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  • Stocks, Gold & Dollar Commentary May 6, 2018

    Stocks
    A 2% drop over a two day period was promptly reversed on Friday’s bullish jobs report, sending stocks approaching, but falling short of new highs. A negative momentum day was registered on Thursday, after a record-breaking 22 consecutive days of bullish momentum. Along with that, our Upside/Downside Volume studies finally achieved a string of near-term bearish readings, as well as a trend “turndown” on our ADX. Stocks have virtually run out of room on the upside, and should now be followed by a period of weeks of modest, choppy declines and rallies, while the New Economy sector starts to under-perform, ultimately leading to an important high around the end of May.
    Gold
    The metal was rigged with paper selling pressure all week, with spot gold testing 1266, before bouncing Friday on the jobs report, settling 1279. Spot gold strong support 1248. Spot gold print 1325 will put low in. Weekly close over 1360 will start run to 1600.  GLD Fib resistance 124.39. SLV Fib resistance 14.73. GDX Fib resistance 22.50. The shares (XAU) were weaker, losing 5%, settling 68.79, and recording a 15 week low vs the metal. With our Upside/Downside volume studies continuing to show multi-week bullish divergences, any short-term weakness is looked upon as extraordinary buying opportunities. Spot gold 55 week mvg avg 1268.24.
    Dollar
    The greenback was soft, pulling back from an over-bought condition with UUP settling 25.16. UUP Fib support 25.86 – 25.77 (strong).

  • Stocks, Gold & Dollar Commentary April 29, 2019

    Stocks
    The General Market closed Friday on a new high, (fueled by a better than expected GDP report) lead by the strength of the New Economy sector, which closed at new decade highs and shows no inclination to slow down. On a bearish note, trading volume was the slowest in over a year (ex holiday weeks), while complacency levels, once again are approaching historic lows, a prescription for bad things to happen. Stocks have gained an amazing 25.2% since the bear market low on Dec.26. While stocks are likely close to a tradeable high, we see no more than a 3.5% correction at this point. For significant price weakness to set in, and Bearish Momentum divergences to set-up, at least another 20 – 40 days of time needs to pass, which would set up for an important peak towards the end of May. SPY Fib support 284.36 – 283.20.
    Gold
    On Tuesday, gold tested the 55 week mvg avg (1268.04) with low spot touching 1266. By Friday, the spot market rallied to 1289, settling 1286. It’s likely, with our projected low mid to late April for this cycle, gold has seen its low.
    A strong close over 1360 will take the metal to 1600, with the Summer months setting up for an explosive period. The PM’s (gold, silver & shares) have tested and bounced off important support levels, and are ready to move significantly higher. GLD Fib resistance 124.39. SLV Fib resistance 14.73. GDX Fib resistance 22.50.
    Dollar
    On the strength of the strong GDP report, the Dollar broke into new multi-year high ground (UUP 26.35).

  • Stocks, Gold & Dollar Commentary April 22, 2019

    Stocks
    The market attempted to correct twice last week, only to be rescued by the unusual strength in the New Economy sector, which went on to new, decade closing highs. Volume was extremely light in pre-holiday trading. Market Breadth weakened considerably, which should lead to a continuation of the market correction — but no more than 3.5%, at this point in time, before a decent bounce to challenge the highs. SPY Fib support 284.36 – 282.13.
    Gold
    The metal was weak, falling $15, to settle at 1275.50, after testing the bottom of our projected support level 1271. Actual spot low 1270.50. Mid to late April is when a low should be seen in the PM’s, followed by a breakout around mid May, although there is a wide variance, due to constant rigging in the paper markets. However, Mother Nature will not be denied. This Summer should see explosive moves in the PM’s. A strong close in spot gold over 1360 will project to 1600. GDX Fib support 21.00. SLV Fib support 13.90. Look for strong close over 14.40 to break out of top of giant falling wedge formation, to run to 14.74 and 15.69 Fib resistance. Spot gold 55 week mvg avg 1267.73.
    Dollar
    Contributing to gold weakness was considerable strength in the greenback, which surprised us and rallied to 2 year highs (UUP 26.14). UUP 26.82 represent a milestone and 10 year highs.

