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  • Stocks, Gold & Dollar Commentary May 21, 2018

    Stocks
    After spiking higher on Monday (almost reaching our upper SPY boundary 274.90 – actual high 274.08), the market closed the week with less than a 1% gain, on the slowest volume in 5 weeks. recording the smallest Weekly range in 4 months, producing a Bearish Weekly Squat, pointing to immediate downside SPY targets 266.62 – 264.48, where heavy downside volume needs to occur for any semblance of a future major top. At this point in time, there is nothing on the immediate horizon, other than a modest 2 – 3% correction, which should be followed by another rally towards the upper end of our boundary. The new Economy sector gave up some ground which was expected. Upside/Downside Volume remains positive. Bearish Momentum divergences can only occur after the next rally. Breadth remains adequate as 4 month highs were recorded. In the event 274.90 is penetrated, look for 279.81 as major Fib resistance.
    Gold
    In what appeared to be total desperation, the banking cartel unloaded 13,500 Comex gold paper contracts in less than 1 minute ($1.75 Billion) on May 15, driving the metal down $25. Spot closed Friday on a small bounce to 1292, holding above its 55 week mvg avg 1277.47. The shares (XAU index) held up fairly well, dropping 2%. Supporting the cartel was the continuing strong Dollar which gained  another 1 1/4% to 7 month highs, crossing above our Weekly 89 line. Spot gold closing over 1322 is bullish. An XAU close over 86.71 for 3 consecutive weeks should see a rapid run to 105.49. 84.84 should provide minor resistance.
    Dollar
    We were wrong on an immediate Dollar (UUP) correction. Instead, on higher interest rates, the UUP closed above the Weekly 89 line (24.38) Two more weeks of consecutive closes over 24.38 turns the Dollar trend up. UUP 25.05 remains long term Fib resistance.

  • Stocks, Gold & Dollar Commentary May 14, 2018

    Stocks
    Stocks ran ahead 4 out of 5 days, tacking on nearly 3%, in lackluster volume, with SPY getting somewhat close to the upper band in our forecasted trading range (274.90). Actual high 273.15. While slight negative readings have started to occur in our Upside/Downside Volume studies, it by no means suggests the market is at a major turning point, other than a steady diet of violent swings, but still within the broad trading range bound by 274.90 – 258.35, for several more weeks. Three Daily closes above 274.90 would increase the top of the range to 279.79. The New Economy sector continues to show leadership, making new highs relative to the Old Economy.
    Bullish momentum registered 12 week highs, which means several more weeks of sideways trading is likely before bearish momentum divergences start to show up. A high day is expected May 17, with a more important high around May 30.
    Gold
    The metal faced 3 major headwinds last week: relentless cartel paper selling, rising interest rates, and a strengthening Dollar, but still managed to close up on the week (1318.70) after selling down to 1303.50. Fib resistance spot 1330 – 1335 (GLD 126.12 – 126.84). While clueless Western Institutions have been suppressing the gold price for the past 10 years, actual gold withdrawals into the Shanghai Gold Exchange now approach 16,000 tonnes since 2008. The shares (XAU Index) outgained the metal slightly tacking on 1.7% for the week, but on weak volume, suggesting more sideways trading is the logical scenario for a few more weeks, before catapulting XAU to 105.49, on the strength of our ADX which has moved into “big-move” territory. Look for 3 consecutive closes over 86.00 to start the move. GLD Fib support 124.38, 124.02.
    Dollar
    Running into our 89 lines proved formidable resistance, and a Dollar correction is likely, with a big Fib support target UUP 23.65, over several weeks.

