Not much has changed in the world of inflation predictions.
- The dollar is rangebound.
- The yields have topped out.
- The FED has stagflationary issues to contend with.
- Raw material supplies are low.
- Geopolitics remains an issue.
- Employment costs are rising.
- The government debt remains high.
- The money supply bottomed out in 2023.
- Government spending has not abated.
But:
The consumer is starting to shift with consumer confidence coming in much lower than expected.
This in turn shifts market sentiment to recession and low demand, hence, lower inflation.
But what about silver?
This precious metal has had a big correction off the recent highs, yet now the price is approaching the support levels where it broke out from in late March.
Plus, every time the bears have come out on the metals, or oil, it has been a new buy opportunity.
Is this time different?
On the monthly chart not featured here, silver spent 7 months above the 23-month moving average or in a bullish 2-year business cycle.
On the futures chart of May (spot) featured here, on April 2nd, silver cleared $26.00, a level not cleared since April 2023.
To the argument that silver has topped, looking back at April 2023, we could make the best argument.
Silver cleared $26 but for only 3 weeks. Then it gapped lower in early May 2023 and did not clear that level ($26) again for a year.
Is that make this time bearish?
Maybe more a reason that Silver is taking time to really go parabolic.
If silver futures break under $24 at this point, we would concede our bullish bias longer term.
For now, though, we like it when the weaker bulls shift-it gives us a chance to add to a position with a much better risk.
ETF Summary
- S&P 500 (SPY) Still in a caution phase-500 now support 511 the 50-DMA resistance
- Russell 2000 (IWM) Still in a caution phase-190 support 200-202 resistance
- Dow (DIA) Still in a caution phase 380 support 388 resistance
- Nasdaq (QQQ) Still in a caution phase 430 pivotal
- Regional banks (KRE) 45-50 range
- Semiconductors (SMH) Still in a caution phase 204 Support 220 resistance
- Transportation (IYT) 63 support 67 resistance
- Biotechnology (IBB) 128 resistance 125 support
- Retail (XRT) 71.50 support 75 resistance
- iShares iBoxx Hi Yd Cor Bond ETF (HYG) Under 76.50 caution