positive closes, and the trend bias continues to point upward. While seasonality does not guarantee outcomes, it does contribute to a broader context of optimism.

The Dow Jones Utility Average (DJU) appears to be signaling strength into early January, with underlying support holding firm. Aside from a brief and shallow pullback following a recent bottom, the structure suggests a constructive outlook until at least January 6th, 2026.

Turning to the SPX Equal Weight Index (SPXEW), there’s little new to highlight this week—though it’s worth noting that recent S&P 500 price action resembles a scallop pattern: a sharp initial rise followed by a gradual, rounded top. It’s a formation worth keeping an eye on, particularly given the number of variables that could influence its development.

On the sector front, both the Broker-Dealer Index (XBD) and Consumer Staples ETF (XLP) appear to have confirmed breakouts above their respective trendlines, further reinforcing the prevailing bullish bias.

Short-Term View

The old black trendline remains intact—months old and still relevant—with last week offering a few noteworthy developments. Price has been steadily tracking along the second, slower blue trendline, forming what appears to be a rounding top. This could represent the final leg of a scallop pattern; however, confirmation would require a close above the pattern’s highest high, which still leaves quite a bit of ground to cover.

The Open Interest (OI) Heat Map continues to show a narrowing in OI levels, a setup that typically precedes a week of limited net movement. That doesn’t rule out a 300-point drop followed by a 300-point rally—in trading terms, ideal intraday action but likely to resolve with little directional progress by week’s end. One important factor to keep in mind is Friday’s options expiration. Since these OI levels span various expiration dates, some of that open interest may begin to unwind as early as Wednesday.

As for volatility, the VIX isn’t offering much directional guidance, though we’ve seen sporadic spikes. As John Bollinger aptly put it, “High volatility begets low volatility, and low volatility begets high volatility.” These recent blips could very well be the sparks that light the anticipated one-to-three day volatility burst.

What’s Ahead

We are currently in the midst of earnings warning season, a period often marked by increased caution and reactive price action. This week also includes a notable options expiration on Friday, which may contribute to heightened volatility and positioning adjustments. As it is the third Wednesday of the month, I would hold off on making any decisions until after 18:00 UTC, allowing for potential late-session developments to play out. There are no end-of-month inflows or outflows to consider, and the calendar is clear of any holidays, keeping market participation relatively stable from a structural standpoint.

EVENTS

• 16th December 2025 13:30UTC Unemployment Rate
• 18th December 2025 13:30UTC Inflation Rate
• 18th December 2025 13:30UTC CPI
• 18th December 2025 13:30UTC Initial Jobless Claims

Outlook & Expectations

No forecasts for the past week were published.

There was no discernible market reaction on December 10th, suggesting that the developments were either already anticipated or effectively priced in. So, what comes next? While my overall bias remains bullish, the Friday close makes me think that we are approaching those 1-3 days of turbulence expected already in the past forecasts.

I may be wrong—especially in December, a month I personally find less favorable for trading. In fact, I likely said the same thing last year around this time, which at least shows a certain consistency. Historically, a red Friday tends to lead into a red Monday, and that’s the scenario I’m leaning toward. As for direction, I don’t expect a clean break below the $6,743 level. From there, we could see the upside resume, potentially ending the week higher, around the $6,936 mark. However, with the holiday mood setting in, there’s a chance market enthusiasm could push us through the $6,992 level. On the flip side, if there are no meaningful signs of a bounce by Tuesday or Wednesday, I’d expect further downside, possibly extending toward the $6,674 area.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

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Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

DECEMBER

The December forecast suggests a relatively flat month overall, with a period of market indecision expected between the 16th and 18th. The projected directional bias is to the upside, with the month—and the year—anticipated to close with some mild weakness in the final trading days.

DECEMBER’s DOI: 16th-18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader historical annual performance continue to support the outlook for a strong year overall, consistent with market behavior observed thus far. This structural bias aligns with prior cycles where the fifth year of each decade tends to outperform. Similarly, the Kitchin Cycle—a mid-range business cycle of approximately 40 months—suggests a broader upward trajectory is still in play, with the next cyclical peak anticipated around April 2027.

While the Presidential Cycle continues to indicate potential for weakness—particularly typical of the third year of a presidential term—there has yet to be a meaningful correction to validate that risk. As we approach year-end, markets may find some degree of stabilization in December, as is historically common.

The January Barometer, which offers a perspective on how January’s performance can influence the rest of the year, is currently suggesting a slightly negative month ahead. This is expected to play out as an early-month rally followed by a fade into month-end. Meanwhile, the Yearly Market Blueprint supports the idea of a sideways trading pattern through December, with a potential upside bias forming in the second half of the month.

Mid-Term View

Seasonality remains supportive. December ranks among the top-performing months, with a historical win rate of around 73% positive closes, and the trend bias continues to point upward. While seasonality does not guarantee outcomes, it does contribute to a broader context of optimism.

The Dow Jones Utility Average (DJU) appears to be signaling strength into early January, with underlying support holding firm. Aside from a brief and shallow pullback following a recent bottom, the structure suggests a constructive outlook until at least January 6th, 2026.

On the SPX Equal Weight Index (SPXEW), there’s little new to report. Both SPX and SPXEW continue to trade below their respective all-time highs. Importantly, we’ve yet to see a meaningful correction that could establish a potential higher low, which would formally mark the end of the broader downtrend and confirm a new structural base.

Sector-wise, XBD (Broker-Dealer Index) and XLP (Consumer Staples ETF) have both broken above their respective downsloping trendlines—often an early signal of a shift in sentiment. These breakouts may represent bottom formations and the beginning of a new upward phase, which could further support broad market strength in the coming weeks.

Short-Term View

From a technical standpoint, the long-standing black trendline and its associated slower-moving support/resistance bands continue to provide reliable reference points. Last week, price action engaged precisely with the second lower trendline, and has tracked it closely—offering a clear example of how well this framework continues to map market behavior.

The Open Interest (OI) Heat Map is highlighting a narrowing range, with price action moving closer to the upper OI cluster. As is often the case, these clusters can act as price magnets, attracting flow—but once reached, they also pose a risk of rejection due to order imbalances.

This contracting range is echoed by the VIX, which has been cooling off steadily since mid-November. It recently reached its lowest level since late September, reinforcing the view that directional conviction is strong. However, should the market enter a consolidation phase, 1–3 day volatility spikes are likely. These are typically the kind of sessions where traders attempt to fade strength or chase breakdowns—and often get punished for it.

