Stock Market Sowing the Seeds for the Most Unexpected Bull Run in History

Stock-Markets / Stock Market 2023 Feb 14, 2023 - 02:28 PM GMT

The Santa rally that runs for 7 trading days into the start of each new year expired on the 4th of January and believe it or not technically we actually got a Santa rally, the 7th straight Santa rally in a row.

Of course it was a FAIL in terms of how ones portfolios technically played out but it did happen even if it seemed like Santa had gone missing this year. However the third run to a target S&P 4000 has remained pending given that my expectations have been for the window for a rally into the Middle of January which could stretch to options expiration of 20th of January, remember we have already had 2 breaks above 4000, the last being into the early December moon shot that propelled the S&P to just above my original target of 4,100 that gave way to the current correction ahead of a third run to 4,000.

First a recap of the stock markets big picture - The trend forecast for 2023 that should see the Dow conclude the year significantly higher than it's 30th December close of 33,147, and similar for the other indices.

In terms of my trend forecast the Dow by now should be trading at approx 32,800 vs actual last close of 33,517 for a positive deviation against the trend forecast of +2% So the forecast continues to provide for an accurate road map against which to measure relative strength or weakness.

Despite all of the gloom and doom one is exposed to such as recession, depression, Fed determined to kill inflation with 5%, 6% even 7% rates, earnings contractions, contagion risks, all whilst the Dow is at 33,517 showing a +2% deviation against the trend forecast. Given the weight of bad news why +2% and not -10%? Is it because the Dow is about to do that which no one expects? Which is to TRADE TO NEW ALL TIME HIGHS? And if that is what transpires then what kind of seismic shock would it send to so many who have been caught badly wrong footed as they patiently wait for NEW bear market lows all whilst the Dow stealthily meandered it's way to a NEW ALL TIME HIGH!

Whilst the Dow continues to show positive deviation against my trend forecast then one should take this as a warning to be prepared to expect that which no one expects - NEW ALL TIME HIGHS and thus act accordingly in by not letting oneself get infected by the perma doom merchants with their shrill cries of new lows ahead.

This article is an excerpt from Stock Market Gasping to Reach 4000 Ahead of Earnings Season, Dow New All Time High 2023? that was first made available to patrons who support my work.So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $4 per month. https://www.patreon.com/Nadeem_Walayat. Lock it in now as $4 per month as this soon rises to $5 per month - LAST CHANCE!

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By Nadeem Walayat

http://www.marketoracle.co.uk

Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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