Here’s my quick take on Gold, Copper, and Oil…
- a drop and hold below 1072.30 on GOLD could, finally, see price retest the 1000 level, or lower, since there is an absence of volume support down to this level, according to the Volume Profile shown along the far right side of the chart
- 1150 = major resistance
Well that was an impressive trend down day yesterday and a lot of technical damage down. I am now officially impressed, and while I had been thinking we might put in the retest high just before the holiday weekend, Greece has pulled that forward a few days and in all likelihood both the 2015 high and the retest are now in the review mirror. This would be a good time to pull together a few reference posts to show where I think we are here.
The first post is from Monday 2nd February where I confirmed that the January close on SPX met the criteria for some very bearish long term stats suggesting very strongly that the best case for SPX in 2015 would be a flat close, and the worst case a large decline. You can see that post here.
The U.S. Dollar is back above the major support level of 95 after a brief break below, as shown on the Daily chart (cash index) below. As I mentioned here and here recently, I believe a large move is coming, one way or the other, in currencies. The RSI indicator is back above the 50 level, hinting that bulls are back in charge of $USD.
Just a very quick post this morning as I needed to take my daughter to the orthodontist and only got back a few minutes ago.
A rare day yesterday with a strong decline sustained into the close, rare in itself but very rare on FOMC day. The wind may be changing. The bulls had to break back up over the middle band and totally failed to do that.
This break back below the SPX daily middle band delivers two downside targets. The first is possible range support in the 1990 area, with the daily lower band just below it at 1987. If that fails then the obvious next target is the 50% fib retracement of the move up from 1820,l and that is at 1957. SPX daily chart:
If it’s true, I’d say bonds are (finally) positioned for a meaningful, sustained fall. I am particularly interested in the similarity of price action vis-a-vis the long-term Fibonacci fan lines.
The social media fund, symbol SOCL, has an interesting relationship with its Fibonacci retracement levels. Its current position suggests weakness ahead next week for this sector.