Key insights
- The author believes the recent market rally is a dead cat bounce due to escalating tensions between Israel and Iran. They predict the S&P 500 will decline to 6100, then 5800, and finally 5700. They also forecast a rise and subsequent fall in gold prices due to higher-than-anticipated inflation. Geopolitical risks and unresolved issues are cited as key drivers for this bearish outlook.
I had reservations that Donald would Taco given the seriousness of the situation and allegiance to help Israel but he did. Timing is perfect, it helps much of his rich capitalist base, end of Q1. Clients will see +2.4 percent to the damage done.
Now here is the case for taking profit while you can:
\- Troops continue to pile into the area
\- Israel will not allow Irans demand to never attack them again.
\- The US wants them to give up drones and missiles, won’t happen
\- The US won’t let them enrich uranium for Energy, while others can
\- Israel and the U.S. can’t attack the proxies , when they had free reign to
\- The U.S. republicans can’t abandon their pledge to Israel, it would lose the entire 2028 election
\- Other counties think leaving the strait closed is a very bad outcome, it hurts China , and much of Asia
\- Iran is already making 2x on oil, they are killing it and don’t need to negotiate
Everything says , we are heading to 6100, then 5,800, then 5,700 before we start to build the next leg up.
Gold will also fall as my next prediction as inflation will be higher than anticipated. Gold target 3600, but it will push to 4,700 before rolling over.
Target: 6100 SPX