MARKETS UPDATE (2:00 pm EST)
This week's Fed meeting ended on Wednesday with little fanfare - no rate hike and no press conference with questions for the new Fed Chairman Jerome Powell. A slight change in some wording in the Fed policy statement had some analysts speculating that the FOMC was a bit worried about short-term instability in markets due to Trump administration controversies. Wall Street, however, didn't seem that concerned as it rallied slightly after the 2 PM release of the the Fed's policy statement.
The broad stock market is also rallying today after falling steeply all week - perhaps a relief rally following no major surprises from yesterday's Fed statement. We are not in a reversal zone until later next week so this rally from yesterday's low may not get far before turning down again. Tuesday's bullish divergence signal has been negated as both the S&P 500 and NASDAQ made new weekly lows yesterday (the DOW did this on Tuesday). We are still watching for a low in next week's reversal zone (May 8 - 16) for an opportunity to cover our short position and possibly go long if it looks like a significant cycle bottom. Holding my short position in the broad stock market for now.
Gold and silver also seem to be manifesting relief rallies after strong price plunges on Monday and Tuesday, but directional momentum in both metals has turned nearly 100% bearish so I still think prices could be headed for new lows into next week's reversal zone for precious metals (May 8 - 16 , same as for the broad stock market). If they do this, we may look to buy (especially gold if it completes its medium-term cycle). The U.S. Dollar Index took a brief dip yesterday but still seems quite strong with its directional momentum nearly 100% bullish. This rally in the dollar is what is pushing down gold and silver prices. (Please see my gold and silver update from Monday - April 30).
On the sidelines of gold and silver.
In Tuesday's blog on crude oil I wrote:
"Despite a brief surge to $69.34 (June contract chart) in yesterday's trading, the April 19 high of $69.55 remains the high for the current medium-term cycle so far. I think that high will be exceeded, but first we may see a correction into the $64 - $66 area."
Well, that $69.55 high is being exceeded today, and crude's recent price dip did not get into our target area of $64 - $66 so we did not get an opportunity to buy. It looks like we could see a rally into next week's reversal zone. If it is steep, we may consider short selling near the end of next week. Still on the sidelines of crude oil.
This week's Fed meeting ended on Wednesday with little fanfare - no rate hike and no press conference with questions for the new Fed Chairman Jerome Powell. A slight change in some wording in the Fed policy statement had some analysts speculating that the FOMC was a bit worried about short-term instability in markets due to Trump administration controversies. Wall Street, however, didn't seem that concerned as it rallied slightly after the 2 PM release of the the Fed's policy statement.
The broad stock market is also rallying today after falling steeply all week - perhaps a relief rally following no major surprises from yesterday's Fed statement. We are not in a reversal zone until later next week so this rally from yesterday's low may not get far before turning down again. Tuesday's bullish divergence signal has been negated as both the S&P 500 and NASDAQ made new weekly lows yesterday (the DOW did this on Tuesday). We are still watching for a low in next week's reversal zone (May 8 - 16) for an opportunity to cover our short position and possibly go long if it looks like a significant cycle bottom. Holding my short position in the broad stock market for now.
Gold and silver also seem to be manifesting relief rallies after strong price plunges on Monday and Tuesday, but directional momentum in both metals has turned nearly 100% bearish so I still think prices could be headed for new lows into next week's reversal zone for precious metals (May 8 - 16 , same as for the broad stock market). If they do this, we may look to buy (especially gold if it completes its medium-term cycle). The U.S. Dollar Index took a brief dip yesterday but still seems quite strong with its directional momentum nearly 100% bullish. This rally in the dollar is what is pushing down gold and silver prices. (Please see my gold and silver update from Monday - April 30).
On the sidelines of gold and silver.
In Tuesday's blog on crude oil I wrote:
"Despite a brief surge to $69.34 (June contract chart) in yesterday's trading, the April 19 high of $69.55 remains the high for the current medium-term cycle so far. I think that high will be exceeded, but first we may see a correction into the $64 - $66 area."
Well, that $69.55 high is being exceeded today, and crude's recent price dip did not get into our target area of $64 - $66 so we did not get an opportunity to buy. It looks like we could see a rally into next week's reversal zone. If it is steep, we may consider short selling near the end of next week. Still on the sidelines of crude oil.
RSS Feed