This is an after the fact analysis. In hindsight things look clearer and they provide an understanding that is very useful in analyzing emerging patterns in the future. Dow made a four year high of 13,289 on March 16, 2012 – Point X in the chart below. Then it retraced to 13,002 (Point A) by…
On May 9th Dow extended its losing streak to six days. History says that the probability of a bounce now is quite high – 79%. Since 1970, Dow has seen a losing streak of six days 58 times (excluding current streak). Of these, 43 times the streak went beyond six days. However, when Dow was above its 200-Day SMA its losing…
Copper is referred to as Dr. Copper because of its unique ability to predict economic trends – and also because it is the only commodity that has a Ph.D. in economics. “Because of copper’s widespread applications in most sectors of the economy – from homes and factories, to electronics and power generation and transmission – demand…
On May 08, 2012 S&P Index ($SPX) made a hammer, at a short term support zone – April ’12 low of 1357 and March ’12 low of 1340. Hammer is a bullish reversal pattern that forms after a decline. (see StockCharts). In this case, the decline has been short – only five days since May 01. Hammers signal a bullish reversal as the long…
Just watched a complementary promotional video by Jeffery Kennedy, Chief Commodity Analyst at Elliott Wave International (EWI). Towards the end of the video – @ 10:10 minutes mark – he explains Elliott Wave principle using CRB Index. I have tried to recreate the chart below – weekly on log scale. According to Kennedy, CRB Index…
The widely expected victory of Francois Hollande in the just concluded French presidential election is going to pose a fresh challenge to the German-dominated policy of economic austerity in the euro zone. Here is from AP: “Socialist Francois Hollande defeated conservative incumbent Nicolas Sarkozy on Sunday to become France’s next president, heralding a change in how Europe…
30-Yr. Treasuries have been in a long term bull market. Take a look at the monthly chart of $TNX — the 30-Yr T-Bond Yields, which trends opposite of the 30-Yr. T-Bond prices. From February 1994 to June 2003 it was in a steep downward trend with rates fluctuating within a downward sloping channel of 160…
US dollar has been a good indicator of risk-off/risk-on trade for quite some time. Whenever investors become unsure of the economic conditions and when the fear level increases they flock towards US treasuries and US dollar. In the currency domain, Swiss Franc and Japanese Yen trump dollar’s safe haven status and they normally go up…
The bad economic news coupled with the downgrade of USA’s AAA rating to AA+ by Standard & Poors have contributed to the worst August start ever. In the first six trading days in August the S&P 500 saw a drop of -13.37% — from the July close of 1292.28 to August 8th close of 1119.46.…
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