Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
If You Get These 3 Things Right, You’ll Never Have to Worry About Money - 22nd Mar 19
March 2019 Cryptocurrency Technical Analysis - 22nd Mar 19
Turkey Tourist Fakes Market Bargains Haggling Top Tips - 22nd Mar 19
Next Recession: Finding A 48% Yield Amid The Ruins - 22nd Mar 19
Your Future Stock Returns Might Unpleasantly Surprise You - 22nd Mar 19
Fed Acknowledges “Recession Risks”. Run for the Hills! - 22nd Mar 19
Will Bridging Loans Grow in Demand and Usage in 2019? - 22nd Mar 19
Does Fed Know Something Gold Investors Do Not Know? - 21st Mar 19
Gold …Some Confirmations to Watch For - 21st Mar 19
UKIP No Longer About BrExit, Becomes BNP 2.0, Muslim Hate Party - 21st Mar 19
A Message to the Gold Bulls: Relying on the CoT Gives You A False Sense of Security - 20th Mar 19
The Secret to Funding a Green New Deal - 20th Mar 19
Vietnam, Part I: Colonialism and National Liberation - 20th Mar 19
Will the Fed Cut its Interest Rate Forecast, Pushing Gold Higher? - 20th Mar 19
Dow Jones Stock Market Topping Pattern - 20th Mar 19
Gold Stocks Outperform Gold but Not Stocks - 20th Mar 19
Here’s What You’re Not Hearing About the US - China Trade War - 20th Mar 19
US Overdosing on Debt - 19th Mar 19
Looking at the Economic Winter Season Ahead - 19th Mar 19
Will the Stock Market Crash Like 1937? - 19th Mar 19
Stock Market VIX Volaility Analysis - 19th Mar 19
FREE Access to Stock and Finanacial Markets Trading Analysis Worth $1229! - 19th Mar 19
US Stock Markets Price Anomaly Setup Continues - 19th Mar 19
Gold Price Confirmation of the Warning - 18th Mar 19
Split Stock Market Warning - 18th Mar 19
Stock Market Trend Analysis 2019 - Video - 18th Mar 19
Best Precious Metals Investment and Trades for 2019 - 18th Mar 19
Hurdles for Gold Stocks - 18th Mar 19
Pento: Coming QE & Low Rates Will Be ‘Rocket Fuel for Gold’ - 18th Mar 19
"This is for Tommy Robinson" Shouts Knife Wielding White Supremacist Terrorist in London - 18th Mar 19
This Is How You Create the Biggest Credit Bubble in History - 17th Mar 19
Crude Oil Bulls - For Whom the Bell Tolls - 17th Mar 19
Gold Mining Stocks Fundamentals - 17th Mar 19
Why Buy a Land Rover - Range Rover vs Huge Tree Branch Falling on its Roof - 17th Mar 19
UKIP Urged to Change Name to BNP 2.0 So BrExit Party Can Fight a 2nd EU Referendum - 17th Mar 19
Tommy Robinson Looks Set to Become New UKIP Leader - 16th Mar 19
Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - 16th Mar 19
Towards the End of a Stocks Bull Market, Short term Timing Becomes Difficult - 16th Mar 19
UKIP Brexit Facebook Groups Reveling in the New Zealand Terror Attacks Blaming Muslim Victims - 16th Mar 19
Gold – US Dollar vs US Dollar Index - 16th Mar 19
Islamophobic Hate Preachers Tommy Robinson and Katie Hopkins have Killed UKIP and Brexit - 16th Mar 19
Countdown to The Precious Metals Gold and Silver Breakout Rally - 15th Mar 19
Shale Oil Splutters: Brent on Track for $70 Target $100 in 2020 - 15th Mar 19
Setting up a Business Just Got Easier - 15th Mar 19
Stock Market Elliott Wave Analysis Trend Forercast - Video - 15th Mar 19
Gold Warning - Here Are the Stunning Implications of Plunging Gold Price - Part 1 - 15th Mar 19
UK Weather SHOCK - Trees Dropping Branches onto Cars in Stormy Winds - Sheffield - 15th Mar 19
Best Time to Trade Forex - 15th Mar 19
Why the Green New Deal Will Send Uranium Price Through the Roof - 14th Mar 19
S&P 500's New Medium-Term High, but Will Stock Market Uptrend Continue? - 14th Mar 19
US Conservatism - 14th Mar 19
Gold in the Age of High-speed Electronic Trading - 14th Mar 19
Britain's Demographic Time Bomb Has Gone Off! - 14th Mar 19
Why Walmart Will Crush Amazon - 14th Mar 19
2019 Economic Predictions - 14th Mar 19
Tax Avoidance Bills Sent to Thousands of Workers - 14th Mar 19

Market Oracle FREE Newsletter

Stock Market Trend Forecast March to September 2019

Some Commodity Charts are Breaking Out

Commodities / Commodities Trading Dec 21, 2017 - 02:53 PM GMT

By: Rambus_Chartology

Commodities

Today I would like to update some charts for the commodities complex as we are starting to see some action in this sector. Back in the summer months when we first started to get long some of the different commodities sectors, we got many breakouts from some very nice H&S bases. After the initial move up came the first consolidation phase that has been going on for nearly four months or so. We are now starting to see some of these consolidation patterns breaking out which should lead to the next impulse move higher in most cases.

