According to every market “guru” CNBC can find the world is either ending, or at the very least, wall street is crumbling.  I personally have no idea where the markets are headed. So, where does that leave us in our search for market riches?

We are currently down a good 21% or so from the S&P 500 highs, and out of the past 15 days, we have only closed positive by any meaningful margin 3 times.  This would lead most people to believe that a bounce is imminent.

However, rather than just “assume” we are due for a bounce because of oversold conditions, I like to consult my market models. According to my short term model the next valley should have been put in at $132.07 on the SPY. We can clearly see this was not the case. To better understand this prediction, you should know that this model is normally off on average plus or minus $4.34 when predicting a valley.  At the time of this witting the SPY is currently trading at $124.55 which means this prediction was off more than normal.

With this information, I am currently looking for good bargins to pick up in preparation for the next short term uptrend. Which, according to this model, should take us to around $133-$137 on the SPY.