sp'monthly
Trans'monthly
Summary
So...we're 75% of the way through 2013 (what a thought!), and the market is currently around 20% higher for the year.
I continue to read around so many great chartists/blogs, a fair few of which are looking for much lower equity levels this Oct/November, but really, I just can't see it occurring.
QE continues, and once this US Govt' shutdown (and the subsequent debt ceiling) issues are out of the way, there is very little reason why the market won't be able to resume..if not even accelerate the upward trend into spring 2014. If that sounds hyper-bullish...its because it is.
Bears still waiting
Despite the post FOMC price action being moderately weak, the monthly charts most certainly closed the month pretty bullish. The monthly rainbow chart closed with a blue candle on the sp'500, and that's the third one out of the past four months.
sp'monthly3b
The monthly blue candle closing is kinda interesting, but still, doomer bears need RED...blue is just not good enough! Further, it remains important to recognise the support that the monthly 10MA offers, which at the Oct'1 open..will likely jump to around 1610.
Looking ahead
There is ISM manu' and construction data tomorrow, although clearly, Mr Market will be more focused on what is happening on Capitol Hill.
*there is sig' QE-pomo this Tuesday of around $3bn
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The bears have been smashed around by the bulls for the past two years..and we're around 60% higher since then. Yes, there are serious macro-econ problems out there, but for now..things look 'contained'. I wish I could believe otherwise.
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Video - from Bloomberg
Every cycle is unique of course, but if you add 12% onto the current sp'1680, that gives 1880. My year end target if 'everything holds together, with continuing QE' is the 1850/1950 zone. I'm certainly not touting sp'2000s until the spring, but for the bulls out there, the sp'1800s would be more than sufficient, and be a net yearly gain of around 30%.
Gold/Oil update - from Walker
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Goodnight from London