Wednesday, July 24, 2013

Beginning Of The End?

Could today be the beginning of the end for stock market's ascent higher? Good earnings from AAPL did not help SPX penetrate 1700. I am not an AAPL fan, nor do I want to make too much emphasis on the stock. But I think that AAPL is heading higher. What is more surprising - I think that at the same time SPX is going to go lower. What??? Yes, this is my outlook: AAPL will outperform SPX for the rest of the year, and in the next month or so tremendously. I think that SPX will eventually catch a bottom around 10% or so below today's high, and will head higher as well.

While I do not really give a darn about AAPL, which now looks like it may have put in a double bottom, and may be trading in 505 - 555 area by the end of the year, I do want to zoom in on SPX and try to predict its possible targets on the downside. It is all going to depend on how the price reacts to the yellow lines on my chart below. Once they go, blue lines are going to act as magnets.

click on charts to enlarge

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