Sit & Wait

Sit & Wait … The S&P 500 rallied to new all-times highs out of the June daily and weekly cycle lows as the Federal Reserve saved as interest rate cuts are likely on the horizon.  Meanwhile, the underlying economic data continues to deteriorate. The Global Composite PMI printed 51.2, sitting at a 3-year low. In such market environments we must sit and wait and let the market tip its hat – more policy driven asset inflation or deflation and repricing of risk assets lower. TRI stated in early June that the market might be setting up 2 more traps. First for the bears and the second one for the bulls. So far, the bears have been beaten up pretty good as the market rallied out of the June weekly cycle low. Now we wait for the setup to complete the bull trap …  before market rolls over. As of July 8, the S&P 500 is on bullish trend signal for the daily, weekly and monthly cycles. Higher prices can be expected as a break of 2,950 is needed to signal a potential top. Until then SPX can rally to next Fibonacci cluster at 3,045. The daily cycle is expected to…

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