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Commodity Research Bureau Index (CRB) of late hit its 61% fibonacci retracement level at (1) and at the same time FCX was creating a bearish rising wedge at resistance point (3).
Major Trend Change at hand? Too early to tell, yet from a pattern perspective it was a great place to enter positions to score on defense in SMN & DUG! This situation could be just as important and have the same outcomes as the summer of 2008 for the CRB….
Joshua….SSEC index is within a couple of percent of the top of the flag. No breakout/breakdown has taken place at this time.
Eric….for most of history if the Dollar moves higher, metals fall. This is NOT always true though. Early in 2010, gold and the dollar both moved up 10%, at the same time. Right now the Dollar is on support and Silver remains in an uptrend. We own both of these due to price action, not past correlation moves.
Mike…Great point for sure! Will see if which is more powerful, patterns or earthquakes! I am not a bull or a bear, will position where prices indicate we should and will do my best to not make investment decisions based upon news events.
Chris…won’t Japan be needing lots of basic commodities to repair the damage now? Is it time to buy FCX again?
Thanks for your insight.
Hi Chris,
A question, what happens to gold and silver prices as the dollar starts to rally and goes above its 3 year support trendline?
Is this the beginning of the end or a pause?
Eric
S…Could DUG go up if Oil does? Yes! What if the stock market goes down? What might DUG do? Do keep these chart tid bits in mind. Oil is still dealing with its Fib 61% level. One of the largest upside wicks in years took place in the past two weeks and XLE (oil stock ETF) took in 46% of all ETF in flows in the month of Feb! Can you say crowded trade up against resistance and oh I forgot to mention, a massive rising wedge took place in Crude .
https://www.kimblechartingsolutions.com/2011/03/large-upside-wick-in-crude-oil-update/
For now I am “Digging DUG” as it was up around 7% on the day.
Hi Chris,
One question, doesn’t DUG assume that the price of oil and gas will decrease?
It sure seems like this is a short term play as oil and gas will most likely go much higher.
Am I seeing things incorrectly?
stemphos