Since late last week, the SP500 has been in a bearish funk waiting for some fundamental news that will send stocks soaring again. The SP500 is sitting on the 200-MA line so when that support is not strong enough, them more downside is sure to come.
At 2969 this market has a major roadblock to contend with in the shape of a triple top and a couple of H&S dips.
The SP500 needs to keep going south before another death cross kicks in. I’m guilty of leaving the 5th wave uncapped due to lack of room.
Leaving any 5th wave uncapped must not happen as it tells all readers that the wave count is terminated, worse yet it shows we have no confidence in our wave counts.
In the long run, the entire June bull run will get retraced once the SP500 falls below 2740. We also have to be aware that another correction will complete before then.
The Gold/SP500 ratio is at 2.08 from a high of 2.41, so I still consider that very expensive.
One thing to watch for is how gold is going to react while stocks are heading down. Running into a safe-haven like gold is an emotional decision, and can work against us. As soon as any counter rally or bigger bullish run comes along, those gold investors will start to run like chickens as the stock market is very strong competition for gold.
Solar cycles are the real fundamentals as they produce the bullish business cycles like what happened in early 2009.
Younger investors should track the solar cycles as they also drive all commodity prices. The 2020 elections will happen at the bottom of solar cycle 24 so I’m sure there is lots of room for any turmoil to strike fear into the hearts of investors.