{"id":56845,"date":"2024-08-22T07:43:42","date_gmt":"2024-08-22T07:43:42","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=56845"},"modified":"2024-08-22T07:43:42","modified_gmt":"2024-08-22T07:43:42","slug":"short-medium-and-long-term-outlook","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2024\/08\/22\/short-medium-and-long-term-outlook\/","title":{"rendered":"Short, medium and long-term outlook"},"content":{"rendered":"

We conclude with a summary of our short-, medium-, and long-term outlook. But first, let’s examine today’s market activity.<\/p>\n

Stocks<\/h2>\n

The S&P 500 is edging higher, gaining 0.3% yesterday, while the strengthening Trend Index indicates that more buyers are returning to the market.<\/p>\n

\"S&PThe advance is also broadening, with the S&P 500 equal-weighed index ($IQX) testing resistance at the recent high of 7000. Breakout would offer a target of 7400.<\/p>\n

\"S&P<\/p>\n

Financial Markets<\/h2>\n

The Chicago Fed National Financial Conditions Index declined to -0.52 on August 16, signaling that monetary conditions are again easing.<\/p>\n

\"Chicago<\/p>\n

However, Bitcoin continues to consolidate around $60K, warning that financial market conditions are still unsettled.<\/p>\n

\"Bitcoin<\/p>\n

Treasury Markets<\/h2>\n

Ten-year Treasury yields are headed for a test of support at 3.7% while declining Trend Index peaks below zero warn of growing long-term buying pressure, driving down yields.<\/p>\n

\"10-Year<\/p>\n

Expectations of Fed rate cuts are driving yields lower and weakening the Dollar, which is bullish for gold.<\/p>\n

Dollar & Gold<\/h2>\n

The Dollar Index is testing the band of long-term support between 100 and 101. Declining Trend Index peaks below zero warn of growing long-term selling pressure. A breach of 100 would signal a bear market, with a long-term target of 94.<\/p>\n

\"Dollar<\/p>\n

Gold is retracing to test support between $2,475 and $2,500 per ounce. Rising Trend Index troughs above zero indicate growing long-term buying pressure. Respect of support is likely to confirm our target of $2,600.<\/p>\n

\"Spot<\/p>\n

Silver is expected to test support at $29 per ounce. Respect is likely and would confirm our target of $31.50.<\/p>\n

\"Spot<\/p>\n

Crude Oil<\/h2>\n

Brent crude is testing support between $76 and $77 per barrel. A breach would offer a target of $72 to $73 per barrel, the lows from 2023.<\/p>\n

\"Brent<\/p>\n

Conclusion<\/h2>\n

Our short-, medium-, and long-term outlook:<\/p>\n

Short-term<\/h3>\n

Easy monetary conditions will likely continue until after the November election, with a September Fed rate cut of 0.25% almost certain. The S&P 500 is expected to test resistance at its recent high of 5670. Breakout is likely to offer a target of 6000.<\/p>\n

Falling interest rates and a weakening Dollar are expected to boost demand for gold and silver, with short-term targets of $2,600 and $31.50 per ounce, respectively.<\/p>\n

Medium-term<\/h3>\n

Our 2025 outlook is for weak industrial demand from China and increased push-back against their dumping of excess production in international markets. Resulting low crude oil and base metal prices are expected to ease global inflationary pressures. Central banks are likely to reduce interest rates to cushion the impact of a contraction in economic activity.<\/p>\n

Low long-term yields and a Dollar bear market are expected to be bullish for gold and silver. We expect the S&P 500 to peak at 6000, with stocks growing increasingly bearish as earnings contract and activity declines despite low interest rates.<\/p>\n

Long-term<\/h3>\n

China is expected to suffer from a decade of low growth as it struggles to deal with excessive debt levels and overinvestment in real estate, infrastructure, and industrial capacity. The US and most developed nations also struggle with high debt levels and will endeavor to keep real interest rates near zero. High asset inflation will likely result, causing strong demand for precious metals, real estate, and stocks.<\/p>\n

Acknowledgments<\/h4>\n