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70 Second Market Outlook – Metals, Dollar, Bonds, Stocks, Energy
Chris of Technical Traders (author this article) will be contributing to the Market Shadows newsletter to bring us excellent weekly analyses of the stocks and commodities markets.
The latest newsletter, Fun With Numbers, is now posted, here. In it, we cover the jobs report from last week, the economy (with the rise in food stamps telling a different tale than the Household survey - info. via Zero Hedge), liquidity - there's plenty of money floating around to keep stocks elevated, technical analyses of stocks and commodities, and more. ~Ilene
70 Second Market Outlook – Metals, Dollar, Bonds, Stocks, Energy
Over the past year some really interesting things unfolded in the market. Investing or even swing trading has been much more difficult because of the wild economic data and daily headline news from all over the globe causing strong surges or sell-offs almost every week.
For a while you could not hold a position for more than a week without some type of news event moving the market enough to either push it deep in the money or trigger a stop loss. This has caused a lot of individuals to give up on trading which is not a good sign for the financial market as a whole.
The key to navigating stocks which everyone thinks are overbought is to trade small position sizes and focus on the shorter time frames like the 4 hour charts. The 4 hours charts are my secret weapon. They provide large price swings which daily chart traders focus on while also showing clear intraday patterns for spot reversals or continuation patterns with precise entry/exit points.
While I could ramble on about why the stock market is primed for major long term growth, I will keep things short and simple with some 4 hour and daily charts for you to see what I’m thinking should unfold moving forward.
Keep in mind, the most accurate trading opportunities that happen week after week are the quick shifts in sentiment which only last 2-5 days at most, which is what most of my charts below are focusing on…
Dollar Index – 4 Hour Chart
This chart shows a mini Head & Shoulders reversal pattern and likely target over the next five sessions. The dollar index has been driving the market for the past couple years so a lower dollar means higher stock and commodity prices.
Dollar Index Trading
Bond Futures – 4 Hour Chart
Money has been flowing into bonds for the past couple weeks with most traders and investors expecting a strong correction in stocks. As you can see the price of bonds hit resistance this week and as of Thursday has started selling off. Money flowing out of this “Risk Off” asset means money will move to the “Risk On” investments like stocks and commodities.
Bond Futures Trading
Gold Futures – Daily Chart
Gold is stuck in both categories. It is a “Risk Off” safe haven when people are scared of falling stock prices, and it is also a “Risk On” speculative investment when people are feeling good about the market. Gold has been trading at key resistance for a couple weeks and looks as though it’s starting its next rally.
Gold Futures Trading
Silver Futures – Daily Chart
Silver is in the same boat as gold though it carries much more volatility than gold. Expect 2-4% swings regularly and sloppy chart patterns in this metal.
Silver Futures Trading
SP500 Futures – Daily Chart
As much as everyone hates to buy stocks up at these lofty prices I hate to say it but I think they are going to keep going up and they could do this for a long time yet. If the dollar index continues to break down then I expect the SP500 to rally another 3% from here (1500) in the next 1-2 weeks.
SP500 Futures Trading
Crude Oil Futures – 4 Hour Chart
I have not been paying much attention to crude oil in the past few months. While it has had big price action, many of those big days took place on news causing an instant price movement making this extra dangerous to trade. I continue to watch rather than engaging.
Crude Oil Futures Trading
Natural Gas Futures – Daily Chart
Natural gas has been a great performer for us in the past 6 months as all the short positions were slowly covered. I just closed out my natural gas ETF trade this week with a 31.9% gain and plan on getting back in once the chart provides another low risk setup.
Natural Gas Futures Trading
Trading Conclusion:
In short, the dollar index along with bonds should will correct over the next few weeks. That will trigger buying in stocks and commodities. Natural gas dances to its own drum beat. The dollar does not have much affect on its price, and most of the time, natural gas is doing the opposite of the broad market.
Get My Pre-Market Trading Analysis Video and Intraday Chart Analysis EVERY DAY, www.TheGoldAndOilGuy.com. ~ Chris Vermeulen
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Love to agree with you:
http://richcash8tradeblog.blogspot.com/2012/10/options-overnight-romney-rally-or-obama.html
Hey if you think stocks look so tasty, go ahead and buy em up.
energy is up as expected. it might not stay up.
http://covert.ias3.com/expose/
I've got a chimp here who begs to differ
I want my 70 seconds back.
Bob Janjuah will have nightmares if he sees this. He promised a correction to S&P : 700.
Mrc Faber must be smiling like a cheshire cat; "I am as much long as I am short. So I don't mind which way it goes.
Hopium suits me fine!"
There you are, as Manckiewicz said in his film : Making you first million is an achievement; going from 100 million to 110 is inevitable...
PS : This guy predicts the USD index heading south, the opposite to what CHS and BK have said.
On Merkel's Gamble | ZeroHedge
Guest Post: What Will Benefit From Global Recession? The US Dollar | ZeroHedge (admittedly on a much longer timeframe *)
* ...While I could ramble on about why the stock market is primed for major long term growth, I will keep things short and simple with some 4 hour and daily charts for you to see what I’m thinking should unfold moving forward....(from post).
AND NOW HERE AS POSTED BY TD :
Two Charts To Strike Fear In The Heart Of Euro Bulls | ZeroHedge
Yup!
FB.. party like its 19.99..buy buy buy
Get in now people! You're missing the train! Get in! It's your last chance!..This is the only way you'll be able to put your money to work!
You can trust Us this time...and no, the Federal Reserve ZIRP has nothing to do with investing in legitimate equities that are going up due to strong fundamentals..
Buying gold and silver is just stupid!
Don't fight the Fed!
I've run out of pro Wall Street propaganda, for now..please add your favorite BS Wall Street propaganda below..
"People will have to buy equities because they are getting no return from treasuries" (no 50% losses either, Wall Street).
"Long term investing is the way to realize your retirement dreams" (We need long term money to milk for fees and gambling).
"Investing in the markets provides capital for jobs and productive American industries" (Putting your money in the markets gives us cash to pay ourselves bonuses, increase profits by cutting benefits, salaries and jobs, and greases the wheels for moving production overseas).
You forgot this one; "Buy treasuries because they are safe and with negative rates on some bonds already you can now pay Uncle Sam to lose your money."
Although I think that the last bit is in the fine print of the bond.
This train I mention more resembles the train to Auschwitz..Even if you invest in metals the fucking American Stasi will steal it back from you...
Buy low, sell high, take profits and buy physical. Rinse and repeat as necessary and as margin hikes dictate.
keep wasting your time with ta. in the fed abortion known as the us equity market its meaningless.
yep investing in stocks is the ticket, why would anyone not? sorry jack I'll stick to investing in the dice, there at least I control my risk and I do have some control of the roll..golden arm and such. seven come eleven baby needs a new pair of shoes.
This is great.... NOT!.. or NOW!.. oh dear terrible.....
Nikkei down 2% tonight. Recession / Depression in full swing.
My crystal ball makes better predictions than this.
well, i have received chris v's daily for a year (ending soon) and if he thinks something about something, check your watch. christ, hes all over the place. one minute we are going to the moon, next we are going to sell off hard for weeks. you must learn to read thru his typo's. tricky tho when he writes "not" instead of "now" and other such faux pas.
you jump into socks first honey-I'll be right behind you.
http://www.youtube.com/watch?v=UC9sRIsvjXI&feature=related