Trading on "Eggshells"

Hello traders everywhere. Adam Hewison here, co-founder of MarketClub, with your 1 p.m. market update for Friday the 24th of June.

It has been quite a week with the Greek problem still not out of the woods. Ben Bernanke indicated that the economy is not so good after all. Plus the release of 30 million barrels of oil just enough for the US to get through a day or two. How crazy is all of that.

Okay, here it is the end of the week and the markets are mixed at 1pm. The Dow is down for the week right now, the NASDAQ is on the plus side, and the S&P500 is stuck in the middle of the road and has barely changed this week.

Now let's take a look at what's happening in the markets today...

S&P 500: -70. The market action continues to reflect a trading range. Major downside support is at $1,250. Upside resistance begins at $1,300.

Silver: -70. This market is heading for a test of the lower levels of the Donchian trading channel.

Gold: +55. An exit signal at $1,532.73 was given yesterday, as was a sell signal at $1513.18 for short term and intermediate traders only. Major support at $1,480. Major resistance at $1,550.

Crude Oil: -100. This market is at the lower levels of support. We wanted to buy for a trading turn around the $90.07 level which represents a 61.8% Fibonacci retracement. The trend is down based on our Trade Triangle technology.

The Dollar Index: -70. Pretty much the same as yesterday. Our indicators are still negative longer-term for this index. Minor support at $74.50. Resistance at $76.00. Look for a possible test of the upper line of the Donchian channel.

The Thomson Reuters/Jefferies CRB Commodity Index: -100. We are at the lower range of the Donchian channel and the market is oversold. We would not rule out some sort of bounce from current levels. Market is in a downtrend and moved out of the Donchian Channel due to the surprise crude oil announcement out of the White House yesterday.

Every success,
Adam Hewison
President of INO.com
Co-founder of MarketClub

8 thoughts on “Trading on "Eggshells"

  1. I think the dollar looks pretty good here.

    There will be no QE3 and by now the only meaningful economic stimulus for the United States is to pump up the dollar and thus beat down cost of economic input from energy, foodstuffs and raw materials. This is the only way of preserving the fully priced bond bubble, the most important bubble of them all. If it bursts and interest rates explode, the whole system collapses like a house of cards.

    The dollar has been trading in a range of ca. 75-95 for the last years. I think it should be good for 80-85 by year´s end or even earlier. I´m very bearish its main counter trades, stocks and commodities.

  2. GLD was forming a beautiful symmetrical triangle ( daily) from May, it really broke hard out of a tight coil to the downside. I am making out that 144 and then 141 is a possibility if it does not get back inside the Donchian Ch. soon.

    ADAM, what do you personally have the Donchian set to on GLD or GDXJ ( IE, mining stocks as opposed to Physical Etf, or are the both the same settings on Donchian)?

    Is there anywhere on the site to read more about your lower chart indicators and their appropriate use. I was looking at CCI for GLD, and it seems to work ok....

  3. Two quotes by Dr. Marc Faber come to mind vis a vis government intervention ..."Be your own Central Banker and buy as much gold as you can, a little each month" ( Gloom Boom and Doom Report)
    and:
    "Bernanke is a murderer of the Middle Class"( Bloomberg Video)

  4. For whatever this is worth to the GOLD long-term traders and/or holders: When I look at the INO 6 month candlestick chart, I see that a cup-and-handle, with correction,formation has just been completed, between 1500 and 1550. Following past history, after breakout, this formation has subsequently given rise to the next +100 gold price level. If that holds true again, and I expect that it will, the price of gold should next be rising to the 1600 - 1650 level. Time will tell and we shall see.

  5. If gold should test $1480, I will consider getting a second mortgage on my house to buy as much gold as I can!!!

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