Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Dow Theory Update For August 8: Precious Metals Gap Up. Stocks Close Up

|Includes: DIA, GDX, GLD, IYT, SIL, SLV, SPDR S&P 500 Trust ETF (SPY)

Primary and secondary trends unchanged

Next weekend, I will post the next issue in the saga "Face off: Schannep versus "classical" Dow Theory", whose first part can be found here.

Let's examine the markets under the prism of the Dow Theory

Stocks

The SPY, Industrials and Transports closed down.

The primary and secondary trend is bullish, as explained here, and more in-depth here.

Today's volume was higher than yesterday's. Since stocks closed up, expanding volume has a bullish connotation. While volume readings are always more subjective than price readings (especially when price readings are anchored in the Dow Theory), and after weighting yesterday's and today's action, I'd say that volume is turning bullish. We have had two consecutive bullish volume days, and the last breakup of 08/01 was a bullish pivot, as was explained here.

Furthermore, albeit with not the text-book clearness I'd like to see, volume seems to expand on rallies and contract on pullbacks, which tends to be bullish.

Here you have an updated chart:

 

 

Volume seems to be turning modestly bullish

Gold and Silver

SLV and GLD gapped and closed up. The primary trend is bearish, as explained here and reconfirmed bearish here. The secondary trend is bullish (secondary reaction against the primary bearish trend), as explained here.

SIL closed up, and GDX closed down.

The primary trend is bearish, as explained here and reconfirmed bearish here.

The secondary trend for GDX and SIL is bullish, as explained here.

Sincerely,

The Dow Theorist