Weekly Update – 30 August 2020 – LS Trader

Monday is a Bank Holiday in the UK, but global markets will be trading as usual.

Stocks

Both the Nasdaq 100 and S&P 500 made new all-time highs again this week. The Nikkei 225 made a false breakout above its May high to reach its highest level since February, but then pulled back. The trend is now up for the Nikkei. Of the four stock indices that we trade at LS Trader, only the Dax remains in a long-term downtrend. However, that could change this week.

Commodities

Copper made its highest close since February 2019 as the rally that began at the March low continues. Gold, Silver and Palladium continue to consolidate. The latter is trading within a triangle and is nearing the point of a breakout. Currently, the long-term trend is down for Palladium, the only one of the four metals that we trade where that is the case.

Currencies

The Dollar has seen continued weakness this week as most of the majors continue to make new highs for the current move against the Dollar. The long-term trend is currently down for the Dollar against all the majors, and, the Dollar Index. The Dollar Index tested the early August low this past week and may exceed it this week.

Interest rate futures

Interest rate futures continue to consolidate, but the short-term weakness is evident. A change of long-term trend to down is within range for the 30 Year T-Bond, and the UK Long Gilts. Two-month lows were printed this week in the 30 Year Bonds, and 10 Year Notes.

Weekly Update – 22 August 2020 – LS Trader

Stocks

The Nasdaq 100 ended the week with a new all-time high close. The S&P 500 also made a new all-time high weekly close. Clearly, the trend is up for both markets.

The Dax and the Nikkei are both in long-term downtrends, but both are within range of breakouts that would complete a trend reversal to up.

Commodities

Copper rallied to reach its highest level since April last year but has pulled back since the breakout. Gold and Silver continue to chop around, but both remain in long-term uptrends. Silver remains strongest and is holding above short-term support.

The energy sector continues its recent recovery and has already seen a couple of markets in the sector complete a trend change to up, with the remaining markets testing resistance.

Currencies

The Dollar Index ended the week higher as there are signs that a bottom may be forming, at least for the short-term. Currently, the trend remains against the dollar against all of the majors.

Interest rate futures

Interest rate futures continue to trade in a sideways quiet channel as volatility remains at very low levels. The long-term trend remains up across the sector. Upside breakouts are within range for all markets in the sector. Change of long-term trend to down levels are likely out of range for at least another week or so.

Weekly Update – 15 August 2020 – LS Trader

Stocks

The Nasdaq 100 began the week with weakness but bounced off support at fair value and came back to test the all-time high printed the prior week. The trend remains up.

The S&P 500 completed its recovery from the February/March crash and recorded a new all-time high this week. The trend remains up for the US stock indices but is still down for the Dax and the Nikkei 225.

Commodities

Gold and Silver both corrected sharply this week. Gold’s reversal was sufficient to break fair value and support and bring the current trend to an end, for now. Silver held up better and remains above support.

Currencies

The Dollar has had a mixed week again, gaining against some of the majors and falling against others. The Dollar Index itself ended the week lower and may test the recent lows again this week.

The British Pound is within range of a breakout and change of long-term trend to up against the Dollar.

The Euro found support this week against the Dollar and has pushed back up towards the local top, which may be tested this week. The correction has burned off some of the volatility excess, but momentum remains strong. The RSI fell to and then bounced from the 60 level, which is normally the sign of a strong trend.

Interest rate futures

Interest rate futures moved lower this week, and the uptrend is likely over for now. Volatility has expanded as the markets moved to the downside. The long-term trend remains up, and these markets remain within the sideways range that has contained the majority of trade since March.

Weekly Update – 9 August 2020 – LS Trader

Stocks

From last week on the Nasdaq 100, “The market continued its rally from the spring pattern printed during the prior week but has not yet completed the recovery to print a new all-time high. We may see that this week.” The Nasdaq 100 did complete the recovery and broke out to new all-time highs once again. The S&P 500 also completed a breakout and change of long-term trend back to up but remains below its all-time high.

Commodities

Gold and Silver have both continued their sharp rise this week, until Friday, where both markets experienced sharp reversals. The trend remains up for both, but as we have written in recent weeks, volatility is extremely elevated and likely at unsustainable levels short-term. The trend is up and is expected to remain so for the foreseeable future, but a correction back to fair value is probable.

Currencies

The Dollar has had a mixed week. The rally that began with a bullish engulfing pattern on the prior Friday fizzled out quickly, and the market came back down to test that previous week’s low. Friday again saw a bullish candle, so the index is trying to bottom. For now, the trend remains against the Dollar.

Interest rate futures

Interest rate futures made new highs for the current move but ended the week slightly lower. They continue to trade in a shallow volatility environment. The trend remains up.

Weekly Update – 2 August 2020 – LS Trader

Stocks

The S&P 500 ended July with an all-time high close but remains below its all-time high posted back in February.

From last week on the Nasdaq 100 “Friday did see some buying come in to close the market off the lows with a spring. The trend remains up.” The market continued its rally from the spring pattern printed during the prior week but has not yet completed the recovery to print a new all-time high. We may see that this week.

Commodities

From last week: “The metals markets have seen some big moves, with Gold and Silver making multi-year highs. Silver looks vulnerable to a correction due to reaching a volatility extreme this week.”

Silver began the week with strength to reach an even higher volatility extreme than was seen the prior week, followed by a large long-legged doji-style candle on Tuesday. The market has since consolidated within Tuesday’s wide range.

Gold crossed the $2000 level for the first time in history and made a new all-time high close. However, price closed $20 off the high of the day. As with Silver, Gold is at elevated volatility levels.

Currencies

From last week “The long-term trend is now down for the dollar against all majors except the British Pound.”

The Dollar has seen continued weakness across the board but did print a bullish engulfing pattern on Friday from a position of elevated volatility. We may see some corrective rally from here, but the trend remains down.

Interest rate futures

Also from last week “Interest rates futures continue to grind gradually higher in a very low volatility environment, with a slight upward bias…However, the price action is far from compelling.” Interest rate futures have made the long-anticipated breakout and continue to grind very slowly higher. The trend remains up across the board.