Back in mid April on Kitco.com I wrote a market forecast calling for a top in the SP 500 index and an ABC correction. Since that time I had one intervening update on both Gold and the SP 500 index, and this is a June 5th follow-up.
Gold should continue to back and fill as I postulated around the 1200-1235 area’s, until the next surge taking it up to 1300-1325 US per ounce. The burning matches we call currencies are getting hotter, and fingertips are getting burned in Europe a little at a time. The Elliott Wave patterns I use as my underlying basis for forecasting are continuing to look bullish for the precious metal. In addition, it’s a darn good alternative to fiat paper during this period of the Kondratiev winter where debt is repudiated and washed out of the system.
The SP 500 index or the US broader markets if you will, continue to unfold in my predicted A B C correction. I forecasted in pre market on May 25th that a “3-3-5” ABC low pattern was completing that morning from the April highs, with an intervening bounce likely. The problem is this “Bounce” as it were, has only recovered a 38% re-tracement of the April highs to May lows. The upward correction was mild in percentage terms, and the gap down in the SP 500 index and markets on Friday morning portends lower lows to come. A weak bounce and a solid thud is not near term bullish. My ultimate forecast called for 92-97 on the SPDR S&P 500 ETF (NYSE:SPY) by mid September 2010, and I am continuing to stick with that as the likely outcome before the Bull can resume the advance in earnest. This would be a 50% re-tracement of the 13 Fibonacci month rally from March 2009 to April 2010. I look for the summer to be choppy and volatile with a likely downside bias. As I thought in April, it’s a sell in May and go away year until the summer ends. Trading profits could be made on the 2x/3x bear and bull ETF’s, and we plan to work with those this summer in my paid website services.
If you would like to view an up to the minute forecast video on the SPDR S&P 500 ETF (NYSE:SPY), watch the 4 minute video below:
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Here are some other details on the SPDR S&P 500 ETF (NYSE:SPY) below:
SPDR S&P 500 ETF (NYSE:SPY)
The SPDR® S&P 500® ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500 Index (Ticker: SPTR). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.