This applies even to the hard assets upon which the Adens usually fall back.
“…Oil declined from its highs, which was the last standout. It’s now vulnerable below $99, and copper is weak below $3.50. Stay out of resource and energy stocks until the dust settles.”
“If gold tests its 65 week moving average near $1525, it would be a 20% decline… We know this decline is unnerving but keep focused on the big picture and hold your open positions. This is still the time to be buying and accumulating during weakness.”
When I last looked at Dow Theory Letters’ Richard Russell and Stealth Stocks Daily’s Dennis Slothower, both of whom heroically write every day after the market close, both were stoically unbudged bears despite what had been a strong week.
As it turned out, stocks were then at about their high for the month. And both editors are now even more bearish. Russell writes:
“I am warning all my subscribers again that we are back in the grip of a vicious and ruthless bear. The bear has been held back for almost two years, due to the so-called quantitative easing of an anxious and ignorant Fed. There’s no bear angrier than a frustrated bear. As a result, I believe we’re going to see a brutal stock market that will shock the Fed and the bulls and the public — and all who insist on remaining in this bear market… Remember, the KEY number for the Dow is 10,000. Below 10,000, the bear really takes over.”
On gold, he writes:
“I think we’ll see selling of gold to cover losses (particularly losses by the short sellers), but ultimately gold will be the last man standing… Gold holding above $1500 is bullish action.”
Slothower is 100% in cash, but in the short run is more cautious. He writes:
“What I see here is a chart pattern that is going nowhere — mostly chop. We are in a downward pattern with this index but there is no ‘persistency’ of the primary trend.
“There is no bull market here and not much of a bear market either.”
However, Slothower says he sees other technical signs of weakness, and adds: “This wedge pattern has to resolve itself soon, as both the bulls and bears can’t both be right for very long.”
On gold, he is even more cautious, writing:
“Gold broke the 200-day Smoothed Moving Average at $1,622, which puts into question a continuing bull market in gold… Gold is now testing a very crucial trend line which must hold or all kinds of stop loss limits will be triggered here. Given what is happening in Europe and in Asia we have no idea the magnitude of the dominoes that could start to fall here, but gold breaking down suggests the market is expecting ‘deflation’