What’s Ahead

This week presents a relatively clean setup for markets: no holidays, no options expirations, and no end-of-month flows to skew the tape. With mechanical drivers out of the way, focus turns to fundamentals as earnings warning season gathers pace, putting corporate guidance and pre-announcements under the spotlight. Adding to the mix, Wednesday brings the Fed’s interest rate decision—a potential volatility catalyst.

EVENTS

• 09th December 2025 15:00UTC JOLTs Job Openings
• 10th December 2025 19:00UTC FED Interest Rate Decision
• 10th December 2025 19:30UTC FED Press Conference
• 11th December 2025 13:30UTC Initial Jobless Claims
• 11th December 2025 13:30UTC PPI

Outlook & Expectations

For the upcoming week, I expect the market to continue following the trajectory established over the past several sessions. A more reliable signal should emerge around December 2nd, which is likely to offer greater clarity on whether a retracement is developing or if the upward trend will extend into mid-month. Should a decline begin around that date, a sharp but potentially brief move—lasting 2 to 3 days—could take the market down to test OI support levels at 6,746 or possibly as low as 6,648. On the other hand, if the downside scenario fails to play out, immediate resistance lies at the prior high from November 12th, 2025 at $6,869, followed by the next key level at $6,920 from October 29th, 2025.

I had been anticipating some market activity around December 2nd, but overall, there was little of note. The SPX Equal Weight Index (SPXEW) showed a modest sign of strength on that date—suggesting it still had some momentum—but nothing that warranted significant attention from my perspective. The S&P 500 did test the 6,869 level on Thursday, encountering a slight rejection, and Friday’s session remained close to that area without making a decisive move (close 6,870$).

A few days ago, I had a conversation with a friend who mentioned someone had described me as “doing the market.” In reality—jokes aside—it often feels more like the market is doing me. During our chat, he brought up a series of exotic indicators available on his charting platform—names I’d never heard of, pitched as “bulletproof” tools. I wish that were true; I’d sell everything I own to buy such an indicator. But the truth is more grounded: there is no perfect indicator. Every tool you see plotted is just a derivative of price—based on the open, high, low, or close. In essence, there’s little they can tell you that a candlestick chart doesn’t already contain. Indicators simply organize that data into a more digestible format. The more important question is: what is the indicator actually showing? Is it measuring trend or momentum? Or is it blending both? Simple moving averages are classic trend indicators—they highlight direction over time. RSI? Pure momentum. MACD? That’s more of a hybrid, capturing both momentum and trend-following characteristics. The key takeaway: don’t expect momentum indicators to tell you direction—they don’t. Before adding anything to your chart, ask yourself a basic question: Is this telling me direction, or energy?

Looking ahead to next week, there’s admittedly not much I can say with conviction. Why? Despite my usual habit of tuning out the headlines, the FOMC meeting on December 10th is set to take center stage. A rate cut is expected by the majority, but whether the Fed delivers is less certain. The recent government shutdown delayed key economic data releases, and without a full read on the macro picture, there’s a real possibility the Fed opts to wait.

Now, what that means for me might differ from what it means for you—but for this week’s outlook, I’ll keep it simple and focus on one technical observation.

Following the above conversation about charting and indicators, I revisited my higher time frame setups. The longer-term uptrend is still holding, but early signs of a hinge are forming—price is starting to level out, and the trend strength line is showing a modest decline. Momentum is softening as well. On the medium-term view, the trend still carries a slight downward bias from the past two weeks, but momentum has already started to recover. If that continues, the trend may follow—unless the dominant higher time frame steps in with a firm “you shall not pass.” On the short-term side, the trend is up and momentum remains intact, suggesting there’s still room for continuation.

Of course, everything could shift after December 10th. In a well-defined trend, markets typically digest major news within one to three sessions. But when higher time frames are flat or neutral, reactions—whether up or down—tend to last longer. That’s worth keeping in mind: if the market interprets the Fed’s move (or lack thereof) negatively, the follow-through may extend beyond the usual 1–3 day window.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

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Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

NOVEMBER

At this stage, there isn’t much to add in terms of high-conviction signals for November. The current upward momentum may extend into the 6th, after which a consolidation or digestion phase could emerge, potentially lasting through the 10th.

From there, another leg higher is anticipated, likely carrying through to around the 18th, coinciding with the conclusion of the earnings-driven momentum. Beyond that, the market may shift into a more prolonged sideways phase, which could persist through the end of the month.

NOVEMBER’s DOI: 6th-10th, 18th.

In reference to the November outlook, forecasts initially anticipated a continued upward trend from October, with some expected turbulence between the 6th and 10th, followed by a shift from an upward to a sideways trajectory around the 18th. Now that the chart has been updated, it’s evident that while the directional forecast was inaccurate—as previously noted—the projections regarding timing of volatility were surprisingly precise. Instead of a rise, the market experienced a continued decline from the final days of October, with a brief retracement occurring between the 7th and 12th—coinciding with the anticipated period of turbulence—and a further decline until the 20th, when a directional shift occurred slightly later than the forecasted 18th. Once again, the chart has demonstrated a degree of reliability in identifying potential turning points, even if the directional bias was off.

DECEMBER

The December forecast suggests a relatively flat month overall, with a period of market indecision expected between the 16th and 18th. The projected directional bias is to the upside, with the month—and the year—anticipated to close with some mild weakness in the final trading days.

DECEMBER’s DOI: 16th-18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader annual performance continue to support the outlook for a strong year, aligning with market behavior observed thus far. Similarly, the Kitchin cycle suggests an overall upward trajectory, with the next cyclical peak anticipated around April 2027.

While the Presidential Cycle still indicates potential weakness, there has been no significant correction to date. As we near year-end, some degree of market stabilization can be expected in December. The January Barometer points to a slightly negative month, with an early rally followed by a decline into month-end. Meanwhile, the Yearly Market Blueprint suggests a sideways trend for December, with a potential upswing developing in the second half of the month.

Mid-Term View

November has officially closed, landing among the 40% of instances where the month ends in negative territory. While the decline wasn’t significant, it did fall well short of the historical average gain of +0.9%. Looking ahead, December historically closes in positive territory 73% of the time, with an average return of +1.2%. It’s worth noting that even a modest +0.1% finish would count as a positive close for the month.

The DJU index is now approaching its prior bottom from September 8, 2025—suggesting that the current phase of weakness may be nearing its end. As a reminder, this cycle typically spans around 55 candles, give or take a week. While the December 21st low could theoretically mark the bottom, this tool isn’t intended for precise timing; rather, it serves as a gauge of underlying market weakness, alongside other elements in this analysis.