  • Stocks, Gold & Dollar Commentary April 15, 2019

    Stocks
    Just when it appeared stocks were to finally undergo an over-bought selloff of some significance — in the wee hours Friday morning — Chevron decided it was finally ready to go shale big-time, and offered $33 billion for Anadarko, sparking another flight of madness, as stocks gapped higher, led by the New Economy sector, which recorded a decade closing high. The gain, however, came to only a half percent (from the previous Friday), bringing the 15 week run-up to 23%. With a 7 month low in Weekly Range, and the 2nd lightest volume in 6 months, a Bearish Weekly Squat was recorded. With technicals bearish and volume extremely light, (remember late September) stocks are vulnerable to any drop-off in economic expectations, which will be coming out in droves the next two weeks. The initial decline should not exceed 3.5%, followed by a good bounce, with SPY Fib support 281.99. SPY Fib resistance 291.
    Gold
    Gold had an erratic week, tacking on $20 by mid-week (1310.50) then falling back to settle 1290, slightly down for the week. The shares (XAU) fell 1.4%. Spot support for the metal 1281 – 1271, with a break-out coming around mid May on a strong close over 1360 spot. The shares need a monthly close over 78.05 to run to 3 digits. SLV support 13.90. A giant Bullish falling wedge formation is forming in SLV. Look for a strong Daily close over 14.40, to break out of the top of the wedge, for a move to 14.74 and 15.69 Fib resistance.
    Dollar
    The greenback was down slightly all week, registering a 3 week closing low (UUP 25.96). A strong close under UUP 25.73 could get ugly, as it would appear ready to violate a H&S bottom formation, targeting UUP 25.38.

  • Stocks, Gold & Dollar Commentary April 8, 2019

    Stocks
    In an amazing 14 week bull run, stocks have gained 22.5%, but still within the bounds of the 24% rally after the 2007 – 2009 crash. Seven straight up-days, powered Friday by a fake news Jobs Report (196,000 job gains while full time positions plunged 190,000???) have taken SPY (288.57) somewhat close to exceeding the neckline limit (290.61) basis the Daily chart. To put an end to the rally, look for a SPY close under 286.42 on Tuesday, April 9. Failing that, expect more upside after an over-bought relatively minor setback. We had expected the New Economy sector to seriously falter — which was the remaining piece of the puzzle — to indicate an impending top. Unfortunately, this did not happen, and is now less than 1% from new all time highs. SPY Fib support 279.28. SPY Fib resistance 289.41.
    Gold
    After an early bounce to 1297, spot gold retreated in choppy trading, making a double bottom 1280.50 on April 4 (matching low of March 7), before settling 1291.40. Expect important low mid April followed by mid May breakout. Spot support 1281 – 1271. GLD Fib resistance 125.89. In the meantime, the gold shares re-asserted leadership of the group with an 8 month high vs the metal. Our Upside/Downside volume studies remain extremely bullish for the shares and should lead the group higher, once the metal pushes through major resistance (Monthly close spot over 1360). SLV needs strong close over 14.36 to turn Daily trend bullish. SLV Fib resistance 14.74. XAU needs Monthly close over 78.05 to seek 3 digit levels.
    Dollar
    The greenback was little changed on the week after challenging 6 month highs UUP 26.12. (Actual high 26.10. A strong close under 25.72 turns our 89 line trendlines lower, and bear phase for the Dollar.

