Gold Stocks Pull Back--Broad Market Stalls

MER: Merrill Lynch has supplanted GM as the ultimate broad market leading indicator and MER is currently flashing yet another bearish intermediate-term signal.


IBD shows 6 distribution days for S&P 500, 5 for Nasdaq, 4 for Dow, NYSE composite in last few weeks. I look for possible surprise from the Fed interest rate announcement.

Gold/XAU Ratio 4.33

"An increasingly recessionary looking U.S. economy will likely require 1% real short rates and 3.5% Fed Funds in order to stabilize a potential growth contraction in lending not witnessed since the early 1970s or, to be honest, Roosevelt’s depressionary 1930s. We can only hope that Bernanke, Paulson, and their cohorts recognize the danger and that the music keeps playing with the lights still turned on." Bill Gross PIMCO Funds