Malefic Planets, Cycle-Waves Portend Big Stock Market Drop Ahead

By: Brad_Gudgeon

May 17 saw one of the largest drops of the stock market this year.  I believe we will see an even larger drop early next week. There are three distinct reasons apart from the daily MACD failing to make a new high along with the SPX. Firstly, we have Mars in Gemini opposing Saturn in Sagittarius on May 29, Memorial Day.  This is a violent combination with each in a mutable sign. Either there is likely to be a terrorist attack (God forbid) or an attack on another nation that they will likely blame the drop on.  I hope I’m wrong about the violence, but I’m positioned short with SPY puts based on other factors as well.

The SPX e-wave count is at a Y wave (as of May 25’s new moon) of an XYZ “B” wave bull flag with usually the larger Z wave down coming into the 8 TD low due May 31.  There is also a larger 16 TD low overdue that last ran 13 TD’s. May 31 is TD 19 balancing out to 32 TD’s.  On top of that, next week could easily fulfill the larger 10 week low due between 44-56 TD’s, and May 31 is TD 45 from the March 27 20-week low.

I give 2 scenarios as to what I believe will be the outcome in the charts below along with a longer term analysis of the GDX.  Overall, I believe the swift drop coming should be no more than the 2-3% range on the SPX. According to my reckoning, by June 9th, June 23rd or July 13th, we should see THE top that leads to at least a 15% correction into August 2017. June 23rd is my favored date, followed by June 9th then July 13.

How the far the fall goes (2344 or 2358), whether it finishes early in the day May 31 or late, whether or not there is a double bottom on June 2 plays into my three scenarios (scenario 3 is a sub scenario of scenario 2 extending into June 23rd from 2358 instead of June 9).
As far as GDX is concerned, we should see a pop up early next week, but with some cooling down of the stock markets could be seeing GDX return back to near the 23.00 area before heading higher into around June 9 and the 24.50/.55 zone.  My analysis suggests a move lower from there into around July 10 to near 20.00.  A nice rally into the end of August may be commensurate with some severe stock market shocks that could involve the Middle East, Iran, China, North Korea or all areas.  After August, I believe we see more sharp pull backs into January 2018 to below 20.00.  August 2018 should see an important peak in the miners before dropping hard into late 2022. 

Some of the precious metals buffs may not want to hear this, but I don’t believe holding gold, silver or mining shares will protect them during the coming severe stock market bear of 2018-2020/21.

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Brad Gudgeon

Editor of The BluStar Market Timer

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The BluStar Market Timer was rated #1 in the world by Timer Trac in 2014, competing with over 1600 market timers. This occurred despite what the author considered a very difficult year for him. Brad Gudgeon, editor and author of the BluStar Market Timer, is a market veteran of over 30 years. The website is www.blustarmarkettimer.info To view the details more clearly, you may visit our free chart look at www.blustarcharts.weebly.com.

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