Higher Low Coming
There was a lot of volatility today. There was weakness in the morning and then around mid-morning the S&P futures pushed up to the 2014 level. At around 12:30 I got a sell signal on the market and the market has been down since. Yesterday I stated that the S&P futures were 50 points away from the 10-bar moving average on the daily charts. Currently the S&P futures are down 14 and the overall market is only down about 50. I see clearly that the market is going to make a higher low. There are 55 more business days until the end of the year. I see another 1-3 days to work off the overbought condition before trading up higher next week.
Oil is currently trading at the 46.60-46.70 level. I am looking for a pullback in oil in the 44.50-46.50 range. I am looking to buy UWTI, a stock which goes tick for tick with oil, in the 9.50-11.50 range. Once this pullback occurs in oil I am looking for it to push back up above 50.
Gold is trading in a range. Gold got down to 1151 this morning before trading back up to 1163. I am looking for a pullback in gold along with a severely oversold condition. Once gold becomes oversold on a pullback I would be looking to buy gold stocks such as AUY (Yamana Gold), KGC (Kinross Gold), ABX (Barrick Gold), and NEM (Newmont Mining).