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Precious Metals & General Market Review
October 2015 – Issue #340.d
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"Shades of Eleven"
The markets responded quite well by the end of last week as the bulls continued to fight their way
back from the throes of the August shambles.
One of the funds my wife is invested in tells the story quite well.
Obviously the month of October has one more week to go before this monthly chart's candlestick
will resolve, nevertheless the response so far this month is quite bullish.
A tweezer low has been followed by a bullish candlestick. The 5 month exponential moving
average is reversing upward and bailing out from a bearish crossover down thru the 14 month
exponential moving average.
It performed the same magic back during 2011. This chart leaves me with the sense that the
current bull market is not over yet. The recovery in price is inspiring. Relative strength has
remained inside its upper half since 2009. That's very encouraging too.
For a balanced fund such as this to have more than doubled off the 2009 low is quite a story. I
like this fund. May it continue to inspire and move higher.
The S&P 500 Index performed well last week, rising over two percent. It has bested 2040 and is
now entering overhead inventory resistance territory. The volume has been decent on the bounce
the past few weeks, overcoming the down volume.
A trading range has emerged between 1875-2120. The much needed correction rebalanced bullish
sentiment nicely. It was long overdue.
But there is so much work ahead for the bulls. The bears have not given up. Even the owner of a
neighborhood oriental restaurant remains short to the hilt and convinced we're in a new bear
The Thirdeyeopentrades Bull-Bear model remains on Bull. There has NOT been a 10 down thru
12 month exponential moving average bearish crossover. Price has (so far this month) made it
back above those moving averages.
I see a larger rising bear wedge forming (red and lime green) which suggests the bull can run
Relative strength is gaining again above 50.
The stochastic indicator remains above 50.
The current pattern mirrors the action of 1998 and 2011. It's a remarkable reversal off the August
If your money can't make money sitting in a bank account, then where other than the market does
it make sense to keep it?
Folks like a rising market.
It sure looks like the market doesn't want rates to rise. This chart suggests that the bears might be
in some hot water as price closed up thru both 2015 upward sloping resistance lines last week.
That's some good action and we could see an end of year bear squeeze setting up.
That's some amazing work by the bulls. The CPC does have some room to stretch bullishly lower,
but some type of pullback reaction should be anticipated over the next couple weeks, I think.
The 200 day exponential moving average will require a test down near 2030.
This model suggests that the bull market will continue and this year's pattern couldn't resemble
2011's any closer.
Back then, there was a bounce into overhead resistance and then a November sell-off.