SPX Monitoring purposes; Sold long SPX 5/23/17 at 2398.42 = +1.76%; Long SPX 5/17/17 at 2357.03.
Monitoring purposes GOLD: Covered 6/6/17 at 23.78=loss 2.5%; Short GDX on 5/22/17 at 23.20.
Long Term Trend monitor purposes: Neutral.
The above chart shows what is happening inside the market. The bottom window is the NYSE advancing issues with a 4 period moving average and NYSE Declining issues with a 4 period moving average. As you can see the Declining issues is higher and a short term bearish sign. Next window up is the NYSE up volume with 4 period moving average and NYSE Down volume with 4 period moving average. This to moving average are about equal and a neutral reading for this indicator. Since one is bearish and the other neutral, it puts a negative slate to the market. It is still possible a small “Three Drives to a top” pattern is forming. If the small pattern completes it also may complete a larger “Three Drives to Top” that started back in March. The larger pattern has a downside target near 2300 range on the SPX.
A lot of the time the VIX will give signs a top is developing where the VIX makes a higher lows as the SPY makes a higher high. This divergence showed up at the May high pointed out in the chart above. Right now the VIX is not producing an obvious divergence. However is market retraces down near 2420 range on the SPY (which is a 61.8% retracement) and than rallies to a new short term high and the VIX makes a higher low; and obvious divergence would present itself and a setup for a sell signal. There are other setups but this one could line well and something we will be watching for. Still watching the developing “Three Drives to Top” to completed and a pull back to 2300 SPX range is possible.
There are bullish and bearish signs for GDX and right now we are not going to guess what the right direction is but will point out the bearish and bullish signs. The bottom window is the Up down volume percent and readings above “0” are bullish and the close was +37. Next window up is the Advance/Decline percent and closes above “0” are bullish and the close was +36.90. In general the GDX/GLD ratio leads the way for GDX. Right now GDX/GLD ratio is underperforming GDX and a bearish sign for GDX. Today in candlestick chart a bearish “mid Harami” was drawn which is a topping formation. Yesterday a high volume high was created and most high volume highs are tested and suggest a re-test of yesterday’s high is possible. If the test comes on lighter volume it will suggests resistance (see scenario in blue on chart above). Will keep our powder dry for now. Covered GDX short on 6/6/17 at 23.78 for minor loss of 2.5%. Short GDX on 5/22/17 at 23.20.