FOR THURSDAY: (8/17) Stock market tiring and not getting good news with the dissolution of the Business Council. Still, cycles will turn better in the morning if the market doesn’t fold overnight. Gold cycles are stronger into next week so thinking we missed the buy and will get in. That would mean the dollar won’t let us go short at 9442.
SEPT. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR THURSDAY: (8/17) The disbanding of the Business Council is not what the world wanted to see out of Trump. We wonder if it will negate a secondary high on Thursday? A move to 2480 may develop over the next few days with worst downside at 2457-8 overnight and 2462 doesn’t have to come out. Cycles not as good for Thursday as we originally thought but still might hold up. If the market can’t take out 2480 by Friday, there’s a stronger chance next week to go to 2420 before moving higher to 2520 into September. Not thinking that a deeper break to 2450 will happen at this point.
OVERALL: Overbought conditions from last night may not allow too much upside. Key resistance on the SP futures is at 2474.50 and we had only 2479.50 as an upper target last night, which doesn’t have to come in. The chances of new highs to 2520 into September are still strong. At worse, congestion and inability to take out 2480 could lead to 2420 if we get some excitement next week which is very possible. NQ is always a key. Futures patterns suggest 6009 for a new high but may be not on Wednesday.
OVERALL: We had noted in our monthly newsletter that a 60 point fall could be a 4th wave (and that is all we got on SP at 59 points) and that new highs to 2520 were possible if the news would shift and that is not out of the question for a Sept. high if the S &P can continue to ignore headlines. The alternative pattern to fall to 2420-2400 is just less likely with option expiration and we’re now assuming that cycles are inverting and going higher into next Sunday.
Still, Aug. 9th was Bradley Major turn date that we had seen for weeks and the high on the S & P came in at 2488.75. We’re so used to sucker punches from the Plunge Protection team that we never quite trust the bears lead on this one. Korea hangs in the balance but Russia and China are trying to prevent a military confrontation and the Secretary of State continues to pursue diplomatic ties.
WEEKLY CHART: There’s still a good possibility that based on patterns that the current fall is a 4th wave and that a new high to 2500-2520 would be possible in September. In the end we still see only 2300-2320 as a fall correction target with a multi-year high due into 2018.
CYCLES OVERVIEW: Higher Thursday.
