We will know soon.
A couple of
days ago, the SPY made a higher closing high whereas the Industrials and the
Transports failed to confirm. The longer such non confirmation persists the
higher the odds for a secondary reaction to develop. Today’s dismal action
makes it more difficult for the Transports or the Industrials to confirm the
SPY’s higher high soon, which at the same time, increases the odds for a secondary
reaction.
In any
instance, we are not in the business of forecasting secondary reactions, but
merely we are intent on determining the primary trend. So we will wait and see.
US stocks
The Industrials, Transports
and SPY closed down.
The primary trend was
reconfirmed as bullish on October 17th and November 13th, for the
reasons given here and here.
Today’s volume was higher than
yesterday’s. This is bearish, as lower prices were confirmed by stronger
volume. I’d label the overall pattern of volume as bearish.
Gold and Silver
SLV and GLD closed down. 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. However, such
set up will be nullified if GLD and SLV jointly violate the last recorded
primary bear market lows, as I explained here.
As to the gold and silver miners
ETFs, SIL and GDX closed down. The primary trend is bearish, as was profusely
explained here and here. Likewise, the
secondary trend is bearish.
Here you have the figures for
the SPY which represents the only market with a suggested open long position:
Data for December 11, 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 | 12/11/2013 | 178.72 | |
Current stop level: Secondary reaction low | 165.48 | ||
Unrlzd gain % | Tot advance since start bull mkt | Max Pot Loss % | |
5.83% | 13.79% | 2.05% |
Sincerely,
The Dow Theorist
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