This "forecast" may be a bit on the extreme side of the forecast as I drew the top line first, then the bottom line. However, I doubt it will get to the "massive support level" I have labeled - but at least a move towards it into the end of the year would make sense to me.
Risk: 3 Average Daily Ranges (11-day avg of high-low true range).
As for the whole market: Here is a simple pattern that has been useful to follow for decades.
The usual pattern is: First goes the bond market (down big this year), then banks and financials follow, then industrials, then transportation, then everything else. Technology is always last in major markets. For example. Microsoft hit new highs until a week before the crash in 1987 . So, don't be lulled into thinking that because new era are surging ( FB , AMZN , Biotech, Internet vapor ) that the market is fine. I'm not forecasting a melt-down or a crash at all... just a sideways to lower market for the next year or so to let the market grow into its valuation.
Until next time: Happy Trading
Tim 12:16PM EST, Thursday, September 26, 2013
On the other hand a couple "money center" stocks are looking like they are ready to push higher. One of my recent positions $MTB looks pretty strong.
It will be interesting to watch how the banking sector finishes out 2013.