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Bonds And Stocks Weak

4/30/2015 6:17:58 AM

Good morning Traders,

With the market pulling back, right on cue, do we want to get more bearish? Let's take a look at the charts and decide:

AAII % Neutral

The AAII Survey data shows a strong level of uncertainty towards future price action. This sometimes can mean a top. However:

AAII % Bulls

The lack of bulls is very bullish. With this data series, since there?s three elements (bulls, bears, neutral), I think we need to look at two new groups of data - i.e. those not bearish, which instead of just bulls - bears, it would be bulls minus bears minus neutral... I'll see what that looks like.

Moving towards a price action indicator:

Weekly Buy - Sell Signals

As we've started monitoring jobs data, and lots of it, we'll be looking for these repeats in patterns. I've noted that there is a seasonal component, but I believe it amplifies the potential of a turn in the economy. Think of it this way, if you push someone that's coming towards you, it's harder than if you push someone moving away from you. This underlying momentum in jobs is important to watch because that's when the market is most vulnerable, to being pushed...

Continued Jobless Claims

Moving on to gold - I'm still bearish:

GLD Volatility

At some point, gold will depart from this forgiving downward channel. But the dollar is key:

Gold versus Dollar Relative Strength

My target for gold is the 2009 lows. The key is when we get there. If we get a melt up in stocks, then we'll get a melt down in gold - whose rally started back in 2000, before the GLD. We may need to reset those bearish gold options. Our oil options are looking good with oil breaking out.

Regards,

 

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