Nov 23, 2008 Weekend Comments

Wednesday last week I became suspicious of the late day attempted rally, but due to other circumstances was not able to change my Timer Trac long soon enough. However, my Timer Trac SPX close model is +19% vs. -19% holding since Oct 20, an impressive gain vs. loss in one month.

Also, as I had been saying buying gold mining shares vs. the stock market was a better choice. At the end of the week my XAU vs. SPX model since Oct 23 was +51.8% vs -12% for the SPX and +51.8% vs. +31% on the XAU hold model.

All models point to a short term bottom Friday and I called it perfectly Friday ahead of time with a call for an up gap followed by a rebottom down 100 points on the Dow then finishing up about 500 points on the day.

Next week looks bullish for both the stock market and gold mining shares with a possible top the day after Thanksgiving on the stock market and Dec 1 for the mining shares. The GDX target is 28/29 and the stock market into the mid 900's to around 950 +/- on the SPX.

We will likely trade out of all longs by those dates and initiate new short positions. The stock market needs to make one more lower bottom into mid/late Dec and the gold shares are iffy after the projected Dec 1 top, even tho' the 8 year cycle projects more strength into about the third week of Dec.