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If you happen to believe that Commodities should be listened too, per sending a macro message, investors might want to listen to the message of the CRB Index and the CRX Index at this point in time! Both of these broad based commodity index’s created bearish patterns of late and are reflecting macro weakness.
When the CRX index broke rising support back in 2008, broad based selling took place in the commodity complex and in the stock market. What might have been the key influence per the selling back in 2008? I suspect it was the Dollar breaking falling resistance. Well the Dollar is breaking falling resistance AGAIN, which started last week (see Dollar seeing Double Post here)
When the Dollar broke above resistance back in 2008, the “Great Escape” (see Great Escape post here) started to take place. Please respect the potential message from the CRB/CRX. Could another Great Escape take place? It already is in many ways! Check out how much lower many products now, than when the Great Escape post was created back in May!
If the CRB/CRX keep pushing lower, more of the Great Escape theme will take place! The message we should hear from them is? Protect your assets!
Investors beware….GE2 (Great Escape II) could pick up a ton of speed due to these patterns!!!
Keep an eye on the CRB index (see quote here)
Agree fully their is a ton of ways to look at charts. I am just one little guy that has liked reading the “Power of the Pattern” for the past 30 years. My biggest concern about the commodities charts, are the big weekly patterns, versus a small bull flag.
I shared an overaly of the CRX and the Dollar this morning with Premium members, reflecting a repeating pattern that should be of concern to long stock/commodity owners, which has us shorting the markets and looking for a sizeable decline in IYM and SMN might be a decent ETF to own.
Thanks for sharing Solson, their is always two sides to a coin.
All the best,
no – i’m not a masochist. just pointing out differing chart interpretations. holding lots of cash expecting the great escape. too timid to short until the ‘authorities’ announce some doomed-to-failure plan, then maybe short on a rebound if it happens… otherwise wait for lower prices. seems like we’re starting the ‘can the authorities annouce some plan over the weekend’ type of market – kinda like deja vu all over again.
Chris – VIX broke out of its daily close consolidation pattern today and the SPX has (both caveated by the fact that the day isn’t over) broken down on its own daily close pattern…seems to be a big wave down coming via these charts…
Solson…Thanks..so does this mean you are long and strong the CRB/CCI index at this time, ready for the rocket ship higher?
interesting chart – looks convincing – especially in light of stronger dollar. Here’s the opposite take on this: