Dollar At Bullish Price Objective

I am happy to report that ole’ bucky has finally done it – we are now officially at our bullish P&F price objective. If you wonder why I am so elated – well as you probably know I get paid in Dollars, but I also live in Spain and a weak EUR puts some extra purchasing power in my pocket. And in general I have a hard time accepting an ever degrading reserve currency. We’ve had plenty of that in the past few years. Not that any of the ‘competing’ currencies, except maybe the CHF has been exhibiting much strength either. Rather what we are seeing is a race to the bottom and the only remaining measuring stick worth anything are precious metals.

Well, here’s the P&F I was talking about – my subs know it well. As I am typing this we are near 82.5 – two dimes short of the PO but good enough for government work as they say. Once again our P&F price objective resolves successfully – which is why we keep using them.

Here’s the time based chart – we are far far outside the 100-day BB and I fear at some point we’ll see a snapback. Look, I would actually be happier if we would have stopped near 81.5 and put in a bit of a correction. The current move helps stretch those Bollingers but we may also see a more violent long squeeze in the near future.

Two pieces of information on the long term panel. The weekly shows us the remaining upside potential should we push higher. Don’t think that scenario is impossible – currency short squeezes can overshoot any reasonable technical target. Let me direct your attention to the monthly chart and you may get an idea of what I’m talking about when I worry about seeing a snapback. They tend to happen after very long monthly candles, so let’s keep that in mind starting June.

Believe it or not I was actually able to scrape together a very nice shopping cart of setups for you guys – what a difference one day can make. So please step into my summer lair and let’s get to work:

Crude has continued its sell off far beyond anyone could have expected. We got a nice ID setup several weeks ago and banked some mighty coin near 95. But this is sell off is a lot more than anyone probably bargained for. Hunting for a bottom here is foolish, however…

Well, you may have guessed it – we got ANOTHER inside day – after seeing two just in the past six sessions. And being the mindless robots that we are we’ll have to take it. IF you are already short (due to the previous ID setup) then you can use a breach of today’s high as a stop and a breach of today’s low as a signal to maybe pyramid up a little. If you are not positioned then just have at it.

Also as a sidenote – if we breach the 100-hour SMA (pointed out in the previous chart) then use it as upside confirmation. No guarantees in trading but this is how I approach some of my setups – a simple accumulation of decision/inflection points.

Cotton is sitting in a similar boat – almost the same setup.

There are the price triggers for tomorrow. Again, use the 100-hour SMA for upside confirmation.

Inside day on copper – you know what to do.

Inside day also on natgas. You may be interested in know that 2.537 is the 25-week SMA, so we have something to hang our hat on.

Sugar – also not looking that sweet these days. Another inside day setup but I am merely interested in a long setup here. Trend traders may disagree but that’s how I roll after a 2-month sell off.

30-year treasuries – another inside day! The range is a bit wide though, not my favorite setup today.

Currencies – AUD/JPY – looking a bit like sugar, isn’t it?

Here are the ID setup triggers – have at it.

CAD/JPY – someone must be getting nervous in Tokyo – I’m surprised the BOJ hasn’t stomped all over this already. Anyway, that’s what I’m talking about! We had a very juicy and a very disappointing ID setup in the past two weeks. Let’s hope this one will show us some love again. BTW, I would take both sides here – plenty of room to run on the up and down side.

Cheers,