The DOW rallied higher this morning and made a new all-time high (42,420), but then fell sharply. The S&P 500 did not make a new all-time high and closed the day with a loss, and the NASDAQ (still well below its all-time high) is closing today with an even heavier loss. We are therefore starting the week with a strong bearish divergence signal inside our new reversal zone (Aug. 23 - Sept. 6). I am still holding my short position in the DOW.
Silver made a new weekly high today as it tested resistance near $30, but gold stayed below last week's high, so we also have another bearish divergence signal between these two metals (until gold pushes above $2530). I am staying short in silver for now and staying on the sidelines of gold.
Crude oil prices surged up today (to $77.60 - Oct. contract chart), but we are now in a strong reversal zone where a top could form and turn prices back down. Crude needs to close above its Aug. 12 high ($80.16) before we can consider the current medium-term cycle to be bullish. Until that happens, it is bearish. We are staying out of the crude oil market for now.
The U.S. Dollar Index edged a bit lower today as it tested and challenged its Dec. 2023 deep low at 100.62. We are inside our new reversal zone, so a bottom and bounce back up in the greenback could be imminent.