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VIDEOFinancials, Oil, and Gold on the Move
Patterns and trends that could provide some opportunity in the coming days or weeks.
Also, the biggest and best moves come from failed patterns. So is the big head-and-shoulders pattern on the S&P 500, which everyone is yelling about, really going to happen? Or is this the big fake out? Only time will tell, but no matter which way it goes I'll be sure to catch some of it.
Below area a few charts pointing out patterns and trends that could provide some opportunity in the coming days or weeks.
Financial Sector ETF (XLF)
Financials play a large role in moving the major indexes, so if this reverse head-and-shoulders pattern breaks out to the upside then the indexes should rally and the XLF ETF could reach its measured move of $16.50.
Crude Oil Fund (USO)
Crude oil almost looked like it was going to break out and mover higher this week but sellers jumped in, sending it lower once again. The daily chart shows a large bearish pennant, which is known as a continuation pattern. So it looks as though we should see lower prices for oil.
Gold Bullion ETF (GLD)
Gold has been sliding lower for several weeks now and it looks to be showing selling exhaustion. The fifth wave down with the volume spike indicates panic selling as investors can't hold onto those positions any longer and exit. This is a bullish sign for gold. We're also seeing gold fall deep into a support level along with the 200-day moving average.
Mid-Week Financials, Oil, and Gold Trading Conclusion:
In short, the equities market is in limbo until a clear trend is established. If the financial sector breaks out to the upside then we should see a sizable rally. As for oil, it looks to be trading near the middle of its range but is still in a downtrend overall. Gold is almost looking ready for a bounce but I'm waiting for more confirmation before jumping on the wagon.
Chris Vermeulen offers more content at his site, TheGoldAndOilGuy.com.
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