Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Chartwork on Oil (by Mike Paulenoff)

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Nearby NYMEX crude oil futures have the right look and the requisite underlying internals to suggest that yesterday's low at 93.42 and this morning's low at 93.81 ended the decline from the July 26 high at 100.62. If that proves to be the case, then as long as 93.75/42 remains intact as key support, oil likely is starting a recovery rally that should revisit key resistance at 98.00-98.60. If hurdled, it will trigger upside continuation to 100.00 for a test of the July highs.

Wouldn't that be perplexing while everyone is fixated on the potentially intensifying global economic slowdown?

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Originally published on MPTrader.com.

Gold Getting Crowded (Mike Paulenoff)

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About six sessions ago when spot gold was climbing towards its May-July resistance line ($1551) and EUR/USD was pressing lower towards its May-July support line (1.4170/80), I made a judgement call: I decided to buy the euro into its support line, looking for the end of its 9-week bullish consolidation pattern, ahead of a powerful thrust that projected to new highs above 1.5000.

At the same time, I decided to forgo entering the long side of gold — the SPDR Gold Shares (GLD) — into strength, which usually is a mistake, and instead looked for gold prices to pull back before entry.

Well, that turned out to be exactly the wrong decision, didn't it? EUR/USD plunged 4 BIG figures and sliced beneath all key support points between 1.4170 down through 1.3970 — into and below its rising 200 DMA at 1.3910. Meanwhile, spot gold prices never did pull back at all and just continued to climb from $1545 above its resistance line at $1551 towards its May (all-time) high at $1577.60, which was hurdled today!

In other words, gold turned out to be a "no-brainer, no-stress" position, while long EUR/USD turned out to be a nerve-racking, highly stressful, and unprofitable long position. What now?

From my technical perspective, the psychology underlying long euro versus long gold has changed significantly in the last couple of sessions. Right now, EUR/USD remains a very discredited, almost hated, currency, especially after it wiped out lots of longs in the recent plunge. No one wants euros … and everyone wants gold, which is an "upside-down" psychology that warns me that long gold has become an exceedingly dangerous and crowded space, which will require a significant bullish catalyst to continue higher.

The euro, on the other hand, looks to me like it ended a correction yesterday morning at 1.3835, where it managed to recover to, and accelerate from, its rising 200 DMA. If my work proves accurate, albeit a week too early, EUR/USD has started a new upleg — as difficult as that is to believe given the issues facing the PIIGS.

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Originally published on MPTrader.com.

Big Oil Bell Curves (by Trade Flight Plan)

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CL is offering some nice moves between daily bell curves (value areas) lately.  89.50 lows were support set back in February.  The bottom three S/R levels were set back in February.  The others frame key price levels from the past two months.

The two most prominent bell curves the past two weeks are at 90.50s and 95.50s.  Those 95.50s were also May lows.  A break on increased volume above 95.80s can see a retest of 97.80-99.00.  A break on increased volume below 95.00s can revisit 93.00-93.70, possibly more.  We are neither bullish nor bearish on oil – all we have are targets on both sides of this middle zone.  Intraday setups will guide the way and the end of the month promises to be interesting.

With an average daily volatility of roughly $2,000 per contract each day lately, oil has been moving nicely and offering some sweet intraday setups.  These will be the topic of future posts.

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