Runaway move update.
If stocks are in a runaway/creeper move higher then we have about 10 more points to go in the SPX to reach the 40 point retracement level that should force another reversal.
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Miners are still looking strong, but I can’t bring myself to chase it…
It’s way too late in the intermediate cycle to chase. Just be patient and don’t worry about missing some of the move. It’s impossible to catch every last penny of a rally. By June we will get an intermediate degree correction and that is the time to buy aggressively again.
Oh I agree fully Gary, I did very well, like you said no need to chase pennies 🙂
From where you count point difference, intraday top or close? because from 2110 it is already 50 points. Doesn’t mater few points here and there I guess..
The intraday top was 2111. The low so far today is 2080. That’s 31 points.
I think your calculator is broken 🙂
oh ya!!! my bad.. why I was thinking 2060..ha ha..
The rally in the miners was too much too soon …
Downside coming, as much as 80% of miners’ recent gains.
Say it ain’t so, I’m still 75% invested in them.
Fortunately, you will have time to get out of then if you chose to: it’s going to be an arduous and grinding decline in gold and miners into May/June as Gary has indicated also.
Gold itself will fair better in the correction than the miners.
I am not so sure, it looks like that the corrective cycle has inverted. Gold could rise into mid June before a deeper correction.
Gary — thanks for the important update. Sounds like you do not see more downside in SPX than approx. 40 points. My concern this time is the imminent weak seasonals starting in May (especially after a huge run up) and that we have come so far so fast. Am worried that odds favor more downside this time.
No intermediate cycle in history has ever topped with the ROBO ratio showing mom and pop traders so heavily bearish.
When I start seeing lots of comments here on the blog similar to what we are seeing about gold right now…
(I am not so sure, it looks like that the corrective cycle has inverted. Gold could rise into mid June before a deeper correction.)
… then it will be time for stocks to move down. This is always how it works. Little guys trade off their emotions and recency bias. They expect trends to continue indefinitely. Smart money trades based on the principles of regression to the mean.
The longer anything rallies the more confident retail traders become. On the other hand the longer something rallies the more nervous a professional trader becomes.
Short interest hasn’t been this low since mid December. You all remember what happened after that. Markets are all bulled up at tops, not bottoms.
Nothing at all has changed materially on the plus side since the market crapped out last year, but plenty has changed for the downside including 2 straight quarters of earnings negative growth
, which has never not resulted in a recession. We are into 3 straight.
The market does what it’s best at, and has sucked every one in. Anyone buying stocks right now, is flat out bonkers, and just asking to get their clocks cleaned. Hell, now they are taken bullish golden crosses and all that nonsense over at BI. Tell me one time, when BI has ever been right on any market call . Name one.
Short interest historically has been completely worthless for timing tops. As a matter of fact short interest recently was almost the same level as the bottom in 2009. That would argue for a rally, not a sell off.
Again let me caution against thinking that we are trading free markets. We are not, and haven’t been since QE1 began. Once central banks committed to artificially elevating stock markets by printing money they figured out they could hold off recessions. You can’t have a recession with stocks rising.
The problem isn’t going to be a deflationary bear market. The problem will be another series of bubbles that eventually implode. That’s when the next recession will occur.
The bear case is already dead. The Dow is back to making higher highs. The advance decline line is making higher highs, and all indexes have broken their 7 year cycle down trend lines.
Great job on HoweStreet.com today.
Such wisdom !!!!!!!!!
It’s so nice to follow the wisdom and experience of a true trader.
After trying to trade out of my own limited understanding of charts and market movements,it
is sooooo nice to be able to listen and see and rely on someone who knows how the market is going to move and why.
I think oil goes to $38-$39 and maybe $SPX tests $2,100 but no major bear on the horizon.
what’s going on w/ LABU ? it really lost steam….
It didn’t do what I was expecting early this week so we took profits this morning and are now on the sidelines in the stock and metals portfolio. The only portfolio with an open trade at the moment is energy.
Shall we not keep LABU until June or ? I am holding ERX and LABU but I am not sure until when is the best time…what do you think Gary?
We took profits on LABU this morning. You need a susbcription to the premium newsletter if you want to get real time updates.
Gold and Miners official bull market
Apple had a slowdown in sales and is tanking. If the market sells off from here I am thinking oil as well as gold should also sell off since they moved together. Gold and oil went up with the market so now they should go down. USD should gain strength from here as it looks like it double bottomed today.