Mr.Dev (s)

Mr.Dev(s) is a team of non-biased certified technical and research analysts with extensive experience in the financial markets dating back to 1997. They accurately forecast market movements and position their clients accordingly. They are popular online contributors on many channels and platforms, known for their non-biased advice and commitment to helping investors make informed decisions. The team is also the founder of forex account management services on Moneymunch.com, demonstrating their knowledge and experience in the financial world. Investors can rely on Mr.Dev(s) for research reports and opinions, as well as trading guidance.

Join Today (Free): Commodity Tips | Forex Signals

S&P 500: Complicated from Here

0 2417

While things are never easy, the (quote-unquote) obvious trade in the major indexes has now played out, especially on the S&P 500.  Of course most of it happened in an overnight gap up, but that has been par for the course.  From here things get more complicated.  Here are a few ways to look at the roadmap utilizing the S&P 500.

First the original S&P 500 chart that has been in play for months, looking at the June-Sep run, and pullback since.   Two key points here – the index has bounced from the 61.8% retrace to nearly the original 38.2% retrace at ~1395.   That number is also key in that it was support multiple times in August 2012.  Support turns into resistance and vice versa so this 1395 level is a very obvious level to watch.

s-and-p-500

Second, is the chart I posted yesterday morning which is simply the same Fibonacci levels but focused solely on the September-November pullback.  What’s the first number that sticks out?  1394 (call it 1395, close enough for government work).  That is the 38.2% retrace of the two month correction.

s-and-p-500-index

If 1395 is vanquished, the next two levels are 1409 to 1424 which you can see was an area with a lot of traffic in late October to early November before the correction became much more ferocious.   That second number also coincides with a falling 50 day moving average.

Last, on a very short term frame there is a potential for an inverse head and shoulders formation (which favors bulls) in the near term.  The head being Thursday/Friday’s lows and the neckline being about “here” at 1390.   If that does play out, it measures to a target of ~1430.  That would be a 3% move from here.. and still not create a new higher high versus those early November levels.  Hence all that could in theory happen and still bode poorly afterwards.   But either way, one can see all the congestion and push pull in the areas overhead.

Of course all this coincides with positive seasonality, the constant negotiations re: the fiscal cliff, the next round of easing to be announced at December’s FOMC meeting (to replace Operation Twist), and a slowing corporate earnings outlook.

Anyhow enjoy the Thanksgiving holiday and we’ll catch you on the other side.

Continue reading

Monthly Charts Clarify Pre-Drediction for Gold and Silver

0 2371

We’ve been surprised at the recent action in the precious metals complex. During the recent correction the shares were showing quite a bit more strength than the metals. Then the shares took a dive below support yet the metals maintained their recent lows! How do we interpret this wild volatility in the relationship between the shares and the metals? Quite often we look at daily and weekly charts. Now is the time to take a look at the monthly charts which can help us get a better read on the larger trends at hand.

The monthly chart of Gold shows the yellow metal in a very healthy consolidation between $1550 and $1800. Gold’s current retreat from $1800 has lasted two months. Back in 2009, Gold brokeout to a new all-time high in the seventh month of its consolidation. Presently, Gold’s bollinger band width is at a multi-year low and its three-month volume average is at a two year low. Also, the RSI has bottomed and made a higher low. Even if Gold touched $1600, it would remain in healthy position for a breakout in 2013.

gold-buy

Gold’s companion Silver is currently trading in a tighter consolidation with $35 as resistance and $27 as support. Note that Silver has tested and held above $27 six times in the last fifteen months. Silver also held above the rising 40-month moving average which supported the market in 2009 and 2010. The RSI has also made a higher low and volume has trended down during the past seven months.

silver-buy

Meanwhile, the gold stocks (HUI) look weaker than the metals. Momentum hasn’t confirmed its bottom as the market is in a clear range from 400 (support) and 525 (resistance). Note the current 11% decline in the HUI for the month while Gold and Silver are still in positive territory. Nevertheless, if and when the HUI prints a monthly close above 525, this chart would like quite bullish and general sentiment would certainly pick up.

gold-and-silver

The evidence argues that the bottoms remain well intact and the metals are consolidating before the next breakout which entails Gold breaking $1800 and Silver $35. However, these breakouts are by no means imminent. Since we are dealing with monthly charts that means potentially three or four more months of consolidation. Furthermore, sentiment data such as the COT structure and public opinion polls need some improvement before the market could sustain a breakout. Thus, more consolidation could be the order of the day for the metals.

