Gold Has Further To Fall!
Saturday, June 23, 10:30 a.m. I caught a bit of static when gold rallied back above $1,600 an ounce just after my recent bearish article on gold appeared. But the consensus of the 35 indicators we use to time gold, remained on the February 29 sell signal, and gold had only rallied back up to [...]

Saturday, June 23, 10:30 a.m.

I caught a bit of static when gold rallied back above $1,600 an ounce just after my recent bearish article on gold appeared.

But the consensus of the 35 indicators we use to time gold, remained on the February 29 sell signal, and gold had only rallied back up to the overhead resistance at its 30-week moving average again.

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And sure enough gold fell back below $1600 this week.

Our original downside target was $1,500 an ounce, which shows more clearly on the short-term chart. But the buy the dips crowd has extended the decline, with potential support now lower, approaching $1,450.

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To see my reasons for still being bearish on gold (but long-term bullish so expecting a new buy signal at some point), see my recent column  What’s Wrong With Gold- June 8, 2012.

Stock market’s next hope is next week’s EU summit – but.

The stock market’s next hope is now being touted as next week’s European Union summit meeting.

But the headlines in this morning’s Financial Times are:

“Leaders At Odds Over Intervention”, and “Rome Summit Ends In Discord.”

The article goes on to say, “The leaders of the euro-zone’s four largest economies, Germany, France, Italy, and Spain, met in Rome yesterday to demonstrate a coming together before next week’s EU summit, but ended in disagreement over the need for short-term markets intervention, and how to achieve greater political and financial union.”

Well, there’s a surprise, huh. European leaders still at odds over not only how to try to kick the crisis down the road further, but whether they should even try.

Did global market rally run into a wall at 50-day m.a.?

As I noted in my weekend newspaper column, it wasn’t just the U.S. market that saw the rally of the last two weeks at least pause at the key 50-day m.a.

It seems remarkable how the market’s technical conditions, even something as simple as a moving average, can be predictive. Although, perhaps not surprising given how many thousands of market technicians are employed by major institutions, including money-management firms, hedge funds, mutual funds, brokerage firms, pension funds, etc., and watch the same indicators to warn their traders and managers when key levels may have been reached.

In any event, as I noted in the column, it wasn’t just the U.S. market that saw the rally of the last two weeks at least pause at the key 50-day m.a.

Just a few examples:

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To read my weekend newspaper column ‘Major Market Hopes Were Dashed – What Now?’ click here.

Subscribers to Street Smart Report: There is an important hotline from Thursday evening in the subscribers’ area of the Street Smart Report website. And please stay tuned to the hotline going forward! An in-depth ‘Global Markets’ update will be on the SSR website on Monday. And the next issue of the newsletter will be out on Wednesday.

Yesterday in the U.S. Market.

A mostly positive day, with the Dow recovering about 25% of its big decline of Thursday.

Something very strange happened after the apparent close at 4 p.m. Volume on the NYSE at 4 o’clock was about 0.8 billion shares traded, and the Dow was shown up about 78 points. But there was apparently a ton of ‘execute on close’ orders that took them quite awhile to process. They were still reporting trading volume rising 15 minutes after the close. The changes ended at 4:15, showing a big 1.6 billion shares traded, 0.8 billion of it apparently at the close, and the Dow had dropped about 10 points to close up 67 points rather then the 77 points shown at 4 o’clock.

The Dow closed up 67 points, or 0.5%. The S&P 500 closed up 0.7%. The NYSE Composite closed up 0.7%. The Nasdaq closed up 1.2%. The Nasdaq 100 closed up 1.1%. The Russell 2000 closed up 1.4%. The DJ Transportation Avg. closed down 0.8%. The DJ Utilities Avg closed unchanged.

Gold closed up $6 an ounce to close at $1,571 an ounce, but down $53 for the week.

Oil closed up $1.81 a barrel to $80.01 a barrel.

The U.S. dollar etf UUP closed down 0.2%.

The U.S. Treasury bond etf TLT closed down 1.3%.

Yesterday in European Markets.

