Bottom Line:
Stocks – It’s possible Monday marked a low and a test of recent highs is next.
Gold – At least a short-term top is increasingly likely.
VIDEO: https://youtu.be/f8TRiAxjEqU
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The indices are off recent highs to varying degrees, with the DOW “winning” the race toward recent lows. I have been positing the idea of a Balance area the low extreme of which would not reach recent lows. That is definitely still in play, though under this scenario there is little room for more selling below Monday’s lows.
The RUT and NYA, the two broadest indices, are showing relative strength. This is one of the reasons I think the higher level Balance Area is still in play.
VIX spiked higher, but is ell below the recent “panic” levels.
I’m not quite sure how to interpret NYSE internals at the moment, but the 10-day MA of NYSE advancing issues is rising.
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Gold has been the best performing asset class this year. It is trading at all-time highs. Momentum is strong in ALL time frames. It may be a great long term investment.
However, short-term it is getting extended. There may be a better time to buy it, or to add to long positions, a bit down the road.
Gold’s “short” intermediate-term Auction is increasingly due for some Balance.
