We expect the SP 500 Index to rally to 2177 by the end of the year in a Wave 3 up from 2023 pivot Wave 2 lows recently. We are seeing relative strength pick up right now in the Small Cap index as well as the US Dollar breaks even higher once again. Commodities continue to downtrend, Oil is trying to put in an ABC base pattern bottom, and Gold hitting new lows for the cycle.
Opportunity therefore continues to knock for investors during this “Primary Wave 5” cycle up in the Bull market. Our topping targets are 2177, 2202, and 2271 ahead over the coming weeks and months.
The NASDAQ has been a bit stronger than the traditional SP 500 and Dow indexes of late. Much of this due to strength in Internet/Retail, Gaming and Software, and lately Biotech regaining traction.
To wit, back on October 23rd we got bullish on many Biotech stocks as they were washed out and out of favor. We recommended XON, ZIOP, LABU ETF, KITE, JUNO and many others just prior to 20-40% gains across the board. We continue to like many of those names at SRP and are positioned still in a few as well going into December.
Chinese retail related and tech names have been strong with good relative strength as investors focus on the consumers there and the growth ahead.
With the US Dollar breaking out of a recent 13 day base pattern to the upside, more pressure has been put on GOLD as it has hit a new cycle low from the 2011 highs at 1058 recently.
In most recent surveys of Investment Managers, Bulls are now at 45% which is close to the long term average, but still well below the high of 58% this past spring. Bears are back to 27% after hitting 45% back in late September.
In short, we expect the market to trudge higher in a current “Major Wave 3” pattern off the 1871 lows in September. This current rally is in an 8 trading day base in terms of the SP 500 index as of Monday’s trading, and we would expect a sharp move to the upside shortly…
This weekend we have a small list of stock symbols and brief notes on growth stocks that look attractive both in terms of their fundamentals and their technicals. We will need to so some more work on these names, but its a good starting list for further due diligence and likely some of them wind up as swing positions for SRP members ahead.
LGIH- HomeBuilder growing in the faster regions of the country with a PE Ratio at 16 and recent 100% Growth rates
CBM- Contract manufacturing and drug development for the Biotech industry. Business is booming at 60% growth rates with a PE ratio at 27 and a nice chart.
HAWK- Gift card service provider we have highlighted numerous times, now coming out of a 20 week breakout pattern, PE Ratio 21
NOAH- Chinese provider of Investment services and products in a nice 8 week base
WETF-4 week bullish ascending base for this provider of ETF investment products with strong growth
PRAH- See CBM
ABTL- Internet Content/Retail is one of the strongest areas in the market, combine that with Auto industry and you have a winner. Breaking out of 8 week base pattern.