European markets closed down again. The London FTSE closed down 1.0%. The German DAX closed down 1.3%. And France’s CAC closed down 0.8%.

Global markets for the week.

Mixed markets globally this week, but gains in Europe were fractional.

Thanks to the two-week rally, the previous negative weeks no longer show in our three-week synopsis.


THIS WEEK (June 22)
DJIA12640- 1.0%
S&P 5001335- 0.5%
NYSE7616- 0.6%
NASDAQ2892+ 0.7%
NASD 1002585+ 0.5%
Russ 2000775+ 0.5%
DJTransprts5083- 0.2%
DJ Utilities472- 2.3%
XOI Oils1,115- 3.0%
Gold bull.1,571- 3.3%
GoldStcks156- 4.8%
Canada11435- 0.8%
London5513+ 0.6%
Germany6263+ 0.6%
France3090+ 0.1%
Hong Kong18995- 1.2%
Japan8798+ 2.7%
Australia4093- 0.3%
S. Korea1847- 0.6%
India16972+ 0.1%
Indonesia3889+ 1.9%
Brazil55438- 0.7%
Mexico39071+ 3.5%
China2367- 2.0%
LAST WEEK (June 15)
DJIA12767+ 1.7%
S&P 5001342+ 1.3%
NYSE7663+ 1.5%
NASDAQ2872+ 0.5%
NASD 1002571+ 0.5%
Russ 2000771+ 0.3%
DJTransprts5091+ 0.6%
DJ Utilities483+ 1.0%
XOI Oils1,150+ 2.2%
Gold bull.1,624+ 2.0%
GoldStcks164+ 1.2%
Canada11524+ 0.2%
London5478+ 0.8%
Germany6229+ 1.6%
France3087+ 1.2%
Hong Kong19233+ 3.9%
Japan8569+ 1.3%
Australia4107- 0.1%
S. Korea1858+ 1.2%
India16948+ 1.4%
Indonesia3818- 0.2%
Brazil55844+ 2.9%
Mexico37751+ 1.1%
China2416+ 1.1%
PREVIOUS WEEK (June 8)
DJIA12554+ 3.6%
S&P 5001325+ 3.7%
NYSE7553+ 3.6%
NASDAQ2858+ 4.0%
NASD 1002559+ 4.1%
Russ 2000769+ 4.3%
DJTransprts5062+ 3.1%
DJ Utilities478+ 3.1%
XOI Oils1,125+ 4.9%
Gold bull.1,593- 1.9%
GoldStcks162- 0.4%
Canada11500+ 1.2%
London5435+ 3.3%
Germany6130+ 1.3%
France3051+ 3.4%
Hong Kong18502- 0.3%
Japan8459+ 0.2%
Australia4111- 0.1%
S. Korea1835+ 0.1%
India16718+ 4.7%
Indonesia3825+ 0.7%
Brazil54276+ 1.5%
Mexico37320+ 0.3%
China2389- 3.9%

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Next week’s Economic Reports:

After two quite light weeks, next week returns to being a heavy week for potential market-moving economic reports, including another revision of 1st quarter GDP, New Home Sales, Consumer Confidence, Durable Goods Orders, Chicago PMI, etc. To see the full list and times for each release click here, and look at the left side of the page it takes you to.

This past week’s reports were mostly more of the same dismal variety of the last several months, providing further evidence that the economic recovery is still stumbling, including declines in housing starts and existing home sales, as well as that dramatic plunge in the Philly Fed Mfg Index to minus –16.6 in June, and the latest dismal PMI reports from China and the euro-zone.

To read my weekend newspaper column ‘Major Market Hopes Were Dashed – What Now?’ click here.

Subscribers to Street Smart Report: There is an important hotline from Thursday evening in the subscribers’ area of the Street Smart Report website. And please stay tuned to the hotline going forward! An in-depth ‘Global Markets’ update will be on the SSR website on Monday. The next issue of the newsletter will be out on Wednesday.

I’ll be back with the next regular blog post on Tuesday morning at 9:25 a.m.

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