Saturday, August 5, 11:10 am EST. Friday was ugly. It was ugly, and rather painful.
Let’s chart everything, and take a look. Everything declined. All of ’em. There’s a line of support I had long ago drawn on each chart. How many were challenged? How many held? How many were broken? How many weren’t even challenged or threatened?
Support not challenged: RGLD, SGDM, ABX, GLD, GDX, SLV, WPM, PAAS, SILJ, PVG, and NUGT.
Support challenged, but held: SSRI, HL, FSM and CDE.
Support broken, we’ve got a problem: AG.
My impression now, is that the situation is not as bad as I had first thought or feared. So, what of volume? Volume expanded to be some 22% above the average. That is not insignificant, as it has often been running well below average for a long time now. There was a lot of selling, but it was not a rout or panic.
What of the average chart for all 16 symbols. Easy call. I made it earlier. Price had come right up and bumped its head on the declining-sloped resistance line I’d drawn from the 11/9, 2/8, 4/13, and 6/6 tops. The latest was on 8/1. The 7/26 pop in price, that gave me the reason to commence a “rally count,” meaning, will it take off an advance within the subsequent 4 to 7 trading days, is now officially dead, and off our radar. This market needs to reset.
It is time for me to catch the timer up with all the recent data, and interpret the technical measures of market risk that it generates. If we are blessed, it may, once again, signal a lo-risk market entry opportunity. If it does, and I should learn of outside confirmation from others watching this same market. I’ll call that opportunity, and get on board with small position at first, to be followed by a bigger commitment, should I see it confirm.
Here’s to your accumulation of real wealth!
Harold F Crowell