Reminick Letter: 10/12/2010
The stocks and commodities markets rallied fairly uniformly in September. Stocks, gold, bonds, soybeans, crude oil, corn, Japanese yen - all are moving up. The US Dollar has been the most noticeable contrast, with its severe decline. Our analysis is that these trends will likely continue until December or even March 2011.
GOLD has rallied to $1366 per ounce, and we expect it to be higher by year-end.
US TREASURY BONDS are in a continued uptrend until late December, with a target of $136-$138.
CRUDE OIL is in a rally phase until December, with a dip after the November elections.
GRAINS are likely to continue up until March 2011, with a January decline on the way up.
US Stock Market
S&P price: 1161
DJIA price: 11,006
Long-Term Trend: DOWN until 2015, with a high in 2012
Intermediate Trend: UP until December 20, or April 2011
Short-Term Trend: UP till October 20 or 27, with a DJIA target of 11,250-11,350; then
DOWN until a low on December 5 to about 10,350-10,500 for the DJIA; then
UP again to December 20, to DJIA 11,450
Comments:
The Dow Jones Industrial Average has been more bullish in October than we expected. Considering the trends, there is likely more upside to come until a high point in late October, or at the latest November 5.
We are no longer expecting DJIA to reach 9000 this year. Instead we expect a range for stocks between 11,350 and 10,000 over the next four to six months.
The market is following the 16.15-year cycle, which is part of the 10-year, 16-year, 26-year, and 42-year series of cycles - and is likely to continue this action. 8/16/1994 matches 10/08/2010 very well for the last few months. This trend calls for a rally till late October, a decline to December 5, and another rally till December 20, ending the year near the highs.
January 2011 should produce a severe decline, taking stocks to February lows.
Gold:
Price: $1347 per ounce
Long-Term Trend: UP until December 2012. Price target of $1600 per ounce
Intermediate Trend: UP until December; target of $1390; then
DOWN into May 2011, to $1050 an ounce.
Short-Term Trend: DOWN until October 23, to $1290; then
UP to $1390 by November 30
Comments:
Gold is likely to rally further until late November or early December. We are looking for $1390 per ounce this year. There could be a sharp break, ending in late October, which would provide a final buying opportunity for this year.
US 30-Year Treasury Bonds
Price: $134 10/32
Long-Term Trend: UP until the end of September 2011, with a target of $140
Intermediate Trend: DOWN until November 10; with a target price of $129
Short-Term Trend: UP, to finish a rally by October 31; target of $136
US Dollar:
Price - 77.563
Long-Term Trend - UP until some time in 2014; target price of 120
Intermediate Trend - DOWN to December, with a target of 74; then
UP to February 2011, 85 target; then SHARP DECLINE ending in May 2011, with a target price of 72
Crude Oil:
Price - $82.66 per barrel
Long-Term Trend: UP until early 2012, targeting $110 per barrel
Intermediate Trend - DOWN until mid-February, target of $65-$70 per barrel.
Short-Term Trend - UP until October 27, targeting $85-$86 per barrel; then
DOWN HARD with the stock market into December 5 lows, to $75
Comments:
Crude oil and the Down Jones Industrial Average have been highly correlated for several years now. They are likely to continue to follow each other and trend higher till year-end or April 2011, before any major correction.
Natural Gas:
Price - $3.65
Long-Term Trend: A new move has yet to begin. But once it does, expect two years of UP until late 2012, with at least a $12 target
Intermediate Trend - UP until April 2011, with a target price of $8-$9
We still expect a strong rally, probably starting mid-October. This is still the Best Opportunity out there right now, and it is likely to start in the next few days or weeks, at the latest.
Trading cycles of 118, 708, and 648 are all bottoming soon.
Soybeans
Price $11.35 per bushel
Long-Term Trend - UP until June 2015; target $18-$21 per bushel
Intermediate Trend - UP until March 2011, targeting $12.50-$13; then
DOWN until October 2011, target $7.50 per bushel
Short-Term Trend - UP until December 20, target of $12.50; then
DOWN HARD until approximately February 9
Comments:
Soybeans and corn are in a strong uptrend until March 2011, with a $12.50-$13 price target. After that, we expect a severe collapse from April 2011 until September 2011, with a $8 price objective. There could be a pullback in January on the way up.