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May 21, 2009

Miners Shine

This will be a brief write-up, since I'm tapping out a late night (early morning) post and can already hear my pillow whispering to me. Bears received a grand gift today in the form of a late-day swoon, and the weakness occurred on expanding volume.

s&p 500 chart

It would now be nice to see the SPX take out the 875 pivot on a closing basis to set up a run to the 65DMA and perhaps lower. A key takeaway from today's action is that stocks fell despite a sharply lower dollar. Over the last two months, a falling dollar has been a catalyst for the move higher, so the fact that we saw a rally failure against the backdrop of a weakening dollar tells us something has changed.

Precious metals continued their treks higher, though modestly so, but the big story comes from the miners, which popped over 5%.

gold miners chart

Of course, such a run will not occur without the support of precious metals. I am still of the mind that some wild upside action is imminent.

 

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