Just a quick but important update here: I’m not happy with the way gold and silver are acting. Gold has sold off to its current $1,257 level (December futures) – dangerously close to taking out the prior low at $1,243.20 on October 7, which was a perfect test of price and time.
Should gold break that low and close below it, we may be looking at a cycle inversion where late December would create a low instead of a high. Ditto for other metals and for mining stocks.
There’s nothing to do right now but be patient and hold all existing positions. If a cycle inversion is on its way, I will recommend bearish positions to take advantage of a move lower, which could find gold falling to new lows early next year … even to below $1,000.
As for the stock market, the slingshot move higher of roughly 1,300 Dow points low-to-high during and after the election tells you the Dow is definitely headed higher.
But, slingshot moves almost always get fully retraced. And unless the Dow can close above 18,500 at the end of this month, it has not yet broken out. It is, however, eating away at overhead resistance.
In other words, as strong as stocks look, don’t jump in. You’ll be sorry. In the meantime, hold the bearish stock ETFs. Also hold your shares in AK Steel, which are up smartly, over 32% in just seven days.
Best wishes,
Larry
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