  • Stocks, Gold & Dollar Commentary April 1, 2019

    Stocks
    Stocks closed out the week on an up-note, after an early, relatively minor decline of 2.7%, not quite reaching SPY support (276.90). Actual low 277.64. Against the back-drop of an about-face by the Fed — halting rate increases this year — traders are emboldened to push stocks ever higher, despite weak economic news. With four consecutive weeks of shrinking ranges, an unsatisfied Bearish Weekly Squat, and the slowing of the New Economy sector, stocks are ready to undergo a decent correction — after early week strength. High day April 2/3. Strong bounces can be expected off 274.80, with 259.83 strong Fib support. SPY Fib resistance 283.57.
    Gold
    The metal had a rocky week, first showing strength, trading into spot resistance 1324, then declining steadily to 1286 (GLD 121.90), before settling 1292.30. This is in keeping with our forecast for a long period of consolidation, prior to a mid May breakout, and the continuation of the bull market. For the second consecutive month, the gold shares were on the cusp of a significant breakout with a Monthly close over XAU 78.45, only to be thwarted on the last week of the month (closing 76.36 from 3/27 high 79.89). The shares ended down around 1%, but still showed relative strength compared to bullion. Spot gold strong support 1281 – 1271. GLD Fib resistance 125.89. GLD Fib support 119.62.
    SLV Fib resistance 14.74, SLV Fib support 13.90. Spot gold 55 week mvg avg 1266.72.
    Dollar
    The greenback was strong, (UUP 26.03) gaining 1%, and refusing to close under our 89 line trendlines that are merging (25.71). A test of 6 month high is likely (UUP 26.12).

  • Stocks, Gold & Dollar Commentary March 25, 2019

    Stocks
    Stocks took a drubbing Friday — yet fell less than 1% for the week — after spiking to new recovery highs, (SPY 287.44) on bad economic news out of Germany. The result: A collapse in bond yields, which saw the 10-year Treasury yield trading below the 3-month yield. This inverted yield curve has preceded recession on seven out of seven occasions since 1969. With the New Economy sector closing higher on the week — and registering 7 month highs vs the Old Economy – no immediate collapse of stock prices is in sight, just yet. A relatively minor decline from these levels should find Fib support SPY 276.90 – 274.80, followed by a bounce into early April, which should put in the final high, provided the New Economy starts to show weakness, which is way over-due. Technically, with the strongest volume in 9 weeks, a Bearish Weekly Squat formed and will project lower levels.
    Gold
    Gold continues to chop around, ranging from a spot low 1298 early in the week, followed by a rally to 1320 resistance, where cartel paper selling drove spot lower, to 1302.50, before bouncing to settle 1313 on Friday. Spot gold strong support 1281 – 1271. The PM’s remain on track for a break-out around mid May, with a spot gold strong close over 1360. GLD Fib support 119.62, GLD Fib resistance 123.99. SLV Fib support 13.90. SLV Fib resistance 14.83. The shares (XAU) tacked in 1.7%, after trading down 1%, and continue to lead the metal. To signify the bullish break-out for the shares is underway, look for an XAU Monthly close over 78.45.
    Dollar
    After threatening to break under our 89 line trendlines mid-week, the Dollar held UUP 25.57 and bounced to close  unchanged (25.80). A strong close under UUP 25.57 will start a bear phase.

  • Stocks, Gold & Dollar Commentary March 18, 2019

    Stocks
    From the high the previous week (SPY 281.87), stocks added another fractional gain (282.38), to set new recovery highs, breaking through Fib resistance, to extend the gains to 20%, in a stunning 10 week rally that began December 26. In no sign of a let-up, stocks were led higher by the New Economy sector which recorded a 6 month high vs the Old Economy. However, while stocks were hitting new recovery highs, in a troubling sign for the economy, the DJ Transportation Index, was going through a near record 11 consecutive losses, the longest in 47 years. With a high day projected for March 15/18, another mild sell-off is likely with near term targets SPY 275.66 – 273.97, followed by another rally to challenge the highs. As long as the New Economy sector is out-performing, we expect only relatively modest declines for the market, despite our Upside/Downside Volume and Momentum studies remaining bearish. Taking another look at the Weekly chart, you can make the case that the 10 week rally, brought stocks to the neckline, leaving little room for further gains, in an enormous H&S top formation.
    Gold
    The metal continues to trade in choppy fashion, getting slammed early in the week — finding support spot 1290 — and rallying to close out the week 1302. More sideways trading is likely for a few more weeks, with rallies aborted 1320 – 1330 and strong support spot 1281 – 1271. A strong Weekly close over 1360 (mid May) will indicate the bull move has begun with 1400, and higher, in sight. GLD Fib support 119.62. GLD Fib resistance 123.99. SLV Fib support 13.90. SLV Fib resistance 14.83. The gold shares closed flat, after trading lower, but continued to show relative out-performance vs the metal. Interest has returned to the sector with a 3 month high in volume. GDX Fib resistance 23.21. Look for Monthly close over XAU  78.45 to turn trend bullish.
    Dollar
    The greenback fell 1%, (UUP 25.80) after challenging recent high (UUP 26.12) and appear ready to break below 25.57, and close under our 89 line trendlines.

