Folks,
Market Observations for the Week: The Mercury retrograde cycle ended on 3/21 and the SPY made a trading low Sunday evening. However, our bias is that the rally in the SPX and PM sector is just a 3-wave correction that could hold up into early Wednesday before taking the SPX back to test its low. At this point, we could see the SPX below 6500 again going into Friday. Signs of credit risk, illiquidity, and the obvious geo-political risk are warning signs here for the broad market. The SPX took out the December low and that is bearish, and we are wary of another SPX spike down by Thursday. It is important to keep powder dry until we see a larger VIX spike above 40 – that could coincide with a crude oil spike larger that the market is not comfortable with. The leadership of the SPX has shifted from the XLF(financials) which topped in January to the XLE(energy stocks) which are both late-cycle sectors in a topping bull market – this still makes us cautious on the future longevity of this stock bull market. Silver and gold peaked on the 3/3 Full Moon and were then sold down into Sunday evening – we still hold a core position in the junior miners. The XLE is in a seasonally strong period(Jan-Apr) and is still favored in our work for 2026 – we also like the MOO ETF(agricultural). Our current investment positions were updated on the 3/10 close: 60% cash, 0% SLV, 0% DIA, 10% MOO, 5% GDXJ/SILJ/XLE, 5% 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 3/20 to include: 80% cash, 10% SLV, 0% CDE, 0% Barrick, 0% DIA, 10% XOM/CVX/COP.
TURNING POINT DAY
Our turn window for this week is 3/23-3/24.
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