Gold traded to a record high today at 1202.7 and a record high settlement at 1196.50
Ditto for silver, as we had a high print at 1926.0 and a record high settlement at 1910.
The Stock Indexes posted new 9-month highs, as the general feeling was one of continued short covering after last Thursday night’s panic sell-off.
SPZ was unable to get the 1112.00 print out, posting its high at 1111.75. DJZ also couldn’t quite get the 10500 print out, instead posting a high 6 ticks below it at 10494. SPZ settled at a new 9 month high settlement at 1108.75, 3 handles off the high print. DJZ posted a new 9-month high settlement at 10464, 30 ticks off of the high print.
On an interesting note, I reviewed several articles on the stock market which I thought were interesting. The first was a study which showed that newsletter writers, as a group, were at their highest level of Bullishness since Dec 2007. Definitely should be a reason to pause and wonder if we are looking at history getting ready to repeat itself.
Richard Russel, a well followed analyst, just switched his bias to bearish, and Robert Prechter, another analyst who is widely followed, is now recommending a short position. Both of those articles were published very recently after the Dubai announcement was made.
That’s why I think that today’s move, while impressive, was fueled more by traders puking losing positions which they put on last Thursday, Last Friday and even as late as yesterday.
It didn’t look or feel like a powerful rally. More so, today’s action was a creeper, with small breaks after each new high was made, which made it difficult to participate in the rally. Also, it was suspicious how SPZ could not get a 1112 high print out, and the DJZ couldn’t even muster a 10,500 print. If it were a powerful trend, they would have had no problem getting those new high prints.
The action today looked like it was a be-grudging rally. It seems like there are a lot of pros who don’t buy this rally, and are not jumping on, but instead are looking for tops to sell, in hopes of a correction.
Good Trading
