Stock indexes were up today and gold was off a bit. Volume was very light due to the Jewish holiday. I am showing only the Dow ETF today as that was by far the strongest index, due to better than 3% moving in both GM and McDonalds. Today prices gapped up into the lower error band, and well above the three day pivot (yellow dot). The green dot on the price bars is the same as the dots on the indicator in the middle sub-graph. There has been good follow through since the indicator crossed the signal line, thus creating the green dot. The structure of this market is starting to look more positive. There is an inverse head and shoulders formation in the adaptive CCI indicator in the lower sub-graph, and also evident on the price bars. The QQQQ still has a more positive structure (refer to chart on yesterday’s post – not much has changed today) and I still prefer longs in that index, although the upmove today didn’t carry through from the open as it did in the Dow.
Rate cut is expected next week, and should be fully priced into the market by now. Quad witching next week as well.
The gold market tried to sell off today, but everytime it went down buyers stepped in to push it back up. It did settle down about $3, which isn’t much after the straight up move. Another test of recent high could pull trend chasers in, and then the shake out could occur. The gold market can be insidious.