Here are my discretionary thoughts on forex and commodities. I only trade the S&P 500.
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- Most commodities have bullish price action.
- The U.S. dollar’s price action is bearish.
- Gold & silver have bullish price action.
3 pm: Most commodities have bullish price action.
There is a positive correlation between the U.S. stock market and commodities (oil, gold, silver) right now.
Crude oil was insanely overbought on a weekly bar chart and gold/silver were bumping up against multi-year resistances. They should have made a sizable correction when the S&P cratered over the past few days. Instead, oil/gold/silver made small pullbacks. This is bullish price action.
In addition, the gold:silver ratio isn’t rising today despite the recent downtrend in precious metals. This is a bullish factor for gold and silver.
7 am: the U.S. dollar’s price action is bearish.
There is an inverse correlation between the S&P 500 and the USD Index. The S&P 500 crashed yesterday, but the U.S. Dollar Index barely went up. Now that the S&P 500 has stabilized, the USD Index cannot go up anymore. This is bearish price action.
7 am: gold and silver have bullish price action
There’s an overall inverse correlation between gold/silver and the U.S. dollar. Gold and silver’s recent price action has been bullish.
The U.S. dollar went up a little yesterday as the S&P 500 went down. Gold and silver should have went down yesterday, but they didn’t. The USD Index is going down this morning, and gold/silver are up. This is bullish price action.
Read Forex & commodities on February 5, 2018.
I only trade stocks. These are just my thoughts/outlook on other markets.
- Gold and silver will break above their tight range in the first half of 2018.
- The USD Index will crater below its final support (90-91) in the first half of 2018.
- The best traders I know are still bullish on Bitcoin in the short and long term. I don’t know when the crypto bubble will end.