Saturday, May 14, 2011

Markets and Commodities Rest Week - Market Analysis for 17th May 2011 by Singaporeseeds

Daily chart for Dow

Daily chart for S&P

Daily chart for NASDAQ

That was interesting….the indexes closed on the weekly chart as a doji. We were bouncing off support at around 1340 on S&P on Wednesday to Friday. Looks like the indexes are poised for the next leg up soon. However all these had been happening with a bearish divergence on MACD.
The support levels at 1340 on S&P and the 50 moving average currently at around 1325 will be crucial. If these 2 supports fails to hold, we might be going for a bit of a drop with the next support coming in at 1270 and then 1215.
If we bounce off to make a new high, we will be looking at 1554 by the end of the year.

Daily chart for Dollar

The dollar (UUP) bounced back to its 50 day moving average and closed above it on Friday. We are looking at the next resistance level at 22. I believe we will retrace back to 22 and maybe slightly beyond that before reversing back down to 19.75. We are currently in a dead cat bounce.
This movement should be inversely mirrored by the current downward movement in almost all commodity prices. And when the dollar starts to turn back down, commodity prices are expected to enter its last crazy bullish phase and shoot through the roof.

Daily chart for Gold

Daily chart for Silver

Gold (GLD) and silver (SLV) are going through a few weeks of weakness as the dollar bounces back up. The first support for gold will be at 140 then its 50 day moving average at around 142.50. For silver, this will be at 32, 30 then 28. I believe this is a dip in an uptrend and we have to get ready for a last crazy rally soon.

Daily chart for Crude Oil

Crude oil (USO) bounced off support at around 38.50 again on Thursday and Friday. We are now ready for a bounce up to resistance at 41.4 and 42. As Thursday closed as a doji, Friday as a hammer…a bullish candle on Monday will signal the start of the dead cat bounce.

Daily chart Natural Gas

Natural Gas (UNG) had been bouncing off rock bottom support at around 10.50 since end of October. Despite all the bullish divergences and signals, any rally had failed to push it beyond its 200 day moving average. This is one of the most bullish signals for any stock or ETFs. Now with the 200 day moving average closing in on the 50 day moving average, the chances of this happening is increasing. We shall see whether we’ll finally cross the 200 this week.

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