Thursday, August 23, 2012

23 Aug 2012

Nothing is oversold yet. Significant divergences in all time frames.  A lot of media is saying the stock market went down because the Fed disappointed.  If the stock market went up, the media would have said that it was because of a successful Fed meeting.

Either way, it's sad that an economy (market) depends solely upon how much new money is being created to perform large scale asset purchases.  It's more sad that large scale asset purchases are inflationary, and inflation most heavily affects the most poor. Speaking of, let's look at gold and silver.
 GLD is sitting on top of its long term resistance trendline.  Notice that since it broke my previous more sharp trendline, it has rallied.  However, stochastics, RSI and the upper bollinger band (3std) may show that this is too much too fast.

The same applies to silver.

Considering interest rates aren't as negative as they were and the CPI adjusted monetary base is contracting, I'm tending to believe that these moves will take a breather and consolidate again before breaking above my trendlines.  However, anything is possible.

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