SPX Monitoring Purposes: Neutral.
Monitoring Purposes GOLD: Long GDX on 10/9/20 at 40.78.
Long Term SPX Monitor Purposes: Sold long SPX on 1/15/21 at 3768.25= gain 10.80%; Long SPX on 10/26/20 at 3400.97.
For very short term, the SPY may be nearer to a low than a high. The middle window in the chart above is the “two-day TRIN” indicator. When the two-day TRIN indicator adds up to 1.50 or higher, the market was near a low. Today, this indicator closed at 1.47. TRIN closed at 1.79; a closing reading above 1.21 will trigger a bullish development. If a bullish signal is triggered, a bounce is likely and could carry the SPX to the 4000 level, which we have mentioned in the past for a possible target high. The “Three Drives to Top” may still be in the cards, but may see 4000 first before seeing 3700 (the target for the Three Drives to Top bottom).
The second window up from the bottom is the SPX/VIX ratio. It’s common for the SPX/VIX ratio to lead SPX. Over the last week, the SPX/VIX ratio touched a new short-term high, suggesting SPX may do likewise. Previously, we thought there could be a test of the SPX 4000 level as round number are like magnets, and that may still be the case this time around. The evidence still suggests that a Three Drives to Top may be forming and the SPX may test the 4000 level first to complete the “Third top” of the pattern.
The middle window is the weekly GDX/QQQ ratio. Intermediate-term lows have formed in GDX when this weekly ratio closed below .11. This ratio reached bullish levels at major support line that dates back to 2014. Sample size is small, but the last three were spot on. Could still be a gyration in the market to gets things going, but gyration or not, it appears an important low is forming. Long GDX (10/9/20 at 40.78).