Market Timing Brief™: Not a Trouncing

Posted on April 17, 2012 by David Durand

As I Tweeted near the close on Friday, several markets showing greater technical damage are biotech (BRK) and drugs (DRG).   The SP500 Index dropped below the 50 day moving average.  I said: SP500 Index is closing above the low for yesterday but below 50 day moving average. Mixed picture, but not a trouncing. SPX SPY 

In fact, the SP500 is just barely below the 2011 high of 1370.58 on the close of get this – 1370.25.  Think the market responds to technical signals?  Commodities continue to weaken.  Copper is still making lower lows.  This would suggest that the economy is slowly weakening worldwide,and the markets know it.

Continue to follow the reactions to earnings.  The reaction to the bank earnings was admittedly a bad one.  The reaction to Alcoa was very positive.  And yet, the banks (BKX) did not break their 50 day moving average on the close despite the big downdraft on Friday.  China (FXI) was down a miniscule 0.08% following the “bad news” Friday that Chinese growth has moved down to 8.0% from 9.0% over the past few months.  The VIX did not make a new high.  Small caps should have broken down much more but did not as I also tweeted:

That means the sell-off need not find its next leg down immediately at least.  I favor a move back up at least to a slightly lower high for the SP500 Index followed by a potential second down leg.  Sentiment is getting more Bearish which of course is potentially Bullish although there is room for one more move down in sentiment before it starts to become extreme.  So yes, the Bears have their arguments, but the Bulls have a bit of an edge still.

If you have not seen them, have a look at the charts from this week as well.  They are listed on my “feed page” here:

Market Timing Chart Links Here

Enjoy your week!

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

Since then, the markets have indeed rallied.  There may not be much more upside until the next leg down resumes, but the market has surprised the Bears and has gone to Bullish extremes repeatedly.  The above is the text from the 4-15-2012  “Weekly Wall Street Sun and Storm Report™.  To see the current issue and this week’s ratings of all 35 markets I follow and receive the newsletter every weekend, subscribe here: 

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By the way, if you “liked” this post, please “Like” it below at the “Share” arrow below and/or re-Tweet it.

Enjoy your week!

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

 

Copyright © 2012  By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in copper, investment, investor sentiment, Market timing, S&P 500 Index, trading, volatility index | Tagged , , , , , , | Leave a comment

Market Timing Brief™: The Answer Is?

Posted on April 10, 2012 by David Durand

The market is acting as if things have changed.  The market is saying that we are in a recovery and that the risk of financial oblivion is in the past now.  It is claiming that the banks are safe again.  Gold is less needed than before, the market is saying by pummeling the gold and the metal stocks.  Is it over the longer term?  It would seem not, given the fact that the Euro solution was to print massive amounts of Euros to save the Euro.  So be on alert for a market timing reversal in gold, other metals, and metal stocks.  It may not come for weeks or months, but unless the central banks change the game, it will come.  Just be sure to demand real strength prior to making those purchases.  Corrections often go deeper than we think possible.

The other weak market is Treasuries that have declared a down trend.  If the stock markets correct, will Treasuries benefit this time?  Or is the Treasury sell-off wagging the dog (the stock markets)?  (added 4-10-2012: apparently yes as we saw yesterday!)

Finally, small cap stocks and foreign markets are also pointing down at the moment. (added 4-10-2012: yes, kept falling yesterday)

Even the stronger markets are already showing signs of topping on a market timing basis.  My take is the same as last week.  The market is ready to pull back on less than spectacular earnings and/or forward expectations.  But is it true that the economy actually still slowing after GDP peaked in Dec. 2010?  Earnings season begins this week, so we’ll finally get the answer.

Have a look at the charts from this week as well. They are listed on my “feed page” here:

Market Timing Chart Links Here

Enjoy your week!

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

This is the text from the 4-8-2012  “Weekly Wall Street Sun and Storm Report™.  To see the current issue and this week’s ratings of all 35 markets I follow and receive the newsletter every weekend, subscribe here: 

www.sunandstorminvesting.com/subscribe-to-sp500tracker-newsletter-and-tips.html

By the way, if you “liked” this post, please “Like” it below at the “Share” arrow below and/or re-Tweet it.

Enjoy your week!

