Our broad stock market short sell is doing well so far this week. The S&P 500 has today fallen down to our minimal target area around 2050. We should be looking for a bottom and a reversal any time now, although it is possible for the correction to continue lower into next week towards 2000 or even 1960. Conservative traders could take partial (or full) profits now as our first target has been achieved. I am going to wait for a stronger upward momentum signal, however, before covering my short position as I think this index can still hit one of these lower targets. Holding my short position for now.
Gold and silver prices rallied very weakly on Monday but then continued their downward plunge and today both metals made new weekly lows. This market has not yet given us a rally to sell short. These metals could simply be "crashing" into their cycle bottoms, but a normal cycle structure would still suggest a brief rally now before a final plunge to a cycle bottom in the next three or four weeks. There are some short-term signals in both gold and silver charts today and tomorrow that suggest a reversal so we will wait for that. If prices continue to plunge into next week, we will start looking for a spot to go long as we are expecting the cycle bottoms for these metals in late November or early December. Still on the sidelines of gold and silver.
The U.S. Dollar Index, encouraged by this month's positive jobs data, surged close to the 100 mark last week. It seems to be taking a corrective breather this week, however, and may back down a bit more before attempting to break through that 100 level. If it does go lower it could drive the short rally in gold and silver that we are hoping to see.
Like gold and silver, crude oil rallied weakly on Monday and did not give us a chance to sell short before falling again. Crude prices have now broken below their Oct. 27 low of $42.28 which means this market is probably going a lot lower over the next four to twelve weeks. We will try to look for a spot to sell short now on any rally that stays under $44. On the sidelines of crude for now.