Sugar Break Out

Brent WTI spreads

The Brent WTI spreads which widened to the historic highs of $ 26 per barrel seems to making way back. For past one month its making a higher low pattern which suggests that the short term bottom has been made and its on its recovery path. the triangle pattern which is being formed can lead to a break out on one side, the probability is more on the higher side for this spread.so in next few months we can see considerable upside in this spread

Correction in Gold

Finally gold showed some sign of correction to its long rally.On charts it has made short term high for sure. the double top formation has actually been formed and the actual price target on the lower side could be around 1500. but i believe it will take a some time to reach those levels and there is short term bounce back that might happen. gold has reached to its Fib levels, that is 61.8 % correction levels of its last move.Moreover 100 dma at 1630 levels would also provide considerable support. if that breaches the next support would be 1575 and then 1500.

Dollar Breakout

DOllar has moved passed its resistant and broken out of it range. there are a previous breakout also last time in july but it tuned out ot be a fake one and market went back into its previous range. Dollar hold key to most of the markets right now. Since most of the markets are clueless and stuck in a range, a break out in dollar would be important for the direction of the market

Correction in Gold

FInally we saw some correction in Gold, but is it the reversal we were waiting for. i dont think so. Gold is in bull phase and to play a bull market is to buy the dips. i think 1725 to 1700 will give a very good entry.

Oil remains bearish

Crude seems to be a in bearish set up, as both fundamental and technical reason point southward direction.With Libyan issue closing for a conclusion and techincially the much dreaded death cross formation on the chart. the upside tends to be limited. i still dont see Oil prices tumbling down and i have a strong view that oil will make a range and will trade a big range.

Silver

A pennant or a triangular formulation may drive silver prices to lower levels. conisdering gorwth concerns and cooling Chinese economy, silver has more reason to test lower prices

Equity markets looming over bear phase

SnP 500 is on the thin red line of 200dma. Technically a close below 200 DMA will ensure prolonged correction and a bear market in near future. So next few days or weeks will determine where are we headed for the future. last few of my post suggest that there may be deep correction in the offing.now the question is what will trigger that, will it be greece or euro default or insane commodity prices, or maybe anemic growth.

Gold Rally

With problems in Euorpe refusing to subside and dollar continuing to weaken, Gold rally doeasnt look ending anytime soon. technically its following a trend line and has nor closed below that trend line in last 3 months. ideally it should test the highs 1580 and then decide the big move on either side.A close below the trnd line might ensue a sell off but 1470 and 1450 levels would be crucial.

Double Dip , Another recession ?

Morgan Stanley's Cyclical index predicts another downturn is on the cards. the intensity of downturn may be difficult to fathom, but the indicator has been prophetic in suggesting business cycles. As the indicator (The blue line oscillator) already pointing southward, Not so encouraging news from europe and japan, emerging markets fighting the inflation monster, the next couple of months will be crucial to define the long term story.

US Dollar - Will the trend sustain

Dollar bounced back from its low and was trading around its 50 DMA. A close above 50 DMA will be a very bullish setup for US dollar. With QE 2 in its last leg and no QE 3 in offing, US dollar might bounce back harder then expected souring the commodity rally. All commodities are below their 50 dma which is quiet bearish for commoditites

Crude Oil overbought

it seems revolution has a cost and this time its $ 120 / barrel. But will we sustain this massive rally in oil prices. technically, if WTI remains above $ 93 , the rally is here to stay but we r still not sure of when and how much. Another view is from Bespoke investment who comes comes out with a very interesting piece of data which suggests that oil seems overbought and it might spike further right now.

"the price of oil closed more than three standard deviations above its 50-day moving average on Wednesday. This is a feat that hasn't been accomplished in more than ten years, and going back to 1983, it has only occurred in eight other periods. In the table below, we highlight the first day in each period where this occurred as well as the commodity's performance over the next week and month. In more than half of the prior periods, crude continued to rise, averaging gains of 1.07% over the next week and 4.03% over the next month"

Source - BespokeInvestement

Commodity Cycles at a crucial Level

trend reversal in Dollar

Though i m not a great elliot wave fan. But charts suggests that dollar fall might come to a halt and find some support to rally again.

SnP reversal

Candle stick patterns shows a shooting star and a hammer.. seems not all is well with equity markets

Equity markets due for a leg down

Text book pattern for a leg down in equity markets. 50 Dma crossing over 200 Dma. check what happened when the Moving averages crossed over.