FOR THURSDAY: (8/16) Expecting stocks to recover the next few days while metals should find a temporary floor and do a dead-cat bounce. While stocks have issued a stronger sell-signal, we can probably only count on another 61 S & P points lower from wherever the market stalls into Sunday or Monday. There’s a sense that with Turkey, the other shoe could drop and set off a major crisis but not clear on the timing and need to research much of September, which tends to be bearish for stocks anyway.

SEPT. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR THURSDAY (8/16) S & P bounced off of our 2nd lowest target of 2803 and rallied enough that new lows to 2791 are unlikely. First resistance overnight at 2825.50 and 2829.50 with key support at 2822.50. Staying above 2820 overnight will be very friendly for the morning and a good chance for a retracement of the recent fall. Markets don’t go straight down so a recovery back to 2840-2 on Thursday wouldn’t be shocking. With daily stochastics having turned lower, we have to stay on guard for the 2nd part of the Sept. swoon. We’re to expect a recovery into Monday and then another push lower into Aug. 25.
CYCLE SYNTHESIS: Higher into Thursday and Sunday.

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