I apologize for delaying my post (I promised one over the week-end). Fortunately, markets have been relatively stable so there has been no imminent need for an update. I will try to give a longer-term view of all markets soon.
Yesterday and today all three broad stock market indices were relatively flat and remained below their highs from last week. Wall Street appears to be holding its breath as the chaotic circus of our current election politics plays out on the stage of mainstream and alternative media platforms. This may continue through at least Jan. 20th when a decisive and final transition of power should happen.
As I mentioned last Friday, we move into a new strong reversal zone this week (Jan. 12 - 21). This suggests a significant top could happen this week or next that will be followed by a significant sub-cycle correction. Ideally, we would like to see new highs in one or two of these three indices (DOW, S&P 500, NASDAQ), but not all three, for a case of intermarket bearish divergence this week or early next week. If we get that, we may consider selling short. We're still on the sidelines of this market.
It looks like gold and silver are both completing their current medium-term cycles with a strong correction to their final bottoms, although there's a small chance gold started a new medium-term cycle with it's $1766 low on Nov. 30. We will go with the first scenario, which will put us in the situation of waiting for the final bottoms in both metals. This could be around $1650 - $1750 in gold, and $22 - $25 in silver. If $22 breaks, silver might get down to $20 or even lower. We will stay on the sidelines for now.