#GOLD #SP500 We constantly remind readers we’re not gifted with time travel. When “the computer” makes a price projection, the stupid box is completely unable to pull a Dr Who stunt and give a timeframe. It’s a bit like predicting a Brexit date – not possible other than knowing it will happen. Probably! As a result, the safest thing we can suggest is not getting excited about a share being “cheap” if a ruling sector trend suggests downward travel.
The Oil Sector is presently in a slightly scary place
with some truly foul potentials. As a result, Oil Shares doubtless face a bumpy
ride if the sector wanders below 8,214 points. We’d regard this as the trigger
for reversal to a harmless looking 7,985 and hopefully some sort of bounce.
Alas, we’d suspect any bounce shall prove short lived – especially if the
initial surge down breaks our 7,985 target level.
The implication of a break will signal the risk of
continued weakness down to 6,230 points, perhaps even a bottom at 4,749 as the
“ultimate” point at which a proper rebound can be hoped. This, unfortunately,
even makes some visual sense.
We’re not optimistic about the sectors chances but near
term, there is potentially the opportunity to map sector strength. Above 8485
points calculates with an initial potential of 8624 with secondary, if exceeded,
coming along at 8801 points. This will at least challenge the most recent
uptrend and allow a longer term 9,154 points along with confirmation the entire
sector is “rangebound” for the present.
#Brent #DAX It’s been nearly a year since we last irritated ourselves (link) with a look at the clown farm, The Banking Sector. Unsurprisingly, it did NOT escape from trouble, it achieved our initial drop target, and now is closing (finally) on our secondary target, the point at which we hope for a rebound.
Or will it?
The immediate situation is of weakness below 3360 still
indicating the potential of 3236 and hopefully a bounce but we’re pretty
concerned. A break below 3236 shall move the index below the long term RED
uptrend and suggest the potential of 3078 making a guest appearance. This would
tend be a jolly poor show as while there will be hope for a bounce as the index
meets the lows of 2016 and the Brexit vote, the impact of breaking the uptrend
since the banking crash of 2009 will easily allow a third target level to make
an appearance, a completely absurd looking 2460.
To be honest, it’s not as absurd as a major attraction
below RED calculating at just 320 points. Obviously, an utterly silly number as
we can surely trust the banking system…
In the interests of fairness, there’s quite a lot
arguing for a recoil if 3236 makes an appearance and it’s certainly getting
close to this target level. If any strength is indeed evident, it could bounce
anytime soon. This being the case, movement now above 3467 should prove capable
of a market lift to 3529 points. If exceeded, secondary calculates at 3840 and a
coming challenge of the downtrend since 2008. We’re not inclined to any optimism
over this scenario, just yet.
About the only conclusion we draw suggests some misery
remains within the retail banking sector but there appears a chance of some
recovery soon. We can hope!
#DJI #FTSE As we ponder an end of civilisation, due to global market reversals, it occurs the UK’s Brexit shambles is “off the hook” for damaging the stock market. Or is the UK still secretly a driving force in world affairs, despite woeful political leadership? Last time we had so many shares needing an update in a single day was immediately following the Brexit vote!
There is still some hope the UK will bottom around
Thursdays low of 7020 points. We shall be alarmed in the event 7007 now breaks,
thanks to our immediate drop target calculating at 6984 points. If broken,
secondary computes at 6906. Hopefully, if this scenario triggers, it doesn’t all
happen in a single day.
There is a chance Thursdays low of 7020 shall be deemed
“bottom” with the result a rebound could occur on Friday. It closed Thursday at
7059 points, needing only above 7098 points to tick the first “bottom is in”
box. Above 7098 allows recovery to an initial comfortable looking 7156 points.
If exceeded, secondary comes along at 7246 points. The initial ambition would
imply a coming bonk against the immediate downtrend. But if bettered, nearly
another 100 points will make a lot of visual sense.
We remain a little suspicious over this reversal. A
drop at the end of July / start August is fairly normal, as is a surprise
recovery which lasts through to September and the end of the holiday season. On
this occasion, the market has certainly retreated further than we’d like but
unless 7007 breaks, some hope exists for recovery soon.
#Gold #DOW #GBPUSD Our previous report (link) proved accurate and now, we’re a little gloomy. Sterling is starting to exhibit similar life expectancy to Epstein’s prison guards. On the other hand, after Brexit, the USA are bound to find UK imports quite competitive. If only the UK still had a reasonable manufacturing industry!
The immediate problem Sterling now faces is an expectation of a “bottom” on
the current cycle at 1.1677. Unfortunately, there’s a heck of an argument
suggesting things could get worse, substantially worse, as the Big Picture
indicates a real bottom should occur at 0.9922 eventually. In addition, there’s
the issue of the RED uptrend which ridiculously dates back to 1985.
