6:16 am PST. /DX bouncing off a pivot support.

5:37 am PST. Nice. Gold is up $17.10 this morning. I think we will surpass $1243.20 soon, which was my level of confirmation for a new bull market wave 3 higher. $1243.20 was the bottom of wave 1 down of the correction. In Elliot wave speak, wave 4 cannot overlap wave 1 if the market intends to do another impulsive wave further down – in this case to below $1000. If we overlap $1243.20, that means no more impulsive wave down and gold is in a new major wave 3 higher. Typically what happens is that prices will overlap the wave 1 bottom, retrace a little, then continue the march higher. We have not yet overlapped $1243.20, so another wave down to below $1000 is still possible, but looking at the mining stocks gives us a lot of clues. I think the mining stocks say gold is in a new wave 3 up.

The dollar could waterfall from here.

My horizontal line shows the overlap confirmation point.

1:25 pm PST. This is also the second day SLV has closed above the 161 EMA. Yesterday it gapped up over, today it went down and tested it exactly, as well as the 4EMA and bounced, albeit on lower volume. Interesting.

1:21 pm PST. The dollar closed still bearish. It backtested the 4 ema and sold off on higher volume. It is still below so technically still bearish. HYG made a marginal new high on even greater negative divergence.

Facebook, on the other hand, had a major pop higher after the earnings announcement today.

Gold looks like it ought to retrace further, but I keep saying that and it keeps climbing. There is always the risk that it could retrace further, but GDX closed above the 4/8 today, albeit on lower volume, so technically the trend is still up.

11:33 am PST. The fact that SSRI held the backtest after the Fed announcement is very good. Also that AUY is moving up when it could have done the wave c, is very bullish.

8:13 am PST. Possible wave count for AUY. I am totally flat.

8:04 am PST. The EUO popped up out of what looks like a bull flag, then went back down and tested the middle trendline of the flag. It is now back in the channel. It could still make a new high. It is a coin toss from now until the Fed.

7:46 am PST. I am watching HYG, the high-yield-corporate bond etf for clues as to what this market is going to do. Personally, I think HYG is topping, because it is negatively diverging, but markets can always still continue to go up. Just watching it. We did close yesterday above the prints, which was a bullish sign for this morning. But with all the bond prints yesterday, I somewhat negated the importance of these prints in my mind.

Now, we are below the prints from yesterday. It could be an important clue.

Musings on the dollar – I think a weaker dollar would be good for the U.S. economy and for products made here. That is what Trump wants: American made, American bought. How is he going to accomplish that when the dollar is so expensive? Companies are going to repatriate all their money back to the U.S., build factories here, but then cannot sell anything to the rest of the world. I think a really strong Euro would actually cause the demise of Europe, in addition to corrupt politics. Europe would not be able to sell any of their products with a really expensive Euro.

Seat belts.

GDX might still test the 50 sma day.

6:58 am PST. Apple moving up really well this morning after their earnings call yesterday afternoon and helping the Nasdaq move higher. SSRI double backtesting the trendline.

Yesterday, although we closed above the AGG print, AGG has gapped down this morning, while the dollar is up.

1:07 pm PST. Great trading in the precious metals today. SSRI broke above the upper trendline, backtested it and held it as support, then rallied up off the trendline into the close. GDX also had more prints in the afternoon about another 550,000 shares from 23.81-.83 and we closed above. I am super bullish on the mining stocks.

There was also some big buying of the Core Aggregate Bond etf, AGG, at 108.25-.27 and we closed above. I think the market is pricing no rate hike for tomorrow’s FOMC announcement. It looks to me as though the Dow needs to take a breather. The market makers are piling into the bond etfs. We closed above the 7 million prints on GOVT, and now we saw buying today in AGG and we closed above these dark pool buy prints. I remain shy of the Dow, SPY, and QQQ.