FOR MONDAY: (8/13) On Thursday, we had put Turkey on the list of key places that could be impacted by geopolitical tensions and we’re not through the weekend yet and still have highly sensitive areas outlined for China, UK, Argentina, Turkey, India and Israel. The cycle over the weekend can trigger major political and economic events of significance, and it should impact oil strongly–and usually the powers that be create enough saber-rattling to make sure that oil stays up. As always, hard to take a position home over the weekend.
SEPT. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR MONDAY (8/13) Since Wednesday we have suggested a minor top was due, but we’ve only been day trade selling in the low 2860s. Our swing trade line was hesitant waiting and missed the boat. Our cycle work is higher for next week and the stock indicies held key levels on a closing basis. We have seen so many sucker punches that it’s hard for us to get beared up. Still, the reality of the Turkish crisis, which is worse than Greece, is that it will impact European markets and their money will flee into the US, which already happened with the dollar and T-notes rising. It’s a potential watershed event but how much it will impact the US is up in the air. So, we can’t count on world contagion bleeding into the US but if you are in European funds, you have to head for the exits. Cycles are pointing higher next week so we have to see how Sunday night comes in to take stand. At the worst, cash might fall to 2807.
CYCLE SYNTHESIS: Higher into Monday; probably higher into Aug. 13; lower into Aug. 16-17.