Monday, June 27, 2011

Poised for the next rally! - Market Analysis for 27th June 2011 by Singaporeseeds

Daily chart for Dow

Daily chart for S&P

Daily chart for NASDAQ

We are now in the longest down market since the 2008 subprime crisis. The market had been going nowhere and looks to be so for the next few weeks.

On the charts, all three indexes are now just above their 200 day moving averages and had spent the last 2 weeks bouncing on it. This level are also near some kind of support for all three indexes.

I believe we are close to the beginning of the next leg of market rally. We might consolidate for a few more days but i’m now waiting for a signal to long the market. Next target at 1,430 for the S&P.

Daily chart for Dollar

The dollar UUP had formed a wedge since early May 2011. Volatility had been decreasing and whichever side it breaks out from will determine its direction for the next few months. I still believe it will break down to complete it’s fibo retracement at 19.70.

Daily chart for Gold

Since my analysis for the dollar is down, this should also mean that I believe the medium term trend for most commodities especially the metals will be up. However Gold had been forming a bearish divergence on both RSI and MACD with a triple top at 151.50. This is very bearish but gold had formed numerous failed bearish divergences that kept breaking to new highs over the past few years. I’m going to sit out and just observe this one.

Daily chart for Silver

Silver seems to have formed the classic parabolic movement. A huge spike up followed by a rapid drop and then a bounce that fails to break above 50% of the last spike. Silver also broke down out of it’s up channel last week. I believe it is going to move to its next support level at 30 over the next few days.

Daily chart for Crude Oil

Crude Oil is at support at 35.46. I believe the recent downtrend had ended. We should see some kind of bounce soon.

Daily chart for Natural Gas

Natural Gas had been going sideways for the longest of times. I’ve always said that this is going to be a long term play since the first day I wrote about it. On weekly charts, it is showing the strongest of bullish signals. I believe the movement for Natural gas from now on will be up and slow.

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