Continued consolidation in the metals also helps explain recent weakness in the HUI, which is simply testing the lower half of its own consolidation. The shares see the weakness in the overall market and perhaps sense that an immediate breakout in the metals is unlikely Furthermore, while central banks have put themselves in position to act they haven’t actually done anything yet. When the market senses their action it will likely mark a final low within this consolidation.

The good news is the metals remain in fine shape and so to do most of the mining equities we follow. If we are indeed correct that the metals and shares will remain range bound then your task is simple. Prepare yourself for further consolidation by having your buy list ready and then be ready to act when the time comes. A wise friend once told me that in a bull market the goal is to accumulate positions at the lowest prices possible. With mining equities trading well off their highs, now is the time to do your research and find the companies that will lead the next leg higher and outperform the gold stock sector.

Good Luck!

Continue reading

S&P 500, Dow Jones and EURO

0 2141

Yesterday SPX fulfilled the script of a narrow range body, it’s the common candlestick (in this case a bearish Hanging Man) that usually follows a white Marubozu. It means consolidation of the previous gains and hesitation.

This pattern could evolve into a bearish reversal pattern ” Evening Doji Star” if today we get a gap down and go. But this is not my preferred scenario.

Regarding the overall count from the September 14 high, I don’t even change a comma, since I remain firmly confident that the current “countertrend” rebound will top in the target box that I have been highlighting in the last few days. Critical overhead resistance is now not far away, either 1397 or a kiss back at the previous trend line support off the October 2011 now converted into resistance.

Once/if price confirms my preferred scenario the last wave (C) down, which could match the length (89.1 points) of the previous down leg; wave (A), is expected to complete the EWP off the September 14 high, hopefully with positive divergences.

For the short term the 10 d mas = 1375.17 could be the demarcation between a mild pullback and something more bearish.

sp-500-price

Regarding the labelling of the current rebound so far we have a 3-wave up leg or a corrective variant (DZZ) therefore we have 3 options:

  • The “oversold” bounce is over ==> the wave (B) is done.
  • Price has established the wave (Y) of a larger Double ZZ.
  • Price has established the wave (A) of a larger Zig Zag.

So we need to see the internal structure of a pullback in order to increase the confidence on a count.

For the immediate time frame yesterday’s down leg after completing an Ending Diagonal suggests that there should be at least one more down leg.

sp index

As I mentioned yesterday I am watching:

1. EUR: “Since in my opinion the internal structure of the rebound off the November 13 lod is clearly suggesting that in the near future price has more business to the down side. So far bulls here are struggling to reclaim the 200 d ma, which coincides also with a strong horizontal resistance, while slightly above there is the steep declining 20 d ma. Barring “good news”, with the current weak structure, which could be shaping a bearish Flag, price should reverse in the range of the Trend line resistance in force since the October 17 high and the next horizontal resistance at 1.2876″.

So far price is maintaining the sequence of higher lows hence if price breaks above 1.2840 (trend line resistance off the October 17 high) then within the corrective pattern in progress price could extend the move towards the next resistance located at 1.2876.

euro

2. VIX: we now have to watch the trend line support and the possible “sell equity signal” that would be issued with en eod print above the Bollinger Band of the Envelope > 15.50.

Yesterday’s doji + oversold Stochastic are favouring at least a bounce attempt, although ahead of Thanksgiving holiday it may not be a reliable indicator.

sp-500-vix

I wish a wonderful Thanksgiving to US readers.

Continue reading

Gold and Silver Trading Tips Report

0 2070

gold-spot-price3

Gold-and-Silver

Arguments for lower prices:

  • 3rd attempt (within 11 months) to take out heavy resistance around US$1,790.00-1,800.00 failed and Gold clearly broke down from bearish wedge in October
  • COT Data again pretty bearish for gold and silver
  • Mining Stocks crashed down through support and 200-MA
  • US-Dollar in short term uptrend since mid of september, so far no clear trend reversal
  • Recession in Europe, slower demand from China and India

Arguments for higher prices:

