Friday, June 30, 2017

Dow Theory Update for June 30: The Transports have not confirmed yet





Trends remain unchanged

 

Days pass by and nothing is accomplished technically, which is normal, as primary trends, as appraised by the Dow Theory, tend to last one or more years. To some extent, what we witnessed in the last few years (primary trends of shorter duration in both US indices, precious metals and their stocks) was an oddity rather than the norm.  In my last post I was wondering whether "fibrilation" was over. In real time, we can never know. However, what I see is that trends are lasting longer, which results in the paucity of "news".

 
US STOCKS

The primary trend is bullish since November 21st, 2016, as explained here and here.

 The analysis I made in my post of June 1st, 2017 remains fully valid. After June 1st the Industrials and the S&P 500 have made marginally higher closing highs, while the Transports remain below their last recorded March 1st closing highs, in spite of today’s rally which put them at shooting distance of their March 1st highs.

All in all: No confirmation. The longer it takes for the Transports to confirm, the more suspect the current rally becomes.

Here you have an updated chart:

Some 30 points and the Transport would have confirmed the Industrials and the S&P 500


 

GOLD AND SILVER

The primary trend turned bullish on April 12th, 2017 as explained here

The secondary trend is bearish, as explained in depth here.


SLV and GLD set up for a primary bear market signal, as explained here.
 
On June 6th, 2017 GLD broke up its April 18th, 2017 primary bull market closing high (bottom chart, blue arrow). However, SLV did not confirm by a wide margin (which I interpret as being bearish), which implies that the primary bull market was not confirmed. Immediately thereafter, both precious metals have declined with gusto.

If SLV and GLD jointly violated their primary bear market closing lows (red horizontal lines), a primary bear market would be signaled.


GOLD AND SILVER MINERS EFTs


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

The secondary trend is bullish as explained here

As was explained here, SIL and GDX have set up for a primary bull market signal.



Sincerely,
The Dow Theorist

Saturday, June 17, 2017

Dow Theory Update for June 17: The Transports go on refusing to confirm the Industrial’s and S&P 500’s higher closing highs



GLD broke up its primary bull market high unconfirmed by SLV


US STOCKS

The primary trend is bullish since November 21st, 2016, as explained here and here.


The analysis I made in my last post of June 1st, 2017 remains fully valid. After June 1st the Industrials and the S&P 500 have made marginally higher closing highs, while the Transports remain below their last recorded March 1st closing highs.


All in all: No confirmation. The longer it takes for the Transports to confirm, the more suspect the current rally becomes.

One thing is clear: The benefit of doubt is always to be given to the current trend. The primary trend is bullish, and lest we forget, the trend when appraised with weekly bars using Dow Theory rules is unambiguously bullish.

By the way, the current primary bull market signal (given on November 21st, 2016) will soon be 7 months old. While this is less than the average duration for a Dow Theory signal, at least we are getting a “longer” signal that those we had in the last two years. Is the whipsawing over? I don’t know. I just stick to well digested rules. I only know that it was very hard to me to honor the November 21st, 2016 signal, as I thought that another whipsaw was in the making. However, I was disciplined. Maybe what I wrote here and here, helped me stay disciplined. Recent "fibrillation", no matter how annoying it is, is to be regarded as an oddity.

GOLD AND SILVER

The primary trend turned bullish on April 12th, 2017 as explained here

The secondary trend is bearish, as explained in depth here.


SLV and GLD set up for a primary bear market signal, as explained here.
 
On June 6th, 2017 GLD broke up its April 18th, 2017 primary bull market closing high (bottom chart, blue arrow). However, SLV did not confirm by a wide margin (which I interpret as being bearish), which implies that the primary bull market was not confirmed. Immediately thereafter, both precious metals have declined with gusto.

If SLV and GLD jointly violated their primary bear market closing lows (red horizontal lines), a primary bear market would be signaled.

Here you have an updated chart.

Lack of confirmation by SLV and a bearish trend when using weekly bars spells trouble for the current bull market

 
As an aside, it is worth mentioning that the primary trend when using weekly bars is bearish, which tends to be headwind for any meaningful bullish action.

GOLD AND SILVER MINERS EFTs


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

The secondary trend is bullish as explained here

As was explained here, SIL and GDX have set up for a primary bull market signal.


Sincerely,
The Dow Theorist