Market internals have been powerful today, supporting each break higher and past overnight highs. I will publish an illustration later. This is nearly a textbook day to illustrate how strong internals support breaks to higher levels. The NASDAQ 100 pattern is analogous to the S&P 500, but a bit weaker.
We will see if the afternoon drive (that should start in the next 15 minutes) can support breaks above yesterday’s highs. There is a better chance on the S&P 500 than the NASDAQ 100. If such a break does occur, we may have a pivot that could finish this leg from March 24th with a double top or possibly slight new highs. We nearly tagged the low end of the weekly expected move already, so the downside might be contained for now.
As demonstrated in the chart published in this morning’s writing, price action might carry us into the May 8th topping zone, which I have identified as the “ideal” position for the 18-month cycle peak. “Ideal” is in quotes because it is rare that the markets deliver much that is ideal or to our precise liking. But as with horseshoes and hand grenades, close is good enough.
I am unsure that our gold position would buck a significant stock market downtrend – though I try to keep an open mind. I am trying to decide whether to nail our substantial profits at the close today so stay tuned.
A.F. Thornton