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

 

Copyright © 2012  By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, investment, Market timing, small cap stocks, trading | Tagged , , , | Leave a comment

Market Timing Brief™: Waiting for Earnings

Posted on April 2, 2012 by David Durand

Remember that my role is to warn you of opportunities as well as dangers in the market.  One possible opportunity, although it has been shaky lately is the mining sector.  You see, some gurus think that safety is out of fashion, so gold will now do poorly.  Of course the Fed critics say that as long as the Fed keeps the money presses operating, gold can certainly hold its own and should move higher over time.  I favor the latter but believe you have to prepare for the possibility that gold could collapse as it did when the Fed began tightening due to the inflation of the late 70’s and early ‘80s.  While gold, silver, and the miners likely have at least one last big move ahead of them, metal Bears would point out the negative long term signals in gold and gold miners.

The VIX has yet to break out to the downside or the upside.  So the SP500 Index continues to bump up against resistance appearing reluctant to sell off.  Watch as earnings season starts.  If disappointments are taken in stride, that would be positive.  If there are small misses or statements concerning future earnings that are mediocre, and the market responds badly, we are in for a correction in the stock market indices.

Munis may be a good buy here for three reasons: 1. The end of the Bush tax cuts will cause a lot of money to pile into munis if it happens.  2. There has been a bit of a pullback, so there is some room for a bounce. 3. If we are in for a stock market correction, Treasuries and munis will rally together.  I bought some munis on Friday.

Enjoy your week! 

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

You can get the whole current issue by signing up here at no charge: http://www.sunandstorminvesting.com/subscribe-to-sp50tracker-newsletter-and-tips.html

By the way, if you “liked” this post, please “Like” it below at the “Share” arrow below and/or re-Tweet it.

Enjoy your week! 

More at: http://www.SunAndStormInvesting.com/

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

 

Copyright © 2012  By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, inflation, investment, Market timing, mining stocks, municipal bonds, S&P 500 Index, silver, trading, volatility index | Leave a comment

Market Timing Brief: Pausing or Teetering?

Posted on March 27, 2012 by David Durand

3-25-2012

The volatility index (VIX) is now above the 2011 low and has been consolidating, NOT blasting off to the upside.  I believe breaking the 2011 low will indicate the next big rally if that happens.  Moving above the Feb. low will indicate a deeper correction for the SP500 Index and other stock markets for that matter.

On the positive side, the small caps are bouncing from support.  On the negative side, Treasuries are rallying again.  China is very weak and is flirting with some support.  If it breaks there, our markets may ease back further as well.

There is a feeling among many Bears that we are still going to have a significant rally into year end, but “boy oh boy, we really need a correction here” – more than we have had to date.  What could bring the correction would be failures in the earnings season about to hit the calendar.  As I’ve mentioned, there are those like the Economic Cycle Research Institute who feel the economy is going to go into a mild recession and it will get worse if oil/gas prices go sky high.

The other big issue is where money from individual investors goes from this point on.  Over the past year it has continued to LEAVE stocks and enter bonds, entering a bubble that Warren Buffett has warned against.  The assertion is that the next rally is going to be driven by a shift back from bonds to stocks.  This will NOT happen if bonds continue their recent rally.  Watch the Oct. low in bonds.  If that breaks, stocks will benefit as long as rates do not go sky high indicating high inflation levels.  A gentle rise of rates will likely be tolerated, but not a rapid, huge increase that would shut down the housing market.

Enjoy your week! 

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

To see the entire current issue and this week’s ratings of all 35 markets I follow and receive the newsletter every weekend for free when it is published, subscribe here: 

www.sunandstorminvesting.com/subscribe-to-sp500tracker-newsletter-and-tips.html

 

Enjoy your week! 

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

2012 Copyright By Wall Street Sun and Storm Report, LLC All rights reserved.

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Market Timing Brief™: ECRI Says Recession Ahead, Mild or Moderate?

Posted on March 11, 2012 by David Durand

Brief for 3-02-2012:

On Friday I started a position in the VXX which goes up if the market (SP500 Index) goes down based on the increase in the volatility (level of fear) when that occurs.  Why?  Because the SPX has hit the 2011 high and is coming down from there.  There is a sense that there are not enough buyers to carry us to new highs.  If I’m wrong, the risk is just a few percent (not zero), but if I’m right, the gain is likely at least 3 times as great and potentially more.  It all depends on the depth of the correction.  NOTE: See Twitter feed.  Currently short QQQ and out of VXX trade at profit.

