See figure 1, a monthly chart. I still think this is the most important chart of all the charts to follow. The breakout is still intact as support levels hold. If there is "hope" for the global economy, it is seen in this chart!
Figure 1. Copper/ monthly
See figure 2, a monthly chart. This is still bearish as confirmed by the monthly close below the pivot low (point 1). It appears that the bounce is starting and 1300 is the level on monthly closing basis. Resistance is at 1400. Let me repeat: this is still a bear market.
Figure 2. S&P500/ monthly
See figure 3, a monthly chart. The failed breakout is noted, but prices are now bouncing off the lower channel line. A move to 1850 or the purple trendline would not be out of the question.
Figure 3. NASDAQ/ monthly
Dow Jones Transportation Index
See figure 4, a monthly chart. This chart gives the bulls hope as a close below a prior pivot low has not yet occurred, so a bear market in the transports has not been confirmed. Nonetheless, there are some very bearish aspects to this chart. The trendline break in the face of multiple negative divergence bars (pink markers) are bearish. It is my contention that the transports are forming a right shoulder of a head and shoulders topping pattern. The resistance area is noted on the chart.
Figure 4. Dow Jones Transportation/ monthly
Dow Jones Utility Index
See figure 5, a monthly chart. Still bearish!! By extension, I would remain cautious on bonds.
Figure 5. Dow Jones Utility/ monthly
The Dollar Index
See figure 6, a weekly chart. Last week's price bar was a positive divergence bar (maroon colored) indicating a short to intermediate term bottom in the Dollar Index. If weakness in the Dollar is to continue we will likely see last week's price bar serve as a range with the highs of subsequent price bars not getting too far above the highs of the current price bar. This is another reason to suspect short term weakness in gold and commodities over the next couple of weeks. A close below the lows of this positive divergence bar means a continuation and possibly acceleration of the down trend.
Figure 6. Dollar Index/ weekly
See figure 7, a weekly chart. The negative divergence bars (yellow markers) should define the price range and support and resistance levels. After this huge run, gold will need some time to consolidate. As long as real interest rates remain negative, gold should remain on your investing and trading radar. It is unlikely that the fundamental picture for gold is going to change anytime soon.
Figure 7. Gold/ weekly
Philadelphia Gold And Silver Sector Index (symbol: $XAU)
See figure 8, a monthly chart. This still remains bullish although the volatility is incredible. That's a 40 point range this month alone or about a 20% drop since the highs. Price is currently at the 10 month (or 200 day moving average). Nothing has changed that would alter my comments from last week. Prices remain above support; the price target is at $260. Prices will likely consolidate around this level to maybe 5% lower. Be patient.
Figure 8. $XAU/ monthly
See figure 9, a monthly chart of the Dow Jones US Steel index. It is still bullish, and like copper, it is still holding on.
Figure 9. Dow Jones US Steel/ monthly
See figure 10, a weekly chart. The first support level is at $99 and the second support, which coincides with support on the monthly chart is at $88. Crude appears likely to moderate in price - price shocks and geo-political surprises notwithstanding.
Figure 10. Crude Oil/ weekly
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Guy M. Lerner may be reached at firstname.lastname@example.org