2020 Market Wrap And 2021 Forecast: A Dimmer Sun?
Candy Matheson | Jan 03, 2021 11:59PM ET
Perhaps the most valuable commodity this year will be Vitamin D, thanks to proposal to "dim the sun" and his support for large-scale, endless lockdowns.
My Annual 2020 Market Wrap-Up and 2021 Market Forecast is extremely short this year. We live in an upside-down world, propped up by central banks and government stimulus...likely to continue this year, thanks to the effects of the COVID-19 global pandemic.
The S&P 500 Index (SPX) gained a total of 1,568.34 points from the low to the high of 2020, and the Balance of Power (BOP) is still firmly in the hands of Buyers, as shown on the following monthly chart.
However, the BOP for December is a fraction below November's, so the buying was slightly more subdued last month and may portend a slower pace in the coming months.
The next major resistance is represented by the 1.382% External Fibonacci level at 3852.55. Major support lies below at the "Big Round Number" of 3600.
Barring another retest of 3600, as we saw during three weeks of November, I'd expect the buying to continue up to 3850.57, or higher, in the coming weeks/months.
However, stocks may be getting overvalued, as shown on the following ZeroHedge chart. Perhaps 2021 may usher in more stock splits...or a 10-20% correction.
We'll see what happens...but, keep an eye on the rate of buying/selling, as represented by the BOP indicator.
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