The Bullish Trend Continues

Both oscillators are strong and overbought, but they should start losing momentum as the index progresses higher, and it is not likely that a short-term sell signal will be given until CCI shows some negative divergence and ultimately goes negative.  

UUP (US Dollar ETF) Daily Chart

UUP may be close to completing its three-month uptrend. Negative divergence has started to form in both daily oscillators and the index is running into resistance from its 200-dma. This is a slow-moving index, so it could be several days before a short/intermediate top is formed and a reversal takes place. 

GDX (Gold Miners) Daily Chart

GDX made its big up-move during the time that the USD was in a severe decline. Since then, the dollar’s downtrend has decelerated and reversed. The reversal is not expected to be a major turning point and the uptrend is already showing signs of having met its objective.  

The same signs are occurring in GDX but in reverse. Consequently, it is likely that GDX has already completed its correction, may already have retested its low, and will soon be positioned to reverse course.

PAAS (Pan American Silver Corp) Daily Chart

What was said about GDX and gold also applies to PAAS and silver, with the only difference being that PAAS’s correction was milder and that it did not retrace as much ground. 

BNO (Brent Oil Fund) Daily Chart

BNO met a secondary projection and is correcting. It is now ready to move higher, but it could retest its high in conjunction with market strength.  

Summary

SPX started a new intermediate uptrend from 3723, with the first phase ending at 3980. After a pullback to 3953 last Thursday, the index started the second phase which is aiming for ~4150. After another brief consolidation, a third phase should continue higher to about 4300-4350. After we reach that level, we should start looking for a possible top to the advance from 2009.

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Charts are courtesy of QCharts.

The above comments, as well as those made in the daily updates and the Market Summary about the financial markets, are based purely on what I consider to ...

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