The ORD Oracle, 1-30-17

SPX Monitoring purposes;  Short on 1/30/17 at 2280.90
Monitoring purposes GOLD: Long GDX on 12/28/16 at 20.25.
Long Term Trend monitor purposes:  Short SPX on 1/13/16 at 1890.28

The bottom window in the chart above is the three day average of the Put volume/Call Volume.  When this ratio falls below .85 (last Thursday reading came in at .80) the market is usually near a high. The circled areas show the times when this ratio fell below .85.  Today the McClellan Oscillator fell below “0” closing at -62.42 and added to the bearish short term scenario. FOMC meeting is tomorrow and Wednesday and could add short term volatility to the market.  The presidential cycle suggests February will be down. Short SPX on 1/30/17 at 2280.90.

The bottom window is the Bollinger Band Width which we showed last Thursday.  The Bollinger Band Width has stayed below 30 since mid December and the previous times when this developed the market was not far from a top.  Its common for market to make three higher highs before topping and the NYA may have complete its third high last week.  It also appears the NYA is completing the bearish pattern “Three Drives to Top” which has a minimum downside target near 11k. One of the triggers for a top is for the DJI to close above 20K with lots of media attention, which we got.

The internals look bullish for GDX.  Though GDX is below the November high of 26.00, both Advance/Decline percent and Up down Volume percent have exceeded the November highs suggesting at some point GDX will also exceeded its November high.  We have said in the past that the GDX/GLD ratio leads GDX.  GDX/GLD ratio is in the bottom window and as you can see GDX/GLD ratio has exceeded its November high suggesting at some point GDX will also exceed its November high. There can be backing and filling for GDX short term, but the rally that began in December appears not done.  Still expecting higher prices for GDX.   Long GDX on 12/28/16 at 20.25.