Now that we’ve encouraging information, we need to have the ability to make informed decisions regarding on how best to proceed. Unfortunately, politicians are creating this much worse than it must be. The harm they’ve done to the market is immeasurable.
It’s reported that 55% of restaurants around Yelp have closed their doors once and for all. And some quote which 33% of those resorts in the U.S. can go out of business. In my view, the market is yet to sense the long-term effects of the financial shutdown.
Gold attained new all-time highs over the back of a declining dollar. I anticipated a breakout over $2000, but maybe not before 2021 or 2022. What happens next is dependent on the buck. If the dollar stabilizes and ends greater, then gold must fix and start to combine. If the dollar continues to crash, then gold can enter a runaway transfer higher.
The Fed declared no change in its interest rate policy on Wednesday and said it would do everything required to encourage the economy. Occasionally gold and the dollar inverse tendencies (bottom or top ) only after a Fed choice. The buck made a bullish engulfing candle on Friday, encouraging the prospect of a change.
The gold cycle index stays pegged at 450, and gold is very overbought.
Gold is higher as a direct result of the crashing dollar. The dollar is incredibly oversold and due for a bottom, which would imply a top in gold. I’ve mentioned before how prices often reverse on or just after a crucial Fed meeting. The dollar formed a bullish engulfing candle on Friday, 2-days after Wednesday’s announcement. Closing above the 10-day EMA (currently 94.11) next week would sponsor a bottom.
It’s rare for prices to slice through a significant resistance level without consolidating first. And for that reason, I’m suspicious of the recent breakout to new all-time highs. When momentum is strong, like now, prices will sometimes overshoot a major level. If this is a momentum overshoot, then gold should stay below $2050 and finally turn lower. A sustained advance above $2100 would signal a potential runaway move.
Gold reached an intraday high of $2005.40 on Friday. Prices are very overboughtthis cycle indicator is maxed out at 450. The trend is well-overdue for a correction. A daily finish below $1971.40 would secure a swing high and signal a potential top.
After breaking out above $20.00, silver exploded to our $26.00 target. Prices are overbought and due for a pullback. Closing below $22.50 would support a top. To extend this advance, prices would have to close above the $26.27 spike high.
Platinum is the last precious metal to breakout to fresh highs. Prices would have to close above $1050 to signal a breakout. Whereas dropping below the cycle trendline would indicate a correction.
On Thursday, miners closed below Monday’s gap, issuing a potential exhaustion gap sell signal. Miners would have to close above $44.46 to reverse the short-term bearish signal. To confirm a multi-week correction – GDX would have to close below $36.87.
Juniors also closed below Monday’s gap, triggering a short-term sell signal – prices would have to close above $63.31 to reverse it. Otherwise, breaking below $50.00 would confirm the onset of a multi-week cycle correction.
Stocks consolidated throughout the week but managed to close above the short-term trendline on Friday. It looks like prices will attack the February 329 gap next week. Like gold, the trend is remarkably overbought and ready to your correction.
Have a safe and pleasant weekend.
AG Thorson really is a registered CMT and expert in technical analysis. He believes we are in your last phases of a worldwide debt super-cycle. To learn more, please see here.
This article was originally published on FX Empire
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