As a reminder, the SPXEW/S&P500 chart becomes largely irrelevant when there’s no divergence between the two indexes. In those cases, I typically use it simply to see if any additional signals can be spotted elsewhere.

On the SPX Equal Weight Index (SPXEW), I’ve marked what appears to be a head-and-shoulders pattern. The index broke below the neckline, triggering a sharp drop—followed by an equally sharp recovery that ultimately closed above the previous high, as highlighted by the horizontal orange line. That said, an uptrend only confirms when higher highs are followed by higher lows; the latter is still missing in this case.

On the S&P 500, I’ve noted a broadening formation—essentially two diverging trendlines containing the price action. There are countless names for such patterns, but the essence remains the same. The index did manage to close above the upper trendline, yet it has not posted a new higher high, meaning we are technically still within a downtrend for the S&P500.

As for sector signals, both XBD and XLP trendlines remain in decline. There was a tentative bottom around November 20, but this has yet to be confirmed. For now, the trend remains downward.

Finally, the monthly outlook still points to a sideways start to December, followed by a potential rally around mid-month.

Short-Term View

The long-term trendline remains in place, as it continues to serve as a reliable indicator of potential support and resistance zones—effectively highlighting key “walls” and “holes” in price action. Two areas of similar price behavior have been marked in red; if this pattern holds, a minor retracement could be anticipated in the upcoming sessions.

Looking at the Open Interest (OI) Heat Map, overlaying last week’s candlesticks reveals how those levels acted as effective magnets for price movement. For the current week, the trading range has narrowed, accompanied by a decline in the VIX—something I’ll touch on shortly—suggesting limited momentum and reduced potential for significant moves. Price is currently hovering just below a dense cluster of OI slightly above current levels. It’s also worth noting areas of interest slightly below, around the 6750 and 6650 levels, which may exert some pull.

The VIX briefly rose into the “Caution Rising” zone before retreating over the course of the week, settling back into the 15–16 range—a level that has provided support for price action over the past several months.

What’s Ahead

We are currently in the midst of earnings warning season, a period that can introduce increased headline risk and market sensitivity to corporate guidance. With no major options expirations scheduled, that particular source of volatility is absent for the time being. However, early-week price action may still be influenced by typical monthly inflows and outflows as capital reallocation plays out. Additionally, the absence of any market holidays ensures uninterrupted trading sessions throughout the week.

EVENTS

• 02nd December 2025 01:00UTC FED CHAIR Powell Speech
• 04th December 2025 13:30UTC Initial Jobless Claims
• 05th December 2025 15:00UTC Personal Income & Spending
• 05th December 2025 15:00UTC PCE Price Index

Outlook & Expectations

For the week ahead, the current scenario suggests a potential bounce that began on Friday may extend through to Tuesday. During this time, price action could retest the retracement level from the recent high at 6,649, or even push into the clustered zone of extension levels and Open Interest (OI) resistance in the 6,691–6,699 range. From there, possibly as early as Wednesday, the market may resume a downward leg that could extend into the first days of December—potentially bottoming around the 3rd, at which point a stronger uptrend may begin to take shape.

I’ve marked a key level on my chart at $6,759. A daily close above this threshold would effectively invalidate the current bearish outlook and shift the bias. Should that occur, the upside move could be sharp, given the notable gap between current prices and the next major OI resistance levels. Until then, the base case remains cautiously tilted toward another short-term pullback before any sustained upside can develop.

The weekly bias initially leaned slightly bearish, but this outlook shifted on Wednesday when, instead of continuing lower, the market closed above the key $6,759 level—prompting a tilt toward a more bullish expectation. A sharp upside move followed, in line with the prior week’s forecasts, and was confirmed by a nearly 200-point gain around the Thanksgiving period. However, the rally occurred on low volume and during shortened sessions, reflecting limited participation. Under regular trading conditions, a stronger follow-through would have been a reasonable expectation.

For the upcoming week, I expect the market to continue following the trajectory established over the past several sessions. A more reliable signal should emerge around December 2nd, which is likely to offer greater clarity on whether a retracement is developing or if the upward trend will extend into mid-month. Should a decline begin around that date, a sharp but potentially brief move—lasting 2 to 3 days—could take the market down to test OI support levels at 6,746 or possibly as low as 6,648. On the other hand, if the downside scenario fails to play out, immediate resistance lies at the prior high from November 12th, 2025 at $6,869, followed by the next key level at $6,920 from October 29th, 2025.

As we approach the end of the year, I’d like to take a moment to mark a personal milestone: this blog has officially completed its first year. What began as a simple trading diary—a place to organize my thoughts and track market behavior—has grown into something much more. It’s been rewarding to see it evolve and to know that others have found value in the work shared here.

Looking ahead, I’m genuinely excited about what the next year might bring. That said, I’m not under any illusions—continuing this project requires a real investment of time and energy, and like anyone else, I have other priorities in life that sometimes take precedence. So while I aim to maintain consistency, please don’t expect a post every single week. As it stands, 49 posts over 52 weeks is a record I’m more than satisfied with, and one I’ll strive to keep up—realistically, not rigidly.

I also want to take this opportunity to express my sincere thanks to the three supporters who have contributed financially to this blog. Your support has been genuinely appreciated, and it won’t be forgotten. If a paid service or expanded offering ever does take shape in the future, your early support will absolutely be taken into consideration.

Thank you to everyone who reads, follows, and continues to engage. Let’s see where the next year takes us.

Just a reminder: if you’ve landed on this page and immediately scrolled to the bottom hoping to find a quick answer to “what the market is going to do,” you’re out of luck. There’s no magic line here. My approach is deliberately two-dimensional—designed to manage both financial and psychological capital. I understand the probability landscape between potential scenarios, but you won’t grasp that unless you’ve read the analysis above and have been following along for a while.

If you’re just here to speculate and want a shortcut, feel free to reach out—my fee is 99% of your net gains (post-tax), since your effort probably only accounts for the remaining 1%. Relax, I’m joking—I would never trade someone else’s money. The effort it takes just to break even by year-end is immense; beating a major index is an entirely different league. If you genuinely believe someone’s going to hand you the keys to financial freedom with zero effort, you shouldn’t be here reading this—especially since it’s free, and blissfully free of ads. Go pay an “expert” and keep convincing yourself you’ll crush it.

Review the Disclaimer page.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

---

Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

---

Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

---

Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

---

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

NOVEMBER

At this stage, there isn’t much to add in terms of high-conviction signals for November. The current upward momentum may extend into the 6th, after which a consolidation or digestion phase could emerge, potentially lasting through the 10th.

