Yesterday we planned out the first short-term target on SPX as the area surrounding 2060, which had been bounce resistance in October and is so again. Let’s expand ‘surrounding 2060’ to 2060 to 2080. If SPX is going to hit the SMA 200 at 2064, why not fill the gap at 2080? That is also an area of lateral overhead resistance.
The target for Europe continues to be 3600. Support to this scenario is very clear at 3250 to 3300.
I am seeing a lot of talk about over-sold gold preparing to bounce. Unfortunately, some of that talk from relatively sophisticated market watchers has included the terror bid in gold’s case. That is almost always a sucker’s bet. The question on gold is whether or not it was preparing to bounce anyway, before the terror attacks. It certainly was over sold enough to do so and the price was back to the July low.
It was actually a positive that gold did not receive much of a pump on Paris. So backing out all of that stimuli, the best we can say is that gold is a candidate to bounce.
Its Commitments of Traders situation continues to improve.
While that of Silver still had more work (as of 11/10/15) to do in its new trend toward repairs.
If the sector were to bounce, GDX could make it to 14.50, which was important pullback support that failed early in the month.
I decided to take the rest of my profits on US stock market shorts yesterday, due to the brewing contrarian bullish sentiment re-set provided by the terror attacks. I will look to reestablish those on this bounce. I held the EM short (EEV) however, and the chart of EEM shows the tolerance on that.
Finally, Crude Oil caught a big bid yesterday but is very bearish below 44 and just plain old bearish below 46.
Just a few items for your consideration as the markets deal with the aftermath of an inflammatory geopolitical event.