  • Stocks, Gold & Dollar Commentary May 7, 2018

    Stocks
    Stocks made its low May 3, and promptly sky-rocketed 3% off the low on Jobs Day, led by the New Economy sector, which went to new highs when measured against the Old Economy. While there has been some deterioration in our Upside/Downside Volume studies, the strength in the New Economy means, at this point, there is no clear indication of an impending top of significance. Important Fib resistance SPY 274.90, with maximum resistance 279.79. Expect high day around May 17. The SPY trading range discussed last week 274.90 – 258.35 (actual low 259.05) should remain in effect for the forseeable future.
    Gold
    Spot gold closed Friday 1314, falling $8 on the week, primarily on Dollar strength, which has reached important Fib resistance (see below). We were wrong on the gold rally starting last week, as continued paper selling kept the bulls at bay. But with back-to-back Bullish Squats on GLD, the odds favor a strong bounce into GLD Fib resistance 126.12 – 126.84. (spot 1330-1337). Bullion has closed over its 55 Week mvg avg for 21 consecutive weeks. The shares were quiet but managed to outpace the metal. This coming week we will have reached “big-move” territory on our ADX, thus, getting close to a sharp move up on the XAU. Look for 3 consecutive Weekly closes over 86.03 to spike to Fib resistance 105.49, as the first salvo on a much higher move.
    Dollar
    As suggested last week, the Dollar traded into Fib resistance UUP 24.39 (actual high 24.41). Resistance should be formidable, as it is bumping into both our 89 lines which converge around 24.40! A pull-back to UUP 23.65 over several weeks is possible, and shows good Fib support. A pullback of that magnitude will be supportive of the precious metals group.

  • Stocks, Gold & Dollar Commentary April 30, 2018

    Stocks
    Stocks ended the week fractionally lower, after a mid-week 3% decline into our projected SPY Fib support 260.94. (Actual low 260.85). The market should establish its low around May 1 — and with our Upside/Downside Volume studies holding its bullish posture — we expect a choppy continuation of the rally that started on April 2 to continue in May, with major Fib resistance SPY 274.90. Important Fib support 258.35, with this boundary likely in place for several weeks. No major change in leadership, with a small decline in the New Economy sector vs the Old Economy. And, no heavy institutional liquidation came in during the decline, as Big Block/Volume registered a 3 week low.
    Gold
    Spot gold fell $13, setting a 5 week low, before ending the week at 1322.60. With the Dollar breaking out to a 4 month high, it was easy for the bank cartel to slam gold with an inordinate amount of paper selling. The gold shares which had been out-performing the metal, lost some of its lustre, declining 2.5%. With the XAU continuing to approach “big move” territory, at most, its a matter of a few weeks before the shares break to the upside with 3 Weekly closes over XAU 86.05. The metal, which is punctuated with a series of higher lows, and with a Bullish Weekly Squat formed on GLD, the market should rally from here, with 126.91 as an immediate Fib target, followed by GLD 128.45 (1352 spot). The GLD “life cross”, which crossed over on 2/9, continues to be bullish (122.25 over 121.53).
    Dollar
    As suggested last week, the Dollar broke to the upside, penetrating the near-term target UUP 23.94.and appears headed for strong Fib resistance 24.39. Higher Fib resistance 25.05 (strong).

  • Stocks, Gold & Dollar Commentary April 23 2018

    Stocks
    Stocks managed to eke out a small gain for the week, after penetrating the upper band of our forecasted trading range (SPY 269). Actual high 271.30. A Bearish Weekly Squat formed on the smallest range in 8 weeks, pointing to a modest correction with targets SPY 263.17 – 260.94, over the next several days. An important low is due May 1. Over-all, the market is bullish with our Upside/Downside Volume studies remaining strong. This will need to change for a much deeper correction to reassert itself. The New Economy sector faltered slightly when compared to the Old Economy, and must be watched closely, to see if it can regain leadership during the rally-back in May.
    Gold
    The big takeaway in the precious metals market was the continuing leadership in the gold shares, which recorded a 3 month high when measured against bullion. Spot gold closed 1335.70, down $9. The banking cartel continues to defend the 1360 level with heavy paper selling. With the Weekly XAU approaching “big move” territory, the key level is 86.05 (Weekly 89 line). Three consecutive Weekly closes over 86.05 should take the shares to Fib resistance 105.49. This should coincide with a spot gold Weekly closing over 1360, and breaking the grip of the cartel.
    Dollar
    After trading in a tight 3 month trading range, the Dollar (UUP) appears ready to break to the upside, on the strength of higher interest rates – and the potential of an inverted yield curve -  with the immediate target UUP 23.94. Major Fib support 22.40. Major Fib resistance 25.05.

