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Dow Theory Update For September 6: Indecisive Day. No Changes In Trends

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

Precious metals modestly up.

Is a secular bull or bear market?

Doug Short has penned on Seeking Alpha a great article concerning secular bull and bear markets. You can find it here

Another great article by Doug Short concerning the current state of overvaluation of the stock market can be read here on Seeking Alpha:

Bottom line: I find Doug Short is one of the best analyists of the secular trend of the market. I'd tentatively say that the secular trend of the market remains bearish. However, please bear in mind that our Dow Theory "flavor" (namely Schannep's/Rhea's) tends to spot cyclical bull market, and does not invest along the secular.


The SPY closed modestly up. The Industrials and Transports closed down.

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

The secondary is bearish, which implies an ongoing secondary reaction against the primary bullish trend, as explained here.

Today's volume was higher than yesterday's. Since stocks closed up (for the SPY and Nasdaq), expanding volume has a bullish connotation, as higher prices were confirmed by volume.

Gold and Silver

SLV, and GLD closed up. For the reasons I explained here, I feel the primary trend remains bearish. Here I analyzed the primary bear market signal given on December 20, 2012. The primary trend was reconfirmed bearish, as explained here. The secondary trend is bullish (secondary reaction against the primary bearish trend), as explained here.

SIL and GDX closed up. SIL and GDX, unlike GLD and SLV, are unambiguously in a primary bull market under the Dow Theory, as explained here and here. The secondary trend is bullish as well.

Later today, I will post a new episode of the saga "Face off: Schannep versus classical Dow Theory", which you can find here.


The Dow Theorist