Guesstimates on August 16, 8:50 am ET

Spiders - September S&P Futures: This market has dropped much more than I expected. However, early this morning it reached the long term trend line I illustrated in yesterday’s post. I think we shall see a strong rally develop from 1390 in the futures and 139.00 in the Spiders. Initial upside target will be 1460 and 146.00. I still think that new bull market highs will be seen later this year.

QQQQ: The Q’s should hold support near 45.50 and then head back to 48.00. Later this year the Q’s will go to new bull market highs.

TLT - September Bonds: I think an extended drop all the way down to 103 has started. The 109-28 level is resistance and the next short term support is at 108-00. TLT shows strong resistance near 87.50 and should soon begin a drop to 80-81.

September 10 Year Notes: The notes have strong resistance at 108-20 and will soon begin a drop to 102 or so.

Euro-US Dollar: I think this market is headed to 126.00 and eventually lower than that. Short term support stands near 133.00..

Dollar-Yen: The yen has developed much more weakness than I expected. At this juncture the downside target is 111.50 which would make this break about as big as the one which ended in May 2006 at the 108.96 level. I do not think the longer term upmove in the yen is over and I expect to see the 130 level late this year or early next.

XLE - OIH - USO – September Crude: It looks like crude oil has started a big move downward. The 66.00 level is the initial target but I think that the market will drop below 50.00 over the next 12 months. Both XLE and OIH are headed much lower. The 57.80 level looks like the ceiling for USO.

GLD - December Gold: I will stick with my 705 upside target for the futures unless gold shows weakness below the 660 level. In any case the next 100 dollar move should be down. I think GLD will drop below 60 on its way to much lower levels. Resistance in GLD is 68.50.

SLV - September Silver: Silver is again trading below 1250 early this morning. A close below there will convince me that a big drop to below 1000 has started. SLV will drop below 100 at the same time.

Google: I think the market will drop to 485 and then start a rally to 600.