  • Stocks, Gold & Dollar Commentary April 16, 2018

    Stocks
    For the week, markets rallied 2% despite trade war rumblings and threats (now promises kept) of missiles being launched against Syria. With SPY recording a 15 day high (267.54), it has bumped into serious Fib resistance (267.38) and a significant pull-back is the likeliest scenario, with SPY 258.77 providing good Fib support. Expect a high energy period mid-week when high and low days are due. Therefore, the SPY range should narrow over the next few weeks, bound by 269 – 257. Upside/Downside Volume remains bullish and the New Economy sector recorded 3 week highs vs the Old Economy.
    Gold
    Spot gold spiked to 1365 on Wednesday, only to be met by fierce cartel selling, driving the metal to 1333, followed by a strong comeback, before finally settling 1345 on the week. The clear winners were the shares with XAU, gaining 3.0%. With the Weekly XAU approaching “big-move” territory, 3 consecutive closes over 86.08 should propel the gold shares to much higher levels. Strong Fib resistance 105.49.  To repeat from last week: The metal appears ready for a bonafide breakout. Three weekly closes over 1360 should propel the metal to 1400. Intermediate term we expect to see 1700. With the “life cross” improving on the Weekly GLD, and spot over its 55 week moving average for 18 consecutive weeks, and the public showing no interest in the metal, a big move is slowly brewing. GLD Fib resistance 127.88.
    Dollar
    After trading at the upper-end of a 3 month trading range, the Dollar fell slightly (UUP 23.54). Major Fib support 22.40. Major Fib resistance 25.05.

  • Stocks, Gold & Dollar Commentary April 9, 2018

    Stocks
    At its worst level, stocks fell nearly 3% — had a huge rally mid-week — finally falling Friday for a net loss of 1%. Surprisingly, Upside/Downside Volume gave off bullish readings, and Breadth improved, providing evidence that the market is still not ready to go down “big-time” — despite Trump’s doubling down on $100B in new tariffs on China. It has now been 10 weeks since the correction started, and still remains in the original trading range, bound by SPY 286.63 and 252.92. With the threat of a real trade war heating up, there is the potential for new lows, with maximum Fib support SPY 242.40. However, until our Volume readings turn bearish, there is the likelihood of continued sideways trading interspersed with strong contra-trend rallies. The New Economy sector continued to under-perform so the ingredients for a good top are still in place, except more time is needed.
    Gold
    Huge volatility in the metal, with spot gold trading as high as 1348 on Wednesday, only to be slammed to 1321 overnight Thursday, before Friday’s close 1333.20. The XAU — under the radar — closed at a 7 week high (81.54). The cartel’s clear line of defense is spot 1357 – 1362. With an important high due April 9, and a low soon after, around April 13, the metal appears ready for a bonafide breakout. Three weekly closes over 1360 should propel the metal to 1400. Intermediate term we expect to see 1700. With the “life cross” improving on the Weekly GLD, and spot over its 55 week moving average for 17 consecutive weeks, and the public showing no interest in the metal, a big move is slowly brewing. GLD Fib resistance 127.88.
    Dollar
    The Dollar (UUP) traded to the upper end of an 11 week trading range, ending the week with little change (23.63). Major Fib support 22.40. major Fib resistance 25.05.