We have not corrected perhaps in part due to the fact that so many are predicting a pullback.  But when that sentiment aligns with caution about the economy, selling may finally begin.  It may not be enough of a correction for long term buyers to be concerned about, but my plan is to vacate the market in steps (already 50% out of “normal” equity position) and re-enter as needed, higher or lower in steps.  What has me leaning toward a correction is the ECRI (Economic Cycle Research Institute) study I Tweeted on March 1st (see link to Twitter below and then read my latest list of Tweets; you don’t have to have an account to get to the link.)  The study by the ECRI, which has been very accurate about predicting recessions, shows that the rising employment we have seen is a lagging indicator in that GDP peaked in 2010 and has been FALLING.  Since the stock market discounts things ahead of time, and it’s behind on that already, it will soon start correcting to reflect lower SP500 earnings to come.

The ECRI says that the depth of the recession will be influenced by how high oil prices get.  A recession in the midst of high oil prices could give us in a much deeper recession.  Another negative is that housing stocks have reversed a breakout above the 2011 high. (HAVE SINCE FIRMED UP)  That may drag the banks lower as they are very connected at this time.

Small cap stocks have broken into a legitimate correction (SEE CURRENT REPORT – link above; bouncing now).  As they tend to be less liquid than their larger breathren, it could be “a sign” of the start of a general market correction.

All that said, the Bulls still have their arguments.  The biggest one is that the financial did not sell off much on Friday and the volume went down as that small pullback occurred.  Tech has yet to start correcting.  The NDX which is heavily Apple (20%), was down only 0.07% on Friday.   So as you can see, the call to sell this market is early in that the markets are not selling off briskly in unison yet.  My stops have brought my stock exposure down to 50% of my maximum exposure, which I was at very recently.  My exposure will plummet if we should start selling off.  I exited my silver position with a profit, but kept my gold trading positions.  Remember that I am not trading my long term position.

What I noted during the last major pullbacks in the stock market that I did not share “publicly” last week, and said I would here, is that gold and gold stocks can rally during the start of a significant pullback in the SP500 Index.  Then the metals and their stocks fall with the stock market.  So I am looking for a “terminal rally” for gold before it succumbs.  Gold holds up better than silver during these pullbacks, which is why I exited the silver position and kept the gold positions.  The trouble brewing for gold is the stronger dollar. The dollar could go into a significant rally from the bounce over the past few days unless the Fed pulls the plug on it again.  With the Fed and other foreign governments throwing their wrenches into the system periodically, making dollar predictions has become very difficult since 2008.

Set your mental stops on your profits (WRITE THEM DOWN and email them to yourself so you have a record) and …

Enjoy your week!  

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

This is the text from a previous free “Weekly Wall Street Sun and Storm Report™.  To see the full current issue and this week’s ratings of all 35 markets I follow and receive the newsletter every weekend for free when it is published, subscribe here: 

www.sunandstorminvesting.com/subscribe-to-sp500tracker-newsletter-and-tips.html

Enjoy your week! 

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

2012 Copyright By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, gold stocks, inflation, investment, Market timing, trading, US Dollar Index | Tagged , , , , , , , , | Leave a comment

Market Timing Brief™: Inflation Is Here

Posted on February 29, 2012 by David Durand

2-24-2012:

NOTE: This was written pre-Fed speak on Capitol Hill today that took a toll on the inflation hedges like the metals.  This shows you the power of the Fed over the markets.  Dr. B bascially jawboned the markets down today.   GLD was down 5.30%.  SLV (silver ETF) was down 6.36%.  Most of the damage occurred in a few big waves down.  Follow me on Twitter for the latest updates.  The following was published on 2-26-2012.

The Dow Transports remain weak in the face of rising energy prices.  Oil is on a tear as are metals.  Chairman Bernanke HAS his inflation now.  He was hoping for it, and now he’s created it along with the wizards in Europe, who are taking savers’ money and trashing it.  So we need to do things to protect the value of our dollars.  Buying real estate at depressed prices, buying metals, and buying dividend producing stocks are all ways to do this.  As an aside, take a look at DBA as a “catch-up” candidate to DBC (I believe both entail some extra tax filing of K-1’s just to warn you.  Schwab does that submission for me for DBC for free in the case of my IRA).  So far DBA has stabilized but not rallied with DBC.

Buying bonds may even work for a while longer, but not that much longer.  We do not live in Japan (unless you do as some of my readers do!  And a hello also to the growing Chinese readership as well.).  The Fed has gone out of its way to create inflation, so I do not believe interest rates are going to remain near zero percent for more than 6 months to a year.  China loosened its monetary policy this week as well.  Certainly, with rising inflation the Fed will be on hold in regard to any other Quantitative Easing or maybe even debt repurchases, well, except for housing.  It may still be active in the housing debt market, which caused our financial problems in the first place along with years of loose credit from the Fed.  Set mental stops on the losses you will take in bond positions if interest rates start climbing.

