Today the DOW and S&P 500 are making new April lows (the NASDAQ did this yesterday), so our bullish divergence signal from yesterday has been negated. Both the DOW and S&P 500 are approaching their 45-day moving averages while the NASDAQ seems to be finding support at its 45-day moving average. If these 45-day moving averages can hold the correction, we may look to go long. But if they break, we may put off buying as the market could turn bearish. We will stay on the sidelines of the broad stock market for today.
Gold prices are staying above last week's low, but they're finding resistance at the 15-day moving average (around $2001). They need to clear that and then break above $2047 soon to confirm the current medium-term cycle is bullish. We are holding our long position in gold with a close stop loss based on a close below the 45-day moving average (around $1941 and rising slowly). As long as gold stays above its low from last week ($1970), our bullish divergence signal with silver remains intact.
Silver is also struggling to break above its 15-day moving average (around $25.17) today. As I mentioned yesterday, tomorrow and Friday are strong potential "pivot points" for silver, so a new low over the next few days could be a sub-cycle bottom and good place to go long. We are on the sidelines of silver for now.
Crude oil prices are plummeting today. They are closing well below the 45-day moving average and below a strong support level around $75 (May contract chart). Prices have also now closed the bullish "gap-up" space that we saw on April 3. These are all bearish signals which means that crude could be taking a longer and deeper sub-cycle correction. The next support level is around $70. We need to watch this correction carefully. Any break below the start of the current medium-term cycle ($64.58) would indicate the market is turning bearish. We remain on the sidelines of crude.