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Market Outlook: Stocks, Bonds, Gold, USD and Oil

  • Written by Syndicated Publisher No Comments Comments
    July 17, 2013

    The following is an excerpt from the July 16, 2013 blog for Decision Point subscribers.

    The SPX had a modest decline early in the day, then consolidated in a narrow range the rest of the day.

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    Stocks: Based upon a 12/10/2012 Thrust/Trend Model buy signal, our current intermediate-term market posture for the S&P 500 is bullish. The LT Trend Model, which informs our long-term outlook, is on a buy signal as of 12/13/2012, so our long-term posture is bullish.

    After eight consecutive days of advancing prices, the S&P 500 Index took a break as it backed off the horizontal resistance drawn across the May top. Volume expanded but is still well below average.

    Screen shot 2013-07-16 at 1.36.49 PM

    The ultra-short-term CVI and Participation-UP indicators are now neutral, and they do not pose a threat in that time frame.

    Screen shot 2013-07-16 at 2.26.44 PM

    Short-term indicators are still overbought, but have come down from recent extreme readings.

    Screen shot 2013-07-16 at 2.27.11 PM

    Intermediate-term indicators are becoming more overbought, but they still have room to run. I do note that they have decelerated.

    Screen shot 2013-07-16 at 2.27.37 PM

    Conclusion: With short-term indicators being overbought, and price near resistance, the market is vulnerable for some kind of consolidation or correction; however, we cannot automatically assume that will be the case. If intermediate-term indicators top, that would be troublesome.

    Dollar: As of 7/3/2013 the US Dollar Index ETF (UUP) is on a Trend Model buy signal. TheLT Trend Model, which informs our long-term outlook, is on a buy signal as of 3/13/2013, so our long-term posture is bullish.

    UUP moved below last week’s low, presumably on the way toward the June low. It is very close to generating a PMO sell signal — the PMO will probably cross through its EMA tomorrow, unless there is a sharp reversal. Which ain’t out of the question.

    Screen shot 2013-07-16 at 1.28.40 PM

    Gold: As of 12/6/2012 Gold is on a Trend Model neutral signal. The LT Trend Model, which informs our long-term outlook, is on a sell signal as of 2/15/2013, so our long-term posture is bearish.

    Gold is advancing toward the resistance of the next declining tops line. A rising wedge dominates the short-term pattern. The technical expectation is for the wedge to resolve downward, possibly for a retest of the June low.

    Screen shot 2013-07-16 at 1.33.36 PM

    Crude Oil (USO): As of 6/7/2013 United States Oil Fund (USO) is on a Trend Model buysignal. The LT Trend Model, which informs our long-term outlook, is on a buy signal as of 7/3/2013, so our long-term posture is bullish.

    USO is consolidating the advance of the last three weeks.

    Screen shot 2013-07-16 at 1.27.30 PM

    Bonds (TLT): As of 5/20/2013 The 20+ Year T-Bonds ETF (TLT) is on a Trend Modelneutral signal. The LT Trend Model, which informs our long-term outlook, is on a sell signal as of 5/29/2013, so our long-term posture is bearish.

    TLT generated a PMO crossover buy signal, but price remains within the declining trend channel.

    Screen shot 2013-07-16 at 1.26.19 PM

    Technical analysis is a windsock, not a crystal ball.

    Images: Flickr (licence attribution)

    About The Author

    Carl SwenlinCarl Swenlin is a self-taught technical analyst, who has been involved in market analysis since 1981. A pioneer in the creation of online technical resources, he is president and founder of DecisionPoint.com, a premier technical analysis website specializing in stock market indicators, charting, and focused research reports. Mr. Swenlin is a Member of the Market Technicians Association.
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