Dow Theory Update for Nov 15: No primary bear market signal yet

Bearish day for precious metals too.

Let’s explore what the market has in store for us today.

Stocks, again, closed down. The big news is that the Transports refused to break its 09/28/2012 lows. At least for one more day the primary bear market signal has been avoided.

Today’s volume was lower than yesterday’s, which has bullish implications. However, as you can see on the chart below, I see too many red arrows (bearish volume days). So in spite of today’s bullish volume, the overall pattern remains short term bearish.

Volume is bearish short term

 As you may have noticed, I pay attention to volume action at pivot points. Does it belong to the Dow Theory? Or it is just a construct of normal technical analysis? The answer is that volume at pivots was found worthy of study by both by Rhea and Hamilton. Thus, Rhea wrote:

“(…) the tendency is for volume to increase whenever new highs or new lows have been made in primary bull or bear markets, with such an increase frequently progressing until something like a climax indicates a temporary reversal of the movement”.

So, keeping an eye at volume at critical points is time well invested.

As to gold and silver both closed down today. The primary trend remains bullish, and the secondary trend remains bearish.

The gold and silver miners ETFs (SIL and GDX) both closed down today. Now, unambiguously, we can say are stuck in a secondary reaction. However, the primary trend remains bullish.

Conclusion: My eyes continued glued to the Transports. Will it break tomorrow its 09/28/2012 lows? We will probably know tomorrow.

Here you have the figures of the markets I monitor for today:

 

Data for November 15, 2012
DOW THEORY PRIMARY TREND MONITOR SPY
			SPY
Bull market started		06/04/2012	128.1
Bull market signaled		06/29/2012	136.1
Last close		11/15/2012	135.7
Current stop level: Bear mkt low			128.1
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
-0.29%	5.93%	6.25%
DOW THEORY PRIMARY TREND MONITOR GOLD (GLD)
			GLD
Bull market started		05/16/2012	149.46
Bull market signaled		08/22/2012	160.54
Last close		11/15/2012	166.09
Current stop level: Bear mkt low			149.46
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
3.46%	11.13%	7.41%
DOW THEORY PRIMARY TREND MONITOR SILVER (SLV)
			SLV
Bull market started		06/28/2012	25.63
Bull market signaled		08/22/2012	28.92
Last close		11/15/2012	31.53
Current stop level: Bear mkt low			25.63
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
9.02%	23.02%	12.84%
DOW THEORY PRIMARY TREND MONITOR ETF SIL
			SIL
Bull market started		07/24/2012	17.08
Bull market signaled		09/04/2012	21.83
Last close		11/15/2012	22
Current stop level: Bear mkt low			17.08
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
0.78%	28.81%	27.81%
DOW THEORY PRIMARY TREND MONITOR ETF GDX
			GDX
Bull market started		05/16/2012	39.56
Bull market signaled		09/04/2012	47.77
Last close		11/15/2012	45.97
Current stop level: Bear mkt low			39.56
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
-3.77%	16.20%	20.75%

Sincerely,

The Dow Theorist