Top Line: The stock market should have topped back at the SP500 level of 1018 and so far the market has respected that line. The slow turn down has started. This move will be faster later in the move, in September.
The stock market showed some signs of price declines, especially on Friday. There was some bounce back late on Friday but we think that bounce was just a little countertrend correction of the down move. What that means is that a decline, or advance, will not go in a straight line. There will always be Corrections in the move that go against the main trend.
We just thought we would mention how GDX has been trading. Over the past ten days GDX tradeded up to nearly 42 and last week it broke 38.50. Back in mid-July GDX nearly got down to 34 which represented good value and now looks like it may be the low for the move. The stock will most likely suffer some further declines as the stock market drops but we do not think that the 34 low will be taken out. Another way to say that is GDX has probably put in its low for the move and will not go below it in the next month. Another way to look at it is that if it gets down to the 34's or so, BUY IT. We'll keep an eye on it, too.
We have been on vacation and have not been watching the market during the trading day. [We have been at the PGA Championship this week and no cell phones were allowed. Not only that, today Tiger Lost.] We hope to be more on top of it starting Monday. Any thoughts from you?