Nov 17, 2008 Week Ahead

The futures are down in pre-market trading as we complete the powerful bull flag in what looks like a wave 'b' of Y of a larger B, not a wave 2 as some suggest (tho' I could be wrong) as the pull back is deeper than most wave 2's typically. A move back to tag the falling 50 day moving average (currently around SPX 1040/50) is in the cards in the coming days.

The 4/12 day cycle suggests a minimum date of Thursday Nov 20th for a top. The bigger 16 day cycle (+/- 4 market days) tops out about Wednesday next week (just before Thanksgiving), so we should see selling more after Thanksgiving than before I would think. The larger 13 week cycle top +/- 2 weeks tops out no later than Nov 24.

A move back to the 23 week cycle low is projected for about Dec 23 and targets remain around 788/793 SPX with higher prices into mid Feb expected after that.

Recap: We remain long the stock market expecting a top in the next week or 2 and then further weakness into just before Xmas. The gold mining shares will probably have strength into around Thanksgiving or just before. While the seasonal trend combined with the 8 year cycle in gold mining shares looks strong into about the third week of December, the stock market low expected around that time and tax selling may abate the normal seasonal cycles this time around. It remains to be seen.

Gold mining shares remain a trader's market for now, but with longer time projections favoring this sector over the stock market in general (which as I have stated before) has projections to SPX 443 in the Jul/Oct 2010 and Mar/May 2011 time frames.