From there, another leg higher is anticipated, likely carrying through to around the 18th, coinciding with the conclusion of the earnings-driven momentum. Beyond that, the market may shift into a more prolonged sideways phase, which could persist through the end of the month.

NOVEMBER’s DOI: 6th-10th, 18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader annual performance continue to support the case for a strong year—consistent with what we’ve observed so far. The Kitchin cycle also points to an overall upward trajectory, with the next cyclical peak expected around April 2027.

However, both the Presidential Cycle and the January Barometer are signaling potential weakness as we move into November and December. In contrast, my current forecasts still favor another leg higher into mid-November, followed by a transition into a sideways phase that may carry through to month-end.

Mid-Term View

As we approach the end of November, it appears this year will be among the ~40% in which the month finishes lower than it began. At this point, it would take a rally of over 200 points to flip that outcome—technically feasible, but statistically unlikely given the current setup.

This also serves as a good opportunity to again highlight the Dow Jones Utility Index (DJU) and its continued value as a forward-looking signal. While I haven’t measured the precise length of previous directional moves, its historical consistency suggests that if the pattern holds, further weakness could extend into next week, with a potential recovery emerging in the early days of December.

Looking at the broader index, the SPX posted a new short-term low that dipped slightly below its October 10th level. While not dramatic, it’s a noteworthy marker in the current context. Meanwhile, on the SPX Equal Weight (SPXEW) chart, I’ve maintained the Head & Shoulders pattern with the neckline clearly drawn. The recent turn appears technically consistent with a pullback, which—if the pattern holds—could see the index retest the neckline from below in the sessions ahead.

Sector-wise, it’s important to clarify that the XLP trendline in the chart is inverted. So while it may appear to be breaking down, the actual interpretation is a show of strength in consumer staples—a classic sign of defensive rotation. Capital moving into staples often reflects growing caution beneath the surface. In contrast, XBD, which was already flagged in last week’s commentary, has resumed its decline after a brief pause. The combination of rising defensives and falling broker-dealers has historically, though not always, preceded turning points in broader market direction. While it doesn’t pinpoint timing, it remains a setup worth tracking.

Lastly, the monthly forecast had called for sideways action beginning mid-month. The model now reads as broadly neutral, offering little additional edge in either direction given the current conditions.

Short-Term View

Technically speaking, the trendline should have been adjusted on the 18th to reflect the shift from an uptrend to a downtrend. The lower high established on the 12th, followed by a lower low on the 18th, confirms the transition. However, the current system of using derived slower and faster trendlines tends to lag during turning points, making it less effective in identifying the establishment of new trends in real time. That said, the previous uptrend line has continued to offer relevance, marking areas where short-term reactions have occurred.

On Friday, the index closed on an even slower trendline, forming a white candle—suggesting the potential for a short-term bounce, at least in the early part of the week. I’ve highlighted in red two areas on the chart that share similar characteristics. Whether the market follows the same script remains to be seen. My base case leans toward a repeat of that behavior, though I suspect the index may need to dip slightly below Friday’s low before a more sustained move higher can develop.

Regarding the Open Interest (OI) Heat Map, I’m still working on resolving the technical issue that’s preventing Friday’s candle from appearing. However, this doesn’t impact the chart’s overall utility. OI remains heavily concentrated on both sides of the current price, but the downside appears less obstructed. In contrast, the path upward faces immediate resistance around the 6,990–6,750 range. This level could act as a short-term magnet, drawing prices higher before a potential reversal into the 6,550–6,450 zone.

As for volatility, the VIX has entered what I label the “Caution Rising” zone. I haven’t added a trendline here, as the uptrend is visually clear. These observational zones serve as both support and resistance levels. For a confirmed reversal in sentiment, I would want to see a candle close back inside the “Normal” zone. As it stands, this setup lends additional support to the view that further downside may persist into next week.

What’s Ahead

In the final week of November, the market transitions from Earnings Season to the less celebrated—but equally impactful—earnings warnings season, where forward-looking statements often carry more weight than past performance. With no options expiration on the calendar, one of the usual sources of short-term volatility is off the table. However, attention may turn to monthly inflows and outflows, which could start to influence price action—particularly in the latter part of the week as asset managers position around month-end. Additionally, U.S. markets will be closed on Thursday, November 27th for Thanksgiving, and will operate on a shortened schedule with a 18:00 UTC close on Friday, November 28th.

EVENTS

• 25th November 2025 PPI
• 26th November 2025 13:30UTC Initial Jobless Claims
• 26th November 2025 13:30UTC Personal Income & Spending
• 26th November 2025 13:30UTC PCE Price Index

Outlook & Expectations

My long term charts are hinging down, medium term charts are already going down. I do not have a setup for a 20% retrace in the Markets, I would add “unfortunately” but weakness could persist into the new week. If it does possible target is around 6648 with a possible pause or change of direction back up on the 18th (November DOI). If it does bounce back up on Monday I would be looking maybe for a powerful recovery back to 6896 always keeping in mind the 18th as a date where a possible change of direction or pause may start.

There was no bounce on Monday, prompting a shift in the target to $6,648—a level that was reached around the 18th, where a pause or potential reversal had been anticipated. A brief consolidation followed, lasting through the 19th, before downside momentum resumed. The price action on the 20th served as a textbook example of “buy the rumor, sell the news,” with a sharp intraday move that likely caught late long entries off guard. A rebound attempt appeared on the 21st, suggesting some stabilization. The week ultimately closed at $6,602, aligning more closely with the third level of Open Interest support from the prior week, marked at $6,596.

For the week ahead, the current scenario suggests a potential bounce that began on Friday may extend through to Tuesday. During this time, price action could retest the retracement level from the recent high at 6,649, or even push into the clustered zone of extension levels and Open Interest (OI) resistance in the 6,691–6,699 range. From there, possibly as early as Wednesday, the market may resume a downward leg that could extend into the first days of December—potentially bottoming around the 3rd, at which point a stronger uptrend may begin to take shape.

I’ve marked a key level on my chart at $6,759. A daily close above this threshold would effectively invalidate the current bearish outlook and shift the bias. Should that occur, the upside move could be sharp, given the notable gap between current prices and the next major OI resistance levels. Until then, the base case remains cautiously tilted toward another short-term pullback before any sustained upside can develop.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

---

Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

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Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

NOVEMBER

At this stage, there isn’t much to add in terms of high-conviction signals for November. The current upward momentum may extend into the 6th, after which a consolidation or digestion phase could emerge, potentially lasting through the 10th.

