1. Gold futures traded well on Thursday, but they're still not above their short-term 5-day and 8-day Exponential Moving Averages. Overall, I'd say gold and miners are overdue for a bounce. And a slight bullish divergence in the Relative Strength Index (RSI) might support such an opinion. However, we've seen too many of these situations stall and roll back over. So although I am optimistic a turn is on the horizon, I'll likely remain sidelined until we get a bit more strength on a closing basis.
2. I continue to receive notes from readers wanting to be bullish on names like Cabot Oil & Gas (COG), Chesapeake Energy (CHK) and Southwestern Energy (SWN), but I'm unable to find anything to like in their charts. The bottom line is that support doesn't exist in horrific bear markets. And I believe we can all agree the independent oil & gas industry is indeed in a horrific bear market. This space will require substantial time to heal, long after an initial short-covering rally takes place.
3. Between the bearish RSI divergence and the fact that it failed to sustain a break to new, multi-year highs, I continue to hate the way Microsoft (MSFT) trades. I'm not currently short the stock, but I'm quickly warming to the idea.
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