I was going to write about the S&Ps, about the support we’re seeing at 1,250, how it’s going to go higher for a short bit and then trend lower in the channel, etc. but something else has me going “hmm.” Still, here’s the SPY chart just in case –
Ok, so now for the mystery, although it’s really no mystery at all. I’m impressed with gold and it’s relative strength, unlike silver where there is still a broken bubble and a look like prices could still break lower.
Gold should be collapsing, right? Right. And the action in the gold miners has me thinking that gold’s “crawl” along the 50 DMA is about to move south.
I don’t think it’s the drop of death that silver took, but I do think we could see 1,400 in gold pretty quickly. Miner’s health and the US dollar strength might support this argument too. Oh, and QE2 ends in 8 trading days too.
Just something to think about as the week gets kicked off. Something’s got to move with volume, because it sure isn’t the S&Ps right now. By the way….. I do own some GDXJ puts and some SLV puts in here.
Have a good day/week and trade the extremes!