From there, another leg higher is anticipated, likely carrying through to around the 18th, coinciding with the conclusion of the earnings-driven momentum. Beyond that, the market may shift into a more prolonged sideways phase, which could persist through the end of the month.

NOVEMBER’s DOI: 6th-10th, 18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader annual performance continue to support the case for a strong year—consistent with what we’ve observed so far. The Kitchin cycle also points to an overall upward trajectory, with the next cyclical peak expected around April 2027.

However, both the Presidential Cycle and the January Barometer are signaling potential weakness as we move into November and December. In contrast, my current forecasts still favor another leg higher into mid-November, followed by a transition into a sideways phase that may carry through to month-end.

Mid-Term View

Historically, November has outperformed October, averaging a +0.9% gain with a 60% frequency of positive closes. While that seasonal trend may still be in effect, internal metrics reflect a more mixed landscape.

The recent decline, beginning in the final days of October, coincided with the 05/08/2025 turning point in the Dow Jones Utility Index (DJU). Although recovery behavior has not been backtested in this context, if the DJU signal proves accurate, a weaker or negative November would be consistent. A potential recovery or stabilization phase could develop during the first week of December, contingent on the DJU’s continued signal validity.

Since last week, the S&P 500 has begun forming lower highs, marking the end of the divergence narrative and shifting the focus toward emerging pattern structures. On the SPX (blue line), the 6750 level stands out as a notable support/resistance zone—well-tested and clearly relevant, it’s a level worth keeping on the radar. What’s more telling, however, is that price seems increasingly unable to distance itself from that zone, as indicated by a declining trendline pressing down from above.

While not textbook, a potential Head & Shoulders pattern is taking shape on the SPX Equal Weight Index (SPXEW). From that structure, one could just as easily outline a diamond top or a symmetrical triangle—using the head, right shoulder, and the two swing lows. Ultimately, the label matters less than the behavior: patterns are just context until a breakout confirms direction.

On the relative strength side, the XLP/SPY ratio has signaled a top, though it remains close enough to turn back up at any moment. Conversely, the XBD/SPY ratio confirmed a bottom and has begun to trend higher.

Monthly model projections anticipate volatility during the 6th–10th window, followed by a recovery into mid-month. Afterward, market behavior may transition into a sideways range, consistent with indications of underlying stability.

Short-Term View

Price action—more clearly illustrated on the OI Heat Map—is currently displaying a tightening range, with a lower high and higher low structure. Last week, price met firm resistance at the black trendline (the original, steeper trend), stalled briefly at the intermediate blue trendline, and ultimately found support—bouncing on Friday—off a third, much slower trendline. For context, this slower line runs at nearly a quarter of the black trendline’s slope. It’s important to note that a deceleration in trend does not inherently signal a reversal; it often reflects consolidation, not capitulation.

Due to a technical issue, Friday’s candle failed to render on the OI Heat Map. However, you can infer its placement from the chart above. More significantly, open interest has surged above current price levels. While these are often referred to as “support” and “resistance” zones, they tend to act more like price magnets—drawing the market toward them rather than pushing it away.

On the volatility front, the VIX briefly poked into the “Caution Rising” zone before pulling back. Still, the broader trend over the past three weeks has been upward—something to keep in mind.

What’s Ahead

We’re still in earnings season, though most of it is behind us. Options expiration lands next Friday, which could introduce some positioning friction. No holidays or end-of-month flows are on the radar, so price action should stay relatively unfiltered. Since it’s the third Wednesday of the month, keep in mind the 20-year bond auction hits around 18:00 UTC—if any decisions are on the table that day, it might make sense to wait until the auction’s out of the way.

EVENTS

• 19th November 2025 19:00UTC FOMC Minutes
• 20th November 2025 13:30UTC Initial Jobless Claims

Outlook & Expectations

Based on current signal alignment and Friday’s candlestick structure, a modest rebound is expected, with potential resistance emerging near the high from October 10, 2025, at 6764. Should price action reject at that level, a subsequent decline may begin around Tuesday or Wednesday, with downside targets extending toward 6558. Intermediate support is identified at 6573. In the event of upward continuation, the next significant resistance is located at approximately 6861.

Monday opened at 6785, slightly above the 6764 resistance level. With no rejection at the October 10, 2025 high, the upside bias held, targeting the expected resistance at 6861—eventually reaching the week’s high at 6869. But by Wednesday, signs of a reversal began to surface. Volume came in higher than Tuesday’s, price stalled near a well-watched resistance, and a small-bodied candle formed just as the VIX touched an upsloping trendline. That, combined with earlier forecasts pointing to a potential turn midweek, suggested that the market was primed for a directional shift.

My long term charts are hinging down, medium term charts are already going down. I do not have a setup for a 20% retrace in the Markets, I would add “unfortunately” but weakness could persist into the new week. If it does possible target is around 6648 with a possible pause or change of direction back up on the 18th (Novemeber DOI). If it does bounce back up on Monday I would be looking maybe for a powerful recovery back to 6896 always keeping in mind the 18th as a date where a possible change of direction or pause may start.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

---

Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

---

Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

---

Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

NOVEMBER

At this stage, there isn’t much to add in terms of high-conviction signals for November. The current upward momentum may extend into the 6th, after which a consolidation or digestion phase could emerge, potentially lasting through the 10th.

From there, another leg higher is anticipated, likely carrying through to around the 18th, coinciding with the conclusion of the earnings-driven momentum. Beyond that, the market may shift into a more prolonged sideways phase, which could persist through the end of the month.

NOVEMBER’s DOI: 6th-10th, 18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader annual performance continue to support the case for a strong year—consistent with what we’ve observed so far. The Kitchin cycle also points to an overall upward trajectory, with the next cyclical peak expected around April 2027.

However, both the Presidential Cycle and the January Barometer are signaling potential weakness as we move into November and December. In contrast, my current forecasts still favor another leg higher into mid-November, followed by a transition into a sideways phase that may carry through to month-end.

Mid-Term View

Historically, November has outperformed October, averaging a +0.9% gain with a 60% frequency of positive closes. While that seasonal trend may still be in effect, internal metrics reflect a more mixed landscape. The recent decline, beginning in the final days of October, coincided with the 05/08/2025 turning point in the Dow Jones Utility Index (DJU). Although recovery behavior has not been backtested in this context, if the DJU signal proves accurate, a weaker or negative November would be consistent. A potential recovery or stabilization phase could develop during the first week of December, contingent on the DJU’s continued signal validity.

The SPX Equal Weight Index (SPXEW) did not produce notable developments; focus shifted to pattern behavior instead. The SP500 index briefly moved below its prior peak before turning higher, while SPXEW appears to be trading within a modestly upward-sloping channel.