  • Stocks, Gold & Dollar Commentary April 2, 2018

    Stocks
    Coming off the large sell-off a week ago, the market never looked back from the opening bell, and after a mid-week hesitation, closed strong, tacking on 2.2%, to close out a holiday shortened week. Going against the grain was the breakdown of the New Economy sector -  led by a wipe-out of the FANG stocks – which retreated from new highs to 5 week lows when measured against the Old Economy. Bullish Momentum divergences are being established, and without a continuous dose of heavy Downside Volume, the market should continue range-bound for at least several more weeks. An intermediate high is due April 9. SPY Fib resistance 270.50, 271.78, 275.58. Strong Fib support basis the Monthly chart 242.40.
    Gold
    The bullion high (1357), came 2 days early, on March 27, with spot retreating to 1321, before settling 1325 to close out the week. The XAU closed slightly lower on the week, (but at a 6 week high 81.12), has now outperformed the metal for 6 weeks running – a bullish sign. It’s been 10 weeks since gold closed 1350, an obvious defense line for the gold cartel. We look for another 2-3 weeks of sideways trading with a high due on April 9, followed by a low around April 13. This will bring our ADX into “big-move” territory, ready to challenge 1360 spot. Three consecutive Weekly closes over 1360 will constitute a decisive break-out for a move to 1400 – then 1700 by late Summer.
    Dollar
    After opening the week lower, and trading near the recent lows, a Bullish Squat formed on the UUP and the market rallied, closing on the highs, UUP 23.61. Major Fib support 22.40. Major Fib resistance 25.05.

  • Stocks, Gold & Dollar Commentary March 26, 2018

    Stocks
    If you’re a bear, the good news: The New Economy sector went from all-time highs a week ago to 3 week lows when measured against the Old Economy, and significant downside volume occurred in 4 out of 5 days, with the heaviest on Thursday registering nearly 10 to 1 on the downside. If you’re a bull: The price decline of 6.5% for the week was simply too great relative to overall volume which declined about 23% from the prior week. Therefore, we did not get Bearish readings in our Upside/Downside Volume studies. Additionally, there was a distinct improvement in Breadth, as new 52 week lows was less than half that occurred the week of Feb 9. More time (possibly several more weeks) are needed for Bearish Upside/Downside Volume readings to occur. The market should now rally to an interim top around April 10, and then more sideways, choppy trading within wide trading ranges.
    Gold
    The market swoon, trade war rumblings, and Dollar weakness gave impetus to a strong $35 gold rally, settling for the week 1347. Significant gold resistance 1401 (GLD 132.96). With the possibility of a market rally and a firming Dollar, a short term high is due March 29 with GLD support 126.18 (1333), 125.67 (1327). Three Weekly closes over 1360 should start a move to GLD  163.31 (1704).The shares (XAU index) have led bullion for 4 weeks, but volume was punk, so in the short term continued sideways is likely.
    Dollar
    For the past several weeks, the Dollar has held in a tight range (UUP 23.08 – 23.77), and will likely remain there until stocks and gold break out of their ranges. Major Fib support 22.40. Major Fib resistance 25.05.

  • Stocks, Gold & Dollar Commentary March 19,2018

    Stocks
    From the rally-back SPY high (280.41) established on 3/13, stocks have given back a mere 2.2% over 5 straight down days. During this period the New Economy sector has led the market, making new all-time highs, despite news of Trump’s tariffs lurking in the background. The continuation of the correction that began 1/29 and ended 2/9 will remain elusive until the market delivers several days of increasing Downside Volume, and under-performance by the New Economy sector. SPY should find good Fib support 269.77. If our studies start to turn bearish, our tentative date for a top remains mid April.
    Gold
    Gold has been in a $57 range for 11 weeks, settling towards the lower end Friday at 1314. Maximum downside is GLD 123.27 (spot 1297). The shares have been following the metal lower, but as a positive, have led bullion for the 2nd week running. With the XAU recording a 10 week low in range, another Bullish Weekly Squat formed, with Bullish Momentum divergences and Bullish Upside/Downside volume. Thus, all signs point to an important low. The “life cross” on the Weekly GLD remains bullish (121.51 – 121.19).
    Dollar
    A minor uptick for the week, but still hovering near 3 year lows. Major Fib support UUP 22.40. Major Fib resistance UUP 25.05.