The All-One-Market is about to correct
It could be a tradable move
Posted Sep 29, 2010
Gold and Silver Sector
Recently, we have thought that one of the keys to change would be silver, and the
outstanding action registered a daily Upside Exhaustion on September 20. A top was
expected within the next six trading days and today is Number Five.
The "exit" from silver would be prompted by a downtick on price or momentum.
The Silver/Gold ratio also set some RSI readings from which a high would follow by a
week or so. That counts out to this week.
Gold, itself, has become a "Goldilocks" item whereby--as the Financial Post reported
today--it is being recommended for "Inflation", Deflation" and "Hyperinflation".
- Over the past few days, gold and silver stocks have been underperforming the action in
bullion prices and that often anticipates a slump in the sector.
- The Dollar Index RSI reached 27.5 on Friday which is almost to the level that ended the
decline in early August. A price reversal up through 80.50 would be considered
confirmation of a turn.
Our Gold/Commodities Index (GCI) set its recent low at 354 on September 13 and,
typically, the turn up has led the high on the NYSE senior indexes by 5 to 10 trading
This is Day Ten and Friday's close on the S&P was a new high for the move at 1148.
The key in April was 1217 and occurred on Day Six of the GCI count.
The "sunshine" expected in September has been very good and the action is now facing a
weather change. The money market has appeared to be "easy" with low rates for treasury
bills and narrowing of spreads as represented by the Ted-Spread.
"Unusually" low rates for short-dated instruments in the senior currency have been one of
the features of a post-bubble contraction. However, reliable signals have been provided
by a change to steepening in the curve, which seems to have started and by a turn to
In the past couple of days the Ted-Spread has widened a little.
Sep 27, 2010
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