--> Gold's intermediate C rise is still underway as long as gold stays above $380. But maturity is starting to set in. Gold failed to rise today while the dollar fell. Gold shares have been stronger than gold for several months, but this is starting to change, which means we have to treat them separately. Silver's declining and it's now vulnerable to further short-term weakness by staying below $5.20. Time wise, gold's C rise could end at anytime or it could last several more weeks. It's important to remember gold's C rise is underway above $380 and if the September 24 closing high at $388.40 (basis December) is broken, gold still has a chance to reach $400 or higher before it's over. But if it closes and stays below $380, the C rise is over and the D decline will begin. D declines tend to be the worst decline in the intermediate cycle, but in a bull market the D lows will be higher than the prior B, which is the July lows at $342. The D decline low could conceivably end up near the $355 to $360 level. It's important to remember the major over two year trend is up above $340. The HUI nd XAU gold shares indices closed below their 5 week moving averages for the first time since July. This means if they now stay below 200 and 93, respectively, the super strong rise is over because their indicators are starting to decline from an overbought level. But even if HUI and XAU decline to 176 and 86, their ongoing rise since March would still be solid. Gold shares may be leading the way for the upcoming D decline.
Considering the overall situation, now's a good time to take some intermediate gold share profits. Sell some of your gold and silver shares. But very important, keep at least half of them. We should always keep a core position as long as the major trend is up, but don't buy new positions until the upcoming D decline is near an end. Don't sell gold. Platinum is strong above $692 while oil is rebounding.
The U.S. stock market is volatile. The 6½ month rise is still underway, but if the market fails to close above the September 18 highs at 9659 on the Dow and 1039 on S&P 500, the market will continue to lose steam. Stocks have been declining with the dollar, which makes today's stock rise and dollar fall unusual. If the Dow and S&P close and stay below 9280 and 995, respectively, the rise will be over. Keep an eye on 9659 and 9280 on the Dow because whichever way it breaks will tell the next trend direction. Be quick to sell your positions if your 4% trailing stops are broken. Don't buy new positions.
U.S. bond prices continued to rise while stocks fell this week, reaching an 11 week high yesterday. Plus, bonds held up well today in spite of today's stock rise. The seven week rebound rise reached our target level. But since bonds have room to rise further, if you have bonds, continue to hold a while longer in order to sell at the best price possible. Bonds will remain strong within the rebound as long as the yields stay below 5.05% on the 30 year and 4.10% on the 10 year. Don't be surprised if the yields decline to test the June lows (June highs on bonds). If you're still holding bonds or TLT, keep them unless the yields close above the mentioned levels. We'll likely be selling within the month.
The U.S. dollar continued to fall this week, closing near its June lows today, which is probably why bonds held firm. The dollar index is near our first target at 92 and the"moment of truth" is at hand. If the dollar index now closes and stays below 92, the next leg of the bear market will begin. Meanwhile, the dollar index is very weak below 95. The currencies are rising sharply. The Australian dollar closed at a new high today while the others are either at the June highs or approaching it. The currencies will remain strong above 1.135 euro, 1.625 British pound,.7350 Swiss franc,.6650 Australian dollar,.5880 New Zealand dollar,.8700 yen and.7370 Canadian dollar. Keep your positions and ICPHX. FAX, FCO and GIM closed at or near the highs today. Continue to hold for now.
Most world equity markets are down but Mexico closed at a new high today and Hong Kong remains strong. EUROX, EWS and INR are at the highs while EWW, TDF and INW are near the highs. Keep them unless your 4% trailing stop is broken. Sell TTF.

Warm wishes and until next week, Pamela and Mary Anne Aden