In this week’s column by Mike Burk, he mentions that the trend in new 52-week highs is not confirming the new highs in the major stock market indexes.

Reading between the lines, I think he is suggesting that there is a limit to how high the stock market can go without new 52-week highs for individual stocks. But I don’t think he is suggesting a significant decline in the market.

The Longer-Term Outlook

The ECRI index finally ticked higher, and M2 growth has bounced. These are good signs, but they still have some work to do before I can say that this chart favors higher stock prices.

The Dow Theory indicators are mixed. The Industrials look good, but the Transports broke out and then down again. People will be watching to make sure the Transports hold above the May lows.

For Precious Metals investors, I think this is an interesting article fromĀ Florian Grummes. He reminds readers that July is often the worst month for gold and that the recent lows might be a spring board to a new uptrend.

With the US Dollar so low, it makes sense for Precious Metals to rally. But what is confusing is that a couple weeks it looked like a significant break down was about to occur. Then again, there was a similar breakdown at the end of 2015 just before gold ripped higher.

Below is a chart of the Gold Miners. I will be watching.

Bottom Line: The longer-term outlook for the general market is positive, but I do worry that we might have a stock market correction.

Outlook

The long-term outlook is positive.
The medium-term trend is up.
The short-term trend isĀ up as of July-12. Watching for signs of a short-term peak.

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