In sector-based relative strength indicators, both XBD and XLP have reached structural levels indicative of a potential directional shift—XBD forming a relative bottom and XLP reaching a relative top. Note: the XLP line is presented in inverted format, representing capital inflows.

Monthly model projections anticipate volatility during the 6th–10th window, followed by a recovery into mid-month. Afterward, market behavior may transition into a sideways range, consistent with indications of underlying stability.

Short-Term View

Price action on November 2nd found support at the slower, upward-sloping secondary trendline, producing a reversal candle pattern consistent with a hammer formation. Multiple horizontal levels in that area—derived from open interest (OI) concentration and key percentage retracement zones—continue to provide structural support.

The OI Heat Map reflects a shift in positioning, with relatively lighter open interest at lower strikes compared to the previous week, and increased concentration at higher strikes. Despite short-term volatility, the broader uptrend remains intact, as evidenced by the continued formation of higher highs and higher lows—particularly visible on the simplified OI Heat Map.

The VIX recently touched the lower threshold of its predefined “caution rising” zone before retreating. The broader trend structure remains unchanged.

What’s Ahead

This week’s trading calendar presents a relatively neutral backdrop: no holidays, no month-end flows, no major options expiration events, and no distortion from scheduled rebalancing. With earnings season in full swing, individual equities may see volatility, but broader market structure remains unaffected by macro timing pressures. Notably, it’s the second Wednesday of the month—a key day for U.S. Treasury auctions. The 10-year note typically prices around 18:00UTC.

EVENTS

• 13th November 2025 13:30UTc Inflation Rate
• 13th November 2025 13:30UTc CPI
• 13th November 2025 13:30UTC Initial Jobless Claims
• 14th November 2025 13:30UTc PPI

Outlook & Expectations

Tape read: Friday’s last two hours ramped from negative to ~+0.60% before sellers hit in the final 15 minutes. That argues for a possible bounce on Monday, but I expect the week to finish red. For continuation higher, I want a clean break and hold above 6906–6917; hesitation there signals weakness. If we break lower, first notable support (ignoring slower trendlines) sits near 6727—a sizable weekly move if tagged.

The anticipated bounce at the start of the week materialized with a strong opening; however, intraday selling pressure quickly reversed early gains. The session established a low at 6631, while the projected support level at 6727 held, with the market closing at 6728.

Weekly forecasts are typically based on mid- and short-term signals, although long-term indicators may occasionally be referenced. Based on current signal alignment and Friday’s candlestick structure, a modest rebound is expected, with potential resistance emerging near the high from October 10, 2025, at 6764. Should price action reject at that level, a subsequent decline may begin around Tuesday or Wednesday, with downside targets extending toward 6558. Intermediate support is identified at 6573. In the event of upward continuation, the next significant resistance is located at approximately 6861.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

---

Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

---

Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

---

Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

OCTOBER

To be honest, I don’t have “real” DOIs for October beyond the 2nd. What I see is a rise stretching into the 23rd, where we could hit a digestion phase—basically sideways action as profits get taken till the 29th were another leg up may take place. Those ranges I’ve marked are what I’d call turbulence dates: spots where I expect 1–2 candles to move against the main trend before the uptrend resumes within 3–4 candles. Eventually, this strong run will need to correct downward and shed some profits, but I suspect that won’t show up until the first week of November. So for October, think of those dates as either digestion points or possible reversals—it’s your call which one plays out.

OCTOBER’s DOIs: 2nd, 7th–9th, 15th–17th, 23rd, 29th.

October largely followed the anticipated trajectory, beginning with an initial rise that aligned with the signal identified in the final week of September. We saw a brief consolidation phase between October 7th and 9th, but the market action on the 10th disrupted the expected path and significantly challenged the forecast.

Despite that, the period from the 13th to the 17th marked another stretch of sideways movement, after which the market resumed a strong upward trend into month-end. Aside from a brief pause on the 22nd, the rally was largely uninterrupted.

Importantly, we haven’t seen any confirmed reversals yet—unless the down started on the 28th will continue.

NOVEMBER

At this stage, there isn’t much to add in terms of high-conviction signals for November. The current upward momentum may extend into the 6th, after which a consolidation or digestion phase could emerge, potentially lasting through the 10th.

From there, another leg higher is anticipated, likely carrying through to around the 18th, coinciding with the conclusion of the earnings-driven momentum. Beyond that, the market may shift into a more prolonged sideways phase, which could persist through the end of the month.

NOVEMBER’s DOI: 6th-10th, 18th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The Decennial Pattern and broader annual performance continue to support the case for a strong year—consistent with what we’ve observed so far. The Kitchin cycle also points to an overall upward trajectory, with the next cyclical peak expected around April 2027.

However, both the Presidential Cycle and the January Barometer are signaling potential weakness as we move into November and December. In contrast, my current forecasts still favor another leg higher into mid-November, followed by a transition into a sideways phase that may carry through to month-end.

Mid-Term View

November has historically outperformed October, with an average gain of +0.9% and a 60% positive close rate. That seasonal strength may still play out, but market internals are showing mixed signals. The DJU peak from August 5th, 2025, remains intact—suggesting some underlying fragility. Meanwhile, the growing divergence between the S&P 500 and its equal-weight counterpart (SPXEW) continues to reflect narrowing participation.

Overall market engagement still appears muted. XBD/SPY relative strength remains in decline, indicating reduced activity. At the same time, XLP/SPY RS is rising—signaling a shift toward less defensive positioning, as capital begins moving away from staples and into relatively higher-beta sectors.

Monthly forecasts continue to suggest an upward trend, with some minor turbulence anticipated between the 6th and 10th, after which the up move is expected to resume and potentially extend through the 18th.

Short-Term View

The market remains aligned with the primary trendline, with immediate resistance positioned just overhead. Price action is currently engaging with the faster (red) trendline, suggesting an attempt to build momentum through this zone. However, initial support levels remain relatively distant, situated in the 6727–6652 range, which leaves some room for volatility should prices pull back.

From a structural standpoint, the broader uptrend remains intact. The market continues to post higher highs and higher lows, maintaining the technical definition of an uptrend despite short-term pressures.

Open Interest Heat Map data indicates a noticeable uptick in activity compared to last week, particularly concentrated around lower strike prices. This could reflect either fresh positioning or a layer of protective hedging, signaling that participants are preparing for potential shifts in direction or volatility ahead.

