In addition to investment grade bonds (treasuries, munis & BBB+ rated corporate bonds) which were covered in yesterday's post, a few other potential bottoming plays that stand out at this time are gold, silver & the related mining stocks, cannabis stocks and some the major currencies (vs. the US Dollar) such as the Euro, Yen, Pound Sterling. Essentially, other than the cannabis stocks, which have virtually zero correlation to the stock market or any currencies, including the US dollar, all of the above (gold, silver, GDX, major currencies & even the investment grade bonds) have a fairly strong correlation to the [...]
Gold & the precious metal mining stocks are at resistance while overbought on the near-term time frames while the US Dollar looks poised for a bounce. As such, the odds for a pullback or correction in GLD & GDX are quite elevated at this time. This video starts with an overview of the two largest components of the US Dollar Index, the Euro & Yen, both of which indicate that the recent rally in the dollar which has been the primary driving force behind the recent rally in gold, may soon be over. From there, the charts of GLD & GDX [...]
The USD/JPY (Dollar/Yen currency pair) has triggered the anticipated breakout above this bullish falling wedge, which is a bullish technical event for the US Dollar as the Yen is the second largest component (13.6% weighting) of the US Dollar Index. Horizontal lines mark potential resistance/target levels. The USD/JPY has so far played out exactly as forecasted in the Sept 6th scenario (first chart below), pulling back & bouncing off this support level & going on to break out above the falling wedge. Personally, I don't trade currencies often although I do keep a close eye on the major currencies [...]
It is clear that the recently on & off inverse correlation between the US Dollar and gold prices has once again returned, with a near perfect inverse correlation lately as the dollar & gold react to any economic releases that could impact the next FOMC rate decision. Therefore, if you want to know where gold prices are headed, then all you have to do is figure out where the US Dollar is headed. This 5-minute period chart plots GLD (gold ETP) against UUP (US Dollar ETP). GLD vs UUP Sept 6th Figuring out where the Greenback is heading [...]
The following video is a comprehensive look at the near-term, intermediate-term & longer-term outlook for the US Dollar. Although I don't actively trade currencies, I do follow the US Dollar, as well as the Euro & the Yen, very closely to get a better idea of where dollar sensitive assets such as gold and select commodities are likely headed. Although the video discusses the outlook for the US Dollar, Euro & Yen in more detail, in summary, the $USD, Euro & Yen all broke above/reversed off the resistance levels & chart patterns that we discussed in the Jan 29th Market [...]
The near-term outlook for the US equity markets, crude oil, global currencies, precious metals & miners, and select agricultural commodities.