Before I move on from sentiment, as you know we just suffered the worst mass shooting terror attack in the nation’s history. My prayers are with the victims and the families. Like you I am totally grieved by this horrific event. But here’s the bottom line as it relates to our work. I’ve heard people say this was a hate crime, a terrorist attack. That is true beyond a shadow of a doubt. Others said it was a tragedy. Overall, the overriding sentiment of many is they were shocked and surprised that it happened. Why should anyone be surprised? The FBI has active cases against Islamic terrorism in all 50 states. But as security expert Sebastian Gorka said, this isn’t a tragedy like an Amtrak derailment. There is an ideology at war with the West. This is an act of war many don’t understand. We may not choose to be at war with them but they are at war with us and this isn’t a conventional type war. I bring this up because the experts tell us the Brexit vote isn’t factored in the market. That being said, if an attack like this could shock so many, chances are there’s a lot of things to come that are not priced into financials markets. As you know I view this market as a hybrid between 1968 and 1939, both pivotal and violent years put in final or secondary highs before brutal bear markets. There is nothing I see out there that gives me any evidence to the contrary.

One of the brightest surprises of the year thus far has been the precious metals. It surprised by going parabolic at that horrible jobs number a couple of weeks ago. But I’ve had an incredible breakthrough with my work. A hundred years ago Gann taught that when price and time square the trend changes direction. Those of you who’ve read my articles in this magazine know I’ve done some of my early squaring out work here several years ago starting in 2011. But now I’ve uncovered very complex square outs on most charts and nearly all time frames. Here’s a wonderful example given to clients on a timely basis last Tuesday night. You can see the lower chart without the move up as the opportunity was identified to our clients on Tuesday night. I don’t just show folks the after the fact, we actually identify this stuff before others figure it out. 

The gold chart pulled back into the parabolic bar from the jobs report at the 1236 handle on a pullback of roughly 36 hours. The next day it was on the launching pad again. Now it is roughly 80-81 hours up from that breakout with a price handle of 1281 spread out over those 2 topping bars which come in at 1281.2. To be sure its extended and should back and fill.

So for the second week in a row I’m heavy on psychology because it’s an extended market and the story of the week is complacency everywhere I look. Right now we have an excellent chance to drop and let’s not forget the seasonal change point for June has these two major events as we are also coming to June 18 which is golden spiral 6/18 which can also be a major turning point. This year it happens on the weekend. But I’ll leave you with this clue. If the chart you are following is sitting in the 61 handle by the end of the week, there’s a good chance it will square out with the date. That means a chart moving into the 61 handle on Friday has a great chance of going the other way when trading resumes next week.