Key Developments In The Financial Markets
Stocks continue to consolidate. And Gold tests key breakout level.
Tuesday’s stock market rally helped to add some conviction to the idea that stocks can move higher in the short run. The major indices managed to successfully close up near the highs of the range, vs failing and closing lower like the prior two days.
Today we are giving back some gains and the S&P 500 is showing a minor trend break, but nothing too damaging. Stocks should continue to consolidate into tomorrow before turning up, as long as 2600 holds.
Elsewhere, commodities are turning up sharply. GOLD has been on my buy list for some time and it’s testing key “breakout” price resistance again.
It’s still volatile out there, so active investors need to remain patient, yet disciplined in their approach.
S&P 500 Chart Analysis
As long as S&P 500 futures remains above 2615, there’s good risk/reward over the near-term. A move under 2600 would change this scenario.
Overnight weakness has not damaged the consolidation structure. I’m expecting S&P 500 to bottom out today/tomorrow and turn higher once more. 2672-7 remains an area of upside importance (and resistance). A breakout above this level would mean risk-on for a few days.
Gold Chart Analysis
GOLD is quite attractive as yields and the Dollar are falling. Gold prices are now getting back up to test key resistance. A test of this 1365 area looks likely and a move over this level would result in a very sharp rally in the metal, potentially as high as the 1550 area in days/weeks ahead.
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Author has positions in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
