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Trading Lessons

US Dollar Cycle Rotation To Boost Oil & Other Commodities

Commodities / Commodities Trading May 04, 2018 - 01:14 PM GMT

By: Chris_Vermeulen

Commodities

Our recent analysis of the US Dollar has presented a very unique and interesting setup for traders – an opportunity for a general commodity rally with Oil leading the way.

Taking a look at this Daily chart of the UUP (US Dollar Index Bullish Fund) with our Advanced Dynamic Learning Cycles price modeling system applied to it, we can see that the cycle analysis is predicting a rotational top in the US Dollar over the next 2~5+ trading days before a new bearish price trend pushes this US Dollar fund back to below the $24 level.  We have highlighted the Resistance Zone in red and we believe this rotating top will play out fairly quickly as an excellent opportunity for traders.


This general weakness setting up in the US Dollar should translate to strength in a number of commodities; Gold, Silver, Platinum, Oil and many others will likely see a 4~12% price increase if the US dollar contracts throughout this downward cycle rotation.

-See Our Exclusive Platinum Price Forecast – Click Here-

Oil is particularly interesting to us because we believe the rotational top in the US Dollar will result in support solidifying in Oil near or above $66 and launch Oil into a new upside rally to well above $70.  It makes sense to us that weakness in the US Dollar with the corresponding upside pressure exerted on commodities will present an easy upside move in Oil for traders who see this move coming and are willing to take the trade.

Any Oil price move below $67 is well within our GREEN highlighted support zone and should be considered a BUY ZONE for this trade.  Remember, as this rotational top in the US Dollar plays out, there could be some volatility in both the US Dollar and Oil, so spread out your trades over a couple days to reduce risk.

The upside potential for this trade is, in our opinion, 4~7% or more.  Our modeling systems expect a 5.25% upside swing from this move currently and we believe the upside may be a little bit more than this expectation.  We believe this is a solid trade setup and weakness in the US Dollar will be key to this trade playing out as we expect.  Remember, all of this is expected to happen within the next 10 to 20 trading days, so you have time to position your trades and take advantage of this move.

You can receive my daily pre-market analysis, index, oil, and precious metals trades by joining my Wealth Building Newsletter.

Chris Vermeulen
www.TheTechnicalTraders.com

Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several leading financial hubs like MarketOracle.co.uk

Disclaimer: Nothing in this report should be construed as a solicitation to buy or sell any securities mentioned. Technical Traders Ltd., its owners and the author of this report are not registered broker-dealers or financial advisors. Before investing in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make an investment based solely on what you read in an online or printed report, including this report, especially if the investment involves a small, thinly-traded company that isn’t well known. Technical Traders Ltd. and the author of this report has been paid by Cardiff Energy Corp. In addition, the author owns shares of Cardiff Energy Corp. and would also benefit from volume and price appreciation of its stock. The information provided here within should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. Technical Traders Ltd. and the author of this report do not guarantee the accuracy, completeness, or usefulness of any content of this report, nor its fitness for any particular purpose. Lastly, the author does not guarantee that any of the companies mentioned in the reports will perform as expected, and any comparisons made to other companies may not be valid or come into effect.

Chris Vermeulen Archive

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