Dow Theory Update for November 18: Stocks close down on lower volume

Precious metals weak, albeit trends remain unchanged

US stocks

The SPY, and Transports closed down. The Industrials closed up and made a higher closing high unconfirmed.

The primary trend is bullish, as explained here, and more in-depth here.

The primary trend was reconfirmed as bullish on October 17^th and November 13th, for the reasons given here and here.

Today’s volume was lower than Friday’s. This is bullish, as lower prices were not met by stronger volume. I consider volume to be bearish for the reasons given here and here.

Gold and Silver

SLV and GLD closed down. SLV made today a lower low unconfirmed by GLD. Some days ago there was another lower low not confirmed by GLD. If the non confirmation persists for some days, in might be indicative of the current pullback being temporarily arrested for the reasons given here.

For the reasons I explained here, and more recently here, I feel the primary trend remains bearish. Here I analyzed the primary bear market signal given on December 20, 2012. The primary trend was reconfirmed bearish, as explained here. The secondary trend is bullish (secondary reaction against the primary bearish trend), as explained here.

Here, I explained that GLD and SLV set up for a primary bull market signal. However, a setup is not the same as the “real thing," namely the primary bull market; thus, many “setups” do not materialize and until the secondary reaction closing highs are jointly broken up, no primary bull market will be signaled.

SIL and GDX closed down. SIL violated three days ago the last recorded secondary reaction closing lows. GDX, however, refused to confirm. Accordingly, SIL and GDX are still flirting with a primary bear market signal, as was explained here and here.

SIL and GDX, unlike GLD and SLV, are in a primary bull market under the Dow Theory, as explained here and here.

The secondary trend is bearish, which is tantamount to saying that there is an ongoing secondary reaction against the primary bullish trend, for the reasons given here.

Here you have the figures for the SPY, GDX and SIL which represent the only markets with suggested open long positions.

 

Data for November 18, 2013
DOW THEORY PRIMARY TREND MONITOR SPY
			SPY
Bull market started		06/24/2013	157.06
Bull market signaled		07/18/2013	168.87
Last close		11/18/2013	179.42
Current stop level: Secondary reaction low			165.48
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
6.25%	14.24%	2.05%

 

DOW THEORY PRIMARY TREND MONITOR ETF SIL
			SIL
Bull market started		06/26/2013	10.59
Bull market signaled		08/14/2013	15.36
Last close		11/18/2013	12.01
Current stop level: Primary bear mkt low		06/26/2013	10.59
Unrealized gain %	Tot advance since start bull mkt	Max Pot Loss %
-21.81%	13.41%	45.04%
DOW THEORY PRIMARY TREND MONITOR ETF GDX
			GDX
Bull market started		06/26/2013	22.22
Bull market signaled		08/14/2013	28.7
Last close		11/18/2013	23.67
Current stop level: Primary bear mkt low		06/26/2013	22.22
Unrealized gain %	Tot advance since start bull mkt	Max Pot Loss %
-17.53%	6.53%	29.16%

Sincerely,

The Dow Theory