Weekly Report

For the record, a double top would be confirmed by a move below 735, and that would suggest consolidation unless 722 breaks as well. As long as GLD can hold 370, the chances of a test of 350 have gone down. A move above 390 would set up a test of 400 to 412, where traders should sell if it can get there.

If money comes out of these leadership names it will likely move more into some of the Value and Dividend names. What these are saying is that the curve may steepen, which would be good for the economy.

SPX (S&P 500 Index) did close down for the month of June, but not enough to generate the big oversold readings we had hoped for. Oil prices could rally here, which might mean some issues with stocks – we need to watch for this. You can start to buy GLD now – ideally between here and 350. This market may not make new highs, but it could test the 410 to 412 area.

Stocks are still trading a bit stronger than we hoped for coming into the end of June, but at least (so far!) we are down for the month on the S&P 500 and the NASDAQ 100. As long as TLT can stay above 85 interest rates have probably peaked for the year. There is some short-term resistance in the 102-area on the Dollar, but this should break and send the Dollar to 110, our next intermediate-term target, by the end of 2026.

We have had some sporadic sharp drops, the market has been stronger than anticipated. From a fundamental perspective this must mean the economy is stronger than most pundits believe. We would avoid the long side of GLD and SLV until we actually get a buy signal.

The second half of 2026 should be up, but we believe there should be rotation, and broadening out of the market. If we don’t see this, there could be problems.

We again suggest a larger commitment to Small Cap. Metals could be vulnerable, so watch this carefully over the next few days.

We still see the chance for more correction into the end of June, which would get the daily stochastics down for full recycles. Currently, daily stochastics are turning up in advance of a recycle, a high-risk buy pattern. Recall that our Accumulation Models have been suggesting a major advance in small cap is likely and it looks as if this is starting.

Daily stochastics are down but not yet oversold for SPYand QQQ, and it is likely that these have stochastic buy recycles before this pullback is over. We note that IJR and other small cap indexes continue to trade better than the popular averages, again suggesting this area could be leadership in the second half. This area is a place to add a position in GDX.

Market Vane Bulls is the second highest reading we have had since 1993. This supports our view that the recent action in semiconductor stocks, while speculative and unhealthy, is not a sign of an imminent market peak, and therefore a stronger than average second half of the year is likely. GLD could build a quick base here, with a slight decline in SLV, before the next advance above 400.