NFTRH; Technical status of US stocks & precious metals [w/ edit]

Here is the snapshot a couple minutes before 6:00 US Eastern. What I see here is the relatively weak SPX and especially Dow and the relatively strong Nasdaq. That has been a consistent theme for a long while now. People are talking bearish about the market’s valuations, but growth and Tech continue to out perform even during crisis times.

That is very interesting and it means something because sure, it would be normal for Tech to have been leading into the bubble top (as we noted all along) but during crisis? Why didn’t that leadership implode? It’s a question we need to keep on the front burner going forward.

Back to our oft-used pre-market ‘projected open’ view for SPX. It’s nearly the same as last time (2794) we updated on April 15. SPX is a gap fest with a couple above luring this sentiment relief rally and a couple below waiting for the rally’s expiration. The rally has paused at best or terminated at worst at a logical point, which is the 50 day average. The rally is technically intact. It’ll likely fill the gap and maybe test support around 2725.

I don’t love that support, however. It was better formed as resistance than it is as support because its touch points were from the upside not the downside. It does coincide with the short-term EMA 20, which is a positive. It would be best for the rally for SPX to fill the gap and then get about its business or our current high risk status would tick up further and a failure of the EMA 20 could cook the rally.

spx

We covered daily HUI in NFTRH 599, but to review it is fine anywhere above the moving averages and noted support. As it is, yesterday it held the short-term support (not drawn in) noted in #599. This morning gold and silver are negative so it will be interesting to see how Huey reacts.

hui

Here is gold’s live status this morning. It is down over 22 bucks and yet holds the shortest-term support, which is the top of the bullish pattern. As we’ve noted, it can drop to 1629 (SMA 50) and still be fully intact and bullish. But again, it’s still at the key short-term support in pre-market.

gold

In #599 we took a look at a short-term support shelf for silver and this morning it is testing that support. As with SPX above, it is pulling back from the SMA 50, which is logical. I continue to think that a surge to test the SMA 200 (16.99) can easily come of this pullback. But let’s let silver decide. There is a ton of resistance surrounding 17 and that may not be easily overcome.

silver

Meanwhile, the 14 level remains critical because that is the level that was violated, activating a target of 8.30 per long-term support before a classic whipsaw reversal drove the price back above it. Precious metals often end corrections on such whipsaws. Take a look at silver’s dual whipsaw lows [edit: at the end of 2008], for example.

silver