Volatility, as measured by VIX, remains within a stable (green) zone. However, a closer look reveals a subtle upward trend in the VIX lows over recent sessions. This quiet divergence from the market’s broader direction may suggest a cautious undercurrent building beneath the surface, warranting attention if the pattern continues

What’s Ahead

The upcoming week will be shaped primarily by ongoing earnings season, which continues to drive stock-specific and sector-level moves. With no holidays or major options expiration events on the calendar, broader market flow may be more directly influenced by earnings reactions and underlying investor positioning. That said, fund inflows and outflows could still play a secondary role in shaping intraday and cross-asset dynamics. Additionally, it’s worth noting that U.S. Daylight Saving Time ends on November 2nd.

EVENTS

• 04th November 2025 15:00UTC JOLTs Job Openings
• 06th November 2025 13:30UTC Initial Jobless Claims
• 07th November 2025 13:30UTC Unemployment Rate

Outlook & Expectations

There were no explicit forecasts for last week—just a reminder to watch the 27th and 29th for possible signals—and nothing dramatic materialized. We opened with a gap-up on Monday the 27th, and the all-time high printed on the 29th. SPXEW peaked on the 27th, so what you see depends on whether you track the cap-weighted S&P 500 or the equal-weight version.

Positive headlines and upside earnings are masking narrowing breadth that could reverse abruptly. A quick week-over-week check makes the point: SPXEW −1.5% vs S&P 500 +3.0% (as of writing while markets were still open). On its own, that’s not a sell signal; it needs confirmation.

Long-term: most frameworks don’t support a major decline (a couple of models do).
Medium-term: bias leans down over the next week(s).
Short-term: the uptrend remains intact after the 10/24 gap; the 10/27 gap is filled, while the 10/24 gap remains open. Resistance is just overhead, and the OI heat map suggests building downside pressure. Mega-cap earnings can still whipsaw the main indices (S&P 500, Nasdaq, Dow), which is why I don’t rely on them alone.

Tape read: Friday’s last two hours ramped from negative to ~+0.60% before sellers hit in the final 15 minutes. That argues for a possible bounce on Monday, but I expect the week to finish red. For continuation higher, I want a clean break and hold above 6906–6917; hesitation there signals weakness. If we break lower, first notable support (ignoring slower trendlines) sits near 6727—a sizable weekly move if tagged.

Long-Term

Decennial Pattern & Performance

The table averages market performance for each calendar year ending in the same digit and shows how often those years closed up or down. We’re now in a year ending in 5, which has historically been the best-performing of the lot. Out of nine such years, the market closed higher eight times.

Please note that the up/down counts in the table reflect only the direction of the yearly close and do not distinguish between small or large gains or losses. A year marked as “up” may include increases as minimal as 0.1%.

	0	1	2	3	4	5	6	7	8	9
Avg %	1.34%	1.38%	0.64%	16.27%	7.97%	22.05%	9.41%	1.49%	10.07%	10.37%
Up/Down	5/5	5/5	6/4	8/2	7/3	8/1	7/2	6/3	7/3	7/3

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Kitchin Cycle

The Kitchin Cycle is a short-term business cycle lasting approximately 40.68 months, or about 3.4 years. First identified by economist Joseph Kitchin in the 1920s, it reflects recurring fluctuations in production and inventories. These cycles are driven by delays in information flow and business decision-making — companies respond to market signals with a lag, often overcorrecting by overproducing or underproducing. The result is a rhythmic, short-term economic pulse, distinct from longer cycles like Juglar or Kondratiev waves. Source: Technical Analysis Explained – Martin J. Pring.

Last Forecast Date	Type	Actual Date	Actual Direction	Next Peak	Next Valley
09/04/2025	Valley	07/04/2025	Up untill next peak	23/04/2027	08/12/2028

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Presidential Cycle

Post-Election Year (Year 1):
The first year after an election often begins on a shaky footing. Investors face uncertainty as the new or continuing administration rolls out its agenda, which can spark heightened volatility. Markets tend to struggle in the early months, moving in a sluggish, uneven fashion before finding a firmer footing into late spring and summer. That rally phase is usually short-lived, as the market frequently rolls over into a sharp correction in the autumn months. By the end of the year, however, stocks often stabilize and manage to recover a portion of the earlier decline, leaving the overall year mixed or modestly positive.

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Midterm Year (Year 2):
The second year is historically the most difficult. The weakness from late in Year 1 can spill over, and the first half of the year is often dominated by hesitancy, uneven growth, or outright declines. Political uncertainty around midterm elections tends to weigh on sentiment, while policy adjustments or tighter monetary conditions can add to the pressure. The turning point usually comes in the latter part of the year. By autumn, markets often carve out an important low, setting the stage for a strong rebound in the final quarter, as election results bring clarity and forward-looking investors position for the next phase of the cycle.

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Pre-Election Year (Year 3):
The third year of the cycle is typically the strongest. The environment is generally characterized by policy support, as administrations often encourage growth and stability ahead of the coming election. Markets tend to respond with steady, broad-based advances that can last through much of the year. Pullbacks do occur, but they are usually shallow and quickly reversed, as the dominant tone is constructive. Investor confidence tends to be high, liquidity conditions are often favorable, and risk appetite expands. This combination makes Year 3 the most consistent bull phase of the four-year pattern.

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Election Year (Year 4):
The final year of the cycle carries a more complex personality. The bullish momentum from Year 3 often extends into the opening months, but as campaigning heats up and polls shift, the market can grow unsettled. Volatility becomes more pronounced, with swings tied to election headlines, policy promises, or unexpected political developments. Despite this choppiness, the underlying trend tends to remain positive. Once the outcome of the election becomes clearer, markets usually regain their footing and push higher into year-end. Though less robust than Year 3, Election Years still often deliver respectable gains.

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Mid-Term

	JAN	FEB	MAR	APR	MAY	JUN	JUL	AUG	SEP	OCT	NOV	DEC
Avg.	1.2%	-0.2%	+0.4%	+1.1%	0.0%	+0.9%	+1.4%	+0.5%	-1.1%	+0.5%	+0.9%	+1.2%
% Up	61%	53%	60%	62%	61%	58%	61%	58%	46%	58%	60%	73%

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Sector Signals and Relative Strength

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Monthly Forecasts

OCTOBER

To be honest, I don’t have “real” DOIs for October beyond the 2nd. What I see is a rise stretching into the 23rd, where we could hit a digestion phase—basically sideways action as profits get taken till the 29th were another leg up may take place. Those ranges I’ve marked are what I’d call turbulence dates: spots where I expect 1–2 candles to move against the main trend before the uptrend resumes within 3–4 candles. Eventually, this strong run will need to correct downward and shed some profits, but I suspect that won’t show up until the first week of November. So for October, think of those dates as either digestion points or possible reversals—it’s your call which one plays out.

