Golden5 at Work: Why I'm bullish on Gold

 Remember our key guiding principle : "The Golden 5"

Golden5: Context:

• DXY looks prone to correct, 
• Correlation to Treasuries seem to break
• GLD looks ready to move up,
• QE3 around the door
• FED Swaplines indirectly through the ECB bail out the european banks without a limit set

 Golden5: Breadth:

• Breadth of the Miners indicated exhaution

Golden5: MOMO/ Golden5: Volume:

• Momo is oversold
• MoneyFlow is oversold and has already flipped
• Daily Exhaution floor must hold and could offer a good springboard

 Golden5: Sentiment:

• Silver/Gold ratios are oversold and held their support levels
• OptionFlows show no conviction to either side meaning the bear has been exhausted and the bull is not yet on board
• The PO OSC (bottom right chart) has reached a level from which we observed bounces in the past
  (PO OSC: Cash Premiums over OFEP, pls see here for explanantion)

GLD

SLV 

Summer ROADMAP for the Institutional Portfolio

The Market shows negative bearings which will result in a bounce that will retest the new market character.

Price MOMO is still pointing down while the MoneyFlow MOMO ticked down again. Our proprietary SPYDER optimized MOMO Indicator (bottom of the chart) looks oversold and hints at a bounce over the next week or so....

The TimingCycles model seems to be insync with the broken HS Pattern. Following this roadmap I expect a short-term bottom/ bounce around the mid of the month leading to a re-test of the Head&Shoulders break down and ultimately at least fullfilling the HS downside target into late July.

This all means a re-test of the March lows. These lows will ultimately decide whether the bull continues (triggered by QE3 ?) or whether we go into real bear territory.

Mr. Market is in a muddled state

Base Case:

The Spyder is exhausted (weekly Exh. Sum. Index) and sports a Divergence in the daily.

The MOMO picture says the same where we have a Div in the MACD (top chart) in a market that lost the big buying in 11-12/2010 (see flow MOMO on the bottom).

BUT some of the key stocks have already deteriorated a good way and are close to OVERSOLD readings. Stocks like AAPL...
...or look at Goldman, where the Chart looks broken and daily exhausted with still more room on the weekly Exh. Summ. Index.
Freeport has already reached a good level on the weekly.
Bottom line:

the Market is at a crossroads where....

...it didn't tumble althought FCX, GS, AAPL etc. took a beating (bullish case)

...the leading stock took the beating first and are about to pull the market into some downdraft (bearish case)

What is the Spyder up to?

The timing model is beautifully aligned and hinting at a TOP!

MOMO and Flows sport neg. Divs in the face of a breakout which could mean we see some 'ending action'.
The Options saw another shortsqueeze which catapulted the market up another time. The extend of the previous failed short smacks of ending action too...
Medium term we face an exhausted SPYDER that needs a break.
All in all we seem to stretch the rubberband further and further until this game comes to an abrupt end...

Equities will follow OIL down.....

Unless we get a quick QE3 announcement, the SPYDER and the Q's are in position to correct. The Correction could be of cyclical nature (but does not have to be):

MOMO and Flows are negative, plain and simple.
...but whether the correction starts now or whether we will see another re-test of the high (see cycles chart in top right) is unclear.
Option pictures are muddy right after the OPEX, given the amount of active market making we have experinced in the last week.

FLOW and MONO unpdate

The medium is at risk and so is the short term. Look at the bearish Money Flows of the Institutional Portfolio (!!).

DOLLAR or SILVER are differnt coin of the same story. Silver could falter in the not too far out future.

And don't forget OIL which is also linked to the Dollar story.

MOMO and FLOWS paint a blurred picture for the SPYDER

More upside seems plausible, but a tumble from here as well...

MOMO and Flow update

Gold looks neutral!

Tech and SPYDER seem work work on the bearish side scheduled

MOMO update

The MOMO story seems consistent where we could see more s/t bouncing in an unfinished bear and the opposite on the GOLD side ....

Can Gold develop a neg Div !! <=> one final spike up......

MOMO and FLOW update: ....follow through bext week ?

Inst. Porfolio could bounce early next week into the 1st of March but still has some work on the downside to be done.

Can the PrecMetal develop divergences ?
Banks are extended.
Oil could be exhausted here ...OR...develop divergences while shooting higher.

MOMO and Flow update

MOMO and Flow update

The Market looks very extended and tired.

The same on the Tech side.
Gold on the other side could see some good medium term upside action.

MOMO and FLOW update