Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
Dow Stock Market Trend Forecast Update - 21st Sep 19
Is Stock Market Price Revaluation Event About To Happen? - 21st Sep 19
Gold Leads, Will the Rest Follow? - 21st Sep 19
Are Cowboys Really Dreaming of... Electric Trucks? - 21st Sep 19
Gold among Negative-Yielding Bonds - 20th Sep 19
Panicky Fed Flooding Overnight Markets with Cash - 20th Sep 19
Uber Stock Price Will Crash on November 6 - 20th Sep 19
Semiconductor Stocks Sector Market & Economic Leader - 20th Sep 19
Learning Artificial Intelligence - What is a Neural Network? - 20th Sep 19
Precious Metals Setting Up Another Momentum Base/Bottom - 20th Sep 19
Small Marketing Budget? No Problem! - 20th Sep 19
The Many Forex Trading Opportunities the Fed Day Has Dealt Us - 19th Sep 19
Fed Cuts Interest Rates and Gold Drops. Again - 19th Sep 19
Silver Still Cheap Relative to Gold, Trend Forecast Update Video - 19th Sep 19
Baby Boomers Are the Worst Investors in the World - 19th Sep 19
Your $1,229 FREE Tticket to Elliott Market Analysis & Trading Set-ups - 19th Sep 19
Is The Stock Market Other Shoe About To Drop With Fed News? - 19th Sep 19
Bitcoin Price 2019 Trend Current State - 18th Sep 19
No More Realtors… These Start-ups Will Buy Your House in Less than 20 Days - 18th Sep 19
Gold Bugs And Manipulation Theorists Unite – Another “Manipulation” Indictment - 18th Sep 19
Central Bankers' Desperate Grab for Power - 18th Sep 19
Oil Shock! Will War Drums, Inflation Fears Ignite Gold and Silver Markets? - 18th Sep 19
Importance Of Internal Rate Of Return For A Business - 18th Sep 19
Gold Bull Market Ultimate Upside Target - 17th Sep 19
Gold Spikes on the Saudi Oil Attacks: Can It Last? - 17th Sep 19
Stock Market VIX To Begin A New Uptrend and What it Means - 17th Sep 19
Philippines, China and US: Joint Exploration Vs Rearmament and Nuclear Weapons - 17th Sep 19
What Are The Real Upside Targets For Crude Oil Price Post Drone Attack? - 17th Sep 19
Curse of Technology Weapons - 17th Sep 19
Media Hypes Recession Whilst Trump Proposes a Tax on Savings - 17th Sep 19
Understanding Ways To Stretch Your Investments Further - 17th Sep 19
Trading Natural Gas As The Season Changes - 16th Sep 19
Cameco Crash, Uranium Sector Won’t Catch a break - 16th Sep 19
These Indicators Point to an Early 2020 Economic Downturn - 16th Sep 19
Gold When Global Insanity Prevails - 16th Sep 19
Stock Market Looking Toppy - 16th Sep 19
Is the Stocks Bull Market Nearing an End? - 16th Sep 19
US Stock Market Indexes Continue to Rally Within A Defined Range - 16th Sep 19
What If Gold Is NOT In A New Bull Market? - 16th Sep 19
A History Lesson For Pundits Who Don’t Believe Stocks Are Overvalued - 16th Sep 19
The Disconnect Between Millennials and Real Estate - 16th Sep 19
Tech Giants Will Crash in the Next Stock Market Downturn - 15th Sep 19
Will Draghi’s Swan Song Revive the Eurozone? And Gold? - 15th Sep 19
The Race to Depreciate Fiat Currencies Is Accelerating - 15th Sep 19
Can Crypto casino beat Hybrid casino - 15th Sep 19
British Pound GBP vs Brexit Chaos Timeline - 14th Sep 19
Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - 14th Sep 19
War Gaming the US-China Trade War - 14th Sep 19
Buying a Budgie, Parakeet for the First Time from a Pet Shop - Jollyes UK - 14th Sep 19
Crude Oil Price Setting Up For A Downside Price Rotation - 13th Sep 19
A “Looming” Recession Is a Gold Golden Opportunity - 13th Sep 19
Is 2019 Similar to 2007? What Does It Mean For Gold? - 13th Sep 19
How Did the Philippines Establish Itself as a World Leader in Call Centre Outsourcing? - 13th Sep 19
UK General Election Forecast 2019 - Betting Market Odds - 13th Sep 19
Energy Sector Reaches Key Low Point – Start Looking For The Next Move - 13th Sep 19
Weakening Shale Productivity "VERY Bullish" For Oil Prices - 13th Sep 19
Stock Market Dow to 38,000 by 2022 - 13th Sep 19 - readtheticker
Gold under NIRP? | Negative Interest Rates vs Bullion - 12th Sep 19
Land Rover Discovery Sport Brake Pads and Discs's Replace, Dealer Check and Cost - 12th Sep 19
Stock Market Crash Black Swan Event Set Up Sept 12th? - 12th Sep 19
Increased Pension Liabilities During the Coming Stock Market Crash - 12th Sep 19
Gold at Support: the Upcoming Move - 12th Sep 19
Precious Metals, US Dollar, Stocks – How It All Relates – Part II - 12th Sep 19

