As you know, we are watching for the potential of A-B-C bull market corrections in both the gold mining indexes/ETFs and in some broader market indexes/ETFs. SPX being a prime example. Let’s focus on it in this update.
With the war noise in the background, I have decided for now to just remain steady with long positions offset by relatively minor partial hedging. As noted in today’s market notes, I did take a handy profit that was presented very quickly in HIMX. But generally, I am holding diverse items and trying to stay balanced. Interestingly, the items that had benefited the most on war seem to be weakest. But again, balance for now.
If SPX is making an A-B-C correction, it is now on ‘B’ up. Assuming this view is correct, ‘B’ up could be put in as high as 6777 or so. If that happens I’ll wish my crystal ball was not in the shop for repairs and I would have taken solid profits on my remaining short hedges (SPXS and TECS). Alas, it was not to be.
But again assuming we are on an A-B-C correction (it’s theoretical), the 2025 correction advises that ‘B’ might not have that much further to go. RSI and MACD are doing similar things to the 2025 ‘B’ leg and that leg itself was fairly modest, not much stronger than what SPX has already put in. So I hold the hedges.
Now with Trump playing chicken with Iran and a deadline coming up the TACO may chicken out, he may win this “negotiation”, or disaster may unfold. Personally, I am not expecting him to chicken out this time. But once a TACO… ? Personally, I am leaning toward some kind of resolution the market will cheer, potentially popping to the noted resistance and the SMA 50 as “happy days are here again!”… before a final leg down that sells the news.
That is FAR from a firm view. So many balls are in the air. Hence, balance and patience. But the main points of this update are that as noted in NFTRH 909, a bounce is on. It will either play to the favored view of an A-B-C correction (B could be considered valid already), or just keep bouncing to negate the whole correction. That’s not favored, but not for a minute do I think it’s not possible.
