Account Net-Liq: $6,801.82
SPX value: 3,294.61
Shiller PE: 30.70
The problem of all bears out there predicting the second crash is that it is their wishful thinking and prayers. They again look at metrics such as PE, or other valuations and completely ignore FED and that those metrics do not work when FED is involved.
Yet, the Market started hugging the belly of the trend and keeps moving higher. But, if we look at longer-term daily and weekly charts we see a different picture all of a sudden. We are near the gap which happened in March 2020. I believe, this gap will have to be closed before we see any further action.
We are also near the resistance and pain area where many weak hands may want to unload their positions unless they did it all in March when they panicked and sold everything. If this is the case, we may see a new ATH in making here. We had 2 months of consolidation of the previous gains – that is good for the market no matter what you think of it. We recovered the majority of the losses and now we consolidated those gains! And recently, we broke up from the consolidation pattern. We re-tested that breakout – also a good thing for this market. And recently, we continued higher:
Of course, in this “pain” area, we may see a lot of choppiness and war between bears and bulls but it seems, bears have a weak hand here.
The weekly chart is even more descriptive in where we are heading next. And, in my opinion, it is not down.
You can choose and decide to fight this market and short it but it would be a painful fight. Short term, yes, we may see some pullbacks but medium to long term, we are going to ATH.
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