I am not yet convinced that this correction is over, although it might be.
Corrections after breakouts USUALLY, but not always, result in pull backs to the breakout line. So far that has not happened on this breakout, and IT MAY NOT HAPPEN AT ALL.
Typically there are bottoms formed in late December in many markets especially raw materials markets. We had a bottom near the first of the year. Usually the first quarter is the annual boom in raw commodity prices, so that low MAY be the FINAL low before going to the moon. Prices then would most likely temporarily top out in the Spring. The real key for me is whether silver decisively breaks above 33.50 in the next few weeks. If it does, we have seen the low.
Regardless, now is the time to buy PMs. Trying to pick the low means most of the time you will NEVER buy when you should. Better to buy a little high than not be able to buy at all.
Ken Polcari, master trader (damn, that guy is almost always right) thinks we might push to 1490 or so on the S&P, but will have to fill that big gap from awhile back (down to 1420 or thereabouts) before any lasting breakout can occur.
I tend to agree - gaps get filled more often than not. And with Kenny, it's a fairly sure bet. He's on Bloomberg all the time, used to be a floor trader for ICAP, now independent.
I rate him up there with Kyle's long term intuition, for short term "feel for the ticker". If Kenny says market up till the end of the week, it has been 99% of the time, and vice versa. He has made me tons of dough.
Of course, it could always "be different this time" but my gut agrees with his.
Corporate profits can't stay at all time highs - they mean revert to the basic trend, or always have in the past. Especially when they get that by cost cutting - jobs - no customers anymore.
As far as PMs, or gold in particular, the 50 sma system is saying "we either break the resistance, or bounce off again, and we'll know in a couple days". Everything else is very bullish for gold right now. Debt ceiling....almost 100% correlation with price of gold, and we all know that despite the demented dance of the clowns in DC it will be raised with very little spending cutting going on. When we get out of the time when the "seasonal adjustments" to jobs are larger than the jobs numbers themselves, they're not going to be pretty at all. The only question in my mind is does the recession happen in the first or second half of this year.