Greg Guenthner

Behold! I have a foolproof, unbreakable, 100%-guaranteed stock market prediction for you this morning…

Summer is finally over. I’ve made the appropriate sacrifices and renewed my allegiance to the demonic league of market magicians. Now, you may watch in amazement (or terror!) as I gaze into my crystal ball to reveal exactly which direction stocks will move during this new trading month…

But before I reveal my exclusive market prediction, let’s check in with our trading expert Jonas Elmerraji

“I have a love-hate relationship with forecasts and predictions,” Jonas says. “Good traders don’t try to predict when an important price move is going to happen – we just react when it does. But forecasts can be very useful for figuring out context in trading. They help us gauge our risk/reward, and they’re useful for the rest of your non-trading portfolio, too.”

Hmmm… maybe I’ll drop my Carnac the Magnificent routine and we can take a more useful approach to the prediction business.

“Yes, this summer has been fairly quiet, but it’s also been pretty productive from a trading standpoint; we’ve been able to squeeze some solid gains out of the market over the last couple of months,” Jonas continues. “The summer doldrums everyone was expecting earlier this year? Never happened. Instead, stocks followed the exact same technical playbook that I’ve been harping on all year long. Now, the question is where stocks are going to be headed in September…”

S&P 500, June 2013 - Aug. 2014

Jonas notes that the S&P 500 is closing in on the top of its trading range again — which has typically been followed up by sideways consolidations ranging from one to two months.

“I’d expect stocks to track sideways and slightly higher for the month of September,” he says. “That’s being confirmed by one of the statistical technical programs in our toolbox. Based on the big index’s recent price action, our software puts the S&P 2.2% higher a month from now with 90% probability. That’s one of the highest confidence levels, I’ve seen from this software, and it’s important context that we should be keeping in mind as we trade in September.”

Of course, as Jonas explained earlier, good market forecasts are subject to change.

Regards,

Greg Guenthner
for The Daily Reckoning

P.S. If you follow the trends and pay attention to important levels such as the S&P’s big, obvious trading range, you’ll come out on top. Sign up for the Rude Awakening for FREE today to see how you can trade the trends for huge gains…

You May Also Like:


Blocking Out the Bubble Talk

Greg Guenthner

It's easy to say the market is in a bubble. It's been on an incredible run, and if you didn't get in on it, you're likely to feel a little scorned - and more likely to start throwing around insulting words like "bubble." Greg Guenthner explains why you should probably just ignore the "bubble talk." Read on...

Greg Guenthner

Greg Guenthner, CMT, is the managing editor of The Rude Awakening. Greg is a member of the Market Technicians Association and holds the Chartered Market Technician designation.

Recent Articles

How to Pick Up Gains in a Falling Market

Greg Guenthner

This has been a rough week for the stock market. Almost everything is down, and only a handful of stocks are propping up the major indexes. Is this just a typical October slump? Or is there more to it than that? Today, Greg Guenthner shows you how to navigate these markets heading into the final trading months of the year. Read on...


5 Min. Forecast
How the Swiss Could Set Off a Financial Avalanche

Dave Gonigam

There have been quite a few disappointing numbers in the global economy recently. But as these numbers are just economic "snowflakes" building toward a financial avalanche. All you need is one to push it over the edge. And as Dave Gonigam explains, the deciding snowflake may come from Switzerland. Read on...


Addison Wiggin
One World, One Bank, One Currency

Addison Wiggin

After the 2008 financial crisis, little could be heard over the deafening cries of "mission accomplished." And while the Fed's massive QE program seemed to work, the question remains: for how long? Addison Wiggin explains why the next round of QE will fail miserably, paving the way for the IMF to step in with something called "special drawing rights." Read on...


Addison Wiggin
Profit from Global Warming, Even if You Don’t Believe In It

Addison Wiggin

Global warming is one of the most debated subjects of the last few years. But regardless of whether you're a "true believer" or a merely an unconvinced skeptic, there are significant ways to make serious money from this controversial topic. Today, Addison Wiggin brings you three of them. Read on...


Don’t Drink the Tap Water (It’s Not What You Think)

Chris Campbell

Under the auspices of benefiting public health, the government has been administering medication to you and your family for generations. But is it really necessary? Or worse... Could it actually be harmful? Chris Campbell takes a closer look at this, and other personal health decisions the feds don't trust you to make...


Extra!
What to Hold When the U.S. Economic Blimp Deflates

Jim Mosquera

The inflation vs. deflation debate is a heated one. Heck, it almost brought Peter Schiff and Harry Dent to blows. But at the core of this debate is a common misunderstanding of the nature of both inflation and deflation. Today, Jim Mosquera seeks to explain each... and which one the U.S. is more likely to experience. Read on...