Now that we got through a Monday without an air pocket, the coast is clear, right?
Not so fast. The market poked its head up out of the foxhole and lived to talk about the
Superstition “3 on a match”.
But the market is a soldier of the matrix and has many a trick up his perverse sleeve.
Wouldn’t it be just like that trickster we call the market to set a hook on Monday to be followed by a Turn Around Tuesday (to the downside).
While the SPX close above the 6050 pivot/square, the SPY closed within bounds at 604.85.
Jump Ball.
The SPX left an NR 7 Day suggesting whichever way we go it should be an expansion of volatility.
The tension is on the tape in this tight wire act.
On the one hand the SPX could trigger a little Rule of 4 Breakout on a push over a declining 3 point trend line from January 24 all time high.
On the other side, breakage below 6050 with follow thru opens the door to an attack of the 6000 level and the 20/50 day moving averages that have held for 5 sessions now ever since last Monday’s nosedive.
We’ve mentioned before in this space an uncanny synergy between the SPX and gold.
For example the 2011 peak in gold was at 1921 (a square-out as 1921 squares early Sept…the high in 2011.
However, 1921 also aligns with 666 and March 6th, the SPX Time/Price square-out at the 2009 low.
So the 2011 bull top in gold resonated off the SPX bottom in 2009.
I bring this up because GLD is on the threshold of what may be a meaningful square-out:
272 squares out with Feb 11.
GLD/gold has been rising since bottoming in December 2015.
Now all of a sudden it’s caught market participants attention as it is honing in on a glittering milestone: $3,000 gold.
Gold climbed to a record 2911 yesterday.
2911 squares Feb 11.
What are the odds that the price of GLD and gold both have Time/Price square-outs
The same day?
Above I mentioned that GLD has been advancing since December 2015.
The low in Dec 2015 was 100.23.
100 also squares February 11th.
Amazing.
As well GLD is hitting the top of a large trend channel.
Clearly the rally into the August 2020 peak was a Wave 3 of some degree.
The current advance since October 2023 mirrors the prior Wave 3.
A decline to 220/225 could easily play out. prior to new leg up.
August/September often mark highs in gold.
February is opposite August making it a logical time for an intermediate term peak.
I am not talking about the end of the gold bull market….but a prolonged setback that disabuses bulls of their belief.