Friday, May 30, 2014

ImageAnother look at gold through GLD, the SPDR Gold ETF chart. The recent post last week held on to the bullish belief that GLD would find an intermediate bottom, but that belief is hanging by a thread as GLD took a leg lower instead, and it is currently testing the daily TDST Support level at 120.73. Since TD Buy Countdown @13 did not respond as a GLD bottom, TD Combo Buy takes its place, and it has been notated one count short of a “13”. To achieve a TD Combo Buy “13” today, GLD must register a lower low from 120.77 and close no higher than 120.94. However, this will place GLD under TDST Support. This will be acceptable to keep the bull case alive, but there will be a serious consideration to cut out if there are two consecutive lower closes under the daily TDST Support at 120.73. There is no chart presented, but it’s worth noting gold futures hit a TD Buy Countdown @13 two days ago and trading above TDST Support at 1251.80. It is in the same predicament as GLD from a TD perspective. Longer term, GLD appears to be bottoming from the December 2013 lows. 

The weekly charts are included today and the monthly charts will come next week. At the close of today, it is likely all short and long term timeframes for the major indices will be bullish. Even with a rally that is characterized by low volume and low breadth, prices can still levitate. Tom DeMark’s TD Sequential is known for market timing, but the most underrated component is the power it holds as a risk management tool. It gives defined levels of when to stay in a trend, when to exit, and when to be cautious. Right now, equity markets are bullish and everything will be measured again next week. 


Flip to neutral if SPX closes below 1909.64. 

ImageThe 4 hour TD Sell Setup is still active, indicating that liquidity is still there. 


Flip to neutral if SPX closes below 1900.53.

ImageEquity markets still look like they are squeezing higher. 


Back to neutral if SPX closes below 1878.48 next Friday on June 6th. 

ImageImageImageImageRECENT: The weekly SPX TD Sell Countdown “13” and TD Combo Sell “13”, recorded back on May 2nd, had a muted response.

CURRENT: The weekly volatility squeeze indicator, TTM_Squeeze, is pointing upwards for all major indices. The SPX and the Dow have mature TD Sell Setup counts, while the Nasdaq and the RUT have just started theirs. Also, the Nasdaq will record a TD Sell Countdown “13” today, and the RUT can record a “13” next week – all in direct competition to their TD Sell Setups with volatility squeeze pushing higher. 
PROGNOSTICATION: Taking one obstacle at a time. If the “13’s” on the Nasdaq and the RUT matter, they need to start showing signs of deterioration rather quickly through the shorter duration timeframes. Otherwise, the next point of evaluation comes in three weeks when the SPX finishes off a “9” count TD Sell Setup. With the TTM_Squeeze firing to the upside at this late stage of the cycle, there should be no surprise the market is bubbling higher – possibly to a blowoff top.

Flip to neutral if the SPX does not trade above 1897.28 during the month of May and closes below 1836.27 on May 30th, the 8 month MA. Alternatively, flip to neutral if SPX closes below 1782.59 on May 30th (updated May 5th).


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