SPX Monitoring purposes; Covered 12/30/16 at 2238.83= gain .46%; Short on 12/29/16 at 2249.26.
Monitoring purposes GOLD: Long GDX on 12/28/16 at 20.25.
Long Term Trend monitor purposes: Short SPX on 1/13/16 at 1890.28
Today the SPY pushed to a new short term high and the VIX made a higher low, setting up a divergence. This divergence will go away if the SPY continues higher and the VIX breaks to a new low. Notice that the SPY is making a third time higher since December. This “Third time up” could be a “Three Drives to Top” pattern which would have a minimum downside target to where the pattern began (in this case a decline to 223 on the SPY). The TRIN and TICKS should develop a bearish setup if indeed the market is heading into a top. Notice that it took a little over two weeks for each of the miner two previous highs to develop and there is symmetry in markets and may take this potential “Third high” two weeks also and give a target near February 7 to complete the third top. We also talked about the DJI getting over 20K before at top is realized and the DJI hasn’t reached that level yet. Covered 12/30/16 at 2238.83 = gain .46%; Short on 12/29/16 at 2249.26.
The bottom window is the Bollinger Band Width. As you can see the Bollinger Band Width has stayed below 30 since mid December and the previous two times when this developed the market was not far from a top. With the Bollinger Band Width staying this long below 30 suggests another top is nearing. While the “Three Drives to Top” on the SPY may not meet all the requirements the NYSE Composite is fulfilling these requirements and when the NYSE Composites tops so will the SPY. We are thinking one of the triggers for a top is for the DJI to close above 20K. Staying neutral for now.
The above chart is the bullish percent index for the Gold Miners index. The bullish percent index measures the percent buy signals generated by the point and figure method. Last week the Bullish Percent index stood at 46.43% of the stocks in the Gold Miners index where on Point and Figure buy signals. This week jumped up to 50% buy signals on stocks in the Gold Miners index showing this index is still getting stronger suggesting this rally is not done. The most like target is the previous high on GDX which is up near 31.00 range. This target may change as the situation changes. Long GDX on 12/28/16 at 20.25.