That said, it’s not a good idea to sell up trends that are still continuing, but keep on the ball and use stops.  And you should know that Gary Shilling believes that Treasuries still have room to rally.  The interesting thing is that his projections have been dead on while others have steadfastly predicted inflation to the detriment of their portfolios.  So we look at the facts to see where there could be trouble, but look at the charts to PROVE that trouble is either here or about to arrive.  That is the power of this newsletter’s approach.  We do our best to stay AWAKE, conscious!  We do not form assumptions and get stuck with them when the facts change and more importantly, when the charts say we are no longer right.  The stock market will tell you what Wall Street won’t.

If the government decided to dramatically tighten credit, the entire paragraph above would need to be rewritten, so even things like gold that have worked for years could now stop working.  So I would advise paying attention to the big trend changes as they show up.

The banks have held the recent breakout above the January highs and that is the line in the sand.   If we do see a correction begin, the market could retest the October bank breakout and still maintain an up trend.  Housing stocks are testing support again and could break with the next flux of foreclosures moving into the market, but so far it’s simply a correction in a strong up trend.

Oil has moved to a level where it must impact spending in our economy.  It is a huge tax and if there is war, oil will skyrocket (really, it already has skyrocketed but it will be far worse if there is a conflict).  The Iranians could endanger passage of oil through the Strait of Hormuz.  That is the key pressure point for oil according to analysts.  The Saudis say they’ll pump more, but there is a limit to their ability to expand their output.  It may have some short term impact on oil prices.

Natural gas stocks are extremely interesting in their behavior as they move up in the face of crashing natural gas prices.  Obviously the market is discounting a huge increase in natural gas prices.  I’ve read that Walmart has joined the earlier natural gas converts like UPS in converting their trucks to natural gas.  If the White House had an energy brain or two instead of a czar, we’d have natural gas stations being built all over the country, employing the unemployed construction workers, and we’d be buying property in Saudi Arabia in a few years.  Exxon knows this, which is why it has paid up for its natural gas purchases recently.

This is the text from a previous free “Weekly Wall Street Sun and Storm Report™.  To see this week’s complete ratings of all 35 markets I follow and receive the newsletter each and every weekend for free when it is published, subscribe here: 

www.sunandstorminvesting.com/subscribe-to-sp500tracker-newsletter-and-tips.html

Enjoy your week! 

More at: http://www.SunAndStormInvesting.com/

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

2012 Copyright By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, gold stocks, inflation, investment, Market timing, trading, US Dollar Index | Tagged , , , , , , | Leave a comment

Market Timing Brief™: 2012 The Year of the Living Dead

Posted on January 4, 2012 by David Durand

The insights in this article resulted in fantastic gains for those of us who took action.  Check the performance of banks (BKX, XLF), housing (HGX, ITB), and biotech (BTK, ) since the article was written. If you would like to have free access to more insights like this, please:

1. Bookmark my feed page so you never miss my latest articles wherever they are published: Read Latest Market Timing Feed and

2) Get my take on 35 different markets each weekend at no charge by signing up here: Free Weekly Wall Street Sun and Storm Report™ (35 market review)

Market Timing Brief™ for 01-04-2012: The Year of the Living Dead

Risk is back on in the New Year.  Banks and housing which had already started rallying prior to the New Year moved up strongly today having technically died last year.  Biotech, which had been in a major slump badly lagging the market, is beginning to move again.

One negative sign for the S&P500 Index I saw today was the VIX.  It did not move down as it should have in a very positive rally.  Why?  Because traders were NOT taking off their hedges.  That is what the VIX is based upon.  It can and must still move down more.  It was only down 1.84% today.

Gold (GLD) and silver (SLV) had a great day having made important reversals that should propel more gains.  Follow my comments on Twitter to keep up with the latest (link below; I bookmark links of the Twitter pages I follow so I can dial them up fast).  We’ll have to see if the gold rally fails at higher resistance which looms above.  But that is true for any pullback.  The key question is whether the gains will be held or lost once more.  The long term signal has turned at least temporarily negative for GLD and what concerns me is that there is a case for the dollar index (USDX UUP) continuing to rally up to around 87ish which would pressure gold significantly. 

