Steve, Thinking of you! Blessings! 

Steve, Thanks for the great market coverage. Get some rest brother. All the best

The action has been terrible since the beginning of the year, but we are at a 25 RSI in the SPX and QQQ now, We did have about a 12% correction from the highs. I was looking for 10-15% total. Unless the Apple report is horrible, I believe we are carving out a trading bottom. That being said, if the recent lows on SPX were to break, it would be easy to be very constructive at the 15% correction level, starting at 4,095 or a bit lower over the next 12 months for me. I think the Fed stuff is priced in now.   

One thing that does concern me longer term is the monthly closes chart on the indexes. It is pretty stretched for the long term and would be healthy to see it reset a bit.   The middle Bollinger Band on the monthly closes for SPX is a bit under 4,000 right now. That would align pretty close to the greater end of my corrective forecast. This forecast is based on the what we know, of course the answers likely lie in the what we don't know.

even better than I expected so far, booyah   

it will be broken at some point, we will see a big trading rally, 3 gaps above now starting with 4,397, Friday's close. I've been thinking 100 SPX points once we see a low. If today was it at 4,243.50, then it sees 4,343.50 minimum for round numbers, and possibly back to that gap I mentioned over time. I still believe the earnings reports will be important, though wonder if some of this is getting priced in already. See, didn't even need a chart, I'm just guessing like everyone else here, analysts, etc.   

I think we should all start over in the meta verse, you don't have to work, own fictitious coins, can buy digital house, or whatever you want with real money in a land that's fake. 2022, the land of tik tok, video games,  media, and social media pollution. Maybe if we move into the meta verse we can avoid sickness or become our favorite superhero.   

Oh it has been horrible and shouldn't have been done. I said long ago we had no backstop or room for error if an unexpected world issue occurred. That turned out to be covid. Its ok, no problem, just print more lol

I think that is the Fed plan here, to take inflation off the table with some lip service and small increases. Looks more than priced in now for going forward to me or mostly. The surprise will be when they come up dovish and only increase 2 times or 3 vs. 4 and announce the inflation numbers are better than expected, employment stabilizes, etc. These next earnings really need to look good from companies like MSFT and AAPL this week though. Guess we will see. 

I'll increase equities in one of our IRAs by 14% today on market close. Fortunately I had built a significant cash position at market highs. Even if we were to range trade this year, I like the move longer term as I do think we will make new highs again at some point down the road be it this year or next. 

At the start of the year, I was looking for a 10-15% pullback in the SPX. We undercut the 10% target at 4,336 and it went to 4,272 on the low today, correcting over 11% so far. RSI is now 22 and oscillators are off the charts overdone. Risk/reward and asset allocation. 

4,363.80 is the gap and 4,336 is a 10% correction from the highs in SPX

Steve, You are sounding like an excited weatherman when there is a hurricane. These newsletters are classic. Great coverage   

$SPX wonder if that 4,568 gap will fill that started the big rally last year? Straight down at the moment. Maybe that's the area to get long for a trade? Let's see where she stops. We have a gap above now at 4,677.

Long XBI via LABU off the $100 support here   

Great job. I did the same as I posted earlier in my one IRA, very happy to declare victory on that portion. 

XBI should be a great place to be in 2022 if history continues. It would be extremely rare for it to have two down years in a row. I'm long a starter off the double bottom from a bit back. LABU is the 3xetf

Happy New Year everyone   

I'm declaring victory on all my S&P 500 funds remaining in my one IRA at the close. I have good inventory there from buying during the last crash and many dips along the way I've accumulated. I will keep our other IRA invested (my wife's) with a 16% allocation for now. I believe if there is a correction at some point, the S&P will take the brunt of it. The monthly closes chart Matt/Steve have shared provides good insight to the trajectory of this rise (I've attached it in this post). My maximum target for the S&P next year would be 5,000 IF it happens. So I'm preparing now and feel good about this move. 

I still have my QQQ, EFA, IWM, MDY allocations as well as a handful of other individuals in small caps. Still have my health sciences holdings as well via PRHSX. They should continue to perform well as they have for years. We are carrying some cash that we won't need for a while in I Bonds which are paying 7.12% and compound semi annually. This will keep cash performing well and if inflation persists, the rates will remain elevated. Can only do $10,000 per year per person in those though it is still a deal. This bucket we put funds we know we won't need for at least 12 months. 

We have significant municipal bond fund assets that we acquired during the Meredith Whitney scare years ago. Those were insane prices to buy at and they are still paying and compounding tax free.  We have our smallest portion in bank accounts as they pay nothing, just for paying bills and a few bucks on hand if we need it. 

Been watching this one close, was able to trade it recently with LABU (3x etf). The performance history has been down years followed by up years. I'm watching for entry like many others. The big companies are relying on these smaller ones for growth and valuations are much more reasonable now:

https://finance.yahoo.com/quote/XBI/performance?p=XBI

Happy Birthday Steve! 

Great call Matt! Could you please include the extreme pivots chart for the SPX the next time you do the newsletter/when you can? That has been very helpful for me trading. Thank you and Steve for the great coverage

Have a great time with your family, Steve! Thanks for the great market coverage as always.