U.S. Stock Market – The Obama aura has disappeared and the majority of Americans now realize the magic carpet some thought he came into power on was just an illusion. In fairness to him, many of the staggering economic, social, political and spiritual problems facing America began long before he took office. Unfortunately, those who thought he could chip away at some of them are now concluding he’s only piling on.
This in turn has IMHO limited any upside in the stock market. While we can still managed to trade in the upper end of the trading range we’ve been in for a few months, I do think as fall approaches the upcoming elections will grip the market’s attention and the pressure will be to the downside.
U.S. Bonds – There’s going to come a day when despite a very weak economy and no real signs of inflation, bonds are going to look unattractive due to the enormous debt America has taken on and concerns of its ability to service it will come every bit as much as it did to some European countries earlier in the year. However, I’m out of the guessing game of when exactly that’s going to take place.
Gold – The July/August seasonally weak period for gold has played out this year and gold is just above some key support. There are likely numerous sell stops in the $1,180 – $1,185 area. A break below this level is likely to bring on a test of the 200-day M.A. around $1,140. While such an event would certainly give the gold perma bears some fodder to peddle to those who believe even a broken clock is right twice a day, I don’t believe it changes any long term objectives. In fact, if it occurs in a sharp wash out fashion, it could end up being a key intermediate bottom.
At the same time, if $1,185 holds, and the market then closes above $1,225 and especially $1,260, we would have put in a triple bottom and likely see acceleration to the upside.
I would sit on the sidelines for now and await either the $1,140 area or above $1,225 to buy.
U.S. Dollar – Where did all the dollar bulls go? The countertrend rally is over and the terminally ill Uncle Sam paper is resuming its death march.
Oil and Gas – No interest on either side.
Note – Tookie Angus took some serious change and picked up shares in Evolving Gold EVG is a client of Grandich Publications and I own 1.1 million shares as of today.
On Major Moves, Peter Grandich has been very right and not only saved many investors fortunes, but expanded them dramatically. On November 3, 2007 at the MoneyTalks Survival Conference, Peter Grandich of the Grandich Letter warned that “an unprecedented economic tsunami will hit American beginning in 2008”. Peter advised publicly to short the US market two days from the top in October, 2007 and stayed short until the last week of October, 2008. He began to buy stocks in March 7th, 2009. He also bought oil and oil related investments near the lows after the dive from $147.
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