My general outlook on the situation at hand over equities can be boiled down to an expression I’m sure you’ve heard before: I learned long ago never to wrestle with a pig. You get dirty and besides – the pig likes it.
Here’s a screengrab of the current Zero indicator in action. Actually – if you step back and squint you can see a bunch of pigs knee deep in the trough and loving it. As you can see, courtesy of the Zero Lite participation signal, sentiment quickly turned from ‘woohoo free money for everyone’ to ‘oh crap – better get out while the butcher is in the shop sharpening the knife’.
Apart from the equities sideshow however the real action is happening over on the currency side. I have a whole collection of juicy setups waiting below but let’s first look at the Dollar which has once again been stomped lower. The weekly has us a few ticks above the 25-week SMA but it’s the monthly you should be watching carefully. That diagonal support line is very well developed at this point and current support not only lines up well with the 100-week SMA but also the 25-month SMA. Let’s just cut through the nonsense and mark 81 as our new do-or-die level.
Gold may have some of you guys confused but it’s now painting an RTV-L on the daily chart. Nice context given that weekly NLSL which thus far has been holding up. Given what transpired this weekend that’s rather positive for the goldbugs, but let’s see if this setup materializes. Had you been a subscriber this morning you’d been long since the lows – better luck next time.
UPDATE – as we’re dropping it’s possible that we breach the Friday lows and the long setup goes bust today. Just a reminder that a close below the Friday low (and the weekly NLSL) is a short signal. I covered that in this morning’s update but wanted to make sure everyone is on point.
More on precious metals plus some kick-butt Forex setups waiting below – please step into my lair:
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Now – did I promise too much? 😉