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The Globe and Mail

Expect a summer rally, but another correction is on the horizon

Bull market for stocks.

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Globe editors have posted this research report with permission of  Phases & Cycles Inc. This should not be construed as an endorsement of the report's recommendations. For more on The Globe's disclaimers please read here. The following text is excerpted from the report:

The markets should have a modest rally over the summer months as the "up" portion of the new cycle takes hold. But the extended nature of the larger advance suggests that a choppy rally will be followed by another correction as the cycle moves to its next maturation date in mid-October. This correction should take the markets back below the June 24 lows.

The recent lows provided a buying opportunity, especially in technically strong stocks that have been subjected to profit-taking. But the markets are unlikely to rally to new bull market highs over the summer. A second correction into the autumn months is needed before sufficient buying power is mobilized to launch what is likely to be the final major advance of this bull market.

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Read the full report here.

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