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    SPY/QQQ have another 30% upside before a major correction.


    I know this sounds crazy to most bears and probably bulls as well, but everything I’m charting and gathering from past recessions/bear markets tells me we still have plenty of room to go up before we should all consider buying long dated puts and singing YMCA

    First from chart perspective, both SPY and QQQ are above their 50 and 100 daily moving averages and they have both support around strong Fibonacci levels. If they both manage to reclaim August, as in forming either a bullish reversal on the weekly candle or forming a bullish hammer on the month (SPY 550 or QQQ 460) than we are 100% likely to see a strong blow off top before end of the year as we are also in an election year which is very bullish.

    Second, we are all aware of the obvious which is the consumer is weakening (see earnings for most consumer stocks) and that credit debt is rising. But we do know that tech spending is still high. Amazon, microsoft and meta are all raising capex regardless of the consumer. They know the key now is to prepare for leveraging AI as a service. They can weather a 12-24 month recession. They have billions in cash with very low debt to equity ratios.

    So as such, expect Nvidia earnings to keep rising, and for Amazon/microsofts cloud services and AI systems to grow while their more consumer side of business slows down or goes stagnant for the next year.

    Third, I expect layoffs and mass defaulting to occur sooner rather than later. But I do not think this will impact the stock market. Until tech is positioned to stop giving every dollar they can possibly shovel to the mag 7, once all infrastructure is tapped out and exhausted, will we see the market turn over and retrace. The fed will likely raise rates in September and we will see the yield curve potentially uninvert after more than three years. But it will take 6-12 months before this causes a market downturn because we will rally from the news for quite some time.

    For SPY; long to 650, short to 500 level. Don’t do anything else till then.

    https://i.redd.it/rzyj6buv5whd1.jpeg

    Posted by JGWol

    View 29 Comments

    29 Comments

    3. Life_Walrus_4263 on

      news drive the market

      tradewars, taiwanwar, inflation, japan mega earthquake includont tzunamies, there plenty of room for news

    6. Traditional_Grand837 on

      Thank goodness the lore bullish sentiment I see with absolutely no real back bone the happier it makes me that I bought puts

    9. RetiringBard on

      “We will go up 30% before end of year” says wsb user

      This is a godawful sentiment signal, all…

    10. InterstellarReddit on

      My bro draws a line and then thinks he’s an expert selling advice to people

    15. Glyph_meister on

      Thanks for the analyses, I found it interesting.
      SPX will clearly reach 6.5k at some point, the question is when?

      Within this year is not very likely, it would mean SPX gained close to 40% in a year, which is excessive.

      However, I do think the next few months will be volatile, and there might be a lower bottom coming, maybe below 5k, depending on news, rates, inflation etc.

      I also believe the market will do very well after the election, maybe a little sooner, but that’s still a ways off, and could change, but that’s usually how things work.

      Talk of recession and slowing economy is not that uncommon in august and september, it usually passes, and hopefully it does this time as well, and doesn’t end up being a real problem for the economy

    17. alan5000watts on

      “The Fed will likely raise rates in September”??

      Is that what you meant to write?

    21. izzytheasian on

      Honestly not a bad line. This is the camp I’m in. Everything thinks a recession is coming but we are about to get cuts BEFORE a recession is happening. In the past cuts were the REACTION to a quickly mounting recession. We are likely fine for a while and once people realize that we will rally until there is a true recession whether it’s from rates or something else. But I also think 6-12 months down the line if not later.

    23. Mroder1 on

      This has a 50% chance of happening. It either will happen or it won’t happen

      Source:trust me bro

    25. Syab_of_Caltrops on

      I completely agree. Last week was a major test of the uptrend, and both QQQ and SPY rebounded gloriously above that trend. Same thing happened 10 months ago and the market went parabolic afterwards.

      Bers, you have been warned ![img](emote|t5_2th52|4276)

    28. BuzzyShizzle on

      No I do actually think he’s right.

      Sort of.

      IF there’s a crash it will most certainly be preceded by the stupidest bull run you have ever seen.

      We have not even seen the IPO wave that comes with a bubble yet.

      I’m effectively a perma-bear and even I will be betting on SPX to 6000.

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