Weekly Update – 1 September 2019 – LS Trader

Monday is Labour Day in the US, so US markets will be closed.

Stocks

Stocks had a bullish week. US stocks reversed from above key support and remain in long-term uptrends.

The Nikkei rallied sufficiently to break resistance and bring the downtrend to an end for now. Both the Nikkei and Dax remain in long-term.

Commodities

Silver exploded higher this week, rallying above 1800 to make its highest print since November 2011. Gold made its highest print since April 2013. Both metals came off their highs for the week by Friday’s close, but the trend remains up.

Currencies

The Pound ended the week lower by 0.99%. There will likely be further Brexit shenanigans this week. The long-term trend remains down, but commercials remain very close to an all-time net long position. Sentiment remains negative, with only 17% reporting as bullish. $1.20 remains a crucial level.

The Dollar had a strong week, with the Dollar Index rallying by 1.36% to end the week at its highest level since May 2017. This dollar rally pushed the Euro to its lowest level also since May 2017. Sentiment on the Euro has fallen to only 9% bulls, but, unlike the Pound, there is barely any commercial buying to be seen.

Interest rate futures

Interest rate futures rallied again this week to new highs for the current move. UK Long Gilts recovered from the breach of support during the prior week to hit new all-time highs and resume the uptrend. All five markets that we trade in the interest rate futures sector are bullish and remain in long-term uptrends.

Weekly Update – 25 August 2019 – LS Trader

Stocks

The S&P 500 and the Nasdaq 100 both ended the week lower, but remain in long-term uptrends. However, price has now fallen to the middle of the range, and a change of trend to down is within range and could be seen over the coming weeks.

The Nikkei held below resistance and remains in a long-term downtrend. The Dax rallied sufficiently to kick us out of our short position, but the trend remains down, and we may soon see a new breakout to the downside.

 

Commodities

Gold declined during the week but put in a strong rally on Friday. Silver traded similarly. Both markets ended the week with a new high close for the current move.

Copper remains the only metal in a long-term downtrend. Friday saw Copper decline to a new low for the current move. The weakness seen on Thursday and Friday was accompanied by above-average volume.

 

Currencies

From last week: “The British Pound has held support. The trend remains down, but new strength suggests resistance may be tested soon. Commercials remain very near an all-time net long position.” The Pound rallied and broke resistance as expected, bringing an end to the downtrend for at least the short-term. The long-term trend remains down, but prices are rallying in the short-term. Powered by near-record net long commercials, this rally could go further than many expect.

 

Interest rate futures

Interest rate futures declined during the week but found support on Friday to keep the uptrend intact. The long-term trend remains up across the board.

UK Long Gilts were the weakest in the sector, and they broke short-term support this week, resulting in the LS Trader system exiting its second-most profitable trade of the year, where we had been long since May, capturing a huge move.

Weekly Update – 18 August 2019 – LS Trader

Stocks

The Dax completed a change of long-term trend to down, but so far without follow-through. The Dax joins the Nikkei in a long-term downtrend, but neither index has made any progress to the downside since the breakout.

The S&P 500 and Nasdaq 100 both continue to trade in volatile fashion but remain in long-term uptrends.

Commodities

Gold reached its highest level since May 2013. Silver reached its highest level in 14 months. Both remain in long-term uptrends. Copper is the only metal currently in a long-term downtrend. Copper retraced this week to test the prior breakout level, which is now acting as resistance. The RSI remains in the bear range.

The energy markets continue to trade in a volatile fashion. Brent Crude, Natural Gas and Heating Oil are all in long-term downtrends. The latter rallied above short-term resistance this week.

Currencies

The British Pound has held support. The trend remains down, but new strength suggests resistance may be tested soon. Commercials remain very near an all-time net long position.

The long-term trends continue to favour the dollar overall. The Dollar Index itself has continued its receiver since support held.

Interest rate futures

The 30-year T-Bond made a new high print since October 2016 as interest rate futures continue to rally. Commercials are back to a net long position.

Interest rate futures remain in long-term uptrends across the board.

Weekly Update – 11 August 2019 – LS Trader

Stocks

Stocks saw considerable weakness during the week, followed by a strong recovery to retrace most of the week’s declines. This has left a strong hammer-like pattern on the weekly chart. It is not a hammer because the trend is wrong. There was not enough downtrend for it to be a reversal pattern, and, in terms of strict definition, the lower shadow was too long. However, the long-term trend remains up for the Nasdaq 100 and the S&P 500.

 

The trend is also still up for the Dax, but a change of trend to down is within range and could be completed in the coming weeks if we see additional weakness. The weakest of the stock indices is still the Nikkei, which never completed a change of trend to up when the other indices did. The Nikkei, therefore, remains in a downtrend.

