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Manuel Blay's  Instablog

Manuel Blay
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Investor and Trader As investor I'm deeply influenced by Dow Theory. I focus on the primary trend (1-2 years). My trading is short-term based (avg trade duration 4-5 days).
My blog:
Dow Theory Investment
  • Dow Theory Update For Feb 7: Inconclusive Day With No Change In Trends  0 comments
    Feb 7, 2013 5:07 PM | about stocks: SPY, DIA, IYT, GLD, SLV, GDX, SIL
    Precious metals continue aimless.

    I am finishing a new post for this Dow Theory blog, which will continue the series I started with my post "How often does the Dow Theory outperform buy and hold?" In the next issue, I will focus on the secular 1966-1981 bear market. I will look under the magnifier the way the Dow Theory behaved under such a terrible bear market. The conclusions are truly encouraging and prove that the Dow Theory really provides the investor with an edge.

    Today was an indecisive day. The SPY and Industrials closed down. The Transports closed up. The primary and secondary trend of the market remains bullish.

    Today's volume was lower than yesterday's. Since, albeit mildly, it was a down day, contracting volume has a bullish implication. I'd label the overall pattern of volume as neutral.

    Gold (NYSEARCA:GLD) and silver (NYSEARCA:SLV) closed down. More meandering. The primary trend and secondary trend remain bearish.

    GDX closed up, and SIL closed down. The primary trend and secondary trend remain bearish. I specially dislike that all the price action is occurring below the level that defined the primary bear market signal. The fact that these two ETFs are unable to even rally for some time above prior relevant lows shows that distribution is more likely than accumulation right now. Here you have an updated chart.

     

     

    (click to enlarge)
    SIL and GDX remain bearish. SIL displays greater relative strength (red line SIL/GDX ratio)

    Sincerely,

    The Dow Theorist

    Themes: Dow Theory Stocks: SPY, DIA, IYT, GLD, SLV, GDX, SIL
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