There is still no clear sign on the direction of the stock markets. But there is a lot more volatility these days, so it's advisable to stick with companies which are very stable, especially in the precious metals space.
No matter who gets elected this November in the US, it's going to be a long time before the Fed can stop the path it's already on, if it stops at all. That means more money printing/rate suppression, which will be supportive for the stock market and gold.
Now as far as being long vs short, I'm still 100% long the US market. Why? It's not because of what I think the Fed will do. That's speculation.
My decisions for staying in the Dow start with Dow theory, because it's reliable. The Transportation index has been failing to move to a new all time high to confirm the Dow's move, and the Dow has been taking a breather after making an all time high. This seems benign and even a sign that things are deteriorating, so we need to look closer.
Back in February, the Transportation and Dow indexes made big moves down to new lows. Since then, the Dow went on to make a new all time high, but the Transportation stocks muddled around below their all time highs. However, they are starting to trend upward. This is interesting. It tells me that the lows in January were simply a reset for another unexpected next leg of the bull market. I can deduce this because in a bear market, both indexes will make new initial lows (which happened), but then both will fail to confirm a new bear market low until the bear market is just about over. This happened almost instantly in February. Both indexes made a new low, then made another new low together.
Boom.
Bear market over.
The next quarter should be VERY interesting and I will be watching for signs to back the truck up or empty the cab.
