Keep in mind that today's spike upside reversal in gold comes 3-4 weeks prior to my expectation of a cycle bottom, and that under normal circumstances such a situation would argue for another loop down to revisit the $1530/25 area after this initial recovery rally period.
Originally published on MPTrader.com.
I am in waiting mode and do not have any new thing to say or discuss today. SPX closed below 1330 and as I have said before, I would wait for it to close two consecutive days below 1330 to decide whether to take short position again. However I think we are due for bounce.
Even after the blow off in silver and gold's euro hysteria-induced blow off I did not expect a repeat of the 2008 crash in the HUI Gold Bugs index to happen given the state of the real price of gold (RPG) today as compared to the run up to 2008. Wrong sir, the black boxes are apparently in control; or are they? Maybe someone is controlling the black boxes.
Ben Bernanke has stated that he would control Treasury yield curves. This is not tin foil hat analysis seeking to rationalize, it is merely stating what the world's most powerful monetary policy maker said he would do.
The bulls made another brave attempt to deliver a bounce yesterday, and failed badly again. I have channel resistance at 1334 SPX today and a break above might well be a bull trap, as both of the last two breaks were. Here's the channel on the SPX 15min chart: