Stock Market Dip Monday, Tuesday? Gold Topping
Last I wrote, I thought we might be breaking down out of a rising wedge pattern in the SPX. Apparently, many others thought the same thing, and you know what they say when too many agree. So many are thinking we go lower from here and that has me concerned. While I think we go lower over the next two days in the stock market (1957-62 SPX down about 3%) and I think that we are in the early stages of a bear market, the probabilities are we have one to two more weeks of general upside left before we top. My current upside targets are 2058-81 SPX.
I also thought gold and GDX had already topped, but my current readings suggest a very good possibility we see a new recovery high in GDX by FED day March 16 (I know the COT reveals the smart money is shorting gold and it may seem contrary, but I'm going out on a limb and suggesting more new recovery highs this week). We may also see new recovery highs in gold by Wednesday. I believe the FED language on the 16th will send the gold mining sector (and gold) down hard into the end of the month and even beyond.
For the rest of the year: by June 2016, I think we see SPX 1300 +/- and by October/November SPX 1010-11 is on my radar; I don't think this bear will be as bad as 2007-09, but I don't think it will be pleasant either; I also think gold could go down to as low as $667-778 by October; GDX could see prices below $8 when all is said and done.
The above charts are projections and possible targets. As information flows, I adjust accordingly.
Brad Gudgeon, editor and author of the BluStar Market Timer,
is a market veteran of over 30 years. The subscription website is www.blustarmarkettimer.info
BluStar Market Timer offers auto-trading for those who don't have the time or inclination to trade their own accounts.