 

Commodities

Gold advanced another 3.82% to reach its highest level since 2013. Silver also rallied and crossed above the 1700 level for the first time in 14 months. Except for Copper, the metals remain in strong uptrends.

 

Currencies

The British Pound made a new low print since January 2017, narrowly holding to the 1.20 level. The trend is down and may continue further, but sentiment is near a bearish extreme, with only 12% bulls, and, more importantly, record commercial buying. This week’s COT data shows that commercials now have their biggest net long position in history. Commercials are nearly always right at extremes, but often early. When this market turns, the move to the upside could be explosive.

 

Interest rate futures

Interest rate futures exploded higher again this week. The 30-year T-Bond made its highest print in almost three years, as the long-term uptrend remains intact. UK Long Gilts rallied to a new all-time high.

Weekly Update – 4 August 2019 – LS Trader

This past week saw the expected heightened volatility surrounding the Fed meeting on Wednesday. The Fed cut rates by 25 basis points, but the market was expecting more.

Stocks

Stocks broke lower in volatile fashion this week, breaking short-term support in the process. The long-term trend remains up, but this week’s action has done some technical damage. The RSI on the S&P 500 has closed right on the 40 level, which is bull market support, so next week could be a pivotal week. A decisive move below the 40 level will indicate considerable further weakness and a range shift in the RSI to bearish.

Commodities

The metals sector saw some wild swings this week. Gold, Silver and Palladium all remain in long-term uptrends. Copper, the only one of the four metals that is in a downtrend, broke recent support to fall to its lowest level since January.

Currencies

The British Pound fell to its lowest level since January 2017. The long-term trend is still down. However, there has been some evidence of buying due to the long lower shadow on Thursday’s candle followed by a bullish engulfing candle the next day, so we may see a corrective bounce. Another factor of interest is that commercials, the smart money, registered their third-largest long position in history on the Pound, so the smart money does not perceive Brexit to be bearish.

Interest rate futures

Interest rate futures rallied sharply this week, breaking to the upside. We have written in recent weeks that the long-term uptrend was intact and that price structure was incomplete and that we were expecting new highs in these markets. We got them this week.

Weekly Update – 28 July 2019 – LS Trader

This week sees the FOMC meeting on Tuesday and Wednesday where the Fed is widely expected to cut rates. The question is, how much will they cut by and will it be enough as perceived by the market? Expect volatility around the time of the announcement on Wednesday at 7 pm BST.

Stocks

Both the S&P 500 and the Nasdaq 100 made new all-time highs this week.

The Dax rallied to test the high printed earlier this month but reversed sharply on Thursday with a big down day.

The Nikkei also rested resistance but also failed to breakout. Resistance was also found at the 60 level on the RSI. If both levels can be decisively broken, we could see a rally to the next level of resistance around 2250.

Commodities

Gold continues to trade in volatile fashion but remains in a long-term uptrend and above support.

Silver rallied to its highest level since June last year but is finding resistance at the 200-week MA.

Currencies

The dollar has seen strength return this week, with the Dollar Index rallying higher for six days, making a breakout on the back-adjusted continuous chart to its highest level since March 2013. This move also saw the dollar push the Euro to new lows for the current move. The British Pound also fell to a new low since April 2017.

Interest rate futures

Interest rate futures continue to consolidate in a range not far below recent highs. These markets could see volatile swings this week due to the FOMC meeting. The long-term trend is up for these markets, and considerable weakness will be required before that changes.

The only market in the sector in a current active uptrend is the UK Long Gilt, which this week came close to its all-time high, printed back in August 2016.

Weekly Update – 21 July 2019 – LS Trader

Stocks

Both the Nasdaq 100 and the S&P 500 made new all-time highs this week, but both corrected lower to end the week down.

The RSI has dipped below the 60 level but remains very much in the bull range, and the long-term trend remains up. However, the close below the April high, which should have held firm due to change of polarity, does put a question mark against the current trend.

Commodities

Gold broke out to the upside from the triangle to print its highest price in 6 years. Silver also had a strong week, rallying to its highest level in over a year.

Palladium, which has been the strongest of the metals of late, and the only one to hit new all-time highs this year, had a corrective week and saw prices break below short-term support.

Currencies

The dollar has had a mixed week. The Dollar Index ended the week slightly higher but remains within a trading range. Some of the majors have shown some strength against the dollar, with both the Australian and New Zealand dollars reaching their highest levels since April.

Meanwhile, at the other end of the scale, the British Pound fell to its lowest level since April 2017 before posting a mild recovery. As with the Pound, the Euro remains in a long-term downtrend but is currently in a trading range.

