Jul 15, 2016
Long term - update
It is time for the next long term update and after that I am taking a break for a few weeks. The next update will be in August probably 07.08. Until than you will have to navigate the markets alone:) P.S. The indexes reached the targets which I have posted. I am not comfortable on the long side anymore so I am out.... out on vacation:) Since the last long term update I would say the markets moved in the expected direction no surprises - stocks higher, bonds higher, emerging markets outperforming, commodities with important low. Last time I wrote - "trend changes are expected in 2016 based on my analysis of cycles and EW patterns."Stocks made an important low and reversed, but the big questions are - Is the bond bull market over? Is the commodities bear market over? What to expect in the future.... - Bonds major top of the bond bull market - 2012 for the 10-year treasury note and now for the 30-year treasury note, bold call but this is what the charts are saying they look very ugly for the bulls. - Stocks - after the current mess is over continuation higher with the strongest wave 3 of the impulse probably fueled by money exiting the bond market. - USD should finish the consolidation phase (probably a triangle) in the next 6 months with 3 year cycle low and start the final wave higher The difficult part - is the bear market for commodities over after such impressive run? - Gold miners look like an impulse, for gold/silver there is a lot of room for interpretation of the waves. For the next 6 months( before the next update) the rally should pause and correct. When we see the first move lower after this rally we will know more. - Crude oil/Natgas - only three waves corrective move so far. If we do not see another leg higher for an impulse the energy sector is in some kind of corrective structure. - STOCKS I had two scenarios - 7 year cycle low in Q1.2016 or October.2016. A few weeks after the February low I switched to the first one because the move was too strong and few months later we see SP500/DJ with new ATH. We have impulse higher and corrective move so more to the upside is expected. Currently I expect the next important low for long term trade in October. I do not expect the end of the bull market before mid 2017.