Tag: technical analysis

Is Another All-Time High Ahead For Palladium?

Posted on by Aibek Burabayev

Before we start to analyze the mighty metal, I would like to mention that the crude oil futures Buy Setup was triggered last Friday as the futures price broke above $52.25. Please mind the risk if you trade and I wish you good luck there.

Now let’s get down to the metal. Earlier this year, we pushed a new Pendulum with regular champ palladium on board. Before you bet for Pendulum winner, I tailor charts for pitted instruments and so I did for palladium using the daily time frame. The outlook was quite ambitious as the bullish target was set at $2140 while the price was hovering around the $1900 level. The majority of you chose the former winner palladium as a new winner again against the logic of the experiment and I don’t blame this choice as this precious metal hits all charts amid strong demand. That target was reached within a week after the post had been published.

I detected a promising pattern on the daily palladium chart and I would like to share it with you as it still emerges.

Palladium
Chart courtesy of tradingview.com

Palladium futures hit the all-time high at $2427 on the 23rd of January. It’s quite natural that the correction followed as traders have booked profits after the price reached another record. Continue reading "Is Another All-Time High Ahead For Palladium?" →

2020 Stock Market - What To Expect

Posted on by Chris Vermeulen

Quite a bit has changed in the global markets and future expectations over the past 4+ weeks. Q4 2019 ended with a bang. US/China Trade Deal, US signing the USMCA Continental Free Trade Agreement, BREXIT and now the Wuhan Virus. On top of all of that, we’ve learned that Germany and Japan have entered a technical recession. As Q4-2019 earnings continue to push the US stock market higher – what should traders expect going forward in 2020?

Volatility, Sector Rotation, and Continued US Stock Market Strength.

Our researchers have been pouring over our charts and predictive modeling tools to attempt to identify any signs of weakness or major price rotation. There are early warning signs that the US Stock Market may be setting up for a moderate downside price rotation within the first 6 months of 2020, but we believe the continued Capital Shift that has been taking place over the past 24+ months will continue to drive foreign investment into the US and North American stock markets for quite a while in 2020 and 2021.

The interesting component to all of this, which should keep investor’s attention and really get them excited, is the chance that some type of foreign market disruption may take place in 2020 and 2021. There are a number of things that could potentially disrupt foreign market expectations.

First on the list is this virus event in China (that seems to be spreading rapidly). Second would be the news that Japan and Germany have entered a recession. Further down the list is the very real possibility that many Asian and foreign nations could see a dramatic decrease in GDP and economic activity throughout much of 2020 and 2021.

It is far too early to make any real predictions. Still, traders need to be aware of the longer-term consequences of global markets entering a contraction phase related to a confluence of events that prompts central bank intervention while consumers, financial sectors and manufacturing and industrial sectors are pummeled. Imagine what the global markets would look like if Continue reading "2020 Stock Market - What To Expect" →

Crude Oil: Buy Setup With 1:6 Risk/Reward Ratio

Posted on by Aibek Burabayev

Last time I updated on the crude oil futures in May 2019, I asked if “You Were Waiting for Crude Oil at $20”. Both the weekly chart and the monthly chart had a bearish outlook as the price of crude topped at $66.60 and then it plummeted below $60. The targets were set between $32 and $22. Check out the poll results below.

Crude Oil

Most of you voted that the price would tag the former bottom of $26. As we know now, the price indeed dropped heavily, but it couldn’t break below $50 and bounced back up from there. So the majority result was the closest call, although with a considerable difference.

The chart structure had changed since then and I am happy to share with you the emerging buy setup for crude oil futures with a considerable reward opportunity. Let’s start with an updated weekly chart below to see the idea. Continue reading "Crude Oil: Buy Setup With 1:6 Risk/Reward Ratio" →

Visualizing Correlation: Gold Vs. Other Instruments

Posted on by Aibek Burabayev

Some of our regular readers kindly shared their opinion about the gold market correlation with other instruments in the comments section under my previous post. I think it could be interesting for all of us to see what is going on there if we check the correlation between gold and other instruments.

I prepared the visualization of it for you below. The dollar index and the 5-year TIPS (Treasury Inflation-Protected Securities) were named in the comments, and I will add two other top instruments, so please stay tuned.

Let’s start with the Dollar Index (DXY).

Correlation
DXY: blue, left scale / Gold: orange, right scale / Correlation coefficient: turquoise, sub-chart - Chart courtesy of tradingview.com

For more than 20 years, these two instruments were mostly in a negative/mirrored correlation. It just changes from extremely negative to zero correlation with rare spikes into positive territory. Continue reading "Visualizing Correlation: Gold Vs. Other Instruments" →

Gold Hits Second Target

Posted on by Aibek Burabayev

On the 6th of January, gold had hit the second target of $1577 that I showed you last June when we measured the depth of gold bugs love. I will update the big chart for you below to show why this second target is crucial. By the way, this target was the most favored then as you can see in the graph of ballots below.

gold poll

It’s a real miracle that we witnessed the Santa Claus Rally again this year. I updated the short-term chart for gold right ahead of Christmas as I thought the correction would extend itself to delay the rally for a later period. The invalidation point for the bearish scenario was set at $1516 as the price moved almost $100 above that point for someone’s benefit.

gold poll

Most of you voted for the immediate rally as you didn’t expect another drop, and you were amazingly right, again!

I think it’s time to check big charts to adjust our short-term navigation plans. Continue reading "Gold Hits Second Target" →