For Monday, June 25, 2012, the market forecast is a growth-trend

We recommend any leveraged Exchange Traded Fund (ETF) that grows with the US market, but please read our comments below before investing as our subjective opinion differs from our automated forecast.

2-Times Leveraged ETFs


Russell 2000

S&P 500




3-Times Leveraged ETFs


Russell 2000

S&P 500




Technical Comment:

The S&P 500 advanced 0.7% on Friday with volume above Thursday and higher than the 30-day moving average volume.  The S&P 500 would have to decline about 17 points (-1.2%) on Monday to trigger our stop-loss algorithm and change our forecast to an uncertain trend.

Subjective Comment:

Friday’s market action on the S&P 500 was a very strong volume day, making it a strong-volume up-day.  It takes more than one such day to form a pattern predictive of growth, so this one day does not change our technical interpretation of the stock market.  If a pattern develops, we will comment on it.  Given the fundamental conditions of the US Money Supply, we are very bearish on the US economy and stock markets, so it is very unlikely for continued strong-volume up-days to occur going forward from here.

This past Wednesday and Thursday we provided detailed analysis of the current US M2 Money Supply growth rates.  If you have not read these posts we encourage you to do so.  Our recommendations remain unchanged from what we discussed earlier this week.  One item to note is the Eurozone and the potential for brief “good” news from the various summit meetings as the leaders of the various countries meet and try to find a “solution” for their debt crisis.  There could be news that causes a day or two of growth which could spill over into the US markets.  So while we are bearish on US markets and economy for reasons discussed the past two days, we are not yet advising a short strategy.

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