Morning Commentary: SPX, GDX

This morning, the SPX broke its November low by 6 points (735) and has since stabilized in the 744 area. The 8 day cycle low due Feb 25th came 2 days early on Monday. The normal 8 day cycle top came yesterday on day 12 (another one of those pesky cycle and a half adjustments we've seen a lot of lately). Overall, I believe we are in 'c' of "c" of the final wave down for this sequence. Of that wave, I can make the case for wave 1 and now wave 2. The precious metals moved up today, 8 day cycle top for the PM stocks (0), 4 day cycle top for gold (+1) and silver (0). The 39/45 day cycle turn for silver/gold can invert and instead of being a low it can be a top. For gold it was day 39 on the top and silver day 40. Another measure I do to determine cycle lows is to see where 2 rising trend lines (bottoms and tops) converge and for GDX they bisect Tuesday next week. For GLD the up trend line and former top bisect at 871 Tuesday (POG 886/887). Yesterday's GLD/SLV low was +1 on the 4 day cycle low, meaning the minimum would -1 on the next cycle low due Tuesday. Back to the stock market, if the 8 day cycle adjusted by a half to 12 for the top, then it would seem right that the 8 day cycle low would adjust by a half to 12 days also. If Monday was the 8 day cycle low -2 days, then Tuesday would also be 8 days -2 days from Monday. Bottom line: I hate to beat the same old drum mantra , but I'm still bearish and now beyond Monday and into Tuesday. SPX 658/660 is support for Tuesday. GDX support is 25.30 Tuesday, but if that breaks we're looking at 24.00. Today is day 4 off of Monday's low and may be lending some support to the stock market. I don't think the down side is over just yet for both precious metals and the stock market. We remain short both PM and SM funds and ETF's.

Bottom line: I hate to beat the same old drum mantra , but I'm still bearish and now beyond Monday and into Tuesday. SPX 658/660 is support for Tuesday. GDX support is 25.30 Tuesday, but if that breaks we're looking at 24.00. Today is day 4 off of Monday's low and may be lending some support to the stock market. I don't think the down side is over just yet for both precious metals and the stock market. We remain short both PM and SM funds and ETF's Thanks for the update Blu! Take Care.

Edited by robo, 27 February 2009 - 11:35 AM.

This morning, the SPX broke its November low by 6 points (735) and has since stabilized in the 744 area. The 8 day cycle low due Feb 25th came 2 days early on Monday. The normal 8 day cycle top came yesterday on day 12 (another one of those pesky cycle and a half adjustments we've seen a lot of lately). Overall, I believe we are in 'c' of "c" of the final wave down for this sequence. Of that wave, I can make the case for wave 1 and now wave 2.

The precious metals moved up today, 8 day cycle top for the PM stocks (0), 4 day cycle top for gold (+1) and silver (0). The 39/45 day cycle turn for silver/gold can invert and instead of being a low it can be a top. For gold it was day 39 on the top and silver day 40.

Another measure I do to determine cycle lows is to see where 2 rising trend lines (bottoms and tops) converge and for GDX they bisect Tuesday next week. For GLD the up trend line and former top bisect at 871 Tuesday (POG 886/887). Yesterday's GLD/SLV low was +1 on the 4 day cycle low, meaning the minimum would -1 on the next cycle low due Tuesday.

Back to the stock market, if the 8 day cycle adjusted by a half to 12 for the top, then it would seem right that the 8 day cycle low would adjust by a half to 12 days also. If Monday was the 8 day cycle low -2 days, then Tuesday would also be 8 days -2 days from Monday.

Bottom line: I hate to beat the same old drum mantra , but I'm still bearish and now beyond Monday and into Tuesday. SPX 658/660 is support for Tuesday. GDX support is 25.30 Tuesday, but if that breaks we're looking at 24.00. Today is day 4 off of Monday's low and may be lending some support to the stock market. I don't think the down side is over just yet for both precious metals and the stock market.

We remain short both PM and SM funds and ETF's.

Blu, thanks for the continued updates...Best of trading to you

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sorry for the post...wrong thread. I added this to my other thread as well