Shared the chart below, reflecting a sharp decline in a key commodity index and a breakout of the U.S. Dollar (see post here)
The breakout at (2) below created a pretty painful situation for long commodity players… I remain of the opinion, of all the charts/noise I create, the long-term outcome of the chart below is about as important as it gets!
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Below is an update on the MS Commodity Index (CRX) and Crude oil, reflecting that counter trend rallies look to have taken place, bringing them up to key falling resistance/channel lines…
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At this time, resistance is resistance. A break above these lines would be a big relief to the world from a Macro point of view! The Commodity/Stock rally I suspect has felt good to investors, yet from a “Power of the Pattern” perspective, nothing on the upside has been proven at all, at this point in time!
We will find out a ton about the global economy per how these two do and if the Shanghai index can hold at support!
If the Shanghai index fails to hold support(see post), Crude and Commodities fall a TON!!!
Personally, I am short crude as of yesterday, so I really hope that it does NOT break out… not really funny losing 5% in 24 hours, as I have stops on a close above resistence. I was being auto-ironic, trying to hide the bitterness…
Luke…if you take the May high and the July high, Crude is not above that resistance line at this time, yet darn close! Great eyes!!!
C
Is it just me, or crude is breaking out? Should we rush to buy that one on this friday afternoon?
Hello Chris,
Great blog and analysis! You’re lucky to live in America where oil prices can not only grow but also fall. Unfortunatelly here in Europe Brent oil is still above 100$ – 30% more expensive than Crude:
http://stooq.pl/q/?s=sc.f&d=20111013&c=3y&t=l&a=lg&b=0&r=cl.f
Best Regards
Dominik
Hi Chris .. this is a WOW.. just like the Russell chart call. Too bad i didn’t trade so well on that .. but i’m learning..
best regards..this helps for where we are going..tks much..
Denis.