Loading ...Don’t gets so lost that you depend only on us crazy Americans. Any would invite you but with TSA and the weird weather safer to stay put have your own celebration and watch some good movies or go out.
Got this in a email. He’s pretty good and not pro against anything but what he sees. Can’t post the pic of the charts though. See he expects more downside for both gold and oil. Despite it things have gone up here. Despite what they say that seems to happen in deflation as well as far as textiles etc.
Ten-year Treasury Note yields retreated below 2.30%, signaling another test of primary support at 2.00%. Declining 13-week Twiggs Momentum below zero suggests a continuing down-trend. Recovery above 2.40% is unlikely, but would warn of a rally to 2.65%.
The Dollar Index is testing resistance at its 2008/2010 highs between 88 and 90. Rising 13-week Twiggs Momentum indicates a healthy (primary) up-trend. Expect retracement or consolidation below resistance, but failure of support at 84 is unlikely.
Gold
Low inflation and a strong dollar reduce demand for gold. Low interest rates reduce the carrying cost of gold, but the appeal is muted when inflation expectations remain low. Gold is testing its new resistance level at $1200/ounce. Respect is likely and would confirm a long-term target of $1000*. Declining 13-week Twiggs Momentum below zero indicates a strong down-trend.
Crude Oil
Nymex Light Crude broke long-term support at $76/barrel, signaling a further decline. Sharply falling 13-week Twiggs Momentum reinforces this. Brent crude is in a similar down-trend. Long-term target for WTI is $50/barrel*.
Supply is booming and OPEC members appear unwilling to agree on production cuts [Bloomberg]. Goldman Sachs project WTI prices of around $74/barrel in 2015 [Business Insider], but the following chart of real crude prices (Brent crude/CPI) suggests otherwise.
Prior to the 2005 “China boom”, the index seldom ventured above 0.2. The subsequent surge in real crude prices produced two unwelcome results. First, higher prices retarded recovery from the 2008/2009 recession, acting as a hand-brake on global growth. The second unpleasant consequence is a restored Russian war chest, financing Vladimir Putin’s geo-political ambitions.
I suspect that crude prices are not going to reach the 2008 low of close to $30/barrel, but the technical target of $50* is within reach. Given the propensity of gold and crude prices to impact on each other, the bearish effect on gold could be immense.