Economy Looks Good Yields on The Rise

Equities have been trading sideways since the October 30th high. The moves down on the S&P, Dow and NAS from the Oct 30th high look very corrective in relation to the impulsive moves up from the Oct 9th lows. The Dow Transportation has retraced out a corrective like structure so far off of its 7131 Nov 4th high and should be turning up soon. Indexes are correcting at expected Fibonacci levels. Utilities is the only index that looks like is heading down structurally so far. The move down from the Oct 30th high is impulsive while the move up overlapping and corrective. However, the overlapping moves up from the Oct 31st 494 low could be a series of 1, 2s which would confirm the move with the major indexes. These recent moves down on all the indexes are very corrective like at expected Fib zones confirming moves to the upside and are proving difficult to count downward. Keep in mind that the Dow is the only index that made a new high today and that the awesome is showing weakness on the daily and weekly chart while the indexes are making new highs. The Dow and the S&P are coming up now against some very heavy Fibonacci convergence with the Dow hitting it between 16825 and 16236 and the S&P between 1779 and 1821. Sentiment is at dangerously complacent levels with the indexes at dangerous levels.

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The Dollar index hit a high at 80.93 on Nov 3rd and has since retraced in what looks like a wave four to the 80.38. The Buck should head up to complete a fifth wave at micro degree. Target is at the 81.19 trend line resistance at the 161.8% of wave one. This current move for the buck is confirmed on all the major counts.

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The US 10 year has been moving very impulsively from the 1.47 zigzag wave four bottom. It appears so far the yield has just finished a wave four at the 2.47% mark at subminuette degree. Minimum targets have been met and the bond should be on its way to complete its fifth wave the 2.71—equality with wave one.

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Both gold and silver are resting on support trend lines with gold hitting it at 1304 and Silver at 21.55. Both the metals have moved up off of their respective trend lines a bit with gold at 1318 and silver at 22.79. The recent price action in the metals has been pretty choppy; however the path of least resistance so far still looks up. Even though there is a count with both metals heading from lower prices, I believe the metals should finish off their zigzags up. The moves down from the Aug 28th highs look extremely corrective with the recent rallies more impulsive like. The metal should move up from here. However, I am aware that if price breaks down through trend line support, which was tested once already, I am ready to turn bearish.

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