OCTOBER’s DOIs: 2nd, 7th–9th, 15th–17th, 23rd, 29th.

DOIs: “DOI” refers to “Date of Interest” — a term used to highlight specific days when potential market reversals or periods of heightened volatility may occur. The methodology behind the identification of these dates has not been disclosed in previous publications and will remain confidential in future ones.

Short-Term

S&P500

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Summary

Long-Term View
The broader outlook remains positive, though two key seasonal indicators — the Presidential Cycle and the January Barometer — are flashing potential for a sharper correction heading into autumn. While not predictive in isolation, both suggest Q4 may come with increased volatility and a possible inflection point.

Mid-Term View

Seasonal patterns currently suggest a period of reduced market weakness, marking the beginning of what has historically been the strongest five-month stretch for equities. However, when considering the Dow Jones Utility Average (DJU) as a longer-term leading indicator—typically with a lag of approximately three months—it points to the potential for near-term weakness that may soon materialize.

While the S&P 500 recorded a new all-time high today, the equal-weighted S&P 500 index (SPXEW) did not manage to close above its October 3rd high, indicating a possible divergence in breadth. From a technical perspective, the SPXEW has formed a sequence that warrants attention: a low on September 25th, a high on October 3rd, a lower low on October 10th, and—if today marks a pivot point—a potential lower high on October 24th. This sequence aligns with the early stages of a possible downtrend.

In sector performance, the relative strength of the Broker-Dealer Index (XBD) continues to decline at a consistent rate, while the Consumer Staples sector (XLP) appears to have recovered from its recent dip. A similar pattern was observed in the May–July 2024 period, where relative weakness eventually transitioned into a broader move. For any meaningful downside confirmation, it would be important to see XBD form a clear bottom and both XBD and XLP relative strength lines begin to converge.

Finally, monthly cycle forecasts have highlighted October 29th as a potential Date of Interest (DOI). Price action and technical signals around that date may offer valuable insight into the market’s next directional bias.

Short-Term View

The market has managed to reclaim levels above the primary trendline. While not clearly visible in the current chart setup, price is now testing a slightly steeper secondary trendline—often referred to as the “faster” red trendline. In the same area, there are a few notable open interest (OI) concentration zones, marked by green lines, though little else in terms of structural resistance. Below current levels, the main trendline remains intact and has demonstrated reliability over the past several months. Additionally, there is a key level at 6707—identified in prior analyses as a significant support marker—along with several OI reference lines and fixed-percentage retracement levels drawn from major highs and lows, represented by dashed lines.

The OI map provides a clearer view of positioning dynamics, showing a concentration of resistance just above current levels, while support remains well-established below. Of particular note is the visible compression in significant OI levels, suggesting a narrowing range that may lead to a more decisive move once resolved.

The VIX has cooled, reflecting lower implied volatility and, by extension, more affordable portfolio hedging. For investors employing a strategy of maintaining a fixed-percentage hedge, any interaction with key levels or trendlines may serve as a suitable entry point for initiating small hedges. This approach can be useful in balancing portfolio risk, potentially enhancing returns during upward movements while providing some downside protection during periods of market stress. Executing such strategies effectively requires an understanding of one’s portfolio beta and the delta exposure corresponding to the portion of capital being hedged.

Regarding the VIX chart itself, both primary trendlines remain in place. The most recent candle closed near the intersection of these two lines, suggesting a potential inflection point. Previous support levels in this region may now act as resistance, and vice versa, depending on how volatility evolves in the coming sessions.

What’s Ahead
Next week’s trading calendar will be relatively straightforward, with no scheduled options expirations or market holidays. However, as it coincides with the end of the month, investors should be aware of potential flows related to portfolio rebalancing—both inflows and outflows—that can impact market dynamics. Additionally, some countries will transition out of daylight saving time during the week. It is important to ensure alignment with U.S. market hours, as the United States will make its own daylight saving adjustment the following week.

EVENTS

• 29th October 2025 18:00UTC Fed Interest Rate Decision
• 29th October 2025 18:30UTC Fed Press Conference
• 30th October 2025 12:30UTC GDP
• 30th October 2025 12:30UTC Initial Jobless Claims

Outlook & Expectations

Looking to next week, I’ve flagged the 23rd as a potential day of interest (DOI). That doesn’t necessarily imply downside. In fact, we could see a bounce begin as early as tomorrow, with some downward pressure tied to options expiry. I’d expect choppiness to continue until around the 22nd, where we may see bullish momentum build. For the next potential leg down, I’m watching around the 27th.

We saw a bounce on Friday the 17th, following the red candle from the previous session. The initial expectation was for a period of choppiness, with bullish momentum resuming closer to the 22nd, in line with the Date of Interest (DOI) on the 23rd. However, what actually developed was a steady rise beginning on the 17th, with only a brief pause on the 22nd.

Looking across multiple timeframes, the picture is somewhat mixed. Long-term charts continue to show a solid bullish structure, while mid- and short-term charts present a more uncertain outlook. This divergence may suggest upcoming volatility in the near term, though not necessarily a decline. It could just as easily indicate continued consolidation or sideways movement. October, as historical patterns show, tends to be an unpredictable month, with potential buying opportunities often concentrated near the end. That’s exactly where we are now. Seasonality also points to two common accumulation windows during the year: May–June and late October. While these are not guarantees, they are worth monitoring.

Next week brings a number of scheduled events that could influence market direction. I typically form a base-case scenario and then monitor how data aligns with or challenges that view. It’s important to remember that certain events—especially those that introduce new, unexpected information—can shift sentiment and trigger short-term market adjustments, typically lasting one to three sessions unless the news is particularly significant.

Given the current backdrop of mixed technical signals, seasonal influences, and a dense calendar of upcoming events, establishing a high-conviction forecast for the week ahead is not straightforward. While certain indicators point to underlying weakness, others suggest the potential for renewed strength, particularly as we enter what has historically been one of the most favorable seasonal periods for equities. This creates a somewhat balanced scenario in which upside and downside pressures may effectively offset each other—leaving the possibility of continued consolidation or sideways movement well within reason.

Key dates to monitor include the revised Date of Interest (DOI) on October 27th and the originally projected DOI on October 29th. Price action and volume behavior around these timeframes may offer valuable clues regarding the market’s near-term direction. Until clearer signals emerge, a neutral stance remains justified, with a focus on risk management and readiness to respond should a more directional move begin to take shape.