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

U.S. Dollar, Crude Oil and Gold Teetering Bull Markets

Commodities / Financial Markets 2009 Mar 01, 2009 - 03:23 PM GMT

By: Chris_Vermeulen

Commodities Diamond Rated - Best Financial Markets Analysis ArticleThe past 6 months have been every interesting, as the financial markets try to find a bottom while banks go bankrupt and more and more investment scandals continue to pop up on the radar destroying investor's life savings literally over night. It still sounds crazy, when I hear banks are going bankrupt and it just goes to show anything can happen.


The feds continue to poor billions of USD's into the system, when everyone is 100% sure the USD is about to become worthless. The USD has been consistently stronger, even though the feds continue to dilute the world with more $$$$ on a monthly basis. Gold has also been increasing in value, reaching $1000 a week ago, as foreign currencies decline, sending the rest of the world buying gold as a safe haven.

The charts below, of the USD currency and the UUP Dollar ETF, show something, which I think will be interesting to watch. Exchange traded funds are known for not following the underlying vehicle perfectly, which is something that, us as traders, just have to live and learn to deal with. But the funds can provide us with some interesting opportunities from time to time. The two charts below show the strength of the US Dollar and currently testing the highs formed back in November and forming a bullish wedge indicating a breakout to the upside is likely to happen. If we do get a breakout, my target for the USD is around the 95 area.

Now take a look at the chart of the UUP fund, which allows traders to trade the USD. What do you see? The fund is underperforming, which can be seen by looking at the price, which is 2% below the November high resistance line. What I am looking to see here is, for the USD to breakout above the November high, which will trigger the UUP fund to surge higher, as it must also breakout to new highs, generating a quick pop in price adding 1-2% extra potential out of this possible setup.

USD Currency Price – Daily Trading Chart
US Dollar Trading Chart

UUP Dollar Fund – Daily Trading Chart
UPP Trading Fund

Spot Gold & Gold ETF Trading Charts
Gold has been a little trickier to trade recently, simply because gold's correlation to the USD has been off. Both gold and the USD are moving together in sync, but at any time, they could snap back to their normal inverse trading relationship. If this happens and the USD continues to move higher, gold will decline in value and really frustrate the majority of investors, who just dumped their investments into gold. The market always moves in the direction, which will hurt the majority of investors (general public investors) and this is why I want to mention it. Everyone in my opinion and from all the people I talk with, are long gold, and everyone thinks the US dollar is going to crash. Seems right for gold to continue down or move sideways like it did for all of 2006 and 2007, to shake investors out, as they start putting their money to work where things are showing returns, only for the price of gold to make a huge run higher after the majority of the general public gets out.

