For 30 to 90 days horizons SPX: Flat Monitoring purposes GOLD: Gold ETF GLD long at 147.14 on 6/29/11; stop hit at 170 = gain 15.5%. Long Term Trend monitor purposes: Flat
What has worked well short term is that when the Ticks close above +1000 and the TRIN close below .50 the same day a short term top in the SPX is near. We have identified with blue arrow when these condition materialized. Yesterday the ticks closed at +1103, however the TRIN closed at .93. Today the TRIN closed at .49 but the TICK closed at +658 so the rule is not ideal as the last two days had the TRIN and Tick readings but are a day apart. However, High tick closes above +1000 and low TRIN readings below .5 are still bearish and suggest the short term rally my not go far. On August 9 a “Selling Climax” formed at the 1100 level on SPX and most all “Selling Climax” are tested at some point. If the test comes on lighter volume we could end up with a buy signal. The 100 day average of the TRIN is coming in near 1.40 and close to where intermediate term bottoms form. We would like to see the 1100 Selling Climax low tested as there would be a possible intermediate term bullish signal develop at that level. We don’t see a safe trade and will remain flat for now.
GLD appears to have peaked near 185. Previous times on GLD when the weekly RSI got above 75 and the weekly Slow stochastics turned down, a multi week pull back occurred and we are expecting that here. Strong support comes in near the previous trading range highs which are near 155 level. In weekly up-trends the RSI normally finds support near the 50 range with a low in GLD and something we will be looking for on the retracement. Bigger trend is up in GLD, but a pull back near 155 in the coming weeks is possible.
Above is the monthly Canadian SPTGD/GLD ratio with the Canadian gold index SPTGD second window down from top. The SPTGD/GLD ratio hit the 2008 low and shows gold stocks are as cheap now as there where at the 2008 bottom. Since this chart began (started in mid 2000) the Monthly RSI of the SPTGD/GLD ratio has hit 30 only three times. The first time came in early 2008 but the monthly Slow Stochastics never turned up and therefore no signal was generated. The second time the Monthly RSI hit 30 came in late 2008 and the Slow Stochastics turned up late 2008 and triggered a buy signal. Just recently the Monthly RSI of the SPTGD/GLD ratio hit 30 again and has set up a bullish signal. Right now the monthly Slow Stochastics is above 20 (currently at 21.32) and on a buy signal, but since this is a monthly chart, the Slow Stochastics needs to stay above 20 on the close of 9/30 to trigger the buy signal. Previous times when the monthly RSI got to 30 and turned up it trended higher for several months. The SPTGD/GLD ratio is showing strength and at the 2008 levels which show this index is at the best value compared to HUI/GLD, XAU/GLD and GDX/GLD ratio, which are all well above their 2008 lows. Short term gold stocks may pull back, but next rally up may see gold stocks way outperform gold in a big way. We are long GDX at 57.01 with a stop at 59.50. If the stop is hit would imply a pull back to previous low near 54 which we will look for another bullish setup. Long BRD at 1.67 on 8/3/11. Long YNGFF .44 on 7/6/11. Sold on 8/8/11 SLV at 38.32 for gain of 11.4%-Long SLV at 34.39 on 7/5/11. Long EGI at 2.16, on 6/30/11. Long GDX at 57.01( stop at 59.50). Long GLD at 147.14 on 6/29/11; stop 170 hit = gain 15.5% . Long KBX at 1.13 on 11/9/10. Long LODE at 2.85 on 1/21/11. Long UEXCF at 2.07 on 1/5/11. We will hold as our core position in NXG, CDE and KGC because in the longer term view these issues will head much higher. Holding CDE (average long at 27.7. Long cryxf at 1.82 on 2/5/08. KGC long at 6.07. Long NXG average of 2.26. For examples in how "Ord-Volume" works, visit www.ord-oracle.com.
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