donderdag 29 juni 2017

Thursday Market Observations

*) This bull market from March 2009 is one of the most hated on record, it takes a body blow and comes roaring back. We hit our SPX 2450 target on 6/19 and then started a consolidation that could yield a 5-10% decline into mid-July
# The SPX gave us an "gap-up open" and easily regained the 2431-2454 range. The decline from 6/26 was just a 3-wave affair and nearly all sectors were bought yesterday. Still, yesterday's market volume was less than Tuesday's decline and the market appears to be trading correctively to us. Even if this is just a mild consolidation, we are still vulnerable to a "mini-crash" going into mid-July. After the June-July correction runs its course, we're expecting a high for the year around August 20 (+/-3 trading days) with a minimum target of SPX 2480.
# Gold declined down to our symmetry target of $1236 and finished an EW 5-wave down pattern on the hourly on Monday and then rallied in 5-waves into Wednesday. The trend is higher. The GDX finished a bullish triangle on the daily chart on 6/21, an important 55-day Fibonacci step out from the 5/4 low on Wednesday 6/28 and the GDX reversed higher after an EW a-b-c correction from Monday. The trend here looks also higher.
# Physical silver demand from China increased handily in May; this market is looking higher.
# Crude oil rallied higher Wednesday but oil stocks weakened into the close. Money managers may be trying to purge the big cap oil stocks from their portfolios by the end of Q2, 6/30.
# Bonds declined on Draghi's "end of deflation" comment.
# The USD continued to make lower lows on Wednesday; this is a bullish wind for gold and commodities....