Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
CNBC’s Fast Money had an extended interview with Marc Faber last evening, and this well known strategist is calling for a 10% correction over the intermediate term. However he believes the S&P 500 could make a new yearly high first. He believes that correction is the lever that will bring in the Fed and its QE magic – that is a very different order of events than the market is currently forecasting.
Faber says if investors continue to ‘stick with what’s working’ and also bid up some oversold stocks, the market could rally. “We could go to 1450 or even 1500,” he says. However, he believes any advance will be a false rally. At 1450-1500, he says the S&P will be at the top of the range. Faber’s proprietary research suggests to him “we’re in the late stage of a mature market and not a new bull.” From those levels he sees bears taking the market down. Faber estimates the S&P could trade down about 150 points from where we are now, or about 1250. However, at 1250 he thinks the potential of QE3 then sets a floor.
Full video below – email readers will need to come to site to view:
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