Commodities Countdown

Is This A New Commodities Comeback?

Commodity related stocks are rallying this week after a significant blood letting for all those who hold long positions in the area. After crude oil broke its 1-year trendline, and Natural Gas tested the bottom of the range, all of the ratios have significantly improved this week. Using some of the same charts I used on Monday's get ready article, we can see a significant improvement already.

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Gold Drizzles, NatGas Pauses, Oil Surges

For Gold traders, GLD is back where it was 10 days ago after shooting higher on Friday morning, then reversing. This frustrating trading action has made it difficult for any trend followers to profit in here. The SCTR continues to show GLD as one of the weakest ETF's out there. The purple Relative Strength compared to the $SPX shows a flat, inline performance. A breakout from this 4 month base would probably attract  lot of buyers, but until they show up for work to push this higher, we seem content to trade just under the long term average. In the zoombox on the right, we can see the price action briefly pushed up on Friday only to close back in the middle of the range. Now it looks like the MACD wants to roll over with lower momentum.

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