A snapshot of the current technical status of key ETFs…
GLD filled gap, which now closes out the geopolitical hype and leaves gold on its own right at key support. Still not a constructive looking chart. A rise above the SMA 200 and then the 50 makes it constructive.
SLV lost the preferred support zone and now must find support above 18 to get constructive.
GDX pulled a whipsaw on Monday and Tuesday. Support is still intact and the pattern still looks suspect. A rise above the SMA 50 would be helpful to the miner case. The miners, unlike gold and silver have not closed the June gaps. Another note… weekly charts remain more constructive, but the ETF updates focus on the dailies.
GDXJ is similar.
SIL has in essence lost support but bounced from another less pronounced level of minor support. It is vulnerable below 13.75 to 14.00.
We reviewed Silver vs. Gold and GDXJ vs. GDX (both constructive for bottom making) in an update yesterday. Below is GDX-GLD, which has not stopped being constructive on this entire short-term correction.
DBC is bouncing where it had to bounce to keep alive any prospect of an ‘inflation trade’. Reference CCI commodity index critical big picture support at 500.
USO is trying to bounce after breaking down. Best resistance starts coming into play at 36.
UNG is trying to ‘W’ bottom below the moving averages. Key resistance is 24.
DBB had an original NFTRH+ measured target of 18.50, and after a healthy test of the SMA 50, it looks like it wants to go there.
DBA is locked in a firm downtrend.
URA dropped through support, tested the SMA 50 and bounced. A higher high above 15.75 would indicate an uptrend. First step is to get above 15.30 and nullify that lower high.
TIP-TLT does its DBC/SLV impression because like those two, it does not see inflation at this time.
TLT does not either, and remains in an uptrend.
SPY rose above all time high resistance in a move that probably surprises no one. Things in motion – especially in the markets – tend to stay in motion. Recovery volume is suspect compared to the volume that drove SPY down in July. The under side of the former Wedge breakdown is being tested.
QQQ is great aside from the fact that it is over bought by its proximity above the 50 day averages and is in a Rising Wedge. Yes it broke out to the upside, but these are often head fakes to get the max. number of chartists screwed up.
SMH popped above, and dropped below key resistance, speaking of head fakes.
EZU is bouncing to a spot that could be a new short setup at the converged moving averages (with a stop above said averages).
EWP, our Euro PIIGS representative, could find resistance at the SMA 50 or higher at visual resistance. This too looks like a re-short at or below 42 with a stop at to suit above 43.
FXI continues to work off an over bought status above support.
EEM is breaking to new highs.
Context on EEM by monthly chart and by its weekly chart in ratio to SPY. The monthly is breaking a key resistance level this month and setting sights on all time highs. The weekly ratio chart continues to be constructive for a bottom in EEM-SPY.
UUP hit the target and as projected, is quite over bought so far above the moving averages. RSI (not shown) is getting up to rally stopper levels (77.12) but UUP has momentum on its side.
Conversely, FXE is nearing a downside measurement.
Bottom Line
Precious Metals: Unchanged as they remain in a short-term correction within a potential bigger picture bottoming process.
Commodities: Unchanged and not indicative of an inflation play at this time. An exception is the base metals, which benefit from the global manufacturing environment, with China stable and the US in growth mode.
Stock Markets: The US is getting over bought again. If this bounce (which has gone higher than originally planned when we prepared for a bounce) is a suck in, the fallout would be something to behold. But the US remains bullish until it is not. It’s the whole ‘things in motion’ thing.
Globally, Europe looks to be bouncing to re-short levels. China 25 is fine and the EM’s are favored.
Currency: Uncle Buck is at target and over bought. Everyone now knows it’s bullish. Similarly, everyone knows the Euro is bearish. There is a counter trend play setting up where the USD can decline and the Euro can bounce, but USD is bullish and Euro bearish beyond said bounce, if it occurs.
