Good Morning!

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This analog chart plots four of the six worst bear markets (ex 1937 & 1929) as well as declines after 1946, 1961 and 1966. 

The S&P 500 tested the 200-day moving average exactly 7.5 months into this decline. That 7.5 months figure was the average/median test of the 200-day moving average in the 6 worst bear markets. 

But the market is showing good enough breadth which argues this run could continue. On the other hand, the yield curve (10-year and 2-year) is inverted. Over the past 70 years, an inversion has preceded 11 of the 10 recessions. Only once did the signal miss. 




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In TheDailyGold Premium...

We bought three stocks at the recent low. Two have rallied quite a bit. In a recent update we explained why one of the two has big potential- even if the Gold price remains around $1800.

In TDG #791 we updated our chart analysis of the majority of our companies. We noted potential downside support levels because the sector is not out of the woods yet.

The next few months are going to be very interesting. If September is the Fed's last hike (which we would not know for +60 days), precious metals could rocket higher (especially if they make lower lows in the interim).

The market does not see the Fed going above the mid 3's and the Fed will be at 3.00% after September. So, in any case, the majority of Fed tightening could be over a month from now. 
 

 

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