SP 500 and NDX Futures Daily Charts

There is a divergence between the SP 500 and the tech sector. There is also a strong indication that the US economy is sluggish, not only in terms of GDP, but also in median wage and consumer spending.

RIMM lowered guidance after the bell, and P&G lowered expectations.

I shifted quite a bit of risk off the table this morning, and went into the close with new short positions on US broad equities, to offset some longs and bring my portfolio to a more neutral to bearish stance. I will probably lose the short positions if the techs can rally tomorrow and hold it into the weekend.

Gold Reserves Per Person

Where are Canada, the UK, and Australia?

Chart: The Economist

Gold Daily and Silver Weekly Charts - Blythe On Her Own Out In the Cold, Après Ski

Yesterday was options expiration and the precious metals were clubbed mercilessly and clumsily, with little attempt to hide it.

Today the metals markets rebounded strongly after a somewhat weak start and some late Comex headfakes.

As I had mentioned I had come out of cash and bought the dip in the precious metals sector yesterday, rather heavily, running cash levels to effectively zero. There was even some picking from the fallen stocks among those wild tigers, the silver miners, and in some size at end of day. Their beta is pretty impressive, and nice when it runs your way.

The buys in the stocks that had fallen to long term support were big fat targets. And they bounced with a vicious flourish today, going up even faster than they had fallen, gaining momentum steadily after the FOMC announcement.

I flipped the hedges early, and just let the metals run into the afternoon, trimming back into the close to raise some cash back again for more opportunistic buys. I like to get my money off the table and let the profits run.

So what next? The formation on the gold chart looks good, and the support on the correction helped to draw the cup of the inverse head and shoulders a little more firmly. Yes there will be draw downs and corrections along the way, but gold looks headed for 1590 and probably beyond, but one leg at a time.

Silver is a juggernaut. I had to force myself to buy beta heavily in that rugby scrum of a market yesterday and it paid off extraordinarily well.

If they want to be really Machiavellian they'll hit the metals tonight and tomorrow again, but its getting so old it might not work, and they'll have to retreat to try and defend another level higher.

And thanks Blythe. You're the best, baby.

Zicke zacke zicke zacke hoi hoi hoi