Markets could trade to 1690 - 1800

This bear run is not over. There is more to be gotten on the downside. If we must put forth a target to the market’ downside we can suggest accepting Goldman Sachs' latest estimate for earnings by the S&P listed companies of $110-$115 this year. If we apply a still higher-than average P/E of 15 compared to the present level, that give us a target to the downside of 1690; a 16 P/E gives us a target of 1800 and in the broad scheme of things those are not illogical targets to the downside.

We shall strongly urge those who are still aggressively long of equities to become less so; we shall urge those who are upon the sidelines and are “punters” rather than long term investors to err obviously on the short side and we shall urge long term investors who’ve been fortunate enough to have gone to the sidelines to do what they can and what they must to convince themselves that things are not yet “cheap” enough to warrant even nibbling at equities. Patience and discretion shall be… as they always are… the far better parts of investment valor.

via www.zerohedge.com/news/2016-01-26/why-futures-soared-overnight