3 Month Stock Market Forecast
Stock Market

Stock Market Forecast for Next 3 Months

3 Months Stock Market Outlook

October, November and December traditionally, October aren’t strong months for the stock market. Yet, earnings reports this week plus good job reports are giving a lift to the markets.

While doom and gloom forecasts are easy to give, we might be able to pass by the feared fall downturn. However, the winter isn’t a boom season and there are a host of negative factors that do point to a stock market crash. The government debt deadline in early December is very worrying.

Right now, there’s a struggle between realism and optimism. Today’s uptick in stock prices show optimists are willing to put their money where their mouth is. Step back a bit and look at this house of cards that is the stock market and you’ll realize it is supported by stimulus expectations — speculation.

It’s looking like a stock market correction is about to happen. The September 20/21 sell off will be mild compared to this one.  The timing of this crash is fuzzy depending on political events.  The Democrats are hoping to put off disaster as long as possible. But the media games aren’t working and reality is coming into full view for investors. Some of these investors could panic in October. The optimists call this a buying opportunity.

The 6 month outlook is better. The Democrats will need this much time to get their big stimulus spending event rolling. By April, it will be rolling. By November 2022, the win by the Republicans in the mid terms will change the outlook. The hopes of big, outlandish, unaffordable spending will be dashed.

The big 2023 event ahead is all about reality — that time when Americans come back to earth and realize the idea of $3.5 trillion spending doesn’t solve the problem. That’s when everyone pulls back and the real stock bargains will appear. That’s when you can buy the dip, if your US dollars or Bitcoin are worth anything.

Right now, despite the big increase of M2 money supply, that money isn’t going into the hands of people who buy things. So transaction velocity is slowing. The average American is poorer and is discontinuing their spending. The rich will get hit with a nasty tax increase. Corporate earnings will fall starting in late 2022. P/E ratios will be laughable.

Unfortunately, inflation is still rising, further slowing spending.  Bond yields are rising too and drawing money away from equities. Alternative energy isn’t solving problems. Global warming is suddenly irrelevant as unemployment ticks back up.

Covid isn’t the issue anymore. It’s sky high prices for everything including houses. At the same time, a government shutdown will likely happen in December.

Technical chartmasters have noted the recent changes with the head and shoulders warning.  They don’t measure political and economic events, just pure chart behavior.  While big corrections are short lived, they are powerful.  Experts believe this correction will be devastating because the government can’t spend their way out of it.

Small business isn’t doing well, and gig economy workers will likely be jettisoned quickly when things go sour. October represents that negative beginning.  This 3 month to 5 month downturn will of course lead to another big upward swing as the stimulus money finally flows. Big companies will be able to ride this 3 month dip out. You’ll want to check out the best post pandemic stocks to buy.

Yes, real estate is still a good purchase. Not even China can manufacture land.

Keep in mind that the end of Covid finally celebrated next March, will be an uplifting joyous event. We have vaccines and even new Covid pills that will reduce death significantly. And recent reports suggest our vaccines will last a long time. All very good news. We need more good news!

The Political Underpinnings of the Correction

This 3 month stock market forecast comes with the severe conflict between the Democrats and Republicans on the matter of uncontrolled spending. This is debt that can’t be repaid. As a consumer, this type of behavior is illegal. Conservative Democrats and Republicans both are balking on combining infrastructure and debt emergency spending.

The Democrats want money anyway they can get it to keep the spending theme going. They want to implicate the Republicans who refuse to be pulled into the mess. This struggle is severe and the first big emotional event will happen this month. Anger is high.  Just the fact the Republicans refuse is sufficient warning about 2023.

Quite a few of the Democrats economic tactics are beginning to crack: alternative energy, uncontrolled immigration, deficit spending, high taxation, and Fed raising the interest rates ahead all spells trouble.  This correction is a realization by Americans and the world about the competence of the Democrat party.

Looking at the Russell Index and Small Caps

Small caps aren’t even on the radar as investors look to large stocks on the S&P and Dow Jones indexes. However, as this Yahoo Finance chart reveals, the real value of the stocks is showing through.

Screenshot courtesy of Yahoo Finance

Corona Virus Vaccination News Will Gain Prominence

The Covid pandemic in the US is slowing and that’s a significant factor. The virus will run out of people to infect and new medications are further reducing hospitalizations.

It’s possible that the vaccine success hasn’t been factored into the markets yet. It makes sense, since investors and the public can’t visualize a full reversal of health, cultural and economic trends. Literally everything is about to go into reverse. For you, it’s time to buy the dip and find post pandemic stocks worth buying.  Buy for the 5 year and 10 year forecast.

Covid 19 stocks aren’t gaining much value and revenues aren’t outstanding.  However, stocks like Pfizer are unique in that the company produces a large array of products across the globe and will benefit from a recovering global economy.   The US GDP rises in 2021 as expected, it should boost stock prices dramatically.  Some experts believe the S&P will hit 4300.

