Thursday Market Commentary - December 01, 2016

Stocks Sell - The current bearish forecast for the major market indexes still stands. The Dow hit new highs yesterday then reversed and closed up only two points. The NYSE Composite Index, Dow Transports and Utilities, along with the Value Line Index unconfirmed the intraday high move in the Dow. Only a few of the large cap stocks were attracting accumulation positions yesterday. The Nasdaq Composite Index hit new highs on November 29, which was also unconfirmed by the Nasdaq 100 Index. Internal indicators are very weak currently. The forecast is for strong sell-off that could happen anytime now this week or next. The 9% spike higher yesterday in crude oil was a short covering event after OPEC said they have agreed to a production cut. Longer term the forecast for crude oil is down, and this recent bounce is an excellent price point to start adding new short positions on crude oil again.  

Bonds Buy Short-Term Sell Long-Term - The current forecast for the 30 year T-Bond is to rally to the upside after its recent severe sell-off after the election. Conversely bond yields are setup to decline at the same time after their very quick and large rise. The 30-year T-Bond rally bounce should see 155 to 158 area which would be another low-risk-high-reward price area to sell short again at for the longer term.

US Dollar Index Hold Short-Term Possible Buy Long-Term - Longer term now the US Dollar is looking like it's got the potential to head much higher. Short-term consolidation to a slight correction pullback would be good healthy price action for the USD index to head higher again. Conversely longer term, the potential forecast for the EURUSD is for the price to go to parity and possibly to 0.8000. More price action is needed to issue this type of forecast. Stay tuned. If the USD index does move higher, upside resistance is 101.797 to 102.150. Major USD index support is now 100.39 to 100.51.

Gold Silver Buy - Gold hit an intraday low of 1,170.95 yesterday. The GLD Gold ETF had the most redemption's of over $2B in November compared to any other asset class and was the largest outflow in Gold since 2013. This price action suggests the gold market may be setting up to head higher longer term with sentiment and psychological indicators on gold extremely negative currently. The potential exists for lower prices short-term, but the forecast is for a possible reversal and higher prices. With a lot of the speculative long positions selling out of the gold market now during this recent severe sell-off, gold and silver have the very strong potential of a reversal and to head higher for an extended period of time. Major resistance is now 1,337.81. The forecast is for prices to head higher again above 1,337,81 very possibly heading to 1,434 to 1,500 and possibly higher longer term. Buying gold and or silver now is a very low-risk-high-reward potential trade as long as you use a stop-loss of some amount if the price continues to decline more.