  • Gold & Silver bounced impulsively from oversold levels. This price action has a very bullish character.
  • Gold clearly above 200-MA (US$1,665.66)
  • Reversal at Fibonacci retracement, this confirms “correction” within uptrend
  • Gold/Silver ratio heading lower again, creates MACD buy signal for precious metals
  • Longer term Gold in similar correction pattern like 2008/2009. Breakout to US$2,000.00 expected to happen in summer 2013
  • New uptrend in precious metals since august 2012 that should carry gold up to US$1,850.00 and 1,900.00 until spring 2013.
  • US-Dollar Death Cross (long-term 200-MA broke above its short-term 50-MA in mid of october). This signals dollar weakness!
  • November very bullish seasonals. Seasonality until spring very promising.
  • Never fight the FED. Unlimited QE -> money printing all over the world will push asset prices in all sectors higher…
  • Throughout history, periods of massive money creation have always been inflationary and this time should be no different.
  • Santa Claus/Year End Rally has probably started yesterday
  • massive tension and escalation in middle east (Israel & Gaza, maybe Egypt and other states to get involved ?)

Conclusion:

  • After the initial impulsive bounce from oversold levels Gold has been consolidating between US$1,740.00 and US$1,705.00 in a bullish fashion. Now Gold looks ready to break out above US$1,740.00 very soon. This breakout will start a heavy wave of buying/short covering and should bring gold very fast to next resistance at US$1,790.00 / US$1,800.00. Here another setback must be expected. Overall I continue to believe that Gold will move up to US$1,850.00 and around 1,900.00US$ until spring 2013.
  • Any break below US$1,705.00 and especially US$1,696.00 would be very bearish but is not expected.

Long term:

  • Nothing has changed
  • Precious Metals bull market continues and is moving step by step closer to the final parabolic phase (could start in 2013 & last for 2-3 years or maybe later)
  • Price target DowJones/Gold Ratio ca. 1:1
  • Price target Gold/Silver Ratio ca. 10:1
Continue reading

Indian Gold Demand Picks Up

0 2355

Indian Gold Demand Picks Up

The love for gold has been reignited in India, according to the World Gold Council (WGC) in its Gold Demand Trends for the third quarter of 2012. India regained its title as the strongest performing market, overtaking the greater China area, as the country experienced a bounce-back in demand due to improved sentiment during the festival season.

Compared to the third quarter of last year, Indian gold jewelry demand grew by 7 percent while gold bar and coin demand rose 12 percent. Total consumer demand was 223 tons, compared to 205 tons this time last year. The second largest market was Greater China, which consumed 185 tons in the third quarter of 2012. This was less than the 201 tons consumed in the third quarter of last year.

Together these markets in the east made up 55 percent of the world’s jewelry and investment demand, according to the WGC. indian-gold

Although India experienced a setback earlier this year when gold shops boycotted a proposed tax on the yellow metal, imports recovered by July “as inventory levels were bolstered (aided by a well-timed dip in the local price) and the market adjusted to the customs duty,” says the WGC.

The third quarter has historically been a strong seasonal time for the Love Trade to come alive in the east. Monsoon rains and the festival season in the fall are generally associated with the buying and giving of gold. Still, for the year, don’t expect the Love Trade in India to be as strong as it was in 2011, as gold demand remains subdued with the ongoing weakness of the rupee.

Read More…

Continue reading

ETF (GOLD & US Dollar)

0 2494

On its way down from 168, GLD broke its first support level and came to rest on the second (200-DMA) from which it had a bounce. Last week, I suggested that it might find some resistance on the small horizontal red trend line, which it has, and which caused it to pull back three points. It’s difficult to see how it could have much more of a decline right away if the market is going to have a mid-correction rally, so we can probably expect the near-term trend to turn up again, perhaps reaching the top channel line (blue) before rolling over again.

Gold Etf

If GLD does not have much of a rally from here – especially if the market does rally – it will be an indication that some decent weakness can be expected into the cycle low. In any case, subsequent action should form a P&F pattern which will help us determine the extent of the decline into the 25-wk cycle low.

UUP (dollar ETF)

UUP normally goes against equities and gold. The index appears to be extended short-term and eady to pull-back. This can be seen in the indicators, one of which is very overbought and the other beginning to show some negative divergence. If a short-term top is forming, this should help the market to find a short-term low.

US Dollar ETC

Continue reading