In this update I analyze the developing trends in silver, the broad stock market, the US Dollar Index and 30-year U.S. Treasury bonds. Take a look. Words: 710

So says Dr. Nu Yu (http://fx5186.wordpress.com) in edited excerpts from his original article* (which Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), has further edited below for length and clarity – see Editor’s Note at the bottom of the page. This paragraph must be included in any article re-posting to avoid copyright infringement.)

Yu goes on to say, in part:

The Broad Stock Market (Wilshire 5000 Index)

The Dow Jones Wilshire 5000 index, as an average or a benchmark of the total equity market, has been in a “Rising Wedge” pattern (see here) for four months. As the wedge apex nears, and the trading range narrows, a downside breakout could be triggered once the lower boundary of the wedge is breached. Currently the Wilshire 5000 index is above the 89-day moving average and it is in the downtrend zone right below the rising wedge and has negative readings in both the trend and momentum.

The Leading Wave Index (LWX) indicator, color coded in the price bars of the following daily chart of the Wilshire 5000 index, closed in bearish last Thursday. Based on the forecast from the LWX, the market should be in a bearish time-window until 4/16/2012 which is right before the US tax deadline. The market may look for support at the 89-day moving average (EMA89).

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The Broad Market Instability Index (BIX), measured from over 8000 U.S. stocks, closed at 58 on Thursday. This BIX reading is above the panic threshold of 44 and it indicates that the broad market is bearish. The BIX is plotted in the following chart as compared with the Wilshire 5000 index.

 

 

 

 

 

 

The Fed’s recent inference that QE3 was not imminent has caused physical gold and silver and the HUI and the XAU to breach their downside support lines. These transitions set up the distinct possibility that we could well see $1,500 gold and the HUI and XAU at 400 and 144, respectively! Let me outline my analyses of the current situation and how it might unfold. Words: 386