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Thursday, March 21, 2013

Today we were lower as the market tries to make up its mind here.  The Dow fell 90 points on light volume.  The advance/declines were almost 2 to 1 negative.  We started the day lower and continued that theme throughout the session.  I still think that we are in the process of putting in a top now.  I believe the negative RSI divergence on the daily charts will halt the rally that began last November.  I also think we have a five wave up pattern in the S&P 500 daily charts and that this is the final wave higher.  In fact that 5th wave could be done and we simply decline from here.  Or we get more sideways action before heading lower.  Of course I could be wrong in my analysis and the stock indices consolidate here before moving forward again.  We'll see.  GE was off an 1/8 or so on average volume.  A negative RSI divergence on the weekly charts here.  No trades in mind for GE at the moment.  Gold was up 6 bucks on the futures today as the US dollar was a bit lower.  The gold shares showed a little life.  The XAU gained 3 1/4.  ABX, GG and NEM all gained at least 3/4 on good volume.  The gold shares are short term overbought here even though they haven't had much of a rally.  Perhaps the flight to safety trade can last a bit longer but I certainly don't know for sure.  My ABX calls remain solid losers.  Mentally I'm feeling a bit tired.  It will be interesting to see how we close out the week for the stock indices.  Another down day could put some dark cloud cover on the weekly candlestick charts.  That remains to be seen.  Gold has crossed $1600.  I think if we can get past $1620, maybe we can get to the resistance at $1660.  That's a guess as usual.  There is strong resistance there and I would not expect to just break through on the way to $1700.  But the markets go where they want, regardless of what I think.  We'll keep an eye on what happens in the foreign markets tonight and see how we finish up the week tomorrow.  

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