Choppy, Toppy Market into Early October
Last week, we saw the stock market whipsaw: up one day and down the next. That pattern should continue into October 4th with another down day Monday. Buy the dip! A cycle top is due on Oct 4. The whole pattern smacks of a sideways 'b' wave bear flag that should give way to a nice 'c' wave drop into week's end.
I believe we finally see that false break of the rising wedge I've been talking about. A test of SPX 2099/2100 looks likely by Oct 7. October 6th should be a huge down day, somewhat similar to September 9th. What a messy strewn out 'Z' wave we've had (see chart below).
The expected October 7th bottom should yield the final "C" wave thrust back up into the rising wedge, perhaps as high as 1995-2110 or somewhere in between. 2220 would surprise me. October's expected top on October 14th should be the high for the year. A post election surprise should drop the markets markedly into around November 18-21.
Gold made a new low 2 trading days past the GDX low last week. Silver tried to rally, but stalled. The recent pattern suggests a strong rally early next week, but like the stock market perhaps doomed to fail to make a higher high than the last high.
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Another thing I wish to mention: please don't trade this or any other forecast verbatim without getting proper updates from the author. Tracking the stock market is much like tracking the weather: you need to have regular updates. Things can and do change.
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