Guesstimates on September 21, 2012

December S&P E-mini Futures: Today's range estimate is 1455-65.  The ES is headed much higher over the next few months. Support beneath the market now is at 1430.

QQQ:  A move to 76 is underway.

TNX (ten year note yield): The Fed announcement is going to push bond yields much higher as the market begins to anticipate stronger economic growth. The first upside yield target for the 10 year is 2.50%.

Euro-US Dollar: The ECB and the Fed are following polices which will move the Euro to 1.40 or higher. Next resistance is 1.3350.

Dollar-Yen: This market is headed for 75 and lower. The Japanese central bank has announced an increase in their own program of quantitative easing. But they don't have as much credibility on this score as the Fed does so I think the dollar-yen  will continue its drop to 75. At some point the JCB will have to support the yen but this probably won't happen until the 75 level is reached. November Crude: The market is now is on its way to the 110-115 zone. Support is at 90-91.

GLD – December Gold:   I think gold is headed for 2300.

SLV - December Silver: I think silver is headed above 50.00.

Google: Google is headed up to 750.

Apple: AAPL  has reached the 690-700 zone. Next upside target is 718.  Support stands at 645.

S&P

Here is a weekly chart of the cash S&P 500 going back to the 2007 top.The wavy red line on the chart is the 40 week moving average, a rough-and-ready indicator of the market's long term trend.

As is obvious on this chart the long term trend in stock prices has been upward since the March 2009 low. The advance is getting a bit long in the tooth, having lasted 42 months so far. It is unusual for a bull market to last this long. However one should note that the bull market which followed the 2002 low lasted 60 months while the bull market which followed the 1932 low lasted 56 months. These latter two bull markets started after drops of more than 50% in the market averages had occurred. The 2009 low also marked the low of such a drop and a 56-60 month bull market would carry at least into late 2013.

Mu guess is that the current bull market will not last that long, but I do think it has a good shot of reaching and perhaps exceeding a bit the 2000 top at 1553 and the 2007 top at 1576 (top two red dash lines). It is worth noting that the market began to "flat line" (trade sideways) after its 2000 top and so far has done so for more than 12 years. The last flat line period lasted from 1966 to 1982, a period of 16 years and the one before that from 1929 to 1949, a period of 20 years. Based on these two precedents we can expect another 4-8 years of a stock market which goes essentially no where long term.

During the 1966-1982 flat line period there were five distinct bull market tops in the Dow a little below or a little above the 1000 level. So far during the 2000 - ? flat line period in the S&P there have been two bull market tops in the 1553-1576 zone. My best guess is that the next one will also be in that general vicinity.

The subsequent bear market should prove to be less dramatic than the 2000-2002 and 2007-2009 breaks of more than 50% each. My guess is that it will pull the S&P down about 30% to the 1000 level before it ends.

In the meantime I think the S&P will continue its rally back to the 2000 and 2007 tops which are about 100 points above the market currently. I have drawn two purple boxes which offer a conservative projection for the extent of the rally which started in June of this year. That projection would put the S&P up near it two preceding bull market tops and near the rising green dash trend channel you see drawn near the top of the chart.

Guesstimates on September 20, 2012.

December S&P E-mini Futures: Today's range estimate is 1442-53.  The ES is headed much higher over the next few months. Support beneath the market now is at 1430.

QQQ:  A move to 76 is underway.

TNX (ten year note yield): The Fed announcement is going to push bond yields much higher as the market begins to anticipate stronger economic growth. The first upside yield target for the 10 year is 2.50%.

Euro-US Dollar: The ECB and the Fed are following polices which will move the Euro to 1.40 or higher. Next resistance is 1.3450.

Dollar-Yen: This market is headed for 75 and lower. The Japanese central bank has announced an increase in their own program of quantitative easing. But they don't have as much credibility on this score as the Fed does so I think the dollar-yen will continue its drop to 75. At some point the JCB will have to support the yen but this probably won't happen until the 75 level is reached.  

November Crude: The market is now is on its way to the 110-115 zone. Support is at 90-91.

GLD – December Gold:   I think gold is headed for 2300.

SLV - December Silver: I think silver is headed above 50.00.

Google: Google is headed up to 750.

Apple: AAPL  has reached the 690-700 zone. Next upside target is 718.  Support stands at 645.

Guesstimates on September 19, 2012

December S&P E-mini Futures: Today's range estimate is 1453-65.  The ES is headed much higher over the next few months. Support beneath the market now is at 1430.

QQQ:  A move to 76 is underway.

TNX (ten year note yield): The Fed announcement is going to push bond yields much higher as the market begins to anticipate stronger economic growth. The first upside yield target for the 10 year is 2.50% 

Euro-US Dollar: The ECB and the Fed are following polices which will move the Euro to 1.40 or higher. Next resistance is 1.3450.

Dollar-Yen: This market is headed for 75 and lower. The only fly in this bearish ointment is the central bank of Japan. If they decide to support the yen then they implicitly will be embarking on a course parallel to the Fed and that would be very bullish for the Japanese stock market.

November Crude: The market has broken past all resistance level. It now is on its way to the 110-115 zone.

GLD – December Gold:   I think gold is headed for 2300.

SLV - December Silver: I think silver is headed above 50.00.

Google: Google is headed up to 750.

Apple: AAPL  has reached the 690-700 zone. Next upside target is 718.  Support stands at 645.

Guesstimates on September 18, 2012

December S&P E-mini Futures: Today's range estimate is 1448-62.  The ES is headed much higher over the next few months. Support beneath the market now is at 1430.

QQQ:  A move to 76 is underway.

TNX (ten year note yield): The Fed announcement is going to push bond yields much higher as the market begins to anticipate stronger economic growth. The first upside yield target is 2.50% .

Euro-US Dollar: The ECB and the Fed are following polices which will move the Euro to 1.40 or higher. Next resistance is 1.3450.

Dollar-Yen: This market is headed for 75 and lower. The only fly in this bearish ointment is the central bank of Japan. If they decide to support the yen then they implicitly will be embarking on a course parallel to the Fed and that would be very bullish for the Japanese stock market.

November Crude: The market has broken past all resistance level. It now is on its way to the 110-115 zone.

GLD – December Gold:   I think gold is headed for 2300.

SLV - December Silver: I think silver is headed above 50.00.

Google: Google is headed up to 750.

Apple: AAPL  has reached the 690-700 zone. Next upside target is 718.  Support stands at 645.

Guesstimates on September 17, 2012

December S&P E-mini Futures: Today's range estimate is 1450-59.  The ES is headed much higher over the next few months. Support beneath the market now is at 1420.

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The Fed announcement is going to push bond yields much higher as the market begins to anticipate stronger economic growth. The first upside yield target for the 10 year is 2.50% 

Euro-US Dollar: The ECB and the Fed are following polices which will move the Euro to 1.40 or higher. Next resistance is 1.3450.

Dollar-Yen: This market is headed for 75 and lower. The only fly in this bearish ointment is the central bank of Japan. If they decide to support the yen then they implicitly will be embarking on a course parallel to the Fed and that would be very bullish for the Japanese stock market.

November Crude: The market has broken past all resistance level. It now is on its way to the 110-115 zone.

GLD – December Gold:   I think gold is headed for 2300.

SLV - December Silver: I think silver is headed above 50.00.

Google: Google is headed up to 750.

Apple: AAPL  is headed to 690-700.  Support stands at 645.