FOR MONDAY: (7/17) Summer Mondays can just have tight ranges. Cycles are unusually volatile into Tuesday. We’re concerned about the earthquakes at Yellowstone turning into a large volcanic eruption and there’s one cycle that could cause something in the next few days. It would be a monumental event bigger than Mt. St. Helens. It’s definitely brewing for the summer sometime. Still, without a trigger, stocks should continue higher even if we get a 1-day pullback. Dollar broke key numbers and should break to 9444 now.
SEPT. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S&P ANALYSIS FOR MONDAY: (7/17) The breakout above 2450 now projects 2466-69 and NQ hit upper target of 5840 which means 5870 is next. New highs on NQ by early August would reach 5987. Very possible that higher numbers will be in by early Monday and then the market may congest lower the rest of the day. Again, there’s still time to even reach 2520 on the S & P and you never sell a market in new high territory. The game continues. Bears will have to wait until about the 2nd week of August for the market to come off and then we think a 10-15% correction into October.
WEEKLY CHART: We ran cycles through August and they are mixed. We are not thinking that the market will fall apart dramatically in July, but we doubt that there’s enough time and room for 2520 to come in this summer before things get complicated August-October. The market does seem like it will hold up into July 25. Seeing lots of congestive action and it may not fall apart until after August 5 or 9.
CYCLES OVERVIEW: Higher Sunday/early Monday; lower into late Monday; lower early Tuesday; higher Wednesday/Thursday.
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