The HUI was down today -3.75 points (-2.05%) with a close at 178.89. On the daily chart, almost unbelievably, the fast stochastic maintains a positive crossover and is still out of oversold territory. The slow stochastic remains flat and in oversold territory. MACD is heading down and deep in negative territory.
GLD was down -$1.19 (-1.02%) with a close at 115.28. On the daily chart, again almost unbelievably (I might need to check my charting software) both the fast and slow stochastics maintained positive crossover but both are in oversold territory. MACD is trending down and deep in negative territory.
SLV was down -$0.42 (-2.77%) with a close at 14.73. Both the fast and slow stochastics are flat and in oversold territory. MACD is down and descending deeper into negative territory.
Today was all about the Bear. In the first 30 minutes of the session the HUI kissed 181.84 good-bye with the high of the day at 181.64. Well I said yesterday, "watch the metals" of course this was in the context of if there was any hope of a rally in the HUI and not in the context of a drubbing. I also mentioned that since yesterday traded in such a tight range that a big move could be expected. We sure did see a big move down with the HUI dropping to a low of 178.01.
One of the main purposes of this blog is to demonstrate that the HUI trades in a very orderly fashion both on a daily chart and on short term charts (30 minutes). Target numbers are published in advance to demonstrate that these numbers play an important role in how the HUI moves. These "target numbers" show up repeatedly on the high, low or close of the bar. The rules of the game are simple if the high, low or close of the daily bar is within 0.50 points of a target number we have a hit. On the short term bars (30 minutes) if the target number shows up within 0.02 points we have a hit. I mentioned yesterday that when markets move these numbers get hit often. Markets will change or continue a trend at these numbers, depending on the internal strength or weakness of the market.
For several weeks, important daily target numbers have been posted, many of which were central to the days trading and subject of this blog. The previously posted daily target numbers have been 195.55, 190.35, 185.03, 181.84. 176.18. Today the high in the HUI at 181.64 is within the 0.50 variance and constitutes a hit of the daily target number of 181.84.
On the short term 30 minute charts we had two hits with a whole host of "horseshoes" (close but outside the 0.02 variance). Monday's blog stated the following: "With the Bears seemingly in charge I will add the following target numbers to the intraday (30 minute charts): 180.61; 179.76; 178.99; 178.4; 177.38 and 175.78." Today the star of the show was the 178.99 level with a hit on the high of the 11:00 bar (actual 179.00). I counted at least three "horseshoes": 10:00 close at 179.05; 10:30 close 179.02; and 1:30 (13:30) low at 179.03. For almost the entire session the HUI traded on or around this level. We also had a direct hit at 178.4 for the low posted on the 3:00 (15:00). Not bad for numbers posted on Monday, and generated back on June 28th.
I have mentioned that the HUI would hit a significant low between June 20th and July 14th before we see a summer rally. I will stand by that although it is hard to see any sign of rally, it is easy to see a significant low. July 14th is next Friday.
On Monday, it is still all about the Bears. The goal is simple enough take out today's low and drive the HUI down to the next daily target numbers of 176.18, 170.62 and 167.86. There are two gaps in the HUI that formed back in December one on 12/28/16 at 177.56 and one on 12/23/16 at 169.44. As to the 30 minute target numbers I will add the following: 174.14; 173.16; 171.42 and 169.71. As long as the HUI continues to hit these Bear target numbers, even in an upswing, the daily trend will remain down. At this point, there is no reason that the Bears should not be able to fill these gaps. For the Bulls, nothing on the daily chart, except those odd stochastics, says buy. On the 30 minute chart if the Bulls take out 179.79 we might get some sort of a rally. The best hope is for a holding action above 176.18 and perhaps a push back to 181.84? The only other hope is for the Bears to take profit but with those gaps in sight it is hard to see. This current move down is getting long in the tooth having begun on June 27th, but that is what you get when the Bear is hungry.
GLD and SLV there is nothing there. If there are buyers, I say you first.
These are just my thoughts and observations not advice etc. Please feel free to share yours below. Upvote and follow if you like.
As for Monday, good luck and happy hunting.