Goldman Backtracks

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Strategists led by David Kostin have rolled back their prediction that the S&P 500 would slump to the 2,400 level — over 20% below Friday’s 3,044 close — and now see downside risks capped at 2,750. The U.S. equity benchmark could even rally further to 3,200, they wrote in a May 29 note.

“The powerful rebound means our previous three-month target of 2,400 is unlikely to be realized,” the strategists wrote. “Monetary and fiscal policy support limit likely downside to roughly 10%. Investor positioning has oscillated between neutral and low and is a possible 5% upside catalyst.”
Better late than never but…

The bad news is now that some of the other big dogs may be coming on board and GS is definitely a big dog, expect more tree shaking.

This is a zero-sum game so the late-arriving retail traders who are now wanting to buy into this market because price is above the DVI are likely to be shaken out. That means don’t be surprised if we have minor consolidations or a slight increase in volatility.

Remember, the markets sole job is to move up with the least amount of investors onboard.

In order to move up minus dumb money, there has to be cause for hesitation.

Lets go trade!