Dow Theory Update for Dec 14: Stocks down. Precious metals mixed

Under Dow Theory nothing has changed

Let’s begin with our Dow Theory analysis for today in this blog.

What are other Dow Theorists doing? Richard Russell, of the "Dow Theory Letters", who was turning mildly bullish (or at least not outright bearish short term) is turning bearish again. He hoped that the last rally was going to have longer legs. He has been disappointed by recent market action.

Jack Schannep, of "thedowtheory.com" sends us an unambiguous message: The primary trend is bearish since November.

The SPY and the Industrials closed down today. The Transports closed up. Technically, nothing has changed. The primary trend is bearish and the secondary trend bullish.

Volume was higher today than yesterday’s. As it was a down day, it has a bearish connotation. Here you have an updated chart.

Volume reamins bearish. Even the untrained eye can spot more red arrows

As to the precious metals we had mixed action.

Gold (GLD) and silver (SLV) closed down today. The dreaded Nov 2 secondary reaction lows are becoming nearer and nearer. However, for the time being, the primary trend remains bullish and the secondary trend bearish. As I have written several times, a bullish BLV/GLD ratio (long-term bond term bond /gold) acts as a brake for gold. Gold will not be ready to go really up until such ratio turns bearish, which denotes stronger gold. Furthermore, if the bullishness of the ratio persists (stronger bonds), the odds for a violation of the Nov 2 lows increase. You can read more about this vital, but often ignored ratio, here. So, in spite of my fundamentally-based secular bullishness on physical gold, I cannot ignore the technical warnings in the shorter term.

Conversely, GDX and SIL closed higher. The primary trend remains bullish and the secondary trend bearish.

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

Data for December 14, 2012
DOW THEORY PRIMARY TREND MONITOR SPY
			SPY
Bear market started		09/14/2012	147,24
Bear market signaled		11/16/2012	136,37
Last close		12/14/2012	142,11
Current stop level: Bull market high			147,24
Price chg since bear mkt signaled	Tot decline since start bear mkt	Max Pot Loss %
4,21%	-3,48%	-7,38%
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		12/14/2012	164,13
Current stop level: Sec React low		11/02/2012	162,6
Unrlzd gain %	Tot advance since start bull mkt	Min Pot Gain %
2,24%	9,82%	1,28%
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		12/14/2012	31,17
Current stop level: Sec React low		11/02/2012	29,95
Unrlzd gain %	Tot advance since start bull mkt	Min Pot Gain %
7,78%	21,62%	3,56%
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		12/14/2012	23,15
Current stop level: Bear mkt low			17,08
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
6,05%	35,54%	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		12/14/2012	46,48
Current stop level: Bear mkt low			39,56
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
-2,70%	17,49%	20,75%

Sincerely,

The Dow Theorist