MARKETS UPDATE (11:15 pm EDT)
The broad stock market is rallying (so far) this week but not that strongly. It is still unclear whether or not this market is going to make a medium-term cycle bottom into next week's strong reversal zone. If it does, we will look to buy. But if this rally continues into next week and the DOW stays below 18,450, we may consider a short position to ride a strong reversal down into that cycle bottom which could possibly be in late November. Because the U.S. presidential candidates both continue to have strong support (mainstream media polls are favoring Hillary, but many internet polls and alternative news sources claim that Trump is leading), equity markets are nervous and indecisive. Perhaps tonight's final presidential debate will determine a decisive lead. Or maybe not. Still on the sidelines of the broad stock market.
It doesn't look like gold or silver made a definitive bottom in last week's reversal zone but that could still happen as we approach next week's reversal. Today gold made a new weekly high while silver did not which could be a case of intermarket bearish divergence and supports the idea of a downward move into next week. If instead both metals break higher over the next several days with gold staying under $1,300 and silver under $19, we may consider selling short. It is a little unclear how these prices are moving right now so it is best to remain on the sidelines for now.
We took good profits in our crude oil long positions early Monday with the idea that prices could move lower, but crude jumped up today and nearly touched the recent high of Oct. 10 ($51.60 - Nov. contract chart) but did not exceed it. This suggests that the high of Oct. 10 may not be the current subcycle peak and that we could instead see it in next week's reversal zone. Crude could easily make a new high then, and if it does we will consider selling it short. On the sidelines of crude oil.
The broad stock market is rallying (so far) this week but not that strongly. It is still unclear whether or not this market is going to make a medium-term cycle bottom into next week's strong reversal zone. If it does, we will look to buy. But if this rally continues into next week and the DOW stays below 18,450, we may consider a short position to ride a strong reversal down into that cycle bottom which could possibly be in late November. Because the U.S. presidential candidates both continue to have strong support (mainstream media polls are favoring Hillary, but many internet polls and alternative news sources claim that Trump is leading), equity markets are nervous and indecisive. Perhaps tonight's final presidential debate will determine a decisive lead. Or maybe not. Still on the sidelines of the broad stock market.
It doesn't look like gold or silver made a definitive bottom in last week's reversal zone but that could still happen as we approach next week's reversal. Today gold made a new weekly high while silver did not which could be a case of intermarket bearish divergence and supports the idea of a downward move into next week. If instead both metals break higher over the next several days with gold staying under $1,300 and silver under $19, we may consider selling short. It is a little unclear how these prices are moving right now so it is best to remain on the sidelines for now.
We took good profits in our crude oil long positions early Monday with the idea that prices could move lower, but crude jumped up today and nearly touched the recent high of Oct. 10 ($51.60 - Nov. contract chart) but did not exceed it. This suggests that the high of Oct. 10 may not be the current subcycle peak and that we could instead see it in next week's reversal zone. Crude could easily make a new high then, and if it does we will consider selling it short. On the sidelines of crude oil.
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