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70-Second Market Outlook: Metals, Dollar, Bonds, Stocks, Energy

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Dollar and bonds are likely to correct while natural gas continues to do the opposite of the broad market.

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Over the past year we have had some really interesting things unfold in the market. Investing or even swing trading has been much more difficult because of all the wild economic data and daily headline news from all over the globe that's caused strong surges or sell-offs almost every week.

For a while there you could not hold a position for more than a week without some type of news event moving the market enough to either push you deep in the money or make you get stopped out for a loss. This has unfortunately caused a lot of individuals to give up on trading, which is not a good sign for the financial market as a whole.

The key to navigating stocks -- which everyone thinks are overbought -- is to trade small position sizes and focus on the shorter time frames such as the 4-hour charts. This chart is my secret weapon; it gives you both large price swings (which daily chart traders focus on) while also showing clear intraday patterns to spot reversals or continuation patterns with precise entry/exit points.

While I could ramble on about why the stock market is primed for major long term growth from this point forward, I will keep things short and simple with some 4-hour and daily charts so that you can see what I see and what I believe should unfold as we move forward.

Keep in mind, the most accurate trading opportunities that happen week after week are the quick shifts in sentiment which only last two to five days at most and which is what most of my charts below are focusing on.

Dollar Index – 4-Hour Chart

This chart shows a mini Head & Shoulders reversal pattern and likely target over the next five sessions. The dollar index has been driving the market for the past couple years so a lower dollar means higher stock and commodity prices.



Bond Futures – 4-Hour Chart

Money has been flowing into bonds for the past couple weeks with most traders and investors expecting a strong correction in stocks. As you can see the price of bonds hit resistance this week, and as of Thursday has now started selling off. Money flowing out of this "risk off" asset means money will move to the "risk on" investments like stocks and commodities.


No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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