Could we see a stock market crash sometime this summer?  In many ways, the economy is a house of cards so concerns of corrections and crashes aren’t ludicrous.  Few people foresaw any of the recent stock market crashes.  Some were calling for a dramatic fall because they are way over-priced based on real earnings.

We’ve had a few volatile correction periods, but as we get closer to full Corona Virus vaccine distribution, you have to think the upward momentum will really pick up by 3 months from now when investors really believe the end of the pandemic is in site.

Record New Highs Called

The stock market for the next 3 months should rise continuously, to new highs. It looks like fundamentals are beginning to drive stock prices higher. Of course, next week’s earnings reports will give a clearer picture. Goldman Sachs earlier predicted an 18% drop in the markets in the next 6 months, but revised it after the S&P surged. Live and learn.

The markets have excelled during the pandemic, not as a response to billionaire wealth, but rather to the hope of the new United States. The Dow, S&P and NASDAQ have grown 15% over the last 3 months. Stock market experts expect stocks prices to plummet but they’ve forecasted this before.

Screenshot courtesy of Longforecast.com

Screenshot courtesy of longforecast.com

5G stocks, computer chips stocks, artificial intelligence, virtual management software, us manufacturers, Tesla, Amazon, and of course the Vaccine stocks are looking good.

Let’s see what forecasts.org believes will be the fate of each index over 2021. In each case, they offer a conservative estimate and believe growth will sag when stimulus ends.  However, the US government will likely provide further stimulus until the economy is back on its feet. That brings a lot of confidence.

Dow Jones forecast 2021. Screenshot courtesy of forecasts.org
S&P forecast 2021. Screenshot courtesy of forecasts.org
NASDAQ forecast 2021. Screenshot courtesy of forecasts.org
Russell 2000 Index forecast 2021. Screenshot courtesy of forecasts.org.

Really Poor Market Forecasting Unrecorded

It’s pretty well known that historic-based forecasting and media-hyped prediction has failed horribly. You’ve seen the technical guy’s tired reports based on historic models, and old “Warren” guys pushing their bias. Are you rich yet?

You’ve realized it’s big corporate money conditioning the market for their advantage. It sounds illegal, but it isn’t in contravention of the financial and stock market laws. They can get away with it.

Unfortunately, the big corporate media who control those channels are not going admit to their poor forecasting performance anytime soon. Go ahead and search for stock forecaster success ratings online. What did you find? Nothing right?

While social inequality protesters riot and spread the virus, fanned and fueled by your favorite media channels, it provides a nice haven for the corporate crowd to hide their actual performance record (and their motives).

We can’t have that. It’s vital to access alternative views of market factors and futures. The next 3 months for the stock markets reflect an end of the virus and a return to February’s hot stock prices. Just get a ruler and draw a line to new stock market record prices.

Next 6 Months: October to March

The stock markets will benefit from the recovery. Globally, issues of supply shortages will raise the value of commodities. Oil and natural gas are already rocketing.

But now that Americans are returning to work and seeing clearly why a pro-American agenda is correct, we’re betting that US companies are going to soar. Check out US tech stocks for instance. NASDAQ is doing so well, yet the media said Silicon Valley would die because of the Republicans.

The 3 month forecast is a troubled on but no worries for 2002. It should be an excellent year for the stock market with prices rising and demand growing.

The key factors in the next 3 months are:

  1. additional government stimulus
  2. rising oil and commodity prices
  3. euphoria over government change begins to weak and the Biden relationship sours
  4. hard working entrepreneurs back to work
  5. work at home still a thing
  6. employment rates keep soaring despite Covid 19
  7. out of control infection rates across the nation create concerns
  8. decreasing Covid 19 death rates and the Merck pill
  9. US China trade war coming
  10. eradication of Covid by mid winter 2022.

China and the Democrats

China has progressed phenomenally by pushing their exports, reducing imports and enforcing a border closure. Something that won’t be done in the US.  Biden pretended to talk tough on China, but the markets are behaving as though no disruption to the status quo is expected. The big corporations including the monopolies all live off of cheap China exports.

The open border, import of drugs, and pressure on the social safety net are big concerns.  The government has hit the debt ceiling hard. They’re even asking to use stimulus money to make debt payments.  The Republicans look like they will deny the Democrat bills and try to minimize government spending while the economy is growing at a rapid rate. Growth in 2022 will be strong before interest rates begin to rise. That’s when the stock markets begin to wobble.

Now one week, later markets are soaring, boosted with optimism about returning to strong US economic growth. The US jobs report and pending home sales numbers aren’t too bad.

See more stock market predictions  and what’s in store for Bitcoin stocks, Oil stocks, Facebook, Tesla, Google, Amazon and Apple.  See the latest Facebook stock price, Google stock price and Tesla stock price quote.  Do you use Google finance or Yahoo finance for fast stock quotes and news?

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