Interest rate futures

The trend for interest rate futures remains up, and some strength has been seen this week. The current technical picture suggests that the rally is not done and that we will see new highs above the highs printed at the start of the month.

Weekly Update – 14 July 2019 – LS Trader

Stocks

Both the S&P 500 and Nasdaq 100 made new all-time highs this week, as well as all-time high weekly closes. The bull market remains intact, and the long-term trend is indisputably up. The RSI remains in the bull range. As expected during this time of year, volume has declined as the rally has persisted, and volatility is waning. If these markets can hold above the breakout levels on a closing basis, that may form a platform for considerable further rally.

Commodities

Palladium made new all-time highs again this week but did come off slightly by Friday’s close. Gold continues to consolidate above support. The energy markets have continued to rally.

Coffee had shown signs that a new bull market may have been starting, but that has stalled. The market has tested support multiple times this week, which so far has held firm.

Currencies

The dollar has seen weakness this week across the board. The long-term trend continues to favour the dollar overall but is weakest and in a downtrend against the Canadian dollar.

The British Pound fell to its lowest level since December during mid-week but has put in a decent bounce since. The trend, for now, remains down.

Interest rate futures

From last week: “Interest rate futures made new highs on Friday but made a key reversal day. Price action on the 10 Year T-Note engulfed the real bodies of the last 11 days, which suggests that further weakness lies ahead and that support will be broken on both the 5 & 10 Year Notes this week.”

Interest rate futures saw the expected weakness this week, and we exited both the 5 & 10 Year T-note long positions for decent profits. Weakness has been seen across the board in the sector, with only the UK Long Gilt in a current long position. Gilts will likely at least test support this week.

Weekly Update – 7 July 2019 – LS Trader

Stocks

From last week: “The S&P 500 is leading the way to the upside but failed to clear the prior week’s high and is grappling with a clear resistance zone. A decisive breakout above this resistance would be bullish.”

This week saw the decisive breakout and a new all-time high weekly close on the S&P 500. The Nasdaq 100 also made a slight new all-time high intraday but closed lower back below prior resistance.

The Dax gapped higher at the start of the week and rallied to its highest level since August last year. Only the Nikkei is currently in a long-term downtrend. All the other stock indices are in a bull market.

Commodities

Gold has seen some wild daily price swings this week but continues to hold above support, and the trend remains up. The trend is also up for Palladium, which made an all-time high weekly close.

Currencies

The Dollar had a strong week, which held off the potential change of trend to down and remains in a long-term uptrend. The British Pound fell to its lowest level since the 1st week of the year. UK Gilt prices are indicating rate cuts on the horizon, which is putting pressure on the Pound.

Interest rate futures

From last week: “However, there has been a bearish divergence between price and RSI, as mentioned last week, as well as volatility contraction, and declining volume. The trend remains up, but weakness towards a test of support looks likely.”

Interest rate futures made new highs on Friday but made a key reversal day. Price action on the 10 Year T-Note engulfed the real bodies of the last 11 days, which suggests that further weakness lies ahead and that support will be broken on both the 5 & 10 Year Notes this week.

Weekly Update – 30 June 2019 – LS Trader

Stocks

Stocks ended the week lower, but the long-term uptrend remains intact for all the stock indices we trade at LS Trader, except for the Nikkei.

The S&P 500 is leading the way to the upside but failed to clear the prior week’s high and is grappling with a clear resistance zone. A decisive breakout above this resistance would be bullish.

The Dax and Nasdaq 100 are both within range of upside breakouts to resume their respective uptrends. The Nikkei remains rangebound.

Commodities

From last week on Gold: “However, the rise has been parabolic this past week, and bullish sentiment is extremely high. It could be that we will see some weakness this week, back towards the 1360 level, before the rally continues.” Gold continued the parabolic rally early this week, before peaking at 1442.9 and reversing sharply back to 1400. Sentiment is a little lower but still elevated. The long-term trend remains up, with the market above support, but further correction could be seen before we see 1442.9 exceeded.

Currencies

From last week: “The Dollar Index broke medium-term support and a trendline that has been in place since September 2018. This may lead to further dollar weakness. “ The Dollar Index ended the week lower but has spent most of the week consolidating the prior week’s declines. We may see some strength for another test of the underside of the trend line before prices move lower. For now, the long-term uptrend remains intact, but critical support could be tested this week.

Interest rate futures

Interest rate futures are consolidating near their recent highs. However, there has been a bearish divergence between price and RSI, as mentioned last week, as well as volatility contraction, and declining volume. The trend remains up, but weakness towards a test of support looks likely.