S&P 500: Is the Rally Losing Steam?

Published 01/16/2025, 11:30 PM
XAU/USD
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US500
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GC
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GDX
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  • SPX Monitoring purposes; Sold long 1/6/25 at 5975.38 = gain 1.59%; Long SPX on 12/31/24 at 5881.63.
  • Our gain 1/1/24 to 12/31/24 = 29.28%; SPX gain 23.67%
  • Our Gain 1/1/23 to 12/31/23 SPX= 28.12%; SPX gain 23.38%
  • Monitoring purposes GOLD:  Long GDX on 10/9/20 at 40.78.

We ended up 29.28% for 2024; SPX up 23.67% for the year. The above chart looks at the shorter-term timeframe. The bottom window is the 3-day trin, next higher is the 5-day trin and next higher is the 10-day trin. We like to see all three moving averages of the TRIN reach 1.20 or higher as that shows panic in those timeframes and panic only forms near lows. We shaded in pink the times when all three timeframes reached bullish levels.SPY-Daily Chart

The last time all three reached bullish levels was last September. The 3-day trin stands at .96; the 5-day trin at .93 and the 10-day trin at 1.03 and all three not near bullish 1.20 levels suggesting current rally may be short-lived.SPY-Daily Chart

This week is option expiration week which lean bullish. Page one show 3, 5, and 10-day TRIN and all are 1.03 or lower and not at panic readings to suggest a last rally; readings near 1.20 and higher would have been ideal. Market is rallying but does not have enough energy (panic) to go far. We did list the trin closes that are near or in bullish levels in blue on the chart above and all came in near the  585 SPY level; which did suggest support. Today’s open did produce a gap (shaded in pink) and at some point will be tested. There is a gap above (Shaded in pink) near the 600 SPY that may be tested and the next high.

A stronger setup may come late this month according to seasonality. Staying neutral for now. The bigger trend may be toping (according to the 63 and 100-day TRIN).GDX-Daily Chart

The bottom window is the 18-day average of the up-down volume percent for GDX and next higher window is the 18-day average of the advance/decline percent for GDX. These two indicators are good in helping to define the short-term trend form GDX. When both indicators are above -10 (both are +3 range) the short-term trend for GDX is considered up. We noted in light green the times when both indicators are above -10 and in pink when both indicators are below -10. The chart above goes back about a year and 80+% of the time it’s been in the light green area.

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