Briefing 9/25/22 – The Forecast

Briefing 9/25/22

Briefing 9/25/22

We continue to expect this bear market to finish over the next 1-2 weeks.  While we favor a brief relief rally to start this week, we keep our eyes on the prize of the final bear market low occurring shortly.  This week, more than 20 Fed members are set to speak – including Powell twice.  Such fervent Fed face-time amidst this market turmoil raises our eyebrows to even more intense volatility taking place over the coming days.  However, we believe this bear market low will be a great buying opportunity into 2023.

Short term thoughts:

9/26 – 9/27:  Relief rally

9/28 – 10/3:  Decline

Intermediate term thoughts:

Final bear market low occurring between 9/28 – 10/6 (target 3,200 – 3,600 SPX), then rally into 2023

Long term thoughts:

Recession 2023-2025, bull market into 2031

Last Week’s Economic Events:

Building Permits:  Miss

Existing Home Sales:  Beat

FOMC Rate Decision:  Neutral

FOMC Economic Projections:  Hawkish

Initial Jobless Claims:  Beat

Upcoming Economic Events:

Tuesday:  Fed Chair Powell speaks, CB Consumer Confidence, Core Durable Goods Orders, New Home Sales

Wednesday:  Fed Chair Powell speaks, Pending Home Sales

Thursday:  GDP (QoQ), Initial Jobless Claims

Gold is still at risk of a flash-crash to $1580 for as long as it remains beneath crucial support at $1680.

Oil is now approaching what we believe is a multi-year buying opportunity at $77.

Bitcoin’s break of $18k will likely signify ignition of this bear market’s last sell-off.  Once it breaks, the sell-off will be swift and sharp before the rally into 2023 begins.