Dow Theory Update for November 1: Industrials failed to confirm primary bear market by less than 3 points

Hence, US stocks continue flirting with primary bear market signal

US STOCKS

The primary trend is bullish as explained here and here

The secondary trend is bearish (secondary reaction against the primary bull market) as explained here

According to the “Rhea/Classical” Dow Theory no secondary reaction has been signaled yet, as explained here. However, I see a distinct “line” as both the Industrials and Transports have been ranging by less than 5% for many trading days.

On September 30^th, the Transports managed to rally more than 3% off their September 14^th secondary reaction closing lows, and hence it set up US stocks for a primary bear market signal. Moreover, the Transports made higher closing highs (the primary bull market closing highs of September 8^th were bettered) which was unconfirmed by the SPY and Industrials. The longer the lack of confirmation persists the more suspect the breakout.

Please mind that a setup for a primary bear market is not the actual signal. If the Transports breakout got finally confirmed, the primary bull market would be reconfirmed (something which is unlike as of this writing).

On October 13, 2016 the SPY violated its September 14 secondary reaction closing lows (red horizontal lines on the right side of the chart). However, until now, neither the Industrials nor the Transports have confirmed. Thus, no primary bear market has been signaled yet. Today the Industrials closed at 18037.1 whereas their secondary reaction closing lose stand at 18034.77. Hence, the Industrials lie at only 2.33 points from signaling a primary bear market signal. Maybe tomorrow?

Thus, the market remains in a nowhere's land. The breakup of the Transports (which is bullish) remains unconfirmed, whereas the violation of the secondary reaction lows by the SPY (which is bearish) remains unconfirmed.

GOLD AND SILVER

The primary and secondary trend is bearish, as was explained here and here.

GOLD AND SILVER MINERS ETFs

The primary and secondary trend is bearish, as was explained here and here.

General observation for US Stocks, gold and silver and their ETF miners

The trend, when appraised by the Dow Theory when using weekly bars, is bearish for all the above mentioned markets.

Sincerely,

The Dow Theorist