As I read through various articles over the weekend, there is a certain doom and gloom crowd starting to resurface. As is true in every bull markets, bears continue to cry “wolf” so many times that investor’s become complacent from their inaccuracy, only to miss the opportunity to exit equities near a meaningful high. By combining both our Elliott Wave and Hurst Timing analysis, the time to cry “wolf” isn’t now, but will most likely occur later this year in the November timeframe, at which time our expectation of an 18-month correction that will then set the platter for another meaningful move higher from those corrective lows. Allow me to explain.
The correction that commenced in late January of this year should complete shortly into the 2,470 region, and while less probable could reach as low as 2,333, in what is considered – using Elliott Wave vernacular – the miner degree wave 4 of the intermediate degree wave (5) of the primary degree wave (3). While less probable, this current pull back could reach as low as the 2,333 region. Upon completion of this small cycle correction, our expectation is that the next move higher will allow the S&P500 into the 3,200 – 3,300 regions, or approximately 30% from our expected correction lows, before investors would want to exit core equity positions for a much more meaningful correction.
Upon completion of this next leg higher in the S&P, our expectation is for a move back down to the 2,330 – 1,850 levels by early to mid-2020, at which time investors would want to reallocate capital back into equities.
For now, though, don’t allow those crying “wolf” to shake you out of your core equity positions, and in fact we are fast preparing our shopping list of key individual stocks that will afford our members the opportunity to capitalize on the next move higher, with entry levels and expected price targets on companies like GOOGL, CAT, AXP, DIS, and many more.
Doom and gloom maybe on the horizon, but it’s not here yet, and while the meat of the move off the 2009 low might have already occurred, there is still an opportunity for investors willing to be patient just a little while longer.