I posted this chart about a month or two ago (didn't publish here) but wanted to update what I think is a BULLISH case for stocks.
This does not HAVE to play out as the economy really does have a lot of problems. But it has played out for the last month or so.
Simply using the 1989 crash and correction as an analogue. We can at least see that we are nowhere near a parabolic blow off situation in QQQ. If one is coming, it could be a lot higher than here. My first target is +20% from the prior high or about 11600. After that, we'll just have to reassess and monitor the tape.
Geopolitically, this is what the US wants. The US -CANNOT- survive a downturn in stocks with the existing deficit-to-GDP or debt-to-GDP. It HAS TO inflate its way out of this mess. If they are truly committed to this (and it sounds like they are), I think these bullish targets will be CONSERVATIVE. In addition, they want to win some kind of GREAT POWER STRUGGLE vs China which it obviously cannot do if there is a debt deflation / depression. IMO, there is a whole lot more money printing dead ahead.
Perhaps at some point Gold will outperform QQQ, but they both should go up spectacularly (along with stagflation in the real economy and a great deal of suffering by the people).
This does not HAVE to play out as the economy really does have a lot of problems. But it has played out for the last month or so.
Simply using the 1989 crash and correction as an analogue. We can at least see that we are nowhere near a parabolic blow off situation in QQQ. If one is coming, it could be a lot higher than here. My first target is +20% from the prior high or about 11600. After that, we'll just have to reassess and monitor the tape.
Geopolitically, this is what the US wants. The US -CANNOT- survive a downturn in stocks with the existing deficit-to-GDP or debt-to-GDP. It HAS TO inflate its way out of this mess. If they are truly committed to this (and it sounds like they are), I think these bullish targets will be CONSERVATIVE. In addition, they want to win some kind of GREAT POWER STRUGGLE vs China which it obviously cannot do if there is a debt deflation / depression. IMO, there is a whole lot more money printing dead ahead.
Perhaps at some point Gold will outperform QQQ, but they both should go up spectacularly (along with stagflation in the real economy and a great deal of suffering by the people).
Next up is likely a "running correction" that is needed to shake off some of the euphoria (the amount of call buying is crazy). I expect a week of consolidation to show up soon, and then further upside.