Lets start with BHP, one of the biggest miners on the planet, that shows a good example of where we are at in the bull market. Today the price action broke out with a gap above the top rail of an almost 5 month triangle consolidation pattern. A backtest to the top rail would come in around the 43.50 area.


Now lets look at a long term weekly chart which shows some classic Chartology. We have discussed many times in the past when you see a small consolidation pattern form just below an important trendline, in this case the neckline, and one above, that is usually a very bullish setup which BHP is now showing.

Also keep in mind the size of that double H&S bottom that took three years to buildout. Big patterns lead to big moves. The minimum price objective of that double H&S bottom is measured from the head straight up to the neckline # two. Add that distance to the breakout point to get your minimum price objective.

This monthly chart put the double H&S bottom in perspective.

Copper is an important commodity as it can show the strength or weakness of the economy which is why it’s called Dr. Copper. This weekly chart shows copper’s big H&S bottom with the breakout in the summer. The head formed a 7 point triangle reversal pattern which actually reversed the bear market. Here is a case where we didn’t see a backtest to the neckline when the breakout took place. The 30 week ema has done a good job of holding support so far during Coppers new bull market.

This 20 year monthly chart shows how the H&S fits into the very big picture.

Below is the quarterly chart which shows some nice Chartology especially that 24 year flat top triangle’s price objective.

I originally took two positions, one in July and one in August of this year for the COPX, Copper Miners etf, in anticipation of the eventual breakout above the neckline which so far hasn’t happened just yet. It’s close but no cigar.

This monthly chart shows a double H&S bottom which many of the different commodities are showing. The 12 month simple moving average has done a good job of showing support during the new bull market.

SCCO, Southern Copper, is the strongest stock in this sector. The daily chart below shows it has just broken out from a rectangle consolidation pattern with a breakout gap.

If big patterns lead to big moves then this weekly chart for SCCO says we should expect a very large impulse move higher as it’s trading at a new all time high after breaking out from a six year triangle consolidation pattern.

This 25 YEAR monthly chart below shows the breakout taking place above the six year triangle consolidation pattern which is now making new all time highs. Note the blue bullish rising wedge that formed as a halfway pattern back in the early 2000’s.

Some of the steel stocks are starting to show their pent-up bullishness as they are breaking out from major consolidation patterns. This monthly chart for NUE shows it broke out from its 9 year triangle consolidation pattern in 2016 and has been consolidating that breakout move by forming a second consolidation pattern just above the top rail which is the Red Bull flag.

This week SCHN is breaking out from a six year double H&S bottom. You would have to go all the way back to 2011 to equal today’s high.

This weekly chart for STLD shows it broke out from a one year bull flag three weeks ago.

This 20 year monthly chart shows the entire history for STLD. This chart also has some nice Chartology on it. Note the 2000 H&S bottom which launched STLD on its first bull market which produced several consolidation patterns along the way. When that bull market ended in 2008 it took 9 years to build out the massive triangle consolidation pattern which is now launching STLD on its next bull market leg higher. If you stand back and look at this chart from a distance you can almost see the beginnings of a parabolic move taking place.

Before I run out of time I would like to show you one of the weakest areas in the commodities complex which is $NATGAS. Last week it finally broke down from a year and a half H&S top. We now have a clean line in the sand, above the neckline is bullish and below is bearish.

Several weeks ago I tried to go long UNG as it was testing the bottom rail of an expanding triangle. After five touches of the bottom rail I thought it would hold one last time, but that wasn’t the case. After getting a decent pop off the last touch the price action reversed straight down and then gapped the bottom trendline where I exited the trade. Again UNG is bullish above the bottom rail and bearish below.

There are two patterns I’m keeping a close eye on for $WTIC. This first pattern is a rising flag formation which has just completed its fourth reversal point at the top rail. I would view the rising flag as a halfway pattern if the price action can take out the top rail.

As we’ve seen with some of the other commodity related stocks tonight many have formed a double H&S bottom reversal pattern. This 10 year daily chart for $WTIC shows it too has a double H&S pattern in play with a breakout above the neckline. The last time we looked at this chart I suggested it looked similarly inverse to that massive unbalanced H&S top, only on a smaller time frame.

This 20 year monthly chart shows how the double H&S bottom fits into the big picture.

This last chart for tonight is a 35 year quarterly chart which puts everything in perspective. Keep in mind the measured move for a H&S pattern when you look at this chart. Time to get this posted

All the best

Gary (for Rambus Chartology)

http://rambus1.com

FREE TRIAL - http://rambus1.com/?page_id=10

© 2017 Copyright Rambus- All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Rambus Chartology Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules