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S&P 500 versus GoldThe 1.5-year-old declining resistance line (magenta) has proven too strong for the 4 year rising support (blue) which was broken just last week due to the record drop in the US indices. The drop was due to a combination of a market that had been overzealous and priced to perfection in an increasingly deteriorating economic environment. The coronavirus certainly added fear to the markets as it is looking increasingly likely that the service sector globally is going to get hit pretty hard in the coming months. This break-down of a 5-year consolidation, especially with an initial fake breakdown and fake breakout attempt, appears to be hinting at gold outperformance over stocks over the next 12-24 months. The ratio needs to continue putting in lower highs and lower lows to validate the gold>SPX thesis. Central banks response to the carnage in stock markets is going to tell us a lot. How stocks and gold respond to the shift in monetary policy will also be extremely valuable data. I want to stress that with this SPX to Gold Ratio, SPX/XAUUSD ratio, is that we don't know if this pattern is going to break higher or break lower. Breaking higher into a hyper mania similar to 2000 Dotcom is still possible, the next few months will be telling us, but it's also possible we're near the limit that this current stock bubble can maintain. Rates and economic growth were a lot higher in the 90s which you could argue enabled/justified the massive overvaluation. And by many measures (not at all) the current markets are the most overstretched that they've ever been. For example value versus growth is the most skewed its ever been in favor of growth. Commodities are basing at 40-year lows. The gold mining sector versus their own product is the most undervalued it has ever been. If you think gold has the potential to rise 20%, 50%, 150% or more in the coming 1-5 years, then a position in both the metal and the mining sector is a no brainer. Utilizing funamdental and technical analysis we can find the best companies and make timely and strategic purchases over time. Your odds of making a profit are better when you buy something when it is cheaper than normal. Everyone's piling into what's done well for the past several years - that's classic momentum investing and can cost you dearly if we're near a significant top in US indices. I much prefer buying things when they're on fire sale. Be watching how central banks respond and how gold and spx respond to the central banks. This multi-year triangle consolidation is coming to an end and when these triangles breakout in a direction, it is not uncommon for it to be followed by extremely volatile moves in the direction of the breakout that can last for years.
TVC:SPXShort
by Ludwig_Von_Mises
2
DXY Weekly forecast 20th - 25th Jan 2020DXY Weekly forecast 20th - 25th Jan 2020 - Dollar index has not been showing much movement but did do a minor pullback as expected. - During the beginning of the year markets are usually in a corrective structure so this type of movement is expected. - After the first quarter it will be much clearer as to what continuations of the markets will be over the year. - Dxy usually is a confluence for me when trading other USD pairs but over the next few weeks ill be trading less using this as confluence as it has been moving positively with pairs that is usually moves negative with. Ill be basing my trades on USD pairs with direct confirmations from the pairs its self. - Going into this week with Dxy moving bullish towards our key area at 97.80, will watch market at this level for entries bullish but at the same will keep an eye out for a pullback/ stop hunt towards 97.4 area. . . . My weekly forecast, highlighting the overall trend with key levels to get an idea of the best targets in the upcoming week and weeks ahead. Basic projection of the market with technical/fundamental analysis and is to be used for ideas, entry point analysis is done on a daily basis for entries with minimal drawdown.
TVC:DXY
by kieranchow
ORBEX: Look at SPX Volumes for Further Clues!Despite the US-China phase one trade deal supporting equities the upside could be minimized if priced in already since as indices have been moving up since the December truce! Geopolitics suggest more strength, however, technicals indicate otherwise! Will corporate earnings trigger a shift from a macro perspective? Well, either that or weaker US inflation data! It seems that equities hang on earnings and inflation, whereas the US index only on inflation data. Timestamps SPX 8H 01:30 DXY 8H 04:25 Trade safe Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
TVC:DXY
by Orbex
ORBEX: Equities Rally Continues But Risks Remain Elevated!Equities and the US Index hit the levels we expected last week, however, participants remain encouraged on “phase one” and Brexit conclusions. Will the rally keep on in 2020 or have investors really misplaced the recent concessions? The risk of deteriorating relations remains elevated in our opinion! Timestamp DXY 4H 00:20 SPX 4H 02:45 NASDAQ 4H 04:55 Trade safe Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
TVC:NDQ
by Orbex
ORBEX: Look at Yields for Further Clues in Equities!Equities keep climbing higher on the back of renewed trade and Brexit optimism and also on the back of monetary policy decisions! Interest rates are on hold, but the Fed did cut three times in 2019! Will the surge continue into 2020? And if yes, when can we expect the massive sell-off everyone’s been talking about to take place? ake a pick as we near the end of a cautious year! Timestamps DXY 4H 02:10 SPX 4H 04:10 US Yields 06:10 Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
TVC:TNX
by Orbex
ORBEX: DXY Looking Impulsively Bearish After Golden RetracementThe US Index correction up to the 61.80% Fibonacci retracement of minor waves 1-3 missed the 98.66 low of wave 1. This means that the current structure can be still considered impulsive. With bears pushing prices down sharply, the chances of reaching fresh lows for the completion of minor wave 5 are increasing. This scenario could be validated below minor 3's low at 97.10. Should that be the case, the index could extend its losses anywhere down between 95.50 and 96.34! Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice.
TVC:DXY
by Orbex
ORBEX: Has the Santa Rally Started Already?In today’s market insights I explain why equities are not affected by reports that China wants existing tariffs removed in order to proceed with phase one of a deal! Perhaps, investors couldn't care less about the consistent back and forth between US and China before they go home for Christmas... I reveal how I expect the S&P500 to perform in December, and while at it, I also analyse the US index! Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice.
TVC:DXY
by Orbex