Last week, I outlined a roadmap for the S&P 500 through October into the election. I expected the oversold bounce that began on September 22nd to stall heading into the end of September and beginning of October. I continue to expect a choppy, zig-sag pattern to play out into the third week of October coinciding with another option expiration week.

In case you missed it, I recommend taking a look at the daily S&P 500 chart in last week’s note for the path I’m expecting. So far, markets appear to be following that roadmap with the S&P beginning to stall near resistance between its 50-dma (3362) and its highs near 3428 that developed on September 16th.

While I’m still expecting a choppy market for the next 2-3 weeks, I remain bullish on equity markets through year-end well into 2021 based on our 4-year market cycle analysis. While more strategists and commentators turn negative and view the current market as uninvestable until after the election (and possibly later given the prospect for a disputed election), I encourage readers to remain open to the possibility that an investable low develops before the election. As I mentioned above, the week of option expiration between October 16th for equities and October 20th for index options could define the bottom o...

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