The ORD Oracle, May 8, 2017

SPX Monitoring purposes;  Sold SPX 5/5/17 at 2399.29 = gain 1.06%; Long SPX on 4/24/17 & 2374.15.
Monitoring purposes GOLD: Neutral
Long Term Trend monitor purposes: Neutral.

 

SPX is running into the March 1 high near 2400 and finding resistance.  The McClellan Oscillator is below “0” closing near -25 and a bearish sign. This week is the week before option expiration which whipsaws are common and a week to be careful.  Seasonality suggests weakness into mid June which can be choppy.  We sold our long SPX position on Friday for gain 1.06% and now are watching for signs for the next setup. Back on the sidelines for now.  Sold Long SPX on 5/5/17 = gain 1.06%.

The second window down from the top is our TICK/TRIN ratio with a 3 period moving average.  To help confirm a bottom in the market, a Sign of Strength” (SOS) is needed off a low. The red vertical lines show when an “SOS” was present off a low and suggests the rally will continue.  On the recent bottom, notice that an “SOS” was not present suggesting the current rally does not have “legs” to continue.  Most likely a consolidation has started that could last several weeks.

Short term positive divergences on present.  Top window is the RSI which has made higher highs where GDX has made lower highs suggests a bounce is possible near term for GDX.  The bottom window is the On Balance Volume which also has made higher highs suggests a bounce is possible.  GDX/GLD ratio leads the way for GDX.  Over the last several days GDX/GLD ratio has outperformed GDX, and a short term positive sign.  The likely upside target for GDX is the gap area near 23.00.   The way it stands, the potential bounce in GDX will be a bounce in a downtrend, as once bounce is complete and other down leg is possible.  Still on the side lines for now.

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