Posted Mar 24, 2016 by Martin Armstrong
Today will be the close for the week and this will be an important indicator. A closing in gold below 1237.50 will warn of weakness. We have important technical resistance at the 1245 level and a closing back below that breakout line will also warn that the upward momentum is starting to decline. Gold bounced off of the Weekly Bullish Reversal and came within 30 cents. That is not a very good indication that a continued rally should be expected. Typically, those who trade emotionally end up buying the high in anticipation of further advancement.
When we look at the Dow Jones, here too we failed to exceed the Weekly Bullish at 17750 after reaching only 17648. Last week’s closing was 17602 and a lower closing today will warn that the advance is starting to fizzle out. We have not been able to exceed the downtrend line technically. A closing below 17124 would be an outright sell signal.
Looking at the euro, the peak came in the week of the 17th at 11342. We do not think we can reach that 11600 level. In the case of the euro, the market has been unable to exceed the breakout line which currently stands at 11400. The oscillators are turning down as well. A closing below 11214 will be bearish, and a closing below 11087 will be a serious sell signal. Thereafter, a breach of the 10700 level will be devastating.
In Crude, the breakout line stands at 4347. Here too, we stopped just shy of it. We already elected a Weekly Bearish last Friday. The next key area to watch will be the 3400 level.
Overall, we are looking to May to provide the next turning point. So pay attention. If we start to elect bearish reversals on the weekly level, we may indeed see a decline unfold.