Folks,
Market Observations for the Week: The SPX rallied hard today into the 9/9-9/12 Full Moon Timing Window and the key CPI report early Tuesday. Our TRIN-5 indicator printed a second SELL SIGNAL at the very overbought level of 3.0 on Monday’s close which is a SELL SIGNAL. We are expecting big volatility in this week’s quad-witching and it could start Tuesday if the inflation numbers come in hotter than the “inflation has peaked” crowd expects. AAPL closing above 155 on Friday’s close was a bullish tell for the market on Monday but our Option Premium Ratio indicator has given us back-to-back values of 1.51 which is a SELL SIGNAL. Bitcoin holding above 22000 overnight Sunday was a bullish tell for the SPX on Monday. Crude oil rallied in 5-waves into Monday’s Full Moon Timing Window and that gave the oil stocks a boost today. The USD gave us an EW 5-waves down below 108.33 and that is a SELL SIGNAL that could help commodities move higher.
9/12/22 (Commentary for Monday) The SPX rallied into the Full Moon Timing Window and into Tuesday’s early CPI report. Sell signals from our TRIN-5 indicator and Option Premium Ratio indicator have us looking for some downside volatility after the CPI inflation report as we expect some hotter than expected numbers. Our TRIN-5 indicator gave us a second consecutive SELL SIGNAL as it hit the very overbought value of 3.0. Bitcoin rallied above 22000 Sunday night which was a bullish tell for the SPX On Monday. Crude oil gave us 5-waves up into the Full Moon Timing Window on Monday – just a 3-wave pullback is bullish for a run above $88. The USD gave us 5-waves down below 108.33 which is a SELL SIGNAL and that should help boost gold, silver and other commodities. Our current holdings are ~80% cash and ~20% in physical gold/silver/platinum.
Big Picture on Stocks (UPDATED) – AAPL’s huge rally on Monday helped give the SPX a big day but traders are over-confidant going into tomorrow’s CPI inflation report. Longer term, the SPX could give us a 20%-50% correction by spring 2023 as the 20-yr cycle low bottoms and the US economy slows to a recession. We favor a high percentage of cash for capital preservation.
Big Picture on PMs (UPDATED) – Gold tagged $1747 on Monday before reversing down. Central bankers are loading up on gold this year as global physical inventories continue to decline.
- Stocks – AAPL’s blowout day kept the SPX elevated but a SELL SIGNAL from the Option Premium Ratio and a second SELL SIGNAL from the TRIN-5 indicator today have us looking for downside after tomorrow’s CPI report.
- Gold – Gold may have finished an EW a-b-c correction today and is rolling over.
- Silver – Silver tested $20 before correcting and got a big boost from the declining USD.
- Crude Oil – Crude oil spiked to test $88 today before correcting – a break above $88 would be bullish.
- Dollar Index – The USD broke below 108.33 and gave us 5-waves down and a SELL SIGNAL that should benefit commodities.
TURNING POINT DAY
The turn window for this week is 9/12-9/13.
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