This week our SPX targets of 3,400 and 3,500 were hit. We expect consolidation between Friday and next Tuesday. As long as SPX 3,420 holds on a closing basis, no meaningful pullback should occur. The next target is 3,600. While anything is possible, we favor a pullback and re-test of the highs into September 7th/8th. We will all know by next Tuesday based on the size of the correction. The market has been successfully managed into Powell's Fed speech today at Jackson Hole, as well as into the RNC convention this week culminating in the Presidential speech tonight. If Trump lays out more tax cuts tonight in his speech, all bets are off and we may rocket straight into Sept 8th, SPX 3,700. Our system projects targets in time first and price levels second. Key points in time are September 1st for a low, and the 7th/8th and 23rd for peaks. As we mentioned, long side risk will increase slightly after September 7th. Short term trading strategies are most likely only best now in stocks that you would not mind holding long term. We would stay away from story stocks and lotto stocks this late in the cycle. Major indexes and big name stocks should remain supported into the election with no crash event. The highest potential for a 7-10 day profit-taking event will be in October, but that is expected to be bought right back up into November 3rd.
A note on our forecasting of the general stock market: We have had some minor deviation in our forecast price level targets due to the degree of liquidity being pumped into the markets and artificial support being put in place by the Fed banks. Simply put, these markets are more dynamic than ever. We apologize, but adjusting on the fly is necessary. Most people have been shorting the stock market all summer calling for corrections since last June and another crash. Our forecast has allowed many members to retain long positions with comfort and harvest considerable profits this week. We have received many complimentary emails the past week on our SPX forecast. We will continue to do our best to protect our members' capital.
We expect a top in metals next week, then a decline into September 12th +/- 2 days. Most likely, the tops next week will be lower highs than the early August peaks in gold, silver, and the miners. We need to see more evidence to change our forecast of a mid-October low and a major peak already in place (August 6th) for the metals complex.
Hurricane Laura hit today and oil experienced some profit taking, as damage was not as catastrophic as anticipated. Targets project higher into the third week of September.
Restaurants still have a shot at hitting their 200 DMA’s into Labor Day weekend, September 7th. BLMN came close today for a close over $13 but was rejected late in the session. If they fail to tag the 200 DMA over the next 7 trading sessions, we would look at September 23rd for another peak.
Steel can go parabolic tomorrow if Trump says the right things tonight. Listen for the words infrastructure and American steel.
SPCE will most likely put in a sideways coil for the next 4-5 days. Any news can trigger a multi-day advance at anytime, as SPCE is a favorite of day traders and has a cult following.
Bitcoin is consolidating as expected this week as it gets ready to launch into September and ultimately November.
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