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The Gold Bull Market and the SP 500 Index

May 17th 2010
Back in the third week of April I predicted here on a topping in the broader market indices. The theory was the VIX levels were extremely and historically too low concomitant with extremely high historical readings in investor bullish sentiment gauges. After thirteen Fibonacci months of a bull cycle rally, it was likely an A B C correction to the downside would begin. In further follows ups on service I run on April 20th, I again outlined concerns with falling volumes on small cap stocks and too many “stories” being run up too far ahead of the economics.

At this point in the Bull market, it is common to have the crowd of investors move from a bias towards viewing all news as positive, to a negative slant on all news. Nothing has changed dramatically on the problems the world had before with Debt and currencies, but the reaction to those events turns negative. This works off the overly optimistic Elliott Wave patterns of the crowd, turning into a typical Zig Zag correction that lasts several months. There will be trading opportunities between that Mid-April topping forecast and my forecast for a bottom around mid-September. However, as recommended in April, Index investors and mutual fund investors should have been moving to the sidelines. I am looking for the SP 500 Index to drop to the 920-970 areas by mid-September before the next leg of the Bull market takes off. Now, the one caveat to that forecast is actually a lot more bullish. If the SP 500 can hold the 1100-1110 areas and pivot up strongly, we could move on to new highs. I put the likelihood of that around 20%, so be on guard. A counter-trend rally up in the next few weeks is highly probable, but the evidence continues to suggest working our way down into the 900’s in the SP 500 before the Bull resumes in earnest. We are selectively buying Gold and Biotech stocks in the Active Trading Partners service as well.

Gold has continued higher confirming my April 20th forecast on The Market Trend Forecast of a move from 1125 to 1235 in Gold. The Elliott Wave patterns remain extremely bullish for Gold to continue a 13 Fibonacci year cycle up into 2014. Gold has formed a very bullish pattern intermediately for a move to $1470-$1550 at the next major pivot top. In the interim, I expect continued consolidation in and around my $1,235 US levels before the next pivot high at $1300-$1,325 US. Fiat currencies are burning matches as foreign governments and other entities continue to attempt to put out a fire by printing more paper and covering the same fire with it. Until the analysts on CNBC stop questioning the validity of Gold and start questioning the validity of Fiat Paper, the bull will rage onwards with most of the pundits watching the caboose from the back of the tracks.

SP 500 Forecast from the Mid-May TMTF forecast service updates:

Gold Forecast is for $1570 over 6-9 months with pivot at $1300:

Stock Market Forecasting

Be sure to checkout my market forecating service at

David Banister


Small Cap Stock Trading Service – ActiveTradingPartners

Hey Everyone,

I just wanted to mention the exclusive stock trading service David Banister and I launched in July. not only has an incredible track record of extremely high annualized gains on our Alerted Trade positions to Partners, but a very good track record of knowing when to Hold, Add, or Sell those same positions, as well as timely market commentary. Riding a stock or ETF to maximum gains is a difficult challenge, and ATP has successfully achieved this over and over again. Many services brag about how great they are at picking stocks or entering trades, but very few follow through with on-going advisories on those same positions, with sell advice at the right time, or with advice on whether to hold those positions through volatility.

Recently, before the recent market correction, ATP advised our Partners to close out of several of our very profitable positions completely. Below are a few samples:

VICL- Closed at $5.10, it dropped to $3.90 shortly thereafter.

SPPI- Closed at $7.15, it dropped to $6.27

CRXX- Closed at $1.80, it dropped to $1.27

JAZZ- Closed at $8.88, it dropped to $7.38

All of the above positions were recommended at much lower prices, and we trimmed profits at higher prices before closing them out. The last thing you want is to give back all your gains in the market.

Here is what some of our “Partners” in the service are saying recently:

Dave, I have not had the pleasure of talking/ meeting with you but just wanted to say how pleased I have been with the service thus far, Chris has been a good trading friend over the years and I am glad that he told me about this , I have probably made enough to pay for three years already.
Shaun Mahoney

We really appreciate the updates and information you supply on your site and your scorecard especially when the markets begins to worry us. When the market tries to shake us out, you provide a timely article to keep us on track. We are very pleased with the outcome of our trades since joining your service.

Thanks again for your constant support.
R.J and C.J–  Husband and Wife

“Hi Dave,
Just a quick note. Thanks so much for frequent updates and commentary. I have just finished first month as a partner. I have averaged over 15% returns even with losing one ATP pick as it got stopped out. Much of my portfolio was underwater when I joined up. I am turning things around as I am able and looking forward to big gains down the road. Very happy with the service. Thanks!”
Chris Webb, Wolfville, Nova Scotia

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Michael Swanberg

Learn more today at while we still have a few “Partner” positions available. The service is exclusive to only 200 subscribers.

Chris Vermeulen