Equities, Dollar, Oil And Gold Under pressure
Markets are under pressure -- theequities, dollar, oil and gold are all struggling at these lofty levels.Equities are as overbought as they have been in history, based on the RSI. On aweekly and monthly basis, the RSI has never been higher. This is the firstmarket I can remember which only goes up and hasn't had two-way trade. Even thefamous bubbles of the 1990s and 2008 went up and down.
Gold and other commodities havenot benefited from the weakest dollar in years, leading us to the conclusionthat the dollar is near a bottom and gold and oil near tops. That's not to saygold and oil can't rally a bit in the next day or two; however, we are on thesell side of both and look at the risk-reward model, which indicates more moneycan be made to the short side.
Until further notice, rallies in equities,gold and oil should be sold. Gold is not a buy until it can breakout over $1,365and hold. The big rally that started on Dec. 12 has run its course. Commercialsare carrying record short positions, which indicates pressure will remain onthe metals. Don't look now but all signs point to a reversal across the board
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