US Equities

It is for the nth number of time I am writing that S&P 500 may see a massive correction. Correction has eluded me for almost last 1 year. But since the basic premises have not changed and the index is still trading at the upper end of the channel correction is inevitable.  The only other scenario is that market breaks above this channel and moves up 15% - 25% in a very short span of time. I don’t see this happening hence I will stick to my basic premise that we will a significant correction in S&P50 in 2015. Looking at the extreme bullish sentiments in the market I think we are just living on borrowed time. 

Commodities.

Crude has completed almost 61.8% retracement and may found support at 63 USD levels. A bounce back from here looks imminent and may take crude up to 72 -  73 levels before  it starts another down move. Crude may eventually fall to 52 levels.

Gold and silver are both looking good after breaking out from the short term downtrend. As I mentioned in my previous blog if Gold closes above 1220 and silver closes above 19 USD we may see a long term reversal in precious metals. 

Equities:- Review

In my previous call on Shangahi Composite written on 18^th September 2014, I wrote, “Shangahi Composite stayed at those levels for one full year and it never went below 1975 levels. After an enormous consolidation at those levels Shangahi Composite has broken out of a long term downtrend.”

In less than two and half months Shangahi Composite has moved to 2938 levels up almost 27% form those levels.  Short term target for Shangahi is at around 3200 levels.

I think three Asian markets (Japan, China and India) have entered in a long term bull market and will see swift gains in next 3 – 5 years.