SPX Monitoring Purposes: Long SPX 1/29/21 at 3714.04
Monitoring Purposes GOLD: Long GDX on 10/9/20 at 40.78.
Long Term SPX Monitor Purposes: Sold long SPX on 1/15/21 at 3768.25= gain 10.80%; Long SPX on 10/26/20 at 3400.97.
Today, the SPX/TLT closed above the 1/26 high while SPX is still below. It's common for the SPX/TLT ratio to lead the SPX. This condition suggests that the SPX will close above it 1/26/21 high, which is 3870.90 in the coming days. Today the TRIN closed at 1.92, which is a rare reading for the market being up. A TRIN reading near 2.00 usually comes when market is down a good degree. We take the 1.92 TRIN close as a bullish sign for short term. Long SPX 1/29/21 at 3714.04.
The market is not setup for a large decline here. Markets weaken first before a large decline can take hold. In the above chart, we pointed out the times when the McClellan Summation index falls below "0" are when it's possible that a large decline can occur. The NYSE Summation index stands at +687.84 and is at very bullish level. We are expecting a trading range to develop in the current timeframe and this potential trading range may produce weakness in the Summation index, where a large decline could develop in the coming weeks. There is a cycle high due in March (just like last year) that could produce a worthwhile decline. For now, the market appears to be on solid footing.
Above are two indicators that have worked well in the past. The bottom window is GDX Advance/Decline with an 18-period moving average, and the next window above is GDX Up Down Volume with an 18-period moving average. When both indicators reach below -20, GDX was near at least a short-term low. Both indicators did close below -20 the last couple of days. Most good rallies start when traders give up on the long side and both of these indicators suggests that is happening now.