It appears as though the market has finally put in a top
I’ve been very cautious on the markets for quite a period of time. Although I have reiterated that the Fed is your friend and not to fight the trend of the market, which until recently has been trending up. If you look at the above chart you’ll find that the markets had been moving sideways, with a top around 2130 in May and July of this year.
The markets have now broached both the 50 day and the 200 day moving average which is not a good sign. It appears that my target for the S & P 500 of 2160 will not be reached but coming in at 2130 is pretty close given that we started from 666.
Many people are looking at this decline as a buying opportunity. It may be, since the Fed has been know to manipulate the markets. It’s easy to see the markets moving back up to the 2050-2070 area with the Feds help. If the Fed is going to raise rates in September then they’re going to need to get the market back under control and they have been successful in this before.
Downside Targets for the S & P 500
The use of point and figure charts looks at a couple of price objectives at 1760 and 1400. When these objectives will be reached is anybodies guess. The Fed has been successfully manipulating the markets for a time. Remember world banks have been buying stocks, which had been an unusual occurrence until the last few years.
So, yes I’ve been advocating being protective of your investments. Only time will tell if the Fed will act to shore up the markets. If they don’t then the markets free-fall may just be beginning. If they are successful in stopping the hemorrhaging then I believe that they will be just delaying the inevitable.