Friday, October 26, 2007

Charts Of Interest

The US.Dollar continues to move lower which is helping many commodities such as gold and oil move higher.

EEM is much stronger than the S&P. If you look at the above chart, you will see that EEM is breaking out to new highs while the S&P has not made new highs. EEM, ILF and FXI are a few of the ETFs where money seems to be moving into.

Today gold and silver had a big move to the upside. Gold has been moving higher since August and I totally missed this entire rally. If you recall I have been very bullish on gold since last summer but unfortunately I was involved in a few other projects which caused me to miss being long this metal..Oh well...@&$#(!!@#%^#%

Those of you who follow Dow Theory might find the above chart of interest. Recently the S&P made a new high while the transportation index did not. According to dow theory that is bearish for the market and the market should trend lower. Keep in mind about a year ago there was a dow theory sell signal which failed to produce a sell off. I'm personally not trading based on the above chart..I just wanted to post this chart here because some of you might find it of value..


jack said...

I had tons of gold but sold it all between $720-730 based on super bearish COT. It has to go down at some point right?.
Looks like Oct 22 was a buying opportunity for equities, well I missed that.

Gary said...

COT sell signals are almost always early and are nowhere near as reliable as COT buy signals.

Actually what we have is a Dow Theory nonconfirmation which is only a warning not a sell signal. A sell signal will come if BOTH the industrials and the transports break below the Aug. 16th lows. Money flows are posotive in the transports though so I doubt they will break below the secondary low much less the industrials.

Kevin said...

Well said Gary...I agree with you on the COT signals and the Dow Theory sell signal needing more confirmation.

clarence said...

Many thanks to Kevin. My thoughts on are as follows. Conformation W/HUI resistance broken @ 400, backtest to bullish hammer 388 will add 80 points. Oil leading gold cup formation 52 to 78 W/handle gives projection to 102. Silver the lagger will catch up signficant resistance @ 13.97 broken 50 to 15 to 13.97 is line. Dollar lost contact @ .82 when on August 16th oil kissed 70 will now see .74 .


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