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TIMER DIGEST SIGNALS:
Stocks – NEUTRAL
The ability to hold Tuesday’s lows (for example, 1101.54 in the S&P 500) on Wednesday was impressive as was the fact we could rally as dramatically as we did yesterday! Volume, however, did not increase to the upside! Though I could see a rally try back up to 1230 or so in the S&P 500, I have chosen to remain on a Neutral signal because of my belief that we could still see new lows. However, if volume shifts back to the upside by virtue of my work generating broad-based Positive Leibovit Volume Reversals, I will have to re-evaluate this position. Is it possible we have already seen the correction (bear phase) lows? The answer is, yes, anything is possible, especially when the playing field is not level. But, again, I need more evidence. If that occurs, it would follow the ‘seasonal’ pattern of ‘Sell May and Go Way’ followed by a renewed buying opportunity in the Fall much as we witnessed last year following the ‘Flash Crash’.
Gold – BULL –
The ‘banksters’ are back at work along with the Plunge Protection continuing to implement their “RE” (Resource Easing) scheme to drive down commodity prices. This time the target was gold when the CME raised margin requirements. At the same time, I told you a pullback in Spot gold to 1683 was a likely technical event. That now appears to be underway. Afterwards, the sky is the limit, but we may have to patient as a short-term ‘cyclical’ peak which I have also forecast may now be in place. Please check with the VR Forecaster (Annual Forecaster Model) report for details.
Bonds – NEUTRAL –
Bonds retraced as would be expected and in my view confirm the rally in stocks and the pullback in gold. Bonds could very well rally again once the current stock market rally peters out.