With respect to the recent analysis noting the downside gaps that could fill in the short-term (before any resumption of the relief party, if applicable this year) here are daily charts of the three most major US stock market indexes…
SPX filled its gap yesterday and as noted in the run up to this point it now should hold a higher low to the November 3rd low of 3698 on a daily closing basis if the seasonal rally is to stay intact.
NDX is filling its gap today and should hold a higher low to the November 4th low of 10632 in order to stay on plan.
DJIA has a small gap way down near 31000 that I would not expect to fill unless the indexes above break down. But as for its key juncture, that is right here at the convergence of the moving averages. On that note, not surprising that the index dropped immediately after signaling a ‘bullish golden cross’. Perfect, and as usual.
Bottom Line
We have been managing the Q4-Q1 sentiment/seasonal relief rally since mid-October. Nearing the end of Q4 the rally is still intact, but the indexes have declined to points we’ve allowed for and those points will either confirm the rally or likely end it, if they break down.
@Gary, we know you hold a large cash percentage for some time now. And that has proven a wise choice. However, to put this in perspective we need to have an idea of what percentage you plan to put at work once you think the (pm) sky has cleared i.e. when you think the next leg up is about to start i.e. when the market is resolved Thanks for sharing.
I don’t know ahead of time, Bart. Depends on what kind of bull move it is and what its funda backing will be (or not be, but I see the funda coming around very well). Even then, I’m not going to throw a number out there ahead of time. You’ll see my holdings and cash % each week. Oh, plus words. Let’s not forget words. I write a lot of them and will surely talk in detail about the miners and associated allocation.
I believe we have a chance (CHANCE) at a major move in the gold miners in ’23. Where the sectors macro funda marry my TA for a rough HUI target of 500. If so, I’ll talk a lot about the sector as a primary focus (finally!)
OK great Gary. Thanks.