Gold closed outside of it's trading range today. This falling trendline is the daily cycle trendline. Aside from the swing low formed yesterday, this was the next indicator we needed to confirm a new daily cycle is in effect.. the trendline break. Today would be day 2 of this cycle. This is a very bullish development for gold. The next big step will be forming the weekly swing next week.
Silver was unable to close outside of it's range today like gold did, but it did make a higher high. It looks like gold may be leading the way off of the bottom here for metals and stocks as well. Today is day 2 of the new daily cycle.
GDX continued it's bounce off of the bottom of it's channel. If we reclaim the 50 DMA and breakout through the channel, then there will be no looking back.
Stocks sold off again today as they search for a bottom. Indicators seem to point down from here as they have not made any moves to form a bottom and break to the upside. I don't have any cycles charts made for SnP yet, but it's in the timing band for a daily cycle low as well as an intermediate cycle low. The next daily low (which could have been put in today) will also be the weekly cycle low. We should have powerful action out of that final bottom into the new year. At the end of the next intermediate cycle, we'll be in the timing band for a yearly (currently running 15 months), cycle low.
Here's a look at the BOW today. Notice how large. There's a very big gap from number 1 and 2 on the list.
WSJ - Money Flows: Buying on Weakness
DAILY
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TOTAL MONEY FLOW
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BLOCK TRADES
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| Company | Price | Chg | % Chg | 1-wk % chg | Money Flow | Tick Up | Tick Down | Up/Down Ratio | Money Flow | Tick Up | Tick Down | Up/Down Ratio |
| SPDR S&P 500 (SPY) | $139.72 | -3.24 | -2.27 | -1.30 | $233.98 | $3,365.06 | $3,131.09 | 1.07 | $167.17 | $358.66 | $191.49 | 1.87 |
| Citigroup (C) | 36.05 | -2.42 | -6.29 | -4.12 | 63.22 | 361.74 | 298.52 | 1.21 | 43.77 | 72.82 | 29.05 | 2.51 |
The $USD has been chaotic. It sold off heavily last night on election results to only appear to be bought heavily today. These were both knee jerk reactions to the elections and to news coming from Mario Draghi, head of the European Central Bank. I guess it's possible to say that the USD didn't gain value against many currencies today as it may have appeared.. but instead, the Euro weakened significantly. The Euro holds 57.6% weight in the dollar index, so it's moves affect the appearance of the dollar much more drastically than other currencies.
Draghi says ECB plan allows for unlimited bond buys
It made a new higher high today after forming a swing high last night. This created a long candle. Expect a possible inside day tomorrow with a narrow range. That would setup an easy swing high the day after tomorrow.
Conclusion:
In the past it's been common for gold to lead stocks out of a bottom. I think this is being reinforced today by the miners in GDX holding their ground for a positive day while the indexes sold off and gold moved higher.
A sign of things to come? I think so.
Once I can confirm a bottom for stocks, I will be considering a long position in SPY to hold until we top.. with a January Expiry.
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