The Ultimate Market Analysis: SPX Short, GDX Long, and Signals for Success
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SPX Monitoring purposes; Short SPX on 7/31/24 at 5522.30. Our Gain 1/1/23 to 12/31/23 SPX= 28.12%; SPX gain 23.38%. Monitoring purposes GOLD: Long GDX on 10/9/20 at 40.78.
Long on April /12; sold long July/12 gain 10.30%; up over 15% this year so far. The top window is the 10-day average of the TRIN and below that is the SPY chart.
We noted in shaded pink the times when the 10-day TRIN reached 1.20 and higher suggesting that level had panic and panic only form near lows in the market. The current 10-day TRIN stands at 1.03 and needs to approach 1.20 or higher to signal a bottom is forming.
SPY declined over 2% on July 24 (last Wednesday); 2% declines usually come in clusters suggesting another 2% decline will show up soon. We noted in shaded light green when the TRIN reached near 1.19 and higher suggesting this area had panic and panic only forms near lows.
This shaded green area could produce a low in the market if the 10-day TRIN reaches near 1.20 or higher (the current reading is 1.03 and not bullish). Today’s trading tested last Wednesday’s down gap on lighter volume suggesting last Wednesday’s gap has resistance.
Bigger trend remains bullish and new highs may be seen later this year. Short SPX on 7/31/24 at 5522.30.
The bottom window is the weekly cumulative up-down volume and the next window higher is the weekly GDX advance/decline. Bullish signals are triggered when both indicators close above their mid-Bollinger bands (noted with blue lines).
We noted on the chart above how long the buy and sell signals lasted. The last signal (before the current buy signal) was triggered in January 2021 and lasted until March 2024 (over 3 years).
The current weekly buy signal was triggered in March of this year. Signals of this type last at a minimum of 1 ½ years.
Adding one and a half years to the March 2024 buy signal will give September 2025; again at a minimum but could last much longer.
In conclusion, the market is showing signs of potential downside with the SPX short position, but the bigger trend remains bullish with opportunities for new highs later in the year. Keep an eye on the TRIN levels for signals of market bottoms and tops. Stay informed and make the most of your investments with these insights.