July 1, 2009

For 30 to 90 days horizons: Short SPX on 5/13/09 at 883.92.
Monitoring purposes GOLD: Gold ETF= long GLD at 89 on 4/24/09
Long Term Trend monitor purposes: Flat
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Above is the daily SPX chart. The graph behind the SPX chart is the Bullish Percent Index. We have identified with blue arrows when the bullish Percent index had bearish crossover with it’s 10 day moving average which are sell signals. This indicators gave recent sell signals in mid May and another in mid June and remains on a sell signal today. The topping process that has been going on since early May appears to be forming a Head and Shoulders top. This small H&D (labeled in Red) has a downside target near 82 and a 50% retracement of the rally from the March low would give a target to the 81 level. There is also a possible Head and Shoulder bottom forming (labeled in Blue) where the Left Shoulder came in at the November 2008 low the Head at the March 09 low and if the market does pull back here like we expect, may form the Right Shoulder. The bottom of the Right should could fall as low as 740 range but does not have to. We will see how the pull back unfolds in the weeks to come. We are short the SPX at 883.92.

Above chart courtesy of www.ETFinvestmentoutlook.com. We are very bullish on the gold stocks for longer term and are expecting all gold stock sectors (GDX, XAU, HUI, XGD.TO) to hit new highs later this year or early next year. Above is GDX with its McClellan Oscillator and Summation index. A couple of weeks ago the McClellan Summation index gave a sell signal by crossing the 20 EMA and remains on a sell signal to date. In general we expect the GDX to move lower. A possible area where support and a bottom may form is near the 30 range on GDX. We will see what happens if and when GDX gets there. We are expecting GDX to follow the SPX to the downside and both indexes to bottom together. A possible low may form in GDX around August. Physical Gold may hold up well and we will hold our position in GLD. Long GLD at 89 on 4/24/09. Long KRY at 1.82 on 2/5/08. We are long PLM at 2.77 on 1/22/08. Holding CDE (average long at 2.77 (doubled our position on 9/12/08 at 1.46, Sold 5/13/09 at 1.55=6% gain). Bought NXG at 3.26 on 6/4/07. We doubled our positions in KGC on (7/30/04) at 5.26 and we now have average price at 6.07. Long NXG average of 2.26. For examples in how "Ord-Volume" works, visit www.ord-oracle.com.