This week, the US Dollar Index has recovered slightly, and price finds itself above key resistance and attempting a new swing high. What might this mean for commodities? First, the US Dollar Index is breaking above a consolidation pattern, which was preceded by a positive momentum divergence. Should price break the $73 level, the next…
One of the major intermarket relationships is that of the US Dollar Index and various Commodity Prices. Generally, the US Dollar trades strongly inverse commodity prices. Let’s look at it before discussing it further: Typically, a falling US Dollar index is inflationary, and inflation occurs with higher commodity prices (I am using the CRB Index…
I wanted to highlight a few key technology stocks that are bumping up against overhead resistance, whether via the 200 day moving average or prior price levels. Let’s start with everyone’s favorite: Apple, Inc ( AAPL ): AAPL is actually trapped between two levels of prior support/resistance, and should have massive support about the $145…
Let’s pull the camera back on the market to see where the S&P is on a monthly chart for broader insights: Currently, price is trapped between its 20 and 50 period exponential moving averages. The last time this happened was in 2001, right in the middle of a major bear market move. Are there similarities…
Continuing our brief study of intermarket relationships, let’s look at two markets with a powerful negative correlation: The US Dollar Index and the Gold Market. Gold traditionally is a hedge against inflation, and inflation often is correlated with a weak dollar and higher commodity prices across the board (which is the environment we see now)….
Intermarket analysis is a fascinating branch of market research, and I wanted to show you the performance of gold and the US Stock Market. There’s been an inverse relationship, such that when gold rises, the market is generally falling and vice versa. Gold is traditionally seen as a hedge against inflation, and inflation typically is…
I’m not sure how much you follow intermarket correlations, but there’s one relationship I’d like to highlight to you. The S&P 500 Index has been extremely correlated with the 10 Year Treasury Note Yield ($TNX), and continues to be so today. Generally (as demonstrated over the last 100 years, but not over the last 10…
As I always recommend, take a look at your chosen market and chosen time frame and annotate the action and ideal trades for the day, so you can better analyze these patterns in real time. Let’s look at the DIA (Dow Jones ETF) on the 5-minute chart (any of the 3 major US Stock Indexes…
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Apple Inc (AAPL) completed its buy signal and is running into potential overhead resistance which could temporarily halt the growing up-move in the stock. The buy signal I highlighted previously worked even better than I anticipated, with price gapping up multiple days to reach the first profit target – the resistance line at $170. Traders,…