Some Euro Zone Markets Giving SELL signals

Monday Dec 2, 2013
Some Eurozone Markets have started giving SELL signals. These include British, French and Italian markets. Japanese market keeps on going up as the Japanese Government continues to weaken its currency to near 103 yens to the dollar compared to only 75 yens a year ago.

FTSE 100 Index  For the last 15 trading sessions, FTSE has been weak.

French  CAC 40 Index

Italian  MIB IDX

Similarly Australian Market has been Weakening
ASX 200 Index for the last 15 sessions has been weakening and have given SELL signal

US markets are giving  topping signals on Candle stick charts

DJI

SPY

TZA

GLD  Gold is weak again this morning even though demand for Gold Bullion is at highest levels in countries like China & India. Demand in India is being restrained by Govt of India to save foreign exchange reserves.

GDX is retesting its recent lows 90% of advisers are bearish on Gold at this time . So a rally cannot be ruled out at current levels or after Gold goes down near $1200

We do not believe there will be any taper this year . Taper may not start till next year. The reason is that if that happens, the 10 year rates will first go to 3 % and then to 4%. If that happens , the interest on our outstanding debt will be so high that we will not be able to afford it. This is the same situation in Japan. They cannot afford to increase their 10 year rates to go up beyond 1%.
Let us look at current debt vs GDP for the highest indebted countries(Wall Street Journal)

Japan's Debt to GDP is 238%. USA ratio is 105.6% . Here we are in the company of Portugal, Italy, Ieland, Greece and Japan which have the highest ratios.




Let us look at the chart of GLD in more detail
GLD 2 years

Look at GLD (Gold ETF) for the last 6 months
We are completing Leg 3 of (5). It will be followed by leg 4 up and then leg 5 down of (5). So we are getting close to the final bottom.