Commodities (CRB index) are stretched at this point so despite the tempting strength, it’s been a bit too much too fast.  That is not to say commodities (CRB) do not have more upside after a bit of a pullback.

It is not so clear what will happen this year.  There are mixed economic signals.  Today’s manufacturing data was improved both in China as well as in the US.  Europe is slowing still.  This means that being nimble and not giving up profits may be the game for 2012 as well as 2011 when the market was barely up for the year.  Things are still unstable in Europe we have to remember despite the bursts of enthusiasm.  The earlier bursts died and now we have this jump for joy.

However, the point for traders is that charts such as that of Europe (VGK) and Germany (EWG), as I pointed out on Twitter today, are improving.  The living dead are back in play at least for the time being.  It would be nice if there were only two shoes to drop – one in the US and one for Europe, but the closet is more like that of Imelda Marcos (a famous shoe fanatic most of you still recall).  Even Japan has something like 3 trillion dollars of debt maturing this year alone.  Risk still lurks despite even as we trade and invest in these markets.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

More at: http://www.SunAndStormInvesting.com/

And to follow my Buys and Sells and up to the minute insights, please follow and bookmark my Twitter feed here: http://Twitter.com/#!/SunAndStormInv

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

2012 Copyright By Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, gold etf, investment, Market timing, S&P 500 Index, silver, trading, US Dollar Index | Tagged , , , , , , , , , | Leave a comment

Market Timing Brief™: Stocks are “In the Middle,” gold is edging up, and the Dollar is Slipping

Posted on December 3, 2011 by David Durand

Read Latest Market Timing Feed

Market Timing Brief™ for 12-02-2011: Monkey in the Middle

1. Multiple markets are now in the middle of runs.  It makes it harder to add to positions that are in the middle.  You can do it if you use stops below these levels.  Giving up everything between here and the summer lows does not interest me.

2. UPDATE: GLD is now edging DOWN, not up as you can read in my Twitter feed to the right.  Today GLD hit its 50 day moving average and bounced.  The last time it did that, it failed the next day (Nov. 21st).  Things change quickly and Twitter is the fastest technology I have to communicate with you.

Gold is still in a market timing up trend over the short term.  But there is overhead resistance as shown in the chart from Friday (click here for all my latest updates:  Read My Feed).  I commented on Twitter on Friday that the silver chart (SLV) is not as supportive as the gold chart.  SLV could start sliding down its 50 day moving average and then break it.

3. Sentiment is not that supportive of more than a moderate rally as I outline on my AAII sentiment survey page here: Survey Says! AAII Survey Review

4. The US Dollar is in danger of breaking on a market timing basis, but the near month dollar futures sit at the 50 day moving average, which must be broken soon (see chart below).  We do have a lower high in for November as well as a break in the upward wedge I pointed out previously, so the dollar Bears have the ball overall.

US Dollar Index Chart: near month futures market timing

US Dollar Index Market Timing Chart

5. The stock market indices have some room to rally, but won’t if the Europeans mess up in any significant way.  They are still making changes to a system that are extremely awkward given the lack of a common governmental body.   The ECB was obviously not well thought out as a concept.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

More at: http://www.SunAndStormInvesting.com/

And on Twitter: http://twitter.com/#!/DavidBDurandMD

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

The last video update on the Stock Market is here: This Weeks Video Chart Update (update on Sunday 12-04-2011)

Follow my Twitter comments during the market day (link to right).

2011 Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, gold etf, investment, Market timing, S&P 500 Index, trading, US Dollar Index | Tagged , , , , , , , , , | Leave a comment

Market Timing Brief™: Stocks and Gold Fall as the US Dollar Wedges Precariously Upward

Posted on November 22, 2011 by David Durand

Market Timing Brief™ for 11-21-2011: Bullish Signs and Hopes in a Sea of Red

Europe remains a mess and the US is not far behind with lawmakers unable to make any progress on the deficit  The fact that they can now put off the deficit until after then next Presidential election is very convenient!  S&P is threatening to downgrade our debt again if the $1.2 trillion in automatic cuts are eliminated.  Enough is enough.  Let’s vote the bums out – regardless of party affiliation and elect people who have brains that think independently rather than simply follow the party line.

The VIX volatility index failed to hold above the 50 day moving average today (VXX, VXZ, SPY,SPX).  That is bullish for the stock markets.   Seasonality is often positive over the two days prior to holidays.  In addition, I suspect Black Friday sales will be OK which could boost the market by Monday.

