There are enormous cross currents at work in these screwed up markets at the moment so traders make sure that you do not bet the farm on any one trade. Someone else is liable to own your farm! These are some of the most difficult to read markets I can recall seeing in my entire trading career. The day to day run ups in price or selloffs are brutal and are being compounded by an increasing number of traders getting fed up with the constant whipsaws and thus exiting their positions leaving less liquidity and more volatility and unpredictability as a result.
[UWTI 60min log scale]
It just goes to show how the same principles in technical analysis apply to any asset in any market. Although I was on my way to becoming a permabull in crude oil, I couldn’t help but agree with pundits that said crude’s drop below the trend line and back test was bearish. It’s slipping and today’s (good) EIA oil supply report didn’t make any difference. Crude seems to use news events to make the moves it wants to and not the moves the new events would imply.
Here’s a detail from the recent week’s market. The top trend line is the long term one going back to the start of the rally in crude from March 18 onwards.
WTI has stopped at the lower trend line but it doesn’t make me feel too bullish, for rest of the week at least. My guess is that the next few days will bring about a good, lower entry point (dip).
[WTI 60 min]
On the plus side, the long, 17-year trend line is still below all of the recent activity and has been since April 30th when it broke up through it. That would put firm support at about $59 to $59.25 for the rest of May. Or maybe I’ve drawn it wrong… Still learning this stuff.
[WTI daily log scale]
Note the MACD bear cross in the last chart. That kind of says it all for the next little while.
NEM appears to be a good proxy for the miners…We have a potential double top with negative divergences on the RSI 5 and 14…Look what happened at this point last August. Again, divergences can be negated–something to watch.
NOTE: NEM CLOSED TODAY AT THE HIGH LAST AUGUST $27.31…INTERESTING TIMES…GDX was 7 cents shy of the 200 MA today.
Bonds , Gold , Oil and Nat Gas
Special release for Goldtent
The 60 minute channel remains intact; however, the 5 minute can and often does give warning signs. This back test could denote an early warning sign for DUST 60 minute…
grin’s 30 MIN DUST chart MACD remains below zero EOD–bull case needs to be above
While there’s clearly been a negative divergence between price and RSI, and a subsequent drop in price too, this daily chart looks rather upbeat with the matching trend on the RSI lows. Also the recent bounce off (near) the RSI lower trend line suggests some core strength is still in crude.
I drew the RSI trend line from the two points on the RSI that corresponded with the two points on the chart that formed its lower trend line.
Another idea for Goldtenters