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Dow Theory Update For June 19th: Gold Breaks Up Above Primary Bull Market Highs Unconfirmed By Silver

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

Same with GDX unconfirmed by SIL.

I am stranded in an airport due to very bad weather conditions in USA. Lighting, floods, flights cancelled, etc. Let’s try to get done a quick post.

US STOCKS

The primary trend as per Schannep’s Dow Theory is bullish since March 1st, 2019 when both the Industrials and the S&P 500 closed at +19% from the 12/24/2018 bear market closing lows.

However, “capitulation” suggested the opening of a partial commitment to stocks on the very day of the market bottom (12/24/2018). More about that partial commitment here.

And more about “capitulation” in general in the following links:

Dow Theory Special Issue: Capitulation. The ultimate bottom indicator (NYSE:I)

Dow Theory Special Issue: Capitulation. The ultimate bottom indicator (II)

Dow Theory Special Issue: Capitulation. The ultimate bottom indicator (NASDAQ:III)

The secondary trend turned bearish on May 9, 2019 as explained here. and here

On June 5th, 2019 a setup for a primary bear market for US stocks was completed as was explained here.

Since June 5th, the technical situation has not changed as per the Dow Theory. The primary trend remains bullish, the cyclical trend which is longer term than the primary trend is bullish too (as explained here, and more in general here), the secondary trend is bearish (secondary reaction) and the setup for a primary bear market signal remains in place. Stocks continue edging higher even though no index has managed to break up the last primary bull market highs prior to the onset of the current secondary reaction, and thus we cannot declare the end of the ongoing secondary reaction.

GOLD AND SILVER

The primary trend is bullish since 12/24/2018 as explained here. No changes. We finally got a secondary reaction on 4/16/2019 when GLD violated its 03/07/2019 closing lows (and confirmed SLV which had done so some days ago). More about the entrails of such a secondary reaction here and here.

Furthermore, currently SLV and GLD setup for a primary bear market signal as was explained here.

On June 18th, 2019 GLD managed to break up above the closing highs of the primary bull market unconfirmed by SLV. Hence, we cannot declare the end of the secondary reaction. However, since the primary trend has been bullish (we only have a secondary reaction), the primary trend remains bullish. However, the longer it takes for SLV to confirm the more suspect the higher highs made by GLD will look.

Here you have a chart (lower quality as usual) as I don’t have my normal desktop at my disposal. The blue horizontal lines display the last primary bull market highs. As you can see, SLV is seriously lagging behind gold.

GLD is strong. However, SLV is far from confirming

GOLD AND SILVER MINERS ETFs

The primary trend is bullish since 12/18/2018 as explained here. No changes.

The secondary trend is bearish (secondary reaction) since 4/18/2019 when GDX violated its previous 03/06/2019 closing lows (and confirmed SLV which had done so several days before), as was explained here. and here

Furthermore, currently SIL and GDX setup for a primary bear market signal as was explained here.

On June 17th, 2019 GDX managed to break up above the closing highs of the primary bull market unconfirmed by SIL. Hence, we cannot declare the end of the secondary reaction. However, since the primary trend has been bullish (we only have a secondary reaction), the primary trend remains bullish. However, the longer it takes for SIL to confirm the more suspect the higher highs made by GDX will look.

Here you have a chart (lower quality as usual) as I don’t have my normal desktop at my disposal. The blue horizontal lines display the last primary bull market highs. As you can see, SIL is seriously lagging behind GDX.

GDX acting strong whereas SIL is lagging behind. Higher highs not confirmed

Sincerely,

The Dow Theorist