Category: Insights

Dow Theory Update for July 15: Transports, once again, refuse to confirm higher highs

posted on: July 15, 2013

Primary bear market for stocks still in force until Transports confirm. Let’s get started with our Dow Theory commentary for today. Stocks The SPY, Industrials, and Transports closed up. As you can see on the chart below, the Transports have not bettered the last recorded highs (blue horizontal line) yet, and, accordingly, as explained here, […]

Dow Theory Update for July 12: Dissecting GDX and SIL’s secondary reaction

posted on: July 12, 2013

I am writing before the close, so I cannot provide you with closing figures. If the Transports exceed their 05/17/2013 closing high, then a primary bull market would be signaled, as both the SPY and the Industrials broke up their respective closing highs yesterday. More about such breakup, and the relevant chart here.If GLD and […]

Dow Theory Update for July 11: Stocks missed primary bull market signal by a hair

posted on: July 11, 2013

Secondary trend for GDX and SIL turns bullish Good article on Seeking Alpha concerning negative GOFO Dave Kranzler penned an interesting article “What GOFO is and Why it’s now very bullish for gold”. In a very straightforward manners he makes clear that there is an acute shortage of physical gold, and that past occurrences of […]

Dow Theory Update for July 10: Dissecting the current secondary reaction in stocks

posted on: July 10, 2013

Stocks take a breather. Precious metals languish Yesterday I announced the secondary trend of the market had turned bullish. This is tantamount to saying that there is an ongoing secondary reaction against the primary bearish trend. Well, let’s dig deeper into it. As I wrote here, please bear in mind that appraising secondary reactions […]

Dow Theory Update for July 9: Stocks close to breaking the last recorded highs

posted on: July 9, 2013

Possible change of trends for stocks at hand Gold GOFO rates turn negative Zero Hedgereports that GOFO rates have just turned negative. As the article explains, it is difficult to isolate “in real time” what caused this dislocation. However, irrespective of the specific cause, a negative GOFO indicates that something is wrong with the gold […]

Dow Theory Update for July 8: Stocks closed up. Primary trend remains bearish

posted on: July 8, 2013

Richard Russell on the importance of market timing Richard Russell, of the “Dow Theory Letters”, recently nailed it when he wrote “And it’s also a matter of timing. The graveyards of Wall Street are filled with brilliant men who were right too soon.” I couldn’t say it better in so few words. What separates winners […]

Dow Theory Special Issue: Secular trend versus long term trend

posted on: July 5, 2013

Case in point GOLD Followers of this Dow Theory blog know I am quite skeptical as to investing along the secular trend. My post “Fundamental versus Technical analysis and Dow Theory. Who is right?” highlights the risks pertaining to investing along the secular trend. When I refer to “secular” trend, I mean trends lasting at […]

Dow Theory Update for July 5: Precious metals listless. Trends unchanged

posted on: July 5, 2013

Stocks closed up Great article on the advantages of market timing Those skeptical as to the benefits of market timing, and its ability to increase slightly profits while drastically reducing drawdowns versusbuy and hold, are advised to read “Timing Method Performance Over Ten Decades“, penned by Mutual Fund Observer. The article delivers a breakdown of […]

Dow Theory Update for July 3: No change in trends

posted on: July 3, 2013

I am writing these words almost two hours before the NY close. From what I see on the charts, there are no changes in trends. Tomorrow I will provide a more ample Dow Theory commentary. Stocks The primary trend and secondary trend is bearish for the reasons explained here, and further explained here. I cannot […]

Dow Theory Update for July 2: Deflationary forces in action

posted on: July 2, 2013

Precious metals and stocks closed down Today is going to be a short Dow Theory commentary, as there are no relevant events. Stocks The SPY, Industrials, and Transports closed down. The primary trend and secondary trend is bearish for the reasons explained here, and further explained here. Today’s volume was higher than yesterday’s, which has […]

Dow Theory Update for June 28: Precious metals rebound or a dead cat bounce?

posted on: June 28, 2013

Primary and secondary trends unchanged. Let’s get started with our Dow Theory commentary for today. Stocks The SPY, Industrials, and Transports closed down. The primary trend and secondary trend is bearish for the reasons explained here, and further explained here. Today’s volume was much higher than yesterday’s, which is bearish as volume expanded with declining […]

Dow Theory Update for June 27: Paper gold melting down

posted on: June 27, 2013

Stocks rally on weak volume Time to buy the junior gold miners ETF GDXJ? Mebane Faber of Mebane Faber Research has penned an interesting article named “What happens when you buy assets down 80%”. In the article she analyses the subsequent 3 years return when you buy a sector, industry or country that has declined […]