Markets turned down as expected.
So far it has been a fairly mild downturn, but that doesn’t mean it is over already.
Let’s have a look at the S&P 500 (click for larger image):
The long term uptrend is intact, but none of my indcators is showing any signs of a bottom at this point.
We have another week of lunar red period to go, so I also remain cautious from that point of view. For now I will stick to the 1700-1760 downside target we set out two weeks ago.
The LT wave chart we shared in that post, points to a year end rally. The main question is: from what level will it start?
Whether this is just a short pullback or the start of something bigger is hard to tell at the moment. But it wouldn’t surprise me to see this period of weakness stretch into February.
More on that in the new year forecasts that I will present shortly.