“… We have been looking for the market to retest the spike low from August at 1,867, and then medium-term support at 1,820, the October 2014 low. With several key sectors now also falling to major support levels – notably industrials ‒ and looking vulnerable, we think the risk a major top may be established has risen sharply.
“Below 1,867 should keep the risk lower for price and ‘neckline’ support at 1,832/20. Below here would mark the completion of an important top, turning the core trend bearish. If achieved, we would target 1,738/30 initially – the low for 2014 itself, and the 38.2% retracement of the 2011/2015 uptrend. Although we would expect this to hold at first, a break would be favoured in due course for 1,575/74 – the 38.2% retracement of the entire 2009/2015 bull market. …”
“We’ve obviously already had a significant fall in the stock market, triggered by the breaking down of the lows we saw earlier this year. The big question now is whether this is just a correction in a bull market,” [a member of the Credit Suisse team] told us. In his mind, tumbling past 1,820 would signal that the market move could be something bigger.
On the plus side, a move above 1,953 could help ease selling pressure, the Swiss bank said.
— Excerpt contributed by Roger Crandell
Z-val definition and more forecasts in The Z-val Zone.
Here are your three options:
Option 1: Annual Subscription
For just $236.97 per year, you’ll receive everything listed above to completely upgrade the way you manage your investments, including a copy of The 3% Signal. This is what I recommend:
Option 2:Monthly Subscription
If you'd like to try The Kelly Letter without paying the full year, you can pay $19.97 per month, but it will not include a copy of The 3% Signal :
Option 3:Free Email List
If you'd like to hear more from me but aren't ready to part with any money yet, you're welcome to join my free email list:
Join Matt and thousands of other rational investors to invest without stress.
Subscribe to The Kelly Letter now!