Nightly Briefing 8/27/20


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.

HFZ


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Important Disclosures: Investing in the financial markets can involve considerable risk, including loss of principal. Past performance is not necessarily an indication of future performance.  Actual clients may achieve results materially different from the results portrayed.  All material is for informational and educational purposes only and is not investment advice and is not meant to suggest that any securities are suitable investments for any particular investor.  All information reflects our own actions, beliefs, and processes for purely informational purposes. HEDGE FUND Z LLC IS A FINANCIAL BLOG FOR THE SOLE PURPOSE OF EDUCATION.  HFZ does not represent themselves as acting in the position of an investment advisor or investment manager for funds that are not under their direct control and fiduciary responsibility. 

 

Third party quotes and information may not be representative of the experience of HFZ customers and do not represent a guarantee of future performance or success. Many of the results displayed on our website were achieved using leverage, such as 2x or 3x leveraged ETF's or equity options 

 

The information included at HFZ and HFZ writing, research, and updates is prepared for educational purposes and is not a solicitation, or an offer to buy or sell any security or use any particular system.  Information is based on historical research using data believed to be reliable, but there is no guarantee as to its accuracy. HFZ does not represent themselves as acting in the position of an investment adviser or investment manager for funds that are not under their direct control and fiduciary responsibility. HFZ will not provide you with personally tailored advice concerning the nature, potential, value or suitability of any particular security, portfolio or securities, transaction, investment strategy or other matter.  

 

No information, nor any opinion expressed on the Site or in the Services, shall constitute a solicitation or an offer to buy or sell any securities mentioned therein.  The information presented on the Site and in the Services has been prepared without regard to any particular investor's investment objectives, financial situation, needs, capacity, and trading ability or experience. Accordingly, you should not act on any information on the Site or in the Services without obtaining specific advice from your financial advisors and should not rely on information herein as the basis for your trading and/or investment decisions.  HFZ cannot claim or represent that any of our Services are suitable for you. 

 

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