gunDriller
26th April 2011, 08:28 AM
the Zero Hedge article got me thinking -
http://www.zerohedge.com/article/dowgold-ratio-signaling-stock-market-crash
"A brief look at the Dow/Gold chart tells us that the ratio is on the eve of forming a Death Cross, a formation which usually signals a sharp and fierce decline. We already witnessed a simular event in the same period last year.
On top of that, different momentum indicators, like the RSI or MACD (see chart), are pointing towards a potential breakdown of the Dow/Gold ratio near term.
A setback of the Dow/Gold ratio can be realised either by a rise of gold, a correction of the Dow Jones index, or a combination of both.
Gold rising further from current levels is possible, but history clearly shows the yellow metal suffers summer doldrums, which in the current stage of the secular bull market usually means sideward price action for the coming months."
a past history of "summer doldrums" is one thing ... the "sell in May & go away thing" - BUT gold & silver have been tracking very precisely with oil the last month.
and oil is going up this summer.
my own feeling - this summer will not be like last summers.
http://www.zerohedge.com/article/dowgold-ratio-signaling-stock-market-crash
"A brief look at the Dow/Gold chart tells us that the ratio is on the eve of forming a Death Cross, a formation which usually signals a sharp and fierce decline. We already witnessed a simular event in the same period last year.
On top of that, different momentum indicators, like the RSI or MACD (see chart), are pointing towards a potential breakdown of the Dow/Gold ratio near term.
A setback of the Dow/Gold ratio can be realised either by a rise of gold, a correction of the Dow Jones index, or a combination of both.
Gold rising further from current levels is possible, but history clearly shows the yellow metal suffers summer doldrums, which in the current stage of the secular bull market usually means sideward price action for the coming months."
a past history of "summer doldrums" is one thing ... the "sell in May & go away thing" - BUT gold & silver have been tracking very precisely with oil the last month.
and oil is going up this summer.
my own feeling - this summer will not be like last summers.