Trends for precious metals and their ETF miners unchanged
This post has been amended on 08/16/2019. I thank Jack Schannep for spotting one minor mistake I inadvertently made when determining the total decline of the S&P 500 from the top made on 07/26/2019 to the day the primary bear market was signalled (08/14/2019). I took the secondary reaction closing low (2844.74) instead of the close of the day the primary bear market was signalled (08/14/2019) at 2840.6. What changes is the total percentage decline from the top made at 3025.86 to the bottom which amounts to -6.12% instead of -5.98% (this is the decline from the top to the secondary reaction closing low). My sincere apologies, even though nothing has changed technically: The primary bear market was accurately signalled.
Yesterday, before the close, I wrote about the setup for a primary bear market which had been completed on 08/08/2019. On 08/12/2019 the Transports violated its secondary reaction closing lows unconfirmed, and hence, no signal was given. However, yesterday, on August 14th, 2019, both the S&P 500 and the Industrials confirmed the Transports by jointly violating their respective secondary reaction closing lows of 08/05/2019.
Please mind that the primary bear market signal has been signaled at -6.12% from the top made by the S&P 500 on 07/26/2019.
Here you have an updated chart.
|Primary bear market signaled on August 14th, 2019
As you know, on average, primary bear market signals have follow through. So, while there are no assurances as to much more decline to follow, the odds favor more declines. The average further decline amounts to ca. 12.5%, which implies that it is more likely than not than further declines, are to be seen. Here is an important post discussing further declines following a primary bear market signal, and what to expect now.
As to the “Rhea/Classical” Dow Theory, nothing has changed. There is still a primary bull market and a secondary reaction remains in force. Neither the Industrials nor the Transports have violated the 05/31/2019 secondary reaction lows. Below a chart. The orange rectangles display the ongoing secondary reaction. The red horizontal lines display the lows of the secondary reaction which have to be jointly violated.
|Primary bull market still in force (but with bad looks) as per the Classical Dow Theory
GOLD AND SILVER
The primary trend is bullish since 12/24/2018 as explained here. No changes. We finally got a secondary reaction on 4/16/2019 when GLD violated its 03/07/2019 closing lows (and confirmed SLV which had done so some days ago). More about the entrails of such a secondary reaction here and here.
On June 18th, 2019 GLD managed to break up above the closing highs of the primary bull market unconfirmed by SLV. Hence, at that time we could not declare the end of the secondary reaction. However, on 07/18/2019 SLV broke up above its hitherto primary bull market highs, and hence the primary bull market has been reconfirmed. From that date both GLD and SLV have made further higher highs. A bull market.
GOLD AND SILVER MINERS ETFs
The primary trend is bullish since 12/18/2018 as explained here. No changes.
On June 17th, 2019 GDX managed to break up above the closing highs of the primary bull market unconfirmed by SIL. Hence, we could not declare the end of the secondary reaction. However, on 07/17/2019 SIL broke up above its hitherto recorded primary bull market highs, and the primary bull market was reconfirmed. Since that date both ETFs have been making higher highs. A bull market.
The Dow Theorist