  • Stocks, Gold & Dollar Commentary March 11, 2019

    Stocks
    Stocks finally had a bit of comeuppance, — falling in line with our Bearish Squats — suffering the deepest drop (3.1%) since the rally started on December 26. A last hour bounce limited the damage to 2.0%. The sell-off was accelerated by a bearish Jobs Report, highlighting the slowdown in the economy, with only 20,000 new jobs created. SPY broke through our downside target 274.62, spiking 200 points lower, before finding a good low (272.46). We expect a high day March 15/18, with strong Fib resistance 278.91. Throughout the sell-off, the New Economy stocks continued to lead the market. We expect this sector to weaken as the bounce peaks out. SPY Fib support 270.84 – 269.60.
    Gold
    The PM’s were under pressure most of the week, with spot gold trading down to 1280.90 on Thursday, $65 off the 1346 high on February 20. The weak Jobs Report sparked a rally, (against the sure-sign of stagflation, with wages growing 3.4%, the fastest spurt in 10 years within a slowing economy) and spot gold rallying to 1301. GLD Fib support (121.49) held, closing 122.84. SLV Fib support (14.17) held, closing 14.41. More choppy, sideways trading for several more weeks is likely, with a challenge, and break-out to new highs end of April – early May. The gold shares (XAU) gained 2.6% after early weakness, and were even higher against a strong Dollar. Spot gold 55 week mvg avg 1264.71. Monthly close over XAU 78.45 turns Monthly trend bullish.
    Dollar
    Holding our 89 line trendlines, the Dollar (UUP) rallied to challenge the recent highs (UUP 26.12) stopping 26.07, before settling 25.99. Look for double-top and break below 25.57 to turn trends lower, and bear trend to begin as gold breaks above 1400.

  • Stocks, Gold & Dollar Commentary March 4, 2019

    Stocks
    Stocks ended the week with small gains led by the New Economy sector, on the lightest volume in 5 months. The market has rallied 19% for 9 consecutive weeks, even against two weeks in a row of Bearish Weekly Squats that should have, but failed to produce a significant correction. The current rally now just about equals the 19% rally from March 89 to August 89 that lasted nearly 5 months. At least in the short term, the Powell Put has done its work and continues to levitate stock prices. But, let’s remember the Bernanke Put never prevented the Great Recession. However, Mother Nature will not eventually be denied, with a big sell-off just around the corner. Joining our bearish Upside/Downside volume studies, are quadruple Bearish Momentum divergences, a lack of new highs in Market Leadership, and a sharp deterioration in Market Breadth. Look for a pull-back to SPY 274.62, followed by a good bounce, then a move down to SPY 268.32 where the battle for the continuation of the bear will be fought. SPY close under 266 will set up for eventual new lows.
    Gold
    The Precious Metals consolidation we spoke about has arrived, with spot gold declining $56 from 1346 on February 20 to 1290 on Friday. Markets generally are sitting in a broad area of support, and good bounces can be expected, but several weeks of sideways trading is needed, before the bull can reassert itself. Look for base-building over the next 8 -10 weeks, readying for a multi-week breakout to begin around end of April which will take gold through 1400. GLD Fib support 121.49 – 119.62 (strong). SLV Fib support 14.17. GDX Fib support 21.26. Monthly close over XAU 78.45 will turn Monthly trend bullish.
    Dollar
    A strong Friday bounce brought the greenback positive for the week (UUP 25.74). Look for a strong close under UUP 25.57 to turn our 89 period trends lower, and a bear trend to begin.