MARKETS UPDATE (12:30 pm EDT)
The broad stock market's direction is still unclear. The DOW and S&P 500 have not made new lows for the week while the NASDAQ did break below last week's low yesterday so we now have a case of intermarket bullish divergence. The NASDAQ's low is only one day out of our reversal zone so it could reverse here (the DOW and S&P 500 made their lows on June 29 - last Thursday- which was in the center of the reversal zone). The next reversal zone is only one week away. If today's bullish divergence signal is valid, this market could rise into it, but directional momentum in the S&P 500 and NASDAQ is still mixed bullish and bearish so we can't rule out the market falling lower next week. It is best to remain on the sidelines of this indecisive market for now.
In Wednesday's blog on precious metals I wrote:
" If gold can stay above its low from May 9 ($1214), we may have a good bullish divergence signal and buy spot here, but if gold breaks that low (it is close) then both metals are likely turning bearish and will move lower for at least several more weeks (probably longer)."
Today gold is breaking below $1214 so it looks like this market is turning bearish. Silver is also breaking below its important support level of $16.07. We may switch our trading strategy to short selling any short-term bounce until these metals find a new bottom. The next reversal zone for gold and silver is the last week of July. These metals thus have plenty of time to move lower before we can expect a reversal back up. Let's stay on the sidelines for now.
In Wednesday's blog on crude oil I wrote:
" If prices can edge back up tomorrow and Friday and stay below that $47 high, we may get another chance to sell short; otherwise, we will wait for another bottom to buy in another reversal zone for crude coming up in the third and fourth week of this month. Ideally, that could be close to $40 and the bottom of a long-term cycle (very good spot to buy), but if prices stay above $42, it could still be a good buy spot as the new long-term cycle may have started at that $42 low on June 7."
Yesterday crude oil prices rose briefly to $46.53 (Aug. contract chart) before falling back to close the day near $45.
I was not quick enough to short sell that top (we are not day traders). Prices are falling steeply today so unless we see another significant bounce, it looks like we will wait for that bottom to buy in the second half of this month. Still on the sidelines of crude oil.
The broad stock market's direction is still unclear. The DOW and S&P 500 have not made new lows for the week while the NASDAQ did break below last week's low yesterday so we now have a case of intermarket bullish divergence. The NASDAQ's low is only one day out of our reversal zone so it could reverse here (the DOW and S&P 500 made their lows on June 29 - last Thursday- which was in the center of the reversal zone). The next reversal zone is only one week away. If today's bullish divergence signal is valid, this market could rise into it, but directional momentum in the S&P 500 and NASDAQ is still mixed bullish and bearish so we can't rule out the market falling lower next week. It is best to remain on the sidelines of this indecisive market for now.
In Wednesday's blog on precious metals I wrote:
" If gold can stay above its low from May 9 ($1214), we may have a good bullish divergence signal and buy spot here, but if gold breaks that low (it is close) then both metals are likely turning bearish and will move lower for at least several more weeks (probably longer)."
Today gold is breaking below $1214 so it looks like this market is turning bearish. Silver is also breaking below its important support level of $16.07. We may switch our trading strategy to short selling any short-term bounce until these metals find a new bottom. The next reversal zone for gold and silver is the last week of July. These metals thus have plenty of time to move lower before we can expect a reversal back up. Let's stay on the sidelines for now.
In Wednesday's blog on crude oil I wrote:
" If prices can edge back up tomorrow and Friday and stay below that $47 high, we may get another chance to sell short; otherwise, we will wait for another bottom to buy in another reversal zone for crude coming up in the third and fourth week of this month. Ideally, that could be close to $40 and the bottom of a long-term cycle (very good spot to buy), but if prices stay above $42, it could still be a good buy spot as the new long-term cycle may have started at that $42 low on June 7."
Yesterday crude oil prices rose briefly to $46.53 (Aug. contract chart) before falling back to close the day near $45.
I was not quick enough to short sell that top (we are not day traders). Prices are falling steeply today so unless we see another significant bounce, it looks like we will wait for that bottom to buy in the second half of this month. Still on the sidelines of crude oil.
RSS Feed