The ES took out its MTPredictor daily wave 4 support last week. This typically means more downside ahead however, last weeks low was the end of a 5 wave pattern down. The tendency here is that the ES will correct back up to the wave 4 Decision Point support. Bottom line, with the end of the year just ahead along with a fiscal cliff, it’s become a toss up. Expect positive and negative developments along the way that will increase volatility and the possibility for big pops and drops.
We did have a confirmed Hindenburg Omen last week. This is a sign of an unhealthy market. All market crashes over the last 35 years have been preceded by the Omen. The window for this is until March 2013.
Gold and silver are still long with stops to break even on any swing trades now.
Check out the rest of the analysis including some of the intra-day action from Friday.