We’re perfectly aware some readers were not even born when this uptrend
commenced 34 years ago but unfortunately the market appears not to care about
the age of a faded RED line. The inset on the chart highlights what has happened
in the last few days since the trend broke. Visually, there can be little doubt
the market is perfectly aware of this line. At time of writing, it is at 1.20807
(roughly) with the currency pairing requiring to CLOSE a session above this to
indicate it has all been a dreadful mistake.
Visually, this appears unlikely, thanks to the market acknowledging this
historical trend. On the plus side, anyone opening a short and hoping for the
best (or worst) can emplace a fairly tight stop at 1.2106, this being the
highest achieved since the trend broke. In theory, moves above this level allow
for 1.2327 initially with secondary, if bettered, calculating at 1.2475.
When a major trend such as this breaks, we recommend not holding your breath
while awaiting recovery!
#CAC40 #Nasdaq Unlike Germany, the French index has not (yet) made a commitment for serious reversal. Don’t be lulled into a false sense of security as France rarely misses any opportunity for amateur dramatics. At present trading around 5363, it needs below 5250 to suggest trouble awaits anytime soon.
Below 5250 and we’re looking at the potential for
reversal to 4990 with secondary if (when) broken at 4780 and ideally a rebound.
The secondary should donk against the uptrend since 2011, this alone giving
ample reason for a recoil. We do, however, have a problem with the secondary
thanks to several opening second manipulation gaps. These gaps in logic mean
“bottom” could actually be 4728 points and this gives a large problem, breaking
the historical uptrend.
To cut a long story short, it moves the price into a
region where the “real bottom” calculates down at 3855 points. Visually, this
unfortunately makes sense given historical dips and thus solidifies 3855 as the
point at which a real bounce should occur.
Importantly, this is presently a scenario which has not
come close to triggering. As mentioned, the index requires break below 5250 to
tick the first box in a path which holds quite a lot of misery. We shall be
interested, if the index can somehow exceed 5406 points anytime soon. Allegedly,
if the price breaks above such a level, we can calculate 5508 as our first
ambition. If exceeded, secondary computes at 5630, along with almost certain
#Gold #SP500 Every now and then, stories in the media rumble about Germany and her apparently failing economy. Sometimes the level of hysteria is so absurd, Poland must be carefully watching her borders… . Our April analysis successfully gave upward targets for the DAX. For now, there seems there is a viable threat to exports if the UK Brexit thing goes ahead without trade agreements in place and the chart for The Dax is certainly not terribly encouraging.
To cut to the good stuff, weakness now below 11,550
looks capable of reversal to an initial unspectacular 11,250 points. If (or
rather when) broken, secondary calculates down at 10,775 points, along with a
challenge of the market uptrend since 2011. Only a break of this uptrend would
justify some real hysterics as the index would shuffle into a zone where 7,100
presents a fairly reasonable longer term bottom.
We’ll admit, currently, 7,100 does not appear visually
likely. Instead, we suspect 10,775 shall provide some sort of bounce in the
months ahead. To get out of this mess, the index needs better Blue on the chart,
12,650 at time of writing.
If we look for early warning signals which will suggest
a miracle, Germany requires better 12,160 as this will suggest coming recovery
to 12,400 points. Better still, movement above this level calculates with 12,950
along with the promise of further strong recovery.
For now, it’s regarded as heading to 10,775 eventually!
#DAX #BRENT As the worlds leading country for jail population, you’d think the USA would be good at prisons. Events this weekend tend suggest this isn’t the case and all their practice has counted for nothing. Losing the countries highest profile guest of their penal system must be a major oops. Is the DOW as safe?
We’ve a reason for questioning the DOW as when we last
reviewed it at Easter, a good argument existed suggesting the index should climb
above 28,000 points. Alas, the market managed the mid 27 thousands, then fell
back. It was interesting to note the index trashed this years immediate uptrend
before enacting some surprise recovery. Oddly, when this sort of thing happens
with European markets, we always fear the worst as any future break below a
trend is both expected and will doubtless be vile. But North America is
different as, when a price breaks below a trend, then recovers above, the market
will invariably climb to safety again.
Often, we feel this is the difference in national
psyche – across the pond hoping for the best but on this side, we expect the
If the USA continues “hoping for the best”, it appears
movements now exceeding 26,415 calculate with the ambition of an initial 26,637
points. If exceeded, it will be sane to hope for continued recovery toward
27,272. The visuals quite strongly suggest some hesitation if such a level makes
By taking the European standpoint, in the scenario of
the DOW falling below Red – presently around 26,000 points, reversal risks being
quite share down to 25,289 points initially. If broken, secondary is a longer
term 24,592 points.