We are now in the center of our current reversal zone for the broad stock market (and other markets), and close to our June 23 "pivot point" - i.e. likely time for the market to turn. The NASDAQ is pushing to a new all-time high today without the S&P 500 and DOW. While the S&P 500 is close to a new all-time high and could achieve this over the next few days, the DOW is well below its all-time high, and its cycle has turned bearish. The DOW is unlikely to make a new high before its medium-term cycle makes a final bottom several weeks (or more) from now. This means we have a strong intermarket bearish divergence signal in the center of a reversal zone. I was tempted to sell short today, but the S&P 500 and NASDAQ were very bullish and closed near the top of their day's ranges (most likely due to Fed Chairman Jerome Powell's "dovish" comments made in a testimony before Congress today). We will watch this market carefully tomorrow. We may enter a short position early in the day, so traders should be alert. We will most likely short the NASDAQ (with an an index fund or ETF tied to this index) as it is the most ripe for a steep correction. We remain on the sidelines for now.
Yesterday silver made a new weekly low, but gold prices held above last week's low giving us a small bullish divergence signal. The U.S. Dollar Index also seems to be peaking now in the center of a reversal zone specifically for currencies (June 18 - 28). This suggest the possibility of more rallying in these metals. Let's hold our long position in gold with a close stop loss on a close below $1750. We are still out of silver.