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Friday, May 10, 2013

Daily update 5/10

The currency moves that started yesterday continued today.  I noticed later that GLD was also affected in a negative manner.  Dennis Gartman said he did not find any news or any particular reason for the sudden move.  SPX was unaffected today as it rallied back what it lost yesterday.  Since the currency moves continued today it adds credence to their moves.  Whether those moves are important to SPX remains to be seen.  I have been bothered a bit ever since gold broke down the way it did.  It seemed to me that something was afoot.  With central banks pumping out liquidity why was gold falling?  The only answer I could come up with was another deflation episode.  With currencies suddenly on the move it adds to the feeling that something is happening here.  Time will tell if it is something that will affect stocks or not. 

Here is the daily SPX chart.

SPX closed just slightly above the upper channel line again.  Volume was very light today.  It remains to be seen if this is going to be significant resistance or not.  It is certainly extended enough for a pullback.  There were over 300 new highs today so no warning sign.  There is not much to do here until we consolidate or get a sign of a pullback.  This is a high risk spot to add new long exposure.


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