New York declined sharply today as investors are waking up to the reality that the assortment of economic problems (inflation, recession, etc) won't be going away any time soon. The Dow closed at 11,483, below the January support level of 11,500 while the S&P ended the day at 1283. While I had thought we would have more of an up week, this decline comes as no real surprise given my bearish forecast for next week and generally gloomy outlook for stocks worldwide.
The severity of this sell off underscores just how pivotal the coming two weeks will be as Mars applies to Saturn. The S&P now has the all-important 1270 support level in its sights and if we break through that in the coming days, then the market will be in real trouble. I think we have some ways to go on the downside, possibly as much as 10%, which would take the Dow below 10,500 and 1170 on the S&P. Those are worse-case targets though and are little more than guesses. I'm loath to predict Friday's trading, as things could go either way.
The BSE has managed to stay above 14k so far, but no doubt will sink below tomorrow. It seems I will be off in my forecast of Friday levels. It is going to be vulnerable to steep losses in the coming weeks.
As predicted, the Euro is having a bullish week as the greenback sold off in the wake of the Fed meeting that left rates unchanged. It's already at the target of 1.57 and tomorrow bodes well.
Oil gained over $5 Thursday and closed at or near a record of $140. This confirms our bullish forecast for Oil for the week. We'll easily hit $150 next week as Mercury crosses the ascendant of the Futures chart.
In a stunning turnaround, Gold rose over $30 today and hit $915 after being down in the earlier part of the week. It is well within range of our target price of $920. I am expecting prices to stay strong here and it may move higher Friday.
