The DOLLAR is the KEY. The Dollar is about to Fall. I know what you are saying. Everything is going right for the Dollar. Its a textbook sideways consolidation with a breakout. Trump is in office and the Trump Dollar is a winner. Rates are rising and the Dollar is going up. Everyone thinks they have the Dollar Right. (That is the issue)
When Everyone thinks something and emotions run high its time to take a step back and try to get the bigger picture. The dollar below, if it holds above 100 or 99 for that matter YES the bulls win, but if it closes below 99 I think you see a retrace to the 96 range. Which brings me to my next chart…
The USDJPY. TOO FAR. TOO FAST. This will correspond if the Dollar pulls in and it would make sense for the Yen to bounce and USDJPY come back and at least test the 106 area. This makes perfect sense to me. I am expecting this in the coming weeks.
Gold has fallen too far too fast. I am not saying that Gold has bottomed and going to new highs. I was a gold bull the entire 2016 until the past 4 weeks has caused me to reconsider. But Gold WILL bounce here because EVERYONE is bullish the DOLLAR. I am expecting a retest of the 115 first then 118.
TLT has been obliterated. It’s the bull turn. Remember I turned Bearish in July and was targeting 119. Now I have turned. As I have said and my Long Swing Idea was TLT through 119. Targeting 125-127 AT LEAST. I am not saying this isn’t broken but everyone shorting bonds down here is about to get creamed.
The SPY had an outside down week, although the uptrend is still strong. I want this to pull in and go sideways. I welcome a few controlled down weeks. Good for the market. I am a buyer at 215 for sure.
The IWM needs to work off this move. The shorts have been burned. The bears have lost. Now more bears are coming in. They will win in the short term but once this pulls into 125-126 expect a rip back to new highs.
OPEC came to a Deal, and this happened. I said it needed to close out of the noise range and above the 200 day Moving average of which it did both in the same week. When candles like this happen with volume after long term trends they demand some respect. I see Oil targeting $60/barrel and USO at 16 in the coming Months.