CLICK ON CHART TO ENLARGE
The CRB Commodity Index lost over half its value in the 2008-2009 decline and then proceed to rally up to its 61% retracement level in May of 2011. The 61% Fib level stopped the CRB on a dime! Despite Benna-Clause attempting to inflate the world, the CRB has declined over 20% in the past 14 months!
I shared the above chart with Premium Members a couple of days ago, reflecting that the CRB hit its 23% Fibonacci and falling channel support line at (2) about 5 weeks ago and has now rallied up to its 38% Fibonacci level and falling channel resistance at (3).
Does this pattern reflect a “counter-trend rally peak” in the Commodities complex, at falling channel and 38% Fib resistance? It very well could. A further decline in the CRB from here, would suggest the Global deflation theme remains in tack!
If you would like information on the benefits of being a Premium Member, send us an email to firstname.lastname@example.org and we will email you full details on the benefits, unique charts and trading ideas Premium Members receive daily.
Then again, couldn’t this be seen as a bull flag (a little too steep maybe), i.e. even though the prices should fall again in the channell, they should eventually break to the upside?