Gold and Treasuries Lag in September, Stocks Lead
**This chart analysis is for educational purposes only, and should not
be construed as a recommendation to buy, sell or sell-short said securities**
Stocks took a breather on Thursday with the major index ETFs edging lower. The Russell 2000 ETF (IWM) led the way with a .73% decline. Seven of the nine sectors were down, but the losses were limited. The Technology SPDR (XLK) found some love with a .08% gain and the Consumer Staples SPDR (XLP) edged higher. The Basic Materials SPDR (XLB) led the way lower with a 1% decline. Weakness in coal, copper, gold and steel weighed. The Gold Miners ETF (GDX) and the Silver Miners ETF (SIL) fell over 5% as gold plunged around 3%. Even though I am not surprised to see gold fall, the decline is a bit perplexing because the Dollar also fell the last two weeks. The media blame goes to Syria and the Fed. I am not sure about Syria, but I might buy into the Fed argument because I think the Fed will start tapering in the coming months. Also note that Goldman Sachs put out a note forecasting a move to $1050 in 2014 because of strength in the US economy.
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Key Reports and Events (all times Eastern):
Fri - Sep 13 - 08:30 - Retail Sales
Fri - Sep 13 - 08:30 - Producer Price Index (PPI)
Fri - Sep 13 - 09:55 - Michigan Sentiment
Tue - Sep 17 - 09:00 - FOMC Meeting Begins
Wed - Sep 18 - 14:15 - FOMC Policy Statement
Fri - Sep 06 - 08:30 - Employment Report
Sun - Sep 22 - 10:00 - German Elections
Tue - Oct 15 - 09:00 - Debt Ceiling Deadline
Charts of Interest: Tuesday and Thursday
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is
not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise).
We all need to think for ourselves when it comes to trading our own accounts. First, it is
the only way to really learn. Second, we are the only ones responsible for our decisions.
Think of these charts as food for further analysis. Before making a trade, it is important
to have a plan. Plan the trade and trade the plan. Among other things, this includes setting
a trigger level, a target area and a stop-loss level. It is also important to plan for three
possible price movements: advance, decline or sideways. Have a plan for all three scenarios
BEFORE making the trade. Consider possible holding times. And finally, look at overall market
conditions and sector/industry performance.
