A New Uptrend Has Started

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SPX Monitoring purposes; Long SPX 4/12/24 at 5123.41.

Our Gain 1/1/23 to 12/31/23 SPX= 28.12%; SPX gain 23.38%

Monitoring purposes GOLD: Long GDX on 10/9/20 at 40.78.

SPY has been up 7 days up in a row; all were higher within 5 days. The second window up from the bottom is the VIX which was up today which suggests the SPY may see a mild consolidation short term. Page two shows that the weekly SPX/VIX ratio hit a new high before SPX. SPX/VIX ratio leads the SPX and suggests new highs are coming for the SPX. The April consolidation is over and a new uptrend has started.

The second window up from the bottom is the weekly SPX/VIX ratio and next higher window is the weekly SPX. We shaded in light green the times when the weekly SPX has not reached a new short term high and the SPX/VIX ratio makes a higher high. This divergence has lead to higher highs in the SPX. Last week we looked at the monthly SPX compared to the monthly SPX/VIX ratio and so far the monthly SPX/VIX ratio has not hit a new high, but the month is not over. The weekly SPX/VIX ratio hitting a new short term high suggests new highs are coming for the SPX.

(Click on image to enlarge)

The bottom window is the daily 50-day average of the up down volume percent for GDX. This is a momentum chart and is designed to catch the trend for GDX. Up trends in GDX are in force when the 50-day average of the up down volume for GDX is above “0”.We noted with a red box the current time frame. Though GDX has moved sideways over the last month (see top window) the 50-day average of the up down volume has moved higher showing this indicator is getting stronger and at some point will translate into a rally in GDX. The pattern that appears to be forming on GDX is a large Head and Shoulders pattern where the Head is the August 2023 low. This Head and Shoulders pattern has a measured target near 50.00. Rally in GDX has further to go in the short term as well as the intermediate term.

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More By This Author:

Positive Divergence Going Forward
New Highs Are Likely
Bigger Trend Is Still Up For The Market