Folks,
Market Observations for the Week: The FOMC cut its Fed Fund rate by 50 bps and we had big volatility into the close with the SPX closing down. However, the first reaction after the announcement was for the SPX to make a new ATH at 5689.73 before pulling back. Our bias is that the SPX finished an EW 5-waves up from 8/5 and made a new ATH and is now correcting in an EW a-b-c pullback. The SPX did make an ATH in the 9/16-9/18 Full Moon Timing Window which includes a Full Moon, a lunar eclipse at perigee and the Fed rate cut decision and could now correct into the quad witching expiration from Friday into Monday. The Tuesday after a monthly expiration, 9/24, should see a reversal back up in the SPX that should test 5689. The new ATH in the SPX and DJIA post-Fed rate cut today argues that the 2007 year analog stock market model is in play and that higher highs are possible into October after a short-term correction. Our current positions are 55% cash and 20% physical gold, silver, platinum, and palladium - we favor palladium at the current time for acquisition. We are currently trading gold, silver and mining stocks with 25% of our cash.
9/18/24 (Commentary for Wednesday) The SPX spiked to a new ATH after the 50 bps rate cut from the Fed and we may have finished a 5-wave up rally from 8/5. The SPX could now see a correction through the quad witching monthly option expiration. It's a good time to raise your trading stops and protect your profits after the extended rally from 9/11. The SPX rallied up in an EW 5-waves from its 8/5 low and made a new ATH at 5689 in today's 9/16-9/18 turn window but the NDX is still lagging. The SPX reversed up impulsively from its 34-day step out on 9/6-9/9 and may finish its 5th wave higher early Thursday. The year 2007 SPX analog model appears to be working here and allows for a possible new SPX ATH into October. Our bias allowed for the possibility of some indices making a new ATH into October as we saw with the new ATH today in several indices after the Fed rate cut on Wednesday. The QQQ decline from 8/22 to 9/6 may have been just 3-wave, so it is possible to see a test of the July highs. However, money appears to be flowing from the Big Tech stocks into the small caps and the NDX may have made a top for this bull market cycle. The Presidential election year and the year SPX 2007 analog model still argues for the possibility of a new ATH in several induces going into October. We need to allow for the possibility of new ATHs in the SPX and IWM going into October. Gold spiked to a new ATH at $2627 on Wednesday and may be close to a 5-wave pattern completion from 9/11.
Big Picture on Stocks (UPDATED) After reversing up after its 34-day Fibonacci step out from 8/5 on 9/6-9/9, the SPX joined the DJIA, SPXEW and NYSE in making new ATHs for the year. The 2007 analog stock market model looks good for higher SPX and IWM highs into October.
Big Picture on PMs (UPDATED) Gold spiked to $2627 post-Fed - we may be close to completing a 5-wave rally from 9/11. A correction into 9/24 is possible.
Stocks – The E-mini is making a 5-wave pattern completion from 9/11 into pre-market Thursday - a correction into 9/24 is possible.
Gold – Gold made a new ATH at $2627 post-Fed - looking now for a correction into 9/24.
Silver – Silver made a higher high at $31.68 pre-market Thursday - we could now correct into 9/24.
Bonds – Bonds pulled back to test its S2-pivot support at 124'18 early Thursday.
Crude Oil – Crude oil is holding at $70.64 early Thursday.
Dollar Index – The USD tested 100.51 early Thursday and is rebounding.
TURNING POINT DAY
The turn window for this week is 9/16-9/18.
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