That being said, I don't care which way it goes, as I just follow the price action and trade long or short, when there is a tradable setup with risk under 3% using my trading model. It is a little more difficult to trade now, as volatility is much higher with risk of generally over 3% during setups, but when volatility is high, I prefer to hold mostly cash and wait for some of the dust to settle, only taking setups when risk is within my trading model requirements.

GLD Gold ETF Trading Chart
Gold corrected last week, as expected from looking at the trading chart. Gold has been trading at the top of its trend channel with gold stocks starting to underperform the price of gold and stochastic indicator topping out and hooking down. Gold is currently trading at the mid support level and could find some additional support. We would like to see the price continue lower to the bottom of the channel, where we could possibly end up having a buy signal. I expect GLD to continue to pull back to the $87.5 - $90 level before providing a reversal candle, at which point, we could buy gold for a long trade.
GLD Gold Fund Trading Chart

Spot Gold End of Day Trading Chart
Spot gold chart shows the same, but I thought I would show it, so we can see the actual gold prices, when there is a buy or sell signal for physical gold bullion and coin traders.
Spot Gold Trading Signals

Strike It Rich with Crude Oil
Crude oil made some positive progress last week, as the price climbed up and over $44 per barrel. This move higher has provided several technical trading signals, which will help get investors into this slippery investment. Oil posted a nice gain last week and in doing so, provided us with oil closing over the 40 moving average and posting a new multi week high. The MACD broke out, which has been consolidating for several weeks, which is bullish and the stochastic indicator broke out and made a new multi month high.
These are great to see and once we have a clean trend line break and setup, I think we will see some exciting prices for crude oil.

Crude Oil Trading Signals

Trading Conclusion:
The US dollar I think will be interesting to watch and take part in if we get a setup. The double leveraged dollar fund (UUP) provides some excellent trades and setups. Considering everyone is bearish on the dollar it makes me like this trade even more.

Gold is currently several days away from any buy or sell signal, so we will continue to watch it unfold over the next week or so.

Crude Oil is really starting to look interesting and could provide us with a nice trade soon. One more positive day on oil and it will generate a full buy signal. I will be waiting for a pullback and reversal when an up trend line will not be as steep. Current down side risk is over 16% from support, which is much too high for me. I just finished reading a book written by JT Grenough, about what you can do to protect yourself in this new world order economic environment. It's about crisis investing for 2009 covering gold, oil and real estate. Definitely worth reading!

Hello, I'm Chris Vermeulen founder of TheGoldAndOilGuy and NOW is YOUR Opportunity to start trading GOLD, SILVER & OIL for BIG PROFITS.  Let me help you get started.

I have put together a Recession Special package for yearly subscribers which is if you join for a year ($299) I will send you $150 FREE in gas, merchandise or grocery vouchers FREE which work with all gas stations, all grocery stores and over 100 different retail outlets in USA & Canada.

If you interested please act fast as I only have 67 of these vouchers before they are gone for good.

If you would like to receive my free weekly market updates please visit my website: www.TheGoldAndOilGuy.com

I look forward to hearing from you soon!

By Chris Vermeulen
Chris@TheGoldAndOilGuy.com

Please visit my website for more information. http://www.TheGoldAndOilGuy.com

Chris Vermeulen is Founder of the popular trading site TheGoldAndOilGuy.com.  There he shares his highly successful, low-risk trading method.  For 6 years Chris has been a leader in teaching others to skillfully trade in gold, oil, and silver in both bull and bear markets.  Subscribers to his service depend on Chris' uniquely consistent investment opportunities that carry exceptionally low risk and high return.

This article is intended solely for information purposes. The opinions are those of the author only. Please conduct further research and consult your financial advisor before making any investment/trading decision. No responsibility can be accepted for losses that may result as a consequence of trading on the basis of this analysis.  

Chris Vermeulen Archive

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


Comments

robert
02 Mar 09, 12:09
RE: U.S. Dollar, Crude Oil and Gold Teetering Bull Markets

Oil and Gold both look ready to tank. Especially oil. Going into the low 30's for sure.


Post Comment

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

6 Critical Money Making Rules