Can Crude Move Higher, Post Correction ??

Brent  Crude started correcting as it ran into resistance at $ 51.80, monthly 20 EMA and has also developed a negative divergence on the weekly charts, presently  trading below $ 49.45, the 5 week EMA.

The price has not closed below its 5 week EMA  for two consecutive weeks  during 2016 up move, but things look different  this time.  A deeper  correction looks likely as the trigger (yellow dotted) line threatens to cross below zero, indicating a  negative momentum in place for the short term.  This may drive down the price  and  crude may correct to  $ 43-44, where it could find support at the conjunction of 20 & 50 weekly EMA.

Brent Weekly

The intermediate trend remains bullish  with positive divergence on the monthly chart.  Further the  weekly trend oscillator  is gaining momentum to cross over zero, which implies  further upside for crude. It would be interesting to see if the resumption of uptrend after the present  correction could propel Brent to $65 levels.

Brent Monthly

Crude is unlikely to revisit $ 30 in the near future, with the crossing of weekly trend oscillator above the monthly trend oscillator, indicating a bottom is in place.

To sum up,  we may be looking at higher levels in Brent, once the short term correction is over.

See also :  Brent Heading to $65 ?

Nifty Bull Run to Continue !!

 Nifty seems to be taking a breather with the Grexit, Rajan exit and Fed rates worrying the markets. The Indian monsoon is a crucial event eagerly awaited by the market. Markets do what they have to technically and events don't drive the market.  Nifty has  performed well  against the odds so far and is well placed technically to move higher.

The indices has been making higher highs and the corrections have been shallow indicating that bull market is in place. With all three short, inter and long trend oscillators on daily TTO charts firmly placed above zero, Nifty seems to be consolidating as the minor trend corrects from the overbought position. This represents a time correction in a bull market. With the Synchronized Bullish  Alignment (SBA) pattern on the TTO, another sharp up move is likely in the next few days, taking out the resistance at 8300-35 levels.

Nifty Daily with SBA

On the weekly TTO charts, the  short and intermediate trend oscillators are set to cross the long trend oscillator in the next few weeks. The crossover will result in a blowout rally, something witnessed during 2014 which could result in Nifty taking out the previous high and reach higher targets.

Nifty Weekly

Visible Signs of Underlying Bullishness in Nifty

 POST UPDATE  : May 27, 2016
Within a week of our  following post, Nifty has exploded into bullish territory with tremendous momentum rising from 7889 to 8120 as seen in the chart below and in the process crossed 7995 which was a major resistance. Nifty is now all set to target 8335 in the immediate short term.

Nifty Weekly

ORIGINAL POST :
Nifty seems to be struggling to cross 8000 levels indicating weakness and  a range bound market between 7800-7900 since the last couple of weeks. This gives an impression that a larger correction is round the corner with lack of any immediate triggers.

However, a closer look at the weekly chart tells another story. Having risen close to 1200 points within the last two months from 6850 to 7991, the indices seems to be consolidating  within a 250-300 point range. The bullishness in Nifty can be attributed to the following :

1. The loss of momentum  as indicated on TTO (Nifty weekly charts below) has not resulted in any serious correction, but a sideways market, indicating a bullish bias on Nifty. Once the momentum turn positive ( trigger line crossing above zero), it will be accompanied by a breakout on Nifty with upward targets.

2. Nifty seems to be making an inverse H&S formation (weekly charts below) with nearing completion of the right shoulder, with a neckline placed at 8000. Any breakout above 8000 gives a target of 9000-9100 within a time frame of  2016.

3. On the Nifty monthly charts below, the trigger line has crossed over above zero indicating positive momentum, after a long corrective phase of  almost 14 months. This indicates that all corrections would be an opportunity to buy into and bearish bets should be avoided.

Nifty Weekly

Nifty Monthly

Nifty Breakout To 8600 ??

The Indian markets are  riding the wave of upswing in global market. Rising crude oil prices reaching a four month high , favorable Chinese data and Fed reluctance to increase the interest rates have helped the global markets in recovery.

Though IMF has cut the global growth forecast from to 3.5% for FY17, it has retained the growth forecast for India to 7.5%, making it the fastest growing large economy in the world. This may help a larger chunk of foreign investment being redirected to India.

After correcting and being in a downtrend for almost 13 months, Nifty seems to have found strength to break out of the falling channel. A spate of favorable news on normal monsoon, lower inflation and hopes of economic recovery  has contributed to improvement in the market sentiments.

The Triple Trend Oscillator has given a buy signal indicating a long term change of trend. The trigger line on the monthly Nifty charts has crossed over zero indicating resumption of uptrend after almost a year. The trigger line crossover has in the past reliably indicated a major trend change. This is coupled by  a channel breakout by Nifty which revises the upward target to  8600.

On the daily charts Nifty has formed a bullish inverse H&S formation with neckline at 7800, which again provides an upside target of 8600 on Nifty.

Nifty may, however face some resistance at 7975 and 8330 levels on the way to 8600.

  See also : http://eqtrend.blogspot.com/2016/03/nifty-probable-elliott-structure.html

 

Gold Heading to $1400 ??

Gold had been trending in a downward sloping channel since 2013 and has now broken out of it, presently trading at $1242.

With the sluggish USD, gold seems to be gaining strength in the short to medium term and may head higher to $ 1400 to test the long term falling trend line.

The rise in gold could be in sync with rising crude oil prices which are likely to hit $65 in the medium term.
See post http://eqtrend.blogspot.in/2016/04/brent-heading-to-65.html

Gold Weekly

Update July,1 2016 :

Jim Roger's endorsement of Gold touching US$ 1400.

Brent Heading to $65 ??

After touching the lows of  $28 Brent moved to $38- $38 levels as indicated in our post  : Has Brent Found Short Term Bottom  .

Facing resistance from the falling trend line,  Brent seems to have over come the resistance,  now trading  at  $41.85  and ready to move higher. With the long term divergence on the monthly charts, brent may be targeting $65-$67 (which is the highest point in the developing divergence) levels in the medium term (end 2016-early 2017).
 

BrentMonthly

The bounce in crude prices, however, may be a retracement in the larger down trend as can be seen from the following  chart, with all the TOs, still trending below zero.
 

Brent Quarterly

Rupee Strength May Surprise in the Long Run !!

INR reached a low of 68.85  against the USD and has reversed as predicted, in the process making a multi year double top formation.

With the trigger line crossing below zero and INR falling below 67 mark (5 month EMA) the reversal may have been confirmed with the next target of 64 and further lower at 58.

USDINR Monthly

 A look at the yearly chart of USDINR indicate multi year divergence between price and momentum. The  TOs reversing indicate rising strength of INR in the coming years.  With the INR reversing from the upper Bollinger Band, it may gain further strength to seek lower targets to test 49 (yearly 20EMA) in the next few years.

USDINR Yearly

Earlier post on USDINR :
http://eqtrend.blogspot.in/2016/01/usdinr-topping-out.html