Dow Theory Update For January 7: Stocks Well Bid Today But Fail To Make Higher Highs
Seeking Alpha Analyst Since 2012
Co-Editor of the top-ranked investment Letter thedowtheory.com
Investor and Trader As an investor I'm deeply influenced by Dow Theory, especially by the book "The Dow Theory for the 21st Century". I focus on the primary trend (1-2 years). My trading is short-term based (avg trade duration 4-5 days).
In addition to US stock indexes, I have successfully expanded the application of the Dow Theory to precious metals, their miners, and US interest rates. The Dow Theory is a more accurate timing device that moving averages, breakout systems, etc.
And Trends remain unchanged
If you are interested in reading the 2013 Dow Theory review please go here. You'll see that we tended to be on the right side of the market most of the time.
US stocks
The SPY, Industrials and the Transports closed up. However, the 12/31 closing highs remain unbroken.
The primary trend is bullish, as explained here, and more in-depth here.
The primary trend was reconfirmed as bullish on October 17th and November 13th, for the reasons given here and here.
Gold and Silver
SLV and GLD closed down. For the reasons I explained here, and more recently 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.
As to the gold and silver miners ETFs, SIL closed down, and GDX closed up. The primary trend is bearish, as was profusely explained here and here. Likewise, the secondary trend is bearish.
Sincerely,
The Dow Theorist
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