Monday, September 04, 2017

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Thursday, June 05, 2014

Oil repeating its pattern

Take a look at this daily CL chart. Oil is forming the same pattern it did at the beginning of March and in Mid April.

Target of the move down around 100 followed by a move upto 106. Of course if 104 is really rejected in August, then that upward move is broken and we have room to move downto the 90 area.

Screenshot 2014-06-05 10.33.50

Wednesday, November 06, 2013

Making sense

Look at the bigger picture, if what you see makes no sense

Monthly 2013-11-06

You are looking at monthly charts (left to right, top to bottom)

EUR / Pound / Yen

Gold / S&P / Dow / Oil

These charts go from 2009 to 2013 and they tell a story.

The pound is rangebound, while the Euro failed to reach the channel highs, instead stalled below the 61.8% Fib

Euro monthly 2013-11-06

or not?

20 years Euro and GBP side by side

Euro and GBP monthly 2013-11-06

The Yen building a base for the next leg up. Look at 20 years of Yen trading to see it building.

Yen monthly 2013-11-06

Gold is another story. The once mighty has fallen from the grace …
There are two lines in the sand, and they are not so far away.

Like the Yen, Gold might be building the base to break lower, but while I see the Yen reaching above 125 on the next long term leg up, I see Gold struggling to break below support. I see Gold moving in a range between 1200 and 1450 in the years to come, supported by the realisation, that pysical gold remains finite, while paper can be printed (as long as others are willing to buy).

Gold monthly 2013-11-06

Can stocks go higher? Sure they can! Does it look so? Well, there is a 4 year trend now in place.

But let’s look at 20 years S&P

ES monthly 2013-11-06ES monthly 2013-11-06-2

We are at the 138.2% extension of the 2002 to 2008 leg up, which was followed by a “false” breakdown and move to new All Time Highs. Next target is 1937, lets call the round number 2000, which will provide a lot of resistance.

But to get there, we will need a base in the 1666-1602 area. And when we break down to this area, the newsies will call it the end of the world as we know it. Down is such a strange conception after 4 years up.

At last let’s talk about oil. It’s back into its year long channel. Its going down to 90-88 and will bounce.

Winter is coming

Oil monthly 2013-11-06

Enjoy it cheap, while it lasts and trade the range.

Wednesday, October 16, 2013

US Default 1 Day ahead

Noone really belives that! Markets are irrational, but if any other country in the world would dare to mention

“Sorry folks, there might be a chance, that coming Thursday, we will not be able to pay our bills. It’s not because we could not print any more money, but because we are not allowed to use our printing presses any longer.” …

Well, the Euro was doomed in the eyes of the markets, because Cyprus had to close it’s banks for a few days. Tomorrow the US of A might not be able to pay its bills, and my charts look like this:


These are daily charts from left to right EUR/USD, GBP/USD, USD/JPY and below Gold, S&P, 30y Bonds and Oil.

Given a rumor of the magnitude we are faced with, I would expect the USD and S&P in the cellar, while commodities are soaring, with a relief rally afterwards.

In numbers I would expect

EUR/USD at 1.48, GBP/USD at 1.68, USD/JPY back to 0.93, Gold at 14xx, S&P barely holding 1600, Treasuries around 125 and Oil around 120 at least.

Instead we get: Euro and GBP on hold for a month, Yen on hold, Gold down, S&P reaching new highs, Bonds trying to reclaim lost territory (they came already down from lofty highs earlier in the year) and Oil down

Never try to outthink the markets. I will stay out of this, as it makes no sense to me.

But …. Maybe, just maybe the markets have reverted to: Buy the rumor, sell the bad news … Kind of what you would expect from a rational market….Markets are irrational, can’t be that reasonSmiley