Folks,
Market Observations for the Week: The SPX pulled back into the 11/5 Full Moon but only gave us a 3-wave bounce into late Wednesday – this is short-term bearish and allows the SPX correction more room to go down into a test of SPX 6700. The SPX 3-star critical reversal window for 11/3-11/5 and the Full Moon Timing Window 11/4-11/6 argued for big volatility this week and we are getting it. The Supreme Court decision on the Trump emergency tariffs could also bring some volatility to the market later in November. After three days of a trading range above its Bollinger Bands last week, the SPX and NDX are giving us a “reversion to mean” trade down in the first week of November. After just a 3-wave SPX bounce into Wednesday’s Full Moon, we are on the defensive and prefer to hold cash. The Option Premium Ratio closed at 0.73 on Wednesday, a multi-month high, and this is short-term bearish. Gold and silver pulled back into 10/4-10/6 Full Moon Timing Window and also bounced – the GDX is outperforming gold as we got past the Full Moon and that is bullish for the PM sector. We believe that oil stocks (XOM, CVX) should be acquired here on dips for the intermediate term. Our current investment positions were updated Wednesday: 20% cash, 0% QQQ, 20% GDXJ/SILJ/XLE, 15% XOM/CVX/SLB and 20% physical gold/silver/platinum. We have a 25% overall allocation to our short-term trading account which was last updated on Tuesday to include: 25% cash, 25% SLV, 25% GLD, and 25% GDXJ.
TURNING POINT DAY
Our next turn windows are 11/3-11/4 which is a 3-star critical reversal day and the 11/4-11/6 Full Moon Timing Window.
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