Gold continues to slide and has more to go (GLD, IAU, DGP).  It still appears to be a correction, rather than more, but I will monitor this of course.  Commodities are sinking with gold.  I claimed weeks ago that European nations would be selling gold to raise cash and that has become a mainstream concept at this point.

Since the dollar is at risk of breaking an upward wedge to the downside, it could crash back to the Oct. low (USDX, UUP).  That would spur a gold rally, so we may not have far to go until gold shines once more.  My feeling is that you may as well buy it on the way up rather than down.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

More at: http://www.SunAndStormInvesting.com/

And on Twitter: http://twitter.com/#!/DavidBDurandMD

By the way, if you “liked” this post, I would greatly appreciate it if you would “Like” it below at the “Share” arrow below and/or re-Tweet it.

Standard Disclaimer: Remember, it’s your money and your decision as to how to invest it.

The last video update on the Stock Market is here: This Weeks Video Chart Update

Been wondering about how investors are feeling? (will be updated tomorrow)

Survey Says! (AAII Sentiment Survey that is!)

I’ll put up an update on Saturday on sentiment.

Follow my Twitter comments during the market day (link to right).

2011 Wall Street Sun and Storm Report, LLC All rights reserved.

Posted in gold, gold etf, investment, Market timing, S&P 500 Index, trading, US Dollar Index | Tagged , , , , , , , , , | Leave a comment

Market Timing Brief™: Seven Signs on the Direction for Stocks, Gold, and the US Dollar

Posted on November 16, 2011 by David Durand

Market Timing Tells on the Markets

NOTE ADDED: Friday, 11-18-11 on VIX

1.The SP500 Index (SPX; SPY) is at the lower up trend line of the triangle the SP500 has been in as explained in this week’s video chart.  If we break that line, there will significantly more damage.

2. On a positive note, the housing index barely fell today, down only 0.04%.  The entire market was down on the Fitch report that said US banks were significantly exposed to the Euro Mess.  We already knew that.  But apparently, when the same negative statements are repeated, more people hear them the next time.   Banks were not down quite as much as I expected either (BKX; XLF)

3. Another positive is that the consumer is buying at some places such as Home Depot, while the results at Walmart were not as perky.  I have the feeling it’s going to be a white Christmas for retail however.  US  consumers AND investors are not as focused on Europe as the professionals are.  Perhaps they “should be,” but they are not.

4. The US dollar rally (USDX; UUP) is posing a bit of a threat to multinational earnings strength, but sooner or later the money press will pop out again at the Fed if that trend gets too strong.  The Fed is going to want to manage the dollar index strength within a band and we’re pressing the upper part of the band at this point.

5. Dollar strength means weakness for gold (GLD ETF).  Gold looks like it is turning over at least for a further correction.  The weakness in the Euro may help bring in some gold buying to counteract this.  But realize that as stocks are sold, eventually gold is sold as well, both for liquidity reasons and initially simply due to dollar strength – if the dollar gets too, too strong, gold falls.

6. Emerging markets are sinking.  Look at India (PIN).  It’s what I call a Bear 4 market.  The Chinese market is also turning over again, although it may not fall to the lowest of the recent lows.  The FXI, for example, may stop at the 50 day moving average and bounce.  If it doesn’t, that would be a very negative sign for our markets.  The world functions in unison in the 21st Century and China is a leader.  Shoot the leader and the rest fall.  (that’s why the generals stay way back in all the wars of course, except for Patton and a few others).

7. The VIX (volatility index) is moving up in the consolidation band it has been in and it has farther to go too.  Watch how it acts at around the 50 day moving average.   It has not held the VIX back, but the VIX reversals have occurred after brief and shallow rises through the 50 day moving average.   That could occur as early as tomorrow morning.

11-18-2011 NOTE:  The VIX in fact went slightly above the 50 day moving average yesterday and is moving back down a bit today.  It could just continue down with any improving Euro mess news, but Bears could point out two things:

There is the potential for a reverse head and shoulders formation on the daily chart, which could cause the VIX to blast up to somewhere beyond the August VIX high (and the SP500 index would be falling hard in unison).  The head would be the August low and the shoulders would be the mid-October low and the November low.

This “blast off” is activated if and when the VIX moves up through the “top” of the formation which is represented by the highs on the daily chart from mid-October on.  It seems more likely that the VIX will drop toward year end.  We could then sell off again, but let’s not get too far ahead of the market!  If Black Friday shopping is strong the Bulls will be emboldened.

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