The Fred Report - Mid Week Update December 19, 2012We have been, and remain, somewhat defensive in trading positions. Right now trend following systems suggest the trend is up and has not yet peaked. As long as IYT remains above 93 it suggests continued rally. We would add a bit to GLD on a down open, followed by a move above 162.55 for those who sold at 166.The Fred Report - Weekly December 17, 2012
We continue to see more short-term topping signs than not and a break below 139 would tend to imply a test of the recent lows. For now, traders should likely be on the sidelines with bonds, while investors can still look at LQD and PGX as ways to increase income for clients. Starting to nibble at DBA in advance of next year (slowly, not full positions) looks advisable. Japan is starting to come out of a base.
The Fred Report - Mid Week Update December 12, 2012
The quality of the rally was not as strong as it could have been, and while the 144 area on SPY was tested, it looks to have held the market in check so far. The signals suggest stocks should be strong into the end of the week, where we would write calls and take some more defensive action.
Caution is indicated on AAPL and SPY. GLD is seeing the drop we forecast in the weekly letter, and the daily stochastic is not in the buy zone, while the weekly still has some more to go on the downside – in other words we may see some consolidation here over the next week or so. We would look to add to PSAI over the next week or so at 36 or slightly below. GDXJ has support at 20 to 20.50 and we would try to add to this at 20.10 or so.
We do not have good trading buy signals in here. Our concern is a failing rally on the weekly charts that could lead to further decline overall. We maintain upside targets in GLD, but would eliminate over weights in the metals at this time, looking to buy back later either here or lower.
Investors should remain with current positions but realize that the SPY 142 – 144 area is resistance and consolidation is likely in this area. The accumulation models on GLD and SLV continue to look better than the other markets we follow, and should GLD penetrate 171, then 175 it should challenge the 184 – 185 targets we have for this market. We would start to segue into FXI slowly over the next few months.
The Fred Report - Mid Week Update November 23, 2012
Next week may be set to resume trends after the election, and see TLT rally and SPY test down towards the 136 area again. GLD looks attractive, and USO’s weekly indicators have not yet turned up, but UHN and UNG have got favorable patterns suggesting more advancement to them, and a strong day in USO would tend to confirm further advance.
The Fred Report - Weekly November 19, 2012
Stocks are giving some buying indications and we should have a pre holiday rally, but we do not think this corrective behavior is over. Still, a test of the 140 – 142 area is possible. One of our concerns about 2013 is that good, stable income opportunities are going to be less easy to find, and these look like they could help advisors plan portfolios.
The Fred Report - Mid Week Update November 14, 2012
We continue to see a test of 133 – 130 by March 2013, but this area could be tested earlier than expected. We remain with our objective of 185 in 5 months on GLD.
The Fred Report - Weekly November 12, 2012
Stocks have broken support but we expect a “bobbing cork” kind of correction, so a rally here would not be a surprise. Our concern remains that the treasury market has had so many fits and starts that the long term trend may be switching from up to down – and a sharp drop could occur at any time. Gold and the commodities continue to look strong into the end of November and possibly beyond.
The Fred Report - Mid Week Update November 7, 2012
Key numbers on SPY are 142.80, then 145 and failure to close above these this week would be a concern, although unless SPY moves below 141 closing basis the market should muddle through. A close above 167 on GLD would suggest a test of 170 or so, and a close above 175 targets 185.
Equity markets are oversold, and technical indicators are about the same as last week – another rally attempt is at least possible. A successful test of 139 would give us chances for a rally. We remain cautiously positioned. The Yen has started to fall, suggesting Japan could do well in 2013.
Stocks should attempt a rally, but the set-up is such that a further decline could result after a short-term relief rally occurs. Gold has corrected into the forecast support area and is beginning to give some buying indications.
The Fred Report - Mid Week Update October 24, 2012
Our portfolio stance is defensive and we see no reason to change this. SPY has filled the gap from September 5 – 6, so if the current support zone is the low it should rally immediately, from here, on very strong breadth. Below the support zone of 141-139 suggests a test of the 133 -131 area is possible. The accumulation models on GLD remain the most attractive of the markets we follow.
The Fred Report - Weekly October 22, 2012
Until SPY penetrates 141, a test of 148-150 is not off the table and the fact that our minimum objective of 146, where we advocated writing calls, has put a lid on the second part of this rally, is a concern. One of the reasons we think a correction in stocks could occur, is that we have some strong buying indications on TLT. Models continue to suggest that gold should outperform stocks into yearend, and a close above 175 suggests our four-month objective of 184 should be met.
The Fred Report - Mid Week Update October 17, 2012
We think SPY can rally close to, but not much through 150, so we suggest writing calls on a move to 146. A down week in bonds could set the stage for a bond rally, and pullback in stocks. Gold has tried to correct as well, and we hope to see more weakness, but as mentioned our accumulation models on GLD remain quite strong so this may be it.
The Fred Report - Weekly October 15, 2012
The SPY has declined unexpectedly into support, and is oversold enough to support a short-term rally, which we believe is still likely as long as SPY has not traded below 141. Bonds have also slowed up, although if this is a down week we could see some fireworks to the upside.
