\tLet’s start with stocks…<\/p>\n
\tStocks<\/h2>\n
\tThe stock market popped higher out of the gate yesterday. The S&P 500 gapped up to 2400 and then spent the rest of the session trading around that level. As a result, the intraday charts have formed “bull flag” patterns. Take a look at this 60-minute chart of the S&P 500…<\/p>\n
\t![\"\"](\"http:\/\/assets.jeffclarktrader.com\/ee-assets\/channels\/articles\/5-16.png\")
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\tThis sort of a pattern often resolves with another push higher. You can see a good example of this back on April 24. If something similar happens this time around, then S&P 500 ought to be able to rally to the 2411 target area.<\/p>\n
\tThat’s where I’ll be looking to establish some short exposure.<\/p>\n
\tGold and Gold Stocks<\/h2>\n
\tGold stocks popped higher yesterday morning. Then they reversed their gains. The VanEck Vectors Gold Miners Fund (GDX) closed just barely positive on the day.<\/p>\n
\tThis is the opposite of “bottoming action.” Remember, when GDX bottoms, it usually suffers a few days of downside action. Then it gaps lower, exhausts all the selling pressure, and slowly turns around and goes positive on the day.<\/p>\n
\tWe saw the opposite of that in GDX yesterday. I won't call it “topping action,” because we haven't seen enough of a rally to call for a top. But this action should lead to at least another down day or two. And it should give traders a good chance to add exposure to the mining sector at slightly lower prices.<\/p>\n
\tGDX should form a higher low on this pullback – maybe something around the $21.50 level. The 9-day exponential moving average at $22.17 is the next support level. But we could get a quick flush below support just to shake out all the folks who chased the gold sector higher yesterday.<\/p>\n
\tIf you bought into the mining sector last week, and took some profits off the table yesterday morning as I suggested<\/a>, then you’re in good shape here. Be ready to add back some gold stock exposure after another day or two of weakness.<\/p>\n \tI’ll update Delta Report<\/em> readers on these trends throughout the day on Jeff Clark Direct<\/em>.<\/a><\/p>\n \tBest regards and good trading,<\/p>\n \t \tJeff Clark<\/p>\n![](\"https:\/\/casey-assets.s3.amazonaws.com\/images\/misc\/jeff-clark-signature.png\")
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