Originally posted July 4, 2016 at 7:06 PM.
Stock Market Could Go Either Way
The precious metals complex looks toppy here and a pull back is warranted into the end of July (see chart below for added information).
The stock market is in a critical zone. The 4 TD low is overdue by 1 TD and the 8 TD low is due on July 8th. The 16 TD low is due on July 11. The bullish scenario sees a move back to near 2082 SPX on July 5th a rally to 2126 on July 6th and then a pull back to 2070 by July 8th. BUT, IF July 8th holds near the July 5th lows and cracks through it on July 11 to near 1980 SPX, all bets are off for the upside. Either way, we should see an important top on July 6th.
Right now, the chart read looks like a bullish one to me with a target of 2288/89 by September 2. I would be willing to change my mind IF Mr. Market does not do as I expect and the alternate scenario comes in to play (chart below).
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