Mighty Market Continues Advance

The exponential move of the last phase is even more visible on the hourly chart with the last few days going nearly vertical, most likely as a result of news of the signing of the phase one trade agreement. A lot of folks disregarded the old adage “buy on the rumor and sell on the news” and they will probably live to regret it.

At the hourly level, the indicators did not fail to warn us that the end is near.In spite of the price strength going into Friday, the A-D oscillator went in the opposite direction and gave a sell signal. Even the momentum indicators showed negative divergence.

Everything considered, it is easy to understand why traders were already cautiously taking profits in the futures after Friday’s close. 

$USD daily (courtesy StockCharts)

USD moved higher into the resistance area created by the junction of two important MAs. This is likely to put a temporary halt to the move from 96.06, especially since it appears to be forming a 5th wave from that low. After stalling around its current price level, it should start a consolidation phase.

GDX (Gold miners ETF) daily

GDX is holding above its trend/channel line, and if it can manage to stay above it for a few more days, it may be in a position to challenge its recent short-term high near the 30 level. A break of the green channel line will extend the correction since that would also be a break of the 50-dma which, as you can see on the chart, has consistently affected the trend. 

PASS (Pan American Silver Corp.) daily

PAAS is approaching its 50-dma.If it can hold above it, it could be in a position to resume its uptrend. It too would need to hold above the 50-dma which is less than a point below its Friday close.  

BNO (U.S. Brent oil fund) daily

Profit taking quickly occurred after BNO reached its 22 price projection. With the market ready for a sharp correction, BNO is likely to lose more valuation over the short term. 

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Analysis of the short-term trend is done on a daily basis with the help of hourly charts. It is an important adjunct to the analysis of daily and weekly charts which discusses the course of ...

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