Slowl

Thursday Sept 6 2012

The Dollar stayed higher longer than TLT but now the two have reversed with the Dollar leading the way down. Let's take a look.

In the top panel TLT rallied back to the expected 126-128 area and is fighting to hold its 50 day MA. In the main panel the Dollar experienced a fairly large trading range yesterday but closed under the 125 day MA. The significance is that The Dollar is a mere .6 points above its 200 day MA. Recall that most quantitative trading programs use the  200 day MA as a trading signal to go long or short. 

To really appreciate what is going on, let's look at the group on the other end of the tug of war financial rope so to speak. As TLT struggles to hold its 50 day MA, Crude Oil backs and fills in an assault to valut its MAs. 

Note that TLT peaked in late July as Crude Oil moved up. The 50 day MA has turned up nicely for crude oil and Crude has successively bounced at its 125 day MA just as the Dollar in the previous graph is failing at its 125 day MA. Interestingly Crude is also about .6 below its 200 day MA making this a mirror image comparison between Crude and the Dollar.

This will soon be resolved in what the media will no doubt dub a 'surprise' collapse in the Dollar as the Euro gains strength amid the gloomy unemployement reports for Spain and Greece. 

Patience, gold stocks and crude are up this morning. 

Breaking News TLT is down 1.37 on the open to  125.24........

Comments

[StuartD]

I noted that you use 87, 162 & 167 ma's on some of the current page charts in addition to the 'normal' ones. Could you please explain the rationale? I might guess that you are tuning some ma values to price action, perhaps.

On another note- I have been absent from this site whilst doing some intensive signal analysis work (the result of which 'happened' to get me into this latest break-out up!) and I have to say that the quality here has only improved especially in the area of socionomic analysis. Great job!

[StuartD]

In the past I have posted comments regarding Google\trends on search items: 'stock market top', 'economic downturn'. The latest result for the last 12 months is in a very definite channel that is trending down and currently both items are below 1.0 on the scale. Perhaps reflecting increasing complacency in the general population?

Also searches on 'Robert Prechter' (who has been presenting a negative market message since 2009) are miniscule apart from an appearance on Fox news in early Spring perhaps also supporting the idea that this message is not relevant in the eyes of the public.