Stock Market Forecast July 2016 through December 2016:Below Average

My forecasting models expect some market weakness for the next few months, but project that the market will do somewhat better in the closing months of 2016.  Overall, the models forecast a gain of just 1.3 percent between now and the end of 2016.  The probability of at least breaking even over the coming half year is about 70%  -- very close to the market's long term average.

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The short term market forecast remains negative.  The model turned negative at the start of June and remains mildly negative.  The model is not likely to issue a buy signal in August either.

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Overall, the U.S. stock market has been behaving fairly close to the models' expectations.  In January the model had projected a 7.3% market gain in te first half of 2016 and the actual market gain was exactly the same 7.3%.  In June the one-month trading model turned negative -- ahead of the brief Brexit market tumble.

On the whole the market seems to be normal, reacting about the same as it usually does to the economic variables that typically foretell market direction. If that continues, we can expect a couple more weak months before prospects improve.