(Kitco News) - The S&P 500, down 15 percent over 2022, will "easily" reach the "3,300 level" in 2023, said Gareth Soloway, Chief Market Strategist at IntheMoneyStocks.com, who uses technical analysis to forecast market movements. The S&P 500 is currently trading around 4,000.
"It makes full sense that we will at least go down there [to 3,300]," he said. "That's the best-case scenario, per the charts… [but] we could be retracing, in 2023, all the way down to about 3,000."
Soloway's track record of price predictions has been historically accurate. He called for Bitcoin to reach a high of $69K in November 2021, which it did. He also said, in October of 2021, that gold would perform better than Bitcoin in 2022, a forecast which turned out to be correct.
Soloway joined Kitco's Anchor and Producer David Lin for his Outlook for 2023, live on December 9th, 2022.
Macroeconomic Outlook
The Federal Reserve continues to raise interest rates to quell inflation, which reached a peak of 9.1 percent in 2022. Soloway said that in 2023, inflation will remain high.
"I do think inflation will remain elevated," he said. "Elevated means 3 to 4 percent, and maybe 5 percent… Inflation is going to stay north of 3 percent for at least two years."
He explained that "wage inflation is going to be sticky," and that since wages have been rising, businesses will raise prices to offset the cost of higher wages. However, he added that the rate of inflation would trend downwards.
"Prices at the grocery store are still going to be going up over time, just not as quickly," he said. "It's going to hurt the economy. There's no doubt about it that investors in retail, and Americans in general, are going to feel the crunch in 2023.
In general, 2023 looks dire, according to Soloway, who is predicting high inflation, high interest rates, and a weak economy.
"We [will] have inflation, and then the Fed is going to push us into a recession that they can't bail us out of," he said.
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Investing in Bear Markets
Soloway, who has previously stated that stocks are in a bear market and will remain so for "at least" 10 to 15 years, nevertheless suggested that there are opportunities to make money in bear markets.
"There are places to go [in 2023]," he said. "There is gold. Gold is a great performing asset."
He also suggested that bear markets provide ample opportunities for swing traders.
"Long-term investors have had their field day since the Fed began bailing the markets out," he said. "It is now becoming more of a traders' market, where you buy, but then you can't just tuck it away for twenty years. You want to take the profits and run, and buy in the next dip."
To find out Soloway's forecast for the best asset of 2023, watch the video above.
Follow David Lin on Twitter: @davidlin_TV
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