Today the US Dollar Index remained weak as stocks sold off and crude oil tumbled, but here is the key to tomorrow’s trading.
The Final Exhaustion?
By Bill Fleckenstein President Of Fleckenstein Capital
January 30 (King World News) – Overnight, the SPOOs swooned, for no apparent reason, although the mainstream media will cast about and find one to attach to the decline. Within an hour of opening, the indices were all about 1% lower. I don’t really think there was a proximate cause. More likely it was just a form of exhaustion…
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Reality Check
Whether it was the final exhaustion we can’t know just yet, but perhaps the reaction to earnings in the next few days will tell us something. By all rights, Apple and its suppliers should get drilled as they report results, so whether they do or don’t, and by how much, will tell us a lot.
After the initial decline, the market tried to bounce but did not get very far before the rally fizzled. On the other hand, no new downside progress was made either as the indices closed with the 1%-plus-or-minus losses you see in the box scores.
Selling the Non-News
Away from stocks, green paper was slightly weaker, oil lost 2%, fixed income was heavy at the long end, with the short end not doing too much, and the metals were initially higher before they gave up their gains and closed with small losses. My guess is we are not going to know what gold wants to do until we get through the perfunctory kneejerk selling that always seems to happen after the FOMC statement is released early tomorrow afternoon.
Included below are two questions and answers from the Q&A’s with Bill Fleckenstein.
Miners Building A Solid Base
Question: Hi Bill, someone told me a long time ago that bull markets have fairly sharp pullbacks, such that it makes you think the trend is done. I think I’m seeing that now with the gold miners. I’m I on to something or are the miners still trying to base out? Thanks Bill, Take Care
Answer from Fleck: “They have been building a base for a long time now.”
Fleckenstein Buys More PVG On Selloff
Question: What is your plan with PVG? Will or have you sold any or all at a certain price?
Answer from Fleck: “I didn’t sell any, nor do I intend to. I actually bought more.“
***To subscribe to Bill Fleckenstein’s fascinating Daily Thoughts CLICK HERE.
***ALSO JUST RELEASED: A Massive Secular Bull Market Just Got Started That Is Going To Send Gold & Silver Skyrocketing CLICK HERE TO READ.
***KWN has just released the powerful audio interview with Gerald Celente discussing why the world is heading into a major crisis in 2018 and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.
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