The Brains Trust, page-13209

It was good news all round at the close of last week. I think it means that I am another step closer to getting my “last mad move higher” on Wall Street. But looking at Friday’s performance, the good news was that the US banks finally look as though they might join in as well. Interesting that the top performing sector was XLP – Consumer Staples. This is normally a fairly cautious sector but at the moment I will take whatever we can get.

Looking specifically at the S&P, it is currently 2840. We need to keep in mind that there is pretty tough resistance up here. It was around this level the week before last and couldn’t break free but as well, the all time high last January is just above current levels as well. If the S&P can break out, then I think a quick visit to the 3000 area would be within reach.

A lot hanging in the balance this week.

US dollar ran into a bit of selling that took the pressure back off commodities that generally had a very good day. Nice bounce in metals. I mentioned last week that the Commercials net short position in gold was the lowest since January 2016. It fell even further last week. The commercials net short position being this low doesn’t mean that the gold price will turn up immediately, but it is certainly a step in the right direction. This group are the long-term winners. However, the really good news in commodities was that buying in iron ore has managed to keep this market above the lower boundary of the large triangle. (I have mentioned before that I think someone “knew” how important this level was in iron ore and were prepared to taker other action to support the price!) Even coal was better.

So with all this good news, perhaps Australia might finally join in the celebrations and break out of this blessed range it has been stuck in since April. Mentioned on Friday that there was a nice recovery in the LIT ETF – that buying has carried through which should help this sector here as well. But it still bothers me that even today, the three most liked stocks on Hot Copper are still lithium – even after this long and cruel bear market.