Is The Dollar Going To Steal The Santa Claus Rally?

Top metals failed to keep on the bullish track set earlier. A heavy-duty dollar reinforced by historically high inflation, earlier tapering expectations, and a turn to safety puts pressure on precious metals.

Let us see what is currently happening with the Dollar Index in the daily chart below.

Dollar

The well-known "Double Bottom" (blue) pattern has emerged in the summer. It is a textbook case as all stages went precisely as they should appear.

The focus was on the breakup of the so-called "Neckline" (black horizontal line) located at the top between the two bottoms at $93.44. The first attempt to crack that level occurred at the end of August, but it failed. After a small retracement, the second attempt at the end of September succeeded in breaking out. The impulse was so strong that the price overshot the Neckline with a big margin to hit the fresh one-year top of $94.5. Continue reading "Is The Dollar Going To Steal The Santa Claus Rally?"

Santa Claus Rally Kicks Off For Gold

The year is approaching a sunset. It is the right time for precious metals to get ready for a Santa Claus visit to take them for a ride to the sky. One of the metals has already been in the game; I am talking about gold.

Daily Gold Chart

In October, I enriched the bullish view with the newly spotted “Diamond” reversal pattern. Most of you confirmed that you see this pattern. It is still good, as the invalidation level was not touched. Continue reading "Santa Claus Rally Kicks Off For Gold"

Silver Update: 1980s Vs. The 2010s

Silver surprised us with a strong Santa Claus Rally. It woke up like an ancient volcano and with a booming eruption. Before that, we proclaimed silver to be dormant compared to a vigorous rival, gold.

Everything changed at the end of 2018 as gold gained 10% from the lows and a weak silver tried to catch up to make the same profit at the very end. Bargain hunters couldn’t pass by this clear market distortion and took their chance to book a nice profit of around 4%.

In my earlier post I updated the medium term gold chart for you. Last time I updated the big chart of silver in October, which was titled dramatically “Fly Or Die” as submissive behavior of silver was leaving less and less hope for investors.

This time I am going to update the silver chart, but using a different approach. You are already familiar with it as I used historical clones with gold and silver before. The latter one was successful. This time it will be extended as I will use two clones instead of one from different historical periods so you can choose.

Let’s start with the distant one.

Chart 1. Silver Futures Monthly: Echo Of the 80s

Silver Update
Chart courtesy of tradingview.com

This chart was built in a high resolution, and I recommend you to click on it to open in a new window to see a larger image in details, especially in the right clone (orange box). Continue reading "Silver Update: 1980s Vs. The 2010s"

Gold & Silver: US Dollar Could Spoil Santa Claus Rally

Here we are on the final track of the year, and investors hope for the traditional Santa Claus rally in the precious metals sector. This euphoria of the anticipated strength based on the current move up could be spoiled if this pattern would emerge in the US dollar index (DXY).

Chart 1. US Dollar Index Daily: Triangle

US Dollar
Chart courtesy of tradingview.com

The disappointing data of US non-farm payrolls released last Friday couldn’t damage the US dollar as it kept above the former trough established on the 4th of December at 96.30. The first reaction in the market was a USD sell-off against all major currencies, but it was short-lived, and none of the former extremes were breached. This made me focus on the Dollar Index chart to see if there is some pattern or trading setup has been shaping amid this unusual market behavior. Continue reading "Gold & Silver: US Dollar Could Spoil Santa Claus Rally"

Is Now The Time To Buy Stocks?

That is the million-dollar question right now given the market action in the equity markets in the last few days. Is this a buying opportunity or has the market reached an important top? It's a very valid question and one I hope to address in today's video.

As I've said before, this is an aging bull market that has been supported in part by quantitative easing (QE) and a very accommodating stance by the Federal Reserve. The Federal Reserve has been thinking of raising interest rates for some time and the last time the Fed raised rates was in June 2006. Continue reading "Is Now The Time To Buy Stocks?"